Under the Loving Care of the Fatherly Leader: North Korea and the Kim Dynasty (133 page)

The South Korean government’s theory-was that a sense of vulnerability had spurred Pyongyang to build nuclear weapons. Certainly it was not some inexplicable case of paranoia that led Kim Jong-il and his colleagues to worry that they might be attacked. North Koreans had been “staring down
the barrel of American nuclear weapons for decades,” said arms control expert Peter Hayes. “Indeed, it is a large part of the explanation of why they have built a subterranean society.”
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In 1998 journalist Richard Halloran reported that United States and South Korean forces had replaced their Korean peninsula war plan. The old plan had called for simply repelling any North Korean invasion of the South, pushing North Korean forces back behind the Demilitarized Zone. The new plan was far more ambitious, and included the possibility of preemptive strikes if the U.S. and South Korean presidents should agree that war was imminent. Americans and South Koreans would invade the North to capture Pyongyang, wipe out the regime and its military and place the country under South Korean control. Halloran quoted a senior American official as saying, “When we’re done, they will not be able to mount any military activity of any kind. We will kill them all.” One officer told Halloran that the plan responded to concerns that the North Koreans, contemplating the evidence that their force was deteriorating, might decide they had to “use it or lose it.”
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The new plan and the tough talk accompanying it obviously could be sobering to Kim Jong-il and perhaps could deter him from any such adventure. No doubt that was part of the intention. In 2003 Halloran reported further details of what was officially called Operation Plan 5027. “The North Koreans are believed to know the general outline of plan 5027,” he wrote, suggesting that the plan was “a factor in North Korea’s latest threats and its desire for a nonaggression pact with the United States.
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While South Korea’s military worked with the Pentagon on the new plan, civilian officials in Seoul were taking a separate tack. They believed that a successful shift to economic interdependence with the outside world would lessen Pyongyang’s feelings of insecurity (as well as its shortage of hard currency) and facilitate a solution to the problem of weapons of mass destruction. Indeed, the Southern unification minister in October 2003 agreed with Pyongyang’s claim that Kim Jong-il’s “military-first” policy could actually be seen in part as a bid to make the economy more efficient.
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How in the world could that be? German scholar Ruediger Frank explained how, in a provocative essay
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Frank said that the military-first policy was methodically removing the socialist elements of the country’s ideology, leaving the nationalist elements intact. He quoted the party newspaper
Nodong Shinmun
as saying on March 21, 2003, that the policy—now called the “military-first ideology”—raised the military above the working class. That quite explicitly meant jettisoning Karl Marx’s mid-nineteenth-century
Communist Manifesto,
as the newspaper signaled in an April 3 article: “In the past, it was recognized as an unbreakable formula in socialist politics to put forth the working class. However, the theory and formula … generated one and a half centuries ago cannot be applicable to today’s reality.”

Determining people’s status according to their relationships with the
military instead of their economic class would permit granting legitimacy to North Korea’s new moneyed class, Frank argued. The argument was interesting. After all, as chapter 33 of this book makes clear, many of the new traders had emerged from the military and quite a few of their companies were tied to the army or other military organizations such as bodyguards and police. It could be a relatively small matter to decree that the rest of the enterprises belonged to the military-industrial complex. In any case Kim Jong-il, as Frank wrote, would not have to “force the group of entrepreneurs, who will very likely emerge as one of the results of successful economic reforms, into an obviously anachronistic ideological and propagandistic corset.”

Kim had displayed “exceptional foresight to deal with this issue now, in this early stage of economic reforms,” the scholar wrote. “The working class loses its position as the leading group in the North Korean society. Without the working class, what happens to socialism and its final stage, communism? Very simple: they are gone, although this is not openly admitted in North Korea yet.” The replacement? “There is a simple answer to that, too, and we call it nationalism, also known
as juche,”
Frank wrote. “The transition will be smooth, because already since its introduction in 1955
juche
began to gradually replace Soviet-style socialism in North Korea anyway.”

Frank was right to say that nationalism should be seen as the core of
juche.
Korean self-reliance was only one component and, as we have seen from Kim Jong-il’s conversation with Chongryon officials in 1998, the Dear Leader had come to believe that the self-reliant component had been overemphasized to the detriment of the economy.

There was more to Frank’s analysis of how “military-first” fit with economic reform. The military wanted modern weapons, but the country could not afford them. “Where does the money come from? Economic reforms.”

By early 2004 the accumulation of ideological and practical measures had reached something of a critical mass, persuading quite a few longtime skeptics that Kim Jong-il probably-was serious about change. Although I had not managed to receive permission to visit the country since 2000, a tally of-what others were finding finally persuaded me. Journalist Hideko Takayama heard from a Japanese investor who recently had renewed a repeated entreaty to his North Korean joint-venture partner to please turn off the propaganda announcements that blared incessantly in their processed seafood plant. Instead of huffily refusing, as before, the partner silenced the loudspeakers. He explained by saying, “Politics is now separate from economics.” Mean-while,
Newsweek International
reported, videotapes of South Korean soap operas were for sale in North Korean markets and Pyeonghwa Motors had rented billboard space in the capital to advertise its locally made Fiat sedan, the Huiparam (-whistle).
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Stanford scholar John W. Lewis (whose lectures on arms control I had attended in 1983) found “dramatic” changes on his ninth visit to the country since 1987. “The real shocker-was the massive semi-private market in Pyongyang where potential buyers can find quantities of meat, vegetables and fruits as well as hardware, furniture and clothes,” Lewis reported. “A market economy however limited, has arrived in the North.”
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For years the regime had vociferously refused to commit to the model of China or any of the other communist countries that had changed course. Finally though,
Newsweek International
reported, some officials acknowledged to South Korean counterparts that their model was Hungary’s 1970s experiment in grafting market measures onto the basic state planning structure.
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Indeed, many of the measures adopted in North Korea between 1998 and 2004 were similar to the Hungarian “goulash communism,” as it had been called back then because of its stew-like mixture of market and central planning measures.

To the extent that naming the model provided an affirmative answer to the question of whether Pyongyang was contemplating some sort of market economy, the news was encouraging. And yet the Hungary of the 1970s seemed a curious model for Pyongyang to have chosen. There had been many problems with Hungary’s reforms in that period. The long-entrenched bureaucracy had dragged its feet, forcing reversal of many of the new measures until a second wave of reforms began in 1978. Perhaps an attempt to avoid that trap was behind a reported order by Kim Jong-il to downsize the North Korean party and state bureaucracy—by as much as an astonishing 30 percent.
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(Of course the Hungarian economy required further drastic changes, starting in 1989–90 with the full retreat from communism.)

China and Vietnam had been the models often proposed by outsiders. But economist Marcus Noland observed that neither of those Asian countries would be a good fit—because both started the process as predominantly rural economies, able to use the rationalization of inefficient agriculture to drive industrial development.
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North Korea, like Hungary, started its reforms as an already industrialized country. To free up enough surplus labor to staff all the new non-state enterprises that Pyongyang wanted to see built would require downsizing not only the bureaucracy but also the bloated military. That peace dividend would be available if the North could end its military standoff-with the United States and South Korea—or, as Kim Jong-il evidently had calculated alternatively, if it built its nuclear arsenal into a credible enough deterrent to compensate for slashing its conventional forces.

Further probing into the reasons for choosing the Hungarian model, we could guess that at least one top North Korean planner was an alumnus of a Hungarian university. We might also speculate that the supposed Hungarian model was to some extent a proxy for a real model much closer to home, a model that could not be publicly identified without thereby branding as lies
the propaganda that had gushed forth from Pyongyang for decades. South Korea, while under military dictatorship in the 1970s and 1980s, had very successfully combined broad central planning with market decisions.

While recognizing that Kim Jong-il had spent much of his career pounding down every would-be Deng Xiaoping who popped up, South Korean officials evidently believed that no one was beyond salvation. An ideologically born-again Kim himself could be seen as the prospective Deng for his country if he got the right encouragement.
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And so the South tried to help, although still cautiously. South Korea was moving ahead of Japan and China in the value of total imports from North Korea. The South’s imports from the North in the first ten months of 2003 were up almost 30 percent over the same period a year earlier.
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Plans were afoot to rebuild roads and railways across the border.

If Kim Jong-il really was serious about changing course, what would explain ?why it was happening at this particular time and “why it had taken him so long? Many of the factors have been discussed above. Others are summarized in the table below. My then-and-now comparisons suggested that even if Kim Jong-il had been eager to reform the country much earlier, the country might not have been ready and other conditions also would have been unfavorable.

How “would that inference fit with what we thought we knew about Kim Jong-il? Had he lain in wait for decades, intending to play the reformer as soon as conditions might permit? The available evidence indicated that from his student days in the 1950s through the 1980s and early 1990s Kim had been—if not always a sincere opponent of significantly changing the system his father had built—at best a cautious opportunist. If he was ready for far-reaching change now, I thought, it was because of overwhelming circumstances—many of them the same circumstances that had changed the minds of other people similarly raised in North Korea to be true believers.

CHANGED CONDITIONS POSSIBLY AFFECTING PROSPECTS FOR SYSTEM REFORM