Cover Story

KIM'S KEEPERS

News from the Korean peninsula is almost uniformly bad-and perhaps connected. Some Korea watchers worry that South Korea's "sunshine policy" has served to prop up the communist regime to the north, easing southern concerns about the costs of collapse

Issue: "Nuclear threat in Korea," Aug. 16, 2003

Nuclear detection equipment has sniffed not one but two separate nuclear weapons programs wafting from North Korea, one based on highly enriched uranium and the other on plutonium-enough fissile material for more than a couple of nuclear bombs ... Former North Korean prisoners have produced names and locations for five gulags and begged the United States to monitor them with spy satellites. One lens already has revealed that one prison camp is larger than the District of Columbia ...

Dictator Kim Jong Il can threaten nuclear war but can't-or won't-feed his own people. One-third of them, at least, live on donated overseas food rations ...

Across the demilitarized zone, one of South Korea's wealthiest executives last week jumped from his 12th-story Seoul office, ending his life but launching new questions about South Korea's role in propping up North Korea at the expense of fellow Koreans-and a fresh nuclear standoff ...

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North and South Korea have been split into hostile camps for over 50 years, but they agree on one thing: Neither wants to be Germany. Fear of unification, of becoming a broken social system with declining regional power, is an unspoken psychosis gnawing at the edges of every diplomatic deal penned with Pyongyang.

It's no surprise that North Korea views any interaction with the free world's economic and political system as a threat to its socialist system and the cult of "dear leader" Kim, as he's called.

South Korea, on the other hand, protects in its constitution the right of North Koreans to become citizens. It runs a cabinet-level Ministry of Unification. Yet every year of decline in the north brings rising apprehension about the high cost of reunification. Prospering South Koreans fear a reunified Korea would slump into an economic and social chaos reminiscent of Germany after the fall of the Berlin Wall, only worse. North Koreans are far more destitute than East Germans were at the end of the Cold War. They cannot eat without overseas charity, while South Koreans have the 12th-largest economy in the world.

South Koreans' increasing standard of living also means more to lose, potentially, from reunification. That's led South Korean leaders to accommodate the north's depraved dictatorship, even investing in it, when collapse of the communist holdout should be the goal. U.S. officials, preparing for six-way talks next month to defang the North Korean nuclear threat, face a double-edged sword: how to deal with North Korea's manifold evils when South Korea, a key ally in the upcoming negotiations, is tolerating, even abetting them?

"Since 1998 the South Korean government has been looking as hard as it can the other way," says longtime Asian demographic expert Nicholas Eberstadt, "trying not to offer the constitutional guarantees to these [North Korean refugees] who have crossed the border into China, much less offer these rights to the people who are living in the northern half of the peninsula."

Misguided engagement, Mr.Eberstadt told a Senate panel on July 31, is a key reason the United States now faces nuclear showdown with Pyongyang. Reliable economic data show that the flow of merchandise and raw goods to North Korea has doubled since 1997-98, he said. That's when South Korea launched its "sunshine policy," a blatant attempt to buy peace through south-to-north business investment, putting billions in the hands of Kim Jong Il. It also coincided with international efforts to ease the country's famine. The United States gave $10 million to North Korea in food aid in 1997 and has contributed over $600 million since. That's in addition to the billions the United States and its allies have poured into so-called energy development.

Mr. Eberstadt, author of The End of North Korea, said the foreign aid, together with illicit income from weapons sales, drug trade, and counterfeiting, pays for imports, and for the development of nuclear weapons. Legitimate exports, meanwhile, have held flat at less than half the import rate and less than $50 per person.

"It's our money," said Michael Horowitz, a Hudson Institute scholar who also testified before the Senate Foreign Relations Committee. "It's in some measure Japan's money and it's very particularly South Korea's money that's kept the regime propped up."

Under-the-table payments to North Korea led to the Aug. 4 suicide of Chung Mong Hun, chairman of Hyundai Group and South Korea's leading businessman. The demure 54-year-old executive jumped to his death from the 12th floor of the conglomerate's headquarters in Seoul on a Monday morning. He was about to face trial on charges that he illegally funneled cash to North Korea on behalf of the South Korean government. He apologized in suicide notes to family and colleagues for "being a stupid man and for doing a stupid act."

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