South Korea sends mixed message with war games, unification tax

South Korea President Lee on Sunday emphasized coexistence and proposed a unification tax to prepare for any future collapse of North Korea. Monday, he expressed strong support for this week's war games with the United States.

By , Correspondent

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    The USS Blue Ridge rides at anchor in a naval port in Busan, South Korea, Aug. 16, waiting for Ulchi Freedom Guardian, a joint military exercise between South Korea and the United States. Tens of thousands of South Korean and US troops launched a fresh round of military drills Monday despite North Korea's warning that it would retaliate with a "merciless counterblow" for the exercises Pyongyang considers a rehearsal for invasion.
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South Korea’s President Lee Myung-bak faces a storm of criticism if he tries to push through a hefty “unification tax” to help cover the immense costs of reunifying North and South Korea in the event of the collapse of North Korea.

 “It’s a crazy idea,” says Chang Sung-eun, who works as a personal trainer in central Seoul. “He is a very rich man. He doesn’t care. I don’t have money.”

Then again, Koreans wonder how serious Mr. Lee is about the plan, presented Sunday on the 65th  anniversary of the end of Japanese colonial rule. Standing in front of the massive newly reconstructed gate of a one-time royal palace that was destroyed by the Japanese, Lee said that “inter-Korean relations demand a new paradigm,” in which “the two sides choose coexistence instead of confrontation; progress instead of stagnation.”

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But less than 24 hours later, on Monday, he called for “training thoroughly” in joint exercises this week involving 55,000 South Korean and 30,000 American troops.

The remarks reflect the dual outlook of a society that is prospering as never before but anxious about rising tensions in the wake of the sinking of a South Korean warship in March.

“On the hand, we need to talk about unification,” says Choi Jin-wook, a senior analyst at the Korea Institute of National Unification. “And we need also to talk about deterrence.”

Greater significance of these war games

The war games, called Ulchi Freedom Guardian, an annual affair, assume greater significance this year “when inter-Korean tensions have heightened,” said an official on Lee’s staff. Gen. Walter Sharp, commander of the 28,500 US troops in South Korea, called these games, conducted in large part in computerized displays of combat, “the largest joint theater exercises in the world.”

The games are sure to be all the more upsetting to North Korea since they're beginning soon after two sets of air and naval exercises. South Korean ships and planes finished five days of exercises a week ago in the Yellow Sea, and late last month, US and South Korean ships and planes conducted still larger exercises on the opposite side of the Korean Peninsula, off Korea's east coast.

North Korea has so far been silent on Lee’s unification plan but promised to respond with a “merciless counterblow” to the exercises.” It was the kind of rhetorical blast that has become routine since a multinational investigation held the North responsible for the sinking of the Cheonan, but nonetheless is definitely raising anxiety levels.

Popular skepticism

Most people here do not think Lee’s unification plan will really improve matters.

“In these days, when there is a tension, I think such an offer would only instigate the North Koreans,” says Kim Sang-hyeop a graduate student. And he is skeptical of any proposal for levying special taxes to defray the costs of unification.

“I oppose an additional tax to help North Korea at this point,” he says, suggesting instead that the government dip into other resources. “I heard there is an unused inter-Korean cooperation fund,” he says. It’s “designed to help North Korea’s economy.”

Lee said he would ask experts to work out how to levy the funds “to carry out comprehensive inter-Korean exchanges and cooperation” for “developing the North’s economy dramatically” and creating “an economic community in which the two will work for economic integration.”

One study figures the cost at more than $1 trillion, which is less than half that of reunifying former East and West Germany. Others have said the cost will be much higher, considering North Korea’s ongoing hostility and the record of the Korean War. Koreans are observing the 60th  anniversary of bloody firefights as US and South Korean forces staved off the North Korean invasion of June 25, 1950.

Reunification not right around the corner

With North Korea denouncing Lee’s policies at every juncture, though, the prospects for reunification in the near future appear dim. China calls for “stability” on the Korean Peninsula while firmly supporting North Korea, its Korean War ally, both economically and militarily.

“North Korea will surely not like it,” says Kim Bum-soo, editor of a conservative journal here, suggesting the North will view any notion of the South intruding in its affairs as anathema. ”That will be an obstruction.” Moreover, he adds, “not many people here will like that.”

That’s an understatement as far as office worker Oh Sung-guk is concerned. “It’s just another gimmick. He can say anything. I don’t know how sincere he is.”

One question, Mr. Oh asks, is what will really happen to the money. “Who knows what they’ll do with it,” he says.

Not everyone, though, is totally against the idea. “If they impose new taxes, we will have to pay,” says Albert Kim, a retired United Nations bureaucrat. “But they cannot ask anything irrational.”

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