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2009/01/22 10:09 KST
NORTH KOREA NEWSLETTER NO. 38 (January 22, 2009)


Prospects for North Korea's Domestic Policy in 2009

By Park Hyeong-jung
(Senior Research Fellow, Korea Institute for National Unification in Seoul)

"Revolutionary surge" was the key word in the New Year's joint editorial for 2009. Its main function was to eliminate remnants of reformist vocabulary and call for control and mobilization of catchwords back into the official language of North Korea.

   What the editorial signaled to the North Korean people was that the conservative emphasis in North Korea's domestic policy will be strengthened even more this year. As a matter of fact, the conservative turn of domestic policy, especially economic policy, already began in late 2005. The joint editorial of 2009 denotes the high tide of the conservative trend in North Korea.

   The return and escalation of conservatism has coincided with Jang Song-thaek's rehabilitation and rise since late 2005. His career in the power hierarchy shows ups and downs that appear to be related to changes in domestic policy orientation. He was one of the most powerful lieutenants of Kim Jong-il from 1994-2000 as the first-vice secretary for organization and guidance at the central party. He was, however, exiled internally during the reformist phase of 2001-2005. With his return, North Korean policies recaptured their emphasis on centralist mobilization with intensified political penetration and control from above and expanded use of resources for demonstrating political grandeur.

   Though arguably North Korean high politics belongs to the sphere of guesses and speculation, a hypothetical story line can be construed from various open source information. Jang was pushed to the back burner when Kim Jong-il felt the need in 2000 to comfort the victims of a large-scale elite purge, which had been orchestrated by Jang from 1994-2000.

   It became clear in 2001 that the wind had changed direction in North Korea. The New Year's joint editorial of 2001 mentioned the need for a "new ideological point of view," and in October, Kim Jong-il issued a major document on the principles for the July 1, 2002 reform measures.

   Kim Jong-il named two central figures for the new reformist era: Lee Jae-gang was named as an additional first-vice secretary in charge of organization and guidance of the Workers' Party in July 2001, and in September 2003, Pak Pong-ju was named as premier. At the time of his appointment, Pak was known to have been personally backed by Kim Jong-il with regard to his reformist policy. He pushed for reform even further in 2004, after Jang was purged in April 2004, presumably because of his contention on the reform measures. State firms were guaranteed more autonomy in management, and especially, the Cabinet was allowed to play a leading role in economic policy at the expense of party organizations both in the center and in localities.

   In late 2005, however, conservatives began to launch counterattacks against the reformers: in September 2005, a department for planning and finance at the central party secretariat was reestablished to intervene in economic policy; in October, restoration of state rationing of food was attempted and it was declared that foreign humanitarian assistance was no longer needed; and thereafter, the repression of market activities of individuals and firms was gradually strengthened.

   It was probably no coincidence that Jang Song-thaek was rehabilitated in December as a first-vice secretary for social organizations and the renovation of Pyongyang. Pak Pong-ju, the reformist, was finally replaced by Kim Young-il in April 2007, after he was known to have insisted on major wage reforms in favor of productivity. With his demotion, his reform concept, which linked the strengthening of the Cabinet with "improvements in economic management" at the cost of the economic intervention of the party, was brought to an end.

   Thereafter, the strengthening of the Cabinet has instead been connected only with increases in centralized and unified control. Eventually, in the New Year's joint editorial in 2009, the Cabinet was no longer mentioned, though the need for "increases in centralized and unified control" was still emphasized. It is expected that instead of the Cabinet, ministries and factory managers and the economic offices at central and local and factories will have more say in economic management. In the same editorial, it is also said that economic management should be improved in order to take advantage of and demonstrate the superiority of the planned economy, not to achieve the real economic benefits, as had been emphasized in 2001-2005.

   Jang Song-thaek was once again promoted in October 2007. He was named secretary for administration at the central party secretariat in charge of public security and various political police organizations. Since then, the conservatives have become bolder in their offensive. As the second inter-Korean summit was held in October 2007, North Korean authorities began a major offensive against market activities and cultural influence from South Korea in North Korean society. Market activities became increasingly constrained.

   For instance, a rule that only females over the age of 50 can engage in trading activities in the market was introduced. Simultaneously, the regime ordered others to return to their original workplaces, even if nothing productive could be done and no salary could be assured. Various organizations for public security have been strengthened, and various centrally organized inspection teams have been sent to localities. The purpose has been to guarantee the implementation of anti-market measures and intensify central control. Hard hit have been border cities with mushrooming unauthorized trading companies on behalf of powerful central public organizations.

   Major rice-producing regions and agricultural units have also been seriously harassed. In November 2007, an extraordinarily strict group for fighting anti-socialist phenomena was sent to the South and North Hwanghae provinces. The mission was to expropriate rice for the military and the capital, Pyongyang. Because of the extreme activities for expropriation and concurrent chaos, the Hwanghae provinces, which escaped mass hunger even in the mid-1990s, suffered a major food crisis in early 2008. The order for rice expropriation from cooperative farms by the party also recurred in September 2008. It should be remembered that this kind of action by the regime was not observed during 2001-2005, when the reformists were in charge and South Korea delivered rice and fertilizer regularly.

   Jang Song-thaek's role was known to have been enhanced when Kim Jong-il was rumored to have been incapacitated due to a stroke in mid-August. Jang is known to have played a central part in the management of North Korea on behalf of Kim during his absence from the public. During this period, North Korean internal policy became more rigid and was accompanied by increased animosity toward South Korea. Since September, North Korean authorities have aggravated their attack against South Korea and put severe limitations on traffic between the Kaesong industrial complex and South Korea, limiting South Korean activities there. On the domestic front, reportedly, the Cabinet ordered in November 2008 that street markets that were then held daily should be held only once every 10 days in 2009, and that food should be traded at state agencies for food distribution, and industrial consumer commodities should be sold at state trading chains.

   In sum, the conservative trend is connected with the rise of Jang Song-thaek. It might mean that a return to reformist policy will be impossible until he is replaced with a reformist lieutenant of Kim Jong-il. What is certain is that Jang is regarded as very powerful at this juncture, though it is not clear how powerful he could be on his own merit, without Kim's personal backing.

   What is also certain is that Kim's conservative policy orientation has no future considering the circumstances now facing North Korea. To hinder expansion of market relations and to take measures for the restoration of old political control mechanisms would be a Sisyphean undertaking in North Korea and provoke resistance from all echelons of the society negatively hit by the measures. All in all, the conservative turn since late 2005 has done nothing to prevent the economy from deteriorating. In 2009, Jang Song-thaek seems to feel it is imperative either to resort to ever harsher measures to make the "revolutionary production surge" effective or to retreat a bit from enhanced control to avoid confrontation with society. Anyway, what is certain is that he may provoke intensified tension with the outside world, especially with the South, to nullify internal discontent and distract attention from state incapacity and policy failures.