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Eureka: 5 economic disasters South Korea should fix Eureka: 5 economic disasters South Korea should fix
by Akli Hadid
2018-09-08 09:06:24
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5 economic disasters South Korea should quickly fix.

  1. Income-led growth

In the economy, be it the American economy, the Israeli economy, the Swaziland economy or the Solomon Island's economy, politicians should never focus on income, or income-led growth. You focus on industry-led growth, on business profit led growth, and income naturally follows suit. If Samsung makes a lot of money, it hires more people and gives its employees wage hikes. If SMEs make more profits, they hire more people and pay them better wages. If I start a business I want my profits to shoot up. Then I can hire people and pay them decent wages. You don't force Samsung or C&U or Kimbap Cheonguk to pay their employees more wages. You lay the groundwork so they can make more money. You lower taxes, use anti-trust laws effectively, ban corruption and punish mafia-like behavior among big businesses who force small businesses to buy everything in bulk or threaten to stop supplying them.

  1. koreconom01_400The 10 million dollar export club

This club was started by the Park Chung Hee administration and the idea was to reward businesses who made a lot of exports with awards and networking opportunities. While people were naive in the 1970s and 1980s, here's what a lot of businesses do:

They start a business, don't produce anything. They send people to borrow and send money (often borrow from the mafia) to their HQ bank account. 1 million dollars from Italy, a million from Ukraine, a million from Greece, a million from Portugal, you soon reach the 10 million dollar export mark.

You are then invited by the Blue House for networking gatherings and try to sell your business to a bigger business who will be duped into thinking that you export 10 million a year. Far too many people have used this tactic.

  1. The welfare state

While it's a good idea to set up retirement pensions, healthcare, unemployment pensions, large family pensions and disability pensions, the main problem is Park Geun Hye tried to put money in the welfare budget by freezing hiring in public service and even firing public servants.

Now in countries like the US or Canada you can find a job regardless of your age and background. In South Korea, once a public servant, always a public servant. If you graduate university, you are no longer eligible for big business jobs, and if you are over 30 your job options are very limited. So firing people to put them on welfare was not a great idea.

  1. Job-led growth

How do you create jobs? Here's the recipe:

-You promote strict anti-discrimination laws so companies are not allowed to only hire those enrolled in university, those who are under 30, only men or only women. Basically you allow people to move from Samsung to LG to Hyundai to whatever job they please.

-You promote task-oriented careers over rank-oriented careers. Ranks are for the army. At companies, people perform tasks.

-You allow workers to negotiate their pay and working conditions. A job is a win-win affair.

-You set up a labor arbitration court and ban the following: emotional abuse, physical abuse, monitoring of workers. When a boss does not like someone, the boss usually monitors the employee he hates so closely that poor employee ends up making a lot of mistakes and ends up resigning or being fired from their job. If a boss doesn't like his employee, he should first get the employee to change departments if necessary. Because if the employee is fired, he has to look for a new job.

-You allow free enterprise but ban the following: corruption, business cartels and business harassment and blackmail. That way small businesses don't have to worry about being swallowed by big businesses.

-Finally, you listen to worker's complaints and do something about them. If workers are complaining about their work conditions, wages or other work-related complaints, fix it.

-Finally, finally, you promote privacy laws. Workers should be allowed to keep their phone numbers private, personal information including health information private, and their whereabouts after working hours private.

-Finally, finally, finally, working is not keeping our employees busy with useless work while the higher-ranked staff engages in illegal or semi-legal activities. It's not about giving employees useless tasks and trying to see if they are trustworthy or not, that is if they can be trusted to keep their mouths shut about the company's mafia-like activities. This creates a nation of outlaws.

5- Education is about efficiency

30% of the South Korean GDP goes to education. Here's how the education system works.

-Hire the worst possible teacher so students will need tutoring. Fire the better or best teachers and make sure they never teach.

-Private after-school programs hire the worst possible teachers to tutor students. Fire teachers if they are good at teaching. So that parents will think there's a problem with their child and binge on tutoring, meaning more income for after-school programs.

-For adults. Hire the worst possible teacher, but one with a pleasant face and/or physique. That way students will think there is nothing wrong with their teacher (usually English teacher) and will think they are naturally bad at learning languages. Fire the good language teachers.

-Hammer students into submission. Destroy their egos. That way they will never complain about the quality of teachers.

Conclusion and recommendations

      1) Growth is profit-led growth.

2)      Never substitute profit for welfare. Never. Profits first. Profits second. Profits third. Then maybe something about welfare.

3)      If profits are acquired in dishonest ways, you can't fool too many people too many times. While some dishonesty is inevitable in the economy, there should be something like 70 or 80% honesty in the economy.

Good luck, and to a prosperous decade!


      
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