The Board of Audit and Inspection (BAI) announced today that it has started a preliminary investigation to see if the Korean moneys paid for the upkeep of USFK are being used properly:
The probe is taking place while the South Korean government is waiting for parliamentary approval of its agreement to pay 920 billion won (US$866 million) for U.S. troops this year, a 5.8 percent increase from the previous year.
The move comes after a left-leaning civic group, Solidarity for Peace and Reunification of Korea, in October requested a probe into the fund use after data showed that the U.S. is sitting on more than 1 trillion won of unspent defense funds paid by Seoul.
The investigation is to mainly focus on whether there was any attempt to evade taxes on interest from unspent cash paid by Seoul, according to officials.
Yes, that would be this Solidarity for Peace and Reunification of Korea, led in part by that Kang Jeong-koo and a priest best known for illegally visiting North Korea. You’ll also recall that the lawmaker who’d been spearheading allegations of USFK “cash-hoarding” was none other than Rep. Lee Seok-ki.
Yes, that Lee Seok-ki.
[T]he money is likely being stockpiled in anticipation of whenever the big move to Camp Humphreys takes place. Moving all the servicemembers from Yongsan and the 2nd Infantry Division to Camp Humphreys is not going to be cheap. However, if you are a North Korean spy looking to create discord between the Korean public and the US military this is a great issue to demagogue.
Still, the fact that the BAI has decided to launch a preliminary investigation suggests that the public is insufficiently satisfied with USFK transparency. The recent cost-sharing agreement includes mechanisms to boost transparency, but the DP is promising to take a tough look at the agreement when it goes to the National Assembly for approval. You can read more about the “blowback” here.
It’s important to realize that it’s not just allegedly pro-North Korean elements raising the issue of transparency. The reliably pro-American Chosun Ilbo warns in an editorial:
Saddled with a huge fiscal deficit, the U.S. is trying to cut spending while focusing its strategy in Asia on Japan. If South Korea resists any calls to take on a greater share of the cost at a time like this, it may end up sidelined in policies involving Northeast Asian security and North Korea. It must therefore approach the issue from a diplomatic rather than fiscal perspective.
But an important point is whether there will be increased transparency in how the money is being spent. Washington has agreed to provide more information, but it remains to be seen just how much, since there is no legally binding clause in the agreement to ensure this.
The U.S. did not spend around W710 billion it received from South Korea as part of upkeep, but Seoul had no idea of this for some time. If this happens again, the South Korean public will only become more opposed to any rise in Seoul’s share of the cost. Both the U.S. and South Korea must be careful not to let the cost issue damage their alliance.
The likewise reliably pro-American Dong-A Ilbo also cites transparency concerns, and adds a demand that now that Korea is paying more to maintain USFK, the United States should make concessions on other security-related issues, by which it means Washington should agree to delay the transfer of wartime operational command
to the second coming of Christ and lift restrictions on Korean nuclear development:
The two countries have yet to hold negotiations over revision to the bilateral nuclear treaty and another postponement of the transfer of wartime operational control. On the nuclear talks, the two sides delayed the deadline by two years to 2016, but have yet to narrow major differences despite nine rounds of talks. The planned transfer of wartime operational control is scheduled in December 2015, but it is uncertain whether the transfer will be postponed again. How negotiations over these issues are concluded will determine not only Korea’s security but also the nation’s nuclear technology development and the future of export. Since Korea has made concessions in the talks over defense cost sharing, the U.S. should make sincere efforts to resolve the remaining issues.
The Hankyoreh, meanwhile, didn’t find much to celebrate at all. I do think its call for an itemized standard like Japan is worth considering, though:
The talks basically left in place the current framework, leaving the US with discretionary authority on how to spend the money once a total amount is agreed on. Many had called for a system more along the lines of the Japanese one, where spending is decided on an item-by-item basis as needed. It would have been worth the headaches to find a way of adopting an itemized standard while working to minimize the financial costs. It’s also unfortunate that they failed to produce any real answers on how to use the 1,352.3 billion won in previous defense contributions that haven’t been used.
Of course, if we end up itemizing like Japan, we might want to demand Korea start paying like Japan, too. Even under the most recently signed agreement, Korea is paying less than 50% of USFK’s upkeep costs. Japan, I believe, pays something in the neighborhood of 70% (please correct me if I’m wrong here), and according to the Chosun Ilbo editorial linked above, Tokyo was asking Washington to make Seoul pay more in accordance with its much-improved economic power.