Society in decay

Shocking crimes may have economic explanation

By Lee Hyo-sik

Many households here have seen their finances deteriorate since the global financial crisis in late 2008, weighed down by shrinking incomes, rising debt and the surging costs of daily necessities.

More people borrow money from banks and other financial service firms to pay for growing living expenses. But many default on debt payments due to tight job market conditions and falling real estate prices. Yet, they continue to borrow more to make a living, falling into a vicious debt trap.

With no way out, some have resorted to violent acts against others to vent their anger accumulated during daily life, highlighted by a series of sudden, seemingly mindless violent crimes committed by individuals in dire financial situations.

With Asia’s fourth largest economy showing no sign of a recovery amid the global economic slump, such ``rage crimes’’ will likely increase in the coming days, making Korea no longer one of the safest countries in the world.

According to local credit ratings agency Nice Investors Service, Sunday, its credit default occurrence index rose to 20.8 in March, up from 16.83 in April last year, indicating 23.6 percent more individuals failed to meet their debt payments.

The larger the index becomes, the more people become financially distressed. It has been on an upward trend since the latter half of 2011.

The number of people belonging to the bottom 10-percent in credit rating, mostly credit defaulters who cannot carry out normal financial activities, has surged to the highest level since the collapse of Lehman Brothers in late 2008.

According to the Korea Credit Bureau, the figure rose to 405,000 in May, up from 333,000 in December 2010. The bottom 10-percent accounted for 1 percent of the economically-active population, up from 0.84 percent over the same period.

The number reached the largest at 458,000 in December 2009, accounting for 1.21 percent.

``The rise in the number of credit delinquents is largely attributed to surging household debt, the sluggish real estate market and worsening job market conditions.

The problem is that household finances will likely continue to deteriorate down the road with no sign of an economic pick up,’’ said an analyst at Nice Investor Service.

According to the Bank of Korea, the nation’s household debt totaled 922 trillion won in June, up 10.85 trillion won from three months earlier.

The number of unemployed in their 20s and 30s has been rising over the years as companies have become reluctant to hire workers due to plunging sales at home and abroad.

But those in their 50s and 60s have increasingly taken part in economic activities as more senior citizens take low paying and manual jobs in the services sector.

With a rise in the number of young jobless grappling with surging debt and other economic difficulties, they became more willing to take extreme measures against others to express grudges against society.

For instance, a 30-year-old man surnamed Kim stabbed two former colleagues and two bystanders in Yeouido, last Wednesday.

He told police that he committed the crime because of a grudge he held against his former colleagues. Since he lost his job in 2010, he has been living in shoddy accommodation and has financial difficulties including a 40 million won debt.

Kim blamed his misfortune on former colleagues who he said slandered and bullied him.

According to the National Police Agency, the number of rage crimes reached 389,195 in 2001, up from 299,543 in 1998 when Korea was hit hard by the Asian currency crisis. In 2009 when Korea struggled to deal with the fallout of the global financial market meltdown, the figure jumped to 448,420.