Seoul: President Lee Jae Myung highlighted the urgent need for the government to restructure the unpayable debts of small business owners and individuals to facilitate recovery from the economic impacts of the COVID-19 pandemic. Speaking at a town-hall style meeting, Lee emphasized the state's duty to support those burdened by debt, particularly small merchants and the self-employed who faced financial challenges due to stringent business restrictions during the pandemic.
According to Yonhap News Agency, President Lee underscored the social undesirability of perpetual debt, noting, "In our society, once you fall into debt, you are chased by it until death." He advocated for a swift resolution of unpayable debts, drawing parallels with practices in advanced countries. He further explained that like clearing old stubble to allow new growth, debts should be swiftly written off and settled to foster economic revival.
Lee proposed a "reformist approach" to financial policy, suggesting that there is significant potential for policy adjustment. He addressed public skepticism regarding debt write-offs, stating that a broader understanding of the government's role in crisis management could ease the path to debt restructuring.
President Lee criticized the shift of pandemic-related economic burdens onto individuals, contrasting it with other nations that increased national debt to manage the crisis. He highlighted the unfairness of individuals bearing the brunt of government-imposed business restrictions during the pandemic, asserting that the government should assume financial responsibility for these circumstances.
In addressing concerns about potential moral hazard from debt restructuring, Lee argued against stigmatizing indebted individuals as delinquent borrowers. He warned that such labeling could exacerbate economic challenges, advocating instead for supportive measures that recognize the extraordinary circumstances faced by small business owners during the pandemic.