Shim Jae Hoon at PostGlobal

Shim Jae Hoon

South Korea

Shim Jae Hoon is a Seoul-based journalist and commentator writing for a variety of international publications including YaleGlobal Online, The Straits Times of Singapore, The Taipei Times and Korea Herald. He was a correspondent for Far Eastern Economic Review in Seoul, Taipei and Jakarta. Close.

Shim Jae Hoon

South Korea

Shim Jae Hoon is a Seoul-based journalist and commentator writing for a variety of international publications including YaleGlobal Online, The Straits Times of Singapore, The Taipei Times and Korea Herald. more »

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South Korea's Real Beef

SEOUL - By apologizing for mishandling the beef import issue with the United States, South Korean President Lee Myung Bak has averted a major political crisis that threatened to undermine the stability of his young administration. In a nationally televised speech on Thursday, he promised to ban imports of American beef from cattle older than 30 months of age, accepting the argument that younger cattle are less prone to mad cow disease, and therefore safer for Korean consumers.

But whether this new import rule, subject to agreement with the U.S., will end many weeks of street protests in Seoul remains doubtful. Underlying the recent political unrest are a variety of factors, including Lee’s controversial leadership style. The concern over mad cow disease may certainly be genuine, but as demonstrators freely concede, it has also been useful as a cover for expressing other discontents.

One of them is President Lee’s propensity to make decisions based on consultation among his narrow circle of advisors. He lifted the ban on American beef imports in April, imposed since the 2003 outbreak of the mad cow disease in the U.S., on the spur of the moment, his critics say, on the eve of visit to Washington for a highly publicized meeting with US President George W. Bush. That speedy decision, reportedly made without much consultation outside the government (the strong farm lobby, for example) triggered the feeling that he was pushing his political agenda by risking consumer safety. With his judgment now in doubt, his leadership as president has been considerably weakened.

Next was the quality of people he picked for his first cabinet, which critics promptly labeled a “rich men’s club” of officials holding a large sum of assets in land and housing, reportedly acquired through speculation. Their image as members of the privileged establishment, rich and well-connected (some were attacked for dodging Korea’s compulsory military service,) provoked particular resentment in the center-left constituency of the underprivileged and unionized workers.

Faced with mounting attacks, Lee has promised to replace some senior officials, severely damaging their reputations. President Lee has been so shaken by the backlash against his appointees that he has pledged to choose cabinet members from among those holding less than a billion won (US$1 million) in assets. Judging people by this standard of wealth, his cabinet could very well be empty.

Public resentment against rich officials –- especially the perception that their wealth could have been built via illegitimate, if not illegal, means -- clouds the outlook on Lee’s otherwise legitimate policy goals, such as his campaign pledge to boost the sagging economy through tax cuts and deregulation. And yet, Lee’s business-friendly policy has been roundly denounced as a pro-chaebol policy favoring big business conglomerates at the expense of workers and small businesses. The center-left views this as a ploy to roll back its own reform plank achieved under the previous regime, such as equity-based distribution and egalitarian educational benefits.

How all this plays out in the months ahead should be of more crucial concern than the issue of American beef, which at most amounts to US$800 million a year. With so much passion pouring out on the street, and the opposition United Democratic Party fanning the flame, South Korean exporters must now risk a potential trade backlash from the U.S., which imported 700,000 Korean cars last year against exports of 5,000 U.S. cars to Korea, (along with electronics and other manufactures.) Emotions on the Capitol Hill have been so fired up, too, that Democratic presidential hopeful Barack Obama, House speaker Nancy Pelosi and Senator Hillary Clinton have all attacked Korea’s closed market, vowing to oppose the congressional passage of the U.S.-Korea Free Trade agreement signed last year.

Thus the beef issue throws a long shadow onto the future of bilateral trade. With President Lee now appearing to put his reform program on the back burner to recover his political peace, he is facing another wave of criticism, this time from the conservative business community, on his faltering leadership. His political compromise on reform, as well as on beef imports, presage a rough ride for the next five years under his government.

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