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In This Series
  • Part One: Middle Class Plunging Back Into Poverty
  • Part Two: A Generation Lost to Destitution
  • Part Three:
    From Boom to Bust
  • Part Four: In Japan, three friends commit suicide
  • Part Five:
    S. Korea's Middle Class Hides Its Despair
  • Part Six: Indonesia's Scapegoats
  • Part Seven: Economic Crisis Steals Christmas
  • Part Eight: Crises Teach Graduates New Lessons

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  • Asia Economies Report
  •   Asia's Broken Lives
    Middle Class Plunging Back Into Poverty

    At a soup kitchen near Pagoda Park in Seoul, Kim Kim Bok hands out meals to the homeless and the needy.

    First in a series of
    occasional articles

    By Mary Jordan
    Washington Post Foreign Service
    Photos by Nancy Andrews
    Sunday, September 6, 1998; Page A1

    The ambulances, lawyers and guards with chains swooped into Seoul Christian Hospital without warning one day this summer. They loaded patients onto gurneys and carted them all away, including a semiconscious little boy who had lain curled and silent in Room 3B since his birth nine years ago.

    They chained down expensive equipment and locked cabinets and doors. They took away medicine and machines and all the things that had saved lives here, until South Korea's economic collapse made lifesaving too expensive.

    When the hospital went bankrupt, all that was left behind was the disbelieving staff – more than 200 nurses and pharmacists and medical aides who had stuck by their patients and their hospital long after their paychecks stopped coming. They were owed an average of $7,000 each in back wages, and when the owner tried to throw them into the street, they simply sat down, too stunned to move and too scared to face life without a job.

    This is what the Asian economic crisis has brought to South Korea. Nearly 100 times a day somewhere in this country, someone's dream – a tennis shoe factory, a corner grocery story, a giant automaker, a promising fashion house, even a hospital – is crushed under the weight of the economic collapse. Unpaid bills are piled too high, the "closed" sign is posted, workers are dumped, and the nation's economy slips a little lower.

    From the tropical islands of Indonesia to the mountains of Thailand to the factories of South Korea, East Asia's amazing rush to affluence in the last 25 years made life better, safer, more comfortable and more hopeful. But the growth went haywire – too much borrowed money and too much corruption – and the abrupt crash has shattered the lives of tens of millions of people.

    "Every aspect of my life has changed," said X-ray technician Youn Sung Mook, 32, who hasn't seen a paycheck since February and began sleeping in the hospital lobby when it shut down. "Just about everything is gone, even my friends. I avoid them. It is too embarrassing to go out with an empty wallet."

    The greatest success story of East Asia – the emergence of a broadening middle class – is evaporating like steam from a cup of tea. Millions of newly comfortable people who had decent jobs and good living conditions, who were better educated and living longer than their parents, are slipping back into worse conditions.

    Hunger and malnutrition are rising, more and more children are dropping out of school, and child labor is increasing as Asia's miracle dissolves into misery. And those who already were poor are suffering even more.

    Relentless waves of bankruptcies and unemployment are battering the region. In Indonesia, there were about 5 million people unemployed last summer. By the end of this year, that number is expected to reach 20 million – nearly twice the combined population of Maryland and Virginia. Another 1 million have lost jobs in South Korea this year, and 2,000 people a day are losing jobs in Thailand.

    Americans increasingly view the year-old Asian financial crisis in terms of how big a threat it is to Wall Street. But in Asia, the crisis is wrecking so many lives that the focus is not on investment returns but on what some are calling a historic "class plunge."

    "I can't even eat what I want to eat," said nurse Chang Sook Hee, as she recalled weekends and fun and how life used to be. Most of the summer, she too slept in the hospital's dimly lit lobby surrounded by her colleagues – people with college and professional school degrees who used to enjoy expensive vacations but now cannot afford to eat meat or go to the movies.

    Until this year, Chang had just about everything she wanted, except time. She had two children and a job she adored; she was proud to be elected a union chief. But now her allegiance to her union and her family has created "tension." "I have no expectation that it will get better any time soon," she said.

    "I can't even imagine buying clothes for myself. I can't buy gifts for my parents' or my kids' birthday," said Chang, 32. When she and the others talk about maybe someday getting the money to eat out, it is no longer about sipping chardonnay at a restaurant with tablecloths – it is more like Chicken McNuggets.

    The East Asian middle class is diverse: In poor Indonesia or the villages of Thailand, a successful middle-class person might be defined as one with glass in his windows and cows in his field; in the richer nations of South Korea and Singapore, the worker drives a reliable car and travels abroad. But the crisis unites them in loss: Whatever these people had, they suddenly have a lot less of it.

    In Chiang Mai in northern Thailand, Somjit Klangjai worked six years in a cigarette factory and did not consider herself poor. But she and 100 others who used to turn tobacco leaves into cigarettes lost everything almost overnight when the factory shut down. She is selling her possessions one by one to keep going. She is down to one hen.

    "You sell whatever you have. If you have chickens you sell chickens. If you have rabbits, you sell rabbits," she said, adding to the chorus of people who say it is humiliating and depressing to go from comfort to need overnight. "I cried. I tried to commit suicide. I wanted to escape from this world."

    The crash has exposed how vulnerable people were. Many borrowed far more than they had saved, so office clerks, bank tellers and construction and factory workers who had grown accustomed to nightclubs and cellular telephones had little to fall back on when the crash occurred. In a matter of weeks they slid from a good life to borrowing to pay for groceries and sleeping on the mats and floors of relatives to avoid paying rent.

    Former employees have refused to leave Seoul Christian Hospital for more than two months, demanding back pay.
    In each of the three hardest-hit East Asian countries – Indonesia, Thailand and South Korea – yuppie-oriented outdoor food carts have become a favorite way for out-of-work stockbrokers and car salesmen to earn cash. They now sell treats they had grown used to, such as cappuccino and Black Forest cake, to people who can still afford them.

    "For the last 30 years, it was growth, growth, new jobs, new jobs, so people all became middle class," said Kim Young Jin, president of Jindo Corp. in Seoul, a once-thriving company that manufactures commercial shipping containers. In the last year, Kim has had to lay off 1,100 of his 1,700 workers. "Now it is really miserable. There is no middle class. These people are all lower class."

    The dozens of hospital employees living in the lobby of the Seoul Christian Hospital have slipped from comfort to desperation in one year. Since July, many of them have slept in the lobby because they don't have 30 cents for bus fare to go home and back every day. Some of them are camped out in the quixotic hope that if they just stay put, maybe they will get the money they are owed. And more importantly, maybe they will get their old jobs back and reenter their lost lives as if nothing had happened.

    For years, the six-story hospital has been a meeting place and cornerstone of the low-income neighborhood of Myunmok Dong, but now it is a hushed, hollow place. A nurse recently sat on newspapers and peeled potatoes for lunch. Rows of citrus-colored waiting room chairs, once filled with people waiting for prescriptions, now are heaped high with jeans, hair dryers and other personal belongings. Laundry dries on a plastic rack in front of the shuttered pharmacy.

    "I feel like we've been fooled," said a pharmacist. "How else could this happen?"

    An Asian 'Lost Decade'?

    The first attempts at quantifying and estimating the scale of human suffering in terms of school dropouts and child labor, rising medical problems, poverty and hunger are now being made by the World Bank, Oxfam and other international relief organizations and the individual countries themselves. In interviews with those conducting the surveys that will be released in the coming months, all indications are that the human aftershocks of the crisis have been underestimated.

    "It is not a total wipeout," said Charles Morrison, president of the East-West Center in Honolulu. "But it is a tremendous reversal for the region. It's no longer a question of whether the region will recover in one year or two, but whether the recovery will come in five or 10 years."

    In the meantime, the growing gap between rich and poor has raised global concerns about class conflict and political instability. In Indonesia, where one in five workers is expected to be jobless by year's end, there already have been eruptions of lawlessness and looting, as well as violence against the country's better-off ethnic Chinese community.

    Economists have stopped drawing charts of what happened here as a "V," since almost no one believes the sudden collapse will be followed by a quick recovery. The graphs now look more like an "L," with the crash followed by an extended period of hard times.

    Scholars are beginning to wonder if this is the beginning of the Asian "Lost Decade," a reference to the living standard setbacks in Latin America in the 1980s after a similar debt crisis.

    People here are just surviving one day at a time.

    "All I can do is try as hard as I can and pray," said Zen Zainudin, who sang for six years at the New Mugen karaoke club in Jakarta before it shut down this year. As he sat on a blue metal bench outside a government employment office in the Indonesian capital, he said he only needed about $30 to cover his monthly food and housing expenses, but he had no idea how he could find a job when so many others also are looking.

    "Their world has just crashed around them," said Lim Say Boon, regional director of the Singapore-based Crosby Corporate Advisory group. "They are shell-shocked, numb."

    In Thailand, jobless bankers and stockbrokers have earned cash by selling their designer clothes and jewelry at informal Markets of the Formerly Rich. For many of them, it is a humiliating experience.

    Yupavadee Sungkamala, 30, stood in one of those markets recently in Bangkok with armloads of her belongings; she needed cash since she had lost her job selling medical supplies. As she stood with her arms folded uncomfortably, a young man bargained hard for her golf clubs. She wasn't asking all that much – about $50 – but the man was offering only half that.

    Sungkamala already had sold her car to keep her house, and it was getting harder to part with her favorite possessions. "Something like the golf clubs, that I loved, when they bargain so low it hurts," she said.

    Eggs and more eggs – that's what this crisis has come down to for Kalya Sripran, a laid-off factory worker in Bangkok. Her once diverse diet has been narrowed to mostly eggs – boiled, fried, scrambled. She tries to make a living peddling fruit from her bike. Her main goal – like so many middle-class Asians – is to keep her two children in school. She said it is a shocking comedown to find herself desperately trying to feed and educate her children after taking those things for granted for so long.

    "I'd sell part of my body to keep them in school," she said about her children, ages 7 and 17. "Even if I have to sell a leg or a hand, I'll keep them in school."

    Page Two | Printable Full Text

    © Copyright 1998 The Washington Post Company

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