Free trade is more than moving goods:

Rice Fields and Golf Courses

by Roger Bourke White Jr.

Free Trade means more than just moving goods from one country to another, it means moving ideas and concepts as well. What can free trade mean for Korea? NAFTA and the Uruguay Round of GATT are about only one part of free trade. They are about moving manufactured goods and agricultural products. These are important parts of free trade, but there is much more. Free trade brings opportunities for growth in service, finance and information age industries as well. This essay is about a plan to use free trade to solve two problems I have seen vexing Koreans today: How to deal with rice imports and how to play more golf.

Prosperity brings variety

Korea is becoming a prosperous society. Prosperity brings many things. It brings good health, better education and material well-being. It also brings pollution, congestion and noriban. Prosperity brings is variety. The more prosperous Korea becomes, the more variety it has in what it can offer the world and what it can consume from the world. In the 1960s Korea could only offer ships and iron to the world, in the 1980s it could offer automobiles and electronics as well. What will Korea be able to offer the world in the 1990s and the 2000s?

Some overlooked Korean assets

One hundred years ago Koreans looked at Korea and saw a land well suited to growing rice. Korea seemed so well suited for rice growing that many Koreans felt rice was Korea and Korea was rice. Today many Koreans look at Korea and see a place for factories as well as rice. Many Koreans today feel manufacturing and rice growing is Korea and Korea is manufacturing and rice growing. (This, by the way, is an example of prosperity bringing variety.)

I came to Korea in October of this year. When I came, I saw rice fields and factories, and I also saw beautiful mountains and islands. Can these beautiful mountains and islands work as hard for Koreans as rice fields and factories?

Some Korean Concerns

Koreans subsidize rice growing and discourage rice imports. They do this to support Korean farmers. I have also heard that President Kim has banned Korean government officials from golf courses. President Kim did this because many Koreans see golf as elitist: something only the rich and powerful could afford to do. I look at this declaration and see signal that there is a mismatch between golf course supply and golf course demand in Korea--too many people want to play golf on too few courses.

But is the rice subsidy doing what it is supposed to? Has subsidized rice produced prosperous farmers that are contributing a lot to Korean society? I am told that rice farming is still a 3D occupation--dirty, dangerous and difficult. I am told that rice farmers are poor, and that there are many old rice farmers, but few Korean youths want to become rice farmers. Subsidizing rice is a half solution to the problem of supporting farmers and making farming an attractive way of life. Rice subsidy supports farmers, but it doesn't produce an attractive way of life.

Is the ban on government golf doing what it is supposed to? Does the ban make Korean officials look less elitist?

Preserving Korean Culture

One of the goals of every nation is to preserve its distinctive cultural heritage. Korea is no exception. It's important to keep alive Korea's many folk traditions. But it's important to understand that this heritage will live for a different reason in the future than it did in the past. In the past the harvest dance was an agricultural tool. Now Koreans use fertilizer and satellite weather forecasting. The harvest dance will be revived as art--for the pleasure of doing it and watching it. Folk culture survives as art, not as practical tools.

What will make folk tradition survive in Korea is promoting an interest in Korean folk traditions as art, and here again, free trade can help.

Does free trade offer a way of Is there a way of matching these concerns

So, lets put these elements together. We have Koreans paying for more rice fields and rice farmers than it needs. We have lots of rice farmers doing 3D work that would rather be doing something else that wasn't 3D. We have Koreans wishing they would play more golf, we have Koreans who would like to see more people pursuing Korean folk traditions and we have beautiful mountains and seasides waiting to contribute to Korean society. Can a single free trade plan solve all these needs.

Of course, lets convert rice fields into golf courses.

Does subsidizing rice do what it is supposed to?

The goal of subsidizing rice is to keep Korea Korean. But is it accomplishing that goal? Rice farming is important to Korea, in the past it was one of the most important things Korea did. But today Koreans do many more things than it did in the past. Today Korea is a manufacturer and an exporter as well as a rice producer.

What effect does rice subsidizing have on Korea? Rice farming uses more land than would be the case if rice was sold at free market price. Rice fields are created where rice can be grown profitably. Rice subsidies mean that land with poorer yield can be farmed profitably, so rice fields are cleared higher up the slopes when there is a subsidy--rice fields replace forest land. Rice fields also replace other farm land. Land that is well suited for fruits and vegetables but marginally suited for rice will be used as a rice field.

Subsidies create a mix of more rice farmers and richer rice farmers than would be the case if rice was sold at free market price. From what I have heard, the subsidies in Korea seem to have created more farmers rather than richer farmers. Even with subsidies rice farming is still a 3D activity--the old farmers work hard, but produce little because the small paddies are not well suited to mechanized farm tools, and young Korean men don't want to be rice farmers if they can help it. Ironically, rice subsidies have promoted foreign travel: I hear many young rice farmers go to China for wives.

So, are rice subsidies keeping Korea Korean? If you define Korea as farmers putting in long hours for little pay on a 3D job, then the subsidies are doing a fine job. But if farming today is such a virtuous and spirit-building occupation, why are Korean farmers looking for wives in China?

There is, perhaps, a better way of keeping Korean farmers in the fields, and making the occupation so attractive that Korean woman will once again consider Korean farmers as attractive.

The alternative to rice fields

Some Korean rice fields could be used for a different high demand activity: golf courses. The same fields that are poor rice paddies can become spectacular golf course fairways and greens. The worst rice fields are those highest on the slopes. The worst rice fields are the ones next to the lush forests that cover the tops of Korean mountains. Those fields are the most scenic, and the ones that will make the most challenging golf holes. In other words, marginal rice fields in Korea could become golf courses, and Korea could be covered with world-class golf courses!

If this happened, golfing prices in Korea would tumble and more Koreans would be playing. Everyone could enjoy golf, including farmers and government officials. It would no longer be expensive and elitist.

What would happen to the farmers? They would farm, but they would be greenskeepers instead of rice farmers. They would maintain the greens, fairways and gardens of the golf courses. This activity could attract young men as well as old. Golfing would be brought into an area only if it were profitable to do so. If the golf course is profitable, it can afford to pay workers well, and design the working conditions so they are up to the same standards as Korean manufacturing workers enjoy. If young men see a job that pays well, is well designed, and contributes to Korean culture, they will come.

Golf courses can contribute a lot to Korean culture. Golf courses will bring lots of visitors to the villages and towns where golf courses are located. These visitors would make golf course towns and villages more lively and interesting than they would be otherwise. The visitors are going to spend money on more than golf, they will spend money on food and entertainment as well. Entertainment would flourish in the countryside, for visitors and for local people. There will be a demand for performances, and these can be performances of Korean culture as well as many other kinds. All this adds up to a more interesting countryside, and less reason for young men to go to the city.

Golf courses and free trade

Where does free trade fit into this?

To answer that, think of who lives very near to Korea, and pays high prices for golfing? The Japanese. Who else lives very near to Korea and could easily develop a taste for golf over the next ten years? The Chinese. If the Japanese and Chinese discover that Korea is full of nice, inexpensive golf courses, then flying to Korea for a weekend of golf becomes a thriving industry. It could become a giant industry! Japan and China could make Korea rich. If Korea specialized in developing golf courses instead of rice fields, the rest of east Asia would pay them handsomely for their dedication.

There is more. For a giant golf industry to evolve, Korea would have to undergo dramatic infrastructure changes. These infrastructure changes would center around making it convenient for visitors to enter and leave Korea, and get to their golf courses. Transportation, communication, signage, immigration and customs, would all have to change. Regional airports would become destinations for international flights. Cellular phone service would cover the country. The country would be filled with English, Chinese and Japanese signs. Immigration and customs would become streamlined so that a weekend trip to Korea would be no more hassle than flying domestically. The Chinese and Japanese would find Korean folk entertainment even more fascinating than Koreans do because for them it would be an exotic experience, so Korean culture would find even more support.

These changes would make it easier to move all kinds of goods and people into, out of, and throughout Korea. Manufacturing would become easier and more efficient. These changes would also make it easier to do business outside of Seoul. Koreans could succeed in business even if they didn't live in Seoul. Seoul would stop growing so fast, because the nation could decentralize.

You have read my modest proposal: that Korea substitute golf courses for rice fields. This proposal is a demonstration of a thought game. In this case the game started with the thought: What would happen if Koreans didn't treat rice subsidizing as a 'given'--something that has to be done? Thought games are a fun way to explore new ideas.