But this key money thing is brutal. The effect is that every family that doesn’t own a home ties up several years’ worth of income in a non-interest bearing deposit. Same goes for most commercial property. This massive chunk of change largely ends up in banks, who largely lend it to chaebol, who, per the above, destroy it slowly.

If that money could somehow be pulled back out of the chaebol and turned back to the country’s citizens, I think that would be a pretty welcome bit of “redistribution”. End part 2.

does anyone seriously have a better plan for distributing the nation’s wealth and resources over the long run? Let’s hear it

Since you ask:

Some measures to end the value-destroying economics of the chaebol. Looking at their books (such as they are), chaebol after chaebol reports profit margins of about 5%. This, in fact, is not profit (no value added), as it doesn’t even cover their cost of capital. Considering the size of their assets, we could literally liquidate most of the chaebol, sell off all their assets, and put the money into T-bills or bank CDs, and make more money than the chaebol have shown themselves capable of generating.

How to fix? A few ways: end cross-shareholding, require consolidated financial statements, enforce majority outside Diretors of the Board. Why? Because their dividend payout ratios are abysmal. Most of their reported profits get parked in “Retained Earnings”, which increases their paper assets, but doesn’t benefit common-people shareholders. It doesn’t put any more cash into circulation. As their assets grow, their return on assets shrinks. If their true finances were revealed, and outside Directors in majority on the Boards, then these profits could be distributed to shareholders. Everyday Koreans, that is.

They typical listed chaebol company is about one-third owned by the “family”, another third by foreigners, another third by Koreans. That’s a thrid of Korea Inc.’s export profits that could be distributed to all the Koreans out there who have pieces of mutual funds. End Part I.

I know full well that Seoul is not Korea. In the six years I lived in Korea, I spent about a grand total of maybe 10 nights within 80km of Seoul.

But again, I’m still failing to see how a canal is going to keep anyone in the countryside, especially in the countryside away from the canal. That’s my point… the thinking about this canal seems to be along the lines of “canal … profit” without too much thinking about what exactly is going to go in the middle there. Again, if someone comes up with a reason why digging a canal would be a better idea than changing the trillion or so won that the canal would cost and using it to build a road paved with 10 won coins (or a trillion won in tax breaks for companies that build production facilities outside Seoul, even) then we’d be getting somewhere. Realistically though, unless you’re actually going to dig the canal around Seoul and fill it with piranhas, I don’t see how it’s going to keep people from emigrating away from the countryside.

This is NOT ABOUT SEOUL. It’s about the rest of Korea.

We and many Koreans need to let go of thinking in primarily Seoulite terms and think more in national terms. Seoul is not, I repeat, is not Korea; it is simply the largest city in Korea.

And, I dare say, the canal may foster new forms of enterprise we have yet to see as local people reassess what they can do locally and profitably.

To consider developing the countryside as being a waste of resources, or to take at face value exaggerated dreams of a few or this is a simple “ditch digger” activity, does a disservice to a large number of rural Koreans

I still fail to see how criticism of digging a canal/ditch somehow considering the development of the countryside as being a waste of resources? If we’re really worried about wasting resources, where’s the scrutiny of how much this will cost, how likely it is to pay for itself, how likely it is to be completed (remember that presidential terms are only 5 years long) and so on… Fairly speaking, it should be incumbent upon Mr. Lee to offer up some facts and figures for the people and be open for comment as to better ways to spend the money.

I’d also take issue with the idea that a canal is somehow going to draw people and capital out of Seoul to spread out along the countryside. After all, a canal is by nature only going to bring any kind of development to a very narrow path, not to the countryside in general. Sure, you might end up extending the sprawl of Seoul out along the canal path as condos and officetels pop up to take advantage of what I’m sure will be a lovely view (assuming it’s not just a dirty ditch), but how far is that facade of prosperity going to extend out into the countryside? A few miles? What will we find once we walk on away from the canal, past the Canal Venus Prince (Worldcup 88) love hotel? A countryside that’s better-off for having a canal dug through it?

Is Hyundai going to move their world headquarters from wherever the heck they are (probably Seoul) to Mungyeong? Will Posco open up a new steel mill there? Scenic waterways notwithstanding, what would be the advantage?

I agree with the above comments regarding deregulation of land use. But I wonder if regulation is the major hold back. But this not to say government has no responsibility when it has passively, de facto encouraged the best of Korean youth to migrate to primarily one city in search of opportunity.

I find amusing the comparison of what has been done in Ireland with Disneyland by a person whom I suspect has more likely ridden the Matterhorn roller coaster than a boat on Ireland’s Shannon-Erne Waterway. Score another point for that mindset!

We can have honest disagreements about the wisdom about the canal in general. But to assume someone, such as 2MB, who has decades of major construction experience, is not bringing specialists into the project — even at the conceptial level, which is the standard M.O. of every major construction undertaking to be incredibly naive. Don’t you think he would cover his tail before making such an audacious proposal? This is an area he has a hell of a lot of experience. But hey! who is he to argue with experts who spend their free time blogging?

No one has said that “developing the countryside” is a “waste of resources”, as you put it, rather, there appears to be a rush for riches going on without the benefit of enough serious research and planning having been done. It is not arrogant for people who have seen and experience long-term government-sponsored waste and misdirection (saemangeum project) to be more than a little bit cynical and to ask questions.

Currently, to make a short list for demonstration purposes only, some of the most obvious and pressing issues facing Korea are to be energy development, the rising cost and shortage of grains such as soybean and rice. One could start by considering parts of the country that might used to address these concerns (this is already being done, even as I write). Already out-lying parts of Korea are home to research in alternative forms of energy and more places that are compatible to such uses can be utilized. Even in places like Texas there is a new push towards wind energy and it is more than feasible already, for example.

Already as “sanshinseon” has mentioned, one great tourism plan that could be realized without a tremendous outlaying of money would be the bike and hiking trail that would be like Korea’s Appalachian Trail in America and, when combined with the various temples that are along this route, could offer a unique opportunity for cultural tourism. This trail would run the length of the country and, though not as glamorous as a “grand” canal would be less of a logistical problem to deal with. It would take a reputable public relations effort to promote this and the political will to see it done and maintain its effectiveness. Actually, Dave Mason should be writing about this rather than me since he is intimate with this subject and knows much more than I do but this plan could be refined even further.

Frankly, a focused return to developing better agribusiness policy and a focus upon organic farming and fertilizers would help people in the country-side as well help Korea in regards to the looming problems with importing grains and the world-wide shortage of such. Already LMB’s government is promoting organic fertilizers more since this will help Korean farmers to deal with the steadily growing price of chemical fertilizers and could help position farmers that want to go organic, due to the increased interest in organic foods domestically and internationally. If Park Chung-hee took Koreans out of the country-side, then it may very well be time to return to it, due to the increasing concerns over such. I’m hoping the new Minister of Agriculture will have better ideas about such because this issue will become more than just helping out Korean farmers in the future.

I could go on but then I would be spending much more time doing diligent research and no one is paying me for such. Public awareness and the discussion of these issues do indirectly help though and I am all for that.

That said, I’ve said from the beginning that if this proceeds, it’ll be the world’s most expensive Disney ride, and your bit on the Irish canal backs that up. It’ll be used for tourism, as it won’t be practical for transporting much in the way of goods. However, I’d rather not see my tax won put to this use for tourism.

However even with that done, I think we need a dose or reality. So what if the agricultural regions die? It’s really the progression of economic development at this stage. I find nobody crying about the slow death in rural North Dakota, let alone the need to build a Missouri-Lake Superior canal.

Korea is going to have to face it sooner or later, they are no longer a nation of pastoral farmers. Farming here, or at least how it done under current regulations, is inefficient and those resources (including the human resources) can be better allocated by the economy.

Tom – someone should encourage the former Grand Marshal of Seoul’s St Patrick’s Day Parade [sic: 2MB] to send some of his officials to visit the Shannon-Erne Waterway – I had the pleasure of being involved with some community development projects associated with this real success story – the projects, such as the building & managing of berths for riverboat cruisers/boat hire companies/visitor centres, etc. all had to be owned by the local community, have a cross-community dimension, a cross-border dimension if possible as well as long-term economic viability.

If these conditions were met believed to be in place, the IFI put its money (mostly US funds to begin with) on the table first, & sent in experts to work with the local community – in some cases over a number of years - to bring disparate groups together. In some cases this was as basic as facilitating dialogue between those most politically divided such as ex-prisoners, etc.

Of course one effect of the refurbishment of the canal was that private sector money followed very quickly. If a project like the S-E Waterway can help bring people who have been in political & agrarian disputes for hundreds of years, maybe something similar might be possible in Korea – I have always thought of this as a possible model for North-South co-operation in Korea but the same might apply for inter-provincial collaboration!