In other words: “Its the economy stupid!” It did mention S.Korea being squeezed economically between high end Japan and low end China, something I blogged about before. It will be very interesting to see how Lee interacts with his neighbors, as in the past he has favored a harder line on North Korea and demonstrated some anti-Japanese animus.

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Only suspense in Korean election is margin of victory for front-runner

Sunday, December 16, 2007

SEOUL: South Korea’s presidential elections have tended to be bruising, down-to-the-wire contests that exposed voters’ ideological schisms and raw emotions over the country’s tortured relations with North Korea and the United States.

But this time, in a campaign that has otherwise failed to grab the electorate’s attention, there has really been only one issue: the economy. And the only suspense had been whether the clear front-runner would sail smoothly to victory or have his campaign derailed by charges of stock manipulation. He was cleared early this month.

As candidates crisscrossed the country in the final days before the vote, on Dec. 19, the front-runner, Lee Myung Bak, a former mayor of Seoul and a construction industry executive nicknamed the “Bulldozer” for his take-charge style, was almost certain to be elected South Korea’s next president.

With Lee enjoying a lead of nearly 30 percentage points in opinion polls over his nearest rival, his aides were talking confidently of capturing more than 50 percent of the popular vote, something no one has accomplished since South Korea’s democratization in the late 1980s.

“We are predicting between 50 percent and 55 percent,” Chung Doo Un, a top aide to Lee and a national assembly member, said Sunday. “I think this will be unprecedented in the history of South Korea.”

Lee, 65, would succeed President Roh Moo Hyun, who is limited by the Constitution to a single five-year term. Five years ago, Roh, a little known human rights lawyer, came out of nowhere with a message of asserting independence from the United States, reconciling with North Korea and stressing social equality, but saw his ratings plummet because of growing popular discontent over his economic policies.

In his campaign appearances, Lee, the candidate for the conservative Grand National Party, capitalized on this anger, as he attacked the Roh administration and presented himself as best qualified to handle the economy.

“I will create a world where young people can choose good jobs,” Lee said to a raucous crowd at a market in the southeastern city of Taegu last week. “To people selling things, those running small- and medium-sized companies, I will create a world that works. I will unfailingly revive the economy of the Republic of Korea.”

Lee’s platform for reviving the economy ranges from the orthodox, like lowering corporate taxes, to the grandiose, like building a huge canal to connect two rivers and form a unified shipping route from the southwest to the northeast. He has also pledged to realize his “Korea 747 Vision” – increasing economic growth to 7 percent a year, doubling per capita income to $40,000 within a decade and turning South Korea, now the world’s 13th biggest economy, into the seventh largest.

The message has resonated in a country increasingly squeezed between high-tech Japan and low-cost China. While multinationals like Samsung are doing well, small and medium-sized businesses find it increasingly difficult to compete against counterparts outside the country because of rising labor costs. While the stock market is booming, economic growth has slowed. Soaring real estate prices have made housing unaffordable for average Koreans, and youth unemployment remains high.

Although many of the country’s economic difficulties lie beyond the control of any president, voters blame Roh for the malaise, especially after his attempts to rein in real estate speculation backfired and pushed prices higher.

Roh ended up losing even his most ardent supporters – young voters who, in 2002, were attracted to his image as a reformer and rallied for him on the Internet and on the streets.

“I was very excited in 2002, but feel that he didn’t accomplish much in the economy,” said Lee Jong Youl, 32, an office worker browsing in a bookstore in central Seoul. “For someone in the middle class or lower, like me, I feel that income gaps have widened.”

Lee said he had barely followed this election and was undecided whom to support on Wednesday, but he added that the front-runner was “not bad.”

Yoon Yae Young, 31, a graduate student, was not supporting Lee but explained why others were.

“The young believe that he’ll revive the economy and create jobs,” Yoon said. “They blame Roh Moo Hyun for everything. There’s a joke that even when something bad happened in your personal life, you blamed Roh Moo Hyun.”

So unpopular was Roh that members of his Uri Party created a new party, the United New Democratic Party, in an effort to disassociate themselves from him. Still, the new party’s candidate, Chung Dong Young, 54, ranks a distant second in opinion polls.

Lee’s focus on bread-and-butter issues stands in sharp contrast to Roh and his predecessor, Kim Dae Jung, both of whom had clear objectives of democratizing the South Korean society and reconciling with North Korea.

Lee supports engaging the North and promises massive economic assistance if Pyongyang abandons its nuclear arms. But he does not make emotional appeals to Korean unity, as Roh did, and takes a harder rhetorical line by insisting that he will not shy away from using sticks against the North.

Lee Myung Bak is perceived as being much more of a pragmatist than an ideologue,” said Lee Nae Young, a political scientist at Korea University who has been conducting opinion polls on the election.

“He appeals to the general public because his views are perceived as being closest to the general public’s views.”

Since the last presidential election, Lee said, Korean public opinion has shifted to the center while the left and right have shrunk. Policy toward North Korea has not come to the fore as an issue in this election because differences between conservatives and liberals have narrowed considerably since 2002, he added, and a general consensus over the engagement policy has emerged.

Indeed, Lee’s Grand National Party itself has moved toward the center. In the 2002 and 1997 elections, it selected as its standard-bearer Lee Hoi Chang, a right-wing hard-liner against North Korea.

Last month, Lee Hoi Chang, 72, unexpectedly declared his candidacy, this time as an independent, saying he was displeased with the front-runner’s policy toward the North.

“Lee Myung Bak’s policy toward North Korea is a copycat of the sunshine policy,” Lee Hae Yon, a spokeswoman for Lee Hoi Chang, said of the engagement policy toward the North. “Our candidate believes that the main goals should be to denuclearize North Korea and for its regime to change.”

Lee Hoi Chang trails in third place. But analysts say he could eke out a few points on Wednesday and rob the front-runner of his goal of winning more than 50 percent of the popular vote.

Roh orders new Lee inquiry

Roh, the president of South Korea, ordered justice officials Sunday to reopen an investigation into financial fraud allegations against the front-runner in the presidential race just days before the vote, The Associated Press reported from Seoul.

Roh requested that the justice minister consider reopening the case against Lee Myung Bak to “relieve the public suspicion and regain the prosecution’s trust,” an official said on condition of anonymity. Earlier this month, prosecutors said Lee had been cleared of wrongdoing in a stock price manipulation case surrounding a former business associate.

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