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January 5, 2012

Not His Father’s North Korea

by Mike M

So North Korea-watchers are now offering a kaleidoscope of opinion about whether the succession from Kim Jong-il to his son, Kim Jong-un, will work as planned.  Many factors will bear on the result:  The younger Kim is not well known by North Koreans; the succession could set off a power struggle; China might annex the place.  But the most important fact may be the least appreciated:  Kim Jong-un is not inheriting the state his father did, in 1994.  North Korea has evolved into a different place, with altered expectations and psychological dynamics.  How the younger Kim and his advisors respond—reform and open up, clamp down tighter, muddle through—will be the most elemental choice any North Korean rulers have had to make since 1945.  And tied up with their choice is a parallel strategic decision for us:  How we use an intertwined set of social, economic, and cultural changes in a closed regime to our advantage.

Even amid provocations and crisis, economics now holds center stage in North Korea.  Pyongyang has vowed that 2012 would be the year of a “strong and prosperous nation,” and has thrown itself into hundreds of construction and development projects to project an image of growth and prosperity.  In its public statements of recent years, the regime effectively admitted that its legitimacy is tied to delivering an improved standard of living.  Its New Year’s message of 2012 (“Happy New Year!  Have another bicycle”) stressed continuity with the Kim Jong-il period, and laid a notable stress on development and progress.

To address these expectations, the North’s latest 10-year economic plan had already highlighted international economic ventures, special economic zones and foreign investment.  Pyongyang is pouring resources into state-owned enterprises and welcoming odd bedfellows—Christian missionaries and South Korean scholars, for example, as partners in the new Pyongyang University of Science and Technology (PUST).  This highly militarized state boasts small army of computer animators who have done work on several films, including Western hits like The Lion King; a South Korean investor has been making money with fried chicken joints.

Since the calamity of the 1990s famines and the collapse of the Public Distribution System (surely a key signpost in the loss of legitimacy of any communist system), the regime has had to tolerate the massive growth in markets and a “merchant class” of what we would generally think of as entrepreneurs.  North Koreans now rely on these markets—public, private, official and illicit—for basic survival.  One senior defector now living in Seoul told me a year ago that “eighty percent of North Koreans now depend on their own initiative” to get enough food, through black markets and the limited public markets tolerated by the government.  Some traders began to enrich themselves, hire staff, become quasi-capitalists.

Yet Pyongyang also knows the perils of too much marketization.  The most persuasive narratives, in fact, to confusion and lack of vision in Pyongyang—a regime without any coherent economic plan, veering from one idea to another:  inviting foreign investment while cracking down on markets, speaking of high-technology while launching new waves of security-service repression.  The regime was already doing its best to harness and, where it could, counteract these trends, including crackdowns on smuggling and corruption investigations.

Meantime, with the growth of markets has come a sea change in the awareness of the population.  Nearly all have seen South Korean DVDs, viewed clips on smuggled memory sticks, listened to outside radio, heard about life in the South.  “The North Korea is today is not the North Korea of the late 1990s—it is a different country,” one defector told me in Seoul.  And as so often happens in autocratic societies where the first cracks of choice begin to open up, corruption blooms; members of the security services, for example, appear to use their positions as much to squeeze bribes as to enforce rules.

Kim Jong-un and those presumed to be advising him are thus coming to power at the most delicate moment of North Korea’s history.  The history of similar regimes suggests that the fundamental dilemma may be irresolvable:  If they veer toward large-scale reform, they will begin an inevitable process of destabilization; if they crack down on markets and push back against investment, they consign themselves to a slow social asphyxiation.

A fascinating comparison is provided by Cuba, which, while not nearly as far up the reform stairway as, say, China or Vietnam, is many steps ahead of North Korea.  Read a little into Havana’s recent decisions—massive layoffs from state enterprises, legalization of hundreds of forms of small businesses, further steps to boost a massive tourist industry—and you see how far North Korea has yet to go.  But the basic path is the same.  And in a brilliant essay on the Cuban experience,* Eusebio Mujal-Leon, a respected Latin Americanist at Georgetown, recognizes the key point:  “The East European cases also suggest that there is a ‘tipping point’ at which the level of economic development, civic organization, and the emergence of a political alternative coincide.”  You can bet the old men in Pyongyang—as well as Havana and, in their way, Beijing—are trying desperately to discover, and avoid, that point.

But what should our policy be toward the prospect of such a decisive moment, and the potential to encourage it?  Kim Jong-un and his people have their dilemmas, but we also have ours.  We want to demand denuclearization, but we don’t want to push a dangerous regime too hard; we want to invest in change, but we fear that any engagement benefits the regime; we (and especially South Korea) want to promote a new order, but fear what we might get.  In their honest moments over drinks, many South Koreans say of course they want North Koreans freed–but “unification” doesn’t really excite them, with its risks and costs.

To get a sense of our strategy’s wall-butting moments, try this fun trick:  Type the phrase “North Korea must not be allowed” into Google, and behold the dismal parade.  A few highlights:

2003:  Tony Blair says they must not be allowed to … develop nuclear weapons.

2003:  Nonproliferation exports at a Brookings conference insist they must be stopped from … becoming an exporter of nuclear technology (some years before the Syria debacle).

2009:  Heritage Foundation says they must not be allowed … drag out the 6PT indefinitely.

2010:  Japanese Foreign Minister says we can’t allow them to … get away with “two armed attacks against the South in the space of eight months” (the Cheonan and island shelling incidents).  How are we doing on that one?

“We will not stand idly by as North Korea builds the capability to wreak destruction on any target in Asia — or on us,” former Defense Secretary Robert Gates told a regional defense meeting in Singapore in May 2009 in a typical spurt of rhetoric.  Yet apart from some largely ineffectual sanctions, we have done precisely that.  And now come reports that North Korea is developing road-mobile intercontinental missiles.

Meanwhile, raise your hand if you think denuclearization talks hold any potential for a true resolution of the nuclear issue.  Now–the four people who still have any faith in negotiations, you can put them down again.  (And oh, about the “deal” on tap before Kim Jong-il died—some food aid for a “suspension” of uranium enrichment?  A good thing, surely, but nothing approaching resolution.)    We didn’t do our denuke policy a lot of favors, either, by bombing out of power the one guy (Gaddafi) who took our “test offer” and gave up his WMDs in exchange for … a horrific, defiling assassination.

One analyst I spoke to in Seoul put the lesson of all of this clearly a full year ago:  “There are changes coming.  Either we shape them proactively to our advantage, or we risk much more severe consequences.”  Taking advantage of North Korea’s new realities might mean, among other things, doing what we can to further strengthen the emerging trading class against the state structure—promoting society-changing direct investment, making new efforts to build human capital through training and education programs, and accelerating awareness of the outside world.

In a thoughtful op-ed for a Korean daily, Professor Robert Fouser of the esteemed Seoul National University makes a persuasive case for “taking the long view” and remembering that political change follows economic development and its sociological effects.  “Political change in North Korea will come,” he suggests, “after further development of the merchant class and increased contact with the outside world.  Such developments will stir thoughts of alternatives to the status quo that will eventually gravitate to a facilitated alternative.  Changes in the 2000s have planted the seeds for such change, but the seeds have yet to germinate.”

Now, such forecasts can disappear into the smoke of a sudden Pyongyang Spring; but this seems about as right as prognostication can hope to be—right enough, anyway, to justify some new policy initiatives designed to accelerate the growth of North Korea’s merchant class.  It’s the strategic principle behind our approach to China, isn’t it?

For the time being, however, U.S. policy remains fixated on nuclear weapons.  And so we have remained hunkered down, waiting for the North to come through on denuclearization—now exceedingly unlikely—but otherwise lacking initiatives.  Our time to develop a revised strategy may be running short, and the North’s appetite for outside engagement while it passes through a perilous transition may be limited.  We may not have too many more bites at this apple before it goes truly rotten.

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