B00BY4HXME EBOK Read online

  Even if we accept the lowest estimate of 450,000–500,000, it still means that some 2.5 percent of the entire population perished in the disaster. This is roughly equal to the ratio of Chinese farmers who perished from starvation during the Great Leap Forward of the early 1960s. In other words, it was the largest humanitarian disaster East Asia had seen for decades. Nevertheless, the majority of North Koreans survived the famine. They did so by creating new ways of life, socially and economically. In essence, the North Korean people rediscovered capitalism while the North Korean state had little choice but to relax its iron grip over the populace.

  THE SORRY FATE OF KATYA SINTSOVA

  Have you ever heard of Katya Sintsova? The beautiful Russian girl whose naïve admiration for capitalism and its debased “democracy” brought ruin to her and her entire family? A girl whose sorry and lamentable fate is so reminiscent of the tragic fate of her country, which deviated from the true path of Socialism?

  Katya Sintsova is a fictional (and highly improbable) character who appears in a North Korean short story, “The Fifth Photo.” This short story was produced by a North Korean writer named Rim Hwawon and is quite representative of the current North Korean writings about the collapse of Soviet and Eastern European Communism.

  As Tatiana Gabroussenko remarked in her soon-to-be published study of this peculiar kind of North Korean fiction, in the 1940s and 1950s the Russians were portrayed in North Korean literature as the leaders and guides helping their Korean comrades. In the 2000s, however, it is the Koreans who are the shining example, the embodiment of Socialist virtues, who are looked upon as advisers and as leaders. Russians are nowadays conversely presented as weak and naïve but still basically decent, noble human beings who flourish under the wise guidance of their North Korean friends.

  For instance, in one of these stories the CIA plants a bomb on a US passenger airliner. The reason for this operation (and as every North Korean knows this is the type of operation the CIA does frequently) is to kill a Russian scientist who refused to cooperate with the US military-industrial complex. In the story the Russian and his fellow passengers were lucky to have a North Korean on the same plane. The North Korean takes control of the situation and saves his fellow travelers from another vicious American plot.

  Of these stories, Rim Hwawon’s “The Fifth Photo” is quite typical. Katya Sintsova, its main character, is a beautiful Russian girl who comes from a family with impeccable Communist credentials. Her great-grandfather died a heroic death in 1919 during the Russian Civil War, her grandfather sacrificed his life fighting the Nazis, and her father was a selfless and hardworking party bureaucrat of the Brezhnev era. Her brother also became a top bureaucrat in the Moscow Party Youth Committee and was also equally selfless and hardworking.

  Katya was accepted to a top university due to her exceptional gifts in the arts. But at the university she fell under the spell of the wrong ideas.

  She began to interact with people whose ideological bent was less than healthy, and she even interacted with foreigners (the latter behavior is seen by Rim Hwawon as especially outrageous). She is upset about the contents of party meetings being so boring and she is overcome by materialism and a lust for change.

  An American seduces and impregnates her, after which she has an abortion. Meanwhile, her father dies, his last words being “Long live the Communist Party!” Katya loves him and feels sorry about his death, but still considers him an old fool. This is when she meets the book’s North Korean narrator, to whom she tries to sell photos from her precious family archive.

  The narrator is an example of flawless revolutionary virtue, and his own daughter is free from all the frivolous but dangerous ideas that have ruined Katya’s life—the exemplary North Korean girl dreams only of serving the Party and Leader better. The narrator’s sons are brave officers of the Korean People’s Army, always ready to fight the US imperialists. They are even treated to the highest honor imaginable, being granted an audience with the Dear Leader Marshal Kim Jong Il.

  Katya, meanwhile, travels overseas in search of her American lover. An awful discovery awaits her: he was not really an American, but the descendant of an anti-Communist Russian landlord family. Almost a century before their lands were nationalized, the vicious landlords’ family has spent all their time dreaming of revenge. Katya’s seduction was actually a part of a plot aimed at taking the lands back from the farmers and giving it to greedy and cruel landlords.

  Katya Sintsova’s sufferings don’t end with this awful discovery. While alone and helpless in the brutal West, she suffers a car accident and loses a leg. In order to survive she becomes a prostitute serving perverts in the city of Munich.

  The message of this story is simple and easy to understand: Katya is Russia herself. She was lured into a trap by the Western propaganda and scheming descendants of landlords, she was fooled into selling her great heritage, and she ended up a pitiful prostitute at the bottom of the merciless capitalist heap. The story is written to serve as a clear warning to North Koreans, who should not listen to the seductive voices from abroad and should remain on guard against their enemy.

  CAPITALISM REBORN

  In postfamine North Korea the old state-run and state-owned economy was replaced by a great multitude of private economic activities usually associated with what is described as a “black market”—somewhat misleadingly, as we shall see below. It was recently estimated that between 1998 and 2008, the share of income from informal economic activities reached 78 percent of the total income of North Korean households.5

  However, as said above, North Korea’s social transformation is rather different from near-contemporaneous developments in China and the former Soviet Union in that it was neither initiated nor endorsed by the authorities. For political reasons to be discussed later, Kim Il Sung’s socioeconomic system still remains an ideal for the North Korean elite. Nonetheless, this commitment does not go beyond words most of the time: the elite lack the resources and resolve that would make a revival of Kim Il Sung’s “national Stalinism” possible.

  When rations suddenly stopped coming, people began to learn ways to cope with the new situation—the only alternative being death by starvation. For farmers the most natural reaction was to start growing their own food. This was not that easy because, unlike their Chinese counterparts, North Korean bureaucrats showed no inclination to disband the notoriously inefficient state farms. The state farms’ fields were therefore usually guarded, preventing farmers from using the best arable land for their production. A majority of farmers had to look for alternative places to farm for themselves.

  North Korea is a mountainous country and thus it is not too difficult to find a steep slope that is not used for regular agriculture. A quick look at satellite pictures shows the presence of numerous small fields of irregular shapes and sizes located in the mountains. These are so’to’ji (literally “small fields”), the private plots of North Korea’s farmers and inhabitants of smaller towns. Generally, the further away one lives from major administrative and political centers, the easier it is to develop such a field. In more remote parts of the country, so’to’ji now produce more than half of the harvest but the nationwide average seems to be close to 20 percent.

  While farmers were working on their illicit plots, the urban population reacted to the new situation by discovering private commerce. Most urban families began by bartering household items for food, but soon switched to trade and household production. Beginning in 1995, huge markets began to grow in North Korea’s cities. They became the focal point of economic life in the country. Millions of North Koreans, women in particular, began to earn the family’s income through trade and household handicraft production.

  Women make up the majority of North Korea’s market operators. Market vendors in North Korea are by no means the kind of street toughs one might encounter in the black markets of other countries. Instead, they are largely housewives and mothers who make and sell to keep the family alive.

>   This is partly due to North Korean society itself. For decades, the North Korean state required every able-bodied male to be employed by a state enterprise. Married women of working age, however, were allowed to stay at home as full-time housewives.

  When Kim Il Sung’s system began to fall apart in the early 1990s, men continued to go to work. People expected that sooner or later things would return to what they thought of as “normal”—that is, to the old Stalinist system. They knew from their experience that people who have at one time shown disloyalty to the state—for instance, those who collaborated with the South Korean authorities during the Korean War—were assigned a bad sǒngbun. Thus, not only those people, but also their children and grandchildren, faced many official restrictions. Men believed that it would be wise to keep their “official” jobs for the sake of the family’s future. On top of these class anxieties, men also faced massive pressure from the state’s lower officials. An absentee worker ran real chances of being sent to a prison for a few months of “labor reeducation.”

  The situation for women was markedly different. They had spare time, and their involvement with private trade was seen as politically less dangerous—precisely because of the patriarchal nature of a society where only men really mattered. In some cases women began by selling household items they could do without. Eventually, these activities developed into larger businesses, and today some three-quarters of North Korean market vendors are women.

  As one would expect, soon thereafter, in the late 1990s, more successful businessmen (or rather businesswomen) moved from retail trade to wholesale trade. In many cases they were the members of once discriminated-against groups who benefited most from the new situation. For example, until the 1990s, it was a major handicap for any career-minded North Korean to have relatives overseas. In the 1990s the opposite suddenly became the case. Relatives overseas, especially in China, could often provide small amounts of capital (quite large by then North Korean standards), give sound business advice, or even create a formal or informal joint venture.

  A typical story is of my acquaintance, a young school teacher who, in the early 1990s, was asked by visiting Chinese relatives to buy them a large quantity of dried fish. She discovered that in merely a few days she earned well over her official annual salary, and decided to become a professional trader. Being a woman, she could leave her job without repercussions.

  By the early 2000s some wholesalers had large sums at their disposal; they sometimes invested in new types of enterprise—eateries, storage facilities, semi-legal transportation companies. Indeed, the growth of the market that was initially centered around small-scale retail activities soon produced many kinds of associated private ventures.

  The restaurant industry is illustrative in this regard. Between 1996 and 1997 the state-run restaurant industry collapsed everywhere except for a few major cities. Private capital, however, almost immediately revived it, and most North Korean restaurants are now run by private entrepreneurs. Officially, they are not supposed to exist, and such eateries are technically state-owned. According to official papers, an eatery is owned by the state and managed by the relevant department of the municipal government. However, this is a legal fiction. A private investor makes an informal deal with municipal officials, promising them a kickback, and he/she then hires workers and buys equipment. It is assumed that a certain amount of the earnings will be transferred to the state budget. In return the private owner runs a business at his/her discretion, investing or pocketing profits. A 2009 study came to the conclusion that some 58.5 percent of all restaurants in North Korea are de facto privately owned.6

  Similar trends exist in the retail industry. While the fiction of state ownership is maintained, many shops are, essentially, private. The manager-cum-owner buys merchandise from wholesalers as well as (technically) state-owned suppliers, and then sells it at a profit. The earnings are partially transferred to the state, but largely pocketed by the owner himself (or rather, herself). The above-mentioned study estimated that in 2009 some 51.3 percent of shops were actually private retail operations.7

  Transportation underwent similar changes. A large number of trucks and buses that traverse the dangerous dirty roads of North Korea are owned privately. Private investors discovered that grossly inadequate transportation facilities were a major bottleneck the emerging North Korean merchant class had to deal with. Investors began to buy used trucks and buses in China and bring these vehicles to the North. In the North, the vehicle would be registered as the property of a government company or agency. The actual owner would pay the manager of this agency an agreed amount of money, usually on a monthly basis. Interestingly, the amount of money is contingent on the agency/company type. The registration of one’s truck with a military unit or a secret police department is most expensive, while some humble civilian agency (like, say, a tractor repair workshop) would charge the least. Owners sometimes prefer to pay more, however, because military registration plates might sometimes come in handy with the police.

  Large transportation companies have developed: I met a person who owned seven trucks in North Korea. He used these trucks to move salt from salt farms on the coast to wholesale markets (incidentally, salt farms are private as well). This man also augmented his income by moving large sacks of cement that were stolen by workers from the few cement plants continuing to function in post-1994 North Korea. It was a nice income but he expressed his surprise at the ingenuity of workers who managed to somehow steal such a large amount of cement.

  Indeed, one of the major problems for the state has been the growth of criminal and semi-criminal activities. Workers and managers steal from their factories everything that can be sold on the private market. The large-scale looting of archeological sites from the Koryo (10th–14th century AD) and Choson (14th–19th century AD) periods became a problem in spite of all efforts to stop it. People responsible for antique smuggling or equipment sale often faced severe penalties; there were even rumors about public executions of such people. Nonetheless, the temptation was far too large.

  Drug production started to boom around 2005. In earlier days, drugs were produced for clandestine export by government agencies, but private business also discovered the great money-making potential of addictive substances—and officials are not too eager to enforce the bans and regulations (they usually get a slice of the profits). Private production usually concentrated on what is known as “ice,” that is, methamphetamines. Drugs were marketed domestically and also exported to China, where authorities had to step up border control. “Ice” became surprisingly popular among younger North Koreans, so much so that in 2010, foreign visitors spotted antidrug posters in Pyongyang colleges. Incidentally, around the same time, the old state-sponsored drug production program was scaled down. Frankly, the entire project obviously did the regime more harm than good, damaging its international reputation while bringing only small payoffs.8

  China features prominently in the unofficial North Korean economy (and in the official economy as well, as we will see below). Nearly all trade links either begin or end in China. Part of this trade is completely unofficial, while other transactions are entirely legal. North Korean merchants mainly import consumption goods from China—garments, shoes, TV sets, and so on. Food also constitutes a significant part of North Korean imports from China.

  Paradoxically, thanks to this, the years of crisis became a time when the average North Korean began to dress well—or, at least, better than in earlier times. In Kim Il Sung’s days most people were clad in badly tailored Mao suits or military uniforms; now, even in the countryside, people you see on the street are dressed colorfully, usually in cheap Chinese imported clothes.

  To balance the trade account, North Korean merchants export to China that which can be sold there. Apart from minerals, which are still usually handled by the state, they sell seafood, traditional delicacies, and Chinese medical herbs as well as quite exotic items—like, for instance, “frog oil,” a fatty substance extra
cted from live frogs of certain species that have to be harvested under special conditions.

  China’s ubiquity in the Northern economy has resulted in the “Yuanization” of the market: large-scale payments in postfamine North Korea are normally made in foreign currency. Dollars, yen, and euros are not unknown, but it is the Chinese yuan that reigns supreme. This situation has led to the emergence of money dealers who trade in foreign currencies, and are also sometimes known as “loan sharks,” providing loans at the annual interest rate of 100 percent or more.

  A special role in the new economy is played by a particular form of entrepreneurial activity that is neither private nor state—the so-called foreign currency earning enterprise (FCEE). Such enterprises have existed since Kim Il Sung’s era but greatly increased in number, size, and reach from the late 1990s.

  Unlike the Soviet Union, in North Korea, foreign trade was never under the exclusive control of a single state agency. In accordance with the “spirit of self-reliance,” large North Korean companies and influential state agencies were allowed to sell anything that could be sold on the international market. They would then use the earned foreign currency to import what couldn’t be produced domestically. This practice was greatly expanded in the late 1990s when provinces, ministries, and even the military and police began to set up their own FCEEs. These enterprises did not usually limit themselves to what was produced in-house, but looked for anything that could be sold for a profit.