Next Economic Society President: "Moon Administration's Policies Favoring 'My Side' Are Problematic"

Lee Jong-hwa Next President of the Korean Economic Association
Ideology and Justification Overshadow Achievements
Real Estate Policy as a Representative Failure

"Popular Policies Are Not Necessarily Good Policies
Policies Should Be Implemented with a Long-Term Perspective"
Emphasizes Investment in People as Well

Professor Lee Jong-hwa of Korea University, who has been appointed as the 52nd president of the Korean Economic Association, is being interviewed on the 9th at the Jeonggyeong Building of Korea University in Seongbuk-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporters Eunbyul Kim, Sehee Jang]"Korea has great potential in education and medical services, but the serious internal conflicts and the ideological drift in economic policies are problematic. Also, there are many cases where principles are prioritized over concrete results."

Professor Jonghwa Lee of Korea University’s Department of Economics, recently elected as the 52nd President of the Korean Economic Association in 2022, pointed out that the biggest issue with Korea’s economic policies is their entanglement in ideological and principled debates. Regarding cash-transfer welfare and real estate measures, he noted that many policies seemed to favor ‘my side’ rather than focusing on concrete effects. In a recent interview with Asia Economy at Korea University’s Political Science and Economics Building, Professor Lee said, "The Moon Jae-in administration’s economic policies are too laden with ideology and principles rather than tangible achievements," and added, "Regardless of which candidate wins the presidential election next year, I hope they will pursue economic policies with a long-term perspective rather than a ‘my side is right’ viewpoint."

Government Policies Are Dichotomous... Real Estate Policies Are a ‘Failure’

He criticized the government’s economic policies as being dichotomous, framed as ‘right or wrong.’ Professor Lee said, "Have you ever seen a foreign policy targeting only the poor? Economic policies should similarly be implemented with a long-term view that impacts many people." He added, "Distributing wealth without growth does not mean the next generation will live better."

The current administration’s real estate policy is a representative example. Professor Lee evaluated the current real estate policy as a ‘failure,’ diagnosing that "the government recklessly wielded the knife, changing the direction of the water flow and causing wounds everywhere, resulting in rising housing prices." Regarding the comprehensive real estate tax method targeting the top 2% being discussed mainly by the Democratic Party recently, he said, "I understand paying more tax on the premise that profits are realized at the time of sale," but added, "Demanding more tax simply because prices have risen is punitive taxation." He emphasized, "All taxes have long-term effects, so targeting a single class is inappropriate," and "It is necessary to consider not just the effects during the term but the long-term consequences."

Professor Lee Jong-hwa of Korea University, who has been appointed as the 52nd president of the Korean Economic Association, is being interviewed on the 9th at the Jeonggyeong Building of Korea University in Seongbuk-gu, Seoul. Photo by Kang Jin-hyung aymsdream@

Government Must Invest in People and Technology... "Should Also Consider Opening Doors to Foreign Labor"

Building a robust growth system while emerging from the COVID-19 crisis is also an important task. He said, "Korea’s industrial structure is largely organized around internationally competitive large corporations, which is disadvantageous for small and medium-sized enterprises (SMEs) and service companies." In such a system, government support is necessary for innovative SMEs to emerge, and as SMEs grow through support, labor can naturally flow toward innovative companies.

Regarding future government investment areas, he highlighted ‘investment in people’ and ‘technological innovation.’ Professor Lee said, "Even if someone wants to switch to the gaming industry, many do not know what skills to learn or whether they have the talent," emphasizing, "It is important for the government to invest in enhancing the abilities of its citizens." To increase labor market flexibility, people need to develop skills through job training and reduce fears about changing occupations. He said, "The labor market size cannot be forcibly increased by raising the birth rate," and added, "Since a quarter of the workforce will disappear over the next 20 years, opening the door to foreign labor is also necessary."

As the next president of the Korean Economic Association, Professor Lee emphasized that economists will play the role of ‘watchdogs and advisors’ for government policies. He said, "Next year is an important period with political events such as the presidential election," and added, "We will serve as advisors to ensure that many people benefit and that the national economy develops."

Professor Lee graduated from Korea University’s Department of Economics and earned his master’s and doctoral degrees in economics from Harvard University. He has served as an economist at the International Monetary Fund (IMF) and as the presidential advisor on international economic affairs during the Lee Myung-bak administration from 2011 to 2013.

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