President Lee Jae Myung asks participants for their views during a nationally televised debate on real estate policy at the KBS Annex in Yeouido, western Seoul, on July 23. Since August, the government has announced a series of stringent measures focused on curbing property ownership, jolting the housing market.YONHAP
Choi Hoon
The author is a senior columnist at the JoongAng Ilbo.
President Lee Jae Myung is facing growing difficulties in governing. Personnel controversies, ruling-bloc moves to withdraw prosecutions and anger over housing policy have pushed his approval rating into the 30-percent range, roughly half its peak.
Presidents often comfort themselves by saying reform inevitably meets resistance, so approval ratings do not matter. Yet 35 percent is effectively the floor for sustaining presidential authority. A 1985 U.S. political science study by Douglas Rivers and Nancy Rose estimated that a 1 percent rise in presidential public support increased the legislative approval rate by about 1 percent, with agenda size held constant.
Once support falls into the 20s, rebellion begins inside the ruling party. A president who no longer helps lawmakers win votes becomes a target as they scramble to survive. The opposition attacks freely, though that does not necessarily help People Power Party leader Jang Dong-hyeok. Politics is like the Serengeti: Once an animal limps, hyenas close in. The media, sensitive to readership and ratings, also starts removing an unpopular president from front pages and headlines. That is how lame-duck status begins.
The public’s retreat from Lee cannot be traced to one issue. The administration resembles a patient with multiple fractures and organ damage, making recovery hard.
At a press conference, Lee described the dilemma between being “a president for everyone” and meeting “the expectations of supporters” who elected him. Progressive supporters demand stronger reforms while a broader public dislikes his policies. But the deeper problem may lie in Lee’s own view of government and markets.
In January, Lee said there were ample means to “normalize abnormalities” in real estate and declared that “no market can beat the government.” He asked whether owners could keep holding property if holding taxes became costlier than selling. His approval rating then stood at 61 percent, an early-presidency moment when power can create illusions.
Alfred Marshall formalized the modern concept of markets in 1890: Supply and demand interact, determining transaction volumes and prices until demand and supply prices reach equilibrium. Lee’s remark sounded like a challenge to a logic that has endured for 136 years.
Markets are driven by instinct, greed and competition. Failures can hurt the vulnerable, and markets can become playgrounds for the powerful. That is why progressives often target them for reform. Markets are never perfect. Yet no other mechanism has proved as capable of acknowledging human desire while reconciling competing interests.
Liberal democracy follows similar market logic. Parties and politicians offer voters candidates, policies and campaign pledges. If voters buy them, they receive electoral victory and power. If not, they are removed. Unchecked presidential power and the erosion of separation of powers distort fair political exchange much as monopolies distort markets. A government that fails to build political capital through public trust and opposition cooperation is ultimately rejected by its consumers: voters.
The administration’s falling support may stem from a five-year government, with three years and eight months left, trying to overpower a 136-year-old market.
The government talks about supply, yet has not broken ground on a public housing project, while seeking to stabilize prices through taxes and regulation. It has even introduced detailed “actual residence” requirements. But can any government judge 16 million homeowners’ circumstances and reliably distinguish speculation?
What great offense has been committed by someone who bought one home with a mortgage and spent a lifetime paying interest? Loan restrictions, land transaction permit zones and heavier capital gains taxes have instead contributed to frozen transactions, fewer listings, shrinking jeonse (lump-sum deposit apartment) supply and soaring jeonse prices, leaving people unable to move.
More troubling is the reversal from Lee’s May 8, 2025 campaign message: “Progressive governments suppressed demand through taxes and ownership restrictions. But the market overcame them. We will no longer try to control housing prices through taxes.” That pledge appealed to voters scarred by the Moon Jae-in administration’s housing policies.
Poll experts have attributed Lee’s losses partly to defections among people in their 40s and 50s, once strong supporters but vulnerable to higher taxes. The issue, then, is not simply progressive versus conservative, as Lee suggested, but pragmatism and trust.
The answer is to expand supply substantially, identify criminal speculation and otherwise let market mechanisms work. The same applies to proposals to withdraw prosecutions despite public opposition: only an unequivocal withdrawal of that idea can resolve the controversy.
No government can ever beat the market.
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
