Lee’s Governing Philosophy Should Be Based on Free Market Economy

By Lee Jae-Kyo

Professor of Law at Inha University

The debates over ideology may no longer be necessary but the ideology itself is needed. Denying ideology and stressing only pragmatism is a reckless move since it may return our society to an anti-capitalist system. To reinforce and develop, our system requires strong confidence in the free market economy. The key word for the government of President Lee Myung-bak is pragmatism. In his first press conference after the election, Lee declared, ``The People voted for pragmatism, not ideology.'' Afterwards, pragmatism surfaced everywhere.

In his inauguration speech on Feb. 25, Lee said, ``We must move from the age of ideology into the age of pragmatism. Pragmatism is a rational principle prevalent in the histories across the globe, and practical wisdom useful in charting our course through the tides of globalization.'' With pragmatism, he proposed to ``reduce the social strife and stop violent labor strikes.'' He made it sure that his government will approach inter-Korean relations ``in a pragmatic manner, not ideologically.'' He declared ``the era of ideology is over and it's now the era of pragmatism.''

He is right. Ideological debates have no meaning any more. The history of the 20th century has proved socialism is an inhumane system that contributes little to mankind's happiness. There is no form of socialism left on earth. Everybody now knows that the free market economy is the sole system that can ensure prosperity and a better life. All this negates the need of ideological debates.

Does this mean that we don't need ideology, either? Can pragmatism be a remedy for every ill? I wonder how pragmatism can be the zeitgeist chosen by the people, the wisdom useful in making our ways through the tides of globalization and a resort to reduce the social strife and resolve inter-Korean relations. A thought comes to my mind that his ``un-political'' attitudes toward the wealth accumulation by his Cabinet members may derive from the abuses of pragmatism. Isn't it that he has neglected a rigorous verification process to pick his aides by resorting too much to pragmatism in the belief that it won't be a big problem for a Cabinet member to have achieved his wealth through speculative investment in real estate as long as he is competent? It is proper to prioritize pragmatism but I can't help but say that something is missing. What's wanted is a strong faith in a system or ideology.

It seems President Lee has an aversion to the word ideology itself. This may be a reaction to his judgment that the previous governments have led the nation in the wrong direction by indulging in ideology too much. He assumes that the direct experience achieved from actual business management is the only reliable guidance while an ideology smacking of deskwork is useful only for the sake of debate. If members of a society think that ``capitalism is efficient but inhumane while socialism is more humane but hard to realize due to the people's selfishness,'' can this society be sound and strong?

Insisting on Pragmatism Only Is Reckless

It will be highly reckless if President Lee rules out ideology and insists only on pragmatism or efficiency. When the government fails to live up to the people's expectations while stressing pragmatism ― this is likely due to the external surroundings even if Lee's government is doing the best, and anti-capitalists can overtake it at any time. We have already gone through ``the lost decade.'' We cannot afford giving political power to the anti-capitalist camp any more. If we do, Korea will not be able to become an advanced nation but will stay as a second-team player permanently. It will be a catastrophe for the nation and the people. To avert the tragedy, the government should persuade its citizens that the free market economy system is not only efficient but also ethical. With such a faith deeply rooted, then the people will give a second chance to the liberal government even if the first attempt comes as a failure. There won't be a catastrophe with anti-capitalists taking over the power.

Second, it is hard to win over hard-liners in a labor union without firm conviction in the free market economy system. When the general elections are over in April and Lee's government settles down, then the anti-capitalist camp will launch their assault on the system. The opponents, in particular, the Korean Confederation of Trade Unions (KCTU), will likely rush to deliver an all-out attack from the humiliation of suffering a huge defeat in the latest presidential election.

The KCTU has already threatened to take hostile countermeasures against all the actions by the Lee government. We should be reminded that it was her iron-fisted will and the people's full support that enabled former British Prime Minister Margaret Thatcher to prevail in the 363-day stand-off against labor unions that could have easily overthrown a cabinet at their disposal. The victory of Thatcherism would not have been possible unless the people supported it. The new government of Korea needs a similar conviction and public support in its efforts to fend off one of the world's most militant labor hardliners. The unionists will mount pressures on the government by stopping airlines and trains and halting the car assembly lines to hurt exports so that it can obtain as many concessions from the government as possible. According to the doctrines of pragmatism, conciliation can be the best available solution.

However, yielding to the arrogance of labor unions in a free market economy is nothing more than a breach of the basic principles and a defeat. Therefore, pragmatism alone is insufficient. The government can crush anti-capitalists only when policymakers and the people uphold the conviction that capitalism is rightful and the market is the most fair.

In this context, it is reckless for the Lee government to refute ideology and instead rely only on pragmatism or efficiency as this could send our society back to the old days of anti-capitalism.

Third, the concerns are high that our society may return to anti-capitalism. When former President Roh Moo-hyun took office five years ago, many advocates of the market economy voiced worries that the anti-capitalist regime may last for as long as 20 years. The prediction was based on the strong detestation of capitalism shown by the Roh government and the Koreans' disposition that they would rather tolerate poverty than see the others obtaining disproportionate wealth.

Furthermore, there are some people who believe that capitalism or liberalism is the source of all social evil. Acknowledging socialism is unrealistic, they tend to believe that capitalism is a system where the law of the jungle prevails and exacerbates the unfair distribution of wealth by serving only the few ``haves.'' The animosity is rather a reaction to the decades-long practices of anti-communism education before the anti-capitalist regime took power in the late 1990s. Many young people quickly inclined toward socialism upon realization that what they learned from school ― a communist looks like a monster with horns ― was totally untrue.

The result was no surprise given that there had been no efforts to provide the people with a strong confidence in the supremacy of capitalism and free market economy. Against this backdrop, the people's choice of Lee Myung-bak can be interpreted as a major disappointment at the incompetence of the past anti-capitalist regimes and the rising hopes for capitalists, rather than a reflection of an adamant belief in the ideology of capitalism. That's why it's still a peril to ignore ideology.

Strong Faith in Free Market Economy

In order to strengthen and develop our system, the President and government officials need to develop a strong faith in the free market economy. Former U.S. President Ronald Reagan is a famous champion of the free market economy, dismissing communism as a crime, not something possible for coexistence. Therefore, he dropped the then-popular policy of detente and adopted a hawkish stance to invite the Soviet empire into an arms race and eventually led the ``Evil Empire'' to collapse. The success earned him a credit as the great president who ended the Cold War.

``General Secretary Gorbachev, if you seek peace, if you seek prosperity for the Soviet Union and Eastern Europe, if you seek liberalization: Come here to this gate! Mr. Gorbachev, open this gate! Mr. Gorbachev, tear down this wall!'' (cited from a speech by the former U.S. President Reagan in front of the Berlin Wall, Germany, on June 12, 1987)

Thatcher adhered to Milton Freidman's idea of liberalism that a society which pursues equality loses both equality and liberty while a society which pursues liberty can achieve a higher level of liberty and equality. She held a strong conviction that liberalism is more efficient and moral.

With a strong will, Thatcher cured the so-called British disease featuring an economic slump and frequent labor strikes, and changed the paradigm of a welfare state to a free market economy. The people paid their respect to her ideas and policies, summed up as ``Thatcherism.'' Thatcher is the only one who has her name added with ``-ism'' among 55 prime ministers in the history of Great Britain, a nation home to parliamentary democracy and the Industrial Revolution, and the empire on which the sun never set.

The Lee government needs to realize that ``capitalism is a system of justice'' and preach this perception to the general public. They have to persuade people that capitalism is not only efficient but also morally just. They must help citizens prepare for a fight against an anti-capitalist force by equipping them with strong confidence about the supremacy of capitalism and the free market economy. In this sense, the era of ideological debates has ended but the ideology itself is not gone forever. Pragmatism alone is not sufficient.

In her visit to Korea in 1992, Thatcher told Koreans, ``When we believe in our opinion and infuse it to other people and defend it from a challenge, we would live in peace and freedom. Ideological war must be waged every day. The people in Korea will know about it very well.'' Her remarks are still useful even after 16 years. Maybe, that is the best advice for us now.

Like Thatcher, Lee Myung-bak would be able to get a credit with his name attached by an ``-ism'' if he changes the paradigm of ideology with the firm belief in the legitimacy of capitalism. However, what he has done so far after being sworn in as president undermines such hopes. Three candidates for cabinet were thrown out even before being appointed by the President due to strong public criticism about their past wrongdoings. With the world fast changing in the age of information, he committed himself to a lifestyle of the old development-driven days by working hard with only four hours of sleep. The selection process of lawmaker candidates for the April 9 general elections in the ruling Grand National Party (GNP) is also disappointing.

However, it's too early to abandon all hope. Fortunately, President Lee appears to be aware that pragmatism is merely a device of ideology. In a press meeting with local reporters and foreign correspondents on Jan. 17, Lee declared, ``Creative pragmatism will become the behavior norm for the next government.'' A behavior norm cannot be a philosophy of governing the state.

The key policymakers of the new government have proposed ``harmonious liberalism'' and ``creative pragmatism.'' According to GNP chief policymaker Lee Han-gu, ``harmonious liberalism is Lee's governing philosophy while creative pragmatism is the behavior norm.'' Whatever the descriptions they give, their intention is to achieve liberalism by way of pragmatism. Can we hope for the birth of Lee Myung-bakism with a great relief that the ``lost decade'' of the past regimes is simply ``a decade that we had to go through.''

This story appears on the Web site of the Center for Free Enterprise.