Wednesday, April 4, 2012

Economic Sanctions Against NK: Do we need more of it?

Economic sanctions are imposed against North Korea for four primary reasons:  
(1) North Korea is seen as posing a threat to the security of East Asia
(2) North Korea is a state sponsor or supporter of international terrorism
(3) North Korea is a Marxist-Leninist state, with a Communist government
(4) North  Korea has been found by the United State Department to have engaged in proliferation of weapons of mass destruction. 

Moreover, the United States has also taken steps to isolate the Macau-based Banco Delta Asia for counterfeiting and money-laundering activities, actions North Korea has characterized as attacks against it. 

In accordance with U.S. law, the United States limits some trade, denies trade in dual-use goods and services, limits foreign aid, and opposes entry into or support from international financial institutions. 

Here' s one thing I learnt about NK in Game Theory class. Game theory can be applied to  study actions (both political or economic) between 'rational' countries. However, rationality does not exist in NK, so it is very tough to study NK's actions. Not only do we have a very imperfect information about NK, making it a very complex Bayesian game, NK is simply very irrational.
So what do we do with irrational parties? Simply do not negotiate with them.
Negotiations with them is impossible. The only answer to irrationality would be economic/physical/political sanctions and threats.

The day of NK rocket launch  is nearing. Kim Jong Un claims that the 'satellite' will be launched next week, around April 12-14.
Although the international society have been pressuring  the NK regime into aborting the launch, I believe the sanctions on NK was insufficient to thwart their efforts.

What we need is stronger sanctions. Although it is very unfortunate that the North Korean people are starving, persuading them to abandon nuclear weapons for food is definitely not the answer to the problem. Although the food may ease the starvation problem for a temporary period, it will extend and justify the dictatorship in NK for a longer time, which will in turn backfire at the NK people for a extended period of cruelty from the totalitarian government.

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