North Korea-weekly review-7

NORTH KOREA NEWSLETTER NO. 38 (January 22, 2009)

*** OPINION FROM EXPERTS

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.
(END)