(EDITORIAL from the Korea Times on July 22)

Ill-fated automaker: Government should not look on with folded arms

The intensifying police pressure on unionists at troubled Ssangyong Motor is
heralding another calamitous clash with a most dreaded consequence.
It is more than horrible to imagine what would happen if thousands of riot police
raid the painting plant filled with tons of inflammable materials and 600
unionized workers hit back with suicidal desperation ??? a recurrence of the
Yongsan redevelopment tragedy, probably on a far larger scale?
Needless to say, this is the last thing that should be allowed to happen by the
government. Related government ministers, particularly those responsible for
labor and industrial policies, should try their utmost to find a solution or
compromise. If the situation has already passed a stage to be handled by the
Cabinet, then Cheong Wa Dae ought to step in, starting with the withdrawal of the
police. There are ample reasons the government must not sit idle, saying it is a
matter between labor and management and their creditors.
As the market sees it, Ssangyong can hardly hope to remain alive. The automaker,
which mainly produces gas-guzzling luxury sedans and sports utility vehicles, has
failed to cope with the changing industrial environment. It may be the Korean
carmaker most resembling the Big-3 U.S. auto giants ??? as far as their declining
process is concerned. But there is a world of difference in how the U.S. and
Korean governments have dealt with their troubled carmakers.
The Barack Obama administration has braved all risks and even criticisms about
the virtual nationalization of General Motors and Chrysler for their repackaging
and restart after far shorter-than-expected corporate resuscitation procedures.
It was against the backdrop of such active governmental efforts that the UAW
union made corresponding sacrifices. The Lee Myung-bak administration needs to
ask itself whether it has made ??? even thought about ??? similar efforts.
It may be because Ssangyong is not too big to fail unlike with its U.S.
counterparts, but at stake are the livelihoods of up to 200,000 people. In a
country that has an extremely loose social safety network that the dismissal of a
breadwinner means the plunge of an entire family, the government and management
are demanding only to kill a few to save many. That policy has already led to
five Ssangyong-related deaths, including the latest suicide of a union worker's
wife reportedly for fear of dismissal, arrest and seizure of property.
The ill-fated automaker is also the victim of the previous administration's hasty
policy to induce foreign capital, as its former owner, Shanghai Motor, proved to
be a stingy investor, which reportedly was only bent on abstracting the Korean
company's core technology. So the smooth solution of the Ssangyong case will free
the opposition Democratic Party from the burden of its past mistakes as well as
provide the governing camp with the opportunity to show that its
``worker-friendly'' policy is real, not for some publicity stunt.
It may be just a coincidence, but the Obama administration spent $17.4 billion
(22 trillion won) on salvaging the two U.S. automakers, equivalent to the amount
the Lee administration is about to pour into its rivers project. Ssangyong's
rescue needs 500 billion won at most, only 2 percent of that total.
Casualties at the auto plant will be the worst-case scenarios not only for
victims, but also for the Lee administration. Not much better will be the
possibility of the carmaker's liquidation, the first ever, during Lee's tenure.
(END)