Date: Mon, 23 Feb 98 23:37:54 CST
From: Interhemispheric Resouce Center <email@example.com>
Subject: In Focus: Korea
North and South Korea-with a population of 70 million people in a
strategic corner of Northeast Asia-have received more media attention
over the past three years than at any time since the end of the Korean
War in 1953. In December 1997 the U.S. and the International Monetary
Fund crafted a $57 billion bailout to rescue South Korea from a
financial crisis that clouded the reputation of the once-vaunted
economic miracle. Since 1994, when the U.S. almost went
to war over allegations that North Korea was developing nuclear
weapons, enormous attention has been focused on the northern part of
the Korean peninsula. In 1997, news emerged of massive starvation
caused by natural disasters and the collapse of North Korea's
economic system. With South Korea facing unprecedented economic
challenges and North Korea seeking ways to avoid the fate of its
former communist allies in Eastern Europe, the Korean peninsula will
remain volatile (and a major focus on U.S. foreign policy) for years
Many of Korea's problems stem from Japan's brutal colonization
between 1910 and 1945 and the peninsula's tragic division in the
aftermath of World War II. Cold war tensions on both sides of the
border exploded in 1950, when North Korea sought to unify the country
under the leadership of Kim Il Sung and overthrow the
pro-U.S. government in the South. The U.S. forces, which were sent to
intervene in what was essentially a civil war, never left. Today,
37,000 U.S. troops remain in South Korea, concentrated near the border
with the North as a
tripwire to automatically ensure U.S.
involvement if another war erupts. South and North Korea remain two of
the most militarized countries on earth, with over two million
soldiers under arms.
Over the past 30 years, South Korea has risen from a major recipient of U.S. aid to become a major exporter of automobiles, steel, and semiconductors as well as the fifth-largest market for U.S. goods. Its political system has also undergone a major transformation. In 1986 millions of South Koreans demanded an end to two decades of military dictatorship, forcing the unpopular government of Chun Doo Hwan to agree to direct presidential elections. The democratic movement took a historic turn in December 1997, when Kim Dae Jung, the country's leading dissident, was elected president.
With the advent of democracy, Korean workers organized what has become one of the strongest labor movements in the world. In 1996 Korean unions launched a general strike to successfully defeat a labor law that made it easier for companies to fire workers. Unions now play a key role in their country's economic restructuring.
North Korea is a Stalinist state where decisionmaking is highly
concentrated in the ruling Workers Party and the military, but has
entered a period of rapid change. In the early 1990s, North Korea
reached a state of crisis following the Soviet demise, which deprived
the country of cheap oil supplies and a key market. With his plans for
a self-reliant economy in shambles, and apparently fearing a
U.S. military strike, Kim Il Sung forced a confrontation with the
U.S. in 1993 by building a
secret plutonium facility that was
quickly discovered by U.S. intelligence. War was averted when former
President Jimmy Carter initiated negotiations with Kim, who died in
1994 and was succeeded by his son, Kim Jong Il. In 1995, the North
agreed to stop the plutonium project in exchange for improved
relations with the U.S. and international assistance in building a
nuclear power system using U.S.-designed light water reactors.
In March 1998, the United States, South and North Korea, and China began formal talks to end the Korean War. Meanwhile, the North is trying to head off a collapse by slowly opening parts of its economy to foreign investment and technology.
Despite vast changes in Seoul and Pyongyang, cold war thinking still
dominates the U.S. approach to Korea. To justify the continued
presence of 37,000 U.S. troops and the sale of billions of dollars
worth of U.S. weapons in Korea, the Pentagon has consistently
overestimated the military threat from North Korea. During a visit to
Seoul in January 1998, U.S. Defense Secretary William Cohen warned
the financially strapped Korean government not to delay purchases of
over $1 billion worth of U.S. aircraft and weapons. To do so, he said,
would send the wrong signal and enhance and escalate tension on the
The standoff between North and South is indeed dangerous, and the U.S. military has an important role to play as the two sides move toward rapprochement. But North Korea is not the only factor in U.S. policy; U.S. troops in Korea are also part of Washington's forward deployment in Asia and the defense of Japan. Many analysts doubt that North Korea, which lacks an industrial base and is rapidly losing the ability to feed and clothe its people, has the capacity to mount a full-scale war against the combined forces of the U.S., South Korea, and Japan.
Meanwhile, the Pentagon has single-handedly blocked the Clinton administration from backing a global treaty against land mines signed by over 100 nations in December 1997. U.S. generals contend that the thousands of antipersonnel mines along the 155-mile Demilitarized Zone are an essential component of deterrence.
The Pentagon continues to invent new reasons (and new enemies) for
maintaining U.S. troops in Korea. The latest rationale, explained by
Defense Secretary Cohen, is the economic crisis in Asia. In February
1998 Cohen told the House Banking Committee that U.S. security
interests would be threatened if the financial crisis worsened, and he
linked the 100,000 U.S. soldiers in Japan and South Korea to the
stability of the region.
It's very clear that business follows
the flag, he said.
There won't be investment where there
The cold war also hangs like a shadow over the troubled South Korean economy. Under terms of the December 1997 IMF bailout, South Korea is undergoing severe shock treatment designed to curb the power of its huge conglomerates (called chaebol) and reform a banking system where lending decisions were often made by the government. The painful reforms will slow Korean growth rates from around 6% in 1996 to 2% in 1998. Unemployment could reach as high as one million as corporations faced with bankruptcy lay off workers. At the same time, South Korea's economy, which has been highly protected since the early 1970s, will be forced to open up, leading to unprecedented levels of foreign ownership.
In media coverage of the crisis, it has almost been forgotten that Chun Doo Hwan, the U.S.-supported dictator who ruled South Korea from 1980 to 1986, was convicted in 1996 of accepting millions of dollars in bribes from the chaebol. Those companies relied on their close ties to Chun, and his successors, Roh Tae Woo and Kim Young Sam, to create the state-led, bureaucratic, crony capitalism that has come back to haunt South Korea today.
Another overlooked issue is the role played in the Korean export
economy by the U.S. government and the large New York banks that will
receive a huge chunk of the IMF bailout. South Korea began its export
thrust in the mid-1960s by providing shoes, clothing, and construction
workers (and later mercenaries) to U.S. forces in Vietnam. In 1965,
under strong U.S. pressure, the military ruler Park Chung Hee signed
a normalization treaty with Japan, Korea's former colonizer. As
part of the deal, Japan provided nearly $1 billion in loans and
investments that helped jump-start Korean manufacturing industries,
including its textile and steel industries. In 1972 President Nixon
recognized Japan's role in South Korea when he revised the
U.S.-Japan Security Treaty with a clause stating that Korea was
essential to Japanese security. By the late 1970s South Korea
and Japan had a relationship resembling the U.S. and Mexico today,
with Korean workers using Japanese technology and components to make
products sold on the world market.
In 1979-1980 the Korean political and economic system nearly collapsed when Park was shot to death by the head of the powerful Korean CIA and Chun took over in a military coup that left hundreds of people dead in the southwestern city of Kwangju. During that time the Carter administration literally begged U.S. banks and corporations to continue investing in and lending to South Korea. The financial crunch continued until 1983, when the Reagan administration pressured Japan to cough up nearly $4 billion to ease Chun through the crisis. That money flowed in despite the deep fractures within Korean society, the imprisonment of hundreds of dissidents, and Chun's atrocities in Kwangju. Moreover, loans from key New York institutions like Chase Manhattan and Citibank were made with full knowledge of the heavily leveraged nature of the Korean economy and the close, incestuous relationship between government bureaucrats, Korean banks, and the chaebol.
Although the IMF and the Clinton administration have exerted enormous pressure on South Korea to reform its economic system and accept higher unemployment, they have said virtually nothing about the New York banks' responsibilities. It was only after Congress and critics from the right and left complained that the IMF was bailing out the U.S. banks that those institutions agreed to reschedule $24 billion worth of loans owed by South Korea and extend its interest payments.
The new adminstration of President Kim Dae Jung provides a historic opportunity for U.S. policy in Korea. For the first time since its founding in 1948, South Korea has chosen a president with no political and financial ties to the Korean business and military elite. His record as an opposition leader has made an important difference in South Korea's economic crisis. Because of his stature among Korean workers, Kim, in the days before he became president, was able to forge an agreement between labor, business, and government to allow companies facing bankruptcy or other emergencies to lay off workers. In return, unions won the right to engage in political activities and run candidates for office, while teachers and government workers will be allowed to join unions for the first time.
Kim has also used his political clout to criticize and reform the giant chaebol, who bear the chief responsibility for bringing the Korean economy to the point of bankruptcy. Though a final agreement between labor and business on the IMF-mandated changes and layoffs will be difficult (some unions have rejected the compromise), the fact that Korean workers are represented by independent unions has made it possible for them to share in national economic decisionmaking. That situation is in sharp contrast to Indonesia, for example, where authoritarian government and a lack of labor rights is fomenting serious political unrest.
To prevent Korean workers from bearing the brunt of IMF austerity measures, the U.S. should ensure that the U.S. banks and corporations that profited from the Korean export system share the burden by taking losses on loans and giving Korean companies more time to repay their debts. At the same time, increased attention should be paid to supporting growth in Korean domestic industry and agriculture in order to ease pressure on the chaebol to export their way out of the crisis. That would alleviate Washington's fears of widespread U.S. unemployment from the widening U.S. trade deficit with Asia.
Regarding North Korea, Kim Dae Jung's election signals more openness in Seoul toward dialogue with Pyongyang. Given that reality, the U.S. should take steps to improve its bilateral relationship with the North and to move toward full normalization by lifting economic sanctions and stepping up bilateral discussions on political and security issues. At the same time, the U.S. government should continue its policies to ease the humanitarian tragedy in the North by providing badly needed food and medicine. It is also critical for Washington to push ahead with the four-way peace talks that began in March, allowing all sides to begin discussing the framework to go beyond the present armistice and formally end the state of war that exists in Korea.
For the peace talks to succeed, however, U.S. military policies in Northeast Asia must change in a fundamental way. As a first step in creating trust and confidence, the U.S. government should renounce the use of landmines in Korea and set an early date for their removal, clearing the way for U.S. support of the Ottawa landmine treaty. The U.S. and South Korean governments must also change the status of the U.S.-Korean Combined Forces Command, under which a U.S. general commands South Korean troops in times of war. By taking full control of its armed forces, South Korea will alter an imbalanced military relationship that has no counterpart elsewhere in the world.
It is also essential to begin a discussion on the presence of over 100,000 U.S. military personnel in South Korea and Japan. The end of the cold war and the breakup of the Soviet Union have undermined the arguments for a forward U.S. military posture in Asia.
In the final analysis, helping South Korea through its economic crisis, formally ending the Korean War, and working toward the eventual peaceful unification between North and South requires the U.S. to deal with Korea as an independent nation. The arrogance of the past, when the democratic rights of the Korean people were overlooked in the name of U.S. security and economic interests, has created deep mistrust on both sides of the DMZ. With South Korea on the road to democracy and North Korea seeking a peaceful way to enter the world community, it is time to finally bring an end to the last cold war.
Asia Pacific Center for Justice and Peace
110 Maryland Avenue, NE, Box 70
Washington, DC 20002
Contact: Kathryn Johnson
Voice: (202) 543-1094
Japan Policy Research Institute
2138 Via Tiempo
Cardiff, CA 92007
Contact: Chalmers Johnson
Voice: (619) 944-3950
Korean American Peace Institute
PO Box 331
Ridgefield Park, NJ 07660
Contact: Paul Kim
Voice: (201) 440-6975
Korean Confederation of Trade Unions
Contact: Yoon Young-Mo, International Secretary
Voice: (011) 822-3673-0685
Contact: Hyuk-Kyo Suh
Pacific Asia Resource Center
PO Box 5250
Tokyo International, Japan
Voice: (011) 81-3291-4901
Fax: (011) 81-3-3292-2437
Mark Clifford, Troubled Tiger (M.E.Sharpe, 1994).
Bruce Cumings, Korea's Place in the Sun (Norton, 1997).
Time to End the Korean War, Atlantic Magazine, January 1997.
Don Oberdorfer, The Two Koreas: A Contemporary History (Addison-Wesley,1997).
Debunking Korea Landmine Exemption, February
The U.S. Role in South Korea in 1979 and 1980,
Korea Herald (daily newspaper from Seoul)
Korea Progressive News (news from South
Korea Web Weekly (excellent resource on all
aspects of North and South Korea)