Zero to superhero and anti-hero

This presentation lays out some broad trends in South Korea’s modern development: its “zero-to-hero” economic rise and its subsequent “hero-to-superhero” political and social development. It also looks at some of the negative collateral problems that this astonishing development spun off, problems which continue to trouble Korea to this day.

Andrew Salmon
Writer for CNN and The Times

By Andrew Salmon

Abstract:

This presentation lays out some broad trends in South Korea’s modern development: its “zero-to-hero” economic rise and its subsequent “hero-to-superhero” political and social development. It also looks at some of the negative collateral problems that this astonishing development spun off, problems which continue to trouble Korea to this day.

Prologue: The Korean War as basis for development

It is almost a cliché: South Korea rose from the ashes of war. Certainly, given the devastation and poverty of the war years, South Korea had only one possibly trajectory: Upward. However, that trajectory continued well beyond immediate post-war reconstruction and impressive economic growth continues today. But let me begin my looking at some war-related, and immediate post-war-related factors, in Korea’s development.

Leadership and authoritarianism

By dispensing with the messiness and inefficiencies of others forms of governance ― such as democracy ― a dictator does not have to worry about political opposition, human rights, environmental standards, legalities, regulations and similar such constraints can. With this advantage, a dictator can ― over the short term, at least ― raise productivity and efficiency. Both Hitler and Mussolini accomplished this. Park and Chun would manage the same: Park, in particular, had operated in Manchuria with the Imperial Japanese Army and had seen, at first hand, the military-industrial nexus.

Yet Japanese militarism was not his only lesson in authoritarianism: Park flirted with communism prior to the Korean War. It is an irony that while Park adopted some of the aspects of communism such as his “Five Year Plans” South Korean society under his rule became, due to the continued threat of North Korea, intensely anti-communist.

Perhaps the best indicator of whether or not a dictator is “bevevolent” or not is the manner of his passing: Is he prepared to turn power over to the next generation so progress can continue, for arguably ― the prosperity that authoritarian rule achieved led to an increased clamour for political freedoms. Park and Chun are most reviled for their resistance to implementation of democracy and for their collateral human rights abuses. (Albeit, these were far less serious than Hitler and Mussolini, as noted above; neither Park nor Chun committed genocide or invaded anywhere). It is to the credit of Chun who had brutally suppressed pro-democracy forces seven years earlier that he handed over power peacefully, rather than resisting and prompting further bloodshed.

Yet negative legacies of authoritarian rule persist. The most outstanding is the ongoing weakness of rule of law. Dictatorships do not need law if they do use it, it is as a bludgeon against opposition. Democracies do. The lack of a fair and level playing field with equitable, predictable, consistent and transparent rules and strictures remains the most serious hangover from the authoritarian period. A byproduct of this is the ongoing problem of corruption.

Then there is education. One of the strongest achievements of the military governments was the prioritization, at massive expense, of national education. Numeracy and literacy were well taught. (A 15th century cultural factor was at work in the latter: Sejong’s script would finally prove a great enabler of universal literacy.) Education and more broadly, training, development programs promoted national ambitions. Diligence, discipline and “country love” were promoted. People were urged to work hard, to save hard, to buy only local products. This messaging worked. People did exactly these things, with the country working some of the longest hours in the OECD. It also created a fierce nationalism that could verge on xenophobia and which was easily leveraged by the country’s leadership in both the political and commercial spheres. Perhaps uniquely in Korea, even self-described leftists or liberals tend to have strongly nationalistic outlooks.

Education today remains largely unreformed; it continues to stress receiving, assimilating and then regurgitating information, rather than nurturing a questioning mindset. Combined with the short attention span of the Internet generation, education, by stifling intellectual curiosity, has spawned a vaucous popular culture easily seen in the celebrity buffoonery, soap operas and manufactured pop that dominates TV airtime. Educational reform ― the creation of a system that is more appropriate for a knowledge-based than a smokestack economy ― is now one of the most pressing issues facing Korean society.

A third problematic legacy is ideology. Under authoritarian rule, the left wing was heavily suppressed, resulting in radicalization. Today, there is a strong ideological split in a polity that is overly confrontational. Conservatives accuse liberals of being communists, liberals accuse conservatives of representing past dictatorships. There is little middle ground; moderate tendencies do not get a hearing.

Hardware and software

Korea’s early development was, not unnaturally, hardware driven. This legacy persists: The Korean government remains very, very good at planning and regulating infrastructure development ― as can be seen in everything from the Internet and mobile telecoms networks to Inchon International Airport. In infrastructure terms, South Korea which had, admittedly, a latecomer’s advantage is far better served than my own country, the UK, a G7 nation.

However, the heavy focus on “hardware” physical infrastructure, manufacturing industry, macro economics ― over “software” service sector, rule of law, micro-economics ― continues to plague both economy and society. Foreign businesspersons are often impressed by the physical facilities of Seoul or Busan, but surprised at some of the attitudinal barriers (nationalistic and protectionist) that they encounter

In the domestic economy, the hardware-software mismatch continues. Cultural exports the so-called “Korean Wave” have proved useful equity in Korea’s brand portfolio, and we can see a social shift underway in opinion polls, which show how many young people are now more interested in entering show business as a career, rather than becoming a salaryman in a conglomerate. Nevertheless, there is still a dominant concept that large segments of the service sector most particularly leisure and tourism, which is, by some metrics, the world’s largest industry are “frivolous.” This sector remains under-invested, as can be seen in the massive overcrowding of leisure facilities such as beaches, parks and amusement parks, as well as the limited range of mid-range hotels in Seoul: The hotel sector caters well to international businesspersons, less well to international tourists. Mid-range, budget, boutique and niche tourism accommodation remains in short supply.

Another casualty of the hardware-focused economic development model was the virtual disappearance of Korea’s traditional sense of aesthetics. With old-fashioned housing seen as being inefficient, rural landscapes and cityscapes were transformed: Villas and apartments replaced traditional housing. This destruction of heritage has resulted in some of the ugliest architecture in Asia.

Companies and corporates

Park did not make the mistake that socialist leaders made, that of creating national industries. The job of business was given, not to bureaucrats, but to businessmen. These businessmen would prove to be some of the most critical factors in Korea’s success and today’s conglomerates are some of this country’s greatest assets. However, this was not free market capitalism as some outside Korea believe it to have been: It was a process that was centrally led and centrally-directed by a skilled and powerful bureaucracy.

This dirigiste economy nurtured a variety of imbalances. Commercial competency was no longer the supreme factor in management; the ability to form relationships with bureaucrats and government officials, in order to get access to capital, permits and projects, became a core skill. A spin-off was collusion and its handmaiden, corruption. The relationships built up during this period created an unholy bond between government, capital and business. The resultant inefficiencies were laid harshly bare in the 1997 crisis.

While the so-called “IMF crisis” is seen today by Koreans as a disaster for lifetime employment, it proved a godsend for the chaebol. Forced to break up their conglomerates and spin-off inefficient businesses, they had no choice but to focus on core competencies. The result was the creation of Korea’s first ever global brands. Pre-crisis, Hyundai, Samsung, Lucky Goldstar and the rest had been do-everything, ship-to-chip conglomerates. Post-crisis, champions such as Hyundai Auto, Samsung Electronics and LG Electronics sprang to international prominence as specialized and differentiated brands.

Business, like bureaucracy, leveraged education. The system of the 1960s was perfect for creating a worker class that was disciplined, ambitious, literate and numerate. Thinking Koreans now criticize both education and business for being unable to foster creativity Certainly, it is striking how many Korean patents are for incremental, rather than blue ocean innovations: A thinner display panel say, a faster semiconductor. Yet this model has served Korea extremely well. I see no evidence suggesting that Korean companies need to change their paradigm: They have done brilliantly by focusing not on new product innovation, but by copying, improving, manufacturing and marketing. They have now risen through the ranks to the point where Samsung and LG cellphones are tier 1 brands, and Hyundai is now, a strong tier 2 automaker.

The downside is that Korea is today saddled with over-powerful business groups that are excellent companies but very unpleasant corporates.

Their abuse of SMEs is well known and the chaebol founding families continue to flourish, despite their continual power abuse. Be it defrauding shareholders, embezzling funds, bribing officials or even kidnapping and torturing barmen, these persons are, like the royalty of old, above the law, and continue to pass wealth and power down the generations.

Why does the Korean public put up with them? There seems to be the concept that the founding families deserve the extraordinary status they enjoy on the basis that they were/are companies rather than national enterprises which developed the nation at their own expense and at their own risk. Yet much of their success stems heavily from the preferential access they enjoyed to state projects and particularly to state-lent capital ie taxpayers’ money. So the chaebol had the benefit of being de jure private businesses, but with many of the de facto advantages of state-run enterprises. While the first generation chaebol leaders were brilliant entrepreneurs, the achievements of the second and third generations are more questionable.

The reluctance of the judiciary to punish chaebol management on the old-fashioned argument that their work is essential to the national economy ― ergo, the economy is more important than justice ― is invalid: Any chairman who makes himself indispensable is placing his company at tremendous economic risk. Moreover, it is far from clear whether the chaebol are successful because of their current generation of chairman; the argument could be made that they are successful despite them.

With judiciary and media (see below) both compromised, the end result is that senior business figures face few checks or balances.

Democracy and excess thereof

While most commentators tend to focus on Korea’s economic success story partly, perhaps, because it is easier to find statistics and metrics that chart the progress equally astonishing has been its democractic development. Demands for democracy date back to as early as 1960. The spark continued through the authoritarian years, culminating in the People Power revolution of 1987. In the years that followed, democracy flowered across society, to the point where Korea now is one of the most vibrant democracies in Asia.

The problem now is what might be considered “excessive democracy.” Political leaders are frequently unwilling to make hard decisions that go against the wishes of vocal interest groups. Bureaucrats and elected officials are incredibly sensitive to press criticism. The result is that leaders are, in fact, led. Populism and political grandstanding reigns, to the point where minority parties feel it their right or their duty to impede actual democratic process in parliament.

Meanwhile, that critical check in a democracy, a free media, is compromised. On the one hand, government influences the state-run broadcasters. On the other, due to their vast advertising budgets, and the relationships such monies engender with senior editors, business has considerable control over what goes into newspapers. This has created a dangerous situation. With neither the legal system nor the media able to control them, senior business figures are called, with no irony, the most powerful people in Korea.

Koreans are imbued with a powerful sense of personal entitlement. Demonstrations, a legacy of resistance to authoritarianism, are widespread outside government and corporate offices. These take place regardless of the convenience of the wider public; obstruction and noise pollution is rampant. Unions, so long suppressed under authoritarian rule, are militant and demanding. The judiciary that is unwilling to punish management for corporate crime is equally unwilling to sanction illegal strikers, and the police are forced to handle violent demonstrators with kid gloves.

Liberalism and entitlement

On the heels of democratization and with ever-increasing levels of prosperity, Korean society is liberalizing, diversifying and losing its rougher edges. From the 1960s to the early-1990s Koreans could not travel for tourism purposes. The lifting on these restrictions in 1992 fuelled demand for foreign language instruction, foreign food and restaurants and foreign products more generally. It has also ameliorated some of the xenophobic sentiment of the 1980s. And a massive number of Koreans now study abroad, creating an educational budget deficit but bringing important news skills and ideas home.

As Korea moves into the millennium, we are seeing increased social liberalism and diversity. Some positive aspects of this include: The ever-increasing role of women in economic activity; an increasingly accepted gay community; an ever-growing racial minority as foreign brides are imported into the country; and an understanding of the rights of racial minorities.

The extended family is no longer central to Korean identity and habitation; the nuclear family has come into being. With ever-increasing prosperity and consumerism, there is a strong sense of personal freedoms and consumer entitlement. To put it another way, the current generation are making up for the austerity suffered by the previous generation. In a holdover of the “economy first” prioritization of the authoritarian years, there is heavy, perhaps excessive, focus on personal wealth, leading to cutthroat competitiveness and an urge to “get ahead:” corruption has crept through all levels of society, all the way down to the school classroom. As noted, the traditional Korean aesthetic, which prized restraint and an underplayed austerity has been destroyed, replaced by a culture of ostentatious display, as seen in the prevalence of branded products and cosmetic surgery. Likewise the stereotypical stoicism of Koreans, which so impressed Korean War-era soldiers, has evaporated, replaced instead by emotional display. These concepts are mirrored in popular culture. A corollary of this sense of personal entitlement and prioritization of individual freedoms is that fewer young Koreans are willing to take on the (expensive) responsibility of marriage or parenthood. The end result: The nation is now one of the fastest-aging societies on earth.

Conclusion

Korea’s development economic, political, social occurred at probably a faster pace than any 20th century nation. It is only natural that there were collateral negatives along with the many positives. Many of the negative byproducts are self-correcting. There remain, however, some areas of Korean society where the legacy problems caused by fast-track development persist. These include:

- The extra-legal powers enjoyed by the chaebol top management
- The inability of the law to reign in protestors, strikers and demonstrators
- Lack of transparency
- Corruption
- The ongoing division of the peninsula
- The authoritarian governments, and resistance thereto.

Yet it is fair to say that virtually all these problems with, perhaps the exception of the last three points are ameliorating. While the improvement might not be as fast as some observers wish, the trajectory is in the right direction.

If the foregoing presentation sounds overly critical, I apologize. Despite the downsides, South Korea, is in my opinion, the greatest national success story of the 20th century. What makes living in Korea so exciting is that the acceleration continues. We had economic development in the 1960s and 1970s; political development in the 1980s and 1990s; and we are seeing social development in the millennium as the country embraces diversity of opinion, diversity of culture, diversity of gender and diversity of race. While Korea’s story may be populated by anti-heroes, it is, speaking more broadly, one of zero-to-hero and, today, from hero-to-superher