company practices and North Korea, even though such comparisons are
fairly common among Samsung employees themselves. Steve Jobs had his
own cult at Apple, Samsung employees tell me. Samsung isn’t the only
electronics maker with cultish tendencies.
But Samsung’s logic was a type of red herring, a way of diverting
attention.
Pointing to similarities between Samsung and other companies doesn’t
dismiss the common culture and heritage between North and South Korea
and, to some extent, Japan and China. The fact is that the South Korean
chaebol have little in common with the more entrepreneurial and
shareholder-driven firms in the United States.
Even the biggest companies in the United States do not enjoy the
privileges of companies in South Korea today. More than half of the family
leaders of the ten biggest chaebol groups are convicted criminals. All have
been pardoned by the president, often without serving prison time. Three of
them, including Samsung chairman Lee Kun-hee, have been pardoned
twice. From January 2015 to February 2016, the outside members of
Samsung Electronics’ board of directors—who were supposed to be
independent, as a check on corporate governance—unanimously approved
every proposal put forward by the company, except the two times a director
was absent.
Imagine the heirs of the Carnegies and Rockefellers being so powerful
and revered that The New York Times would self-censor its coverage out of
deference. Imagine a White House pardoning the heirs of Sam Walton or
Ray Kroc, as they ran the operations of Walmart or McDonald’s from their
prison cells. Or seasoned journalists turning their eyes away when
confronted with Donald Trump’s conflicts of interest between his
presidential duties and his businesses.
Because of the outsized privileges of Samsung and the Lee family,
South Koreans tell me Samsung has grown too big to fail.
But Sangin Park, an economics professor at Seoul National University,
puts that “too big to fail” label in perspective. The continued success of
South Korea’s economy hinges not just on the Samsung Group as a whole
but on a single company within the Samsung Group:
According to crisis simulations I have carried out, if Electronics stocks fall by
70%, both Samsung Insurance and Samsung C&T will become bankrupt. It is