Just when you thought things couldn’t get any worse. The S. Korean government is considering financing “inter-Korean cooperation” by cutting the defense budget.
In a memo, the ministry detailed several possible ways to raise funds, saying that the government may need to come up with more financial resources if the summit brings about a number of large-scale economic cooperation projects between the two Koreas.
It also said the government may consider diverting part of the defense budget to finance inter-Korean projects.
About 26.7 trillion won was allocated for the defense budget next year, up 9 percent from this year, despite eased geopolitical risks associated with North Korea.The Defense Ministry said a significant increase in its budget is necessary as the country needs to modernize its forces to prepare for uncertain security conditions in Northeast Asia.
Now, if both Koreas have worked out concrete measures for reducing their forces and tensions along the DMZ, yes a reduction in the defense budget could be considered, but siphoning off the defense budget, when there are no reduction in tensions, to top-off KJI’s Swiss bank account? The progressives have definitely lost their minds.
As for our Dear Leader, he’s probably laughing out loud at the thoughts of all the free goodies heading his way and thinking about out what more to get from Roh, since Roh will obviously say yes to all of them.
But wait, there’s more.
Also, the memo indicated that the government may contemplate creating new taxes, which could be dubbed as either a “peace tax” or “unification tax,” as well as issuing lotteries and bonds to raise funds for inter-Korean economic cooperation.
The funds for facilitating economic and humanitarian exchange with North Korea increased by 50 percent to 750 billion won next year from this year’s 500 billion won.
So, now Roh and his minions are considering more taxes in order to fund their inter-Korean fantasies. That will surely sit well with the ordinary Korean taxpayer.
Of course, this is election year, and the government is attempting some damage control
However, the Planning and Budget Ministry downplayed the significance of the memo, saying that the contents were just various options that could be contemplated for the long-term.
“It’s true that there was a memo. But it’s just an internal one for long-term review,” a ministry spokesman said. “We are just at the initial stage of collecting opinions from various fields.”
We’ll see. But the sooner Roh and his progressive flunkies are thrown out of office the better. Now that I think about it, a while back baduk posted a comment stating that the objective of Roh and his followers was to sell off S. Korea to the N. Koreans. Of course everybody at that time had a good laugh about it. But, after reading the above article, why do I get the feeling that baduk’s comment is becoming reality?
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Here is another fact Mins and that is that South Korea has the quickest growing tax burden of any country in the OECD.
I suspect that these new taxes will not come to past.
#1.
I hope you’re right, R. Eglin. What the ordinary Korean does not need is more taxes especially those that are going straight into KJI’s pocket.
A peace tax to fund your enemy’s war machine… Joseph Heller would be proud.
Holy Stockholm Syndrome, Batman!
It’s a very risky gamble, but it might actually work. A post KJI North-Korea seems to be just around the corner. It looks like he will be replaced by one of his children (all of which have studied abroad… or at least, the ones we know of). My guess is that by increasing its financial investment in North Korea, South Korea is buying influence away from China. It would place them in a position to negotiate favorably with the new leader… if KJI is replaced by someone who is willing and able to open up North Korea. I would guess that his children would be willing to do so, I’m just not convinced that the North Korean hardliners would allow it to happen.
I wonder how the US taxpayer’s $50 billion subsidy to South Korea looks in comparison to the this move.
An absolutely mind-boggling level of idiocy. SK should really define what its strategy is. While the rest of the world has disengaged with NK, the country is increasingly oriented toward China and SK, but in different ways.
China is actively trading with NK at the company level. Just plain old business, old fashioned capitalism. And China is NK’s largest trading partner, imports and exports. Drugs, supernotes and weapons are becoming less a part of NK trade, and real consumer products are taking over.
SK, on the other hand, much prefers aid to trade. Whether in the form of directly handing over cash to KJI or sending him trainloads full of food and fuel, SK is just acting to keep economic control in the hands of the tyrant.
So, if the strategy is to help the Norks live better lives, the Chinese are doing way better at it. If the strategy is to just keep up an endless policy of ‘engagement’ with the tyrant, then I guess we’re doing alright.
http://www.ft.com/cms/s/0/8165.....fd2ac.html
http://www.iie.com/publication.....archID=794
I would support the increase in aid if the SK government stops with its hollow rhetoric regarding the North (especially comments like those made by the Unification Minister) and make special conditions for the money- such as increased human rights, arms cut, etc.
With that said, I still think the South should continue with its aid to the North. Remember, the dying people of North Korea are the real victims of the regime- don’t ignore them. Even if half the aid goes directly to the government, at least some of it will go to the people.
Yes, brilliant. Cut the military and give the cash to KJI to do as he pleases. And all because the US provides the military support. Roh’s governmemt always whined whenever the US asked them to help shoulder even a small part of the heavy financial burden of that support. Luckily, this is the dying wish of an incompetent lame duck administration made up of socialist losers and communist bootlickers and will fail to be passed, as I hope they are ridden out of town on a rail in a few short weeks.
defense budget cuts???? arent they supposed to be increasing in preparation for operational war time control????
these guys are clueless
what the hell do they want?
The Korean left wants to hand entire South over to Kim Jung Il. They believe that North Korea, not South, is the legitimate government in the pennisula.
They believe in Kimilsunism/Juche stuff.
This is no surprise. If Mr. Lee does not win the election, it will be all over for South. Hopefully that day would never come…
Roh’s exit from office cannot come soon enough. And he just may have overstepped the good graces of the S Korean people, even the Anti-American ones, with this one. People would forgive him if he siphoned money off somehow, but something so out there as a special tax has gotta be too much.
‘Internal memo’ my ass, this was purposely ‘leaked’ to float the idea.
hard to believe this report. is this really good for the roh camp during election time?
doesn’t seem likely. higher taxes is never popular. maybe they were really talking about reducing military budget. but forces that be would never like that.
but if they were serious… then they must really think that kji is about to keel over.
“China is actively trading with NK at the company level. Just plain old business, old fashioned capitalism. And China is NK’s largest trading partner, imports and exports. Drugs, supernotes and weapons are becoming less a part of NK trade, and real consumer products are taking over.”
I’m curious as to what North Korea is selling China. I watched trucks roll across the bridge at Dandong, and from what I could see, the traffic was mostly one-way: large flatbeds loaded with crates of foodstuffs and industrial products like pipes. I wondered what North Korea could possibly trade China in return. There’s not much in the way of manufacturing in North Korea, and if they’re trading raw materials, I’m surprised there’s anything left to trade.
Sonagi,
http://papers.ssrn.com/sol3/pa.....id=1008902
The companies are of course Chinese companies (and small ones at that), the North not having any. North’s exports still include a lot of labor. Prof Lankov also sat at that border and watched the trucks. He said that small-scale Chinese manufacturers seem to have Norks do some light assembly, textile work, that kind of stuff. With the nation’s whole current account coming to US 2 billion only, just about any commerce becomes significant. Above document doesn’t mention raw materials.
Ha! Come to think of it, that’s the same kind of work that still goes on in basements throughout 해방촌 every day, an area which apparently got its name from the number of North Koreans that used to settle there.
Thanks for the link, Linkd. I’m surprised that China would make significant FDI in North Korea, for China’s northeast is economically moribund, and even private investors would need state approval. I wonder where those manufactured goods end up.
Oh, it’s probably nothing so formalized as to deserve the title “FDI”. With the South, you can specifically quote levels of gov’t aid based on press releases. You can also measure commerce, since it all flows through official channels and Kaesong. But on the Chinese border, it’s just normal people trying to make a living, trading kitchenwares, clothes, TVs and cell phones, and with both governments usually looking the other way. The charts show how much error there is in the guesses for NK/China trade. Still, it adds up to more than total SK gov’t aid to NK. Probably more important than the products traded is the information that the Norks get from and about the outside world.
“But on the Chinese border, it’s just normal people trying to make a living, trading kitchenwares, clothes, TVs and cell phones, and with both governments usually looking the other way. “
That’s the part that puzzles me. Chinese-made goods are popular in North Korea, but I don’t recall seeing in China or hearing of any products made in North Korea, save for overpriced cigarettes and liquor sold at North Korean restaurants and souvenir shops.
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