The South Korean government may well lean toward the left regardless of who wins the Dec. 19 presidential election, triggering concern among South Korean business leaders that they could be heading into another “black decade.”

The conservative incumbent president, Lee Myung Bak, came to power in 2008 after the nation’s economy had stagnated for 10 years under his two predecessors — Kim Dae Jung from 1998 to 2003 and Roh Moon Hyun from 2003 to 2008.

But his rate of approval has plummeted sharply of late due partly to scandals surrounding his top aides, casting doubts about the chances of Park Geun Hye, of the ruling New Frontier Party, succeeding him.

The opposition camp, meanwhile, has chosen Moon Jae In of the Democratic Unity Party as its unified candidate after his rival, Ahn Cheol Soo, an independent, agreed to step down.

A South Korean political journalist says that both Moon and Ahn share the basic policy lines of “lavish spending” and “democratization of the economy.” This in essence means regulating or dismantling conglomerates and rectifying economic disparities. A regime headed by Moon would lean more heavily toward the left than one under Ahn, the journalist says.

Moon served as chief secretary to President Roh. Their careers follow similar paths — civic activists who became lawyers. A quick look at the names of Moon’s top aides leaves no doubt that once elected, he would pursue a socialist-tinted agenda.

An opinion poll taken after Ahn’s withdrawal showed that Moon is fighting a close race with Park, who is the daughter of former president Park Chung Hye. Moon’s chance of winning will increase if he gains full support from Ahn.

“Moon is not assured of victory,” says a reporter with a national newspaper in Seoul. “Not a few Ahn supporters are conservative, but they still detest the existing political parties. They could end up abstaining or voting for Park.”

What really scares business circles, says a high-ranking executive of a major manufacturing company, is not just the possibility of Moon being elected but the prospect that the new government will lean to the left even if Park becomes president. That’s because Park, too, calls for rectifying the concentration of wealth in the conglomerates and spending more on welfare and education.

She has had no choice but to pursue such policies in order to dispel the image of being the daughter of the military dictator who collaborated with the Japanese military while Korea was under Japanese colonial rule. She has to pay attention to the sentiments of South Koreans who want to publicly expose those who collaborated. Thus a kind of upside-down scene is unfolding in which Park is heading toward populism despite being a “conservative” presidential candidate.

This tendency toward the left was noticeable even before the major political parties selected their presidential candidates. In the mayoral election in Seoul, the capital, a year ago, Park Won Soon — of the opposition camp who dared to favor providing assistance to North Korea — won an easy victory.

A reporter for a local economic newspaper says a rapid downturn in South Korea’s economy is feared the most, possibly as a result of a leftist-leaning new national government. The scattering of money among constituencies as well as strict regulation of the conglomerates could deal a devastating economic blow.

“While it is true that the concentration of capital in the hands of the conglomerates is the cause of the prevailing economic disparities,” he says, “the only strength of the Korean economy is its ability to earn foreign currencies through exports, helped by the low value of the won currency.

“For the South Korean manufacturing sector, which lacks innovative technologies, the distorted economic structure, which operates at the expense of ordinary citizens, is a necessary evil.”

Reform of the conglomerates was attempted during the days of President Kim, when South Korea was placed under the surveillance of the International Monetary Fund. But in the midst of economic stagnation, the conglomerates managed to maintain and even expand their power. People’s dissatisfaction had swelled by the time Roh came to power.

After Lee took over the government, those giant business groups at least proved themselves capable of overcoming the effects precipitated by the 2008 Lehman Brothers shock; they were able to catch up with and surpass Japanese manufacturers. So, it would be suicidal, a leading business leader says, to tie the hands of manufacturers belonging to the conglomerates with regulations, particularly at a time when the Chinese economy is slowing down.

The new left-leaning tendency in South Korea would have a serious impact not only on the country but also on the international balance in all of East Asia. South Korea’s relations with the North are in a deep freeze. Yet both presidential candidates — Park and Moon — call for reconciliation with the North.

Promoting dialogue with the North is one of the key points in Moon’s policies. Park also calls for promoting economic cooperation with the North and has expressed willingness to meet with North Korean leader Kim Jong Un.

The political journalist, however, pointed out that it was the “sunshine policy” initiated by President Kim that enabled North Korea to develop nuclear weapons. A South Korean diplomatic source echoes this view, saying that North Korea will only get naughtier and more arrogant if South Korea extends aids to it without first ascertaining the true posture of the nascent Kim Jong Un regime. The source adds that such a move by Seoul would displease the United States.

On the diplomatic front, seeds of conflict also exist with China. Territorial water disputes between South Korea and China will become more serious if the Chinese economy continues to slow down.

As for Seoul’s stance toward Tokyo, most experts do not see any change.

Although indications are that South Korea’s lean toward the left will not benefit the situation in East Asia, the result of the upcoming presidential election will have serious consequences.

This is an abridged translation of an article from the December issue of Sentaku, a monthly magazine covering Japanese political, social and economic scenes.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.