Asian finance, Korea

The Roadblocks to Reform in South Korea

BY

South Korean President Moon Jae-in is shaking up the country’s Constitution. His recent constitutional amendment bill proposes a presidential system that caps a presidency at two consecutive four-year terms while limiting presidential powers and strengthening the rights of the prime minister and the National Assembly.

In contrast to Moon’s proposal, the opposition parties (especially the main opposition right-wing Liberty Korea Party) have been advocating a semi-presidential system. In such a system, administrative functions and competences would be divided between a president elected by the people and a prime minister elected by the National Assembly (the prime minister is currently appointed by the president and merely confirmed by the National Assembly).

Moon’s proposal rejects, as does his ruling Democratic Party, the opposition parties’ call to allow the National Assembly to appoint or recommend the prime minister. Similarly, the opposition parties have shown no signs of willingness to cooperate with Moon, with the main opposition Liberty Korea Party demanding that Moon withdraw his constitutional amendment proposal.

Politicians across the political spectrum agree that their country’s five-year, single-term presidency is well overdue for reform. Many believe that the current 1987 Constitution and the established power structures based on it grant far-flung and difficult to check powers to the nation’s ‘imperial presidency’. The dramatic ousting of former president Park Geun-hye from office concretely demonstrated not just her flawed imperial presidency but also the overwhelming public demand for democratic and corporate/financial reform — both of which Moon promised to deliver during his presidential campaign.

Park Geun-hye’s unexpected downfall ironically precipitated the perfect timing and ready-made rationale for such constitutional revision.

Moon has so far succeeded in retaining an approval rating of 70 per cent or more, which he has achieved mainly by eliminating what he called ‘the culture of the authoritarian president’ through the prosecution of Park Geun-hye and another conservative former president Lee Myung-bak, as well as a string of high-ranking former officials under them. Though these tsunami-like arrests and indictments have appeased many South Koreans, albeit with mixed reactions to Park’s 24-year jail sentence, this does not mean that Moon will be able to push his ambitious proposal to amend the Constitution through the many political and institutional roadblocks without due process.

The most obvious roadblock is the extreme differences in direction and goal of constitutional reform between Moon’s Democratic Party and the opposition parties. Moon and the Democratic Party must actively negotiate — not just with the smaller opposition parties but also with the main Liberty Party of Korea — by agreeing to focus on eliminating South Korea’s political culture of the ‘authoritarian president’.

Park Geun-hye’s unexpected downfall ironically precipitated the perfect timing and ready-made rationale for such constitutional revision. Moon needs to seize the moment and convince the South Korean people of the revision’s merits — especially the older generations, who tend to be sceptical of Moon’s populist presidency and his equally populist constitutional amendment bill. They suspect the bill may merely pretend to eliminate the ‘authoritarian president’ culture and will actually inflate Moon’s own presidential power by expanding the power of the Blue House which, according to a progressive columnist of Kyunghyang Shinmun, is making both the ruling Democratic Party and the Cabinet a puppet of the Blue House itself.

The National Assembly is required to vote on the proposed constitutional amendment bill by 24 May and, if approved by at least 196 seats or two thirds of the current 293 lawmakers, Moon intends to put it to a national referendum during the general elections. The Liberal Party of Korea alone has 116 seats and can thus put a stop to Moon’s proposal. Unless there is miraculously decisive negotiation between the ruling and opposition parties, there appears little chance for Moon’s proposal to be put to a national referendum as planned.

Challenging the ‘authoritarian presidency’ is not the only avenue that Moon is pursuing to improve checks and balances on South Korea’s rulers. In terms of corporate/financial reform, especially to stop the hitherto prevalent cosy relations between political and business elites, namely,  chaebol (family-owned business conglomerates), Moon has not only vowed to end the use of presidential pardons for corrupt corporate executives, but also appointed Kim Ki-sik, former civic activist-turned-lawmaker, with the nicknames ‘chaebol sniper’ and ‘the Grim Reaper of the financial world’ as Head of the Financial Supervisor Service (FSS) on April 2.

Moon’s ambitious corporate/financial reform drive, however, lost momentum on the FSS leadership appointment when Kim resigned on Monday night (16 April), which the President accepted after the National Election Commission ruled that Kim’s three overseas trips sponsored by financial organizations, including the Korea Institute for International Economic Policy and Woori Bank in 2014 and 2015 were illegal. Kim’s donation of 50 million won ($US 46,577) to the Korea Institute for the Future, a progressive think-thank led by a group of former and incumbent lawmakers of Kim’s home Democratic Party, according to the National Election Commission, violated the Public Officials Election Act.

The main political and institutional roadblock that the Moon government faces remains regulation enforcement.

Kim’s resignation after just two weeks, the shortest in the organization’s history, not only marked the second FSS chief to resign in less than a month (after his predecessor Choe Heung-sik, a Professor-turned-businessman, resigned over an alleged involvement in employment irregularities), but also placed doubts on the efficacy of the Blue House’s vetting process. Kim is the eighth minister-level official chosen by the Blue House to resign from their post or withdraw before taking office.

In any case, the main political and institutional roadblock that the Moon government faces remains regulation enforcement. South Korea already has most of the necessary rules and regulations in place (even though many loopholes abound). Although some commentators speculate that the chaebol system may well only last one generation more (since many of the powerful chaebols’ executives are slowly being replaced by a younger and more progressive generation of leaders), chaebols’ deeply entrenched dominance in South Korean society has given them sway far beyond what many observers would imagine over politics, the economy, the media and the judiciary.

This is not to say that South Korea’s judiciary is expected to be a major stumbling block in the process of corporate reform, unless the chaebols decide to challenge the legality of specific measures, in which case the judiciary may well side with the chaebols.

If Moon wants to fix corruption and the excessive power structure of the imperial presidency in South Korea, he needs policies that can break through political and institutional roadblocks — doomed amendments and unenforced regulations will not be enough.

 

An earlier version of this article appeared in the East Asia Forum.

Featured image: The Blue House   Source: Wikimedia Commons

About Hyung-A Kim

Hyung-A Kim is Associate Professor of Korean Politics and History at The Australian National University.

Published:
18th April, 2018

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