by Hugo Polanco
By most accounts South Korea is an extremely prosperous nations, especially when compared to the mind boggling destitution of its northern neighbor. Ever since the two split, the South has rapidly climbed to economic greatness and now its products both commercial and cultural are widely exported. If you’ve ever owed an LG telephone, Hyundai car or watched a Korean drama then you are one of the many consumers of these products. These goods that are surging out of South Korea are the products of South Korea’s chaebol. The chaebol are South Korea’s vast business empires, held as personal fiefs by a small number of South Korean families.
The control that these groups have exerted over South Korea is incredible and disturbing. Samsung the largest chaebol for example has business interests in the electronics, constriction , theme parks, life insurance, and ship building industries. Unlike other large conglomerates the South Korean chaebol are also known for outright owning most of their suppliers giving them more monopolistic power over the South Korean economy.
Beyond economic power, the chaebol have also had a complex relation with the South Korean government dating back to the end of the Second World War. During this time period the founding families, with the seized Japanese industries and political support quickly grew. Later they exploded under the patronage of President Park Chung-hee. The chaebol were given preferential treatment as a strategy to industrialize the country. In a way it worked, this time period saw South Korea rise as one of the four Asian Tigers as well as finally surpassing North Korea’s industrial advantage.
Now as South Korea is prosperous and spreading their influence throughout the world, there is great domestic concern over the damaging control the chaebol. These opinions have a shifted widely in the past, the chaebol were exalted for the rise of the South Korean miracle economy, denounced during the Asian financial crisis and finally rehabilitated during the recent global economic downturn.
The recent elections have sent signs that the chaebol’s reputation is again falling. Many South Koreans believe that chaebol and government are intertwined to a ludicrous extant. The stock of chaebol rise and fall depending on the electoral fortunes of the parties they patronize. For example one investor sold his stock of a pharmaceutical company based on that fact that an opposition party leader had once visited a company hospital nearly 20 years ago for back surgery. The chaebol are now seen to contribute little to society, they make billions in profits but employ only a tiny fraction of the South Korean population. The fact that so much profits are being made when there such deep holes in the South Korean social security net is also upsetting.
Before we haughtily deem our own society vastly superior, we should use South Korea as a mirror for the failings of own society. The United States also has a far from exemplar relationship with private business, we are notorious for one for the extant that corporations are able to use money in elections. Both the United States and South Korea would do well to look in ourselves and question whether we are satisfied with the status quo.