This research endeavors to show the centrality of party politics in corporate restructuring in Korea. Its main argument is that the commitment capacity of political parties is not strong enough to manage the conflicts between employers and unions in the labor relations whereas the threat capacity of them is powerful enough to frustrate the reform efforts of the state policymakers in the lawmaking arena. This shaky intermediate institutional equilibrium of party politics of the Korean variety of capitalism shapes the coherency of reform policy coordination of the state, which also shapes the corporate restructuring outcomes. The coordinating capacities of the state policymakers in corporate restructuring should be considered in terms of the interactions among those of political parties and of labor market players that jointly influence institutional reform outcomes.