Free The Two Koreas: A Contemporary History by Don Oberdorfer, Robert Carlin Page A

Promotion Plan, a massive program to build up six strategic industries—iron and steel, shipbuilding, chemicals, electronics, nonferrous metals, and machinery. Initiated in late 1971 and formally announced in January 1973, the plan was designed by Park to enhance his political legitimacy and to respond to what he saw as a perilous security combination: the North Korean military buildup, which became intensive as Pyongyang asserted greater independence from the Soviet Union and China in the mid-1960s, and his decreasing confidence in American security assurances, as the United States disengaged from the Vietnam War and sought to reduce its commitments elsewhere in East Asia.
    The Heavy and Chemical Plan, which Park conceived and rammed through despite the misgivings of the Economic Planning Board andother economists, was the foundation of Korea’s later success in automobiles, shipbuilding, and electronics, but it was also very costly and eventually was scaled back considerably. Cho Soon, a prominent economist and scholar who later became mayor of Seoul, wrote in a retrospective analysis that the scale of Park’s projects “exceeded by far what the country could accommodate” and substituted government decision making for private initiative in the economy. Accordingly, Cho wrote, “The results were waste and distortions in resource use, inflationary pressure, the emergence of immense conglomerates, and widening inequality in the distribution of income and wealth.”
    Nevertheless, the overall results of the development program that Park put in place between 1961 and 1979 were spectacular. In broad terms, according to the World Bank, South Korea’s inflation-adjusted GNP tripled in each decade after Park’s first year in office, thereby condensing a century of growth into three decades. At the same time, the country dramatically reduced the incidence of poverty, from more than 40 percent of all households living below the poverty line in 1965 to fewer than 10 percent in 1980. Per capita income shot up from less than one hundred dollars annually when Park took power to more than one thousand dollars at the time of his death and more than ten thousand dollars today. In view of these achievements, it is small wonder that he is viewed by most South Koreans in retrospect as a leader of unparalleled greatness.
    WASHINGTON BLINKS AT PARK’S COUP
    At 6:00 P.M . on October 16, 1972, Park’s prime minister, Kim Jong Pil, notified US ambassador Philip Habib of a sweeping change in the country’s political direction, requesting that it be kept secret until made public twenty-five hours later. The surprise announcement by Park, a copy of which was handed to Habib, declared martial law, junked the existing constitution, disbanded the National Assembly, and prepared a plan for indirect election of the president. At the same time, to silence opposition, Park arrested most of the senior political leaders of the country.
    Park called his new system yushin , which his spokesmen translated as “revitalizing reforms,” and justified his actions on the grounds that the nation must be strong and united to deal with the North and maintain its independence in a changing international environment. The proposed announcement laid heavy stress on perils beyond Korea’s shores, as “the interests of the third or smaller countries might be sacrificed for the relaxation of tension between big powers.”
    Despite the emphasis on external threats, Habib had no illusions about the real purpose of Park’s dramatic moves. He cabled Washington within a few hours to say that “the measures proposed are designed to insurethat President Park will stay in office for at least twelve years with even less opposition and dissent and with increased executive powers” and that “if these proposals are carried out Korea will indeed have, for all practical purposes, a completely authoritarian government.” While the ambassador conceded that Park might