Where are our true guardians of public funds?

i hope to see a Korean among those who truly guarded
public funds by identifying disastrous populist policies.

Shin Hae-ryongThe author is a professor at Chung-Ang University Graduate School of Public Administration and former chief of the National Assembly Budget Office.

Government finance can mirror the past, present and future of a country. Account documents show where and how spending was made through fiscal management, how much is left in the coffers for future plans and what blueprints and strategies are needed to change the course for a better future.

According to the National Assembly Budget Office (NABO) Fiscal Projections for 2023-2032, tax revenues over the next decade are expected to slim by 5.1 trillion won ($3.5 billion) while fixed expenditures are expected to surge by 29.5 trillion won. This projection offers a picture of the daunting test of wrestling with bigger spending needs against smaller incomes over the next decade. Balancing revenue and expenditure has always been challenging, but the going will get tougher due to a widening gap between income and spending.

The Sound Public Finance Forum two years ago polled people in their 20s on their desired outline for a national pension reform. The survey first asked them what came to their mind when considering national pension. Answers included “ice age, ticking bomb, frayed lifeline rope, drying well, bottomless hole, sandcastle on a beach, torn-up piggybank, first-come-first-serve, generational gap, countdown, pass-the-bomb and something uncollectible.”

The younger generation accused politicians and administrators for neglecting their duties by not trying to stop a bomb while knowing when it will explode. Who can mitigate the younger generation’s anxieties and skepticism about the looming pension disaster coming from a lack of transparency, fairness and responsibility?

Shoring up state coffers is imperative to meet to the gush of fiscal demands from the seismic changes in the demographic landscape from the ultra-low birth rate and fast aging. But the sustainability of the welfare budget cannot be guaranteed due to frequent shortfalls in tax collection and resorting to government-issued debts to cover the fiscal deficit. We must enter heated discussions on ways to stock up the war chest for childcare, education, medical services, pension and other welfare spending and raise the efficacy of one-time cash support programs.

To address the vagaries of fiscal challenges, public offices in charge of planning, supervising and executing budgetary spending must fully play their roles. Each of them need to solemnly take up their roles in the political, planning and administrative fields. Citizens also must uphold their duty to monitor unlawful spending of the budget and funds as mandated by the National Finance Act.

Before resigning in 1988 at age 72, Sen. William Proxmire, a six-term Democrat representing Wisconsin, recalled that he had devoted his legislative service mostly to stopping wasteful spending. He was proud of creating the Golden Fleece Awards in 1975, which are given to U.S. government officials for squandering public money on a monthly basis.

Another Democrat, Rep. Jim Cooper from Tennessee, created the Golden Goose Awards to celebrate breakthroughs from federally-funded scientific research programs which seemed obscure at first, but later became geese that lay golden eggs.

Republican Senator Tom Coburn was dubbed “Dr. No.” by his Democratic colleagues for his staunch conservatism in battling lawmakers against pet projects for their constituencies.

Tommy Douglas, a former Saskatchewan premier, was named the “greatest Canadian of all time” in a 2004 CBC poll for his role of founding Canada’s healthcare system. He contended that nothing can be more important than feeding, clothing and caring for the people. “We are all in this world together, and the only test of our character that matters is how we look after the least fortunate among us,” he said. He upheld his conviction on a universal healthcare system regardless of the unpopularity and resistance to the concept at the beginning. The aforementioned examples make them the role models as true guardians of public funds.

History records the opposing fates of countries under populists who wrecked public finance with reckless spending and those under prudent management. Harvard University Prof. Niall Ferguson warned that the fall of an empire always came suddenly and that what matters in fighting a financial crisis is winning public trust in the ability to battle the crisis. I hope to see a Korean name among those who truly guarded public funds by identifying disastrous populist policies.

Translation by the Korea JoongAng Daily staff.