<html><body>Roh No More? March 26, 2004 Unedited transcript prepared from a tape recording <TABLE width="100%" border=0> <TBODY> <TR> <TD vAlign=top align=left width="25%"> 10:15 a.m.</TD> <TD vAlign=top align=left width="75%" colSpan=2> Registration</TD></TR> <TR> <TD vAlign=top align=left width="25%">  </TD> <TD vAlign=top align=left width="25%">  </TD> <TD vAlign=top align=left width="50%">  </TD></TR> <TR> <TD vAlign=top align=left width="25%"> 10:30</TD> <TD vAlign=top align=left width="25%"> Welcome:</TD> <TD vAlign=top align=left width="50%"> Nicholas Eberstadt, AEI</TD></TR> <TR> <TD vAlign=top align=left width="25%">  </TD> <TD vAlign=top align=left width="25%"> Panelists:</TD> <TD vAlign=top align=left width="50%"> Lee Sook Jong, Brookings Institution Marcus Noland, Institute for International Economics  Scott Snyder, The Asia Foundation and Pacific Forum CSIS</TD></TR> <TR> <TD vAlign=top align=left width="25%">  </TD> <TD vAlign=top align=left width="25%"> Moderator:</TD> <TD vAlign=top align=left width="50%"> Nicholas Eberstadt, AEI</TD></TR> <TR> <TD vAlign=top align=left width="25%">  </TD> <TD vAlign=top align=left width="25%">  </TD> <TD vAlign=top align=left width="50%">  </TD></TR> <TR> <TD vAlign=top align=left width="25%"> Noon</TD> <TD vAlign=top align=left width="75%" colSpan=2> Adjournment</TD></TR></TBODY></TABLE> Proceedings: MR. EBERSTADT:  Ladies and gents, welcome to AEI this morning.  I'm Nick Eberstadt from the American Enterprise Institute.  You're very good to be in here on this beautiful day.  Spring is in the air.  In Washington the cherry blossoms are in bloom, and in Seoul, President Roh Mu Hyun's fate is before the Constitutional Court. We have three excellent panelists today with us to describe and prognosticate a bit about the upcoming dramas that we may see.  Our panelists today are Dr. Lee Sook Jong, now at Brookings in the CNAPS program; Dr. Marcus Noland of IIE; and Mr. Scott Snyder, still with Asia Foundation.  And I think you know them all already, so I don't need to go into long introductions.  Their bios are in our packet here, if you wish to look at these. I think maybe what we'll do, if we can be a bit informal about this, is maybe start off with our three presenters offering some comments maybe for 10, 12, 15 minutes each, and then go into a general discussion.  I think we'll go from left to right and start with Dr. Lee. DR. LEE:  Thank you for inviting me to this panel.  You know, the South Korean society today is very deeply divided, very emotionally divided.  I think one reason is that many South Koreans had been united, when we were under the authoritarian government, for the sake of, you know, democratization.  But once we achieved that goal, I guess our civil society has been very much divided over different ideological lines.  So, you know, we haven't come to terms with these ideological differences. Having said that, if you are a conscientious citizen of South Korea, you'll face a lot of pressure presenting your opinion in Washington, D.C., because you have to puzzle, you know, how well your opinion is representing the Korean society.  So with all this disclaimer, I offer you my observation of what's going on surrounding this impeachment scandal in South Korea. Actually, nobody expected our parliament would go for the impeachment.  Just the day before what really happened on March 12th was, you know, many people thought it's a political game because we are facing a general election on April 15th.  And our president, Roh Mu Hyun, became a president as a candidate of the ruling party at that time, in 2002--the former president Kim Dae Jung's party, the Millennium Democratic Party.  And he left the party in the autumn of 2003 and, even though he didn't join the Uri Party, everybody knows -- he's going to join the party.  So this small party, a breaker party from the MDP, in the fall of 2003 is becoming a ruling party, sort of.  And because this Uri and MDP were fighting over the same vote in specific regions, you know, we all thought it was a political game. However, with President Roh's press conference, all the games just switched, and our national parliament couldn't restrain their emotional reaction to the president's press conference because they thought President Roh didn't approach that [inaudible].  And actually, at that time even pro-Rohs thought the Blue House PR was a failure because the message wasn't framed well. [?]   However, actually, after the national parliament voted for impeachment, public opinion was strongly opposing the impeachment and pressing the two major opposition parties to record [?] their decision. So therefore, it's a very interesting public opinion.  Before impeachment, President Roh wasn't popular.  His approval rate was very low, like around 30 percent, because many Koreans were not happy with economic conditions today.  However, all the charges of impeachment, many Koreans thought the parliament went too far.  And I guess as many as 70 percent of Koreans opposed the impeachment.  So therefore, the backfire is actually giving a lot of leverage and a tremendous boost to the Uri Party, because the pro-Roh Uri Party is gaining a lot of popularity. Okay, then, what will be the prospects?  Because I'm given only 10 minutes, I'm going to be as brief as possible. As you know, we have to await the ruling of our Constitutional Court, and we expect, most of us expect the ruling won't arrive before the election.  It's going to be sometime after the election.  And they face tremendous pressure, because public opinion is for the president.  However, they will get very legalistic, legal issues, whether the president had violated election law and how seriously the court must interpret the neutrality of the president in the general election. But I guess many legal scholars are thinking maybe the charge isn't sufficient enough to impeach, to legitimize impeachment.  Then maybe the prospect is going to be like--our seminar title is "Roh No More?," but maybe the outcome is likely to be "Roh Much More."  So I think that's the major [inaudible].  But who knows?  Because it is a nine-member court that will very carefully review the legal issues.  And I guess, for the sake of rule of law, whoever you are, whether anti-Roh or pro-Roh, they should respect the ruling of the Constitutional Court. Okay, what are the impacts of impeachment?  There can be several issues--the economic issue, there is no significant economic impact.  Business is as usual.  You know, I guess the Korean stock market declined just several days, but it came back again to the normal stages and I don't see any disruption for foreign investment and so forth. And for the six-party talks, of course North Korea protested against the impeachment of President Roh.  Quoting, you know, because of the impeachment and, at the same time, the common military exercises between the U.S. and Korean troops, they wouldn't come back to the table.  But I don't think so.  If they are not coming back to the six-party talks, it's because of other reasons rather than impeachment. And then my worry, maybe, concern is after the election.  Because right now, if you look at the composition of the Korean national parliament, the opposition party, the Grand National Party, makes up 51 percent; the New Millennium Democratic Party makes up about a quarter of parliament; and the Uri Party, this new party, President Roh's party, makes up only 17 percent.  But everybody predicts that with this impeachment backfire, the Uri Party is likely to come up with the majority party in our parliament.  Then that means there will be some very significant influences to the domestic politics in South Korea. There are number of aspects I can point out.  Number one, we passed, our parliament passed the bill to send our troops to Iraq.  And our government promised to send our troops, 30,000 Korean troops, to Iraq by the end of April.  But because the area where our troops are supposed to go became dangerous, the two parties, the South Korean government and the U.S. government, are negotiating again which place we should send our troops.  That can be postponed until after the election.  Then I guess if the Uri Party became the majority, they might reconsider the decision, the parliament's decision to send our troops.  Because the Uri Party sentiment is more like anti-war, and there are many pacifists and many civic activists.  So therefore, that will be one area. Second is national security law.  We have a national security law trying to, you know, watch some spies from North Korea and trying to ban the kind of communist infiltration and so forth.  And this law has been attacked by many progressives, that it's not a proper law in a free democratic society.  So therefore, this is another area, that this law may be dismantled if the progressive Uri controlled our parliament. And also, I guess another one is the specific area [inaudible].  You know, our society has been very bitterly divided.  And we elected a progressive president.  However, our national parliament has been controlled by the conservative majority party called GNP, Grand National Party.  And if the Uri Party will be able to claim the majority of the national parliament, that means President Roh and the parliament can push more actively progressive agendas in the future. And because our Korean politics doesn't have a tradition of compromise and moderate, that kind of thing, our politics has been quite extreme.  So therefore, there will be more and more political fighting between conservatives and progressives.  And I wonder, if President Roh comes back again, how can he lead the politics, how can he demonstrate the leadership in reconciling the different social forces in Korean civil society? Some people say if he feels comfortable because his party is going to claim the majority in the national parliament, he's going to be more flexible and he's going to be more confident, so will go for more politics for harmony and reconciliation.  But some skeptics are worrying that, regarding his style of politics, he's going to be more for [inaudible] politics in pushing the agenda, therefore deepening the social conflicts. I don't know.  I cannot bet on this issue, though.  But overall, you know, then what's all this thing about long-term perspective of the democratic consolidation of South Korea?  Many people say this is growing pains to be a more pluralistic and solid democracy.  However, I feel like we waste too much energy and time because of lack of better tradition.  You know, if [inaudible] democracy, that means we have to be more modest, we have to consider and respect the minority, and we have to restrain some disturbing things.  But today in Korean politics, there is a lot of character assassination and there is a lot of political labeling, which is not necessary, and all these extremes. So therefore, I think it's unfortunate that we, although our society is gaining its footing, you know, South Korea must go to [inaudible] because, you know, our per capita GNP is only $10,000.  But we want to double our per capita GNP in the future, literally to be a proper member of the OECD club. However, with all these divisive politics and excessive mobilized politics, I think, yes, we may achieve a consolidating democracy if we can be wising up to restrain and come to terms with different ideas and respect different ideas.  I'm a little bit skeptical, but we have to see and wait. Thank you very much. MR. EBERSTADT:  Thank you very much, Sook Jong.  Marcus? DR. NOLAND:  Thank you very much.  It's a great honor to be invited to speak on this panel with Nick Eberstadt, Lee Sook Jong, and Scott Snyder. Now, I was trained as an international trade economist, and after listening to Professor Lee's presentation, I suspect that I have an absolute disadvantage in all activities.  Yet, as an international trade economist, I know that one can always find some comparative advantage, even if you are at an absolute disadvantage in everything.  So I will focus on the economic side of this. But before I do so, I'm going to talk a bit about politics if for no other reason, to provide some context for the subsequent economic remarks so at least you know where I'm coming from.  And I do that with a bit of trepidation.  As a rule, I am reluctant to second-guess the tactical maneuvers of foreign politicians, on the principle that they know more about their political system than I do. But in this case, the subsequent events in South Korea and the presentation you just heard from Professor Lee, I think, justify the notion that President Roh's opponents have made a serious miscalculation.  As in the October self-referendum episode, President Roh has rallied support by framing the issue not as his absolute level of competence or incompetence, as the case might be, but rather as a relative choice:  Do you want me or do you want him?  And by reframing the issue in that way, he has rallied support. Now, that's not to endorse gambling with the constitution as a desirable thing, but to simply say that, at least in the short run, this seems to have been effectively tactically. I think the selection of Madam Park as the head of the GNP smacks of desperation.  And I agree that, reading the polling data, it now seems likely that the Uri Party will emerge with a plurality if not an outright majority in the National Assembly.  If the supreme court, as expected, does not ratify the impeachment, then, at the end of the day, President Roh emerges strengthened--he's in office; he's got, if not a majority, at least the possibility of a stable governing coalition in the National Assembly. Now, generational change is a theme of South Korean politics, and it has proceeded further on the left side of the political spectrum than on the right, so one long-term benefit to this episode could be that, if it blows up in the way that I expect, that it may so thoroughly discredit the aging leadership of the GNP, that what we will observe is a more modern generation of younger conservative leaders emerging, in effect completing the process of generational change in South Korean politics.  And Scott Snyder, you know, can quote you chapter and verse about who all these people are. So that's my perspective on the politics.  So what about the economics, which I'm supposed to actually know something about?  Well, in the short run the economic implications are not huge.  At present, external demand accounts for most of South Korean growth.  And as long as China and the United States continue to suck in South Korean exports, the economy, in effect, can continue to grow on autopilot.  And indeed, some South Korean government officials that I have contact with, from their own personal perspective actually think that the hand-over of power to Prime Minister Goh Kun may actually de-politicize the policy-making process--remove some of the micromanagement of implementation of bureaucratic decisions and actually improve policy implementation in the economics field, at least in the short.  The ratings agencies have announced that they're not going to downgrade South Korean sovereign debt, as Professor Lee mentioned, the financial markets seem to have basically shrugged this off. That said, the possibility for capital flight exists in South Korea in a way that it did not exist 10 years ago, because of changes in regulation and changes in the South Korean financial markets.  Likewise, the use of off-balance-sheet derivatives has expanded tremendously in the last two or three years.  And so if this is not resolved relatively quickly and relatively painlessly, it is a potentially highly combustible mix. So in the medium run, this could start to bite.  South Korean domestic demand remains weak.  Household or private consumption is actually shrinking, largely because of balance-sheet problems.  Corporate investment remains tepid.  And there are decisions that the government needs to make that actually require political leadership.  At the same time, the basic engines of the South Korean economy at this point--that is to say, demand in China and the United States--are expected to moderate sometime in the future.  And so the kind of flying on autopilot, relying on external demand, is not a recipe for growth in the medium run. In the longer term, if the political crisis can't be resolved or is resolved badly and South Korea develops a reputation for political instability or a kind of populism which could have a kind of xenophobic edge to it, then the cost could be considerable.  The country is essentially caught between China on the one hand and more developed countries of the OECD, such as Japan and the United States on the other, and it continually needs to restructure to maintain its competitiveness.  Now, between, say, 1997-98, at the time of the Asian financial crisis, and the present, South Korea has made more progress in structural change than any country in Asia, Japan included.  But if that progress, that financial and economic reform progress was to slow down, then you could see declining relative competitiveness. And there are a number of issues on the agenda, which I could go into if you're really interested in the details, that South Korea needs to address.  And if there isn't effective political leadership, those issues don't get addressed, then the relative competitiveness of South Korea will begin eroding. A number of the knotty issues that the government faces involves the role of foreign firms in the economy, and sometimes not in ways that may be obvious to you.  Let me give you an example.  One of the big issues South Korea currently faces is how to deal with the explosive growth of credit card debt, the fact that much of this debt is essentially no good, and that you've got this big firm that is stuck with all this non-performing credit card debt, LG Credit Card.  Now, the way that the South Korean government would have handled that problem in the past is to basically dragoon South Korean financial institutions to bail out LG Credit and, you know, sort of kind of force through a solution. The problem is, is that Citibank just bought a Korean bank and must be scaring the bejeezus out of Korean commercial bankers.  And that is not an agency that you can dragoon.  Okay?  And so the ability of the government to do the kind of old administrative guidance-type solutions to problems in the financial sector is disappearing with the process of globalization.  And if you get a situation in which you get an unstable or populist government that makes appeals to nationalism and anti-foreign sentiment as kind of part of its political program or appeal, then you could actually start creating problems in the internal economy in ways that might not be obvious to outsiders.  And this could become an impediment to the really quite successful process of globalization, which has delivered enormous benefits to South Korea. Now, having said that, I doubt it will happen.  To simply reiterate, there is here a potentially highly combustible mixture, but thus far it hasn't ignited.  And I expect that this will be resolved relatively quickly, relatively painlessly, and that President Roh will emerge strengthened.  As one market participant with whom I'm in regular contact put it, South Korea is not a Nordic democracy, but it's not the Philippines either. MR. SNYDER:  Well, likewise, I'm glad to be here.  I appreciate Nick's invitation.  In fact, I received the invitation just as I was arriving back in Korea last week for a few days.  And we have a special interest at the Asia Foundation in this particular crisis because I have a parking spot at the Constitutional Court, and it turns out that we definitely don't want any riots or demonstrations because that would put our automobiles in danger. But it was interesting to go back and see that, you know, the court, which normally is a very quiet, sleepy place, is now at the center of this particular political crisis.  And I would say that, in a way, the highlight on the court is even more striking for another sort of set of observations that I want to try to make about the Korean inauguration when President Roh came into office, compared with the U.S. inaugural process. It was very interesting to me.  I was there at the Roh Mu Hyun inauguration.  What was most interesting to me was that, when it was time for him to be sworn into office, he actually swore himself in.  He made an oath to the people.  And I didn't see any court justices anywhere in sight.  And of course that's very different from the U.S. inaugural process, where you have the Supreme Court justice there administering the swearing-in.  I think that, in many respects, this may illustrate sort of, you know, the missing element or the sort of wild card at this particular moment, with regard to, essentially, how will people regard this institution, the Constitutional Court, which up to now has been, you know, present, but basically an observer on the political scene in Korea--not really playing a significant role, and now the spotlight is on it. I think this is really the critical issue.  So far, I think that the procedures of democracy have worked.  Nick, in his piece, is a little bit more pessimistic; I'm going to try to give the silver lining on this.  So far, I think that the process has proceeded constitutionally.  The question is, you know, what happens if the judgment of the court is not accepted by the people? And it also raises the question of how does this Constitutional Court look at this issue which has been given to it, which is essentially, I think, as the previous panelists have suggested, it's a political issue.  But the court is used to dealing with matters of law.  And so I think that the prism through which the court approaches this is emerging as a central issue in terms of how one views the particular question of the legitimacy of the impeachment.  If you view it from a strictly legal perspective, you may come out with a slightly different judgment from if you view it as a political issue.  I happen to think that it's primarily a political issue and that, indeed, the Assembly--as was the case to a certain extent with the impeachment of President Clinton--responded with a political judgment about President Roh's performance. But what does this mean in the broader context?  I mean, the other aspect of this that is really quite interesting is that the National Assembly took this action right at the time when the public referendum on its own future is up.  I mean, it's not as though the National Assembly had a long time frame.  And so I think that adds to the politicization of this particular decision and really puts the spotlight on the potential for changes or reforms that can accompany crisis.  I would say that this political crisis in Korean politics is analogous in some respects to the economic crisis in 1998, in that elections in Korea have been, over the course of the past few years, a catalyst for reforms. I would note the introduction of the primary system in 2002 and also changes in the way that the candidates have been selected for this National Assembly campaign.  Now you have what is essentially, I would say, a kind of last gasp on the part of the old elites to try to exert their power and influence in the process.  And in many respects, the impeachment, I think, turns out to be quite illustrative and reflective of the failure of that old point of view, in the sense that one of the reasons why the impeachment came about, according to my understanding, is that the people in the opposition got together and talked to themselves and nobody opposed the idea of impeaching President Roh.  In fact, everybody that they talked to thought it was a great idea.  The only problem is that they weren't talking with the broad majority of the public.  They were just talking with their own circle.  And so in fact it throws into relief, to a certain extent, some of the choices that are being made as part of this process. And so, you know, essentially what we're likely to have, I think, what I'm hoping that we'll have, is the emergence of a more representative system, where the National Assembly members, they're running in their districts for the favor of the voters, they're not necessarily nearly as beholden to the party leadership, to the political boss, as has been the case in the past.  And so I think that we're going to see a much, hopefully, more interesting National Assembly in the future. I would just want to mention a couple of features of Korean politics as we look at this National Assembly campaign.  One is very strong anti-incumbent mood.  It was pervasive before the impeachment ever came about.  And now the voters have the opportunity to make their voice felt. The other aspect that we see that I think is very interesting is the emergence of mobilization politics.  I mean, the way that the campaign is being handled and the way, for instance, that these candlelight vigils are being handled, which are ostensibly about the impeachment of President Roh, is a good example of the way that university politics from the 1970s and '80s have now been expanded to a national scale in Korea.  This is the same type of political mobilization effort that we saw on university campuses. One of the effects that this particular style of politics has is to give the impression that the majority of people who are out on the street are going in a particular direction, and I think it tends to sort of silence minority voices, to a certain extent.  And it can be a very effective way of mobilizing support and expanding support for a particular side. Another thing that a lot of people are looking at is, you know, does this mean the end of regionalism?  President Roh himself has said he wants to bring about the end of regionalism.  And what I'm expecting is not, you know, a de-alignment in terms of region, but a realignment, in the sense that we have new party heads.  And so we have President Roh associated with the ruling party, you have Chung [inaudible] in [inaudible], Kim Dae Jung is gone, and so that means that allegiance to the Millennium Democratic Party may also go.  Park Geun-hee is a reasonable choice in that she also protects the base for the [inaudible], the GNP. And so, you know, it's going to be very interesting to see what the electoral map looks like after this in terms of whether or not we really see a breakdown in regionalism.  The only place I think that's really true is in Seoul and [inaudible] Province, right around the capital. I just want to mention two other things that I think are very interesting about the discussion, the rhetoric surrounding the impeachment action.  One, some observers have referred to this as a kind of legislative coup d'etat.  I personally have a little bit of a problem with that particular phraseology because, in fact, it might have been a stupid thing for the National Assembly to do, but they do have a constitutional right to proceed with impeachment.  And so I think that it's not quite a correct term to call it a coup d'etat. The other thing that's very interesting is that the ruling party, there are some contradictions in the logic of the ruling party in this particular case, in that--I mean, they were a minority party in the National Assembly.  There's a lot of debate over the procedural issues related to this action within the National Assembly.  They were blocking the National Assembly action from proceeding.  And they complained, because the speaker was overlooking their rights as a minority.  And I think that they have a kind of point.  But then on the other hand, they've suggested that the impeachment itself is not legal because it ignored the will of the majority of the people. And so I think this issue of trying to find the right balance between--especially in a society like Korea, that is very ethnically homogenous--finding the right balance between protection for minority rights and the will of the majority is an issue that I think, you know, is sort of hidden in the mix here, but it's a very interesting one that I think deserves greater scrutiny within Korea. How is this going to come out?  I think that, as the panelists have suggested, the Uri Party has come out with a great bump, something like 20-point increase in the public opinion polls.  They're now at about half.  And in fact the Uri Party appears to be likely to be a mainstream party.  And, you know, whereas the issue prior to the impeachment was would they be the biggest party or not, now the question seems to be can they get a majority or not.  So they've definitely been helped by this process.  And whether or not they get a majority is a critical question if President Roh comes back to office, because thus far his tendency has been--he hasn't been a good coalition builder, and yet, if he gets a plurality, he's going to need to build a coalition in order to have a majority in the National Assembly.  And I think this will be a very interesting test.  What most people, I think, are hoping is that, you know, President Roh also will come back as a kind of new President Roh and that he will conduct his activities in a more secure way, at least psychologically. And then the question is, well, what about the opposition.  Well, Marcus said maybe there will be some conservative remade opposition.  Another possibility that is interesting to consider is whether or not Roh himself, as a representative of a mainstream party, could face opposition from the left.  In other words, is there somebody who's more reformist who comes on the scene than President Roh himself. And then the other issue that I would just sort of highlight is the question of, okay, if the Uri Party becomes the mainstream party, would they be able to survive without an opposition or with a weakened opposition.  And what I mean to point to there is that there are, I think, some hidden fissures within that party that would be tested in the aftermath of the election. I'll just conclude there and we can-- MR. EBERSTADT:  Scott, thank you very much.  Lady and gents, thank you all for your comments. I know that our audience is going to have a lot of questions.  Before I open the discussion, I'd like to take my prerogative as moderator to pose a question to all three of you.  I spend a certain amount of my time thinking about North Korea, which is to say about a Korea which--socialism with Korean characteristics.  Today what we are talking about is democracy with Korean characteristics.  And as I try to think about some of the characteristic features of ROK democracy, I just came up with a list of seven--which you may agree with or not--which are these: First, the perennial weakness and short half-life of political parties.  Secondly, personality-driven political organizations.  Third, a lack of a loyal opposition mentality in politics.  Fourth, an extremely wide level of discretion for the executive branch in administration.  Fifth, a lack of transparency in administration.  Sixth, an apparent shift--Scott might contest this--an apparent shift from the salience of regional cleavages to ideological cleavages in politics.  And finally, a pervasive and dramatically pronounced low level of public trust in politics as usual. I'm interested in how our panelists imagine the ongoing impeachment crisis may affect some of these features of Korean democracy.  Any speculations you have about this I would be fascinated about, if anyone wants to offer some observations. DR. LEE:  I think there would be a lot of change.  I guess, you know, our party system had been driven by very strong leaders who enjoyed the regional mandate, like Kim Young-sam and Kim Dae Jung, not to mention also Park Chung-hee a long time ago.  So therefore, with the passing of three Kims, including two former presidents and Kim [inaudible], and with the new leadership, because President Roh actually symbolizes the post-three-Kim politics in Korea, I think that obviously there will be a new leader, younger leader, who has regional loyalty or more driven by a national agenda. So in that aspect, [inaudible] I think you're right, there will be more a shift from the regionally based party system to a more idea-based party system.  But however, whether these parties are going to be strengthened, I'm not sure because, as Scott mentioned, our parties [inaudible] can be more democratized because there is not a strong person sitting and influencing all the intra-party politics; there will be more--power in each party is going to be more shared and they're going to deliver more a national agenda.  So in that aspect, it's good for the democracy. But at the same time, because our parties are emerging very weakly, even though you are saying we are switching to an ideologically based party system, if you look at, actually, all the candidates of the Uri Party, even, they're a kind of mixture.  So therefore, right now it's more like a very big push against incumbents, because incumbents were perceived as very corrupt and incompetent.  So that means, although they succeed in giving up more new blood that is less tainted, and new political leaders, there is no clear substantive difference in terms of political party ideological line.  That means there can be a hidden fissure, even within the Uri Party.  Because after all these deals [?] of clean-politics reform has faded away, there can be some difference in terms all these very important ideas. So therefore, yes, that means the party alignment is going to be more continued in the future, and that means a kind of instability in the political party system in Korea in the future. However, I think, among the list you have mentioned, the public mistrust toward the National Assembly is going to be improved, in my opinion.  Because as these new, more cleaner politicians come up, this tremendous cynicism and mistrust will be softened. DR. NOLAND:  Very briefly, I think that the hope one might have coming out of this is precisely that it would contribute to a more ideological and less regional basis of South Korean politics.  My concern coming out of this is that it's going to contribute to more populist politics. And in my remarks I was using the term "populist," but I did not mean that synonymously with "nationalist."  I mean, one can be highly nationalistic without being populist.  But what I'm afraid of is that what we're having in South Korea is a trend towards a very populistic nationalism which, given South Korea's position in the international economy and the requirement that South Korea be able to interact with foreigners--foreign entities, foreign governments, foreign firms--in order to provide for its economic prosperity, that that could be undermined by a rise in populist-- [tape change.] DR. NOLAND:  --a rise of ideology as well.  But I think regionalism isn't dead.  In fact, what it really is, is that it's the introduction of ideology into Korean politics.  Because in the past, I think, through the '80s and into the '90s, really, Korea had half a political spectrum.  Now, I think that what we've seen, although it's been obscured by the terms of political debate between the ruling party and the opposition, is the broadening of the political spectrum to include as a legitimate part of political debate progressive ideas that had previously been excluded from the political discussion. The really big challenge, I think, related to many of the characteristics that you defined, I think this is an issue that Korean society as a whole is struggling with right now, is essentially the issue of social capital--as Sook Jong mentioned, the issue of compromise, can institutions, can competing in-groups find ways to actually compromise instead of playing a winner-take-all style of political gain. I think that's going to be, you know, a really critical puzzle that I think people want to solve, but the practice of debate is not well inculcated.  We can see it in terms of some of the deepened divisions, like generational divisions.  Actually there's a huge problem with, you know, older people and younger people even being able to talk to each other about issues, much less debate them.  It may be just people in their 50s versus people in their 40s--if the older people are in the room, they're the ones who are going to talk. And the other observation that I think is really interesting and important that I just want to come back to is actually the National Assembly, I think, has become more important as part of Korean politics.  And one reason for this is that President Roh is a "weak" president.  And what I mean by that is that he's actually voluntarily, in certain areas, given up some of the, you know, powers--some people might say abuses of power--that some of his predecessors had exercised.  And so that, actually, demands more responsibility more responsibility of the National Assembly.  And so I think it's going to be very interesting to see where the candidates who have been selected and are currently running can, essentially, live up to their new-found responsibilities.  Because in fact this body, within the Korean process, is going to become more important. MR. EBERSTADT:  Thank you very much.  We can open up to a more general conversation now.  Could I ask you, please, to wait for the mike and to identify yourself and then indicate whom you'd like to address your comments to.  Bill? QUESTION:  Thanks, Nick.  I'm Bill Drennan from the U.S. Institute of Peace.  I have a couple of questions that may require opening it up to the audience as well, because we have an economist and a couple of political scientists onboard, and these are legal and procedural questions. The first one is that I note that the ROK has, in addition to a constitutional court, it has a supreme court.  And I would like to know if there is any role that the Supreme Court plays in the impeachment, or does the matter reside solely and exclusively with the Constitutional Court?  I've never been able to understand the relationship between those two courts.  So that's one. The second one concerns the procedures around which the presidency would be filled if in fact President Roh is removed from office.  What comes next?  How is an election scheduled, when would it be scheduled, and would Roh Mu Hyun be eligible to run in that election? MR. EBERSTADT:  Bill, I'm surprised you're confused about these questions.  Article 65 makes them crystal clear. Is there anybody who can actually answer these issues? DR. LEE:  The decision is exclusively on the ruling of the Constitutional Court.  Because for the impeachment of a high-level public servant, including ministers--not to mention a president--is solely up to the hands of the Constitutional Court.  Nothing to do with the higher court.  So therefore, if the decision comes in, that's it.  That's going to be final. And what is next--the election.  Of course, these nine judges are very highly respected judges.  And these nine members are appointed by the president, but the president can recommend only three.  And another three will be elected by the parliament.  Another three will be nominated by the Supreme Court justices.  So therefore, it's a checks-and-balance composition.  And if the court decides there's a legitimate decision by the parliament, we have to call the election again.  And if President Roh Mu Hyun is impeached, he cannot run for the office. QUESTION:  Eric McFadin [sp], a consultant on East Asia security affairs.  If President Roh does in fact emerge as a stronger, revitalized president, what is it going to say for the relationship with the United States?  I mean particularly things like the alliance and the efforts to realign our forces there, the six-party talks, and so forth. MR. SNYDER:  Well, I think that if you look at what President Roh has actually done so far in terms of the relationship with the United States, the actions that Korea has taken have been very consistent with the past.  In fact, you could argue that despite this ideological debate over the sacking of the foreign minister, I mean, I think that there is a broad-based recognition within the Korean foreign affairs-related institutions that the relationship with the United States is an important one for Korea.  And so I think that, in terms of cooperation with the U.S., you know, the primary issue of concern is to what extent does it become politicized.  Because I think the way the president and the way that some of his party members talk about the relationship sometimes, that is what introduces some of this perception of dissonance. With regard to the six-party talks, I think it's clear that this incident is marginalizing Korea from the process, to a certain extent.  They've indicated they'll continue at the working level with these meetings, but in fact there is a sort of limited capacity in terms of, you know, at the very senior levels for Korea to be able to carry out its--you know, take a proactive role. QUESTION:  You know, I'd like to pursue a little bit this question of the fissures within the Uri Party and how they might play out.  If the Uri Party does indeed become what you called, Scott, a mainstream party, then it will have to react in ways that a mainstream party is expected to do.  And the core supporters [sound loss.] How do you see this playing out, particularly the two of you who lived in Korea?  I'm thinking about the Democratic Party after Bill Clinton was elected, for example, and he felt the need to move to the center and basically marginalize a lot of his supporters on the political left.  Are the personalities that are now surrounding Roh Mu Hyun in his administration going to have to be replaced, if Roh was going to do that, or will they have enough flexibility to become a more mainstream party?  How do these fissures play out? DR. LEE:  You know, why many Koreans are sympathetic to President Roh and why the Uri Party became popularized [?], not because the majority of the Korean voters are leftist, but because they tend to see President Roh as the underdog and because they mistrust.  Again, the [inaudible] national parliaments tend to be stronger, so how more [inaudible] are ousting the president, that kind of feeling.  So this demand for the clean politics is the major force. Okay.  Then if the [inaudible] demand from the populists if the Uri Party became the majority party and became a mainstream party, well, I don't think--it's true that President Roh, after he went to the Blue House, he brought many progressive or leftist aides to his Blue House and NSC.  But I don't think they are [inaudible] to take any risks, for example, to take a risk like in terms of the U.S.-ROK alliance or whatever.  So if you think his aides are too left, that can be an exaggeration.  But -- President Roh is going to replace them?  I don't think so.  I think he will be more confident, and his "leftist" aides and hands [?] will be more comfortable and confident to push their agenda. MR.       :  To add a word or two on that, I think there's no reason to expect the U.S. model to be replicated in dealing with this particular crisis.  I mean, the U.S. model, to exaggerate and oversimplify, is to have someone too far from the center do an ideological crash-and-burn, and then to bring in the fixers.  You know, most recently, in the Clinton administration, bringing in people like David Gergen from the opposite party or Bill Cohen from the opposite party to try to moderate and smooth things over. One of the reasons I think it's structurally less likely to see this in an ROK context is because of the aforementioned distrust and disgust that the public feels for much of politics-as-usual and many of the practitioners who are so very good at it.  So bringing in people who are so very good at politics-as-usual, I think, would kind of add to the difficulties of the Blue House. MR. SNYDER:  I just wanted to add two things.  One is, you know, President Roh's relationship with the party itself is, A, not yet clear, but B, not necessarily potentially terribly cozy.  And so I think that the leadership within that party may be more centrist than his own, you know, personal sentiments. The second observation I would make is that I think a lot of it depends on whether or not President Roh can reconcile himself, as an outsider, to being at the center of power.  And, you know, one of the big problems so far has been that, even though he's the president, it's as though he keeps on pinching himself and he still thinks it's a dream.  And he's got to start recognizing that he and his administration actually are in power and they have to take responsibility for their position. DR. LEE:  Can I add, because I tend to agree with Scott.  For example, yeah, his point of whether President Roh is going to be comfortable and cozy with the Uri Party is quite questionable.  Because the Uri Party is an interesting mixture, but there is a [inaudible] number who tend to be critical of the USA.  But [inaudible] the other minority.  Let's say they push for, like, withdrawing the decision to send our troops to Iraq, I don't think President Roh will listen to them.  He's going to try to restrain them within the party to go for his original decision.  So I think in that way he can be more moving and trying to--I don't think there is a 100 percent honeymoon relationship between Uri and President Roh. QUESTION:  I'm Charles Piquot [ph] with Korea Monitor.  I'd like to know if anybody can explain the, or compare and contrast the impeachment process in South Korea with the impeachment process in this country, and can you draw any parallels, or not, between the impeachment of President Roh and the impeachment of President Clinton? DR. LEE:  I know President Clinton's case, of course, the Senate has to approve.  But our case, it's not a two-level parliament, it's just one.  We have only one congress.  So therefore the congress, national parliament, decides to impeachment the president, it goes to the court, the highest court dealing with whether it's constitutional or unconstitutional.  So it's very different. MR. SNYDER:  Another difference that people have pointed to as they've tried to compare these cases is the issue of the offense and what is involved there.  And I think that a lot of people, when they make that comparison, they tend to focus on President Clinton's as being, in a way, a more personal matter and definitely not coming up to a particular standard.  You have the same debate, actually, with regard to President Roh, but the nature of the offense in certain cases is different, at least with regard to the violation of the election law and possibly the question of finance.  This issue of economic management, I think, that charge is quite similar in many respects. Let me just add one thing about the election law issue and that is that, you know, I think that what people recognize is that these laws in effect are part of what needs to be reformed.  Because the election laws in Korea are made to be broken, in the sense that they're so restrictive that it's really quite impossible to imagine that anyone can abide by them and therefore it opens up to the possibility of using those laws for political purposes. QUESTION:  My name is [inaudible].  I'm a Korean journalist.  I would like to ask Dr. Noland, your concerned with Korea's nationalist populism.  I think it seems to me that maybe the Roh government does not accept your labeling of his government as a populist government or national populism.  So what aspect do you think in the Roh government policy or activity could be labeled as populism?  Thank you. DR. NOLAND:  That's a good question.  And I want to clarify something, because I think the presumption of the question is inaccurate.  I did not mean to say that I regarded the Roh government as populist.  What I said was I see the emergence of increasing populist politics in Korea as a worry.  And what I meant was--the best examples were actually given by Scott, the use of mass demonstrations, candlelight vigils and so as basically a way of arguing out politics.  So that's what I meant, and I wouldn't expect President Roh to accept a description of being populist. One other thing I'd like add, which really goes back to Joe [inaudible]'s question about how this could play out is that the South Korean electorate has always struck me as a very demanding electorate.  They expect a lot out of their government.  A lot of things in the course of daily lives which Americans would sort of just regard as kind of, you know, this is the way the world works, it's not necessarily the responsibility of the state to take care of this or to fix this or to deal with this, South Koreans seem to regard the government as being responsible for sort of managing and fixing a kind of wider range of problems. And I think it's important to keep in mind that we're now on the second iteration, essentially, of President Roh going from high popularity to low popularity and then basically engaging in kind of a wild sort of political tactic--mobilizing support, having his popularity go back up.  But the thing is, if you don't deliver competency in government, that popularity is going to go right back down. So I would not have framed the answer in terms of him having leftist advisors or non-mainstream advisors, but I would actually frame it in terms of having competent advisors--and I don't care if you're left or you're right or whatever:  If you're not governing in a competent manner--and I'm most familiar with the economics sphere--performance is going to suffer; and this is a very demanding electorate and I don't think they're going to support you regardless of what label you pin to yourself. QUESTION:  [Inaudible.]  This question is for Marcus.  I came in the middle of your talk, so my question may be not quite right.  You just said that South Korea [inaudible] among the U.S., E.U., Japan, and China, so I think you mean the economy in terms of exports.  And somewhere you said it depends on the demands of China and the U.S.  So my question is this, based on my understanding of what you mean.  What are the South Korean exports to those four countries in terms of the percentage?  And also, what do you mean, that between--you only mentioned China and the U.S.?  Thank you. QUESTION:  Nick, this is a comment, not a question, but an answer to, or an input to your question about compare and contrast the Korean impeachment versus the U.S. impeachment of President Clinton.  I would note the rather obvious fact that, in our system, when President Clinton was impeached, he was not stripped of his powers.  In Korea, the president has been stripped.  And one of the under-reported and possibly under-appreciated aspects of this whole saga seems to me the performance of the prime minister/acting president, who has been received as the commander in chief of the military, he has accepted the credentials of foreign ambassadors, he's made presidential appointments, and he's vetoed a bill--which is a huge success story in the further democratization and the implanting of constitutional procedures in the ROK, it seems to me. QUESTION:  David Cho [ph] from the Brookings Institution.  Dr. Noland, you said earlier that crises in South Korea in the past have led to reforms.  And I'm wondering if any of you have any ideas as to what type of reforms we could expect.  And in addition to that, are there any mechanisms or tools that the legislative and political bodies in South Korea--can they use any of those tools to find out a way to protect the rights of the minority while projecting the will of the majority? MR. EBERSTADT:  Are there any other questions that anyone would like to raise?  Speak now or forever hold your peace. I'd like to ask our panelists for some final reactions and comments, either to the questions or other issues that may be on their minds.  After that, I have a question I'd like to ask each one of them. DR. LEE:  You know, we talked a lot about ideological cleavages.  But, yes, it's true, our society has moved to the left a little bit.  But if you look at the whole spectrum of left and right, I think it's still, compared to other European countries, even to Japan, Japan is--they have a communist party and socialist party; in our case, we have a democratic labor party, a very minor one.  Still, the ideological spectrum tends to be narrower.  Then why make such a fuss about this ideological spread? I think there is--the biggest fault line must be North Korean policy.  It's not like big government or welfare government versus pro-business.  There are some, but not that big.  It's not the major economics [?] we're trying. Okay, so maybe the North Korean issue.  So it's my feeling that all this ideological confrontation has been generated because of this power game of politicians and power elites.  Because unfortunately, we have like a game of winner-take-all.  If we could have shared some power, this kind of political war wouldn't be that nasty.  So I think it's a fort for our elites, because they are competing so deadly to get the important [inaudible] jobs.  And after they lose their jobs--look at our history--all these democratically elected presidents, Kim Young-sam and Kim Dae Jung, they send their sons to jail.  It's a very ugly story. So we have to restrain power when they are in power, and respect the minority and tend to share the power. DR. NOLAND:  On the question about South Korea's role in the global economy, the point I'm simply making is most of South Korea's growth today is coming from net exports.  The number one and number two destinations are China and the United States.  The products they export are primarily electronics, automobiles, and so on.  But the point is simply a very simple one, which is that South Korea has to continually change.  It can't compete against China on the basis of low wages--or at least I don't think it wants to, and it can't compete against the United States or Japan on the level of the foremost technology.  So South Korea continually has to find productive niches. On the question about crises and how one might respond, the difference between the situation now and the situation in 1997-98 was that was an external financial crisis that led to a bunch of changes in economic policy.  This is an internal political crisis.  One hopes that it leads to political reform.  If you're simply asking me what are some things that a strengthened government could do to push forward a reform agenda, there are all sorts of reforms in the area of corporate governance which are on the agenda--in some cases, the legislation is sitting there stalled in the National Assembly--and a strengthened government can move on this. If you ask me at the end of my wish list what I would like to see in terms of reform but I don't actually expect, at the top of my list would be regularizing the relationship with North Korea.  By this I mean moving away from the extreme levels of administrative discretion which gave rise to illegal payments, half a billion dollars going up North, and so on, and putting that relationship on a more regular and legalized basis.  It could in fact involve continuing to give subsidies to the North--that's a different discussion--but to do it in a way that is more transparent.  Unfortunately, I don't think that reform is actually on the agenda. MR. SNYDER:  I don't know if this is in response to any particular comment, but I just would, you know, feel that, as I've thought about this discussion, that especially from the point of view of an external observer, Korean politics, especially the situation at this moment, is overwhelmingly self-absorbed, almost without regard to the external context.  And one wonders whether there are not costs to being so self-absorbed. On the other hand, I think it is important to try to get the system right and to make sure that it's working in an efficient way.  And so in that respect, it seems to me that, you know, the real target of opportunity and perhaps the most urgent reform that we can see as part of this is the need to make the relationship between business and government, and in particular the money trail as it relates to politics, much more transparent so as to ensure that there's a fair opportunity for access and a level playing field for all constituents. MR. EBERSTADT:  Before we conclude, I can't resist the temptation to press our panelists to become handicappers for a moment.  What do our panelists see as the odds that President Roh will eventually be removed by the Constitutional Court?  I'll start the game.  I think that the odds of his being removed by the Constitutional Court eventually are about 4-to-1 against. MR. SNYDER:  This is the Eberstadt group, huh?  I would say 3-to-1 against. DR. NOLAND:  That's interesting.  I would say about 9 or 10-to-1 against. DR. LEE:  Fifty one percent for President Roh to stay in the presidency and 49 percent no, from the court.  Because I trust the court will deliver this issue more purely as a legality issue rather than a political issue and public pressure. MR. EBERSTADT:  Well, panelists all, thank you very much for an enjoyable and informative session.  Please join me in thanking our panelists. [Applause.]</body></html>