By Kim Yon-se
Staff Reporter

Korean voters picked Lee Myung-bak as the new President for his hot passion to revive the Korean economy. Many believed that the former Seoul mayor would realize the ``Second Version of the 1960s Economic Miracle on the Han River.'' He won the presidency by a margin of over 5 million votes. This is unprecedented in the decades of the nation's presidential races.

The self-declared pragmatist's euphoria over the victory may be short-lived. He must face cold realities, both controllable and uncontrollable variables.

His first job would be the ``expectation management'' as people have high expectations on the creation of more jobs. Even allies have high expectations for Lee.

In diplomacy, he stressed a strong alliance with the United States. It means Washington has the high expectation that every bilateral pending issue will be settled amicably.

Despite his rhetoric, he has yet to set out a vision to consolidate the alliance, as well as relations with the other powers surrounding the Korean Peninsula, including China, Japan and Russia.

Lee emphasized that the strong Korea-U.S. alliance takes precedence over inter-Korean reconciliation, the reverse policy of his predecessor. He nominated a hawkish professor Nam Joo-hong as the unification minister, who is widely perceived to be Korean neocon that could outshine former U.S. envoy to the UN John Bolton in Cold War ideology. The Cold War warrior may help Lee's conservatives rally for the April general elections but inter-Korean relations and the denuclearization talks are unlikely to make progress.

It is unclear whether he can be successful in persuading North Korea to dismantle nuclear programs completely if he shows sign of hawkish attitude.

As a successful CEO, Lee also emphasized results rather than processes. Thus he may encounter many unexpected troubles in his result-oriented policies.

He emphasized the importance of English education with an ultimate goal of enabling even high school graduates to communicate in English in their daily lives and eliminating the ``goose daddies'' who are left alone in Korea to finance the education and life of their children and wives.

His ambitious 747 Project (7 percent growth, $40,000 per capita income and the seventh largest economy) has already been put to the test. Although it was a campaign pledge, it raised the expectations of the people.

But he confided that 7 percent growth is not an immediate goal. Adding problems for him is the troubled U.S. economy due to subprime mortgage woes.

External factors surrounding the Korean economy are not so favorable. In particular, skyrocketing oil prices, the U.S. subprime loan turmoil and the delay of the Korea-US FTA ratification will erode growth potential.

Negative indices overseas, such as high raw materials prices and the international financial market crunch, are posing obstacles to the economy.

Accordingly, the more urgent issue for the Lee administration will likely be minimizing the side-effects of the subprime fallout on the Korean economy, rather than pushing for more growth.

``Our economy is easily susceptible to external factors. The idea that a chief policymaker can vitalize the economy might be pie in the sky,'' an economist at a Seoul bank said on condition of anonymity.

He also faces the ``parallel agenda'' of maximizing growth and narrowing the widening income gap. He believes economic growth will solve the income disparity. According to a BBC survey, Koreans rank first worldwide in their complaints over the widening income gap.

Many economists also say that economic growth is not a cure-all for poverty and narrowing the income gap.

``History shows that economic growth is a necessity to solve poverty, not a sufficiency,'' said Choi Kyung-soo, a senior research fellow at the state-funded Korea Development Institute (KDI).

He said that economic growth should either have a strong engine or be labor-intensive to solve poverty.

Korea has seen the poverty rate grow since the mid-1990s, mainly due to the decrease of jobs in the manufacturing sector, according to the economist.

The analysis showed the average real wage of the bottom 20 percent recorded 1.2 million won in 2005, only 1,000 won more than a decade ago. The real wage of the middle class, meanwhile, stood at 2.47 million won, recording an annual 1.6 percent growth on average, indicating the poorest households have not recovered since the 1997 Asian financial crisis.

Choi also said low-income households, who lost jobs in the manufacturing sector due to the international division of labor, are not successfully switching to other sectors.

Some say President Lee will be watching for a scenario in which he adheres to only to higher economic growth rate and fails to retain ``stable'' macro-economic strategies.

Policy Consistency

A certain portion of voters who supported liberal presidential candidate Roh Moo-hyun in 2002 is believed to have voted for Lee from a conservative party in last December's election.

This represents an apparent comparison with the case in which many of the supporters of liberal Kim Dae-jung (who served as president between 1998 and 2003) voted for Roh who more or less succeeded to the political philosophy of Kim.

Many netizens and experts say that more and more Koreans have been fed up with Roh's self-righteousness, and policies inconsistent with his former pledges to the middle- and low-income brackets.

They point out that President Roh implemented what he wanted, not what the people wanted.

The incoming President is tasked to solve the bad legacies his predecessor left behind ― widened income gap, high real estate prices, frequent disputes with the media, and his excuses for policy failures.

On the surface, Seoul and Washington appear to be in strong alliance. But the incoming President and his party said fences must be mended in the bilateral ties.

Whereas Roh indirectly described himself as an anti-U.S. policymaker during the initial part of his tenure, he gradually changed his policy direction toward pro-America by driving out aides who issued problems of the overseas troop deployment and the FTA talks with the U.S.

He eventually lost all as he tried to gain support from liberals and conservatives.

It seems that liberal Koreans who changed their support from Roh to Lee hope for better living conditions even though they know the new President's policies toward the U.S. and North Korea will not be coincide with their views.

Now the issue is whether Lee will offset possible criticism on expected pro-Americanism and tight inter-Korean relations from liberals by fulfilling his main campaign pledge ― reviving the economy and creating jobs as many as possible.

Predictable Policies & Generosity

The majority of Koreans don't want a president who might lead the country into confusion with unpredictable policies, and who struggles to justify his misadministration.

Irrespective of political leaning ― left-wing or right-wing or neutral ― people hope that Lee will make steady efforts to keep his pledges by persuading opponents.

In addition, they wish the new President to be humble to generously accept criticism and unfavorable public opinion.

``Lee should not forget the reasons why nearly 50 percent of Koreans picked him,'' a university professor said, requesting not to be named. ``Koreans who do not voted for Lee will also support him if he shows truthfulness and consistency.''

The professor said he does not agree with such policies of Lee as the cross-country canal project and reinforcing English education in public schooling. But he said, ``I'm willing to support those if the Lee government polishes the policies via various public hearings to reconsider possible side-effects.''

Lee vowed to build a canal, which will cross the entire peninsula, making possible inland water transportation. While Lee estimated the cost of the project at $16 billion, critics say the figure would be closer to $50 billion.

Skeptics say the project requires a huge amount of money and it should not be carried out blindly. They are poised to invite more experts from every field to verify the problems of the project from diverse angles.

Lee's transition team also announced a series of measures designed to enhance English education. This is part of its effort to address what it calls the ``English divide,'' which stems from increasing social bipolarization.

The plan, however, has faced a severe backlash from experts and society in general.

Critics say they are concerned that Lee's plans include many unrealistic goals, are proceeding in a rough-and-ready manner and will need more measures to complement possible shortfalls.

Concerns are widening in education circles because the nation lacks teachers who can use conversational English fluently and many old English teachers can barely speak it.

kys@koreatimes.co.kr