A Backward National Assembly Forcing Through the Grain Management Act

The revision to the Grain Management Act, which would require the government to purchase excess rice production, was sent directly from a standing committee of the National Assembly to the plenary session.

The National Assembly’s Agriculture, Food, Rural Affairs, Oceans and Fisheries Committee displayed recklessness by sending the revision directly to the plenary session without going through the Legislation and Judiciary Committee. The bill would compel the government to purchase rice whenever excess production reaches 3% or more of demand, or when rice prices fall by 5% or more from the previous year.

The National Assembly likely acted so recklessly because the revision is so poorly drafted and filled with little more than political claims that it would have been difficult to pass the Legislation and Judiciary Committee. It is regrettable that such high-handed legislative activity by members of the National Assembly lowers the standing of the Assembly itself.

The 21st National Assembly has so far pursued anti-market politics. It has repeatedly increased regulations that paralyze market functions and destroy jobs. Now it is even undermining democratic procedures, making arguments that the National Assembly is useless increasingly unavoidable.

The idea that the government should buy up surplus rice can hardly be regarded as sound thinking in a democratic country that respects market order. In a democratic country that has succeeded in industrialization, turning such anti-market claims into law amounts to a declaration that Korea should be made into a “backward country.”

It is simply hard to believe that the Republic of Korea, a major trading nation that grew and developed through trade with the world, could be reduced to a backward country because of a National Assembly now pushing to adopt such socialist policies.

The National Assembly’s revision is nothing more than taking rice producers hostage for political purposes and disabling market functions. It may contribute to transforming the economic system in a socialist direction, but it will clearly bring about the collapse of our agricultural economy and weaken the economy as a whole.

Our agriculture has continued rice production without proper market functioning, and as a result has fallen into a long-term debt trap caused by low returns. This is evidence that past policies have failed and that fundamental reform is urgently needed.

But the National Assembly has pushed ahead with revisions to the Grain Management Act that further reinforce this mistaken policy direction. This only strengthens a failed policy and harms everyone. A system that creates and entrenches a structure of rice overproduction can never increase the welfare of either rice producers or consumers. Policies that depart from market order will only make the incomes of rice-growing households even more unstable.

Excess rice supply has long increased burdens on both farmers and the government. The National Assembly should be finding ways to resolve this, yet it has instead moved to enact a law that encourages overproduction. This reveals both ignorance of the market economy and an overt determination to pursue socialist policies.

Now is the time to shift the structure of rice production toward a “value-creating” model and move in a direction that raises farm household income. The system should be improved so that rice production can adjust stably in line with demand.

Sung-no Choi, President of the Center for Free Enterprise (CFE)

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Original title: 양곡법 밀어붙이는 후진 국회

Author: Sung-no Choi

Date: 2023-01-06

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&idx=25272