What strange set of circumstances could connect the issue of tax probes of Korean media outlets with China's bid for the Olympics and advertising policy of a Hong Kong bank? While it may not seem obvious at first glance, the linkage relates to freedom of expression.
In the case of Korea, the National Tax Service (NTS) and the Fair Trade Commission, media outlets were hit with over 500 billion won in penalties and fines. After this ruling, prosecutors were told to investigate six major papers and three of their owners.
To aid in this investigation, former and incumbent accounting officials of three daily newspapers were called in by prosecution officials for questioning in connection with a probe of alleged tax evasion. At the same time, prosecutors have imposed an overseas travel ban on 25 financial officials of the accused newspapers in connection with the same tax probe. Suggestions have been made that the media is being punished for criticisms of the current government. It is no small matter if tax investigations are politically motivated. The amounts involved are substantial enough to seem draconian. But the individuals being charged are taking these accusations of tax evasion very seriously since convictions could mean life sentences.
For its part, Seoul insists that an ongoing tax probe into the newspaper companies on charges of tax evasion, unfair business practices and other irregularities is free of any political intent. South Korean President Kim Dae-jung is on record insisting that allegations that the tax probe was meant to suppress critics of the government are baseless.
Perhaps Shakespeare said it best. "Methinks the lady protests too much." As with most political denials, pronouncements tend to be more about concealing than revealing.
It is no secret that many of Seoul's newspapers express hostility to Kim and his policies. With the president's approval rating at a record low of 26 percent and elections due next year, skeptics might be forgiven for doubting the good faith exercise of the tax authorities. But it is also no secret that many of the media firms and their family owners are not much better than the owners of the chaebol that have become the subject of such widespread scorn. Both have almost certainly used altered or duplicate accounting books and probably confused corporate accounts with their own.
If the claims are true, then there should be a criminal investigation into the alleged tax evasion according to the rule of law. And this would be an excellent opportunity for media firms to become more transparent and strengthen themselves organizationally.
At the same time, an alarming number of journalists recently revealed in a poll that they have accepted payoffs. By coming clean on its own sins, the media could make a showing of its strong commitment to end the culture of corruption that is all too common.
After decades of military rule where censorship was strongly enforced, it would be surprising if the Korean media did not suffer some growing pangs. Yet the media is too important to the wider community for it to be muzzled by political interference or corrupted from within.
As always, when it comes to questions about freedom of expression, China makes for interesting reading. An interesting test for the leadership in Beijing will come now that it was chosen to host the Olympic Games in 2008. Promises were made to the International Olympic Committee that journalists can freely cover events. However, this assurance, even if it were given in good faith, is of little value. In absence of due process and the rule of law in China, anyone engaged in a news-gathering activity faces completely arbitrary judgments over whether their actions are in violation of some ordinance.
As a matter of domestic conditions, Beijing has doled out punishments against domestic newspapers that were felt to have overstepped acceptable ideological bounds. At the same time, Chinese citizens have been prosecuted for posting opinions on the Internet that offended official sensibilities. Another egregious violation of freedom of expression relates to the 14 female Falun Gong adherents who died in a labor camp in northeast China.
Falun Gong
Thousands of Falun Gong adherents have been sent to labor camps after the movement was banned in July 1999 on the basis that it is a dangerous cult. While the Chinese government insists that the women committed suicide, a US-based Falun Gong Web site claims they were tortured to death. Eleven others were reported to have attempted suicide but supposedly were stopped by camp guards.
There has been much coverage of a storm that has brewed in Hong Kong after a story appeared in Next magazine alleging that the chief executive of Hang Seng Bank, Vincent Cheng Hoi-chuen committed some minor improprieties. Instead of defending his integrity with a libel suit, management of the parent company HSBC announced the cancellation of all advertising with Next as well all other publications of the Apple Group.
Many observers raised questions over whether members of corporate management should use control of advertising budgets to threaten editors to control critical reportage. The good news, of course, is that the issue has been so widely discussed. Perhaps HSBC management is the party most chastened by this affair.
From a broader perspective, HSBC's actions have dealt Hong Kong's reputation as a paragon of corporate transparency and accountability amidst Asia's murky waters yet another damaging blow. The timing could not have been worse given that the chief executive is already having to defend his role in upholding the operation of the "one country, two systems" in the court of world opinion.
In all these events, freedom of speech, underpinned by a free press, is a key element for any country whose citizens aspire to be free because it serves to ensure greater openness and accountability in both government and corporate affairs. As evident in the instances cited above, these freedoms are constantly under threat from many quarters. There must be constant vigilance so that such unwarranted curtailments of these important rights can be denounced loud and wide.
Perhaps these events should be interpreted as part of the process whereby Asian countries undergo fundamental shifts in their political governance. As dominant political culture moves away from authority-based institutions toward arrangements that protect and promote the rights of individuals, there will be many similar skirmishing actions as the historical power centers try to hold back threats to their dominance.
Christopher Lingle is Global Strategist for eConoLytics.com and author of The Rise and Decline of the Asian Century.
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