Lee approval slide sends warning signal

Lee Hyun-sang

The author is a columnist at the JoongAng Ilbo. 

Approval ratings for presidents in the first year of their terms generally show a gradual decline. Perhaps it is simply that the high hopes placed in a new administration are slowly tempered by the realities of governing. There have been a few notable exceptions: Roh Tae-woo and Park Geun-hye, whose ratings started low but rebounded amid the fallout from efforts to settle accounts with the Fifth Republic and chaotic personnel appointments, respectively; and Roh Moo-hyun, whose approval rating plunged amid political conflict over his reform drive.

By comparison, the Lee Jae Myung administration is a rare case of a government that began with relatively high approval and managed to sustain it. According to Gallup Korea, President Lee’s job approval stood at 64 percent in the first poll conducted after he took office in June last year. By late March and early April this year, it had actually risen to 67 percent. His strategy of broadening his appeal to centrists gained traction, while policy achievements, including the rise in stock prices, also helped.

But the trend has now flashed a warning signal. In Gallup Korea’s fourth-week-of-July poll, President Lee’s approval rating stood at 51 percent — a drop of 16 percentage points in just three or four months. It remained above 50 percent in Gallup Korea’s telephone-interview surveys, in which respondents speak directly with interviewers. But in automated response system (ARS) surveys, which offer greater anonymity, negative evaluations have repeatedly overtaken positive ones, producing what is known as a “dead cross.”

On a stock chart, such a sharp decline in approval could be likened to a long bearish candlestick appearing in a rising market. The long blue bar, which reflects powerful selling pressure, is generally regarded as a warning that an upward trend may be about to reverse. That was precisely what happened to the Kospi: After drawing a long bearish candlestick in late June, the index turned sharply downward.

Several adverse factors converged. Stock prices plunged, while the housing market became an albatross around the government’s neck. The administration’s much-touted image of “competence” began to crack.

The decisive factor, however, was the revision of the Criminal Procedure Act. If the stock market and housing problems are questions of competence, forcing through the revision of the criminal procedure law raises a more serious question of values and morality. Despite overwhelming public opposition, the ruling party ultimately abolished the prosecution’s authority to conduct supplementary investigations. People began asking whether the state was truly on the side of victims and the vulnerable — or on the side of criminals.

After Rep. Kim Yong-min posted on social media, “President Roh Moo-hyun, you must be saying, ‘Hey, this feels great!’” in reference to the law’s passage, the victim of the so-called Busan roundhouse kick incident replied, “Go to hell.” It was a cry born of a much more fundamental question: “Will the law actually protect me?” The perception that a ruling camp’s desire for personal political revenge had undermined the system designed to protect the vulnerable appears to have alienated even women in their 20s and 30s, once among President Lee’s strongest constituencies.

President Lee did not exercise his veto. There had been some hope that he might, but the outcome was as expected. He left behind only the ambiguous remark that even a policy begun with good intentions is worse than doing nothing if it harms people’s lives. But he must now take responsibility for the consequences of his decision. Whenever an inadequate police investigation or a cover-up of a case comes to light, the decision could return like a boomerang and hit the administration.

The ruling camp faces an increasingly difficult situation. It risks falling into a vicious cycle of “negative feedback,” much like a leveraged ETF that magnifies a stock market decline. If the ruling Democratic Party's leader, Jung Chung-rae, wins the party's leadership race, a hard-line political drive could widen the gap between the party’s base and the broader public. If candidate Kim Min-seok wins, efforts within the party to defuse President Lee’s legal risks could intensify, potentially provoking an even stronger public backlash.

Ultimately, the only way forward is to confront the problem head-on. President Lee will find it difficult to reverse the downward trend unless he draws a clear line between himself and questions surrounding his legal risks and a possible extension of his tenure, while also declaring that the issue of investigative powers will be reconsidered from the perspective of ordinary citizens and crime victims.

Few investors are perceptive enough to recognize the warning of a long bearish candlestick when it first appears. Even those who do often tell themselves, “Surely it won’t come to that” and take comfort in assurances that “the fundamentals remain sound.” The sharp decline in the president’s approval rating is now signaling that serious questions are being raised about the administration’s fundamentals — its policy competence and moral credibility. The opportunity for a reversal may begin precisely when the ruling camp honestly acknowledges that reality.

Stock investors can at least cut their losses when a powerful downward signal appears. Politics has no sell button. With the opposition so feeble that it cannot even serve as a credible alternative, the frustration of centrist voters is becoming as deep as the gloom hanging over today’s stock market.