Despite the fact that lawmakers in Korea's National Assembly are still struggling to find funding for existing welfare programs a la free school meals and child-care programs, it seems that the New Politics Alliance for Democracy (NPAD) Party, the moribund main opposition party, has proposed yet another welfare program.
(One, does this mean that we can finally all agree that “free” is not really free? Two, I hope NPAD's advisers are unpaid interns. Even the most amateur gambler will tell you never to double down on a losing hand unless you are really good at bluffing, which the NPAD is not good at doing.)
Specifically, NPAD lawmaker Representative Hong Jong-hak stated that his party intends to push to provide up to 30,000 free homes for newlywed couples, as well as push to lower the National Housing Fund's interest rates.
Representative Hong said that the NPAD Party will push to allocate ₩243.2 billion (US$221.7 million) for the project in next year's budget.
Again, the National Assembly is still struggling to fund existing welfare programs.
In an article in the JoongAng Ilbo, the Ministry of Land, Infrastructure, and Transportation released a report to Saenuri lawmakers that stated that “assuming that the National Housing Fund's 2015 interest rates are held constant, constructing 30,000 homes over a period of four years will cost up to ₩3.6 trillion (US$3.2 billion). Furthermore, constructing 100,000 homes over a period of four years will cost up to ₩12.1 trillion (US$10.7 billion)”
Sense seemed to prevail when members of the ruling Saenuri Party opposed the NPAD Party's plans. They said that the plan was “unfeasible.”
However, lest anyone begins to think that the Saenuri Party is somehow the bastion of rational thought, I think this would be a good time to remind everyone that it is the same party that is still throwing its full weight behind Abenomics' even-uglier stepsister, Choinomics.
|You decide which is which|
At this point, I could go into an in-depth discussion about economic theories and present different kinds of arguments to state why this latest proposal is a harebrained idea.
I could talk in-depth about the Laffer Curve, which postulates that after a certain point of taxation, tax revenues actually fall rather than rise.
I could also talk, again, about Frédéric Bastiat's Broken Window Fallacy, which explains how opportunity costs affect economic activity in unforeseeable ways.
I could also talk about how economists/partisan economists/politicians can never predict economic conditions of the future (as even the OECD admits) because central bankers and political leaders who like to think of themselves as enlightened leaders tend to only see positive signs in the economy than spot potential problems because, like everyone else in the world, they like to think that they are doing a good job (see confirmation bias). This is why no one should ever trust a politician when a politician says “Trust me.”
Finally, I could talk about the pitfalls of populism. I could talk about how populism is, by its very nature, more focused on “redistribution” rather than thinking of ways to create new wealth. I could talk about how the problem with populists is that for all their flowery rhetoric, most of them have little to no idea about how to realize their lofty goals without having to “break a few eggs.” I could talk about how populism may be an attractive means to achieving short-term political victories, but that in the long-term, when its leadership finally has to own up to its own inadequacies, it will also have to contend with an enraged public that was promised Nirvana but delivered anything but.
I could talk about all that. But I won't. Going into an in-depth conversation about those topics requires sober thought, seriousness, and rational thought. However, politicians clearly have no such capability.
If this “homes for newlywed couples” is the best idea that NPAD lawmakers can come up with, I don't think that Saenuri lawmakers could possibly ask for a more loyal opposition as the Saenuri Party will be guaranteed to win one election after another, not because the Saenuri Party is wise or prudent, but only because it is a little less stupid than the NPAD Party.
Gods help us all.