David Letterman once made a great joke about North Korea: Its dictator Kim Jong Il, he said, is about to step down from power--and be replaced by Menta Li iIl.
Is there a more backward country than North Korea? Every year, it finishes dead last in the Index of Economic Freedom--even the repressive governments of Cuba, Iran, and Zimbabwe are judged to be more market friendly than the central planners of Pyongyang.
That’s why I’m encouraged to learn about the Kaesong industrial complex, a North and South Korea joint venture located just north of the DMZ that divides the Korean peninsula. Unfortunately, protectionists see it not as a hopeful development but as a way to drive a wedge between South Korea and the United States.
As the Wall Street Journal reported earlier this week, Kaesong combines South Korean capital with North Korean labor to produce about $300 million in consumer products, which account for about a third of the $1 billion that the two Koreas trade annually.
This is chump change for South Korea, which currently enjoys a GDP of nearly half a trillion dollars. But trade between these sister nations could explode: About 7,000 North Koreans work at Kaesong right now, and their numbers may grow to more than 750,000 within six years. As Sen. Everett Dirksen once said, a billion here and a billion there and pretty soon you’re talking real money.
When it comes to North Korea, there’s no point in mincing words: President Bush had good reason to include Kim Jong Il and his henchmen in the “axis of evil.” Their ruthless devotion to the intellectually bankrupt principles of communism has impoverished North Korea’s hungry people, their refusal to permit even the most basic freedoms has crushed too many spirits, and their determination to produce weapons of mass destruction has made them a threat to global security.
Yet the Kaesong project is worth supporting if only for its simple humanitarianism: North Korea can’t feed its own citizens without massive international assistance. Doesn’t it make sense to create a situation in which some of them work for wages rather than wait for handouts?
What’s more, Kaesong may give North Koreans a small taste of freedom. The joint venture reminds me of the maquiladora factories that rose just south of the Rio Grande in the 1980’s and 90’s. They’ve had a positive economic effect on workers as well as the political environment in Mexico: Felipe Calderon, the pro-growth candidate, won the recent presidential election because of his popularity in the northern part of his country.
Granted, North Korea isn’t Mexico, and not only because it doesn’t have elections. Yet Mexico also illustrates an important rule: If you let people trade, they will understand that their prosperity is linked to economic freedom. It may take a while for this message to make its way through the white noise of North Korean propaganda, but it can’t be suppressed forever.
The bottom line is that we should seize Kaesong as an opportunity rather than view it as a problem.
Alas, the enemies of free trade see Kaesong as an excuse to undermine the ongoing free-trade talks between South Korea and the United States. They’re already complaining that North Korea’s record on labor and human rights is so awful, and Pyongyang so deserving of utter isolation, that we shouldn’t reward its Kaesong partner with new trade benefits.
This is a case of cutting off your nose to spite your face: For one thing, this trade pact is not about rewarding South Korea so much as benefiting Americans. South Korea is already our seventh-largest export market. There’s lots of room for improvement; one example is if U.S. rice farmers gained more and better access to the Korean market.
We must also remember that despite the huge differences between democratic South Korea and totalitarian North Korea, the Koreans themselves are one people. Most of them would like to see their two nations united, just as East and West Germany merged at the conclusion of the Cold War. There, the East became more like the West. In Korea, we will want the North to become more like the South. I predict it will.
Kaesong is a small step in the right direction--a glimmer of hope in a place that knows too much darkness.
Dean Kleckner, an Iowa farmer and former President of the American Farm Bureau, chairs Truth About Trade and Technology (www.truthabouttrade.org). Mr. Kleckner was the only farmer to serve on the U.S. Advisory team during the GATT Uruguay Round.
Recieve the latest news and commentary from Truth About Trade & Technology in your inbox every Friday with our newsletter subscription service.
Subscribing is easy and free, simply fill out th form below and you subscription will begin immediately. We protect your privacy, your e-mail address will never be sold or redistributed and you can unsubscribe at any time.
News 
David Letterman once made a great joke about North Korea: Its dictator Kim Jong Il, he said, is about to step down from power--and be replaced by Menta Li iIl.
