North Korea and South Korea: Different Perspectives on Globalization and Its Effects

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North Korea and South Korea Different
Perspectives on Globalization and Its Effects

• Tuesday
• April 19,
• 2016

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Introduction

• Compare the effects of globalization (or lack
  thereof) on two comparable countries
• with similar culture,
• history, and
• definite point of separation.
• Apples and Oranges

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History of Korea

• Korea is a peninsula of mainland Asia
• People are historically and culturally
  independent
• Located between Japan/China traditional rivals
• 20th Century
• Occupied by Japan 1910
• WWII ends 1945- divided

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History Korean War

• Soviets/Americans decide to divide Korea
• North-Soviet
• South-U.S.
• Promise to hold elections
• Soviets name Kim Il Sung to be communist leader
• 1950 N.K. invades S.K.
• United Nations defends S.K.
• Back and Forth War (1950-1953)
• The Forgotten War
• 53,000 deaths in 3 years
• War ends with a Cease Fire (Stalemate)

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Korean War Memorial Washington D.C.
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• 38th parallel, DMZ (Demilitarized Zone)
• Both countries were ruined in the similar manner
  by Korean War.
• Each embraces different ideology
• Totalitarian Communist North Korea
• Authoritarian- Democracy South Korea

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South Koreas Path to Globalization

• Following the Korean War, a decade of political
  turmoil begins Syngman Rhee chosen President
• Aggressive leader wanted to invade North and
  unify Korea
• U.S. would not supply w/weapons
• Rigged elections for vice president cause student
  riots
• Promises more democracy/riots end

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• First President Syngman Rhee ousted
  from office (1960)
• Democracy not initiated
• military coup d'état, Park Chunghee takes over
  (U.S. supports)
• Park Chunghee begins to build South Korea into
  economic power (1960s)
• still not democratic but STABLE.
• tool chaebol

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Chaebol System (Illegal in U.S.- Anti Trust laws)
Wednesday April 20, 2016

• Conglomerate Organization
• large corporation with many unrelated
  subsidiaries
• centrally planned (govt) though privately
  operated
• lack of input from minor shareholders- FASTER
  ACTING
• financial security for all companies involved

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Parks Economic Plans for Chaebols

• Creation of export-oriented industries
• Clothing
• Automobile
• maintenance of anti-union behavior
• Keep wages low
• Keep prices low
• Protection of domestic market (Tariffs)
• chaebols became major force in the South Korean
  economy

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Top Chaebols in South Korea

• Hyundai
• Automobiles
• Engineering, construction, shipbuilding and
  industrial activity
• Finances
• Samsung
• Electronics
• Petrochemicals
• Construction (Petronas Towers in Malaysia
  Entrapment)
• LG
• Home appliances and electronics
• Petrochemicals and chemicals

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Emerging Globalization (Advantages) (2nd Period)

• Through the chaebols, South Korea emerged as an
  export leader of the world
• Import raw materials to manufacture exports
• Industrialization and Service Economy
• Higher standard of living
• better education
• more material possessions
• increased leisure time
• GDP skyrockets from third world equivalent to
  Western European standards

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Emerging Globalization (Disadvantages)

• Profits appease populace as long as they are
  positive
• economic downturn leads to civil disobedience and
  revolution
• no democratic process or structure to deal with
  problems
• political stability dependent on economic
  situation
• Authoritarian until 1987, numerous revolutions
• Today more democratic

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Decline of Chaebols

• Ultimate decline of chaebols
• Too big to manage effectively
• unrelated industries different needs
• rise in labor cost
• competition from other Asian countries (China)
• cheaper workforce
• Result
• contributed to South Koreas economic crisis
  (1997)

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Globalization Financial Crisis(similar to U.S.
2008 Big Short)

• Convergence of misfortunate economic events 1997
• banking sector was burdened with non-performing
  loans
• excess debt
• lower credit rating
• chaebol oversight and accountability low
• Democracy swiftly corrected recession
• 1998 GDP -6.6
• 1999 GDP 10.8
• 2000 GDP 9.2
• allowed for greater input of populace
• (GDP Gross Domestic Production
• All goods a country produces

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South Korea Conclusion

• Globalization Impact
• Increase wages-raise standard of living
• Demands for social reforms (democracy)
• South Korea became less competitive
• Economically
• (Adjusting to new competitors)
• Future???? UP or DOWN?????

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History North KoreaThursday/Friday April 2122

• After WWII Kim Il Sung controls
• Nationalization of economy
• peoples property Collective farming
• Nationalized industries
• Low standard of living
• Juche (self-reliance)
• closed all capital flow-no outside investments
• "the hermit kingdom

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• Military emphasis
• To secure power Kim Il Sung diverted a third
  economy for military instead of economic reform
  (South Korea, 3)
• 22 million population, 1.2 million military
• wastes the most able-bodied men of society with
  unproductive job
• Famines every year, starving people

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North Korean Dictators

• "Great Leader" Kim Il-sung,
• Grandfather
• First premier 1948-1994
• Born 1912 died 1994
• "Dear Leader" Kim Jong-il
• Father
• Second premier 1994-2011
• Born 1942 died 2011
• The Great Successor Kim Jong-un
• Premier since 2011
• Born 1983

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Memorial for The Great Leader The Dear
Leader
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U.S./North Korean Relations
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Economy of North Korea

• Best example of command economy in the world
• Govt makes all economic decisions
• Govt owns all factories and industries
• Govt controls agriculture (collective farms)

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North Korea Economics

• Refusal to join global markets lower standard
  of living
• police state complete lack of democratic
  institutions
• army needed for governments lacking legitimacy
  massive famines
• PROPAGANDA
• Notable exceptions to global markets
• Drugs (Opium)
• Arms Trade-
• Nuclear to terrorists?
• Significant portion of GDP
• used for making the military bigger, not food

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North Korea Economics

• Major industries
• machine building,
• electric power,
• chemicals,
• mining,
• metallurgy,
• Textiles
• military products,

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Economy North Korea's GDP growth has been slow
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• State provides free
• Housing
• Healthcare
• Education
• High quality esp. math/sciences
• Political ideology Brainwashing
• .

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Military

• Defending the fatherland is the supreme duty and
  honor of citizens
• Male universal conscription (all must serve in
  military)
• Female partial conscription
• Young Red Guard youth training

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Military

• N.Korea secretive about military
• Est. 700,000 to 1.2 million 4th largest
• GlobalFirepower.com ranks 25th in world

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Monday April 25, 2016
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Nuclear Weapons

• Four successful nuclear tests 2006,2009, 2013
  2016 (NK claims hydrogen)
• U.N. sanctions have been used to deter
• Six Party Talks (US, RUSSIA CHINA, JAPAN, S.K,
  N.K.)
• Poor results
• 2016 China condemns nuclear test. HOPE???

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Nuclear Weapons

• Delivery system (rockets/missiles)
• Short range YES
• Mid range ???
• Long Range NO

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North Korea Police State

• Two criminal systems
• Social crimes (traditional)
• Political crimes (against the communist party)
• Secret police
• Special courts
• Secret Prisons
• GULAG

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• Dozens of camps
• 100s of thousands
• Hard labor
• Families (men, women, and children)
• Foreigners

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Continuing Crisis w/S. Korea

• On November 23, 2010, North Korea fired about 170
  rounds of artillery on Yeonpyeong Island
• The attack resulted in the 19 casualties of
• civilian and military
• North Korea claims provocation by S. Korea

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N S Korea Conclusion

• North Korea is
• opposed to globalization (hermit kingdom).
• Very low standard of living
• Very powerful military
• Every aspect of life controlled by a single group
  (communists)
• Political
• Social
• Economic

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N S Korea Conclusion

• While South Korea experienced problems
• is now on a democratic path
• with an economy that is substantially better in
  every aspect.
• Member of the global community. U.S. ally.

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N S Korea Conclusion

• N. Koreas military and nuclear capabilities
  create a dangerous situation especially with a
  very young untested leader
• Future is unpredictable .