Fiscal Thriftiness Needed 'Super Budget' Should Not Turn Into 'Super Debt' The size of the supplementary budget to stimulate the moribund economy has - in no time at all - increased by leaps and bounds. Only half a month ago, the government's budgeters talked about extra spending of 10 trillion won ($6.5 billion), but the amount has since snowballed to 20 trillion won and further to 30 trillion won before anyone realized it. Some officials of the governing Grand National Party (GNP) are even citing a private report, which calls for an extra budget of a hefty 50.7 trillion won to attain 2.9-percent economic growth. Hardly heard are discussions on how to use this additional budget - how much money to allocate to which sector - to maximaize its effect. This fiscal equivalent of putting the cart before the horse is a disturbing reminder of how lightly these elected and appointed officials regard taxpayers' money. Some GNP lawmakers say Korea's government debt is still at a relatively low level, accounting for 33 percent of its gross domestic product (GDP), noting an additional 3 percentage points or so will not matter that much. These are not the remarks to be made by an official living on and managing state finance with taxpayers' money. When debts by state enterprises and other public sectors are included, the comparable ratio jumps to about 70 percent, the average level of the 30-member Organization for Economic Cooperation and Development (OECD). More fundamentally problematic is the governing camp's habit of using the extra budget as some sort of supplementary means of economic stimulus Rep. Lee Hahn doo, a former chief policymaker of the GNP, hit the nail on the head, saying, "The extra budget is like kindling, but the government is trying to use it as firewood." But even the 30 trillion-won supplementary budget would have been more affordable, had the government not introduced tax cuts for wealthy property holders, which eroded revenue by 13.5 trillion won last year, and is expected to curtail it by an additional 20 trillion won this year. The revenue loss will have to be filled by all taxpayers, including wage earners who don't even have their own homes. No less serious is where to spend the money. At least 16 trillion won of the budget will be invested to refurbish four maor revers and build a canal between Seoul and Incheon over the next few years. Pohang in North Gyeongsang Province - the home of President Lee Myung-bak and his elder brother, Rep. Lee Sang-deuk, saw an increase of 100 billion won in its social infrastructure budget, the biggest for all precincts - in a typical example of earmaked outlays for powerful politicians. Pouring a massive amount of money into large public works can umpstart the economy, but its effects are short-lived, leaving only lasting debts - and lots of white elephants - as has showcased by Japan's lost decade. Instead, the government should spend the money on improving economic fundamentals by creating new growth engines and rectifying income polarization. It ought to furher enhance mainstay industries and promote new, future-oriented ones while weaving its social safety net with finer mesh. In a worst-case scenario, the government could end up giving only narcotics to a patient with a sirious illness, while avoiding the painful but vital operation of economic reforms. Such concerns are growing further, as the ongoing recession will likely prove to be far deeper and longer than many had expected.