Friday, August 01, 2008

Relative Costs of America's Choices in Korea

Cha and Kang identify six strategies for engaging North Korea. These six strategies include 1) robust defense and deterrence against the North, 2) trilateral coordination between Seoul, Washington and Tokyo on any action that takes place and 3) a continuation of the sunshine policy of family and cultural exchanges between the North and South. Cha and Kang also advocate 4) continuing unrestricted food aid to the North, 5) encouraging China to use their leverage on the North and 6) making it clear that retaliation for bad behavior on the part of the North Koreans would be swift. Before I can answer the question of which of these strategies would be least costly to the US, I must first compare the absolute cost of each.

For the US, participating in the robust defense against the North is just a small marginal cost on the overall defense budget. There are only approximately 30,000 troops stationed in the ROK, a significant portion of whose billeting and upkeep is paid for by South Korea. The attack aircraft and bombers that support the troops have other missions in addition to the South Korean mission and the remaining of the US Armed Forces that remain on call all have other missions as well. If Korea suddenly became a non-issue, the US would not see much savings because the cost, at the margin, for South Korean defense assistance is not that great, given the myriad of other defense responsibilities the US has in the region and around the world.

Trilateral coordination is another policy that does not cost anything at the margins. Already, the US, Korea and Japan are robust political allies and trading partners with massive positions in each other’s economies. Since there are numerous engagements on many different levels among all three countries, keeping North Korea on the agenda represents a policy of almost no recognizable cost to the United States. The benefit is quite substantial to this type of collaboration since South Korea and Japan recognize a North Korea to be a much more compelling threat that does the United States. Yet, since the US is willing to engage in and be an active part of the strategy to deal with the problems, South Korea and Japan are very grateful for the assistance. That gratitude is expressed through support of other US initiatives and requirements around the world that Japan and the ROK would not be a part of, except for their relationships with the US. For instance, both the ROK and Japan have been part of the coalitions in Iraq and Afghanistan and have provided aid in reconstruction. Certainly, neither nation would have, had it not been for their relationships with the US.

The sunshine policy is another area virtually without cost to the United States. The US itself uses cultural engagement with enemies. In fact, at the time of this writing, the Iranian Olympic basketball team is traveling the US playing tune-up games against American competition prior to the Olympics. The cost to this type of engagement is negligible, and the exchanges are important to Koreans on both sides of the DMZ. How tangible the benefits are to such exchanges is difficult to ascertain, but since there is not downside, other than the potential for espionage, which exists anyway, these exchanges represent a low to no cost advantage to the US. 

Unrestricted food aid is a costly endeavor for the United States. With world population increasing and domestic US demands for bio-fuels increasing as well, the absolute value of US food stocks increases with its scarcity. The US government must pay for food that it then distributes to an enemy without requiring payment. Since North Korea is relieved of the responsibility to feed itself, it then has more resources to direct towards its nuclear and conventional forces. So, the US faces a situation in which the US taxpayer subsidizes the nuclear program of the North Koreans. This policy of food aid thus represents an enormous direct cost to the US and an even larger diplomatic and military cost since the improved North Korean forces continue to represent a threat that the US is supporting.  
Encouraging China also has hidden costs for the US. China is a ruthless bargainer and does not sell its supposed influence in North Korea for free. China demands concessions in other areas, like eliminating freedom of navigation transits in the Bohai Gulf, reducing engagement with Taiwan and eliminating Western criticism of Chinese atrocities inside the Middle Kingdom and in Africa. Also, the food aid that the West provides North Korea relieves China of some responsibility to feed and house economic migrants. Although encouraging China has many costs, there do not seem to be many tangible benefits from Chinese engagement with the North Koreans which suggests one of two things. Either China does not have any influence with North Korea, making any cost to the US simply not worth it at all. Or, China takes what the US and the West offers, and does not utilize the leverage it actually does have, making the US a sucker in the bargain.  

Blustering threats about retaliation directed towards North Korea have an enormous cost to the US. Idle threats discount American credibility and encourage bad behavior on the part of the North Koreans. Further, threats that are not carried out make the whole rationale for maintaining US forces on the peninsula moot. If the US is not going to use the forces arrayed there, then the cost of maintaining those forces, albeit marginal, is not worth it. Similarly, making threats that are not carried out encourages North Korea to continue pushing the frontier on what it can get away with. North Korea detonates a nuclear weapon, exports drugs to the US, and engages in massive state supported currency counterfeiting, yet the US never acts in response. The cost of idle American threats goes up as North Korea continues to engage in behaviors that should provoke a response of the US, but do not.

The most costly engagement strategy for the US is the policy of unconditional food aid to the North. The raw cost and the subsidy from the American taxpayer to the North Korea war machine make it doubly expensive. Clearly, the least costly engagement strategy for the US is the sunshine policy. People chatting, singing together and competing in tae kwon do is cost free, and has the potential, as yet unrealized, of actually bringing an end to the standoff on the peninsula.