As Korea's prosperity has grown, so has its vehicle population. As of March, 2002, the Korea Automobile Manufacturers Association reported a population density of almost 270 vehicles for each 1000 South Koreans. That's quite a bit less less than the US rate of about 760 per thousand, but it still represents a 1,800% (!) increase since 1980. KAMA figures that vehicle ownership in Korea will grow at 5.2% per year, reaching 670 per thousand by 2020. Where will they put them all?

To make things worse, Koreans are following America's lead. They're buying big, fuel-guzzling SUVs, in spite of Korea's relatively high fuel prices. Why? Partly because of a change in the way South Korea figures tax.

Vehicle taxes and usage fees have always been based on the vehicle's engine size. Until the last few years, the rates increased rapidly as engine size increased. The Korean government figured that a Korean who could afford a big gas-guzzler could afford to pay more tax, and should cover some of the social costs of bigger vehicles (pollution, traffic congestion, more death and injury from accidents).

But in 1999, they changed the tax rates. In some cases, it now costs less in taxes to own an SUV than to own a regular passenger car. That was partly because of Korean automakers' lobbying when they saw how much their US counterparts were making on SUVs.

But, curiously, the US government is also partly to blame. In 1998, the US Trade Representative issued a memorandum of understanding, which was based on previous negotiations between the US and Korean govermnemts. Basically, it was supposed to make big gas guzzlers -- the US automakers' specialties -- cheaper in Korea.

It was partly successful. Thanks to the lower taxes, cheaper fuel, Western influence, and Korea's fiscal recovery, the number of SUVs on Korea's roads jumped 80 percent from 1999 to 2000. That year, there was a total of 251,000 SUVs on the road. The trend has only accelerated: in 2003 alone, almost 400,000 more SUVs joined them.

Uh, one little problem, though. By and large, they're not Ford Explorers, Chevy Blazers, and Jeep Cherokees. Just about all of them have Korean names on them - Daewoo, Ssangyong, and Hyundai. At least so far, the US trade representative's memorandum of understanding hasn't resulted in any noticeable increase of US-made vehicles on Korean roads.

But it certainly has boosted fuel use. Overall, Korea's calendar year 2000 crude oil imports were up almost 37% over 1999 levels. Even though Korea's economy wasn't exactly hitting on all cylinders, oil use for transportation increased nearly another 5% in 2002. It's tough to see how a nation which imports virtually all of its petroleum, and which has the city (Seoul) with some of the world's dirtiest air, can keep on this way much longer.

The government has raised taxes on LPG and Diesel fuel in an effort to reduce demand, and they say they plan to keep pushing them up. Unfortunately, fuel price hikes affect everybody. The progressive taxes on large vehicles, repealed in 1999 at American behest, mostly hit the wealthy. So it goes; as Korea's air gets dirtier, roads get clogged, and the gap between rich and poor continues to widen.