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U.S. Navy Secretary meets with Korean Minister of Defense in U.S. Navy (Kevin S. O’Brien)

A Focus on Costs, Not Benefits, Dampens ’ Desire for Reunification

By Gregory Macris

hile reunification remains Young people think the financial sacrifice will be huge. That’s South Koreans’ preferred 1 why they may have negative emotions toward unification. method of ending the — of President W peninsula’s long division, Korean youth increasingly are contemplating Myung-bak, 2011 alternatives such as permanent separation. Many consider another foreign country, albeit one whose inhabitants share language and ancestry. Numerous factors underpin their changing attitude. Sixty years have passed since the sealed the frontier, reducing familial ties and other linkages with the North. Rapid increases in wealth, plus advances in communications and Gregory Macris wrote this essay while a student at the National War College. It won the Strategy Article transportation, have brought ’s category of the 2012 Chairman of the Joint Chiefs of Staff Strategic Essay Competition. mindset closer to the West. The strongest

ndupress.ndu.edu issue 67, 4 th quarter 2012 / JFQ 49 essay winners | Koreans’ Desire for Reunification

to South Korea’s infrastructure, the North’s utility and transportation grids appear medieval. While the ROK rates among the most wired nations in the , Internet con- nectivity is rare in North Korea. Much agri- cultural land lies fallow and environmental degradation is frightening in scope. Also wor- risome is the North’s woeful underinvestment in . Although basic literacy surpasses that of most developing countries, the -heavy student curriculum has a feel, and even engineers have limited computer proficiency. Furthermore, the mid- and continuing malnutrition have stunted cognitive and physical growth of Erected in 2001, the Arch of Reunification in an entire of North Koreans. , North Korea, features two women in South Koreans who fear union for finan- traditional garments reaching out to one another and holding up a map of a unified Korea cial reasons look worryingly at , where reunification expenditures between 1989 and 2010 surpassed $2 trillion. West catalyst of anti-unification sentiment among Curtailing financial support could hasten Germany faced a comparatively simple Republic of Korea (ROK) youth, however, is regime change and thereby increase reunifica- assimilation next to South Korea, which the monetary cost of unification, which could tion prospects. Nonetheless, prominent Korea must incorporate a far larger, poorer, and surpass $2 trillion. Overcoming anxieties that watchers contend that Seoul prefers that the less-educated . Moreover, while a equate with impoverishment North undergo a -like economic reform physical barrier separated Germany for nearly will require ROK decisionmakers to portray before unification proceeds.5 30 years, it was hardly impassable. Significant costs as investments and to highlight reunifi- Electoral calculations explain the East-West occurred even after the Berlin cation’s economic benefits, which will endure go-slow approach, as ROK citizens jealously Wall was constructed. The in long after expenditures subside. Since a reuni- guard their hard-won prosperity and punish Bonn and Berlin maintained phone, mail, fied Korea furthers long-term U.S. interests politicians who risk it. Recently publicized and transportation links, and had inked 30 in Northeast , the should cost estimates on reunification have stoked treaties to minimize practical repercussions of support the ROK effort. fears of a return to poverty. The Presidential the political division.9 In sum, East German Council for Future and Vision set the price dependence on the West arising well before Once Solid, Support Begins to Dwindle tag for union at $2.1 trillion if the North 1989 created conditions that smoothed uni- ROK politicians continue to promote Korean regime toppled today.6 That figure fication. Linkages between North and South peninsular union, fearing electoral blowback represents $40,000 per ROK citizen and Korea pale by comparison. if they abandoned this longtime strategic would raise the national debt from a man- Yet a closer look at the German objective. Nevertheless, recent polling shows ageable 38 percent of example offers lessons and cost savings for support for integration dropping. Eighty (GDP) to 135 percent. South Korea. Germany’s introduction of a percent of mid- South Koreans asserted common currency upon reunification proved unification was imperative. That figure now What Is Behind These costly because the East’s ostmark had a pre- reads 56 percent.2 Young poll at 41 Enormous Figures? unification value just one-fourth that of the percent, while only 20 percent of ROK teenag- South Korea’s 49 million residents enjoy deutsche mark. Similarly expensive was the ers consider national union vital. Of citizens a per capita GDP of approximately $30,000. common wage scale for Easterners, whose claiming that achieving reunification should Corresponding figures for the North are pre-1989 productivity rated just 25 percent of be the ’s highest objective, 83 unreliable, but demographers estimate the their Western cousins.10 Unfettered migration percent were elderly. Most South Koreans population at 24 million and GDP at $1,000 to rights and migrants’ immediate qualification under 30 assert the government should focus $2,000. The South’s assimilation of a popula- for social welfare raised expenditures further. first on improving their job prospects.3 tion half its size and far poorer would require With each measure, the German government Despite loud pro-reunification rhetoric, a gargantuan investment. Korea experts sought to solidify political union by leveling ROK government policies often preserve peg first-year expenditures—primarily for incomes regionally. the peninsular status quo. Examples include humanitarian assistance and resettlement—at Nevertheless, examples abound of large-scale food and fertilizer donations to $50 billion.7 Costs could rise further if the politically stable nations whose regions differ North Korea and continued funding of the nations reunified following a violent struggle, widely in wealth. China’s has little Kaesong Industrial Complex north of the as in .8 enhanced its central and western provinces, , which conservatively pro- Infrastructure expenditures increase while in , Sicilian incomes are barely one- vides $20 million yearly to the family.4 reunification’s cost considerably. Compared third of those in Milan. Even in the United

50 JFQ / issue 67, 4 th quarter 2012 ndupress.ndu.edu MACRIS

States, per capita GDP in the South trails the on under-30 public opinion. Many youth are the labor force, with predictably negative eco- North, 147 years after the . Any unaware a political agreement would bring nomic consequences. attempt by a unified Korea to quickly harmo- both short- and long-term economic stimu- Its only land frontier sealed, South nize Northern and Southern incomes would lus. First to benefit would be South Korean Korea resembles an island economy plagued drain government coffers and ultimately fail. firms, owing to aforementioned by high transportation costs. Erasing the A RAND Corporation study proposes infrastructure requirements in North Korea. fortified border would allow land shipment of a more modest effort. Rather than pegging Longer term, the North’s greater fecundity goods to and from China and . Energy North Koreans’ income as a percentage of would help alleviate what is perhaps South costs would fall, as an envisioned pipeline Southerners’ income, RAND’s model aims Korea’s greatest strategic challenge: a birth from to Seoul would reduce only to triple existing Northern GDP. The rate in 2010 that ranked as the world’s lowest seaborne shipments of expensive liquefied resulting reunification cost estimates range (1.14 children per woman).12 natural gas.14 Reunification also would lower widely because of one variable difficult to fix: Significant savings would accrue capital costs since government and private the current size of the North Korean economy. from reduced military spending, redirect- industry currently pay higher interest rates Nonetheless, RAND predicts a more manage- ing capital to more productive parts of the because of political uncertainty. able price tag of $50 to $667 billion; private Korean economy. Experts calculate a unified funding from South Koreans’ savings and the Korea would require 500,000 men in uniform Costs a Factor, Not a Non-Starter global capital market could cover half, with (corresponding figures for North and South Recent developments on the Korean governments and international financial insti- Korea today are 1.1 million and 680,000, peninsula, from North Korea’s 2010 sinking tutions providing the remainder.11 respectively.)13 Owing to the low wages paid of the to its continuing nuclear and in the North and the expectation its soldiers ballistic missile activities in contravention Increased Economic Activity: would comprise a large percentage of the of international sanctions, seemingly make The Other Side of the Ledger unified military, shrinking the ROK army discussion of reunification an academic exer- The financial benefits of peninsular would provide a significant “ dividend.” cise at best. Yet might an “outlier” be lurking? reunification receive short shrift in South Further, universal ROK delays In 1989, few analysts were predicting the fall Korean media, with expected negative results young males’ entry into higher education and of the Berlin Wall or collapse of the Soviet

South Korean participate in urban operations training at Korea Training Center where U.S. Marines take part in Korea Interoperability Training U.S. Marine Corps (John Kennicutt)

ndupress.ndu.edu issue 67, 4 th quarter 2012 / JFQ 51 essay winners | Koreans’ Desire for Reunification

NEW from NDU Press for the Center for Strategic Research Institute for National Strategic Studies

Strategic Perspectives, No. 12 James J. Przystup’s Chairman of South Korean Joint Chiefs -China Rela- Strategic PerSPectiveS 12 Japan-China Relations 2005–2010: of Staff talks with tions 2005–2010: Managing Between a Rock and a Hard Place An Interpretative Essay by James J. Przystup commanding officer Managing Between of USS Chafee during a Rock and a Hard exercise 2012

Place, An Interpreta- U.S. Navy (Melissa Pelosi) tive Essay, examines 2 Ibid. the metafactors Union. It thus behooves the South Korean 3 Christine Kim, “Paying for Unification: Only Center for Strategic Research shaping the China- Institute for National Strategic Studies government (and its strongest ally, the United National Defense University 10.8% Want Taxes,” Joinsmsn.com, 3, 2011. Japan relationship: States) to plan prudently for reunification, 4 Dick Nanto and Mark Manyin, The Kaesong the rise of China, irrespective of timing and likelihood. North-South Korea Industrial Complex (Washing- a competition for regional leadership within President Lee Myung-bak has gotten ton, DC: Congressional Research , March 17, a shifting balance of power, and history. At the the message. Even as his electorate is turning 2011), 1. strategic level, there is intense, but quiet politi- rightward, demanding swift retribution for 5 , “Working Through Korean cal competition for the mantle of leadership in Unification Blues,” Asia Times Online, November the Asia-Pacific region. The author discusses any future Cheonan incidents, Lee’s admin- 15, 2007. the increasing integration of the two econo- istration is tacking to center. It is executing 6 “Sudden Reunification Would Total $2.1 mies—for example, within Japan’s business a robust public diplomacy campaign, for Trillion,” Online Edition, Novem- community, the China boom is widely recog- example, whose capstone television pro- ber 4, 2011. nized as the driving force behind Japan’s recov- grams—delivered in sitcom and reality show 7 “ Would Cost $2.38 ery from its “” in the 1990s. Nev- formats favored by South Korean youth—aim Trillion,” Asia Pulse Online, October 7, 2011. ertheless, the Japan-China relationship is also to portray North Koreans in a more favor- 8 Peter M. Beck, “Contemplating Korean Uni- marked by a number of combustible political able light and tout the economic benefits of fication,” , January 4, 2010. issues including conflicting territorial claims, a 15 reunification. Reshaping public opinion is 9 Hanns Gunther Hilpert, “A Comparison disputed maritime boundary in the East China no easy task, however, and will require great of German and Korean Division: Analogies and Sea, and security anxieties in both countries. patience and even greater resourcing. The Differences,” International Journal of Korean Moreover, highly nationalistic, zero-sum issues Reunification Studies, Korea Institute for National relating to , such as the September United States should seek opportunities to Reunification, June 30, 2010. 2010 Senkaku incident, have the potential to echo Lee’s pro-unity message toward Koreans 10 Charles , Jr., “Korean Unification: How derail the relationship at significant cost to both under age 30. It should utilize both high- It Might Come Along, and at What Cost?” Defense nations. These issues must be managed with profile encounters, such as President Barack and Peace Economics 17, no. 6, 681–690. care if Sino-Japanese relations are to reach their Obama’s March 2012 visit for the Seoul 11 Ibid. full potential. , and lesser known 12 Theresa Kim Hwa-young, “South Korea Has tools like Fulbright Scholarships and grants World’s Lowest Birth Rate,” Asia News IT, February for prominent unification supporters to con- 26, 2010. vince Korean youth that reunification under 13 Asia Pulse Online, October 7, 2011. an open democratic system offers the greatest 14 Jason Struther, “Russia, Two Renew chance for regional stability and economic Talks on Stalled Gas Pipeline,” VOA News Online, growth. JFQ September 20, 2011. 15 Harlan. Notes

1 Visit the NDU Press Web site Chico Harlan, “South Korean Young People for more information on publications Are Wary of Unification,” at ndupress.ndu.edu Online Edition, October 17, 2011.

52 JFQ / issue 67, 4 th quarter 2012 ndupress.ndu.edu