[Editorial] Hypocritical nominee
Moon’s pick for SMEs and Startups minister has moral flaw of double standard
By Korea HeraldPublished : Nov. 2, 2017 - 17:31
Hong Jong-haak, President Moon Jae-in’s nominee for minister of SMEs and Startups, has run into a lot of flak for being unconscionable and hypocritical.
Two years ago, his spouse and daughter were each gifted a 25 percent stake in a commercial building owned by his mother-in-law. Dividing property stake before giving it to children is an effective way to reduce tax payments.
His daughter, now 13 years old, made a deal with her mother to borrow 220 million won ($198,000) from her to pay the related gift tax.
His daughter reportedly paid her mother interest on the loan using rent received from building tenants. This is a money transaction within a family that tries to deceive the public through transparent guile.
Hong’s family assets swelled by nearly 3.4 billion won from 2.1 billion won in 2012 to 5.57 billion won this year, largely owing to his mother-in-law handing down part of her wealth to Hong, his wife and his daughter.
That is the passing down of wealth that Hong himself has criticized for discouraging common people from working hard and fostering an atmosphere of social disharmony between classes.
As a lawmaker of the 19th National Assembly, Hong proposed a revised bill to raise gift and inheritance taxes for large wealth transfers from parents to children or from grandparents to grandchildren.
The nominee argued for the shutdown of all private elite high schools, but his daughter attends an international middle school that boasts a high rate of graduates’ entrance to such high schools.
Furthermore, the annual tuition fee of the middle school can amount to 15 million won, while public middle school education in Korea is free, barring the cost of uniforms.
When working as a senior policy adviser for the Moon campaign, he was critical of expensive elite education. In view of his criticisms, he deserves criticism for his daughter attending such a school.
In a book he wrote as a university professor, Hong advised students to go on to Seoul National University and other top-tier universities even if they must study one or two more years after graduating from high school. He dismissed those who failed to enter prestigious universities as being unrefined, and later apologized as criticism mounted.
The presidential office stands fast by Hong. A senior Cheong Wa Dae official said recently, “The nomination of Hong may become problematic if illegal acts were to be found, but no such acts have been found.”
The official went on to say, “The National Tax Service provides information on its website about the division and transfer of wealth as a way to reduce taxes. It is common sense to borrow money and then repay the debt with rent. However, the news media are trying to describe him as morally wrong.”
Of course, his way of handling his family assets is legal, as Cheong Wa Dae has noted.
That is not an issue, though. The problem is that it is immoral and unconscionable of him to do without compunction what he criticized others of doing.
Even if it is no big deal for his teenage daughter to be given wealth by her maternal grandmother, the relationship in which her mother lends money to her and she redeems debt with rent can hardly be called common sense.
The Cheong Wa Dae official reportedly asked reporters, “Wouldn’t you accept property if your mother-in-law gave it to you?” The official was haughty and shameless.
The point of Hong’s issue is his hypocrisy and immorality, not whether he violated the law or not. He is required to meet a higher standard than ordinary people because he will work in the top position of the ministry. That his actions belie his words is one of the most serious moral flaws for a minister nominee.
Hong is far from the fairness and justice that President Moon has championed.
Moon must rethink his nomination.
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Articles by Korea Herald