Thursday, December 20, 2007

Culturist Thought of the Day - South Korean Election

Lee pounded Roh in the Korean election. We can learn from others.

Lee swept to victory over Roh's successor due to domestic concerns. Roh ran a populist government. His message was tax the rich and give to the poor. One of his taxes was a 60% tax on profit from selling homes. He also disallowed loans to people who had 3 or more properties. These stopped construction and sales. People wouldn't sell and home prices soared.

Furthermore, Roh's tax increases were arbitrary. When people wouldn't sell because of taxes, he introduced a tax that penalized people for not selling. They had to pay a tax on potential profit! Few people wanted to do business in such a radical and unpredicatble atmosphere. The economy was tanking.

Populist politicians are dangerous. We should not take it for granted that we have a system that limits the president's ability to make law. In a multi-ethnic nation such as ours, populist leaders can be even more destabilizing. Korea not having diversity, they rode this one out. Cultural unity is not always a bad thing. Even the poor ended up voting against Roh's successor. Roh eneded up, for all the wrong reasons, being a uniter and not divider.
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