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Welcome home, Jun Young Su aka Eddie Jun. The Korean-American businessman and pastor reportedly confessed to spreading Christianity, a crime in North Korea. Major kudos to Ambassador Bob King, with KCNA crediting evangelist Franklin Graham, whose mother Ruth Bell Graham grew up in Pyongyang, and whose father, the legendary Billy Graham, was a confidant of Kim Il-sung, with an assist. King denied that there was any quid pro quo in terms of food aid, but suppose for a moment there were. Might it not be worthwhile to ransom some prisoners out of the North Korean gulag for bags of corn?
In the meantime, Kim Jong-il was chugging around China, presumably seeking Chinese blessings for the politically progressive concept of dynastic succession and aid. The Chinese have played up statements that could be interpreted as recognizing the need for reform, but critically, the North Korean media has been more circumspect, and as the recently leaked UN report documents, the military’s illicit activities are deeply embedded in the economy. Some in the commentariat have seized on his visits to high tech factories, but this kind of technological Great Leap Forward is a staple of communist autocrats seemingly oblivious to the systemic problems that they face. A true story: the Moynihan reforms require that US government intelligence agencies devote part of their budgets to hiring outside consultants to discourage group-think within these agencies. In 2001, after Kim Jong-il visited Shanghai, an interagency group convened a gathering of outsiders to solicit our reactions. After seeing the skyscrapers of Pudong, Kim Jong-il reputedly told his subordinates that he wanted the same for North Korea, and one of the US government people asked me about this incident. I responded that my training was in economics, not psychiatry, so when Kim Jong-il turned to his generals and said “I want this for North Korea” I did not know if he meant a center of financial intermediation or a nice collection of tall buildings. Everyone laughed. A few weeks later I was walking down Connecticut Avenue and bumped into a senior official. “I know I should not be telling you this,” he began, “but we intercepted a communication from Pyongyang to their embassy in Canberra in which the embassy is instructed to find out if the Australian aid money can be used to hire commercial architects. You were right--they wanted big buildings!” A few weeks after that an official from Australia’s Office of National Assessments (their equivalent to the CIA) dropped by my office. “We had the strangest experience recently,” he started, “you know when we normalized relations we budgeted some aid. Being Australia, in light of North Korea’s food problems, we thought that we would use it on agronomy. But they came in and asked if the money could be reallocated for the hiring of architects specializing in large commercial structures.” Sorry, New York Times: been there, done that.
Our buddy in Seoul, the International Crisis Group’s Dan Pinkston, who is surely superior to other retired USAF Staff Sergeants, flagged an interesting piece indicating that the North Korean government is not the only one on the peninsula with a penchant for regulation. Starting next year, people in South Korea who want to send remittances to friends or family in North Korea will have to obtain advanced approval. The Unification Ministry indicated that this policy was being undertaken to improve transparency in inter-Korean exchanges.
Dan also flagged the ongoing expansion of activities at the Kaesong Industrial Complex, where output hit an all-time high in March, and employment is now 46,000—despite the sanctions imposed by the South Korean government following the sinking of the Cheonan. One close observer has described KIC as “corporate welfare for labor-intensive South Korean firms: infrastructure financing, subsidized or guaranteed bank lending to entrants, malfeasance on guaranteed loans…” Steph Haggard and I have done a survey of South Korea firms operating in North Korea, including KIC. We will begin publishing analysis from this survey over the course of year. And then there is the North Korean labor side of the story. We have some data from our survey, but as Steph has observed, “what we don't know about--and won't for some time--is the social psychology of the employees. They must be learning something about how contemporary Fordist firms works, anyway. And unless they are deaf, dumb and blind they must also see the huge gap between North Korean and South Korean capabilities. Talk about a project: wouldn't you love to survey them?”
We’ve been writing a lot about sanctions recently, but we could not help but give a shout out to Chung Dongkwon of Kukmin Daily, a journalist who has actually does research and does not just solicit comments from windbags like us. His work suggests that when it comes to sanctions implementation, the Chinese Emperor has no clothes. [In Korean].
Another one of our obsessions is cyber-warfare. Yonhap reports that South Korea is boosting its defenses.
Finally, speaking of gassed-out windbags, retired CNN interview-meister Larry King told an audience in Seoul that he wants to land a gig with Kim Jong-il because he’s interested in hearing from "people who are perceived as evil by the world... They don't think they’re different and they don't look in the mirror and say I'm evil and I'm bad," the Chosun Ilbo reported. "They have their own point of view and I'm fascinated by how they've got their point of view... I want to ask why they rule North Korea the way they do, and what they are worried about. Do they think someone is going to attack them and what motivates them." Personally, I would have stopped at Janet Jackson.
