Intelligence Failures for North Korea: How Serious?

By Danny Lam

North Korea’s successful test of solid fueled missiles highlight how allied intelligence missed signals that DPRK made an abrupt and major leap in missile technology.

Experts like John Schilling that initially estimated DPRK requires 5 years from first launch to IOC for their solid fueled missiles revised their estimate to less than a year.

But there is more to the puzzle.

Behind this event is an intelligence failure of major proportions beginning with analysis of DPRK’s economy.  

DPRK is also rapidly modernizing their conventional armaments, with their “byungjin” (simultaneous push) strategy of economic growth and across the board (conventional and nuclear) military capabilities.

DPRK is certainly not reducing conventional capabilities as they develop a credible nuclear arsenal.   If anything, they are rapidly enhancing them.

The sheer scale and speed of advance of the WMD/nuclear programs is breathtaking.

But when coupled with what is known about their ramp of conventional military capabilities, it suggest an intelligence failure (or should we say “oversight”) of monumental proportions by allied intelligence agencies.

Time and time again, Kim Jong Un’s DPRK has been underestimated: Especially DPRK’s economy under Kim Jong Un.

The dominant American paradigm presume that DPRK is on the verge of collapse.   A majority of analysts still presume that Beijing China have the capacity to “shut down” DPRK by enacting airtight sanctions (e.g. “take oil as the key link”), that the only reason they have not done so is the fear of waves of refugees from North Korea post collapse or the takeover of DPRK by US ally ROK.

More worrisome, many still take benign views of DPRK’s motives and intentions which require disregard and dismissal of recent, repeated, public statements by Kim Jong Un’s regime published in places like Rodong Sinmun, the official paper of the Central Committee of the Worker’s Party of Korea.

What are the failures?

The intelligence community’s gravest failure is to underestimate the vibrancy of the DPRK economy under Kim Jong Un.   Their image of a DPRK Stalinist system that reeled under the pressure of the collapse of their patron USSR that in turn, lived on handouts and aid from PRC is at best dated to the Kim Jong Il era.

Under Kim Jong Un, North Korea demonstrated that by unleashing the economy to permit a degree of state enterprise based “capitalism” and market forces, a hidebound economy can be revived in very short order.

To anyone who have witnessed this phenomena of “opening” happen in China (post Deng 1978), or how fast market forces took off in Eastern Europe once the grip of Stalinism was relaxed, and least of all, in USSR, this is no surprise.

Wealth exploded, hundreds of millions lifted out of poverty in a matter of years.   Did any IC analyst wonder where all the billionaires with mega yachts from former USSR or philanthropist from PRC came from?

On what basis do they exempt DPRK from these precedents?

Deskbound, or should we say hidebound IC DPRK analysts at GS-13/15 are comfortably reading UN reports of starvation in DPRK that assert (as recently as March, 2017) that 18 out of 25m of the population is in need of food aid.   The logical conjecture is that the Kim regime is starving their people to feed their weapons programs.

Few ask where the statistics and data on starvation in North Korea, so beautifully turned into graphics and charts for these reports, come from.   The Kim regime warned of another famine as recently as 2016. The DPRK, in fact, collect and provide the data used by aid agencies and the UN in determination of “need”.

The “need” for 2013 was estimated by the UN World Food Program at $150 million.   For 2017, it is $129 million of which $37m was received.   Let’s put this in context.

For 2012, the UN reported that Kim Jong Un spent $646 million importing “luxury goods”, and at least $1.3 billion on ballistic missile programs alone.   All indications are that spending on such items have substantially increased since 2012.

A crude estimate of the DPRK’s incremental expenditures on their nuclear arsenal and missile programs, combined with the conventional arms modernization programs would suggest that it is at least in the multiple billion dollar range annually before accounting for “luxury goods” for the regime.

This is over and above any revenues that DPRK received from axis partners like Iran.

Properly estimating the economic strength of an adversary is vital.   During the cold war, the IC failed to estimate the defense burden on the Soviet economy that resulted in the failure to see how close the Soviets are to collapse – vindicating Andrew Marshall’s counter-analysis.

Analysis of DPRK’s economy, however, may have erred on the other side by failing to estimate the efficacy of economic reforms, and the vibrancy of DPRK’s economy.

By doing so, the IC have grossly overestimated the efficacy of sanctions (whether formally imposed by Beijing China or not) and underestimate the ability of the DPRK to circumvent them.

It also goes to the heart of regime legitimacy.

An improving economy strengthens the DPRK regime and expand the scope for the Kim regime to maneuver both domestically and internationally.

The vibrant DPRK economy (regardless of sanctions) under Kim Jong Un is key to understanding what DPRK is capable of doing, why they are doing it, and what they are likely to do.

Future articles will address how the IC may have failed in their analysis of DPRK’s politics, regime motives and intentions, and understanding the technological art of the possible from DPRK’s perspective.

North Korea is the IC’s “highest” priority. If that is so, let’s get it right.

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