Government Officials Troubled by Hong Nam-gi's Resignation... Party-Government Conflict Hinders Principled Administration

Unexpected but "What was bound to come has come"
Analysis suggests it’s a strategic move for party-government dominance
Party and Blue House overshadowed on tax and other issues
Experts unlikely to express their true opinions

[Image source=Yonhap News]

[Asia Economy Reporters Kwangho Lee, Sehee Jang]"I take full responsibility and hereby announce my resignation and submit my letter of resignation today."

Since the news of Hong Nam-ki, Deputy Prime Minister and Minister of Economy and Finance, expressing his intention to resign broke out on the afternoon of the 3rd, the atmosphere in Sejong government offices has been unsettled. Everyone was shocked by the timing and manner of the unexpected submission of the resignation letter. However, the general reaction to Hong’s resignation was mostly "what was bound to happen has come." It is said that some staff members even shed tears. A government official said, "There is much to say, but I will refrain from commenting."

When his position became a subject of controversy, Hong Nam-ki appeared before the National Assembly’s Budget and Accounts Special Committee on the 4th and stated, "I will do my best to perform my duties as Deputy Prime Minister in accordance with the will of the appointing authority." Hong said, "I sincerely expressed my intention to resign (the day before), and I deeply regret the opposition party calling it a political show," adding, "There was absolutely no such intention."

◆Emotional Sejong Government Offices: "What Was Bound to Happen Has Come"= The direct cause of Hong’s resignation was the conflict between the ruling party and the government over the major shareholder criteria for imposing capital gains tax on stock transfers, but there is growing analysis that accumulated dissatisfaction over time finally exploded. Some speculate that this was a deliberate shock therapy intended to rally the demoralized government atmosphere and secure a favorable position in future ruling party-government conflicts.

Hong was appointed in November 2018 as the successor to former Deputy Prime Minister Kim Dong-yeon, who stepped down amid conflicts with the Blue House. Kim had frequent disagreements with former Blue House Policy Chief Jang Ha-sung. One of the main reasons the Blue House chose Hong was his ability to coordinate work between ministries. After taking office, despite controversies over being "passed over," Hong emphasized policy coordination with the Blue House and the ruling party, striving to minimize discord. As a result, he earned the title of the second longest-serving Deputy Prime Minister for Economy in history.

However, this year, Hong appeared to be increasingly sidelined by the ruling party and the Blue House on key policy issues. He conceded the national treasury on major issues such as the emergency disaster relief fund for all citizens amid the COVID-19 pandemic and the fourth supplementary budget. He also failed to uphold his convictions on tax issues such as property tax reductions and the major shareholder capital gains tax criteria. Hong seemed to express his feelings of "I can no longer remain silent" after repeatedly being pressured and overridden by the ruling party in major policy decisions.

In political circles, opinions are divided between seeing his actions as "principled" and as a "political move." Democratic Party lawmaker Ki Dong-min criticized, "To put it bluntly, this could be misinterpreted as a political act and discourse by a seasoned politician rather than the role of a presidential aide," adding, "The form was inappropriate." In response, Hong said, "The word 'politics' cannot be applied to me," and added, "There was a debate, and the status quo was maintained, but someone had to take responsibility, and I thought it should be me. I was in a situation I could not endure."

The opposition party praised Hong’s principles but criticized the timing and method as inappropriate. People Power Party lawmaker Choo Kyung-ho pointed out, "This is behavior unbefitting of a Deputy Prime Minister." Choo said, "Even if the Deputy Prime Minister expresses a differing opinion and intends to resign, shouldn’t it be done after the regular National Assembly session and in a public manner? Whether it is the standing committee or the Budget and Accounts Special Committee, if someone is about to leave, can serious questioning be conducted against that person?" he raised his voice.

◆Creating an Atmosphere for Principled Administration= Experts advise that an environment should be created where skilled bureaucrats can exercise their principles. Professor Kim Woo-chul of the Department of Taxation at the University of Seoul explained, "Tax policy often involves sharp conflicts among stakeholders," and "Professional knowledge and a neutral stance are necessary." He advised that a government with strong continuity should formulate economic policies. Professor Kim said, "Party members may change, but even if the Deputy Prime Minister changes, the organization remains, so there is continuity and accountability."

Professor Sung Tae-yoon of Yonsei University’s Department of Economics stated, "If economic policies change according to political interests, side effects may occur in the market," and emphasized, "Policies should reflect the opinions of professional bureaucrats to ensure they are effective."

The Blue House immediately rejected Hong’s resignation letter. However, Hong reiterated his intention to resign at the National Assembly, making his actual departure uncertain. Blue House spokesperson Kang Min-seok announced right after Hong’s resignation statement, "Deputy Prime Minister Hong expressed his intention to resign to the President immediately after today’s Cabinet meeting, but the President promptly rejected it and reaffirmed his trust." Nevertheless, Hong confirmed his resignation intention during his National Assembly response, saying, "I did not hear about the President’s rejection as I was coming to the National Assembly. I will continue to fulfill my duties until a successor is appointed."

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