John Bolton on Kim Jong Un, 'The Great Successor'

John Bolton, former UN ambassador, writing from the Wall Street Journal, discusses the future of North Korea’s government leadership in the wake of Kim Jong Il’s death:

North Korean dictator Kim Jong Il’s death opens a period of intense danger and risk, but also potentially enormous opportunity for America and its allies. Kim’s health had obviously been poor for some time, and his regime has worked to ensure an orderly transition to his son, Kim Jong Eun. The Kim family and its supporters, with everything obviously at stake, will work strenuously to convey stability and control. Indeed, the official North Korea news agency has already referred to Jong Eun as “the great successor to the revolutionary cause.”

But the loathsome Democratic Peoples Republic of Korea (DPRK) is not a constitutional monarchy like Britain. While DPRK founder Kim Il Sung was powerful enough to impose his son, no guarantees exist that the North’s military, the real power, will meekly accept rule by his utterly inexperienced grandson.

Under the surface in Pyongyang, the maneuvering has almost certainly already begun. There is no reason whatever to believe that opinion among the military leadership will be unanimous, either to support or oppose the regime’s succession plan. In fact, the early reports are that Kim Jong Il’s death went undisclosed publicly for days, perhaps indicating a power struggle already under way. Many generals may simply not accept that Leader 3.0 is competent or merits their support.

While an authoritarian DPRK state, armed with nuclear, chemical and biological weapons, is a threat regionally and globally, a fractured DPRK, leaderless and perhaps descending into civil war, is an even greater threat. The prospect of conflict among various military and other security forces, which like the Kim family also have everything on the line, is real. Control over the weapons of mass destruction and other key assets (missile launch sites and storage facilities, communications facilities, the loyalty of major military formations such as the artillery, and armor massed near the borders) will be essential.

Moreover, North Korea’s civilians are not, despite decades of effort by Pyongyang, totally ignorant about conditions outside the hermetic state. Already desperately impoverished and hungry, they may well decide at the first signs of regime collapse, or even before, that their moment is at hand. Aided by South Korean activists, they could begin moving north toward the Yalu River border with China or south to the Demilitarized Zone (DMZ), which has divided North from South since the 1953 Korean War Armistice Agreement. South Korean authorities, together with the nearly 30,000 U.S. forces there, have long prepared for the contingency of massive refugee flows toward the DMZ. They also have plans for entering North Korea in force on extremely short notice, to prevent massive instability, to secure the nuclear weapons, and to control the DMZ.

The very last part is largely in question, in my view. How willing is the South Korean government going to be to even contemplate a partial unification of Korea? North Korea has a domestic annual GDP comparable to South Dakota. Conversely, South Korea’s GDP tops $1 trillion annually. So to use the comparison of Germany’s reunification doesn’t quite cut it. At least East Germany produced roughly one-third to that of West Germany. Even then, the reunification fell largely on the backs of the more prosperous West Germans. In fact, in 2008 nearly half of Germany’s total output ended up being a complete transfer of wealth from west to east. Meanwhile, the east remains far behind in output, employment, business development and overall standard of living. Given that most east Germans who are marketable end up leaving for careers in the west. The only options, at least short term, to close the growing gap is more wealth transfers to the east. That is an option that most taxpayers and business owners understandably resent.

The South Korea/North Korea model would be substantially different. (Peter Beck, WSJ)

Even the best-case German model will cause South Koreans heartburn. Despite the $2 trillion West Germany has paid over two decades, Bonn had it relatively easy in the beginning. East Germany’s population was only one-quarter of West Germany’s, and in 1989 East German per capita income was one-third of the West’s. The two Germanies also had extensive trade ties. North Korea’s per capita income is less than 5% of the South’s. Each year the dollar value of South Korea’s GDP expansion equals the entire North Korean economy. The North’s population is half the South’s and rising thanks to a high birth rate. North and South also barely trade with each other. To catch up to the South, North Korea will need more resources than East Germany required if living standards on both sides of the peninsula are to be close to each other.

More than a dozen reports by governments, academics and investment banks in recent years have attempted to estimate the cost of Korean unification. At the low end, the Rand Corporation estimates $50 billion. But that assumes only a doubling of Northern incomes from current levels, which would leave incomes in the North at less than 10% of the South.

At the high end, Credit Suisse estimated last year that unification would cost $1.5 trillion, but with North Korean incomes rising to only 60% of those in the South. I estimate that raising Northern incomes to 80% of Southern levels–which would likely be a political necessity–would cost anywhere from $2 trillion to $5 trillion, spread out over 30 years. That would work out to at least $40,000 per capita if distributed solely among South Koreans.