As the result of adopting communism in other countries, too,
their national economy was devastated and national resources
were exhausted on a large scale until they had to decide to re-adopt
capitalism belatedly, but only afer the countries that stuck to capitalism
joined the ranks of advanced countries.
As can be seen in the above, when any theory whose effectiveness
has not yet proven in reality is applied iindiscriminately based on just belief in it,
it produces miserable results.
Moreover, income redistribution policy has never turned around
any national economy, not even once..
Rather, it degraded many countries over the world to the state of poverty.
Argentine, once one of 10 strongest economic powers in the world
had adopted income redistribution policy before it became one of the poorest countries
in South America; and Venezuela, once the leader of South America is now witnessing
its own people in a mass exodus to neighbor countries as economic refuges.
Countries like Greece, Spain, Ireland, France and U.K. etc. that adopted
income-redistribution policy for 30 years has returned to busisness-friendly
and taxcut policy after experiencing economic disaster.
And yet, in Korea, they are performing a test of economy on 50 million population
based on the groundless belief that the so-called income-led growth--whose
effectiveness has never been proven nor has ever been introduced as an economic
tool in the textbook of economy---will revive the national economy.
Without paying any attention to the result of the test, people who are running our
national economy are the ones who enjoy the pleasure of seeing their own theory
being applied to real economy, performing the test that is way remote from human
innate nature in the blind belief that they alone can make it successful in Korea
even if it failed in all other countries, thinking that it will suffice for them to learn
a lesson from the real economy if the test failed, disregarding the fact that failure
means economic disaser for the whole nation..
On the other hand, other countries led by U.S,A and Japan are now enoying
enormous economic prosperity by adopting taxcut and business-friendly policy
based on the already-proven theory owing to the world economy rebounding
like a spring as a reflex of the long economic recession, clamouring for more
hands while in Korea we are clamouring for job opportunity.
More than 5,000 Korean youths failing to get a job in Korea study Japanese
and get a job in Japan every year.
Why does such a phenomenon happen?
First of all, income redistribution policy distorts the flow of economy.
Government must collect much tax for the sake of income redistribution;
and when businesses pay much tax, they reduce not only investment
but spending too for their expected profit reduces due to high tax.
Under capitalism, it is mostly either the rich or businesses that spend money;
so, if both reduce their spending or close their purse to pay tax, the nationall
consumption drops.
The policy authorities who adopted the flimsy economic theory of income-led
growth maintain that the people who receive money from the governmen will
spend money but the poor who receive money from the governmen have
a very strong tendency of saving the money instead of spending for they fear
poverty. Such phenomenon was proven to be true by the failed policy of Japan
during iits 20 years' economic recession.
The rich tend to spend more than the poor, whcih fact is overlooked
by the government. It must stop to think of the reason why the advanced
countries welcome the rich with open arms even granting citizenship to them.
Moreover, the poor do not actively participate in labor market for the government
pays them money; even when they choose to work for money, they get around
seeking a higher pay; such a behavior increases the wages businesses pay
as a whole, ending up increasing the cost factor of goods and services
business offers and degrades its competitiveness.
The fiscal multiplier of our country hovers around 0.6, which means that if the government
collects tax of 10 and re-distributes it, 4 disappears in the process and onyl 6 contributes
to the national economy.
If the government increases the number of civil servants, the fiscal multiplier decreases.
The more income redistribution policy is strengthened in a country like Korea, the more
resources will be wasted and economy will be distorted and the whole nation will be
aboard an express train heading for poverty.
The above mentioned facts are nothing but a horse sense to anyone
who has experienced managing the smallest business but unfortunately
the current policy authorities who are now running our national economy
have no such experience at all, just enjoying the position of Qinshihuangdi
and Robespierre by one single election maintaining an unproven theory based
on which they can make a country where all people can live equally in opulence.
The operating principle of capitalism does not lie in income redistribution
but in profit. If theire is profit, business moves, if there is no profit,
it does not move. No mater how much money the government pours
money into economy, it gets depressed if business cannot expect any profit.
The reason why the Japanese Government cuts tax for business and re-operates
the nuclear plant despite the accident of having evacuated tens of thousands
of people is because it wants to reduce the electrical bills, thereby the cost of
business in Japan and increase the profit of business.
A bird on my hand is worth ten in the bush.
Economy depends on the demand and supply in the market
instead of the grandiose economic policy of government.
It is not one genius economist's unprecedented unique economic theory
that contributes to the livelihood of ordinary people who feel hungry and cold
but one single merchandise or one unit of services I sell at a profit today
that provides me and my family with food and comfortable bed tonight.