North Korea is rattling its sabers again. Or perhaps that metallic clinking is actually the sound of two piggy banks, shaking in stereo.
North Korean officials have made noises for over a month about the looming possibility of a missile test, in defiance of the U.N. Security Council. Foreign diplomats in Pyongyang and tourists in South Korea have been warned that their safety could be at risk due to the possibility of war. Last Thursday, North Korea claimed it had “powerful striking means” on standby for a missile launch, which drew censure from the G8 nations, as well as others in the international community.
This rhetoric is presumably aimed at South Korea and its ally, the United States - which is to say, more or less business as usual in the North. But I suspect Kim Jong Un has an additional target in mind this time: China.
North Korea habitually creates crises in order to extract food aid and other concessions from South Korea and the United States. Back in 2009, I wrote about Kim Jong Il’s preparations for a missile launch of his own, with this as one of his aims. There is no reason to doubt that it is also a principal objective for his son, who took power last year after Kim Jong Il’s death. Kim Jong Un also needs to maximize his credibility with the country’s military, which, along with Pyongyang’s extensive terror apparatus, keeps the Kim dynasty in power.
But I think, this time, Kim’s brinksmanship may target Beijing as much as, or even more than, Seoul or Washington. Sure, the Chinese are deeply frustrated with their North Korean clients. But they don’t want the North to collapse, either - both because it might send a flood of refugees China’s way and because, more importantly, it would put a unified, democratic, U.S.-allied South Korea right on China’s border.
If you want evidence that China remains committed to sustaining the Kim regime, consider: Openly speaking out against North Korea is still enough to lose a Chinese journalist his job within 48 hours.
North Korea owes its existence directly to China. Chinese troops saved North Korea from losing the Korean War in the early 1950s. Chinese trade and energy supplies have kept it in business through decades of gross economic mismanagement. Aid from South Korea and the rest of the international community has merely topped up the North’s tank.
The recent shift in relations may result largely from the fact that China has become wealthy, especially by North Korean standards. It’s like giving Kim a second piggy bank to shake. Kim probably figures if he shakes it hard enough, the Chinese to his north will quietly provide whatever payoff he fails to secure from the south. He has no reason to care which direction the money flows, as long as it’s toward him.
One thing that will not happen, under any conceivable circumstances, is North Korea’s voluntary surrender of its missile and nuclear weapons programs. No amount of sanctions will make it do this, especially because China is not prepared to see Pyongyang fall. After watching events in Syria, Libya, Iran and Iraq, Kim can rightly conclude that abhorrent dictators who lack nuclear arms are subject to regime change, while those in possession of such arms are not. The U.S.-led policy of sanctioning Pyongyang into giving up its weapons programs has accomplished nothing, nor will it.
There are only three conceivable courses of action for living with a nuclear North Korea: hoping that the regime will rot or be toppled from within; defeating it by force in a conflict that will go from horrific to unimaginable if China doesn’t stay out; or waiting for the Chinese to decide that they are not willing to be blackmailed into bankrolling the Kims indefinitely. The last option is the most desirable, but it is hard to envision before China itself evolves into a society more similar to South Korea’s. That change is not inconceivable, but it won’t happen quickly.
In the meantime, we can expect Kim to shake both piggy banks as hard as he can whenever he needs some coin.
Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s recently updated book,
Looking Ahead: Life, Family, Wealth and Business After 55. His contributions include Chapter 1, “Looking Ahead When Youth Is Behind Us,” and Chapter 4, “The Family Business.” Larry was also among the authors of the firm’s book
The High Achiever’s Guide To Wealth.
Posted by Larry M. Elkin, CPA, CFP®
North Korea is rattling its sabers again. Or perhaps that metallic clinking is actually the sound of two piggy banks, shaking in stereo.
North Korean officials have made noises for over a month about the looming possibility of a missile test, in defiance of the U.N. Security Council. Foreign diplomats in Pyongyang and tourists in South Korea have been warned that their safety could be at risk due to the possibility of war. Last Thursday, North Korea claimed it had “powerful striking means” on standby for a missile launch, which drew censure from the G8 nations, as well as others in the international community.
This rhetoric is presumably aimed at South Korea and its ally, the United States - which is to say, more or less business as usual in the North. But I suspect Kim Jong Un has an additional target in mind this time: China.
North Korea habitually creates crises in order to extract food aid and other concessions from South Korea and the United States. Back in 2009, I wrote about Kim Jong Il’s preparations for a missile launch of his own, with this as one of his aims. There is no reason to doubt that it is also a principal objective for his son, who took power last year after Kim Jong Il’s death. Kim Jong Un also needs to maximize his credibility with the country’s military, which, along with Pyongyang’s extensive terror apparatus, keeps the Kim dynasty in power.
But I think, this time, Kim’s brinksmanship may target Beijing as much as, or even more than, Seoul or Washington. Sure, the Chinese are deeply frustrated with their North Korean clients. But they don’t want the North to collapse, either - both because it might send a flood of refugees China’s way and because, more importantly, it would put a unified, democratic, U.S.-allied South Korea right on China’s border.
If you want evidence that China remains committed to sustaining the Kim regime, consider: Openly speaking out against North Korea is still enough to lose a Chinese journalist his job within 48 hours.
North Korea owes its existence directly to China. Chinese troops saved North Korea from losing the Korean War in the early 1950s. Chinese trade and energy supplies have kept it in business through decades of gross economic mismanagement. Aid from South Korea and the rest of the international community has merely topped up the North’s tank.
The recent shift in relations may result largely from the fact that China has become wealthy, especially by North Korean standards. It’s like giving Kim a second piggy bank to shake. Kim probably figures if he shakes it hard enough, the Chinese to his north will quietly provide whatever payoff he fails to secure from the south. He has no reason to care which direction the money flows, as long as it’s toward him.
One thing that will not happen, under any conceivable circumstances, is North Korea’s voluntary surrender of its missile and nuclear weapons programs. No amount of sanctions will make it do this, especially because China is not prepared to see Pyongyang fall. After watching events in Syria, Libya, Iran and Iraq, Kim can rightly conclude that abhorrent dictators who lack nuclear arms are subject to regime change, while those in possession of such arms are not. The U.S.-led policy of sanctioning Pyongyang into giving up its weapons programs has accomplished nothing, nor will it.
There are only three conceivable courses of action for living with a nuclear North Korea: hoping that the regime will rot or be toppled from within; defeating it by force in a conflict that will go from horrific to unimaginable if China doesn’t stay out; or waiting for the Chinese to decide that they are not willing to be blackmailed into bankrolling the Kims indefinitely. The last option is the most desirable, but it is hard to envision before China itself evolves into a society more similar to South Korea’s. That change is not inconceivable, but it won’t happen quickly.
In the meantime, we can expect Kim to shake both piggy banks as hard as he can whenever he needs some coin.
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