President Lee Jae-myung said Thursday that he "could utilize the emergency fiscal decree prescribed by the Constitution if necessary," in relation to energy supply instability caused by the war in Iran. At a Cabinet meeting he chaired at Cheongwadae, President Lee said, "When deliberating countermeasures, there is a tendency to keep relying on conventional procedures, but more preemptive and bold responses are needed." The emergency fiscal decree, stipulated in Article 76 of the Constitution, is an exclusive presidential authority to issue orders carrying the force of law without National Assembly approval during a national emergency. It has not been invoked since the "private loan freeze" in 1972 and the "real-name financial transaction system" in 1993. That President Lee went so far as to mention the emergency fiscal decree power vividly shows how gravely he assesses the current external conditions.
President Lee's remarks are significant in that they reveal a strong will and sense of responsibility toward overcoming the Middle East crisis. The war in Iran risks delivering a critical blow to the broader real economy, including prices and exports — the backbone of our economy — by triggering surging oil prices and a supply chain crisis. It is a natural duty for the nation's top leader to demonstrate a willingness to block market anxiety early using every available means and to respond preemptively.
However, there is room to question whether it was necessary to mention considering an emergency fiscal decree at this juncture, when the government has already drawn up a 26.2 trillion won supplementary budget to respond to the Iran war crisis and National Assembly deliberation and a vote are imminent. The Constitution strictly limits the use of emergency fiscal decrees to cases of "civil unrest, foreign threats, natural disasters, or a grave fiscal or economic crisis." Given that this is an authority granted to the president only exceptionally during urgent emergencies, it must be exercised with prudence.
Our economy is now seeing its growth momentum sharply deteriorate amid the triple headwinds of high prices, high interest rates, and a high exchange rate. Even considering the urgency of the situation, emergency fiscal decrees should be used only as an exception. As President Lee himself ordered Thursday, the government's immediate priority should be managing critical raw materials such as helium and urea solution at wartime levels, and mounting a full public-private response to supply instabilities in daily necessities and medical supplies directly affecting people's lives. Constitutional emergency powers must remain a last resort. Before considering an emergency fiscal decree, the ruling party and the government should first achieve swift and thorough passage of the supplementary budget through bipartisan cooperation with the opposition.