블로그 ( 오늘 방문자 수: 226 전체: 318,375 )
The Political Economy of Corruption in Korea(1)
chungheesoo

 

Corruption kills people; Corruption ruins the economy; Corruption violates human rights.

 

Joseph H. Chung (정희수), Ph.D., Professor of Economics at Quebec University in Montreal (UQAM)

 

 

Introduction

 The whole world is facing the deepening and widening corruption which challenges the very survival of the free democracy and the free market economy.

 Korea has been suffering for last 70 years from the corruption culture. But owing to courageous fight of Korean people and the Candle-Light Revolution of 2016-2017, Korea is freeing painfully but steadily from the dark clouds of the corruption culture.

 I hope that Korea's experience will help developing countries for assuring the development of their economy without becoming the slave of corruption.

 The literature on corruption is rich but it has two shortcomings. First, it is based on a definition of corruption which is too narrow to deal with the complexity of corruption. Second, it does not cover sufficiently the range of the impact of corruption on the society.

 Most of the existing studies tend to define corruption as illegal activities which are designed to maximize personal gains at the expense of those of others. But, it must be pointed out that some of the laws and regulations are designed to justify corruption.

 Therefore, I would define corruption as "illegal or immoral human activities designed to maximize personal or group gains at the expense of the welfare of other persons or other groups"

 The objective of this paper is to find, on the basis of Korea's experience, appropriate measures that would facilitate the fight against corruption.

 This paper has four sections.

 Section 1 offers a typology of corruption based on the Korean experience of corruption. I have found that the useful way of classifying corruption is to relate it to the behaviour of individuals and organizations involved in corruption.

 Section 2 deals with the evolution stage of corruption. I argue that the phenomenon of corruption evolves by stage. The level, the contents and the impact of corruption vary by stage. Therefore, to find appropriate measure of anti-corruption, it is important to know at what stage the process of corruption finds itself.

 Section 3 discusses the strategy of protecting the benefits of corruption. It will be shown that, in Korea, the strategy of protecting the fruit of corruption is brutal and sophisticated.

 Section 4 copes with the impact of corruption. Here, I will distinguish between economic impact and moral impact. It goes without saying that these two types of impact are related. In fact, I argue that these two types of impact combined can destroy a country

 Finally, Section 5 will show how the Korean people have fought for last 70 years against corruption risking their lives and enduring the violation of their basic human rights. In this section, I will show also how President Moon is conducting a total war against the deep rooted corruption in Korea. In addition, I will show some lessons we can learn from the Korea's experience of corruption

 

1. Typology of Corruption

 The corruption takes several forms depending upon the individuals and organizations involved in the process of corruption. I am sure that the following types of corruption take place in many other countries.

1.1 Outright theft of public funds

 One of the most notorious scandals in Korea is the embezzlement of billions of dollars of public funds by the conservative presidents of the country, civil servants, heads of public corporations, directors of research institutions, and even owners of even kindergarten.

 One of the notorious cases was the embezzlements of more than $ 200 million USD by former conservative president, General Chun Doo-hwan. He was imprisoned for corruption and abuse of power. He was ordered by the court to pay back to the government the embezzled money. But he was still claiming that he had only $260 USD in his bank; he is making mockery of Korea's judiciary system. He passed away this year without paying back the stolen money

 Under President Lee Myong-bak, billions of dollars of public money was suspected to be stolen through what are called the "4-River Projects" and "Resource Diplomacy." These scandals remain to be investigated.

 Another case of the theft of public money is that of private kindergartens which steal openly a good part of government subsidies for personal use including the purchase of jewellery and other personal use.

1.2 Transaction of privileges

 The market of privileged rights is huge. To do business, one has to go through a long series of regulations. But, by paying bribes to government officials, one can get privileges of going over the laws and regulations.

 For instance, by paying bribes to government officials, one can get more quickly a legal building permit or illegal building permit. With bribes, a land developer can transform greenbelt land into residential land.

 The supply of these privileges is provided by the public authorities. The demand of these privileges is determined by the business. The price of these privileges is the monetary value of these privileges.

 The market price of these privileges is the amount of bribery. It is by no means easy to have an idea about the amount of such bribery. But, for example, it is a known secret that the amount of bribery paid by the industry of construction is 5% of the amount of sales. The total amount of bribery could be tens of billions of dollars.

1.3 Theft of Information

 In Korea, some of those who are involved in the supervision of stock market and land development are known to be wealthy after their retirement.

 The high ranking civil servants of the ministry of construction know in advance the land-development plan and buy land in the name of someone else and assure huge capital gains by selling it.

 A person working at the institution which supervises the stock market has access to confidential information on investment plan of companies and can make fortune by buying or selling the stocks. God knows how much illicit money is made by these thieves of confidential information.

1.4 Fraudulent procurement

 The government and its numerous agents spend hundreds of billions of dollars every year to buy goods and services. For national defence alone, Korea spends a year $50 billion USD. It happens more often than not that the government and its agents pay an amount far above the real price for the procurement of goods and services.

 The difference between the price paid and the real price is shared between the seller and the buyer. This is the "kick-back". In the area of procurement of military equipment, the amount of kick-back is said to be 10% of the amount of military equipment bought.

1.5 Transaction of Freedom

 Perhaps, another devastating form of corruption is the transaction of freedom. Under the corrupted judiciary system, those who have committed crimes and corruption can buy freedom with bribe money. (다음 호에 계속)