Trump is not liable for our own problems

We can’t expect a successful presidency from a leader if he wants to avoid facing the anxieties of the people.

Jung Hyo-sikThe author is the social news editor of the JoongAng Ilbo.

The economy has an aversion to uncertainty. Fear from the sense of insecurity tends to sink in when it’s hard to tell how the future unfolds. This explains the panicky selling spree in Korea’s financial market. Concerns about Trump 2.0’s negative impact on the Korean economy has stoked jitters among foreign investors as well as Korean retailers and institutions. The fear factor is snowballing in the week following the election results.

Foreign and institutional investors sold a net 2 trillion won ($1.43 billion) in Korean shares, as of Wednesday, since the Nov. 5 U.S. election. The main Kospi tumbled 6.2 percent. Nearly 5 trillion won has been withdrawn from stock funds since Nov. 7. Instead, domestic investors’ deposits for U.S. stock investment stretched to $103.5 billion from $97.9 billion during the same period, according to a posting on the Korea Securities Depository’s Securities Information Broadway (SEIBro). Capital is quickly migrating from Korea to the U.S. market.

Should Trump’s return to the White House be that shocking to trigger this much panic? His first election victory in 2016 caused stupefaction, but the second needs not. Trump’s first triumph took the world by surprise. American economist and UC Berkeley Professor Barry Eichengreen expressed grave concerns about the potential for increased uncertainty in the global economy. But this time, more than half the world’s population took Trump’s re-election as a sensible possibility. Whether they like him or not, they cannot erase the dramatic image of a defiant and bleeding Trump raising his fist shouting, “Fight, fight, fight!” after surviving an assassination attempt during a rally in Pennsylvania on July 13.

A Trump administration is not new. We have the reference book from his first presidency between 2017 and 2020 to help navigate through the Trump’s second term, which may make it easier to predict than the first one.

The Korean economy didn’t fare that badly during Trump’s first presidency. During his four-year term, the Kospi soared as much as 50.8 percent. The index dipped 2.25 percent upon the election results — and stayed wobbly for a month or so. But by the time Trump was sworn in on Jan. 20, 2017, it bounced back 3.1 percent. Exports to the United States surged 11 percent from $66.4 billion in 2016 to $74.1 billion in 2020 — regardless of the danger to the bilateral free trade agreement, Trump’s intimidating remarks about pulling the U.S. troops out of Korea and his demand for $5 billion in defense costs for the U.S. military presence in Korea on top of the tit-for-tat tariff war between the United States and China.

So, if Trump 2.0’s uncertainties are not the very source of the problem, what’s making Korean and foreign investors so nervy about the economy? The only difference in circumstances between 2016 and 2024 is our domestic politics. The two leaders — who must deal with Trump’s ideas on tariffs, trade and investment, as well as his impulsive reactions to North Korea’s nuclear weapons and missiles — are under greater legal risks than Trump, whose cases will most likely be dropped when he returns to the White House in January.

President Yoon Suk Yeol has his wife facing a re-investigation into her possible involvement in the Deutsch Motors stock manipulation case — and together with his wife, he could be implicated in the ongoing investigation of political broker Myung Tae-kyun who was suspected of meddling in a by-election in 2022.

Lee Jae-myung — the leader of the majority Democratic Party holding 170 seats in the 300-member National Assembly — awaits the Seoul Central District Court’s first ruling on his alleged violation of the Public Official Election Act on Friday and another ruling on his alleged subornation of perjury on Nov. 25. If the DP leader is found not guilty or slapped with a negligible fine, his legal risks will decrease. But the president can only deepen his own legal risks if he fails to clear up the suspicion on the presidential couple’s alleged intervention in nominations before the by-election.

President Yoon won’t be able to stand a chance when making deals with Trump if he faces the incoming U.S. president with his current dismal approval rating of 17 percent.

In his 1977 book “The Age of Uncertainty,” Harvard University Professor John Kenneth Galbraith wrote, “The one generalization that is entirely safe is that the great leaders have faced the major anxiety of their people in their time. This is the essence of leadership.” We can’t expect a successful presidency from a leader if he wants to avoid facing the anxieties of the people, not to mention his own.

Translation by the Korea JoongAng Daily staff.