[Editorial]Meager Accomplishment of No-Principle Policies

It is a refreshing experience that the state owned Korean Institute for Industrial Economics and Trades (KIET) criticized the government policy, describing ``the restructuring for the past three years could have little effect due to the policy implementation without a reasonable base. Even though the report was conditioned ``to indicate the problems of the policies,`` KIET evaluated the core policies of the government to overcome the foreign exchange crisis as failed. The economic policy makers must pay attention to the report.

The KIET report is especially significant in that the state owned institute KIET accepted the problems of the economic policies that had been repeatedly indicated by the non-institutional scholars. For example, the Big-deal, propagandized by the government as the greatest accomplishment, was driven unilaterally by the government ignoring the criticisms of the business sectors. The report pointed out that the big-deal was a typical case without a reasonable ground. The responsibility of the failed policies must be questioned.

Regarding the unilateral application of the 200 percent debt ratio, KIET criticized that there is no theoretical ground to persuade the business sectors and the policy has no precedent even in the foreign economic policies. In spite of the repeated appeals of the business sectors, the government has suppressed them, saying ``do not protest against the reformation.`` Now, the Ministry of Finance and Economy, the Financial Supervisory Service, and the Korea Fair Trade Commission should respond to this indication.

Particularly, the noteworthy part of this report is that the restructuring ignored the particular financial and operation situations and applied a fixed regulation unilaterally to all the business. That indication coincides with the criticism of the press and the public opinions that the policy ignores the principles of the market economy.

In addition, KIET revealed that, by the aggressive intervention of the government into the restructuring process, the settlement of the market system had been delayed. The indication, ``that the government exercised the crucial influences on the selection of the work-out companies and its implementation by the proxies of the creditor banks,`` would be a good standard for the judgment of the legal disputes in the future.

The KIET report mostly accepted the problems of the current economic policies that had been indicated by the press and the non-institutional scholars. Now, the urgent task of the government is to accept humbly the indications and straighten up the distorted policies. That is the way to minimize the harmful effects of the government`s missteps.