The War On False Consciousness

"Market Reforms" North Korea-style: North Korea Razes Unofficial Markets

North Korea closed the country's biggest unofficial market in June, a South Korea-based organization that tracks economic activity in the North learned this week, a significant step in a government effort to slow the spread of market activities there.

An estimated 30,000 small business were believed to be operating in the market in Pyongsong, on the outskirts of the capital city of Pyongyang, according to Network for North Korean Democracy and Human Rights, or NKNet. Merchants there sold items such as food, clothes and Chinese-made goods.

The market is apparently the latest to fall victim to a government antimarket effort that began in 2005 and accelerated last year. The effort has been openly resisted by many North Koreans and posed a challenge for dictator Kim Jong Il's government as he reasserted authority this year after apparently suffering a stroke a year ago.

30,000 businesses?! That's not a market; that's a small city. It's also a stunning symbol of the North Korean people's rejection of their government. The market grew so large because of its location. It was convenient to residents of Pyongyang, as well as people from surrounding provinces, who aren't allowed to go to Pyongyang. That's right, most North Koreans are not allowed to enter their own capital city, and the lucky elect that is allowed to live there doesn't want to stay. The "public option" in action.

The markets are a recent phenomoenon, a result of the collapse of the state's control over the food supply after the famine of the late 1990's and its decision to pursue arms development.

The North Korean government intensified its spending on its military and weapons in the 1990s as a multiyear famine ended its control over food supply and other key parts of the economy. Ordinary citizens began trading food and goods themselves, leading to the rise of an unofficial market economy that was tolerated by the government until 2005.

In that year, the government tried to force most adults out of markets and into jobs run by the state. Last year, the effort intensified with an announcement that all general markets would converted to food-only markets that open once every 10 days.

The conversion attempt has failed, according to organizations and analysts in South Korea, as traders and refugees who are able to get to China have reported that sizable markets remain open in most towns and cities.

And, of course, the state hates the market because "society" does not benefit. Sure. I will only believe that statement if you substitute "state" for "society."

A provincial secretary declared the market "serves no benefit to society" since profits are kept by individual entrepreneurs, NKNet reported. Two smaller markets have formed in Pyongsong since June but many merchants are selling and trading from home.

Lim Soo-ho, a specialist on North Korea market activity at Samsung Economic Research Institute in Seoul, said authorities have long targeted the Pyongsong market because Kim Il Sung, North Korea's founder and the father of Kim Jong Il, sought to build a park there before his death in 1994.

"North Korea has tried to close the market several times," Mr. Lim said. "This time, some guy with a lot of power from the central authority pushed the closing and he succeeded."

Only a central planner could believe that getting rid of these markets can create a social good. Hey, how about letting them thrive and then collecting taxes from the income earned there? Or is that too "Anglo-Saxon" to be of any use? No doubt these markets are run by "racists," "brown-shirts," "tea baggers," and the like.

I guess you could say that the persistence of these North Korean entrepreneurs is testament to the human spirit, freedom, and capitalism. Even in the most controlled economy in the world, one that promises Equality, Safety, and Social Justice, there are those who would just as soon go their own way. But, I am in a pessimistic mood today, so I will point out that if these North Korean shopkeepers had the luck to be born 50 miles to the south, they could be CEO's of multi-national conglomerates, rather than obscure traders improvising a barter economy on the fringes of a Stalinist state. A market economy allows us to make the most of our opportunities, but you first have to be lucky to have been born into one in the first place.

And, there is also the depressing persistence of the statist ideal: the desire of an elite to control everything, rather than allow a decentralized market to determine the velocity and direction of society's wealth. That "provincial secretary" declaring private enterprise to be a social evil because the entrepreneurs and risk takers keep the profits, rather than spread the wealth around, expresses a universally accepted belief among university-educated western elites.

When the Left declares capitalism to be an evil, they bring up unemployment and income inequality. But, when the Left is able to set up their ideal social arrangements, you end up with a system where even the lowliest retailer of gew-gaws and knick knacks is an enemy of the state, and where the state is the sole dispensor of the necessities of life until it is unable to do so. And where citizens are banned from entering their own capital city.

Despite this, it is the Left that, even now, has all of the sentiment and songs on its side. We can only hope there are enough people out there who understand what lies beneath the Left's promises of Equality and Justice, because the Left is certainly ascendant now, and determined to put its imprint on us as quickly as possible.