'Social justice' comes to North Korea?

Dramatic proof that those who abhor inequality can never be satisfied comes from North Korea, where the government of Kim Jong-il has recently confiscated a substantial portion of the wealth built up in recent years through toleration of small private markets. In order to combat the extreme famine that killed a million or more North Koreans in the 1990s, small local markets selling produce, and other slight reforms were made to the rigidly communist economy.

As markets do, wealth began to be created through individual initiative motivated by self-interest. Over time, traders managed to amass enough wealth to pay for refrigerators, color TVs, and a few other baubles considered commonplace in South Korea and throughout the industrialized world. Such accumulation of "wealth" became intolerable, so the NK government began implementing a "currency reform" by which the NK won was redenominated by a factor of 100, and all currency was to be exchanged for new won notes. Thus, a 100 won note would be exchanged for a 100 new won n0te.

Wealth confiscation was the goal of limiting the total amount that could be exchanged to 100,000 won (about $700 at official exchange rates). That limit has reportedly been raised by 50,000, as protests have begun to break out. Any wealth in excess of that modest sum simply vanished, in other words reverting to the hands of those who print the currency.

Good Friends, an aid group in Seoul, said cases of heart attacks and suspected suicides were reported because of lost savings.

Open Radio for North Korea, a broadcaster and website that collects information from informants there, said two money-changers were executed on Friday in Pyongsong near Pyongyang for illegally exchanging currency.

They attempted to exchange a sum of old money greater than the prescribed limit by using others to conduct transactions for them, it said.

The world's most repressive regime does not tolerate protest, so if it is unable to quell the unrest, its very existence may be threatened, or so it will think. In such a brutal regime, once repression appears ineffective, the dam can break.

The already shaky foundations of the regime are, in fact, the reason why this wealth confiscation was undertaken. South Korea's Chosun Ilbo, a major daily, reports:

Kim, who suffered a stroke in August last year, seems determined to hand over power to his son in a third-generation dynastic succession. To do that, he needs to get an iron grip on the regime as the country disintegrates amid endemic poverty aggravated by international sanctions. But widespread corruption means North Korea's emergent wealthy class, which has grown since the mid-1990s, is not easily subdued by recent heavy-handed crackdowns on freedoms. "There are numerous cases of wealthy North Koreans paying off government officials and evading government steps to control them," a South Korean government official said.

In a recent bid to rein them in, the regime in January limited the types of goods people can sell in markets to only homegrown produce, meat (except beef) and clothing. Manufactured goods and imported products must theoretically be sold in state-run stores. The measure was tantamount to a closure of the street markets. But the orders were met with public outrage and failed.

Prof. Nam Ju-hong of Kyonggi University says Kim has "declared war against market forces" with the drastic currency reform, because his efforts to control trade had failed.

In other words, the existence of any independent power in the hands of anyone outside of the inner circle of the regime threatens the Kim family's monopoly on power. The senior Kim is attempting to remove wealth because it threatens his tyranny. If people can pay bribes, and if those who control the populace on his behalf become unreliable, or dependent on private wealth for their welfare, then all is lost.

The same principle of control animates those who demand "social justice" in nations less repressive than North Korea. They claim to work on behalf of the poor, society's "victims." But in fact what they accomplish is the weakening or even removal of the power that accumulates to individuals when they are allowed the economic liberty to capitalize on their diligence and wit. Markets and liberty are inseparable concepts.

Tyrants hate markets because they are hard to control. "Social justice" is just the latest slogan to disguise a mindset that desires to control the lives of others.

If Kim does not fall and his son inherits his communist throne, then famine appears likely again for North Korea.
 
Dramatic proof that those who abhor inequality can never be satisfied comes from North Korea, where the government of Kim Jong-il has recently confiscated a substantial portion of the wealth built up in recent years through toleration of small private markets. In order to combat the extreme famine that killed a million or more North Koreans in the 1990s, small local markets selling produce, and other slight reforms were made to the rigidly communist economy.

As markets do, wealth began to be created through individual initiative motivated by self-interest. Over time, traders managed to amass enough wealth to pay for refrigerators, color TVs, and a few other baubles considered commonplace in South Korea and throughout the industrialized world. Such accumulation of "wealth" became intolerable, so the NK government began implementing a "currency reform" by which the NK won was redenominated by a factor of 100, and all currency was to be exchanged for new won notes. Thus, a 100 won note would be exchanged for a 100 new won n0te.

Wealth confiscation was the goal of limiting the total amount that could be exchanged to 100,000 won (about $700 at official exchange rates). That limit has reportedly been raised by 50,000, as protests have begun to break out. Any wealth in excess of that modest sum simply vanished, in other words reverting to the hands of those who print the currency.

Good Friends, an aid group in Seoul, said cases of heart attacks and suspected suicides were reported because of lost savings.

Open Radio for North Korea, a broadcaster and website that collects information from informants there, said two money-changers were executed on Friday in Pyongsong near Pyongyang for illegally exchanging currency.

They attempted to exchange a sum of old money greater than the prescribed limit by using others to conduct transactions for them, it said.

The world's most repressive regime does not tolerate protest, so if it is unable to quell the unrest, its very existence may be threatened, or so it will think. In such a brutal regime, once repression appears ineffective, the dam can break.

The already shaky foundations of the regime are, in fact, the reason why this wealth confiscation was undertaken. South Korea's Chosun Ilbo, a major daily, reports:

Kim, who suffered a stroke in August last year, seems determined to hand over power to his son in a third-generation dynastic succession. To do that, he needs to get an iron grip on the regime as the country disintegrates amid endemic poverty aggravated by international sanctions. But widespread corruption means North Korea's emergent wealthy class, which has grown since the mid-1990s, is not easily subdued by recent heavy-handed crackdowns on freedoms. "There are numerous cases of wealthy North Koreans paying off government officials and evading government steps to control them," a South Korean government official said.

In a recent bid to rein them in, the regime in January limited the types of goods people can sell in markets to only homegrown produce, meat (except beef) and clothing. Manufactured goods and imported products must theoretically be sold in state-run stores. The measure was tantamount to a closure of the street markets. But the orders were met with public outrage and failed.

Prof. Nam Ju-hong of Kyonggi University says Kim has "declared war against market forces" with the drastic currency reform, because his efforts to control trade had failed.

In other words, the existence of any independent power in the hands of anyone outside of the inner circle of the regime threatens the Kim family's monopoly on power. The senior Kim is attempting to remove wealth because it threatens his tyranny. If people can pay bribes, and if those who control the populace on his behalf become unreliable, or dependent on private wealth for their welfare, then all is lost.

The same principle of control animates those who demand "social justice" in nations less repressive than North Korea. They claim to work on behalf of the poor, society's "victims." But in fact what they accomplish is the weakening or even removal of the power that accumulates to individuals when they are allowed the economic liberty to capitalize on their diligence and wit. Markets and liberty are inseparable concepts.

Tyrants hate markets because they are hard to control. "Social justice" is just the latest slogan to disguise a mindset that desires to control the lives of others.

If Kim does not fall and his son inherits his communist throne, then famine appears likely again for North Korea.
 

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