“Beginning with a job revolution” (JoongAng Daily, November 4, 2014)

JoongAng Daily

November 4, 2014

 “Beginning with a job revolution”


Emanuel Pastreich




Forty years ago in Korea, a 22-year-old woman would, for the first time, put on makeup and try on expensive dresses as she prepared for marriage. But these days, young women spend an infinite amount of time and money dressing up for what seems like a life-altering event.

But it’s not for a wedding – in fact, many of them doubt they will ever marry and enjoy a family – rather it’s for an ineluctable rite of passage: the dreaded job interview.

That’s right. The stress and tension once associated with weddings now result from a short meeting with a complete stranger that is required for a potential job. And this ritual has only become more central in the lives of young people over the past three years as the economy grows worse. Cosmetic companies, plastic surgery clinics and clothiers make implicit reference to this rite in their advertisements. And the young and inexperienced latch on to this event as a promise of stability in an increasingly disorienting and uncertain world.

As a professor, I have watched the emergence of this cult with dismay. I see young men and women spending large amounts of money practicing for interviews, having professional photographs taken for their resumes and otherwise neglecting their classes and friends to prepare for a single moment, supposedly in which their futures will be determined by the most superficial of criteria. It seems as if the university can do nothing to help our graduates to thrive in the world other than to help them build up their experience with summer internships. A professor is not someone who can offer advice for a lifetime. Rather, we provide just a few required documents in the process.

Sadly, many students flood into graduate schools in the hope that continued studies will somehow afford them some certainty in their lives – even though graduate school cannot provide much in the way of benefits. Permanent positions for students with master’s and doctorate degrees are decreasing.

So the faculty sits by watching helplessly as our students are forced to remodel their lives to match the requirements of the dreaded interview. And yet, if we could think big for a change, if we could use our imagination, we could come up with a new approach to education and the future of our children.

Imagine if universities provided a job to students along with their diploma, rather than simply pushing them out into the cold world. Although at first glance such a proposal may seem unrealistic, if we rethink the nature of education, something similar may be possible.

The program could work something like this: Students entering university would be given a chance to create a venture company together with classmates who have similar or complementary interests in their first or second year of study. The university would help them create this company based upon their studies, their strengths and emerging business opportunities. The venture company started by the students would then permit the students, before graduation, to explore new concepts and consider new approaches to business, to manufacturing or to services.

Those interested in public service could form their own NGOs or other small organizations with their peers. Over the course of four years as an undergraduate, students would learn from their subjects, but also learn how to run the small venture company they created.

Come graduation, the students – whether in groups of three or 10 – would be launched into the world with both a diploma and a venture company to make their way and find their future. The venture company that they are a part of would be subject to strict demands from the university and from financing organizations, but those demands would be no more stressful than the demands made of graduates today, and more helpful to the students than ritual interviews.

There are two key shifts that must take place before such a plan is viable. The first is that Korea must have a policy to assess people’s careers on the basis of their skills and their experience. It is entirely logical that someone who has experience starting his or her own business should be highly evaluated for future employment regardless of the scale of the effort. We should not assume that the only road to success is through a big mainstream corporation.

The other change required is in financing itself. Many youth are deeply discouraged about their futures simply because they cannot find the means to realize their dreams. If banks were required to commit a significant part of their lending and financial assistance to people under the age of 30 (say, 30 or 40 percent), we could see a significant change in the mood among graduates. If they had an extremely good chance of receiving funding for their work and it was relatively easy to start a company for someone in his twenties, the entire nature of getting a job would change. You could essentially create your own job.

Such a move to create entrepreneurs on a massive scale among those under 30 is the best approach to revitalizing the Korean economy and bringing in new ideas and approaches on a massive scale. It is not the fault of professors that Korea is not producing the next Steve Jobs or Bill Gates in great numbers. That state is the result of the impossibility of youth realizing their ideas.

Moreover, I have heard many explanations for the factors behind the “Korean Miracle” of the 1970s and 1980s, but oddly the issue of age is rarely mentioned. When Park Chung Hee took office in 1961, he was 44; when Nam Duck-woo became finance minister in 1969, he was 45. They hired many far younger than themselves.

Shifting the entire process of developing business and financing opportunities down to those in their 20s and 30s would have a tremendous impact on Korea’s economy. It would also bring new hope to graduates, in which they could play a direct and significant role in society.




4 responses to ““Beginning with a job revolution” (JoongAng Daily, November 4, 2014)

  1. Craig November 4, 2014 at 11:42 am

    This is a novel idea. But it doesn’t address the larger problem.

    Smaller companies don’t pay well; it’s not that they don’t want to. They can’t.

    Most startups fail. This is why banks won’t finance them. Even in western countries , startups are insanely risky.

    Forcing banks to loan money does two things. First, it has the potential to destabilize banks . They’re not endless money pools. Failures will have to be back stopped by taxes, Which hurts people who can’t afford it. Second, it plunges students further into debt to finance extremely risky ventures.

    This all also requires massive government oversight, intervention and competence. Korean authorities have extremely low marks on all of these. My suspicion is that Korean government and the institutional cultures here are not competent to do this. There’s insufficient transparency, there’s too much collusion and corruption, and far too much top down interference to make this work.

    The problem is the way the koreZn economic order arrived at its current position. It leveraged gov backed loans and preferential treatment to create a ruling class that operated government – entitled private monopolies, tasked to develop in exchange for nearly absolute power. This worked so long as they had a captive domestic market that shut out imports and bared foreign competition, while being given preferential access to lucrative foreign markets due to the Cold War. The model was based in the only surviving social institution after 1953: the South Korean army. This was modeled on the Japanese army.

    Today, we have sclerotic , authoritarian, inefficient bureaucracies masquerading as private corporate bodies, which lurch very well but are not particularly adaptable.

    It a deal with the devil, Korea got development, but the seeds of decay were planted decades ago. From government collusion, monopolies, regulation designed to protect stakeholders rather than level the playing field, etc., we get this.

    Cresting anything to do with government working with banks is a recipe for disaster: even if it works, it will bleed into the current influence networks, and anyway but don’t work. Administrative lethargy and incompetence, the “not my problem” irresponsibility of Korean institutions and the reliance on meaningless certifications and status will render such a plan inoperable. That’s before we get to institutional incompetence.

    If we want to spur startups, we need to go a few steps deeper and further.

    1) make angel investors aware and create independent funding sources. Independently managed pools of investment income, tasked with investing locally and drawing on depositors , can be set up. Investor pools, with risk spread around. Create new ones. Old ones come with crappy management cultures.

    Create support centres. These offer scaled assistance to startups.

    End the obsession with respect for age. This is a massively crippling cultural barrier in Korea. You can’t ignore this: it has to be tackled directly and aggressively. That barrier has to be forcibly smashed. It can’t be done with a scalpel. You need a hammer, and it has to be brutal and public. Youll end up with a core group of cultural holdouts and a new group of startup that defy old cultural norms. That will stir the pot.

    Resistance: the dominant players have multiple ways to shut down change. They can sue, close down options by restrictive contracts, prop up money losing competitors, and the unethical but standard methods: get government to regulate competition out; steal ideas and patents; get government to rewrite rules; and purchase competitors.

    The root of the problem is the power of government and its collusion with business. It’s not market capitalism: it’s managed oligopoly. Both the Korean right and left are addicted to this; the only difference is that they envisage doing something different with that power,

    You typified the problem with your suggestion. You would create more government – business action by fiat. Just “order” it to happen.

    It’s symptomatic if the disease.

    To create a revolution in business for young people, we need to shatter the regulatory power if government. We need to stop Samsung from being able to shut down competition. We need to lock corporate interests out of government. We can’t replace one fist with another, and given this country’s model, we can’t trust government to play fairly. So the only sure wY is to prevent the government from having the power to interfere. Tinkering is useless.

    One thing that has to happen that allKoreans fear is opening up the market. Right and left, there’s general agreement that nobody else should get koreZn money.


    Throw borders open to foreign retail. This would undermine the collusive koreZn retail monopolies.

    Stop import duties. Let Amazon do business here, openly, and facilitate it. Hurt local monopolies.

    Remove administrative hurdles that lock out retail Startups. If rules are too complex, say, to import beer, only large chaebols can do it. Let’s have a hundred new small companies importing stuff.

    The point is: stop managing.

    Every one of koreas problems stems from management of the economy. It’s ludicrously easy to commandeer levers of power. If we want startups to do bold, brash things and bit die immediately, we need to stop seeing business as done kind of “national project” and start seeing it as countless independent actors who should not be favoured or hindered by government, no matter how worthy.

    You can set the stage by doing thing like:

    Stop barring foreign companies from coming in. Ueber, for example, is under assault in Seoul. A big reason is that old style managers don’t want money going to foreign companies. That’s not how it works. If you want to have a free economy that can generate ideas and startups and use youthful energy, you need… A free economy. Stop pretending its a national project that needs protection from evil foreign wolves.

    Startups can’t operate In A society obsessed with social control, intense management and constant evaluation by humane experts. Startups need to avoid red tape, break old ideas and shape new trends. This means doing end runs around bureacracy, social control, government interference and corporate domination. You need to enable mavericks to smash glass. It’s not orderly and requires giving up power.

    Can this be sold to Korean people? The management class? Their government clients?

    Your suggestion would be the beginning of a good dialogue if you were also assaulting the primary cultural and institutional obstacles that cripple innovation in Korea. Without that, it’s just another clone of top down managed boondoggles that will achieve perversely opposite effects.

    Want startups?

    Set Korean genius free.

  2. Craig November 4, 2014 at 1:23 pm

    Apologies for the typos. Writing in an iphone while on the subway.

  3. Emanuel Pastreich November 4, 2014 at 1:35 pm

    Craig, I am always deeply thankful for your comments. I would only comment that the purpose of this article was to stimulate debate about what needs to be done and to suggest a global change, as opposed to a piecemeal one. What would actually work is a more difficult question. But perhaps we can at least start to make it easier for youth to start their own companies and get financing. At least better than financing speculation.

    • Craig November 4, 2014 at 2:09 pm

      I agree, we should make it easier. But the case suggestsmore that, especially in Korea, the problem is more or less the State. It’s the principal barrier. Corporations sit on Korea, but the State assists them.

      The problem is that the model that created Korea Inc. specifically locks out “startups” by design. Every aspect of it is designed to prevent it from happening.

      The central issue is state-level control. EVerything about Korea is about social control, top-down management. No management strategy will generate a culture that innovates and in which startups can flourish. This is why Silicon Valley is so resistant to interference. It’s why tech is generally chaotic and resists government intervention. The more oversight you provide, the more collusion and the less innovation you have. As soon as the government and Microsoft started to talk, the worse the operating system market got. Even when the government tried to break up what it saw a a monopoly, regardless of what it did, it ended up reinforcing it. It’s perverse, and counter-logical, but true. Same was true in Canada. The govenrment wanted more competition in banking, so it tried to prevent mergers by managing the system; instead, it ended up entrenching a few players. Nothing it did could dislodge them.

      The best thing to do is step back and let companies like Doosan or even Samsung take massive losses and suffer; let new companies take up the slack. The government needs to open up markets.

      Example: Web services and the internet.

      The government, obsessed with social control, actively prevents innovation. Whether it’s online banking security regulation (which locked Korean users into using one version of Windows and one version of Active X if they ever wanted to do internet banking for a decade), or rules regarding website registrations (no anonymity – ID card registration requirements to allow the government to identify critics – used by Lee MyunBak and President Park to harass detractors and bloggers, or retail rules blocking new services in favour of established ones, or competition rules that weirdly prevent competition–

      whether it’s this or that policy, the best thing the government in Korea could do to foster startups would be to essentially abandon Project Korea. The idea that the Korean economy is reliant on its chaebols (it is, as currently structured) depends on the idea that it’s a National Economy Inc. – somethign managed by elites for the benefit of “the nation”. But what is “the nation” but its people? Is it some abstract idea independent of them? The people are individuals, and their strength is the strength of the nation.

      We may admire the collective spirit of this kind of “Asian model” of “authoritarian capitalism”, and some of may admire its ability to deliver wealth while protecting the wealthy/educated elite/political class (both left and right love this aspect of it), but the dangers I’ve mentioned above are just the beginning of the problems associated with this model.

      Weirdly, China escapes some of this (not all, but some). The law is so restrictive and penalizes independent action far more directly. But its very corruption actually allows for independent action- if you can bribe your way out of the rules or ignore them because enforcement is lax or arbitrary. Weirdly, that kind of “wild East” scenario allows for far more innovation. Of course, because it does this by deligitimizing the government entirely, it also fosters more negative innovation – poisonous food, poisonous or fake medicine, flagrant copies and patent violations, market excesses, etc. These things could be minimized were the government to set out fair rules, free of rampant corruption, in which consumers had freedom of information to act in their own best interests. Cheating or shoddy players would be drummed out of the market.

      This is not a recipe for laissez-faire capitalism, it’s just pointing out that innovation requires free thinkers and actors, and the urge to control or manage is in every way antithetical to this process. Korea doesn’t innovate because almost every aspect of its educational and economic system is specifically designed to prevent freedom of action. it’s designed to be a managed system.

      Innovation is death to a managed system. It’s obvious that this has a parallel: North Korea. In reality, the only real difference between the two societies’ original approach was that the North Korean model enforced government – owned monopolies, making all people serfs in the employ of the state, for nationalist goals. South Korea created a managed private economy in the service of a state-sponsored ultra-elite, who are in turn serviced by client agents within the government. It’s still a managed system, designed to serve “the National Project” of Korea.

      In a way, both North and South Korea are model models for managed states. This was also true of the (mis)managed Choson state. Such management models always fail. Korea’s success was due to starting from such a low bar, specific political circumstances, and being freed of historical baggage by having had its traditional elite exterminated by the Japanese. Ironically, the Japanese wiped the slate clean, allowing Korea to reinvent itself almost from whole cloth. Their principal crime was South Korea’s principal advantage. Taiwan, for example, did not have this advantage. In many ways, it represents a truer example of traditional Chinese culture than any part of China does. While legally and politically much freer than China, children were still being sold to strangers in the 1960’s-70’s and the ruling class is notoriously conservative.

      Korea is not innovative because the culture is predesigned to prevent it. But modern Korean youth are connected to global cultures. They can move in international circles with relative ease. There’s a huge class of internationally educated, broad-minded and ambitious people in Korea, able to compete anywhere in any field. None of these people are able to take positions of power in Korea. But they could start out on their own – on the condition that the Korean state would remove its objections and stop trying to manage them and their lives and their activities.

      If any country in the world calls out for a free-market approach, and by this I don’t mean Park Geunhe’s version of Chaebol free-marketism, that country is Korea. It needs less oversight.

      Cut people loose. Cut young people loose. Let them live or die by their gifts and talents. Stop shoehorning people. Don’t create huge programs to identify and rank talent and then fund it in Creativity Institutes. That’s the central problem with the approach.

      Let clever and creative people do it. While some fringes could be tapped – investment funds that throw money at startups would be nice, perhaps assisted by changing banking rules without ruling by fiat – the best idea is very simple.

      The Korean people are just as smart if not smarter than people anywhere. All the government (and society) needs to do is stop stopping them.

      Embrace a little “chaos”.

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