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Changes in North Korea: For Better or Worse?

02 November 2012

A recent New York Times article on change in North Korea under Kim Jong Un emphasized a lack of progress for the majority. The facts cited in the article were most likely true, with the usual caveat concerning any information about that country. Many important observations were also made, such as spiking prices, the emergence of speculators, growing disappointment, efforts by the government to earn hard currency, bribery, disgust over inequality, and an increasingly realistic self-assessment (“I thought our country lived well,” she said, “but I was mistaken.”). But when it comes to interpreting these observations, we should be careful and avoid being one-sided.

To begin with, I find it hypocritical to imply that Kim Jong Un even theoretically had the chance to significantly improve the lives of a large number of his people within just ten months, and after having inherited such a big mess. In fact, it is quite surprising that he has been able to do anything at all. Most experts expected that he would be busy consolidating his power for at least a year or more; some even wondered whether he would remain in charge at all.

Furthermore, I find it difficult to understand why anybody would assume that with severely limited resources, Kim Jong Un would try to benefit everybody equally and simultaneously. Think about Deng Xiaoping’s “two speeds.” Faced with limited funds, politicians everywhere turn to their own constituencies first; I would have no difficulty coming up with a few examples from our Western democracies. To be sure, this is not fair; even less so in a country where the physical survival of the less favored groups is at stake. But my point is that this kind of asymmetrical attention is neither surprising, nor is it unique. Is self-righteousness justified here?

I also find it questionable that a leading newspaper in a liberal democracy that has millions of opponents to universal healthcare seems to imply that elsewhere, reforms towards a market economy will and should benefit everybody equally. One does not need to be a Nobel laureate to understand that market-oriented reforms of a hitherto egalitarian society lead to inequality. I don’t even want to start talking about the levels of disparity in Western countries—the US would be rather high up on that list—but even here in highly egalitarian Austria we have the rich, the middle class, and the poor. Of course the level of poverty is not even remotely comparable, but criticizing inequality in North Korea per se is a weak argument.

In fact, as odd as it may sound: shouldn’t we regard growing inequality in North Korea as a sign of progress in reform? The country needs to get out of its low-level equilibrium trap, and speeds in doing so will differ. A growing income and welfare gap between individuals indicates that the economy is on the move. The same is true for rising prices. Not only do the prices in the DPRK explode regularly, they actually swing up and down. And the allegedly socialist government lets that happen!

The extent of price variations is massive, and the resulting insecurity especially among the weaker parts of society is enormous. In addition to the political fallout of such events, shouldn’t we note that this is already proof of change towards economic liberalization? For decades, prices in North Korea were carved in stone, precisely because the leadership was afraid of inflation and price instability. This has obviously been given up, allowing producers to benefit at the expense of consumers. Doing so in a seller’s market is dangerous and causes inflation. But it is a necessary step if prices are supposed to reflect scarcity levels and to provide incentives to producers to increase their output.

The negative voices cited in the New York Times article in many ways add to my optimism about development in the DPRK. These people have gone abroad legally. More North Koreans are thus able to see what the outside world looks like, will compare this to what they have at home, and draw their own conclusions. Secondly, these people are ready to talk, even with Western journalists. This, in combination with the fact that they are Christians and expressive about it, would in past years have made the whole interview a bit suspicious. But provided these people and their stories are real, this lack of (or at least lessened) fear is another hopeful sign. Third, the very fact that people are unhappy, feel left behind, and are speaking up against their leadership is remarkable. The changes that started after Kim Jong Il took power in 1994 have slowly but steadily eroded the stability of a society where many people were poor, but equally so, silent, and without much of hope for an alternative.

Finally, the interviewees in the New York Times article make it very clear that the North Koreans have high expectations of the new leader. This is as much as we could possibly expect so far, and it corresponds with my own observations during two trips to the DPRK this year in April and September, compared to the many visits I have made to the country since 1991. With his verbal and non-verbal announcements, Kim Jong Un has created high expectations. This will now force him to act.

Nobody knows whether Kim Jong Un wants to reform North Korea. But do his intentions matter? Having created the above mentioned facts, he will reform, because he has to improve the living conditions of his people to maintain his legitimacy. He will be careful not to annoy the top and lower ranking elite who form the basis for his power and could constitute the biggest threat to him. He will follow a policy of unbalanced growth as his resources are limited, meaning that certain groups in society, the major cities, and key industries will benefit first. Kim Jong Un will reach out to the world market to increase income from trade and reduce his dependency on China. While doing all that, he will try to avoid a major disruption, knowing that to the south and across the Pacific there are economic, political, and military giants who would be ready to exploit any weakness on his side. He knows that the Chinese were able to do that trick, i.e. to reform their economy gradually without instantly losing political power. He also knows that the East Europeans failed miserably in a similar endeavor. More recently, he will have drawn his conclusions from developments in northern Africa and the Near/Middle East.

Serious concerns remain: the nuclear program, massive human rights violations and starvation. Many North Koreans can only dream about the increasingly luxurious life in Pyongyang, which so far remains the exception and in many regards a facade, even though some improvements seem to be trickling down. In particular, the remote areas to the north and northeast, and even the breadbasket regions south of the capital, according to the World Food Program, suffer from serious shortages of essential goods. All this and more is true and should be repeated on every occasion. But it is not the full story. We need a more balanced assessment of the situation that goes beyond listing the many obvious deficiencies and inequalities. Trying to belittle positive developments and focusing on the weaknesses of North Korea is not an objective assessment either. It will not improve our understanding of that country, and it will not benefit its people.


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7 Responses to “Changes in North Korea: For Better or Worse?”

  1. […] Frank, Ruediger, “Changes in North Korea: For Better or Worse?”, 38 North, 02 November 2… […]

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  3. Rudiger Frank says:

    Realist Writer correctly points at the key dilemma in dealing with North Korea. If we support economic development there, we risk helping to fund the nuclear program and to extend the lifespan of the regime. But if we refuse to trade and invest, we risk severe economic hardship that will hit the weak parts of the population first, and provide a rationale for the Pyongyang leadership’s hardline policy. Frankly, I do not see how this dilemma can be resolved other than by a political decision. I vote for engagement, and am aware that this approach is not risk-free. But neither is confrontation.

  4. Realist Writer says:

    Leonid and Fred seems to think that reform has something to do with peace with South Korea. Fred views peace as a signal of reform, while Leonid thinks peace is a prerequisite for reform.

    But all this talk for peace obscures two basic facts.

    First, the North Korean regime relies on having a strong military, to protect from both internal and external threats.

    Second, economic reform would lead to a booming economy, which would then be used to further fund the North Korean military and ensure its effectiveness on the battlefield. A strong economy will ultimately mean a strong military.

    Therefore, reform has nothing to do with peace. In fact, if reform is successful, North Korea would not NEED peace. It can just crush all potential opponents. A strong, prosperous nation needs not to compromise with anyone. It’s only a weak nation that have to rely on food aid from the West and foreign aid from China.

  5. Fred says:

    Kim Jong Eun has only had a few opportunities to show whether or not he intends reform, granted.

    He has thrown away those opportunities. On the economic front, the border with China is now more tightly controlled than before. On the military front, there have been repeated and highly specific threats to the ROK.

    If he intends change, he’s off to a terrible start.

  6. N_aTe says:

    Your article offers great insight into the dynamics is faced with–of a very, very young leader–indebted literally, physically, and spiritually to so many millions who have made every day life into something that matters for their children for so many years, above and beyond what they cannot control–“they/the children/parents” have “scraped-up” for years, and “they” will continue to do so because it matters to “them”, their livelihood which equals their children’s advancement. “They” understand that/sacrifice in daily income. It is purist

    I use open-sources to convince


    It is the fear-of reprisal in the most hated-terms be it gulags with a long-death, that stymies “their” articulation-of simply wanting a better-life for their children. It is the un-documented story of just how well “South” Koreans raise their children/offspring to ensure “they” embrace that which enables a better life for “them”.

    The average North Korean understands making it better for their offspring. The mirror he or she looks-to everyday has two-sides: a China that is increasingly acknowledging How does he make it better while not being consumed in the process. That is the real struggle for

  7. KJU does not have any legitimacy to rule the country, and he knows that. Therefore, all his power is based on terror, not on benevolence. His intentions are focused on keeping the elites happy but fearful of being demoted to the rank of unpriviledged. Hence the “two speeds” – one for the trusted, and one for everyone else. This is what was in NK since the late 1950s and KJU simply continues the line of his gandfather and father. Don’t expect any reform from him until the Korean War is over, inter-Korean contest for legitimacy is resolved, and diplomatic recognition of DPRK by the US is secured. Then NK might reform only to realise that the Kims’ rule was a mistake. Then why would KJU bother himself with such experiment?

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Credit for photo of young North Korean girl: T.M. All rights reserved, used with permission.