Lee: "Take Responsibility for Promoting a Crude Economic Philosophy"
On May 20, Lee Junseok, the presidential candidate of the Reform New Party, criticized, "Lee Jaemyung, the presidential candidate of the Democratic Party of Korea, is presenting internet memes as solutions to drive the South Korean economy." He directly targeted Lee Jaemyung's use of the concept of hotel economics as an example to advocate for the effectiveness of local currency and basic income.
On this day, Lee Junseok posted a link on Facebook to the website of the Mises Institute, an American economic research institute, and stated, "This is the oldest article from 2009, which is considered the origin of 'hotel economics' that can be found on the internet."
He continued, "In 2009, Austrian school economist Robert Blumen introduced a similar case in a contribution to the Mises Institute, criticizing it as a 'misleading brainteaser.'" He pointed out, "This story is not an economic discourse but is intended to present a paradox, and the original source is a blog post uploaded by someone on June 15, 2009."
After posting a link to a personal overseas blog, Lee Junseok directly criticized, "If Lee Jaemyung read this article and adopted hotel economics as his economic philosophy, it means he is trying to run the South Korean economy based on an internet 'mockery' as the original source."
He especially emphasized, "This story is actually a paradox that amounts to crude mockery, and in the original, the person bringing money to the hotel is a 'prostitute.' Just because Lee Jaemyung replaced the prostitute with a stationery store in his version does not make this story a plausible economic discourse," he strongly criticized.
Lee Junseok stated, "I thought I had experienced almost every bizarre situation in politics, but this is the first time I have seen someone stand on a campaign truck and present something at the level of an internet mockery as an economic policy, insisting on it forcefully. He should withdraw this and take responsibility for presenting such a vulgar story as his economic philosophy."
According to the hotel economics concept mentioned by Lee Jaemyung during his campaign in Gunsan, North Jeolla Province, on May 16, if a customer books a hotel room for 100,000 won, the hotel buys a bed from a furniture store for 100,000 won. The furniture store orders chicken from a chicken restaurant for 100,000 won, the chicken restaurant purchases stationery for 100,000 won from a stationery store, and the stationery store repays the 100,000 won it borrowed from the hotel, creating a circulation. The logic is that even if the customer cancels the hotel reservation and no money is ultimately spent, the circulation of money revitalizes the local economy.
Lee Junseok and Lee Jaemyung also debated this topic during the 21st presidential candidate TV debate held on May 18. Lee Junseok pointed out, "Is this a perpetual motion machine? In the diagram related to hotel economics, the money does not disappear but continues to circulate with a marginal propensity to consume of '1'." In response, Lee Jaemyung argued, "The marginal propensity to consume does not remain at '1.' That was just an extreme example. Why oversimplify it? The point was to emphasize the importance of circulation in the economy."
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