Pedestrians cross a road in Seoul, South Korea. SeongJoon Cho/Bloomberg New South Korean President Lee Jae Myung has chosen a finance minister who wants to run Asia’s fourth-largest economy like a business. Finance minister nominee Koo Yun-cheol vows to manage the national economy with a keen focus on returns on investment and making public spending more productive.
As Koo explains it, “South Korea must pursue real growth, and that requires a fundamental overhaul. We must run the economy like ‘Corporation Korea,’ where the people are our shareholders.” As I read these words, I can’t help but think of what Elon Musk tried, and failed at spectacularly, in the U.S., with his Department of Government Efficiency, or DOGE, ruse as part of the Donald Trump 2.0 presidency. To be sure, Koo seems like a sharp and worthy candidate to run the Ministry of Finance.
Before his current stint as an economics professor at Seoul National University, Koo was a seasoned Finance Ministry bureaucrat. And one hardly expects Koo to, if confirmed, show up at work, Musk-style, in black T-shirts, baseball caps and chainsaws gleefully firing workers and chopping government agencies. Yet Koo’s opening foray as Korea’s top economic official leaves much to be desired.
Clearly, this idea that a democratic nation should be run like a business has been proven wildly wrong at almost every turn. Trump’s first and now his second presidency is proof enough of the danger of corporatizing government. Didn’t Thailand try this with billionaire-turned-prime-minister Thaksin Shinawatra from 2001 to 2006?
Didn’t Italy also learn this lesson the hard way with Silvio Berlusconi? What about Korea in 2008, when voters turned to Lee Myung-bak, former CEO of Hyundai Group’s engineering and construction units, to make the economy more dynamic? A decade ago, Australians turned to Malcolm Turnbull, a Goldman Sachs bigwig-turned-national leader.
After 244 days in office, the Australian newspaper ran a critique that spoke for millions of voters unhappy with his leadership, headlined: “Malcolm Turnbull is Australia’s Prime Minister, Not CEO.” Years before that, the U.S. got a glimpse at an MBA presidency during the George W. Bush years. The Bush administration was loaded with former chieftains, including Dick Cheney and Donald Rumsfeld. Between the disastrous Iraq invasion and the subprime crisis, it’s an era all too many Americans try to forget.
Enter President Lee Jae Myung’s new government in Seoul. Team Lee is known to favor more expansionary fiscal policy. And to the table, Koo claims to bring a strong focus on artificial intelligence.
In April, he was quoted as saying that “Korea’s golden time lies in the next five years — our future depends on AI.” Yet it also depends on Koo pretty quickly realizing that Korea doesn’t need to be run like a company. It needs to rein in the corporate giants that run the place. It’s the dominance of a handful of corporate giants that shackles the stock market with the dreaded “Korea discount.” Lee, to his credit, has indeed talked about reining in the family-owned conglomerates, or chaebols, that long towered over the nation.
His talk of championing small-and-medium-size companies and shareholders has alarm bells ringing in the corporate suites of Samsung, Hyundai, LG, SK, Lotte and other Goliaths. Korea, after all, isn’t called “Samsung Nation” for nothing. Yet pretty much every Korean president of the last 25 years took off pledging chaebol reform.
But each, to varying degrees, realized the magnitude of the task and opted to work with the chaebol to hasten economic growth — or just tolerate the status quo. Will Lee be a different kind of Korea Inc. leader? Let’s hope so.
But his chosen finance minister misdiagnosing the challenge so early isn’t promising, as these things go.
