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November 4, 2006
Why We Got The 'Soprano State' Back To The Table

Josh Meyer reports that the US forced North Korea back to the six-party talks through a three-year effort to cut Kim Jong-Il off from the monetary supply he needs to maintain power, a long and consistent effort that succeeded because the Bush administration refused to take the advice of its critics. The White House kept shutting more and more doors until Kim had only one left to open (via QandO):

For three years, the Bush administration has waged a campaign to choke off North Korea's access to the world's financial system, where U.S. officials say the nation launders money from criminal enterprises to fuel its trade in missile technology and its efforts to build a nuclear arsenal.

That effort has started to pay off.

U.S. pressure forced Macao this year to freeze North Korean assets in one of its banks, then foiled North Korea's panicky attempts to find friendly bankers in Vietnam, Mongolia, Singapore and Europe. And after North Korea's Oct. 9 nuclear test, China ordered some of its major banks to cease financial transactions with the country.

The cash crunch appears to have played a key role in North Korea's decision Tuesday to return to six-nation talks over its nuclear ambitions. North Korean officials said that as part of the talks, they wanted to raise the issue of lifting financial sanctions.

"They're not coming back because they want to give up nuclear weapons," said David L. Asher, the U.S. State Department's point man on North Korea until last year. "They are feeling the financial pressure and the cutoff from the international financial system, so they are trying to make nice."

The strategy got a big boost from China in the last few weeks after Kim tested his missiles and then conducted a nuclear-weapons test near Kilju. Beijing, embarrassed by their failure to influence Kim over the last few months, abruptly shut off access to their banking system, throwing Pyongyang into a panic. They returned to the multilateral talks in order to get access to global financial systems, without which Kim cannot maintain power.

In fact, the Bush administration has a clear idea about Kim's grip on the state apparatus in North Korea. They call it a "Soprano state" because Kim runs it as a criminal enterprise. He engages in explicit criminal activity -- counterfeiting and drug running -- in order to gain hard currency to spread around to those who prop him up as dictator. It is this insight which allowed the Bush administration to hone in on Kim's weakness: cash.

Bush's critics have accused him of obstinacy and unreasonable antagonism in his dealings with Kim, but that hasn't been the case at all. In order to gain something from a negotiation, one has to know what one's opponent needs. Kim doesn't really concern himself with the starvation of his people, so food aid has gained us nothing. Trade means almost as little, because North Korea doesn't export much in any case -- just a few agricultural items, most of which get sold in China, South Korea, and Japan until recently. Kim needs to keep the flow of cash and luxury items for his capos to keep them from finally turning on him and giving him the Julius Caesar treatment -- and US efforts to cut that off have had the intended effect.

Kim came back to the table to save his own skin, and now we have the basis of real negotiation. This is something that Jimmy Carter and Madeline Albright never deduced, despite all of their dangerous blathering and can-kicking on this national security issue. Kim knows he has to cut a deal to survive, probably literally. Unlike its critics, the Bush administration refrained from panicking when Kim rattled his saber out of desperation, and when Kim realized that Bush wouldn't blink, he caved.

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Posted by Ed Morrissey at November 4, 2006 9:56 AM

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