Wednesday, April 02, 2008

neoliberal left, neoliberal right; or, market friendly left, chaebol friendly right?

Two stories in the Hankyoreh highlight a tension that I've seen coming for a while and which I have felt cautious about in my own writing here and elsewhere. That is the difference between the Roh and Lee regimes on economic policy. Undoubtedly, the Roh regime focused on trade and labour liberalization, corporate governance restructuring (in favor of shareholders and accountability), as well as some financial liberalization. Roh's policies were certainly 'market friendly' in a neo-liberal sense: a notion of the market best approximated by the neo-classical ideal of a free market of small and medium sized firms in perfect competition.

Now, Lee also claims that his policies are market friendly but that he is focusing on competition first. In other words he favors the domestic conglomerates and proposes to do away not just with rules designed to enhance transparency and competition in the way highlighted above but the very supervisory role of the state in guaranteeing the rules under which that competition takes place. Or so I gander from two recent articles in the Hankyoreh on the restructuring of the Fair Trade Commission and the Banking sector: changes to both reflect a rather reckless 'let the chaebol own what they want' attitude with none of the regulatory requirements of past regimes, including the dictatorships that Lee and others like him saw as rational economic planners who used state power to channel finance to industrial development -- that is not what is going on here.

Kim Jin-bang, a senior activist with the People’s Solidarity for Participatory Democracy and a professor at Inha University, blamed the FTC for “Its plan to ease regulations, despite a lack of plans for supervisions and punishments, which shows that (the FTC) may sit idly by if the market collapses.”

I guess the irony here is that the left, often cursed for the 'lost decade' of slowed growth since the 1997 crisis and criticised for being ideological (a la socialism) were actually better neo-liberals in the sense that their neoliberalism was more attached to actual economic ideals -- ones which I myself am very critical of as I see no invisible hand to economic life and worry about the forms of power masked by such rhetoric. Meanwhile the right seem not simply pragmatic -- as in 'let's see what works' -- in their policy choices but just corrupt and after power for their friends in ways that might be much more dangerous to the economy, environment and society in the long term. Similar issues to these are mirrored, I suppose, in the continued controversy over the new right's 'textbook' of revisions of the historical record and their shinning appraisals of past colonial and dictatorial regimes.

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