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Using faith to secure prosperity

How the Church can help the poor find lost wealth

Using faith to secure prosperity
Joseph Pak, Seoul

January 9, 2013

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Many of us may know the famous fable of the Ant and the Grasshopper. In that story an ant works hard during the summer to save enough food for the coming winter, while the grasshopper idles away the summer days and starves when the season turns. In one respect South Koreans still work like ants. According to the Organization for Economic Cooperation and Development, in 2011 South Koreans worked the second longest among the 34 membership countries.

But in another respect they are not ants, since they do not save what they earn.

According to a report from the Korea Institute of Finance published on December 30 last year, South Koreans' savings-to-disposable personal income ratio in 2011 was just 2.7 percent. This means they spent 97.3 percent of their income and saved only 2.7 percent.

Korea’s savings rate peaked at 24.7 percent in 1988 and has gradually decreased since that time.

What have savings to do with the Church? Are they not more relevant to banks and government?

In the recent years of world economic crises, many fiscal behaviors have shed light on the huge debt of some 1,000 trillion won (US$940 billion) that Korean families owe to banks.

And it is one of the most urgent tasks that the new president-elect Park Geun-hye, who will start her five-year term in February, must address.

She will create a special fund of two trillion won to bail out the ‘house poor’, or those who spend a large proportion of their income on mortgage payments for their home.

However it is hard to imagine that the small fund can remedy the huge debt problem. And we must see the reality that a debt needs to be paid back and then the economy can grow again.

But with what money? Koreans worked like the ant but saved like the grasshopper, and now they don't have enough money to give to banks.

Fifteen years ago, it was different.

People rushed to banks with their gold, responding to the government's appeal that the gold in their home was the last thing for the then bankrupt Korea to sell to get foreign currency just after the IMF bailout in late 1997.

And the late Cardinal Stephen Kim Sou-hwan joined in the long line of such citizens in front of banks and shyly confessed to media that his gold was not his savings but presented by others, as he wanted to join the campaign.

My wife and I were among the 3.5 million citizens who gave 227 tons of gold, but I kept our wedding rings aside at home while so many couples lost their rings for good "to save the nation".

The report from the Korea Institute of Finance pointed out since 1998, Koreans don't have as much money because of fewer pay rises and an increase in inflation, as well as a growing gap between rich and poor.

And I would add one more reason: a lack of faith.

After giving gold to save the government and big businesses in difficulty, Koreans have witnessed that they were betrayed. The government and the revived big businesses including Samsung and Hyundai Motors turned away from the people who saved them, even accumulating huge cash reserves and being reluctant to increase employment, which they promised to do when they were thirsty for the people's assistance.

Confucius once said that there are three basics of food, national defense and trust to run a state, and trust is the most important. In other words, trust is more important than money and weapons to build a prosperous country.

And in this sense, there is a chance for the local Catholic Church to help the people without money and hope as well. Because it is an expert of building trust and faith.

It has proved it once already about 50 years ago when the whole country was so poor.

On May 1, 1960, the Maryknoll Sister Mary Gabriella Mulherin (1900-93) built the Holy Family Credit Union in Busan, as the first credit union in the country. And the next June, a Korean priest established the second one in Seoul.

Sr Mulherin was working for the war widowers from the Korean War (1950-53) and saw they were dependent on foreign aid, without any hope and faith for their future. Then she decided to help the Koreans to stand on their own feet by cultivating self-trust among them with the credit union.

And now the local credit unions, with a membership of 5.86 million, are ranked as the third biggest in the world in terms of asset volume, after the United States and Canada.

It is true that the credit banks helped many poor people in and out of the Church to raise their economic and social status.

At present almost all credit unions that were hatched in the Church compound have moved out, but still it is easy to find one near a Catholic church, which shows the Church's close ties with the community. It was one of the biggest contributions to the nation that the local Church has ever given.

But for years it has been hard to hear the local Catholic Church saying anything about the importance of saving. Rather it seems to have forgotten it as its components became relatively richer than other citizens and it became hard to see poor people in the Church.

And now is the time for the Church to help people restore their faith again in saving to protect themselves from the present economic difficulties. While the Church might not have money, it has faith in great abundance, and it is a much stronger asset – and one that the government would do well to cultivate.

Joseph Pak is a journalist based in Seoul

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