What really is North Korea?

The world will be watching with fascination when the planet’s best-known head of state, US President Donald Trump, greets and meets perhaps the world’s most mysterious head of state, North Korean leader Kim Jong-un, in Singapore on Tuesday.

And North Korea is as mysterious as its head of state. Trump – and perhaps even Kim – might be hard put to define what kind of a country North Korea actually is. Is the isolated, insulated and heavily militarized nation of 25 million people communist or monarchical? Is it a socialist command economy or an emerging capitalist market economy? Is it a strong state or a weak state?

In fact, North Korea is a mass of contradictions and ironies that defies easy categorization or simplistic media definitions.

An undeclared totalitarian monarchy

What North Korea is not is irrational or even lunatic – labels widely bandied about in media and even in political circles. “Kim Jong-un is no madman, he is very smart, very rational,” said Go Myung-hyun of the Asan Institute in Seoul. “He can use the reputation of madness and unpredictability for his own leverage the way Trump uses it.”

“When challenged, people who say this tend to fall back on atrocious deeds like the camps, the murder of Kim’s uncle and the repeated missile and nuclear testing,” added Rob York, a North Korea watcher and PhD candidate at the University of Hawaii. “All of these are evidence of Kim’s rotten state of character, but not his [ir]rationality.”

A common media mischaracterization of North Korea is that it is a “communist” state. It is not – either de facto or de jure: The country dropped communism from its constitution in 2009. Today’s North Korea is a confusing hybrid of multiple, sometimes contradictory, ideas and concepts.

“It is a hereditary, post-communist dictatorship,” said Andrei Lankov, a Russian expert on North Korea who has studied in Pyongyang and who now teaches at Seoul’s Kookmin University. But while North Korea has mutated beyond communism, carry-overs linger – such as a “tough and efficient system of social control,” that makes it so successfully totalitarian.

“One heritage of communism is the ability to control every person in the country, from who they are sleeping with, to what they are eating,” Lankov said. “In this sense, North Korea is a Stalinist state.”

The personality cult surrounding the Kims has arguably gone further than Stalin’s – or any other dictators. But with North Korea being the first communist state ever to institute hereditary succession – Kim Jong-un’s father Jong-il succeeded national founder Il-sung, who died in 1994, as the second member of the dynasty at the helm – Lankov adds another definition: “an undeclared monarchy.” Go agrees. “It is an absolute monarchy in many ways – it has all the elements of a dynastic system,” he said.

Kim I, Kim II and Kim III

And arguably, North Korea was never truly communist in the first place. While communism was an internationalist concept – “Workers of the world, unite!” – North Korea’s most strident ideology, closely interwoven into the myths of Kim I, Kim II and Kim III, was nationalism. “The legitimacy of the regime comes from founder Kim Il-sung, who derived power from nationalist credentials,” said Go.

Kim, a guerrilla who battled Imperial Japan in Manchuria and northern Korea during the 1930s, was – at least, according to propaganda – descended from a long line of Korean fighters. “His parents and grandparents were the purest of nationalists, who always fought against invaders, who were preservers of the national spirit,” Go explained.  “So, North Korea is a monarchy based on a rigid nationalist ideology.”

Daniel Pinkston, an international relations expert with Troy University in Seoul, agrees that North Korea is a hybrid of different systems – so while North Koreans may claim their state is unique, “… it is really an off-the-shelf amalgamation of different things.”

Elements of pre-modern Korean culture buttress the system. “Confucianism has this idea of a prescriptive formula of how relations were supposed to be maintained – the king and subject, husband and wife, and so on, very proscribed roles regarding behavior,” Pinkston said. “So, the power structure is enforced by traditional cultural values.”

But Korea’s last royal kingdom, Joseon, was not militaristic; North Korea is – in spades. The most iconic TV footage from the secretive state covers military parades; the key policy line of Kim Jong-il’s tenure was “songeun,” or “military first”. North Korean maintains a 1.1 million strong army and has expended scarce resources on strategic weapons development. The US military threat – a cornerstone of near-paranoid state propaganda – is vital for the regime, which can claim to be the defender of its people.

Yet another element to consider is the criminal acts – ranging from dollar counterfeiting to cyber robbery – that Pyongyang is compelled to engage in to undercut the sanctions it has been subjected to since 2006. “The term gaining currency among some of the commentariat is ‘gangster state’ or ‘mafia state’,” said York. “North Korea’s ongoing effort to extort other countries for whatever it can get – from foreign aid to foreign investment to the bill for their hotel rooms – lends itself rather easily to this designation.”

Even religious elements have been incorporated. “There is the religious part – the faith; the near-divine status – like the Japanese royal family and emperor,” Pinkston said of the Kims’ status. “And there are attributes from Christianity, like Christian symbolism.” The latter includes a star shining over the birthplace of second-generation leader Kim Jong-il, which is widely featured in state propaganda.

Is there a comparative model? The most notable elements of the North Korea state – its ruling dynasty; its aggressive nationalism; its militarized society; its controlling authoritarianism – closely resembles those of the nation it feared and despises: Imperial Japan. This interpretation has been persuasively made by iconoclastic writer B R Myers in his influential book The Cleanest Race.

Command economy to quasi-market economy

Yet even if North Korea’s powerful bureaucracy of state control makes it Stalinist in the political sense, it is not so on the economic sense.

North Korea’s command economy collapsed in the 1990s, when its communist partners in Europe converted to capitalism while murderous famines wracked the state, killings hundreds of thousands – some estimates top a million. With the state distribution system failing, desperate North Koreans responded by creating black markets for essential items like foodstuffs and medicines.

However, the markets survived the famine, despite a number of efforts to reign them in – notably a disastrous currency revaluation in 2009. They are now a critical component of the North Korean economy, widely patronized by citizens nationwide.

“A Stalinist state is about central control, a highly centralized command economy,” Lankov said. “They don’t have that any more, they have lost the command economy.”

“It is a mixed economy that has transitioned very far from the command economy it once was,” said Andray Abrahamian, a research fellow at CSIS. “It’s better to think of it as a market economy with a huge state sector that is in some ways integrated into that economy and in some ways separate,” Abrahamian, who has taught business skills extensively to North Koreans under the aegis of Singaporean NGO Chosun Exchange, continued. “So, large state-owned enterprises have to use market principles to survive and thrive, by and large. But also much smaller enterprises get created and also compete. Awkwardly, they don’t really recognize private ownership yet, so much happens in a grey area.”

The legal gray zone the markets – which operate openly, so cannot be considered “black” – exist and grants the state the ability to control and extract from them, such as by selling rights to stall space, a system the Asan Institute’s Go calls “rentist.” Yet it works both ways: While the state, in proper socialist fashion, officially owns productive assets, many citizens operate these assets for personal benefit – such as the fishing fleet in the northeast, whose crews sell their catch to China.

Most goods in the markets come from China, which has created another quasi-legal area: Cross border smuggling-trade-distribution networks, in which border guards are reportedly active players. Due to these many legal gray areas, bribery and corruption is rampant – but the state still wants control.

“North Korea is not capitalist, it is ‘market socialist’,” said Choi Jin-wook, a North Korea expert at Japan’s Ritsumeiken University. “They want to control the economic system, they still want to plan, to have state influence.”

Amid this uneasy dynamic, the markets, which now offer everything from foodstuffs to fashion and electronic goods, have helped cushion North Korea against international sanctions by making the economy more efficient and resilient than it was under state control.

The ‘money masters’

Scholars including Lankov believe that North Korea – which does not publish economic data – is growing at about 3% per year. This suggests that ordinary North Koreans are now more prosperous than at any time since the late 1960s, the heyday of the command economy and the last time North Korea’s GDP was larger than the South’s.

The irony is that while the market removes pricing and distribution from state hands, the regime can use the markets to safeguard itself.

“The interesting aspect of the political economy is that regime loyalists are granted property rights to engage in market activities,” said Pinkston. “Whoever has the mobile phone business, or the used car smuggling business, controls that and gets revenues, and the state can control those property rights.”

In this situation, power players – donju, or “money masters” – have appeared. Many engage in public-private partnership projects. Ri Sol-ju, Kim’s wife, is reputed to be one, and it is no surprise that many of Kim’s flagship economic projects are such playgrounds for the wealthy such as ski and beachfront resorts.

This explains Kim Jong-un’s apparently pro-market stance. “Kim Jong-un seems a little more comfortable with market activities than his father was,” Pinkston added. “He appears to be adept at who gets rights to buy and sell; whoever has those lucrative opportunities is not going to be a dissident.”