On January 1, 2019, Erudite Risk published a report called “North Korea Crisis, 2019 Forecast.”
The takeaway line for this report was simply this: 2019 is going to look more like 2017 than 2018.
We based this prediction, made in December of 2018, on several factors including the underlying logic driving the crisis, the current goals of each of the parties, the history between the parties, and key leadership personalities.
Now five plus months into 2019, we see nothing that would indicate that this prediction isn’t coming true. With each passing development, we see the tyranny of the underlying crisis logic reapplying itself to a situation that has been largely immovable for more than 65 years.
What we’re witnessing now
NK seems to be slowly pivoting from diplomacy and ratcheting up the intensity of its messages to the US: rebuilding the launching pad, a pivot to China, a pivot to Russia, and two missile tests. This has been accompanied by vitriolic speech and denunciations of all US and ROK personnel except the US President.
How did US react after each message? The first ones didn’t seem to register at all. The missile tests finally made a mark: their importance was downplayed by the US President while the launches were decried by his staff. If NK’s recent actions were simply part of a program to extract the concessions it wants from the US, then the US response to what has happened so far virtually guarantees NK will continue to increase pressure, increase the violence threatened by its provocations, and the anger of its statements.
Why does it have to be like this? Why can’t we simply sit down and make an agreement amenable to both parties? Why are we once again headed down a path no one really wants to go - a path proven to hold no good options for resolving the crisis? And why we were always more likely than not to end up here? Why does sit-down diplomacy between North Korea and the US always fail?
First, let’s review the underlying logic of this crisis. Understanding the logic of the crisis is important because it defines the underlying factors that are driving the actions and decisions of the key parties, and it is these actions and decisions that are making the search for a solution so difficult. The underlying logic of the crisis pushes the crisis forward and also provides an explanatory framework against which we can evaluate triggers and indicators. It is the underlying logic that drives North Korea and the US toward higher tensions and potential conflict and that represents the basket of constraints that each party is always bumping up against. Furthermore, any action, concession, stance, or pronouncement that doesn’t change or remove one of the underlying driving forces of the crisis is ineffective in terms of actually solving anything.
Individual diplomacy initiatives, shows of force, provocations, and summit handshakes are indicators of key player intent only. They may make tensions go up or down, or move us closer or further away from conflict, but may not actually move us any closer to solving the problem. Therein lies the main problem over the last 65+ years: if we simply focus on managing what we directly see in front of us, on putting out fires, we stay in a permanent risk state where new fires will continually start. These fires are distractions. They don’t get us any closer to solving the problem, but they present a massive risk of accidentally ending up in a very horrible conflict.
We must look at the quasi-stable end game of long-term deterrence of North Korea’s nuclear program in that light: as a continuance of problem management we’ve been engaged in since the end of the Korean War. Deterrence is probably where we’ll end up - because we’re already there - but don’t expect deterrence to make things quiet. We have already had deterrence for more than half a century and yet here we are again today living under the threat of conflict. Furthermore, deterrence will only work in this crisis if North Korea wants to be deterred. So, deterrence will be as loud or as quiet as North Korea wants it to be. NK leadership has to be satisfied that they are safe in deterrence and also allowed to conduct the business of developing their own economy. That is to say, we won’t be able to deter them and punish them at the same time; that approach is what got us here and will keep us here. What may work in the short-term is not a long-term stable approach.
The Underlying Factors of the Crisis
1 We’ve been here before so we have a lot of preconceived notions.
As for crisis tensions, diplomacy, and agreements, we’ve been here before, and failed before. The fact that tensions between the US, NK, and SK have been going through iterations for so many years is the very thing creating a lot of the logic driving the current crisis.
For many in South Korea, there is a normalcy bias - built up scar tissue - that colors their view of how to proceed. The average Korean resident feels that worry about an NK conflict and the associated crisis management planning is a waste of time because there will be no war. They feel been there, done that, when it comes to high tensions and tough talk.
The idea that North Korea is a purely rational actor is fairly new for many in the US (where the idea that NK was ‘crazy’ was more commonly held (partly cultivated by the North itself)), but in South Korea it has always been a given. Because North Korean leadership is seen as rational and rationally self-interested, there is a widespread belief that North Korea will never start a war because it is not in their self-interest.
For the US, the fact that we’ve been here so many times, and failed at diplomacy so many times, drives a lack of trust in North Korea’s ultimate intentions. Been there, done that.
2 We’ve never been here before.
This crisis iteration is completely different than any we’ve ever experienced before.
The main unique element this time is North Korea’s ability to directly attack the US mainland. A direct threat to the US has never been a factor in strategy or decision making before. Previously, it was always about protecting South Korea and Japan. Now that the main goal is protecting the United States, itself, the views from the Oval Office and the Pentagon, look very different. US military leadership has even stated that sacrificing South Korea or Japan is acceptable if it keeps the US safe.
3 US and Allies are no longer on the same page.
The US approach to prioritizing its own security goals over those of the allies, has made explicit the fact that the goals of the allies (South Korea, the United States, and Japan) no longer perfectly align. There is some overlap, but there is also significant divergence. Unlike previous crisis iterations, the US and South Korea are no longer on the same page and South Korea feels significantly hamstrung by being forced to follow US rules of engagement with the North.
It is the US that wants denuclearization. The South Korean administration just wants peace on the Peninsula. Although it gives lip-service to denuclearization, that goal is a distant second to peace. If denuclearization can be had with peace, fine. If it cannot be had with peace, they’ll take peace. President Moon has said as much over and over. It may not be peace at any cost, but it is peace at most costs. The US wants denuclearization because it believes that is in its security interest. South Korea wants peace because it knows that is in its security interest.
Even Japan has had to worry that the US is no longer negotiating and projecting power on behalf of its allies, but rather, doing so solely for itself, and may be willing to conclude deals with the North that sacrifice the security interests of Japan. This realization has driven Japan’s Prime Minister Abe to take a much more proactive approach toward influencing US strategy and positions vis-a-vis North Korea.
Furthermore, Japan and South Korea are not on the same page either. South Korea’s Moon Administration has sought rapprochement and peace, while Japan’s Abe has tried hard to keep military and sanctions pressure on the North, believing that approach to be the only rational approach toward a country that has kidnapped its citizens and repeatedly threatened it with destruction.
Over the course of the current crisis, both South Korea’s President Moon and Japan’s Prime Minister Abe have found that, much to their chagrin, influencing President Trump’s approach to the crisis is difficult, if not impossible.
4 There are multiple game clocks and they are always ticking.
With each tick of the clock, the US hears a North Korea that continues to expand its military and nuclear capabilities. Work on the nuclear program continues. Work on the ballistic missile program continues. Recently, renewed provocations by the North, though small in size, have been intentionally designed to demonstrate to the US that the clock is, in fact, still ticking. Previously unseen missile systems have been tested and more might be on the way.
With each tick of the clock North Korea sees continuing sanctions it is desperate to remove. Pronouncements from the North from the beginning of the year until now have demonstrated that NK leadership won’t simply wait and allow the US to bleed it dry. So long as sanctions remain in place, North Korea must continue raising the stakes to get them removed. With each new provocation, we get higher tensions and NK gets more of the attention they desire.
The process of raising tensions won’t stop unless some sort of deal is made because NK leadership can’t afford for it to stop: sanctions are a clear threat the survival of the regime. A suspicious North Korea (and suspicious they are) would consider the last year of diplomacy nothing but a time-buying maneuver to allow the sanctions to soften up the North. The view from Pyongyang is one of strategic patience being played in Washington, different than that of Obama, worse than that of Obama. Trump’s advisors have begged him from the beginning to give sanctions time to do their work. He has done that and is still doing it. For North Korea to simply sit back and let the sanctions continue to bite is to allow the US administration to win. They have repeatedly stated, since the beginning of 2019, that they will not do that. They will not simply wait to die.
If there is no flexibility in the US position and DPRK leadership judges that there won’t be any for the foreseeable future, it will be clear to them at some point that smaller threats and provocations, which only threaten South Korea or Japan, aren’t satisfactorily moving the needle. NK will then cross a Rubicon of sorts and be forced to (from their point-of-view), once again, perform tests that are seen as direct threats to the US mainland. When North Korea crosses that line, diplomacy will be fully dead and we’ll be left with few options and no good ones.
It is part of the perverse logic of the crisis that each time Trump downplays the new actions and provocations of the North listed above, it almost guarantees North Korea has to conduct another, more provocative action. They seek not only attention, but to move the US to feel threatened enough to not only return to the negotiating table, but to make a deal that removes the sanctions.
The ticking clock makes the need for rapid action on diplomacy crucial to preempt a descent into 2017 level crisis. Simply waiting the North out is not an option, because North Korea has made it clear that it will not tolerate that strategy.
5 A Huge Power Gap
If the US expects to disarm North Korea, its negotiation style should not be authoritarian or inflexible but several factors, chief of which is the enormous power gap between the US and North Korea, naturally push the US into that mode. More on that in a moment.
6 The US is a democracy and as such, no deal is final.
“Those promises were not my promises.” Democracies change leaders. New leadership is not married to the previous administration’s policies and initiatives. North Korea need look no further than Iran to see just what can happen to a deal it makes with the US when power changes hands. Security guarantees? What security guarantees?
Democracies also have more dispersion of power, meaning more variance in goals. The goal today is denuclearization, but once the needle moves on that, don’t expect it to be the only goal. North Korea has an abysmal human rights record. Don’t expect many lawmakers in the US to expect to honor an agreement made with a dictatorship once they no longer have to, in other words, once they have the North’s nukes.
7 Persistent Lack of Trust
Lack of trust is the fundamental factor driving so much of what we see. North Korea requires full security guarantees from the US because of lack of trust. NK wants a staged approach because of lack of trust. NK refuses to accept Trump’s offers of a bright economic future because of lack of trust. The lack of trust is so strong that there is little the US can offer that North Korea would believe it would ultimately be allowed to receive. Lack of trust ensures that the better the US offer, the less trust there is. Even then, offers from the US haven’t been very enticing so far.
Conversely, lack of trust means the US wants to see full and complete denuclearization before it even begins to offer concessions.
This is why we hear so often about “trust-building steps.” We hear about them all the time but they are, so far, still largely mythological creatures. Trump’s unilateral decision to suspend US-ROK exercises was a perfect example of a trust-building measure. North Korea has also destroyed various sites it claims were part of its weapons program. These measures were meant to build trust, but since no real trust existed between the parties to begin with, even these measures were simply dismissed by the other sides as ruses having now real meaning, and no trust was built.
There are many more, smaller factors which we would normally include as part of the underlying logic that we cannot address in detail here, but the above are the most important ones. Some of the other small factors include:
- The major leaders are no longer new. New leadership is unpredictable. That unpredictability created hope of a breakthrough on all sides. Now, leadership is not so new and people are coming to know what their characteristics are and therefore, what the bounds of possibility are.
- Trust deficit among the allies. Conflicting goals mean not everyone has everyone else’s best interest foremost in mind when making policy.
- The (real) roles of China and Russia
- Inflexibility of stances. No new ideas. Wasn’t it Einstein who said that only crazy men keep doing the same things and hoping for different results?
- No ability to compel follow-through on agreements. In theory, we can make any agreement we want. That doesn’t mean the agreements will be actually executed - by any side. That fact makes it difficult to even make an agreement.
- Diplomacy has a loop limit. After reaching a certain number of failed tries, diplomacy fatigue sets in and the parties have no political capital to pledge to continue negotiation efforts.
Putting It All Together
Make no mistake, the power gap is giant. If this were a card game, the US would hold 50 cards and North Korea 1. The enormous power gap explains a lot of the thinking that separates NK and the US.
- The power gap leads to a difference in evaluation of the relative value of concessions between the US and the DPRK. What the US considers to be a small or meaningless concession, the North considers to be huge. This is entirely because concessions must be evaluated in light of each party’s ability to leverage them into lasting advantages. The US is operating with so much leverage that any concession North Korea makes may be the last concession it makes. In other words, North Korea sees every straw as potentially the one that will break its back.
- The power gap gives teeth to the lack of trust problem. Trust is most required when one party has no way to force the other party to comply with its obligations. It’s like making a business contract where there are no courts or other authority to back the agreement up. In this case, neither party can force the other party to comply all the way through the agreement, but noncompliance halfway through would leave the US in a much better situation than it would leave North Korea. The US can easily walk back its concessions: reapplying sanctions and redeploying troops. North Korea cannot get back information on its weapons programs that once divulged leads to permanent targeting and permanent learning by the US. Furthermore, should the US at any point in time learn the threat is not as dire as it suspected, further compliance with the deal would be politically more difficult to come by.
- It is significantly more difficult for North Korea to walk back its own concessions following non-compliance. It can restart nuclear programs, etc. but these things take time and are difficult to execute, especially in secret. The real issue for North Korea is not walking back its concessions, but lying about making them in the first place. It is much easier for the North to simply make meaningless or deceptive concessions, give false information and declarations, and otherwise hide the true nature of their programs until such time as they either cannot do so any longer or find it acceptable to divulge true information. The problem is that from their point of view, because of the power gap and the lack of trust, they may ‘never’ find it acceptable to act sincerely and truthfully. The power gap, combined with the lack of trust, means North Korea finds it incredibly difficult to comply with even the smallest of promises it makes.
The lack of trust combined with the power gap makes:
- NK requires full and complete security guarantees and benefits (despite asking for a step by step plan) because the power gap means that ANY concession NK makes is a potentially life threatening one. Even if the US were to agree to a step by step program, NK wouldn’t be able to comply. NK has so little to offer that it is like a nearly bankrupt individual with $1000 of cash in the bank and the promise of no further money. Not knowing what the future is going to look like exactly, means needing to keep as much cash as possible to service unexpected expenses. If that individual then gets a bill for $10 (a step by step concession), he can’t afford to pay it, because he might need that money in the future to pay another bill. There is still $1000 in the bank, but for all intents and purposes, bankruptcy has already set in. NK can make a deal for stepwise concessions, but it can’t afford to comply with any deal it makes. This is all because it doesn’t trust that the US will follow the deal all the way through once it no longer is forced to.
- The US is on the other side of the equation. It doesn’t want to offer any concessions in a stepwise deal because it doesn’t believe North Korea will follow all the steps to the end. It believes North Korea will renege on future steps and then the US will have already granted concessions such as sanctions relief or cash. This is the definition of getting hoodwinked President Trump has repeatedly blamed past US presidents for falling victim to.
- If there were more trust, one side or the other would be willing to at least embark on a stepwise program.
- If there were more of a power balance, NK would feel less nervous about complying with ANY agreed to step and the US would feel more need to be flexible. As things stand today, the US feels perfectly willing to force the issue, through Trump’s own version of strategic patience: bleed the North dry and wait for 1 a coup or 2 collapse or 3 NK to come to the negotiating table with no demands of its own.
- From NK’s point of view, they not only need to trade their 1 card (nuclear weapons) for the other 50 the US holds, but they must do so all at once, otherwise the regime is exposing itself. NK thinks that if the US is unwilling to be flexible in offering more cards up front, they must be forced to do so through increasing belligerence. After all, it was that belligerence that brought them to the table in the first place.
All of the above is the underlying logic driving the crisis and the reason we are seeing tensions rise again.
Erudite Risk offers risk management and security-related professional services for multinational companies operating in the Asia-Pacific region. With operations in India, Korea, and Singapore, Erudite Risk is ready to help you meet the challenges of Asia, the most dynamic and challenging business environment in the world.
Rodney J. Johnson is President of Erudite Risk. He has lived in Asia for most of his adult life, but still longs for good Mexican food.
Read a related post at The Erudite Blog:
While recent developments are promising, it is important to keep in mind that nothing of real import has changed as of yet and that we are a long way from reaching a stable end to this crisis.