North Korea’s economy is better than you think

One of the stock accusations against communism is that it inevitably results in economic disaster, delivering only poverty and famine to its captive populations. The shelves of stores are perpetually bare; people wait in line all day for meager rations; life is reduced to a scramble for bare necessities. Only capitalism and the free market can efficiently allocate resources to create abundance. Communism is nothing more than the equal sharing of misery.

North Korea, more than any other country, is held up as a perfect example of communist failure. Illustrating this is satellite imagery of East Asia at night. Everywhere the bright lights of capitalist prosperity shine up at the sky—China, Japan, Taiwan, South Korea—but in the center is North Korea: total darkness.

The truth is that the North Korean economy functions well, and always has done so, even under incredibly difficult circumstances.

During the Korea War, from 1950 to 1953, North Korea was almost completely destroyed. The United States waged “total war” consciously intended to create a wasteland. Almost every city was reduced to rubble; in many places no modern buildings were left standing. People had to live in caves and holes in the ground; farmers could only work the fields at night. Eventually even irrigation dams were bombed to flood agricultural land and produce famine. Bomber pilots complained there were no more targets left to hit. Twelve to fifteen percent of the population of North Korea died.

Following this devastation, however, North Korea rebuilt rapidly. It soon achieved economic growth rates that far surpassed those of South Korea and were among the highest in the world, lasting into the 1970s. In fact, during this time North Korea was widely if grudgingly seen as something of an “economic miracle.”

With the dissolution of the Soviet Bloc starting in 1989, North Korea lost one of its largest trading partners, initiating a long period of economic crisis. Not only did North Korea lose a great deal of trade revenue, reducing it ability to import needed items like oil and fertilizer, but the country was also hit by the most severe droughts in a century. Crops failed, leading to serious food shortages.

North Korea’s ability to engage in normal trade with the non-communist world has always been severely crippled by far-reaching economic sanctions imposed by the United States. This form of economic warfare has only become worse with time. Today, any corporation anywhere in the world that does business with North Korea faces the possibility of asset seizure and trade bans by the United States. Few are willing to take the risk.

The combination of collapsing trade, severe drought, and relentless economic blockade has badly damaged the North Korean economy. During the 90s there was outright starvation. The country had difficulty producing enough electricity to keep the lights on. North Korea experienced a perfect storm of economic disaster.

But despite all this, and despite the gleeful anticipation of its collapse by Western capitalism, North Korea appears to be recovering. A detailed study by Henri Feron, published in the Asia-Pacific Journal, concludes:

The theory of the “coming North Korean collapse” is a curiously tenacious myth. It is based on little more than speculation, sometimes aggravated by misinformation, disinformation or wishful thinking. Even the dubious and undervalued statistics commonly cited in the Western and South Korean press hardly support allegations that the DPRK’s socialist economy is slowly disintegrating. On the contrary, comparatively reliable indicators on food and trade suggest that it is recovering and catching up, despite the extremely hostile conditions it has faced since the 1990s.

Visitors to North Korea report striking improvements:

The number of cars has been growing so much that in the capital traffic lights had to be installed and the famous “Flowers of Pyongyang”—the traffic ladies—had to be pulled off the street lest they get overrun by Beijing taxis, home-made Huitparams and Samchollis, the ever-present German luxury brands of all ages and the occasional Hummer. Inline-skating kids are now such a common sight that hardly any visitor bothers mentioning them anymore. Restaurants and shops are everywhere, people are better dressed, more self-confident than two decades ago, and obviously also better fed, at least in the capital. Air conditioners are mounted on the walls of many residential buildings and offices. Everyone seems to have a mobile phone, and there are even tablet computers. In the countryside, too, signs of improving living standards are visible, including solar panels, TV antennas, cars in front of farmer’s houses, shops, restaurants and so forth.

North Korea throughout its history has faced catastrophic problems: annihilating total war, the loss of major trading partners, aggressive and unrelenting economic strangulation, and incessant military threat. Behind all of these problems is the United States. The US has always sought to destroy North Korea, and if not destroy, then poison, stunt, and defame.

In fact, North Korea’s persistence and success in spite of all this, rather than showing it to be a poster child of communism’s cruelty and stupidity, is testimony to how tough, resilient, and effective communist societies are.


Categories: Communism

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