In all this, Korean politics has clearly learned all the wrong lessons from the American example. Korea has, in effect, done what the U.S. is also doing by bringing in the ongoing pension debate to the budget decision. As an economics professor from Korea University recently stated, “The political risk that the opposing parties are taking by refusing to compromise could greatly detract Korea’s financial integrity at a time when its economic recovery still seems far off and hopeful at best.” If there is a lesson this country needs to learn right now, take a look across the Pacific.
The latest developments in the United States (U.S.) turned the world’s attention to the American government, which began its indefinite period of partial shutdown on October 1. The shutdown, which is taking place for the first time since December 1995, immediately resulted in over 800,000 federal workers being put on furlough, national parks and museums closing down, and other governmental functions being put on hold. All of the commotion is a result of the failure between the Democrat-majority Senate and the Republican-majority House of Representatives to agree on a budget plan for the new fiscal year. The Republicans, led by House Representative Mark Meadows, are pushing for a delay or repeal of the Patient Protection and Affordable Care Act, commonly referred to as “Obamacare.” The House passed amendments that oppose the ACA statute, which the Democrats promptly rejected in defense of Obama’s major domestic policy. So far, the shutdown has mainly affected the United States only, but this childish standoff between American politicians “holding guns to each other’s heads” is threatening the welfare of not only their own citizens, but the rest of the world as well.
The most immediate consequences of the government shutdown are those affecting the U.S. itself. While the sizable number of furloughed federal workers may find themselves and their families in difficult positions, social security payments may also be affected, meaning people’s immediate livelihoods could be at risk. Additionally, over 300 national park service sites have now been closed, passport processing has come to a halt, and even garbage collecting is suspended in certain areas. U.S. politicians have single-handedly worsened the lives of their own countrymen by failing to reach a consensus over an issue of national healthcare. Critics have spoken out on how this crisis – an apparent influence of the minority hindering the will of the majority – is an affront to the democratic process and only a short way from questioning the politicians’ intentions and integrity.
From a global perspective, the shutdown’s expected ramifications on the international economy are even more frightening. The U.S. dollar, which serves as the international standard currency, has already seen a drop. America is the biggest global market, and in Korea’s case, a significant percentage of its exports are made to the U.S. With such heavy dependency on the health of the American market, the Korean economy along with the economies of virtually every other nation will be shaken up by American irresponsibility. The financial crisis of 2008, brought on by the U.S. housing bubble burst, could be repeated as a follow-up of the shutdown. Another aspect to consider is the imminent deadline for raising the debt ceiling – the shutdown could influence the ongoing debate on raising the U.S. debt ceiling and as a result, the government could potentially default on its significant debts. Should the U.S, choose to default, the fallout from that decision would be a major blow to the global economy, which is still struggling to overcome last decade’s recession; the world is, simply put, a hostage to American squabbling over domestic issues.
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