Yoon Administration Takes First Step Toward Deregulation and Greater Freedom

Since President Yoon Suk Yeol took office, meaningful changes have been taking place in our society. Although the period has been too short to produce major breakthroughs, his administration has been normalizing misguided policies of the past and restoring rationality and realism. He won the presidential election by a narrow margin of 0.73 percentage points, and despite facing a divided government in which the ruling party holds fewer seats than the opposition, he has shown stable governance.

The fact that he emphasized the value of freedom so strongly in his inaugural address—mentioning it 35 times—raises expectations for the future of our country and the Yoon administration. A five-year term is long enough to change many things. If the people are granted greater freedom, the economy will develop accordingly, and the public’s welfare and prosperity will expand.

Expanding freedom is both important and urgent. First, the regulations imposed by the previous administration that suppressed private freedom must be dismantled. Loosening regulations that have deprived citizens, consumers, and businesses of their right to choose, and under which the government has made decisions in their place, would in effect return freedom to the people. The government must also reduce the behavior of big government, which has threatened and taken away the people’s property rights by imposing taxes like fines and recklessly expanding the money supply. Only then can people’s lives be stabilized and the soundness of the economy be improved.

To build a successful future, we must learn from the failures of past administrations. The Lee Myung-bak administration failed to manage political risk and lost momentum for reform amid the candlelight protests, but it succeeded in extending its hold on power by protecting the national economy during the global financial crisis. By contrast, the Park Geun-hye and Moon Jae-in administrations set the direction of state affairs incorrectly toward economic democratization and anti-capitalism, failed to produce results, and ultimately failed to retain power. Because the Yoon Suk Yeol administration has a weaker political base than previous governments, it must manage political risk even more thoroughly. It must respond swiftly to the economic crisis and faithfully govern according to pro-market solutions.

The Yoon Suk Yeol administration has taken the first step on the long journey toward expanding freedom. If it normalizes state affairs steadily, one step at a time, the world will become brighter. For now, however, it faces the immediate challenge of responding to a complex economic crisis brought on by global inflation, surging oil prices, and the economic slowdown caused by the aftereffects of COVID-19. The foundation of overcoming a crisis is to make the economy more flexible. Increasing government spending alone cannot overcome an economic crisis. Productivity must rise and competitiveness must be secured so that both jobs and incomes can grow. Alongside overcoming the crisis, what is needed is innovative leadership that transforms the economic structure into that of an advanced economy—one in which the private sector can invest freely and economic vitality can increase.

Along with short-term responses to overcome the crisis, an important long-term task is to institutionalize market-friendly policies in order to advance our economy. Anti-market policies accumulated in such areas as business, labor, and the environment under previous administrations, leaving the economy in a weakened state. Market-friendly legislation and regulatory reform are needed to restore a vibrant and flexible economic system.

This is an era in which job creation is precious. Young people need opportunities to work. But the government should not create jobs by spending tax revenue. That is merely a meaningless waste of taxes. If young people are to experience the joy of earning income through creating value and contributing to society, private-sector-led investment must come first. To this end, bold government-led deregulation is required.

Policies grounded in economic principles may be politically unpopular in the short term, but because they can produce economic results, they can earn high marks in the long run. We need to remember that all policies that governed state affairs through populist approaches in the past ultimately failed. For President Yoon Suk Yeol to become a successful leader, he must be able to advance in reality the freedom he emphasized at the time of his inauguration. If he moves in the right direction—toward liberalism and the market economy—the future of our country and of President Yoon Suk Yeol will be bright.

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

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Original title: 尹정부, 규제해소·자유확대 첫걸음 뗐다

Author: Sung-no Choi

Date: 2022-08-04

Source: https://www.cfe.org/bbs/bbsDetail.php?cid=press&idx=24880