The Peninsula

Government Bets on People’s Sense of Civic Duty

This briefing comes from Korea View, a weekly newsletter published by the Korea Economic Institute. Korea View aims to cover developments that reveal trends on the Korean Peninsula but receive little attention in the United States. If you would like to sign up, please find the online form here.

What Happened

• Lawmakers are debating the scope of the proposed funds for relief from the COVID-19 crisis.
• The ruling Democratic Party (DP) argued for extending support to all households. But the administration and the opposition party opposed this proposal, citing strains on the state’s fiscal health.
• To persuade the administration, DP lawmakers proposed “voluntary contribution of the payouts by high-income earners” as a means to reduce the cost burdens of the disaster relief fund.
• On April 22, Prime Minister Chung Sye-kyun announced that the administration would accept DP’s proposal if the National Assembly reaches an agreement and comes up with a plan to make voluntary contributions of payouts possible.

Implications: The government’s belief that high-income earners would return their share of the emergency relief fund reveals policymakers’ trust in the Korean public’s sense of civic duty. Critics have pointed out that relying on volunteerism is not sound policy-making. However, DP lawmakers are confident that people will contribute their share if civic leaders and influencers set an example. In addition, there are tax incentives for those who take this action. DP lawmakers also point to ongoing public campaigns to raise money for the emergency relief fund as evidence of the people’s volunteerism.

Context: South Korea’s past experiences validate the government’s belief that people would make significant sacrifices. When the country’s economy ran out of foreign reserve currency during the 1997 Asian Financial Crisis, South Koreans launched a national gold-collecting campaign. In the first quarter of 1998, 2.43 million people participated in this campaign and collected 1.65 tons of gold which resulted in earning USD 2.2 billion worth of foreign currency to pay back the International Monetary Fund.

Korea View was edited by Yong Kwon with the help of Gordon Henning, Soojin Hwang, Hyungim Jang, and Ingyeong Park.

Picture depicting the 1998 gold collection movement from user ClubCapetown on flickr