Old habits die hard in South Korea. Since the early 1980s, numerous politicians and businesspeople have been punished for bribery. Businesspeople paid huge amounts to politicians for favours or to win government contracts. Two presidents have been jailed for taking bribes, as were the sons of two other presidents. Yet bribery scandals continue to surface.
The latest involves both the ruling and opposition parties. Top chaebol (conglomerates) allegedly paid tens of millions of dollars to political parties around the time of the presidential elections last December. Several people have been arrested. Several more are likely to face the same fate. The scandal even prompted President Roh Moo-hyun to call for a confidence vote.
It is incredible that South Korean companies continue to make illegal contributions to politicians, even after the 1997-1998 financial crisis that supposedly led to a clearout of bad practices. Accounting frauds have been busted and management transparency increased through various legal and systematic changes. At least that was what most people believed - until the latest scandal broke.
In the old days, tycoons routinely maintained large slush funds. Kickbacks were given to politicians and bureaucrats for awarding their companies lucrative projects. The practice was rife in government construction. Business leaders claimed they had no choice, as everyone was at it. And no backhanders meant they faced blatant discrimination in regular business activities, they argued.
But things have changed. Government contracts are no longer decided by the size of the bribe. Rather, a more fair and transparent system has been installed to allow the most-competitive bidder to win the contract. So why do businesspeople still pay politicians astronomical sums? The only explanation can be that they feel insecure if they do not. From economic policymaking to regulating business activities, politicians and bureaucrats wield too much power. The government is still oriented towards interference and politicians are too often regulation-minded.
And politicians continue to need money under the expensive election system. The actual cost of elections far exceeds the legal limits of campaign funds, leading politicians to seek illegal money. Large outdoor rallies are quite common and can add considerably to the bill, while campaign materials can prove costly, too.