Asia Times: PYONGYANG WATCH: Guerilla economics: Why self-reliance doesn't add up


	February 21, 2001	atimes.com

The Koreas

PYONGYANG WATCH
Guerrilla economics: Why self-reliance doesn't add up
By Aidan Foster-Carter

"Self-reliance" is one of North Korea's most oft-repeated slogans and claims. It's one translation, if a rather loose one, for Pyongyang's guiding ideology of juche. A more elaborate version, which visitors to the Diamond Mountains (Kumgangsan) wince to see carved into the hillside in huge red characters, proclaims chaju, chalip, chawi: self-reliance in general, in economics, and in defense. This relentless cha-cha-cha - shall we dance? - is clearly a big deal. But like many things in North Korea, it shouldn't be taken at face value. Chalip in particular is either false or, where true, seriously bad news.

It never ceases to amaze me how many people, including critics, take it on trust that North Korea actually is, or ever was, a self-reliant economy. That is a downright lie, bare-faced cheek, and rank ingratitude to Kim Il-sung's Soviet and Chinese comrades - who respectively installed him in 1945 and saved his bacon in 1950-53. Both Moscow and Beijing, especially the former, pumped in huge amounts of aid. Most of North Korean industry was built or rebuilt with Soviet technology and money. Yet Pyongyang rarely said thank you, constantly defaulted on debts, and had the gall to claim innovations as its own.

Eventually Moscow tired of this. In 1991 then Soviet president Mikhael Gorbachev abruptly pulled the plug and plunged the North Korean economy into a decade-long tailspin. (Much the same happened to equally dependent Cuba.) Pyongyang glosses this as "loss of the socialist market", yet in truth it rarely delivered its side of trade deals. The real loss was of the massive aid which for decades had underpinned so-called self-reliance. Even now Pyongyang still owes Moscow up to US$5 billion, depending how you value Soviet-era roubles.

So in a cruel irony, de facto but involuntary self-reliance only dates from 1990. Typically, North Korea took its overdraft elsewhere - and is now propped up by China, crucially so but less generously. Since 1995 it has also relied on foes as well as friends. Another irony: Guess who is Asia's top recipient of US food aid? This comes mostly via the UN's World Food Program (WFP), which has its largest ever operation anywhere in the Democratic People's Republic of Korea, with no end in sight. Some self-reliance.

At the national level, then, Pyongyang's claim to economic self-reliance is plain false. Where it is more true, if no less disastrous, is at local level. Even before the crises of the 1990s, there was a trend to let provinces or even counties fend for themselves. In a revealing set of priorities, whereas heavy industry and mines came under the central planned economy, provinces had to look after their own consumer goods and social services. The state also took grain for the cities and any surplus produced by the provinces.

So much localization went against the Soviet model of a specialized national economy - with its risk of a whole vast country relying on just one plant for some crucial item. But North Korea is much smaller and too much local self-reliance also has a downside. That point is made in a new study of a hot topic, electric power, by a researcher at South Korea's Kepco, Choi Jang-eun. This offers a wealth of data. Two industrial northeastern provinces, North and South Hamgyong, use half of all the country's electricity. South Pyongan (including Pyongyang) takes 17 percent, and the army 5.6 percent (how does he know?). Around 85 percent of hydro-electric power plants remain damaged from flooding in 1995 and '96, for want of Russian or Chinese parts.

Choi also notes that a "one region, one power plant" policy increases vulnerability to natural disasters. I'd add that the much-hyped recent drive to build many local mini-power plants smacks of second-best, if not desperation. Despite a nationwide campaign, the terrain won't be suitable everywhere. Winter freeze must render many idle and cause damage. In a rare instance of policy debate in Pyongyang, last year officials were quoted as emphasizing the need to get back to building and mending bigger plants.

Here as often - as in the endless calls to avoid waste, collect scrap, and find hidden resources - one has a sense of guerrilla economics at work. Indeed, learning from Kim Il-sung's pre-1945 partisan exploits has long been a big propaganda theme. By definition, guerrillas have to be self-reliant. The press exalts workers who make their own tools, and those who get by without calling on the center for help. But in extremis? What if you live in a mining area, sending out coal but ceasing to get food in return? Tough, comrades. Your heroic sacrifice will shine forever. Just don't try slipping over the border into China.

For sure, North Koreans are highly resourceful (of necessity) in managing with and on next to nothing. But should they have to? Two centuries ago in The Wealth of Nations, Adam Smith, the founder of modern economics, famously explained why each of us trying to make our own pins (ouch!) was a much worse idea than creating a highly specialized division of labor: local, national, ultimately global. Capitalism thus displaced the old feudalism, mouldering along in local self-sufficiency. For North Korea to assert self-reliance at state level was flawed and false enough. To seek to impose it down to local level too is to march madly against the tide of history - back into the stone age. Make that gorilla economics.

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