The ‘fair society' motto has been the centerpiece in the second half of the Lee Administration.

-Gi-Wook Shin, director of Shorenstein APARC and KSP

On August 8, 2010, South Korean President Lee Myung-bak put into place the largest cabinet reorganization since he took office, nominating 48 year-old Kim Tae-ho as prime minister. However, after only 21 days, failing to pass a confirmation hearing of Parliament, Kim Tae-ho took the initiative to declare his resignation while waiting for Parliament to take action following the vote on his prime minister nomination. South Korea's prime minister [post] is without any real power; however, with a high parliamentary status, it is also in reality an important auxiliary to the president. Now into the second half of Lee Myung-bak's term, confronted with the dilemma of needing to identify a prime minister for a fourth time, one cannot help but raise the question: what is going on with South Korean politics?

The ruling Grand National Party hoped to pariah Kim Tae-ho, who in the prime of life, would have been able to give Li Myung-bak's government an infusion of "reform," "communication," and a "fresh" approach, but the opposition party also questioned Kim Tae-ho's political qualifications. From August 24-25, when the Parliament confirmation hearings convened, the Democratic Party also threw in several heavy accusations-Kim Tae-hoe's receiving bribes and illegal loans to raise campaign funds, having a public bus for his personal use, ordering full-time civil servants to do housework, and his wife accepting bribes and improperly managed properties-and strongly opposed Kim Tae-ho as Prime Minister. Gi-Wook Shin, director of Stanford University's Shorenstein Asia-Pacific Research Center, says: "These allegations are not new. Though the prosecution has cleared Kim of bribery charges, I think the fact that he lied about his ties with Park Yeon-cha, a convicted businessman at the center of a high-profile bribery scandal, was the last straw. A photo also surfaced after the hearing showing Kim standing next to Park at a date several months earlier than Kim testified to having made his first acquaintance with Park." Park Yeon-cha is the former chairman of Taekwang Industrial. By the end of 2008's "Park Yeon-cha Gate" [scandal], numerous South Korean political figures were involved in the bribery scandal,  and former President Roh Moo-hyun also committed suicide.

"Kim Tae-ho's ambiguous statements have also left the ruling party and the public feeling disappointed. Kim Tae-ho was not widely known outside of his South Gyeongsang Province office. President Li Myung-bak praised him to South Korean society for being young, for having strength and charisma, and for being an honest, reliable politician. Now voters naturally are questioning his integrity and this has become a barrier for Lee Myung-bak's administration," says Dr. Insung Lee, director of Yonsei University's East Asia International Studies Institute.

Kim Tae-ho believes there are some accusations that are not very fair. Dr. Shin suggests: "What Kim meant by "unfair" was the fact that his confirmation hearing focused in large part on making personal attacks on Kim, and throwing harsh criticism of the ruling party, rather than serving its purpose to prove he was unqualified for the PM position." This no doubt exposed the intense power struggle between South Korea's political factions, and even differences within the Grand National Party.

"Lee Myung-bak should not introduce the subject of Kim Tae-ho when talking about matters of the next presidential election," says Dr. Lee. In 2004, Kim was elected governor of South Gyeongsang Province, becoming the youngest governor. During the time that he was the provincial governor, he actively promoted the "South Coast Sunbelt" development plan as a national project. Through word of mouth, he easily won the 2008 local government re-elections. According to the Constitution, Lee Myung-bak is unable to run for president again. Because of this, public opinion holds that he had the intention to train Kim Tae-hoe for the 2012 presidential candidacy. "The opposition party members at the hearing increasingly attacked Kim Tae-ho, in part to prevent this kind of arrangement from taking place," says Dr. Lee.

Dr. Chung-In Moon, professor of political science at Yonsei University pointed out: "People believe that Lee Myung-bak selected Kim Tai-ho to compete in the 2012 general election against in-party rival Park Geun-hye. Since this card is obsolete, Lee Myung-bak now cannot help but stand with Park Geun-hye. I cannot decide for certain how long this will last-the Lee camp will certainly find their own candidate." The internal struggle between the Grand National Party's inner factions was exposed in the battle of the recent Sejong City construction plan amendment. Park Geun-hye, the daughter of the leading "Second Faction's" former president Park Chung-hee, publicly sang a different tune towards Lee Myung-bak, displaying a hope to follow up with the plan to promote the construction of Sejong City. At the time of Parliament's vote, 50 of the ruling party's 168 members voted against the pro-Park opposition party. After former Prime Minister Chung Un-chan announced he would resign, Park Geun-hye raised the issue, holding Lee Myung-bak to be the primary lead of the Sejong City amendment and the one who should bear the responsibility.

On the day that Kim Tae-ho made his declaration to resign the prime minister nomination, those nominated to be the Minister of Culture, Sports, and Tourism and Minister of Education and Economics, also took the initiative to resign because of the suspicion of having accepted bribes. After several days, Foreign Minister Yu Myung-hwan was also forced to resign due to the incident of his daughter's receiving "special admission" to become a senior civil servant. President Lee Myung-bak expressed: "I accept their resignation. I believe this will lead to the starting point of a fair society." Dr. Gi-Wook Shin believes: "The 'fair society' motto has been the centerpiece in the second half of the Lee Administration. As President Lee said in his liberation day speech in August 2010, 'A fair society is where each individual has to take responsibility for the outcome of his or her undertakings . . . A fair society constitutes the ethical and practical infrastructure for the advancement of the Republic.' To this effect, Lee reportedly instructed his secretariat to toughen the screening of ethical backgrounds of candidates for top government posts. Putting emphasis on higher ethical and moral standards can be seen as a positive sign of Korea's democratic advancement. It is not the only measure, but it is also an important measure for the betterment of South Korean politics."    

Translation by Sarah Lin Bhatia

 

 

 

Nigeria’s national oil company NNPC is at the center of a profoundly dysfunctional oil sector in a country that some argue embodies the “resource curse.” In a new study, PESD Associate Director Mark C. Thurber and PESD affiliated researchers Ifeyinwa Emelife and Patrick Heller find that NNPC’s persistent underperformance stems from its role as the linchpin of a sophisticated and durable system of patronage.

Abstract

Nigeria depends heavily on oil and gas, with hydrocarbon activities providing around 65 percent of total government revenue and 95 percent of export revenues.  While Nigeria supplies some LNG to world markets and is starting to export a small amount of gas to Ghana via pipeline, the great majority of the country's hydrocarbon earnings come from oil.  In 2008, Nigeria was the 5^th largest oil exporter and 10^th largest holder of proved oil reserves in the world according to the U.S. Energy Information Administration.  The country's national oil company NNPC (Nigerian National Petroleum Corporation) sits at the nexus between the many interests in Nigeria that seek a stake in the country's oil riches, the government, and the private companies that actually operate the vast majority of oil and gas projects.

Through its many divisions and subsidiaries, NNPC serves as an oil sector regulator, a buyer and seller of oil and petroleum products, a technical operator of hydrocarbon activities on a limited basis, and a service provider to the Nigerian oil sector.  With isolated exceptions, NNPC is not very effective at performing its various oil sector jobs.  It is neither a competent oil company nor an efficient regulator for the sector.   Managers of NNPC's constituent units, lacking the ability to reliably fund themselves, are robbed of business autonomy and the chance to develop capability.  There are few incentives for NNPC employees to be entrepreneurial for the company's benefit and many incentives for private action and corruption.  It is no accident that NNPC operations are disproportionately concentrated on oil marketing and downstream functions, which offer the best opportunities for private benefit.  The few parts of NNPC that actually add value, like engineering design subsidiary NETCO, tend to be removed from large financial flows and the patronage opportunities they bring. 

Although NNPC performs poorly as an instrument for maximizing long-term oil revenue for the state, it actually functions well as an instrument of patronage, which helps to explain its durability.  Each additional transaction generated by its profuse bureaucracy provides an opportunity for well-connected individuals to profit by being the gatekeepers whose approval must be secured, especially in contracting processes.  NNPC's role as distributor of licenses for export of crude oil and import of refined products also helps make it a locus for patronage activities.  Corruption, bureaucracy, and non-market pricing regimes for oil sales all reinforce each other in a dysfunctional equilibrium that has proved difficult to dislodge despite repeated efforts at oil sector reform.

An Afghan legal education project led by CDDRL affiliated faculty Erik Jensen, co-director of Stanford Law School's Rule of Law Program, and former Stanford law students Alexander Benard and Eli Sugerman has won adherents among Afghan students eager to learn the country's new laws and top Afghan officials, including the chief justice of the Supreme Court. The group's three online text books, with a fourth to be published this fall, have been so successful that the U.S. State Department has just awarded Stanford $1.3 million to continue the work.