The analyses, comments and other opinions contained in this monograph are those of the author and do not necessarily represent the views of the Korea Institute for National Unification. The deterioration of economic conditions eventually rendered the North Korean regime's centrally planned economy and controlled functioning incompetent and led to the promotion of elements of the market economy.
The Regression of Socialist Regime Resilience
Paralysis of the Socialist System Functions Collapse of the Planned Economy
This manifested itself as the military first idea without having to publicly address the betrayal of the working class. North Korea called this military policy “political,” but it means that the party's function has been halted and there is no central democratic system of governance.
Loss of Regime Legitimacy
Many North Koreans are beginning to believe that socialism killed a lot of people. Another complaint of North Koreans is that they do not have freedom of movement or travel.
The Unrest of the Cadres’ Confidence Toward the Regime
Another problem is that people have to spend seven to ten years of their youth serving in the military. Spending his entire youth doing nothing for almost ten years does not help the development of the North Korean. The North Korean leaders are also experiencing a loss of confidence as they find it difficult to recover when the regime is in crisis.
They would claim that “socialism in Eastern Europe has allegedly already collapsed and the socialist system in the North has also done so, except that the leadership remains in power in the North. The cadres in the North seem to be more concerned about the regime in progress than the economic crisis. They believe that the North Korean regime has already derailed from the socialism track, and are concerned about whether the regime can return to normal or otherwise find a new way amid the recent instability.
It is believed that socialism in the North looked nice from the outside, but is not real socialism.
Poor Functions of Physical Constraints
It is said that the ideological fluctuation among the cadres is quite serious because they do not know where they are going or what their final destination will be. The most strikingly clear behavior of the ruling elite in the midst of economic hardship is that they tend to pursue their own economic benefits by colluding with the anti-socialist underground economy. The army, the party, the finance ministry and the security ministry are said to be "protecting" the people working in the underground economy as one.
The motivation behind the change is none other than the corruption of North Korean cadres. The regime's legitimacy has plummeted, with North Koreans scoffing at the ruling ideology and political slogans. As businesses have become an everyday way of life for North Koreans, the legitimacy of the regime.
A part of the unofficial sector was "discovered" or legalized and is surpassing the official part in terms of quantity.16 This is one of the reasons that North Korea can maintain the stability of its regime in the midst of economic difficulties.
The Creation of a New Mode of Production: Primitive Market Economy and Household Industry
There is an indication that a new primitive economy is being created on the ruins of socialism. It can be assumed that a new kind of regime developed from the unofficial sector in the early 1990s, called the second society.
The Creation of Primitive Commercialism
Second, the proliferation of business in the country was due to the improvement of the trade management system in November 1992. Previously, trade was completely subordinated to the central government and placed under the control of the Ministry of Foreign Trade, the body responsible for foreign trade. and economic business. 17. The military project consisting mostly of foreign exchange projects caused a whirlwind of commercialism in North Korea.
Military units ran companies directly, but most companies were run in the form of stamp registration. The stamp is similar to the "Guahu" of China.18 Civilians are issued the registered army stamp and earn the draft for foreign exchange in the name of the military unit. Another factor stimulating the development of the market are the measures for management and economic improvement of July 2002.
It was borrowed and used instead of the government to avoid government control.
Household Industry and Small-sized Item Production System The prevalence of business causes a lot of change in the field
The Formation of a New Economy Management System: Segmentation Economy and Crony Economy
The economy of segmentation is the self-reliant and primitive market economy, which is far removed from state control under the banner of self-reliance. The segmentation economy is an economic system of black market, cottage industry, small-item production, and primitive self-sufficiency. Since 1994 the economy began to show the definitive characteristics of the economy of segmentation.
In view of this, the North once allowed elections for the managers of the factory enterprises. The North does not call this system the abolition of the planned economy, nor the market economy. The segmentation economy based on self-reliance is one of the reasons why there is no resistance to the central government amid economic hardship.
However, the biggest problem with the segmentation economy is that it has no extended production for the future.
The Formation of New View of Values
In the event that someone fails, the person is usually reported missing unless the matter becomes a major problem. At the same time, they express to the higher authorities that they feel in need, while at the same time finding ways to live in the local areas. With less control from the central government, they establish an independent but closed dependency system in the old feudal economy.
The masses have come to realize that since the state provides nothing, they have to earn money themselves, because they might starve if they rely solely on the state. In the past, driving was possible for free in a personal relationship, but the current structure does not allow people to get ahead without money. It is said that people in the lower classes changed a lot in terms of ideology.
Regardless of politics, and whether it is capitalism or socialism, people firmly believe that they need money.27.
The Formation of a New Order: Second Society’s Order
It is said that money talks in the North, except when it comes to anti-government activities. North Koreans often use the term "expensive medicine" to mean "giving a bribe". To this end, both the supervisory authorities and the regulated live up to their expectations. It said train users must be screened and inspected by the train security guard, the train inspection team, the train station security team and the 711 patrol team.
Additionally, passengers are required to re-check their pass and baggage at the station security team after alighting from the train. It is said that people, if they are lucky, can be checked once or else several times during the train journey. In this regard, the change in the mode of production such as the primitive market economy and cottage industry and the change to new systems of economic management, such as the segment economy and the association economy, and the creation of a new social order are likely to continue and be. irreversible.
This chapter analyzes the possibility of contingencies in North Korea and how new changes in the situation such as the nuclear issue and improved US-North Korea relations will affect the Korean peninsula.
Low Possibility of Contingencies
This chapter focuses on analyzing the possibility of unforeseen events (regime destruction), which is the third element related to regime sustainability. Another restraining element is the expectation of a resolution of the nuclear issue and diplomatic normalization between Pyongyang and Washington. A series of changes in international relations such as the resolution of the nuclear issue, diplomatic normalization and inter-Korean summits give the North Koreans new expectations, while lowering the possibility of unforeseen measures.
That said, there seems to be a growing sense among North Koreans that they still have to wait.
Possibility of Contingencies through Reform and Openness
Tocqueville's paradox.”32 This is because a little bit of change from above can trigger demands from the masses. The North Korean leadership is concerned that if reforms are attempted during a crisis situation, the regime may lose its legitimacy and there may be a popular uprising, which may lead to a revolutionary situation that the leadership cannot accept. It is a general phenomenon from a historical development perspective for the North Korean people to demand improvements after realizing the oppressive, undemocratic and dehumanized ruling nature of the regime, if reform and openness are promoted.
There was no people's uprising in China, even during the Great Leap Forward where several thousand starved to death. But the Tiananmen Square protests took place in 1989, ten years after reform and openness were well under way. In the case of the North, there will likely be a backlash towards reform and openness.
North Korea could suffer more serious consequences for retaining a regime with a closed and deformed ideology.
Paradox of Reform and Openness
In the previous chapters, we looked at the sustainability of the socialist regime, the adaptability of the regime and the possibility of cases, respectively. It's a curious phenomenon of "bad luck often brings good luck". This is one of the reasons that the North is able to maintain its regime amid economic difficulties. By comparing this phenomenon with that of the socialist countries of Eastern Europe, it can be interpreted that the second society or the parallel society is fully underway in the north.
Although it is a form of minimal survival, the North Koreans consider this the absence of intervention. The relationship between the declining first society and the newly formed second society in the North is shown in the graph below. The sustainability of the North Korean regime will be strengthened if the North can benefit from this trend.
If it is difficult to anticipate a sudden contingency in the North and the possibility of North Korea's soft landing is quite high, it is reasonable to seek policies to help promote the North's reform and openness.
Economic Hardship and Regime Sustainability in North Korea
