Deregulatory frenzy in Koreah is as bad as, or worse than, too little

Posted : 2014-03-28 17:18

Updated : 2014-03-28 17:18

Deregulatory frenzy

Too much is as bad as, or worse than, too little
Barely a week after the seven-hour-long discussion at Cheong Wa Dae, the government has come up with follow-up deregulatory steps. “Strike while the iron is hot” seems to be the slogan of the Park Geun-hye administration in its war against bureaucratic red tape. 
President Park is not the first leader to tackle this chronic ailment that hampers economic activities and hinders creative initiatives, however. Most of her predecessors made similar attempts, especially in the early years of their tenure, but none succeeded because of inherent problems with their plans or bureaucrats’ resistance, or both.
Unfortunately, the nation’s first female president appears to have learned few lessons from the experiences of former leaders, and may follow in their footsteps.
Above all, the government is not distinguishing between good regulations and bad ones.
For instance, officials are right to remove the ban on food trucks doing business at amusement parks, or allow consumers, local or foreign, to buy goods through electronic commerce without having to install public certificate programs called the Active-X. Eliminating these regulations is not just good for small businesses and the self-employed, but necessary for the sake of consumer benefits.
We cannot say the same about their plans to permit telemedicine between doctors and patients, or allow large hospitals to run for-profit subsidiaries. For these moves will mainly benefit large businesses at the expense of patients and smaller hospitals, by limiting access to public health care services or increasing medical bills.
Even more glaring is the decision to allow a flag-carrier to build a seven-star hotel near three high schools and the nation’s largest royal palace. Officials say there would be little adverse effects on education as long as there are no “harmful shops” ― hostess bars and massage parlors ― within the area.
But the existence of a luxury hotel itself will “considerably disrupt” the educational environment, as a school principal says. Korea is no longer a monarchy, but spiritually it will similar to a towering hotel overlooking Korea’s Buckingham Palace. After all, Cheong Wa Dae sits side by side with Gyeongbok Palace.
No less serious than this “the-more-the-better” haphazardness is the “the-sooner-the-better” haste. New policies go with costs and benefits, and nowhere is that truer than in the area of deregulation, which is a social agreement of sorts. Yet we can see few signs the Park administration has conducted any cost-benefit analysis on the 41 regulations it plans to do away with by the end of this year. If it did, the outcome would be too lopsided, with businesses taking away most of the benefits and the costs being shouldered primarily by the rest of society.
A procedural legitimacy is crucial to prevent this social inequity, but the Park administration seems to be lacking any awareness of such a basic principle in structuring a democratic government.
President Park will have to deal with low-echelon bureaucrats to revise rules and regulations, and with opposition lawmakers to amend laws. It should be the process of painstaking motivation and persuasion, not one-sided push and drive, as Park is doing now.
A long, uphill battle is ahead for the chief executive.