Democratic Party Fuels Debate on 'Disaster Basic Income'... "Discussion Tomorrow (11th) at the Budget Committee"

Lee In-young, floor leader of the Democratic Party of Korea, is attending the joint meeting of the floor leaders' strategy meeting and the standing committee secretaries held at the National Assembly on the 10th, delivering opening remarks. Photo by Yoon Dong-joo doso7@

[Asia Economy Reporters Park Cheol-eung, Kim Hyun-jung, Jang Se-hee] The Democratic Party of Korea is igniting discussions on disaster basic income, which is spreading rapidly. Although the government maintains that it is not considering such measures, there are many voices in the political sphere advocating for it as an extraordinary countermeasure. It is expected that the Democratic Party will publicly raise the issue of basic income at the National Assembly’s Budget and Accounts Committee (BAC) meeting scheduled for the 11th.

On the 10th, a Democratic Party member of the BAC said, "There are many opinions within the party that basic income payments are necessary," adding, "At tomorrow’s (11th) full BAC meeting, we will discuss the introduction of basic income while examining the Ministry of Economy and Finance’s fiscal status."

He continued, "The supplementary budget consists of indirect support measures rather than direct aid and is being promoted within the scope of general economic stimulus, so a separate discussion is needed. Especially in Daegu, where the community is almost collapsed and in an 'all-stop' state, unprecedented support different from normal situations is required." A Democratic Party COVID-19 Special Committee official also said, "It is true that we have begun reviewing it from the perspective of verifying fiscal feasibility and effectiveness," but added, "It has not yet been decided whether targeted support based on region, estimated income, or occupation would be preferable."

The Democratic Party leadership is taking a cautious stance. On the 10th, Lee In-young, the Democratic Party floor leader, said at a party strategy meeting, "Voices calling for direct cash support through disaster basic income are growing, and there have been economic sector proposals, such as from the Korea Chamber of Commerce and Industry, to expand the supplementary budget to 40 trillion won," adding, "These are all urgent voices born out of sincere concern considering the severe economic situation. We will listen to these voices carefully and proceed with the supplementary budget review."

The issue of disaster basic income is currently being raised by individual Democratic Party lawmakers, but there is a possibility that discussions will intensify in line with public opinion trends. A Democratic Party lawmaker said, "The COVID-19 crisis is now spreading shocks to global stock markets and oil prices," adding, "From that perspective, there is a high level of consensus within the party on the necessity of basic income payments. We need to discuss this while listening to the public’s opinions."

According to a public opinion poll conducted by Realmeter on the 3rd at the request of OhmyNews, 42.6% supported the introduction of basic income, while 47.3% opposed it, a difference within the margin of error. Progressive respondents tended to support it, while conservatives mostly opposed it.

Seoul Mayor Park Won-soon requested the government on the same day to implement emergency disaster living expense support nationwide. He proposed a one-time payment of 600,000 won over two months, with 300,000 won per month, for all households below the median income who were not included in the current supplementary budget support.

Earlier, on the 8th, Gyeongnam Governor Kim Kyung-soo proposed to the government and the National Assembly that 1 million won of disaster basic income be paid to all citizens. Gyeonggi Governor Lee Jae-myung argued for prioritizing areas with significant economic damage like Daegu and Gyeongbuk, and 51 Democratic Party candidates outside the National Assembly, including former lawmaker Kim Min-seok, publicly demanded a uniform payment of 500,000 won on the 9th.

In the business sector, SoCar CEO Lee Jae-woong advocated for a 500,000 won payment through a Blue House petition on the 1st, and Korea Chamber of Commerce and Industry Chairman Park Yong-man said at a press conference on the 9th, "Some say that the growth rate could fall by up to 1 percentage point this year due to COVID-19. To compensate for this, nearly 40 trillion won is needed."

However, the government is reluctant. It argues that there is no legal basis for this in the Disaster and Safety Management Basic Act, and there has been no precedent for cash support due to disasters or calamities. Moreover, with the supplementary budget proposal exceeding 11 trillion won still pending approval by the National Assembly, the government appears concerned about fiscal burdens.

An official from the Ministry of Economy and Finance said, "There have been experimental basic income supports for the unemployed in some countries like Finland, but these experiments were eventually discontinued as no meaningful results were found," emphasizing, "In Switzerland, a national referendum also rejected it, and this type of support is rare both domestically and globally."

Another official pointed out, "There have been suggestions to finance basic income payments by increasing taxes on high-income earners, but it is difficult to find concrete methods, and the explanation that tax revenues will increase without tax law revisions if domestic demand expands is very vague."

Experts are generally negative but remain open to so-called 'pinpoint' support. Professor Sung Tae-yoon of Yonsei University’s Department of Economics said, "The effect would not be significant, and only the fiscal burden would increase," adding, "In terms of tax revenue procurement, consumption might actually contract."

Professor Kim Sang-bong of Hansung University’s Department of Economics explained, "It is difficult to secure more tax sources, and if this crisis ends, it could lead to overshooting," adding, "Currently, there is a strong tendency to consume only a part of disposable income and save the rest, so there should be no expectation of a consumption stimulus effect."

This content was produced with the assistance of AI translation services.