Frequent ‘Crackdown’ and ‘Total Ruin’ Threats to the Public… First Time Since Chun Doo-hwan!

[Choice Times=Jin-An Kim, former Executive Vice President and Middle East Regional Head at Samsung Electronics]

President Lee Jae-myung said on the 6th, regarding the sharp rise in gasoline prices at domestic gas stations, that “price collusion and manipulation constitute a serious crime against the public.”

On that day, the president wrote on X (formerly Twitter), “Some companies have been making huge profits through illegal acts while inflicting suffering on the public, and they still seem unaware that the barbaric era—when such acts could be covered up through collusion with government officials and political circles—has come to an end,” adding, “They will soon learn how great the price will be.” Once again, it was a strongly worded message directed at the public.

Whenever an issue arises, President Lee frequently posts directly on X, issuing strong remarks to the public. He often uses extreme expressions such as “strict punishment” or “total ruin.” Even in matters related to real estate, such statements have repeatedly appeared. When such remarks are made, government ministries rush to implement them without proper verification—without examining whether the instruction is justified, what consequences its implementation might bring, or what costs the public might ultimately bear.

While these statements may be described politely as “strong remarks,” to those directly involved they are little different from threats and can create an atmosphere of fear.

Although the format has changed through social media, it feels unprecedented since the era of Chun Doo-hwan for a president to repeatedly issue threatening statements to the public. During Chun’s time, in the so-called “TV news that began with Chun,” he would often appear with a stern expression and declare that he would “deal with matters strictly.” I was too young during the presidencies of Syngman Rhee and Park Chung-hee to fully sense it, but from my university years onward—when I began paying attention to politics—this is how it appears.

It would be difficult to define the current political system as a dictatorship. However, considering how the National Assembly often pushes legislation through with the ruling party dominating and ignoring the opposition, and how government agencies rush to implement policies immediately after a single presidential remark—without public hearings or the gathering of public opinion—it is hard to deny that this may be the most unilateral administration since Chun Doo-hwan.

Just yesterday, President Lee posted on X that “just because one becomes president and the ruling force does not mean one can do whatever one wants, nor should one.”

He also wrote that “even when pursuing necessary reforms, care must be taken not to condemn everyone indiscriminately and turn the entire system into a target of reform—burning down the whole house just to catch a flea.”

The media interpreted this as a warning directed at the ruling Democratic Party, but reading the statement left me confused. Shouldn’t those words have been directed at the president himself?

Since taking office, the one who has often acted without consultation with the opposition has been the president himself. Government agencies may be described positively as moving in perfect coordination with presidential instructions—but viewed differently, they may simply be acting hastily. Coercive policies may produce short-term effects, but over time they often bring severe side effects.

The real estate market provides a clear example.

In 2005, former President Roh Moo-hyun, while strengthening the comprehensive real estate tax by applying it to homes with officially assessed values above 600 million won (combined per household), expressed confidence that speculation would soon be curbed and prices stabilized. He even declared that “the real estate tax system will not change even after the Roh administration ends. It cannot be changed.”

Former President Moon Jae-in also firmly stated that if existing measures proved insufficient, stronger ones would continue to be introduced to restore prices to normal levels.

Yet during Roh’s administration, apartment prices rose by more than 90 percent,  and during Moon’s administration they increased by 50 to 60 percent, with some apartments in Seoul’s Gangnam districts rising by more than 90 percent.

President Lee’s current statements and measures differ little from what might be called “Roh’s real estate policy, Part Three.” Policies born from misguided beliefs and rushed decision-making may create short bursts of effectiveness, but eventually produce backlash that sends prices soaring several times higher.

The same applies to the surge in gasoline prices.

A few gas stations may engage in hoarding, but most do not. They simply raise prices because suppliers charge more.

After the president’s remarks, government agencies reportedly launched comprehensive investigations and special inspections of gas station pricing. But what a waste of administrative resources. Simply examining the purchase and supply prices from fuel suppliers would quickly reveal the answer.

Even when the Fair Trade Commission detects suspicious market behavior related to collusion, investigations and rulings take months. Yet without properly examining gasoline suppliers, the situation is immediately labeled “price collusion.” If the president says it is collusion, does that automatically make it collusion?

Following the Middle East crisis, international crude oil prices have already risen from around $80 per barrel to over $100, with forecasts suggesting they could soon reach $120. Meanwhile, the Korean won has weakened beyond 1,490 per dollar, approaching 1,500.

When the surge in crude prices and the depreciation of the won are combined, the cost increase for refiners exceeds 30 percent. Yet retail gasoline prices have risen only from the mid-1,700 won range per liter to around 1,900 won, roughly a 10 percent increase.

If crude purchase prices have risen by over30 percent, is it reasonable to label gas stations criminals and subject them to special investigations simply for raising retail prices by around 10 percent? Are refineries and gas stations expected to sell fuel at a loss?

Some small business owners and drivers may cheer such remarks, praising President Lee as a strong leader. But such rhetoric merely reinforces the perception that companies are inherently immoral and divides the public. In reality, it is political populism that does nothing to solve the problem of soaring oil prices.

Japan’s response has been notably calmer.

After the U.S.-Israeli strikes on Iran, Japan’s average gasoline price rose by only about 13 won per liter, while Korea’s increased by more than 140 wonduring the same period. Korea relies on the Middle East for about 70 percentof its crude imports, while Japan’s dependence is even higher at 95 percent. Both the Korean won and the Japanese yen have weakened against the dollar, meaning exchange-rate effects are similar—yet gasoline prices in Korea rose nearly ten times mor ethan in Japan.

The difference lies in policy. Japan provides subsidies directly to refiners—about 25 yen per liter (roughly 240 won)—whenever international oil prices exceed a certain threshold. This prevents sudden spikes in retail gasoline prices and reassures consumers that prices will not surge overnight, thereby preventing panic buying.

Instead of attacking gas stations or refiners, the Korean government should immediately reduce fuel taxes and in the medium term diversify supply sources—securing alternatives such as Russia, Venezuela, and Kazakhstan that do not require passage through the Strait of Hormuz.

A few days ago, Chief of Staff Kang Hoon-sik announced the emergency import of more than 6 million barrels of crude oil from the United Arab Emirates (UAE). But immediate action—such as releasing 2 million barrels stored in Korea and 2 million barrels aboard Korean-flagged tankers stationed in UAE ports— would help stabilize gasoline prices more quickly.

If consumers believe prices will stabilize, speculative demand and hoarding will naturally disappear.

Should the United States attack Iran and disrupt the Strait of Hormuz, oil prices would surge dramatically. Such a spike would directly hit the stock market, potentially collapsing the KOSPI 6,000-point dream that the president has promoted.

History has shown this pattern repeatedly. If the government truly failed to anticipate the possibility of a U.S. strike on Iran, it would represent either negligence or incompetence within the administration’s diplomatic, security, and economic teams.

More likely, experts within the government may have anticipated such risks but hesitated to speak up—fearing political consequences while the administration remained absorbed in stock-market optimism.

When a president fails to listen to advisers and experts and acts first, such problems inevitably repeat. 

President Lee once criticized former President Yoon Suk-yeol for governing in an authoritarian manner and relying on unofficial channels. Yet he may not realize that he is now walking down the same path.

As oil prices surge, the stock prices of companies like Samsung ElectronicsandSK Hynix have fallen sharply. What will happen to young investors who borrowed money to join the semiconductor boom, encouraged by government optimism?

If the KOSPI reached 6,000 points, will it be credited to presidential leadership—while a sudden drop of nearly 1,000 points in just a few days is blamed on the Middle East war?