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[Editorial] Problematic budget

Government draws it up easily; lawmakers use it to add pork barrels

By Korea Herald

Published : May 23, 2018 - 17:35

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The supplementary budget that passed the National Assembly this week was dogged by controversies and upsets from beginning to end.

The administration drew it up without working hard to tackle unemployment problems on a fundamental level, and lawmakers passed it after deliberating it only superficially.

The 3.83 trillion won ($3.52 billion) budget was drawn up to curb youth unemployment and support some regions where massive layoffs took place in stagnant industries such as shipbuilding and automobiles.

It could offer a little help to depressed regions including Gunsan and Tongyeong, which have been hit by large-scale restructuring at car factories and shipyards, but given the relatively small amount of support (1.1 trillion won) and the persistent downturn of overall business in the industries, the budget can offer nothing more than first aid.

The primary reason the government cited for the budget is the unemployment crisis faced by echo boomers -- the children of baby boomers.

With the budget, the government will give 50,000 won in transportation expenses each month to young employees of remote small and midsized companies, and subsidize wages by up to 9 million won per regular employee hired by a smaller business.

But it is questionable if such subsidies will be able to attract many youngsters to smaller enterprises and retain them.

The majority opinion among economists is that youth unemployment has stemmed from more structural problems related to “growth without employment.”

The supplementary budget was submitted to the parliament on April 6 but screened for only three days from May 18 due to partisan politics.

Rival parties fought over the budget bill and the special counsel bill for the investigation of an online comment-rigging scandal. They eventually agreed on a simultaneous process for both bills on May 18.

Under time pressure, the bill skipped half of the 10 related standing committees to the Budget and Account Committee for final review, and passed the parliament in a plenary vote.

During the review, the budget bill was adjusted to leave out some job programs and include lawmakers’ condescending budgets for pork barrels, which have little to do with youth unemployment.

Seven road and railway construction projects were included in the bill, though the government did not request them.

Lawmakers even added budgets for air purifiers in day care centers and halls for senior citizens in their electorates.

Politicians seemed to have their eye on the June 13 elections rather than the primary goal of the budget, which is to curb youth unemployment.

Too often the passage of a supplementary budget has been an object of political bargaining.

Lawmakers have reviewed it halfheartedly, while taking out some items and instead adding budgets for showy projects to win over their constituents.

The first supplementary budget of the Moon Jae-in administration took 45 days to get approval from the National Assembly, and it was reviewed for only eight days. The second extra budget compiled this time took the same number of days to pass the Assembly, including three days of screening.

An extra budget is drawn up to meet sudden and urgent needs, so the timing of its execution is important.

But the timing has been missed repeatedly, not to mention the hasty screening.

Though an extra budget is small in scale compared with the main annual one, sufficient time must be given to its examination. They are the same in that both use taxpayers’ money.

As for job budgets, the Moon administration drew up a 11.03 trillion won supplementary budget last July and earmarked 19 trillion won, up 12.6 percent from a year earlier, in the 2018 budget.

As the major reason for the second extra budget, it cited a sluggish employment increase and high youth unemployment.

The government cannot continue to draw up an extra budget each time unemployment rises. If spending taxes is the government’s policy to reduce unemployment, it will neither be effective nor sustainable.

A supplementary budget must not be seen as an easy policy tool for the government nor a chance for lawmakers to add to pork barrel spending. Enough is enough for this kind of extra budget.