North Korea: Absolute Power and Absolute Corruption

Translated by: 
Shirley Lee

Systemic flaws and inherent corruption have prevented North Korea from fulfilling the promise of its juche ideology of self-reliance. Following the collapse of its strongest ally, the Soviet Union, these flaws became more apparent. Without Soviet support, corruption – once the fiefdom of the elite – began to filter down to all levels of society. A catastrophic effect of this was the failure of North Korea’s official rationing system. This occurred in 1994 as a result of political instability brought about by President Kim Il-sung’s death, economic free-fall after the disintegration of the Soviet Union, and the consequent breakdown of law and order. The people had depended on the rationing system, and its failure fatally undermined their loyalty to the party.

All North Koreans were divided into classes and granted rations according to their loyalty to the Kim family and the regime. According to their class, people were entitled to receive ‘everyday rations’, ‘three-day rations’, ‘weekly rations’ or ‘monthly rations’. When the government stopped the general distribution of rations in 1994, mass starvation decimated the population. It is widely thought that up to two million – and perhaps more – died in the famine, though there is no way of confirming the number of deaths.

At the same time, monthly rations were abolished. The provision of weekly rations to mid-ranking officials was delegated to each department that employed these officials. Consequently, only the groups entitled to everyday rations and three-day rations – the most privileged members of society – continued to receive regular food supplies.

An everyday ration was calculated according to the number of calories required daily for one person, multiplied by the number of members in a family. These were provided to central party secretaries, departmental directors and deputies, ministers, military personnel ranked commander and above, and those working in close proximity to the ruling Kim, such as his bodyguards. Three-day rations were for central party deputies, managers and deputy ministers. The most coveted ‘ration’, though, was a gift from Kim Jong-il, often including foreign luxury goods not otherwise obtainable on the domestic market.

The collapse of rationing in 1994 saw a corresponding expansion of the black market, which compelled North Koreans to obtain goods according to the forces of supply and demand. Foreign goods, even luxury items, began to circulate, making the Kims’ system of ‘loyalty gifts’ obsolete. The obeisant and privileged classes began to be rewarded instead with valuable foreign currency, which in turn led to the beginning of financial corruption in North Korea.

Black markets began to appear overnight, and their unregulated business offered a new avenue for corruption.

On 1 July 2000 the Democratic People’s Republic of Korea (DPRK) announced its ‘7.1 Policy’, through which the value of goods would be officially determined ‘according to market forces’. This was an effort to regain control of the economy and reassert the authority of the dictatorship. Before this, there had been no notion of inflation, given that the regime determined the value of goods. However, since the planned economy had collapsed, the regime had no option but to turn a blind eye to the black markets.

The 7.1 Policy was ineffective; it only exposed the widening disparity between the official ‘market’ prices and actual values. While the policy remains in force, the gap between values is exploited. And because the framework is patchy, there are economic loopholes exploited by those with money or power.

The situation is aggravated by the fact that the regime has not been consistent in adhering to its own economic regulations and has often changed its line. North Koreans have lost confidence in the law and in other frameworks set up by the regime, and have come to rely on the abuse of political privileges and the use of illegal markets for basic subsistence. The North Korean people have adapted quickly to this new order and their fundamental worldview has started to shift. In the past, North Koreans knew only the value of loyalty as it related to the rigid system of rewards. However, North Koreans are now growing accustomed to the ‘new’ system of market forces, of supply and demand, and are coming to understand that goods have value outside what is dictated by the regime.

This transformation goes hand in hand with an increasing awareness of the idea of fending for oneself, rather than working for the collective good. The disparity between the people’s revised mindset and the official line creates a vacuum that corruption has readily filled. As goods become valuable, the traditional system of fealty to the regime and reward from the regime becomes redundant, and society spirals into economic anarchy, especially as individual survival cannot be assured within the sanctioned framework.

The future of the current regime requires the continued deification of the Kim family and its dispensation of political privileges; thus, corruption is sustained, at least to the extent that it benefits the elite. To maintain political, if not economic, stability, the dictator must allow power to trickle down to his relatives and close associates: the power structure in the DPRK is held together by personal relationships rather than by an abstract or legal framework. In other words, the abuse of power, such as granting positions to family members, is the rule rather than the exception. This form of corruption is no longer restricted to the higher echelons.

In the past, a loyal citizen could aspire to become a privileged member of the ruling Workers’ Party, to obtain a better job or to acquire the right to live within Pyongyang’s city limits. These were the incentives to remain loyal to the state. Recently, however, financial wealth has become both the basis of power and the method of reward, because money guarantees a comfortable life, and political loyalty alone does not. It is significant that today North Korea’s elite perceives the acquisition of personal wealth as a better route to power than mere loyalty to the regime.

The absence of an independent media in the DPRK ensures that corruption, in all its forms, goes unreported. The media follow the diktat of the Party’s propaganda department, and this is their raison d’être. Lack of press freedom actively facilitates North Korea’s endemic corruption. There is an entity called ‘Channel 3’ which purportedly monitors corruption; in reality this is another means by which the Party’s propaganda machine retains far-reaching control over society. Channel 3 serves a regime that not only prohibits press freedom, but also silences any sentiment perceived to be negative. Corruption thrives in an atmosphere where it is permissible to express no opinion other than that endorsed by the Party.

Corruption also thrives in other forms and at different levels in North Korean society. It occurs on the individual level when officials abuse their public power for private gain, or conduct personal activities in the name of the state. The most common such abuse is the arrangement of job transfers, promotions or foreign postings, usually in exchange for a bribe. Bribery is the most common form of corruption; nearly all punishments and purges in the higher echelons are the direct consequence of bribery cases gone wrong. Embezzlement is also very common, with the proceeds routed abroad.

After the collapse of the state’s planned economy and the consequent depletion of its resources, government departments were stripped of the civic duties and responsibilities for which they were established. This fuelled the growth of corruption at a systemic level. Officials began seeking every opportunity to earn money, including foreign currency, in the name of the state department they worked for. These officials at least have an excuse for their illegal activities: they are trying to feed their employees. 
Yet with each government department merely looking after its own, civil servants come to resemble organized criminal gangs, and have no incentive to act in the public interest.

The DPRK continues to be run by carrot-and-stick policies, with loyalty to the regime the standard of virtue. This results in severe socio-economic disparities between the shrinking ‘loyal’ classes and the overwhelming majority deemed ‘corrupt’, which includes those judged ‘guilty’ because of their family background. In any event, all laws become irrelevant in the face of the omnipotent divinity of the Kim household. The laws of North Korea are corrupt in that they are executed according to double standards; and the law is invalidated altogether when it concerns Kim or his orders.

Perhaps most insidious of all is the fact that the corruption of North Korea is not contained within its borders; it also affects the international community. North Korea continues to be a major exporter of drugs such as heroin and amphetamines; it is a leader in the field of human trafficking and one of the world’s largest manufacturers of counterfeit banknotes. The country’s laws do not protect ordinary North Koreans, who are therefore vulnerable both to becoming victims of crime and succumbing to its temptations. The fundamental corruption of the DPRK regime denies North Koreans a framework that would allow them to sustain their livelihoods within the law. It is therefore not surprising that in order to survive, many people have no choice but to engage fully with the world of crime and corruption that surrounds them.


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