Summary:

North Korea has sort of announced that they are about to test a new
missile in August, a missile able to reach parts of Alaska.  The
U.S. has a carrier battle group in Pusan, South Korea.  The
Japanese are pleading with the Chinese, the Mongolians and anyone
else who will listen to get the North Koreans to stop the test.  A
report is being prepared by a former U.S. Secretary of Defense on
the whole North Korean problem.  For a country that was supposed to
starve to death during each of the past five winters, the North
Koreans have done remarkably well in making themselves the focus of
major powers.  That achievement was not accidental.  It was part of
a skillful strategy we call the "Crazy Fearsome Cripple Gambit."
In its own way, it is a work of art.

Analysis:

The North Korean government confirmed this weekend that it was
preparing to test a new missile in late August.  The confirmation
came after South Korean intelligence sources were quoted by South
Korean media as saying that preparations were underway for a new
launch at North Korea's Musudan-Ri launch facility in the
northeast.  South Korean media reported that the height of the
launch pad had been increased from 20 meters to about 60, leading
to speculation that the new missile to be tested was substantially
larger than the one launched last August, and therefore had a much
longer range, perhaps as much as 3,750 miles - long enough to reach
parts of Alaska. Agence France Presse reported that North Korea had
leased a Thai communications satellite with Global Position System
(GPS) that would be used to track the missile test.  With evidence
mounting that the test was likely, North Korea condemned efforts by
Japan, South Korea and the U.S. to block the launch, which most
observers felt confirmed an upcoming test.

Amidst this speculation, the U.S. aircraft carrier Constellation
and its battle group arrived in the Korean port of Pusan for a
five-day port call. The carrier, scheduled to be deployed in the
Gulf, could be held near Korea if tension intensified.  At the same
time, Japanese Prime Minister Obuchi, on a previously scheduled
trip to China and Mongolia, made the impending launch a prime topic
of conversation, seeking both Chinese and Mongolian help in
persuading North Korea not to test the missile.  In addition, Japan
has made it clear that it would not be able to provide North Korea
with cash, departing from a U.S.-negotiated program designed to
supply energy to North Korea in exchange for North Korea not
developing nuclear weapons.  This departure would create a crisis
between Japan and the U.S., which regards North Korea's nuclear
weapons program as a separate and greater threat, and does not want
the missile problem undermining control of the nuclear problem.
Topping it all off, India has seized a North Korean ship that it
says was smuggling missile parts to Pakistan.

So, North Korea has done what it does best: getting everyone tied
up in nervous knots.  In point of fact, all that has happened is
that South Korea has claimed to have detected the construction of a
large, new test facility, while the North has simply defended its
right to launch any missile it wants.  This was enough to create an
uproar involving all the regional powers and the U.S. as well.
Whether the missile is ever launched, crashes or works, North Korea
has succeeded in creating precisely the environment it thinks it
needs in order to survive.  The missile is in a way much less
interesting than the use to which North Korea puts the very rumor
of its existence.

North Korea has one consistent goal: to survive as an independent
country under the control of the present regime.  For North Korea,
this has not been an easy goal to achieve, and it became
increasingly difficult and even seemingly impossible following the
collapse of the Soviet Union. The foundation of North Korea's
security was the fact that its survival was in the strategic
interest of both the Soviet Union and China.  This kept at least
some resources flowing in and guaranteed the physical security of
the country.  Even after the Sino-Soviet split, North Korea's
security was assured.  Indeed, it was in many ways in a better
position than before.  It could play the Soviets off against the
Chinese to increase their support, without being forced to develop
openings to the West.

The triumph of Deng's line in China was the first challenge to
North Korea.  As China opened to the West and focused on economic
development, whatever strategic benefit North Korea might have
provided evaporated into irrelevance. Investment in Shanghai was
infinitely more important than the status of North Korea.
Glasnost and the collapse of the Soviet Union further pushed North
Korea into strategic irrelevance. By 1993, North Korea was on its
own for the first time since its founding, without a patron
prepared to underwrite the survival of its regime.  With Soviet
communism gone and Chinese communism appearing to deteriorate into
little more than an irrelevant piety, insulation against the
fabulously successful South seemed impossible to maintain. North
Korea was expected to collapse, and scenarios for dealing with
this prospect were developed by all concerned.  South Korea drew
up detailed plans for the administration of North Korea, worrying
about such issues as whether or not they should pay the North's
debt.

North Korea's regime was not, however, prepared to go gently into
that good night.  They devised a strategy that we call the "Crazy
Fearsome Cripple Gambit."  North Korea understood its
vulnerabilities very clearly.  It also understood the fears of
others.  South Korea, with its capital and industrial heartland
only a few miles from the DMZ, was interested in reunification, but
much more motivated to avoid any conflict that would endanger its
economic infrastructure.  The U.S. was equally eager to avoid a
situation in which its forces in Korea were engaged in
high-intensity conflict.  China and Russia did not want relations
with the West disrupted.  North Korea was also aware that it had a
reputation for military formidability and unpredictability,
although it had pursued an extremely cautious and rational foreign
policy since 1953.  It had few assets to play with, but two were of
the essence.  First, no one really, deeply cared what happened in
North Korea.  Second, no one wanted a war with North Korea.

By 1994 North Korea had perfected a brilliant three-part strategy.
The first part was to portray itself as a cripple.  Since 1994, we
have been hearing of massive food shortages that would likely wipe
out huge swaths of North Korea's population.  Every summer, reports
begin to circulate about the likelihood of massive deaths in the
coming winter.  Now, there is little doubt that life in North Korea
is miserable, that malnutrition is rampant, and that deaths from
starvation have occurred.  But if the reports that have circulated
since 1994 were all true, everyone in North Korea should be dead by
now.  Most are not.  What North Korea did was to take a real
problem - its food situation - and make it appear to be so
devastating that it might destroy not only the regime, but the
whole country.

That would seem a strange thing to do, but was in fact extremely
rational, as part of the Crazy Fearsome Cripple Gambit.  During the
early 1990s, there was discussion of what actions might be taken to
hasten the fall of the Pyongyang government.  South Korea and the
U.S. both had tools available that could have caused serious
problems for the regime.  By projecting a massive, insoluble food
crisis, the North Korean government made it appear that outside
actions were completely unnecessary.  With a food crisis on the
order of Ethiopia's, the regime was likely to collapse on its own.
There was no reason to undertake risky strategies to hasten its
fall.  The expectation of collapse, in an interesting way, tied the
hands of its enemies.  As an added bonus, the perception of
impending starvation actually motivated the international community
to ship food to North Korea, alleviating what shortage there was.

Having established itself as a cripple, unworthy of outside
manipulation, the next step was to make itself fearsome.  The North
did everything it could to make the West aware that it was
developing nuclear weapons and delivery systems.  It conducted
maneuvers of conventional forces that made it appear that their
soldiers were massing along the DMZ ready for a strike.  It carried
out espionage missions that set alarms ringing in Washington, Tokyo
and Seoul.  The North did everything in its power to appear as
fearsome as possible.  When it recently prevented inspections of
its nuclear facilities, it may have been stopping Western
inspectors from finding out how far it had gotten. Alternatively,
it may have stopped the U.S. from finding out they had not gotten
nearly as far as anyone thought.  We don't know.  However, by
preventing inspections, North Korea allowed everyone's imagination
to run wild. Whenever things quieted down, they could count on
South Korean intelligence to float another story about North
Korea's new and extraordinary achievements in weapons development.
The stories may well have been true; North Korea certainly devoted
a huge amount of its resources to developing weapons.  But the
actual construction of weapons was less important than was
convincing everyone that they were constructing weapons.  North
Korea may well have major nuclear capabilities and delivery
systems, but that is less important than making sure the outside
world believes that it has those systems.

Having established that they were crippled and fearsome, the
critical element was to establish their insanity.  The appearance
of being crippled helped enormously.  Since the regime was in
imminent danger of falling, since the government would do anything
to stay in power, and since the government had all sorts of
military options available to them, it followed that the threat of
collapse might trigger some crazed military adventure.  Because no
one wanted that, it followed that not only would no one try to
collapse the North Korean regime, but that they would take steps to
stabilize it.  The fear that desperation would make North Korea
take extreme measures, coupled with a deep-seated belief that the
North Korean government in general was hearing voices that no one
else could hear, generated a general feeling that North Korea was
like nitroglycerine.  It was likely to go off at a single, careless
touch.  That view suited North Korea's needs perfectly.  The Crazy
Fearsome Cripple was born - a serious actor on the global stage.

The North Koreans have created a situation in which every move they
make is watched, reacted to and feared.  No one discusses the
collapse of North Korea any longer.  Rather, everyone discusses
what steps can be taken to stop the North Koreans from developing
nuclear weapons, from developing long-range missiles, from suddenly
and unpredictably invading the South.  These are not things they
are actually likely to do.  The North Korean army, for example, is
essential to internal security.  True, Seoul's industrial treasures
are within striking distance of the DMZ.  But that would mean a
miserable urban battle in which the defenders have a decided
advantage.  North Korea is not about to throw away the foundation
of its regime in house-to-house fighting in Seoul.  Similarly,
North Korea is not about to nuke Anchorage.  Much of North Korea
would disappear shortly thereafter into a radioactive cloud.  This
would definitely disrupt the regime.  Most of the threats that
North Korea poses are credible only if we assume that they are
nuts.  Of course, nothing in their foreign policy indicates
anything but strict self-control.  Strange press releases aside,
the North Koreans have been quite restrained since 1953.

For North Korea, doing something is much less effective than
appearing to be capable of doing something or appearing to be about
to do something.  For over five years, North Korea has conducted a
holding action, designed to preserve their independence and their
regime by appearing to be a Crazy Fearsome Cripple better left
alone.  The goal was to survive until the geopolitical climate
shifted and it could, once again, find a patron to whom it could be
useful.

It appears to us that North Korea is indeed becoming useful to
China once again.  At a summit meeting in China between China's
and Japan's prime ministers, Japan's prime minister came asking
for a favor: Chinese pressure on North Korea to cancel its missile
test. It came bearing gifts.  Japan became the first G-7 nation to
negotiate a bilateral agreement with China on World Trade
Organization membership.  It achieved this agreement by conceding
to China a main point concerning participation in China's
potentially enormous telecommunications industry.  However, China
made it clear that this wasn't enough.  It wanted Japan's
assurances that it would not include Taiwan in its trilateral
relationship with South Korea and the U.S.  This, plus the fact
that Japan takes the missiles much more seriously than does the
U.S., obsessed with North Korea's nuclear capability, promises to
kick off a very satisfactory row between Tokyo and Washington -
precisely what Beijing and Pyongyang want to see.

Now, it really isn't clear how much influence China has in North
Korea.  That isn't nearly as important as the fact that the
Japanese think China has influence.  It is a marvelous reason for
the Chinese to work to develop some influence, since they can
obviously trade that influence for major Japanese economic and
political concessions.  If Japan and the U.S. are worried about
North Korea, China can trade on that concern.  That means that
North Korea will be of value to China and can extract concessions
and support from Beijing, which in turn means that Beijing will not
want North Korea to collapse and will work to stabilize the regime.
And that will mean that the Crazy Fearsome Cripple, simultaneously
too weak to worry about and too dangerous to anger, will have
pulled off what appeared impossible a few years ago: it will have
survived.