By Yoon Ja-young
It is natural that the Moon Jae-in administration is reminiscent of the former Roh Moo-hyun administration in many ways, considering the President holds the philosophy of his long-time friend.
Economic policies are no exception. Behind this déjà vu is a most powerful man of the previous Roh administration, who is resurging after a decade’s hiatus.
The appointment of key economic policymakers by President Moon reminded market watchers of Byeon Yang-kyoon, who served as planning and budget minister and as presidential chief secretary for national policy during the Roh administration.
Born in Tongyeong, South Gyeongsang Province, he studied at a high school in Busan, the political background of the two presidents. After passing the government exam to become a ranking official, he built up career as an economic policymaker, working at key posts.
He was a heavyweight of the Roh administration’s economic team until he resigned in disgrace following a scandal involving art curator Shin Jeong-ah. He had been quiet during the past decade, except for a few books he published to defend economic policies of the Roh administration.
Many of the officials who are connected to Byeon, however, grabbed key posts in the Moon administration, raising speculation that Byeon is the man who has the controls behind the curtain.
Strategy and Finance Minister Kim Dong-yeon, for instance, won trust from Byeon while working under him. President Moon’s senior secretary for general affairs Lee Jeong-do served as Byeon’s secretary when the latter was a vice minister, continuing assisting him when he was promoted to minister.
When Byeon moved to Cheong Wa Dae, Lee also followed him. First Vice Finance Minister Ko Hyoung-kwon also served as Byeon’s secretary when he was a minister. Hong Nam-ki, who was appointed as head of the Office of Government Policy Coordination, is also known to have been recommended by Byeon. Hong assisted him while working in Cheong Wa Dae under the late former president.
The 68-year-old Byeon joined the policy advisory board for President Moon during the election campaign. Moon, who was presidential secretary and chief of staff during the Roh administration, is reputed to trust his former colleague.
It is thus no wonder that the two share the same economic philosophy. Byeon led the “Vision 2030” project during the former Roh administration, which presented a mid-to-long term strategy for the country’s economic development. The top economic policymakers of the current administration including the finance minister also participated in the project, leading the report to get the spotlight. Aiming at achieving both growth and welfare, the philosophy in the Vision 2030 resembles President Moon’s economic policy, which emphasizes income-led economic growth.
Byeon recently released a book, “Transition in Economic Philosophy,” where he advises that economic policymakers should adopt the philosophy of Joseph Schumpeter instead of John Maynard Keynes, the mainstream economic policy model to overcome recession.
Schumpeter focuses on the government’s role in setting up an ecosystem for innovative entrepreneurs, thereby leading to economic growth. Byeon says Keynesian short-term policies cannot solve Korea’s structural problems behind its low growth and falling growth potential.
In his book, he stresses enhancing the quality of life and maintaining a balance between equity and growth, which the Moon administration also strives for.
However, some of the solutions he suggests don’t seem to exactly fit President Moon’s pledges. For instance, Byeon supports easing restrictions in the metropolitan area and allowing businesses to use irregular workers to give them more flexibility, though he also stresses that the government should bolster the social safety net for workers.