ANTI-CORRUPTION MEASURES OF THE ‘GOVERNMENT OF THE PEOPLE’

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ANTI-CORRUPTION MEASURES OF THE ‘GOVERNMENT OF THE PEOPLE’

Jin Soon Lee
President, KDI

SUMMARY

The clandestine nature of corruption makes it impossible to estimate its full magnitude and impacts, but the detrimental effects it has on the economy and society are evident. Corruption distorts the allocation of resources, undermines fair competition in the marketplace, hinders economic development, erodes confidence in political systems, and fosters organized crime.

The current economic crisis in Korea is partly attributed to the rampant corruption which was prevalent during the period of government-led rapid economic growth. Growth-oriented policies involved the government's authoritarian intervention in the economy in the forms of regulations and administrative guidance which replaced market mechanism rather than making up for market failure. Such intervention produced various distortions which, in turn, necessitates another intervention to resolve its dysfunction. In the last 30 years, the Korean economy had been entrapped in a self-propagating intervention spiral.


Paradoxically, 'anti-corruption' has been one of the recurring themes in administrative reform drives of all previous Korean governments in the beginning of their political regimes, but without much success. The reason behind the ineffectiveness of all the previous anti-corruption measures may lie in the fact that first, they have not been well institutionalized to focus on removing the more fundamental causes of corruption such as economic rents, and second, the anti-corruption campaigns of governments were often motivated by political considerations and partisan interests.

The Kim Dae-jung administration opens a new era of integrated and comprehensive anti-corruption policy. The new policy is comprised of five pillars -- deregulation, increasing accessibility to official information, the Anti-corruption Act, investigation, and campaigns and education against corruption.

In Korea, corruption tends to be recognized as 'modus operandi' itself. Not only public officials but also ordinary citizens perceive that they may not successfully be able to compete with others without corruption. Corruption is being practiced by diversified strata of public officials, politicians, and ordinary citizens.

Korea's recent experiences indicate that top-down policy measures without drastic changes in culture, consciousness, and practice do not serve their purpose. The current government plans to embark on a nation-wide campaign to build up new ethical norms in public service and enhance public awareness on corruption to solicit public support for its anti-corruption efforts.

At the heart of the current Korean crisis lies the failure to achieve a balanced development of democracy and a market economy over the past thirty years of modernization. Had these institutions been allowed to develop spontaneously in Korea, many of the current shortcomings, such as collusive ties between government and business, the government-controlled financial system, and corruption and moral hazard that caused tremendous losses to the national economy could have been prevented.

Therefore, in order to weather the current crisis and enhance long-term growth potential, we need to promote freedom, competition, and accountability. For this purpose, it is essential to improve the transparency of the investment environment, restore confidence in the fairness of public sector regulations and procedures, and create equal and fair competition for all through eliminating rampant corruption. In the drive to implement anti-corruption reform, it is important to recognize that it is a long-term process which must be openly supported from top to bottom, and one in which attitudes and conduct must be remolded and reinforced at all levels.