Last May at Mauldin Economics’ Strategic Investment Conference, I predicted that the crisis in North Korea would likely lead to war. The crisis ensued, but war has not broken out.
With a top US official saying the Pentagon might have to handle this crisis, it’s time to review what has happened and whether war is really an option now.
(I’ll be addressing this very topic at our upcoming New York conference—you can learn more here.)
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North Korea Passed a Threshold in Its Nuclear Program
North Korea had been developing nuclear weapons for years. This was nothing new. But the development that turned this into a crisis was that the North had passed a threshold.
North Korea had reportedly developed warheads small enough to be fitted to a missile. Pyongyang also seemed to be moving toward a new missile that would be capable of striking the US.
One of the United States’ top imperatives is to keep the homeland secure from foreign attacks of all sorts. The prospect of a nuclear attack towered over all other threats. The problem, of course, was figuring out how close North Korea was to developing an operational weapon.
The United States was, therefore, in an area of uncertainty.
Why the United States Stalled
The US had little to gain from a war with North Korea; it wanted only to destroy the North’s nuclear program. The war plan was complex. And though it was likely to succeed, “likely” is not a term you want to use in war.
North Korea’s nuclear and missile facilities were scattered in numerous locations, and many were underground or in hardened sites. And the North Koreans had massed artillery along their southwestern border, within easy range of Seoul.
In the event of an American attack on North Korean facilities, it was assumed those guns would open up, killing many South Koreans. Destroying those batteries would require a significant air campaign, and in the meantime, North Korean artillery would be firing at the South.
The US turned to China to negotiate a solution. The Chinese failed. In my view, the Chinese would not be terribly upset to see the US dragged into a war that would weaken Washington if it lost and would cause massive casualties on all sides if it won. Leaving that question aside, the North Koreans felt they had to have nuclear weapons to deter American steps to destabilize Pyongyang. But the risk of an American attack, however difficult, had to have made them very nervous—even if they were going to go for broke in developing a nuclear capability.
But they didn’t seem very nervous. They seemed to be acting as if they had no fear of a war breaking out. It wasn’t just the many photos of Kim Jong-un smiling that gave this impression.
It was that the North Koreans moved forward with their program regardless of American and possible Chinese pressure. A couple of weeks ago, the reason for their confidence became evident.
The US and South Korea at Odds
US President Donald Trump tweeted a message to the South Koreans accusing them of appeasement.
In response, the South Koreans released a statement saying South Korea’s top interest was to ensure that it would never experience the devastation it endured during the Korean War.
From South Korea’s perspective, artillery fire exchanges that might hit Seoul had to be avoided. Given the choice between a major war to end the North’s nuclear program and accepting a North Korea armed with nuclear weapons, South Korea would choose the latter.
With that policy made public, and Trump’s criticism of it on the table, the entire game changed its form.
The situation had been viewed as a two-player game, with North Korea rushing to build a deterrent and the US looking for the right moment to attack. But it was actually a three-player game in which South Korea played a pivotal role.
The US could have attacked the North without South Korea’s agreement, but it would have been vastly more difficult. The US has a large number of fighter jets and about 40,000 troops based in the South.
South Korean airspace would be needed as well. If Seoul refused to cooperate, the US would be facing two hostile powers and would possibly push the North and the South together.
Washington would be blamed for the inevitable casualties in Seoul. The risk of failure would pyramid.
With the South making it clear that it couldn’t accept another devastating war on the peninsula, the war option was dissolving for the United States. In this light, North Korea’s confidence is fairly legitimate.
For the United States, a nuclear North Korea is still anathema, but war is less of an option.
One solution would be to increase the isolation of the North, but there is little that can be done to isolate Pyongyang more than it already is. Another solution would be to convince China to bring overwhelming pressure on North Korea.
But in exchange for their cooperation, the Chinese will demand massive concessions. Some will be about trade, others about the South China Sea and US forces in South Korea.
Trump will be traveling to China, likely in November, to continue negotiations. In the meantime, South Korea remains opposed to war on the peninsula, and that explains why the US is going after South Korea on steel.
We got the crisis I predicted, but the war that seemed so likely has become an enormously more complex issue… though still a possibility. If North Korea appears too immediately threatening, if China is unwilling or incapable of persuading the North, or if the United States simply decides that it cannot tolerate the risk posed by North Korea, then war is possible.
But the geometry of that war will be very different than it first appeared.
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