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Engagement theory and target identity : an analysis of North Korean responses to contemporary inter-Korean… Roberts, Liam 2004

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Engagement Theory and Target Identity: An Analysis of  North Korean Responses to Contemporary Inter-Korean Engagement by Liam Roberts BA, Concordia University 2003 A THESIS SUBMITTED IN PARTIAL COMPLETION OF THE REQUIREMENTS FOR THE DEGREE OF MASTER OF ARTS in THE FACULTY OF GRADUATE STUDIES Department of  Political Science We accept this thesis as conforming  to the recognized standard The University of  British Columbia August 2004 © Liam Roberts, 2004 Library  Authorization In presenting this thesis in partial fulfillment  of the requirements for an advanced degree at the University of British Columbia, I agree that the Library shall make it freely available for reference and study. I further  agree that permission for extensive copying of this thesis for scholarly purposes may be granted by the head of my department or by his or her representatives. It is understood that copying or publication of this thesis for financial gain shall not be allowed without my written permission. L i AaA. fi^o  FS Q3 /o<\  /  ^-ofr^ Name of Author (please  print)  Date (dd/mm/yyyy) Title of Thesis: a a j ^ r A ^ ~T/VRL&£-1; U & k R O A •' A y ^ A*,t Al.-^  f^p  o R j & S . p e ^ S . & g , T o C o M T & ^ ^ o [ • r t e e - g ^ T Degree: / A • A- , Year: S h a P ^ Department of P o u i T v e f t v > The University of British Columbia Vancouver, BC Canada grad.ubc.ca/forms/?formlD=THS page 1 of 1 last  updated:  3-Sep-04 This thesis presents an analysis of  engagement theory, as compared and contrasted with deterrence and compellence, as a tool for  minimizing the risk of  conflict  with a dissatisfied  power. Using the particular case study of  inter-Korean engagement since the 2000 North-South Korea Summit, this analysis proceeds with a model of  "active engagement" that attempts the socialization of  new norms in the belligerent target, alleviation of  negative cognitive biases, and reduction in the target's material domain of  losses, while maintaining a strong deterrent against expansionism. This study proceeds from  the perspective of  the dissatisfied  power (the engagement target) in effort  to better understand what motivates either cooperative or uncooperative responses to engagement. Domains of  losses are complex and dependent on what goods (economic, political, ideational) a target values most. This study details the particular goods that North Korean leadership values most highly and analyzes internal preference  formations  that complicate outside efforts  to engage the regime. In studying the South Korean engagement project, this thesis finds  that a combination of  de-politicized economic and cultural engagement streams has had a strong impact on North Korean preference  formation.  Mindful  of  negative cognitive biases that skew target states' perspective of  external "promises," this study also argues that South Korea has managed to advance its engagement agenda by presenting itself  as an internal actor to the divided Korean nation, thus reducing threat perceptions and appealing to North Korean ideational and political priorities. This thesis concludes that a de-linked, state-based, active engagement process must precede institutionalized, regime-based cooperation. This initial phase may nevertheless see cooperation move intermittently. As engagement is a change-oriented strategy, target states will attempt to resist change in certain issue areas while accepting change in others. However, as resistant to change as the target regime may be, engagement forces  targets down a path to engagement that is difficult  to reverse. As both source and target develop interests in engagement, reforming  an adversarial discourse, the prospects for  increased cooperation increase. This is despite the risk that the target may attempt to counterbalance cooperation with belligerence in the short-term. Abstract ii Table of  Contents iii Preface  v Dedication vi Introduction 1 CHAPTER 1 Identifying  and Approaching Dissatisfied  Powers 5 1.1 Engagement, Deterrence, and Compellence 5 1.2 Mixed Strategies: Striking the Case-Specific  Balance 14 1.3 Conclusions 17 CHAPTER 2 Theoretical Considerations for  Engagement Approaches 20 2.1 Engagement and the Status Quo: Maintenance or Modification?  20 2.2 Engagement and Target Objectives: "Limited-Aims" or "Revolutionary"? 23 2.3 Gains-Based vs. Loss-Based Motivations 26 2.4 Comprehensive vs. GRIT Engagement 27 2.5 Overcoming Cognitive Biases 31 2.6 Target Indicators for  Engagement Feasibility 33 2.7 The Korean Engagement Advantage: Inter-State, Intra-National 36 2.8 Conclusions 37 CHAPTER 3 The DPRK as a Target: Implications for  Engagement 39 3.1 Identity: Hegemonic Nationalism or Nationalist Isolationism? 42 3.2 Identity and Implications for  Engagement: Mixed Response 51 3.3 Proclaimed Goals: Sovereignty and Unification  53 3.4 Proclaimed Goals and Implications for  Engagement: Cooperative 55 3.5 Capacity: Revolutionary or Revisionist? 56 3.6 Capacity and Implications for  Engagement: Cooperative 58 3.7 Domain of  Losses: Economic, Humanitarian, Political 59 3.8 Domain of  Losses and Implications for  Engagement: Cooperative 61 3.9 Threat Perception: The DPRK's "Permanent Siege Mentality" 62 3.10 Threat Perception and Implications for  Engagement: Resistant 67 3.11 Conclusions 69 CHAPTER 4 ROK Sunshine Initiatives and DPRK Response to GRIT 72 4.1 Economic Engagement: Nourishing Risk-Aversion, Structuring Incentives 75 4.2 DPRK Reactions to Economic Engagement: Cooperative and Resistant 81_ 4.3 Cultural Engagement: Moderating Negative Cognitive Biases 90 4.4 DPRK Responses to Cultural Engagement: Cooperative and Resistant 96 4.5 Conclusions 104 CHAPTER 5 Final Analysis and Conclusion 107 List of  Figures Figure 1.1: Methods and Objectives in Managing Dissatisfied  States 13 Figure 2.1: Politics in Response to Rising, Dissatisfied  Challengers 23 Figure 3.1: The DPRK as a Limited-Aims Revisionist, Risk-Acceptant State 42 Figure 3.2: DPRK Responses to Inter-Korean Engagement 70 Figure 4.1: Cultural and Social Exchanges, ROK to DPRK (Jan. 2000 to June 2004) 93 Preface My interest in inter-Korean affairs  was first  piqued in a convenience store in northern Seoul during the historic North-South Summit of  2000. I was fortunate  enough to catch glimpses of  the handshake between two powerful  ideological foes,  Kim Dae Jung and Kim Jong II, on a modest black-and-white television set behind the counter. The couple working in the store that night were glued to the image as if  they were watching a supernova. A supernova it wasn't, but the-event did spark many hard new questions in Korea, and for myself,  regarding the nature of  reconciliation, the perception of  threat, and the path towards lasting peace. I extend my heartfelt  gratitude to my professors  and colleaguels here at UBC who have challenged me to take these questions, refine  them, and always push for  more interesting answers. In particular, many thanks to my thesis advisor, Professor  Brian Job, whose dedication, inspiration, and nuanced insight have helped me enormously during this process. Many thanks also to Professor  Paul Evans for  all his enthusiastic support, encouragement, and for  his stimulating questions and advice. My family  has been a great source of  love and patience, and they have undoubtedly been a central part of  anything I was able to achieve this year. Thanks to you all, and I promise that I will be able to talk about something besides this project sometime in the near future. As for  the convenience store owners in my old Korean neighbourhood, I hope that their television will be a small stage for  peace, hope, and progress for  many years to come. Liam Roberts Vancouver 2004 For Mrs. Giles I n t r o d u c t i o n On June 15, 2000, South Korean President Kim Dae Jung and North Korean Chairman Kim Jong II held an unprecedented inter-Korean summit in Pyongyang, designed to herald a new era of  cooperation, engagement, and mutual harmony. Proclaiming a shared goal to move towards establishing the political and economic conditions that would make unification  of  the Korean Peninsula achievable, South Korea (officially  the Republic of  Korea, or ROK) stepped up its "Sunshine Policy" of  engaging the North and bringing the impoverished state into the rubric of  the international community. Yet, since that time, despite the ground that was gained in sustaining Sunshine Policy initiatives, North Korea (officially  the Democratic People's Republic of  Korea, or DPRK) nevertheless pursued a clandestine nuclear weapons programme, has abandoned windows of diplomatic opportunity in the Asia Pacific,  and has frustrated  the international community through a sporadic interpretation of  international law. The nuclear crisis, most especially, has cast shadows on the political utility of  the ROK's Sunshine Policy, and has weakened the position of  engagement supporters. Yet, at the same time as the DPRK has chosen to play nuclear brinkmanship, it has also enabled economic reforms  at home, expanding the capacity for  ordinary North Koreans to engage in lateral social interaction, and indicating the empowerment of  a business-minded type of  technocrat in Pyongyang. Faced with the conflicting  logic of  domestic reformism  and international confrontationalism  in the DPRK, I will analyse North Korean responses to South Korean engagement. How does Pyongyang perceive strategic advantage in light of  South Korean efforts  to engage the regime? I will pursue this analysis according to the following  model: firstly,  I will outline three theoretical strategies that status quo powers may consider when confronted  with dissatisfied  powers: engagement, deterrence, and compellence. Analysing each of  these approaches, I will emphasize that a close study of  the proposed "target state" must include an understanding of  1) whether the state is driven by prospective gains or losses, 2) what the target's perceptible geopolitical ambitions are, and 3) how the target leadership inculcates regime legitimacy domestically. Arguing that neither engagement, deterrence, nor compellence is adequate when used in an isolated fashion,  I will demonstrate the DPRK is well-suited to a mix of  engagement and deterrence, with a bias towards the former. Keeping in mind various cognitive biases that obscure relations between powers, I will argue in the second chapter that engagement is a change-oriented strategy that inspires resistance in the target state. As dissatisfied  states seek change to the status quo according to their own terms, how can engagement alter the status quo in ways that create mutual and interdependent benefits?  I will explore various conceptions of  engagement, from  broad, institutionalized, and comprehensive approaches, to specific,  technical, and flexible  approaches. Which approach yields the best returns is dependent on the various domestic and geopolitical circumstances that drive target-state dissatisfaction,  and these circumstances can be defined  by asking four  key questions: 1) Comparatively, how does the target state value material, political, ideological, and cultural goods? 2) As such, does the target rationalize "promises" and "threats" through a similar process to the source state? 3) What are the goals of  the target state, and what is it willing to risk in advancing these goals? 4) What are the historical experiences that create either positive or negative cognitive biases in the target state, and what does the target expect from  foreign powers and international institutions? Utilizing Randall Schweller's understanding of  dissatisfied  powers, I will detail the key differences  between expansionary, revolutionary dissatisfied  states and limited-aims revisionist states, as well as the differences  between dissatisfied  state strategies when they are faced  with prospective losses (risk-acceptant behaviour) versus prospective gains (risk-averse behaviour). Identifying  the DPRK as a limited-aims revisionist state with high risk acceptance, the third chapter will demonstrate the domestic and geopolitical circumstances that motivate North Korean dissatisfaction:  vulnerability in the security sphere, perpetually hostile relations with other powers, high threat perceptions, a powerful  ideological proclivity towards "total sovereignty," and devastating economic breakdown. These conditions allow us to understand the nature of  inter-Korean engagement efforts,  as Seoul has calculated that a depoliticised, economic and cultural engagement strategy best addresses North Korean concerns without animating sensitive issue areas. This has led to a "de-linked," compartmentalized engagement approach with limited reciprocal conditions, as opposed to a comprehensive, rigorous, institutionalized approach. Engagement has taken the form  of  1) economic channels, to bring the DPRK out of  material losses, and to give it a financial  incentive to continue cooperation, and 2) cultural channels, emphasizing the "brotherhood" between the Korean people, thus reducing threat perceptions that the ROK is an "external" power encroaching malevolentiy upon DPRK sovereignty. Thus, even if  Pyongyang sees economic engagement as a bitter medicine with certain negative side-effects,  then cultural engagement is a potential sugar-coating that makes it politically easier to swallow. In the fourth  chapter, I will analyse how this strategy is perceived in Pyongyang, and what various aspects of  engagement mean to the DPRK in terms of  promises versus threats. As Scott Snyder has noted, "the central dilemma is that according to a brinkmanship strategy based on toughness, North Korea's greatest leverage is its potential threat, yet as it trades away the threat to gain the benefits  of  negotiation necessary to ensure its survival, leverage is diminished."1 While the DPRK regime has been challenged by economic and humanitarian collapse, it has been driven to engage out of  necessity. At the same time, engagement costs Pyongyang key political goods in its quest to maintain an "independent," militarist, pseudo-socialist ideological basis for  regime 1 Scott Snyder, Negotiating on the Edge: North Korean Negotiating Behaviour. (United States Institute of Peace Press, 1999) p 157 legitimacy. At that, despite North Korean demands for  "package solutions" to address its concerns, Pyongyang's underlying strategy has been to accept certain elements of  engagement-motivated domestic change, while maintaining a strong nationalist and militarist political position to emphasize regime legitimacy to domestic constituents. Economic reforms  and a reorientation of  "cultural goods" have occurred in North Korea in response to engagement, and yet these changes have not gone far  enough in addressing wider international concerns regarding DPRK development of weapons of  mass destruction. As I will illustrate, this should come as no surprise, given that the processes of  socialization and reform  are long-term, and are unlikely to alter the security landscape in significant  ways over a short period of  time. I will conclude with the final  analysis that engagement has, ironically, only further  motivated certain instances of  militarist and political belligerence, including the resurgent drive towards nuclear weaponization and an embellished military-first  political policy. As engagement fosters  reforms, reforms  shift  regime legitimacy, which in turn necessitates a revitalization of  external threat perception in order to preserve regime legitimacy. These "speed bumps," however, are not predictive of  the long-term failure  of  engagement, as deeper interaction with South Korea reduces the "politics of  economic desperation" that contribute to drastically risk-acceptant policy in Pyongyang. In spite of  the benefits  secured through a sustained engagement policy, the process of  integrating North Korea into a broad system of  international norms is non-linear in nature, as Pyongyang cuts away from  standardized reciprocity as a matter of  course. By understanding how the North Korean regime constructs legitimacy domestically, we can better measure the actual effectiveness  of  the Sunshine Policy on inducing positive behaviour in Pyongyang. C II A P T ER O N E Identifying  and Approaching Dissatisfied  Powers This chapter will first  analyze the concepts of  engagement, deterrence, and compellence, contrasting their methodologies and objectives, and evaluating their effectiveness.  Specifically  as regards engagement, there are several sub-streams that require analysis before  we can conclude whether "engagement" (and what type of  engagement) is most useful  in responding to dissatisfied challengers. From here, I will evaluate whether the strategies discussed are useful  when used alone: I will argue that mixed strategies are necessary for  sources to maintain versatility across various circumstances, and that neither engagement, deterrence, nor compellence is likely to yield sustainable cooperation if  they are employed dogmatically, without allowance for  the incorporation of  other strategies. Engagement, Deterrence, and Compellence Engagement  Theory We will first  need to understand what is meant by "engagement" and what such a course of action might involve. Chung In Moon has argued that engagement can be broadly conceived, seeking to influence  "people, policy, government, regime, system, and state sovereignty."1 Han S. Park has also taken a broad definition,  understanding the approach as "intended to induce the reclusive system to engage with the international community in various areas so that the system might be exposed to life  environments that are different  than its own."2 Within these definitions,  however, one may conclude that exposing a reclusive system, such as North Korea's, to different  "life  environments" is a goal in and of  itself,  whereas engagement is better understood as a change-oriented, results-based strategy for  source states.3 1 Chung In Moon, "The Sunshine Policy and the Korean Summit: Assessments and Prospects," in The Future of  North Korea (ed. T. Akaha: Roudedge, 2002), p 32 2 Han S. Park, North Korea: The Politics of  Unconventional Wisdom. (Lynne Rienner Publishers, 2002) p 105 3 Liam Roberts, "A Verifiable  Peace: North Korea and Prospects for  a Non-Proliferation  Strategy," Simons Centre for  Peace and Disarmament Research document (May 29, 2004) Moon has elaborated on this point, saying that such exposure is meant to induce change in the behaviour of  the target system, reducing its reclusive nature, and encouraging transparency and cooperation in various issue areas. Rather than vigorously seek to undermine the target regime, engagement in the North Korean case "simply presupposes that an increasing frequency  in exchanges and cooperation can spontaneously foster  North Korea's institutional and behavioral changes."4 I term this approach "pure engagement," which is a very liberal policy of  relentlessly delivering economic goods to targets in aim of  reorienting their value systems towards stable cooperation in other issue areas. Victor Cha agrees in part, though he advances a stricter engagement agenda with specific criteria for  reciprocation: "hawk engagement." This type of  engagement attaches more conditions to the delivery of  goods, though the purpose of  engagement is still ultimately to smuggle new norms into the target, thus socializing the target towards cooperation.5 Engagement, by both the hawk and the pure approach, is a change-oriented strategy designed to deal with problems that cannot be resolved through containment or deterrence measures alone. Hawk engagement, however, differs  in that policy options remain fluid  across a spectrum from  containment to engagement/' Political psychologists Thomas Milburn and Daniel Christie have examined engagement strategy through what they term "rewarding." A rewarding approach is "defined  as events that follow a particular behaviour and increase the frequency  of  the behaviour."7 There is an intentional directive on the part of  the engager, or source state, to modify  the behaviour of  the target state through establishing patterned and dependable benefit  flows  as a direct, causal result of  such modified behaviour.8 This resembles a pure engagement scenario in terms of  the socializing objective, although pure engagement requires more source-state initiative. The rewarding paradigm, what I will call 4 Moon (2002), p 32 5 Victor D. Cha, "The Rationale for  'Enhanced' Engagement of  North Korea: After  the Perry Policy Review," Asian Survey  39:6 (Dec. 1999): p 849 6 Ibid, p 846 7 Thomas Milburn and Daniel Christie, "Rewarding in International Politics," Political  Psychology  10:4 (1989): p 627 8 Ibid, p 628 "reactive engagement," leaves the target to take the initial cooperative step in aim of  securing consequential source-based rewards. As will be explored, this differs  from  source-based initiatives to solicit targets with specific  goods. It is difficult  to distinguish between utilizing a engagement strategy (to induce specific behaviour) and a deterrent strategy (to deter against specific  behaviour). The principle difference between an engagement and a deterrent strategy is in the difference  between encouraging a target towards  a specific  behaviour and encouraging a target away from  a specific  behaviour. The latter strategy indicates that there is a clear understanding of  what the target is to be dissuaded from  (such as proliferate  weapons of  mass destruction or pursue territorial expansion), thus this strategy encourages target non-action. Through deterrence, then, there is no clear source-state policy regarding what actions the target should take towards certain changes. Speaking to this point, Robert Keohane and Robert Axelrod have explored the debate with their "backseratching" and "blackmailing" typologies. As they note, "[b]ackscratching entails a promise. Blackmailing, by contrast, implies a threat."9 Both strategies are directed at influencing  a target state's behaviour, with the first  enticing cooperative behaviour, and the latter coercing against harmful  behaviour. The end result — cooperation — may be the same. The process, however, differs  in the important sense that either the target is encouraged to take on unprecedented actions (engagement), or it is encouraged to restrain its actions (deterrence). Deterrence  Theory Whereas a deterrent strategy seeks to maintain the status quo, successful  engagement seeks to alter  the status quo towards a new circumstance in which the target state is behaving in new ways. Milburn and Christie bemoan that "it is inadequate merely to deter unfavorable  change; to use the full  range of  influence  strategies, one must also seek to encourage behavior in desirable directions."10 9 Robert O. Keohane and Robert Axelrod, "Achieving Cooperation Under Anarchy: Strategies and Institutions," World  Politics  38:1 (1985): p 240 10 Milburn and Christie (1989), p 629 Patrick Morgan has defined  two types of  deterrence: general and immediate. A general deterrence strategy is more ambiguous, less issue specific,  and predicated around potential and unspecified  challenges the target may pose. By contrast, a source state would contemplate immediate deterrence to focus  much more clearly on deterring specific  actions that are limited in scope and time.11 General deterrence offers  the advantage of  incorporating broader security concerns into the defense  posture of  the source state, yet is problematic in that 1) there is no specific  "exit strategy" in a deterrent posture against unspecified  challenges, and 2) target states may continually test the bounds of  the deterrent posture, thus is "vulnerable to challengers who make menacing moves to see if  they can't induce the deterrer to strike a bargain."12 Milburn has noted that threats themselves do litde to change underlying motives, but rather, they simply constrain a target state's capacity to act on its ostensibly inherent motives.13 Threats are then used to prepare for  a case in which the adversary is seen as incapable of  genuine change, and when aggressive or negative behaviour is viewed as an irrevocable component to its policy.14 While threats are then useful  in some measure when dealing with targets that are not transparent or are not demonstrably trustworthy, James Davis concurs with Milburn that successful  bargaining must lead to fundamental  changes in an adversary's preferences,  rather than only the repression of  an adversary's capacity to act.15 At that, changing a target's mind is not equal to simply tying their hands. Morgan, however, has also argued that deterrence encounters key problems within its logic, particularly regarding how source states may misperceive the decision-making process within the target state. Deterrence assumes that the target will be paralysed from  disturbing the status quo when it calculates that such action will result in exorbitant losses, i.e. a military strike. Yet, there are various processes by which a target state may challenge a deterrent threat and pursue a challenge regardless, 11 Patrick C. Morgan, Deterrence Now. (Cambridge University Press, 2003), p 80-82 1 2 Ibid, p 83 1 3 Thomas Milburn, referenced  by James W. Davis, Threats and Promises: The Pursuit of  International Influenc e. (Johns Hopkins University Press, 2000), p 19 14 Peter Hayes, "Bush's Bipolar Disorder and the Looming Failure of  Multilateral Talks With North Korea," prepared for  the Arms Control Association, (Oct. 2003), <http://www.armscontrol.org/act/2003_10/Hayes_10.asp> 15 Davis (2000), p 19 and each process may be a rational one when considered through specific  preference  formations. Morgan poses that, if  the dissatisfied  power pursues a given challenging objective regardless of  the deterrent threat it faces,  the target may 1) value the objective more than the probable costs of  attack, 2) value the objective enough to call the deterrer's bluff,  3) miscalculate the cost-benefit  ratio of challenging the status quo, while still rationally attempting such calculation, 4) have perceived itself  as having no acceptable alternative, or 5) simply be irrational.""' Options 1 through 4 are all rational / objectives, and what may appear to be "irrational" action from  outside may be either action that is rationalized through a different  set of  values and preferences,  or action that has been rationalized through inadequate intelligence. Addressing the former  point, successfully  deterring a target from  specific  action entails understanding what the target values most, and what it is willing to risk in order to either curtail losses or make new gains. Such values will be specific  to each case in question, necessitating thorough qualitative analysis.17 As Gordon Craig and Alexander George have argued, "not all actors in international politics calculate utility in making decisions in the same way. Differences  in values, culture, attitudes toward risk-taking, and so on vary greatly."18 When faced  with the North Korean case, then, we may ask: Is face-saving,  reputation, and ideology of  greater import than material goods and security? Why would this be so? What experiences have shaped elite preferences,  and who is making decisions within the target state? Compellence  Theory Are threats then solely used to motivate tolerance of  the status quo, or can threats also be used to coerce certain non-status-quo actions? Davis explores the question through distinguishing between compellence and deterrence, both of  which he argues may incorporate threats and/or promises. A strategy of  compellence through threats asserts that the target state must act, or else face 1 6 Ibid, p 69 17 Ibid, p 77 1 8 Gordon A. Craig and Alexander L. George, Force and Statecraft:  Diplomatic Problems of  Our Time. (Oxford  University Press, 1995), p 188 dire consequences, up to and including military action from  the source to the target. l;) Deterrence through threats, though, is limited to asserting that the target simply not act in a particular way.2" There are specific  difficulties  inherent in a compellence strategy. Firsdy, compellence through threats is more difficult  to justify  to either domestic audiences within the source state or to the international community. Threatening a target state to change its ways, or else face  military action, is difficult  to justify,  as it impinges upon the target state's sovereignty in a unilateral fashion. Unless the target is, itself,  threatening to disturb the status quo in violent ways, compelling the target to change its policy through threat of  force  would be an example of  a hegemonic abuse of  power. Deterrence may be seen as stricdy enforcing  the law, whereas compellence may be construed as forcing  a new set of  norms upon an actor at the time of  the source's choosing.21 Davis argues that it is possible for  compellence to be based on a reward structure, arguing that "[successful  compellence when based on promised rewards may be more efficient  than compellence based on threats. Whereas compellence by threats requires the source to initiate action, the requirements of  compellence based on promised rewards are more like those of  threat-based deterrence. The source sets the stage, structures the incentives, then waits for  the other side to move."22 While this may place the burden of  responsibility upon the target, it is difficult  to conceive of  actual "compellence" through promises, as a target state cannot said to be "compelled" to act through promises of  gains. Incentives and promises can induce and persuade a target, but they do not involve cutting short the absolute baseline of  expectations held in the target state. As David Baldwin has noted, " 'If  you do not do X, I shall not reward you' is a punishment if  — and only if— (the target) had a prior expectation of  receiving the reward."23 If  such expectation has already been internalized, it is not a new set of  incentives, but has been construed by the target as the status quo. If  a target incurs losses relative to the status quo thanks to actions from  a source, then, this is no 19 Ibid, p 23 2 0 Ibid 2 1 Davis (2000), p 23 2 2 Ibid, p 24 2 3 D. A. Baldwin, "The Power of  Positive Sanctions," World  Politics  24:1 (1971): p 26 longer a coherent definition  of  promise, but better resembles a threat. "Promises are contingent improvements in a target's value position relative to its baseline of  expectations. Threats are contingent deprivations relative to the same baseline."24 Amos Tversky and Daniel Kahnemen expound upon this point in noting that an actor will feel  "compelled" to act when confronted  with losses, but not when confronted  with gains. According to them, "the displeasure of  losing a sum of  money exceeds the pleasure of  winning the same amount."25 In this case, motivated by the fear  of  losing, a target will be placed in a situation of compellence. If  motivated by possible gains, though, the target will preserve its sense of  choice in the situation, and thus is hardly "compelled" to act, but rather induced. This would seem to suggest that compellence through threats is more likely to yield positive returns for  the source state, whereas engagement is an uncertain strategy that does not rigorously restrict the target's capacity to advance belligerent foreign  policy. It should be noted that this type of  rational choice argument is not identical to Morgan's prior argument regarding rationality. The Tversky and Kahneman approach speaks to the differing responses that can be expected depending on whether a target is confronted  with gains vs. losses. Morgan and the political psychological school, though, argue that "gain" and "loss" are rather relative terms, and that targets may value certain goods above others according to a process of  preference formation  that may be different  from  what the source expects. Thus, it is not only motivations by loss that inspire more risk-tolerant behaviour, but specific  targets may perceive loss where external actors would perceive gain. Furthermore, compellent threats will not necessarily drive a target state to "act" in a way that is acquiescent to the source state. When faced  with threats and the prospect of  further  losses, the target state may become more risk-acceptant, driven by a sense of  preserving what it already has. Davis explains that "decision makers motivated by insecurity and fear  of  loss tend to display 2 4 Davis (2000), p 12 2 5 Amos Tversky and Daniel Kahnemen, "Rational Choice and the Framing of  Decisions," journal of  Business 59:4 (1986): pp 258-9 relatively high tolerance for  risk and brinkmanship." It is less likely that a state will take on great risks to secure new gains.26 Since a deterrent threat is designed to maintain the status quo, it may be reasonable to assume that the target does not lose significant  face  by complying with the deterrent by exercising restraint — this is to say, it is possible for  the target to justify  its maintenance of  the status quo. A compellent threat, however, presents the target leadership with a strong dilemma, in that compliance to "follow  the leader" is not easily sold domestically, and can undermine regime legitimacy at home. Davis argues that "[w]hen compliance with the terms of  another's threats confronts  a decision maker with loss of  face  both abroad and at home, escalation may appear preferable  to retreat."27 Morgan is not as certain that the line between compellence and deterrence will be drawn identically between source and target states. For example, should the United States use threat persuasion to discourage DPRK nuclear development, the source state in this case may, by its own logic, be following  a deterrent strategy: "one more step, and I shoot." By DPRK logic, however, this may be seen as compellence, as Pyongyang had never actually threatened to attack or to disturb the international status quo in specific  ways. They may read the threat as: "dance to my tune, or I shoot." Thus, where source state policymakers may calculate target reactions according to deterrent criteria, the target may actually respond in unpredictable (yet no less rational) ways.28 This is not so much a function  of  a Tversky-styled, cost-benefit  calculation through a universal rational choice model, but more a function  of  organically-generated preference  formations  that assign more value to certain goods (ideational goods, demonstrations of  face-saving,  etc.) than to other goods (material goods, international "backpatting," etc.)29 2 6 Davis (2002), p 31 2 7 Ibid, p 22 2 8 Morgan (2003), p 82 2 9 Iain Johnston and Paul Evans have used the term "backpatting" to describe the apparent advances in international prestige that an engagement target may accrue. As targets develop an appetite for  an enhanced reputation in international circles (by their argument, especially through institutions), these social goods may become political goods that enter into a target's sense of  political endowment. See Alastair Iain Johnston and Paul Evans, "China's Engagement with International Security Institutions," in Engaging China: The Management of  an Emerging Power (ed. I. A. Johnston and R. Ross: Routledge, 1999), p 237, 252 Overall Mindful  of  the possibilities for  misinterpretation between source and target as to which strategy is being pursued, we can distinguish between the theoretical rationale for  engagement, deterrence, and compellence by the following  definitions: Figure  1.1: Methods  and  Objectives in Managing  Dissatisfied  States Logic Method Objective Engagement Rewards-based • Status-quo transforming Deterrence Threats-based Status-quo preserving Compellence Threats-based Status-quo transforming Engagement, then, is a rewards-based initiative that offers  the target gains for  cooperative action, and nothing for  the status quo. The target enjoys a relatively high degree of  space in determining its own participation rate with the source without risking losses. Deterrence works conversely: it is a threat-based initiative that offers  the target losses for  challenging action, and nothing for  maintaining the status quo. The target is relatively constrained by fear  of  incurring further  losses, but neither is it necessarily motivated to alter the status quo. Compellence is more extreme, as a threat-based initiative that demands the target pursue a specific  alteration of  the status quo, but it may motivate the target to confront  the source, and thus may generate tension and raise the odds of  conflict. In the above table, I have not alluded to a link between a rewards-based method and a status quo preserving objective, as we should proceed with an understanding of  engagement as a change-oriented strategy. If  a dissatisfied  state was driven to disturb the status quo in either limited or revolutionary ways, and a source state sought to mete out rewards to encourage a status quo preserving objective, this would not be engagement, but rather "appeasement" — the delivery of  gains has no sunset clause, nor any timetable for  reciprocal expectations of  any kind, excepting that the target abide by general norms of  international behaviour. Appeasement, then, is much costlier than engagement, as only the latter is driven by the endgame of  inculcating either specific  or broad changes in the target. A variety of  engagement sub-streams, as described above, will also vary in terms of  their cost, contingent on their applicability to specific  targets. In none of  these sub-streams, however, do we see appeasement's key flaw:  buying targets out without any objective of  socialization or status-quo change, and no mechanism to advance long-term compliance. Mixed Strategies: Striking the Case-Specific  Balance These three strategies are not necessarily exclusive, and can be used in combination. Some scholars have advanced deterrence as an adequate efficient  strategy without bringing engagement initiatives into the fray,  although I argue that "pure deterrence" policies (or unmixed deterrence) limit the source in its ability to confront  new challenges, and do not lead to long-term preference formations  towards cooperation. For example, deterrence is thought to benefit  from  three characteristics: first,  deterrence places the burden of  action upon the target, thus also placing the cost of  action upon the target. Stephen Rock has intimated that engagement costs the source state when the strategy works (offering incentives), while deterrence only costs the source when the strategy fails  (making good on threats).30 By this argument, engagement requires the source to deliver costly promises in the hopes of  receiving returns, but without guarantees for  such returns. This makes engagement a risky investment. Secondly, deterrence is seen as a strategy that does  guarantee positive returns, as states confronted with threats will have less incentive to disrupt the status quo. For actors that cannot be readily trusted to keep promises, manage transactions, and communicate transparently, deterrence is able to 3(1 Rock has used the word "appeasement" in place of  "engagement," though he argues that the two words are interchangeable in their definitions.  The difference  between the terms, he argues, is that "appeasement" has acquired a negative connotation over the course of  the 20th Century, stemming largely from  Britain's unsuccessful  appeasement effort  towards Hitlerite Germany in the 1930s. This has had the effect  of  motivating contemporary policymakers and academics to use the less-tarnished word "engagement" for  policies that are essentially appeasement policies. However, I distinguish appeasement and engagement more decisively as rewards-based, status-quo preserving (less sustainable) and rewards-based, status-quo transforming  (more sustainable), respectively. See Stephen R. Rock, Appeasement in International Politics. (University Press of Kentucky, 2000), p 7, 22 function  without depending on these advances. Thirdly, deterrence enables the source to project itself  as stalwart, serious, and prepared to follow  through with difficult  measures to advance its interests — this, contrasted with what has been termed the "psychological effect"  of  an engagement strategy, which may indicate to the target that the source is irresolute, weak, susceptible to manipulation, and fundamentally  unwilling to commit to conflict. 31 Rock's understanding of  engagement, however, is convoluted with the term appeasement, and much of  his critique is a critique of  the latter. Despite this, his points regarding the pragmatism of  deterrence are points well taken, although I argue that the merits of  a deterrence strategy do not hold if  deterrence is to be employed as the sole strategy. It is through mixing deterrence with engagement that sources can maximize influence  over target states. Each of  the aforementioned merits of  deterrence can be easily critiqued if  taken alone. Firstly, it is not true that deterrence is essentially less expensive than engagement. In order for  threat-based deterrence to be salient, the source must maintain the capacity and the commitment to be a credible threat: this includes military bases, infrastructure,  personnel, and materiel within proximity to the target state. The source must continually sustain the advantage in arms competition vis-a-vis the target, which requires a capacity to endure and dominate an arms race. Furthermore, the source must demonstrate its power and its willingness to engage in conflict  if  necessary, either through military exercises with proximate allies, missile tests, or symbolic and rhetorical policy statements. Should the source be provoked to make good on its threats (i.e. if  the target follows through on its challenge despite the deterrent threat), then the cost of  conflict  can be catastrophic. As former  South Korean commander-in-chief  General Luck suggested to American scholar Leon Sigal, "If  you fight,  you win. But you spend a billion dollars, you lose a million lives, and you bring great trauma and hardship on the psyche of  both countries, so I'm not sure winning is a win."32 3 1 Rock (2000), p 4 3 2 Luck as cited by Leon V. Sigal, Disarming Strangers: Nuclear Diplomacy with North Korea. (Princeton University Press, 1998), p 155 There is little doubt that deterrence costs when it fails,  but success comes at a high price as well, as the source must constandy maintain the elaborate infrastructure  necessary to sustain a credible threat. Also, by Davis' understanding of  threat-based strategies such as deterrence, it could not be expected that the target state will undergo the fundamental  changes to its belief  structure when confronted  with threats. Since threats only paralyse target decision makers from  making challenges, rather than reorient preference  formation  away from  challenges, deterrence needs to be maintained indefinitely  if  used alone (more so by Morgan's understanding of  general deterrence). An engagement approach, however, attempts socialization of  the target into a new set of  norms and expectations, and thus while there is no clear timetable for  when engagement can be said to truly "end," there is no question among engagers that it shall  end at the point the target internalizes the benefit  flows  of cooperation. In a pure deterrence scenario, there is no conceptualization of  how the strategy is to end, and thus it is with deterrence (not engagement) where we are in want of  an "exit strategy." The only conceivable exit strategy is the actual delivery of  threats — tantamount to deterrence theory's failure. As for  the second advantage of  deterrence, that it guarantees the status quo since target states will be less willing to defect  when confronted  with potential losses than they will when confronted  with potential gains, this over-generalizes the target's potential motivations. As argued before,  if  the target is already motivated to act aggressively by internalized vulnerability, insecurity, or material losses, further  pressure in form  of  deterrence may drive the target towards confrontation.  As Thomas Schelling has argued, deterrence strategies towards targets motivated by losses invites confrontation,  unless coupled with an engagement stream that produces assurances. "Any coercive threat requires corresponding assurances; the object of  a threat is to give somebody a choice... 'One more step and I shoot' can be a deterrent threat only if  accompanied by the implicit assurance, 'And if  you stop I won't.'"33 These assurances themselves do not constitute "engagement," but without established engagement streams between source and target, there will be little reason for  the target to 3 3 Thomas Schelling, Arms and Influenc e. (Yale University Press, 1967), p 74 believe in the assurances. Engagement, in combination with deterrence, allows a source can demonstrate to the target that a condition of  perpetually continuing losses is not inevitable. From this point, we can understand how engagement channels deliver more than economic links and material incentives, but also mitigate against threat perceptions and reify  "trust." Without such channels, low levels of  communication will continue to obscure mutual perceptions, and low levels of  trust between adversaries will continue. The political psychological school has developed this point very thoroughly, as Davis has noted that adversaries will tend to "assimilate ambiguous information  to pre-existing belief  structures."34 Milburn and Christie also argue that "cognitive biases" between adversaries tend towards suspicion, and so even conciliatory efforts  towards rapprochement made by a source towards a target may be interpreted as false,  or a kind of  "clever trick."35 By following  through on delivering incentives for  cooperative action, these cognitive biases can be eroded, leading towards a stabilized relationship between source and target.36 Conclusions We have seen various sub-streams of  engagement described above. Pure engagement would be unmixed with deterrent measures, and would not involve strict conditions for  reciprocity from  the target. Hawk  engagement, conversely, offers  targets incentives while also offering  a powerful deterrent against challenges. This type, advanced by Cha, also comes with stronger conditions for reciprocity, evidence of  cooperation, and specific  reforms  inside the target. Reactive engagement is the most distant of  the three: rewards are meted out by the source in response to specific  demonstrations 3 4 Davis (2000), p 40 3 5 Milburn and Christie (1989), p 631; Davis (2000), p 22 3 6 This has been readily observed in the mixed engagement policy pursued by Washington towards Beijing. This mixed strategy supplanted an openly hostile strategy of  deterrence in the early 1970s. Nixon's visit to Maoist China came near the height of  the Cultural Revolution (generally accepted as between 1966-69), one of  the least transparent and most totalitarian periods in modern Chinese history. The tertiary links formed  between China and the West (in combination with a deterrent against PRC expansion into Taiwan or Southeast Asia) helped to legitimize and empower reformist  elements within the Chinese leadership, notably Deng Xiaoping. For more on mixed engagement with China, see Charles Burton, keynote address to the consultation on the Democratic People's Republic of  Korea, Canadian Foodgrains Bank, Toronto (October 20, 2003), <http://www.cankor.ligi.ubc.ca/issues/139.htm>: Also see David Capie and Paul Evans, The Asia Pacific Security Lexicon. (ISEAS, 2002): Even engagement-skeptic Aidan Foster-Carter has observed that the cases of China, and eventually Vietnam, prove that building positive ties over the course of  years has led to constructive evolution in regime behaviour. See Aidan Foster-Carter, "North Korea: Here We Go Again," PacNet Newsletter (August 9, 2002), <http://www.csis.org/pacfor/pac0231A.htm > of  cooperative behaviour by the target, thus advances a much more issue-based, tit-for-tat cooperation. Whereas pure engagement relies too heavily on the "hope" that norms of  cooperation will emerge spontaneously inside the engaged target, reactive engagement does not rely enough on the transformative  power of  engagement's liberal and constructivist foundation.  Between these extremes is the mixed hawk engagement paradigm, which has distinct advantages in terms of  its clear results-oriented focus,  its flexibility  between incentive and threat, and its objective towards socialization of the target. I agree with Cha's mixed structure, although I emphasize less fluidity  across the spectrum between engaging and deterring. Engagement streams need to be dependable, and cannot be curtailed at early signs of  target resistance. To do so denies engagement its capacity to effect  the long-term objective of  socializing the target state into new norms. As such, I combine elements of  Moon's (pure) and Cha's (hawk) arguments in what I term active  engagement. An active approach tends towards pure engagement in 1) its emphasis on exposing the target state to external actors through economic channels, which can generate organic and internal reform  (as opposed to explicit, externally mandated reforms)  and 2) its "relentless" and constant application, abetting long-term change even when confronted  with a belligerent and resistant target. Thus, there is less fluidity  across the spectrum of  deterrence and engagement than in hawk engagement. Active engagement tends towards hawk engagement, though, in 1) its emphasis on maintaining a parallel deterrent strategy to constrain target deviation from  uncooperative action, although abrogation of  engagement streams should be avoided, and 2) its higher standard for reciprocity and conditions for  engagement to continue. These conditions do not need to be elaborate or potentially threatening in the early stages of  an active engagement policy, but can be small, de-politicized, technical and logistical matters should be incorporated as conditions of  engagement, thus giving the source nascent footholds  into the inner workings of  the target state. To become dependable, "trust" should become increasingly internalized within the target, and this is done through fostering  mutual dependence on successful  cooperation and reducing the incentives for  defecting  from  such cooperation. Thus, until these incentives are incorporated into the target's sense of  endowment, one cannot say that engagement has yet been fleshed  out. The target must already depend on carrots as a staple food,  not as a luxury item. Morgan also sees engagement streams running parallel to a deterrent as the surest way of corroding the key motivations of  the target's challenges, be they primarily economic, geopolitical, or diplomatic in nature. P3]e tough but not bullying, rigid, or unsympathetic; be conciliatory without being soft.  This is because ... the strength of  the challenger's motivation is crucial — weakening it by concessions and conciliation can make chances of  success much higher. However, if  the challenger is motivated by hopes of  gain only, conciliation may only provoke further  threats. Hence it is important to also guard against being exploited.37 As we have come to understand deterrence, it is a limited (and rather cosdy) strategy if  it does not include any parallel engagement streams and assurances to provide targets with options for cooperative, status quo modifying  behaviour. Pure engagement, without offering  any conditions, stipulations, threats, or negative alternatives, may also be seen as functionally  limited and costly. This type of  rewarding scenario will not be adequate in the objective of  socializing the target, as long as the target is free  from  any reciprocal obligations. 3 7 Morgan (2003), p 162-3 C H A P T Ii R T w o Theoretical Considerations for  Engagement Approaches As argued in the first  chapter, engagement and deterrence, when used in concert, can help to structure a flexible,  two-tiered approach for  sources confronted  with dissatisfied  challengers. In the following  chapter, I will explore in greater detail how this mixed approach can be applied, and to which types of  potential target states it is best directed. While the engagement literature generally speaks from  the perspective of  source states, the perspective of  the target has been largely absent. What motivates target reactions to various types of  engagement? Negative cognitive biases, domains of  losses vs. gains, and target perceptions of  "promises" vs. "threats" will all combine to affect potential responses. Such responses may be out of  step with source state expectations without particular qualitative analysis of  the target. This analysis must focus  on determining which goods the target values most, and which goods are threatened by either the status quo or a revised status quo. As will be seen, the example of  specifically  inter-Korean engagement presents opportunity for cultural symbolic goods to enter into the process, which lends particular advantages to this process. From the discussion in the previous chapter, we have established various definitions  of engagement. From here, I will begin the more detailed analysis through distinguishing more clearly between engagement and appeasement. Engagement and the Status Quo: Maintenance or Modification? Deterrence is employed by a source to prevent a target from  taking an aggressive action, while engagement is employed by a source to encourage a target to taking a cooperative action. Thus, not only does engagement require the source to develop a more comprehensive program of expectations, but engagement is also driven towards a modification  of  the status quo — deterrence seeks to maintain the status quo, and to prevent its disruption. In concert, then, engagement and deterrence can combine to "escort" the target towards a modified  status quo in a closely guided fashion.  As Davis has argued: When a challenger is motivated by perceived opportunity and is met with credible threats, restraint is the likely outcome. This is the class of  events captured by standard deterrence theory. Restraint is also likely to obtain when challengers motivated by vulnerability are met with promises. However, when opportunity-driven aggressors are met with promises, increased demands for  revision in the status quo are the predicted outcome. And when . aggression is motivated by a sense of  vulnerability, threats are predicted to produce counterthreats and deepening spirals of  crisis, if  not war.1 Stephen Rock, for  one, does not entirely agree with this: he has argued that engagement can either be short-term in nature (immediate: dealing with direct and limited-aims target concerns), or long-term in nature (general: involving "package solutions" addressing a range of  grievances). Secondly, engagement in Rock's view can be either status quo preserving, or status quo modifying. 2 These understandings are problematic. Firstly, "short-term" versus "long-term" engagement is ultimately the distinction between appeasement and engagement. The delivery of  incentives with short-term objectives is tantamount to "buying off'  a dissatisfied  power.. The "short" nature of  such action, though, negates any opportunity for  socialization of  the target, or the inculcation of  new norms of  cooperation, thus disregarding the change-oriented, constructivist elements to engagement objectives. Engagement, then, is inherently long-term in nature, and addresses a range of  concerns that motivate dissatisfied  challengers — as Rock acknowledges in his understanding of  long-term strategy, sources pursuing engagement seek to fundamentally  change the nature of  their adversarial relationship with the target, "securing good will and cooperation on matters of  common concern."3 Secondly, Rock's view that engagement can be status quo preserving also brings us into an appeasement paradigm. Using an incentive structure to preserve the status quo is akin to the perpetual payout, as there are no criteria by which a target is to be judged a "changed" or socialized state when the source essentially commits to no more than paying a lease on a stabilized status quo. Is appeasement as per Rock inherently problematic and perpetual? Rock unfortunately  neglects to address the nature of  the target state's ultimate aims in asking this question. Is the target expansionist: does it seek large-scale and global changes to a system perceived as fundamentally  flawed?  Or, is the 1 Davis (2000), p 5 2 Rock (2002), p 12 3 Ibid target revisionist: dissatisfied  by its position in the system or in regional power arrangements, but without threatening the integrity of  the international system itself? If  a source, desiring status quo preservation, addresses an expansionist target with engagement, this is akin to saying "I will buy you a sandwich if  you promise not to go rob the bank." The risk is that the issue at stake is not that the target is hungry, but the target seeks to upset the social order to make profound  gains. As such, it is wrongheaded for  the source to assume that the target won't simply rob the bank after  having eaten the sandwich. Engagement to maintain the status quo only feeds  the target without offering  any negative repercussions for  violating the terms of cooperation, and can only cost more than a deterrent measure, such as "I will arrest you if  you go rob the bank." In the case of  targets that do not want to fundamentally  alter the international status quo themselves, but are driven by a fear  of  vulnerability, or a domestic status quo that produces increasing losses, engagement is driven by altering the status quo that drives dissatisfaction  or threatening behaviour. "I will buy you a sandwich if  you polish my shoes. If  you do a good polishing job, I will pay you for  the service. If  you do an excellent job, I will pay you and refer  you to other potential clients." The issue at stake for  such a target is not upsetting the social order, but satisfying its own increasing hunger. Engagement here seeks to alter the status quo by inducing the target to change in order to remedy its existent losses. Here, we are reminded of  Davis: "Strategies based on promises and assurances appear to be most successful  when the (source) state is confronting  an adversary driven by security concerns and not intent on exploiting opportunity for  relative advantage."4 Deterrence, then, buffers  the capacity for  engagement to work by saying "I will arrest you if  you loiter on this street," as this gives the target a choice between a) ignoring the work opportunity, thus making no money and  going to jail, or b) taking the work opportunity, thus making money and  avoiding a criminal record. 4 Davis (2000), p 31-2 Engagement and Target Objectives: "Limited-Aims" or "Revolutionary"? The balance between deterrence and engagement in inducing specific  action can be difficult to strike, and is highly dependent on inferring  whether a target is expansionist in its aims, or limited: the more expansionary, the greater the need for  deterrence, and the more limited, the greater the utility of  engagement. Randall Schweller has outlined the following  typology in responding to dissatisfied  powers: Figure  2.1: "Politics  in Response to Rising, Dissatisfied  Challengers" 5 Risk averse Risk acceptant Limited-aims revisionist Engagement, binding Engagement through strength, deterrence, Revolutionary Deterrence, balancing Preventive war Schweller's typology describes various source policies in confronting  different  types of "rising" dissatisfied  challengers, which refers  to targets with an increasing capacity to wage a sustainable war. Despite this, an engagement strategy is not bound to use with rising challengers, but in the case of  loss-motivated risk-acceptant states, may be used with "declining challengers": states which are prone to lashing out or escalating tension from  a position of  deteriorating relative power/' Schweller rightly notes that engagement with "revolutionary" states is not an ideal option, as these states seek to alter the international status quo: as argued in the previous chapter, sources that desire status quo preservation are best to pursue threat-based measures in order to prevent this type of  action. Determining whether or not a challenging state is truly revolutionary or is limited in its ambitions for  change is key to developing a coherent policy towards the target. Schweller 5 Randall Schweller, "Managing the Rise of  Great Powers: History and Theory," in Engaging China: The Management of  an Emerging Power, (eds. A. I. Johnston and R. Ross: Roudedge, 1999), p 24 6 Ibid distinguishes limited-aims revisionist states as merely dissatisfied  with their place in the system, and as such, they seek to correct their position through challenging major players within the system. Revolutionary states are more severely dissatisfied,  not only with their position in the hierarchy of prestige, but also with the entire constitution of  the international system.7 While revolutionary states "cannot be satisfied  without destroying the status quo order," limited-aims revisionist states are typically regional powers that seek adjustments to decision-making procedures within international regimes, and "recognition" among the great powers of  the smaller, dissatisfied  state as an equal.8 Schweller notes that risk averse revisionists may be confronted  with binding and engagement. These strategies need to be distinguished from  each other. While both strategies share the ultimate objective of  influencing  the behaviour of  a target through creating common, dependable channels, they differ  in the sense that a binding strategy creates institutionalized, formal  and legal channels (perhaps involving negative security assurances, and at its extreme, alliances) with targets to achieve this cooperative behaviour. Binding is the act of  "incorporating the rising power in existing institutional arrangements" in order to satisfy  the target state's desire for  prestige and to entangle it in a web of  institutional arrangements which restrict its capacity for  defection. 9 A binding arrangement is thus more legalistic than an engagement strategy, the latter of  which seeks to encourage reforming the target's self-identity. The usefulness  of  binding is limited to risk  averse states, however, as the fundamental grievances exhibited by the target will first  need to be sustainably addressed by the very states that constitute the institutions being proposed — without socialized and internalized norms of  mutual trust between state parties, no institutional arrangements will prove overwhelmingly decisive. I argue that engagement and binding are not two variants of  the same strategy, but that there is a linear path from one to the other: engagement must come before  binding. This is so because binding relies on institutions and international regimes (including treaties, or agreements reached within international 7 Ibid, p 19 8 Ibid 9 Ibid, p 13 organizations), and such regimes depend on established state-state cooperation beforehand.  This is the prerequisite work of  an engagement strategy. As Schweller characterizes engagement as a broader attempt to "socialize the dissatisfied  power into acceptance of  the established order,"10 binding can come only once that established order is fundamentally  accepted by the target, and only issues of specific  coordination remain as obstacles between source and target. Thus, engagement is a state-based initiative that establishes common channels upon which both parties are dependent. After  this, binding essentially reifies  these channels into elaborated regime structures. One question is, if  limited-aims non-revolutionary targets are not serious threats to the international status quo, why bother engaging them? Why should a source buy sandwiches for suspicious strangers who may want nothing to do with the source's reformist  agenda? The first response would be that even limited-aims dissatisfied  powers present risks to the international order, particularly when such powers are in a continuing domain of  losses. An engagement source seeks to alter the status quo towards delivering gains before  the target is driven towards "lashing out" or outright expansionism.11 A lash out scenario is probable when a dissatisfied  power is kept in a domain of  continuing losses without hope of  reversal, and rationally chooses to close an "expanding window of  vulnerability" through provoking tension or engaging in a military strike against adversaries, regardless of  anticipated negative repercussions.12 However, the empirical record is thin with examples of  dissatisfied  states lashing out through actually provoking pre-emptive war from  a position of  weakness. Limited-aims states may lash out, though, through repeated relatively low- to mid-level provocations, such as weapons proliferation,  nuclear weaponization, abrogation of  security agreements, and ultimatum-based brinkmanship negotiation tactics, as has been clear with the North Korean example. Lashing out may also take form  as bandwagoning with strong expansionist powers that do seek to challenge the overall hegemonic order. 1(1 Ibid 11 Victor Cha, ed., Nuclear North Korea: A Debate on Engagement Strategies. (Columbia University Press, 2003), p 18 1 2 Ibid, p 19 Engagement with limited-aims powers, then, is a logical strategy for  sources that 1) do not want to see targets lash out, 2) do not want targets to collapse or become failed  states, and 3) do not want targets to develop into expansionist powers or develop a drive to collaborate with expansionist powers. Deterrence is best employed when dealing with expansionist, revolutionary powers that seek to execute major shocks to the international order, military expansion, and destruction of  status quo regimes.13 Limited-aims revisionists are driven to challenge based on a domain of  losses, whereas revolutionary challengers are driven by the possible gains of  expansion. Thus, limited-aims revisionists should be dealt with through reducing the prospect of  loss, and revolutionary states through reducing the prospect of  gain. Gains-Based vs. Loss-Based Motivations By what criteria, though, can we deduce whether or not a revisionist regime is motivated by gains or by avoiding losses? Mistaking a gains-driven, revolutionary state for  a loss-driven, limited-aims revisionist state poses clear dangers, as Britain's appeasement strategy with an expansionist, gains-driven Hitlerite Germany clearly demonstrated. However, the converse is also a danger to be avoided: mistaking a limited-aims revisionist state for  a revolutionary one "unwittingly induce[s] such a conversion" in the target, as the target deems war inevitable and is able to rationalize preventative war or a first-strike  policy. In this way, a prudent engagement course would be what Schweller has called "engagement through strength" as the ideal for  confronting  limited-aims revisionist, risk-acceptant targets. This implies an active engagement strategy as defined  in the previous chapter: a policy which is "neither purely cooperative nor purely competitive, but instead a mixture of  both carrots and sticks."14 Cha's hawk engagement position is not far  from  this, as he notes that "today's carrots are tomorrow's most effective  sticks."15 The argument here is that a source can stabilize the trajectory of  continued target by delivering the benefits  of  international cooperation. The target 13 Schweller (1999), p 23 14 Ibid, p 24 15 Cha (2003), p 90 consolidates interests in both maintaining the international status quo (refraining  from  expansion) and enhancing its positional status quo (cooperating with international regimes). The process of  estimating whether a target is motivated by gains vs. losses echoes Morgan's warning that targets may perceive gains and losses according to different  criteria, based on a distinct strategic culture and process of  preference  formation.  Material losses, though, are tangible, and have a causal bearing on a state's capacity to survive. Even states that place relatively high value on ideational goods and face-saving  will need to avoid absolute material losses if  the regime is to remain in power. There is tension within the engagement debate as to whether successful  engagement is pursued by forming  issue linkages, or by maintaining issue separation. Should engagement be a comprehensive enterprise, in which the source seeks to place economic, military, political, and cultural issues into one basket, or should these various channels be pursued independently of  each other? Comprehensive vs. GRIT Engagement There are several channels that an engagement process seeks to create. Communication links can take the form  of  routinized official  meetings, prioritizing transparency and clarity in official communication, and the establishment of  security hotlines. Economic links can take form  as reduced barriers to bi-national trade and investment, conditional and renewable agreements on mutual most-favoured-nation  (MFN) trade status, and a concerted official  effort  to encourage such trade. In addition, furnishing  a state with access to international financial  institutions (IFIs) such as the World Bank (WB) and the International Monetary Fund (IMF) is ultimately both an economic and a political decision, with the consequence that economic benefit  flows  will come through development loans and/or an established presence in global trade. Stricdy political links will take the necessary form  of  ambassadorial representation, official  joint statements on issues of  mutual interest, abrogation of  the use of  force  in settling disputes, and ratification  of  bi-national treaties, most certainly including peace treaties should a state of  war technically exist. Cultural links can be established through sponsorship of  sports and arts events designed to bring together citizens from each country, as well as the encouragement of  civil society initiatives and Track II dialogue. The creation of  para-state commissions directed towards research can also help to focus  energy on gathering information  and offering  policy-oriented direction in each of  these spheres. How, though, is this process to be directed: towards separate agents and elements within a target state through a staggered, mutually exclusive system, or towards all elements simultaneously and interdependendy? We can distinguish between the linkage school and the de-linkage school by the terms "comprehensive engagement" and "GRIT (graduated reciprocal initiatives in tension-reduction) engagement." The comprehensive perspective argues that, for  either engagement or deterrence to be effective,  promises/threats need to be nested within issue linkages structured in an institutionalized forum,  and that engagement through economic, political, military, and social spheres need to be coordinated and advanced holistically. The argument is that, without backing up one's promises with an array of  institutional links, defaulting  becomes easier, as the "shadows of  the future"  (the expectations that benefits  of  a relationship are long-term and sustainable) are shortened.16 As an advantage, the target will be more reluctant to defect  from  a political engagement process, since this would also run the risk of  compromising security in other engagement areas, such as nascent economic links or progress on security issues. As such, the comprehensive school would advocate that the source should curtail all coordinated engagement activity when one or two issue areas are held up by the target, and "tough international pressure" should be exerted upon the target to comply.17 As a disadvantage, the comprehensive approach demands too much cooperation from  a target state that is essentially adversarial, and thus is less realistic. Comprehensive engagement may not necessarily be regime-based, and can remain bilateral and state-based, although this type of  linked engagement essentially puts all eggs into a single basket. 16 Cha (2003), p 21 1 7 Chung In Moon, Arms Control on the Korean Peninsula: International Penetrations. Regional Dynamics and Domestic Structure. (Yonsei University Press, 1996), p 231 The de-linkage school follows  what Charles Osgood has termed GRIT: Graduated Reciprocal Initiatives in Tension-reduction.18 A GRIT strategy seeks to engage the target across several issue areas without specifically  linking progress on one issue to progress on all. GRIT deconstructs large political issues into several small, tangible components, with various source agents acting to improve relations and deliver incentives in specific  issue areas regardless of  friction  and hold-ups in other issue areas. Davis has said that "a state pursuing GRIT devises a series of  small initiatives it can take unilaterally without endangering its own security in an effort  to induce cooperation from  an adversary."'9 The decomposition of  a large issue into several smaller ones has the advantage of  de-politicizing the large issue (general dissatisfaction),  thus avoiding the temptation for  the target to defect  from  the entire engagement process when its suspects the source of  being manipulative. As Moon has observed, the GRIT school believes that "decoupling" issues helps to foster  opening in the target on an incremental level, and thus is more realistic than presenting a target with a broad array of  reform  measures to be taken on.20 Milburn and Christie have noted that de-linking and prioritizing issues through a "gradation" approach allows for  incrementally improved contexts for  future  deal-making, with simpler, small-scale technical issues solved at the negotiating table before  any agreements of  graver import are dealt with.21 Davis argues that the GRIT approach may be pragmatic and moderate, but it does not do enough to bind the target to follow  the reformist  prescriptions inherent in any successful  engagement effort.  The target has the opportunity to "return to the posture that gave rise to the promise (from the source) in the first  place."22 The source's promises may be easier for  the target to believe when they are small and issue-specific,  but they will not be broad enough to allow for  the target to develop structural interest in sustained cooperation. 1 8 Davis (2000), p 17; also see Charles Osgood, An Alternative to War and Surrender. (University of  Illinois Press, 1967) 1 9 Davis (2000), p 17 2 0 Moon (1996), p 231 2 1 Milburn and Christie (1989), p 638 2 2 Davis (2000), p 18 While Davis' critique is sound, Snyder has observed that, in the inter-Korean context, the comprehensive approach has encountered the problem of  all eggs being put into the same basket. As Korean leadership has, in the 1990s, assembled "a whole host of  visionary objectives in order to achieve a symbolic political 'breakthrough' or 'package deal,'"23 a risk develops that the entire engagement project can break down and enter into a "cycle of  recrimination."24 Comprehensive engagement, then, may be a case of  putting the cart before  the horse: constructing binding mechanisms within an institutionalized forum  before  the necessary diplomatic legwork between source and target states  has been completed. Mindful  of  this risk, and especially given the difficulties  in addressing target states with extremely negative cognitive biases towards engagement sources, I argue in favour  of  a GRIT approach in the short- to medium-term, with a better institutionalized, linked engagement regime to follow  after  certain key issues have been independently addressed. The process of  establishing trust will be more sustainable if  issue-specific  tangible promises can be meted out by the source in exchange for  limited and clear political goods relevant to the issue at hand: package solutions are too susceptible to derailing should the engaging adversaries not yet have developed dependable channels of  engagement in limited areas. This flaw  in comprehensive engagement is readily observable in the experiences of  the Korean Peninsula Energy Development Organization (KEDO) in the late 1990s and early 2000s. As a regime that involved several state actors and the DPRK in regulating the delivery of  energy aid to North Korea, hold-ups and funding  issues stymied this mandate. The states involved in the regime had not yet solved fundamental  barriers to cooperation on bilateral levels, and KEDO's jurisdiction over the supervision of  light-water nuclear construction in North Korea was rendered redundant as the states involved in the process remained embroiled in bilateral hold-ups. 2 3 Scott Snyder, "Evaluating the Inter-Korean Peace Process," in Reconciliation in the Asia-Pacifi c (ed. Y. Funabashi: United States Institute of  Peace Press, 2003), p 25 2 4 Ibid As such, if  it can be agreed that engagement is a process of  sustained source-target effort  at maintaining and increasing communication, economic, political, and cultural links in the engager's aim of  reifying  trust between two adversarial parties, and minimizing the risk of  conflict,  then it follows  that building trust and sustained channels comes before  the institutionalization of  the process: again, engagement comes before  binding. This perspective avoids mandating an explicit drive by the engager to induce deep and immediate systemic change within the target system, and instead focuses  the process more direcdy on the engager's principal ambition: to sustainably minimize the risk of  conflict  while diversifying  policy options away from  a sole reliance on deterrence. Out of  this, Moon's observation that "spontaneous" policy adjustments will emerge in the target state towards positive behaviour is still valid: if  a target state is hitherto "unengaged," thus relatively isolated from  the international community and unbound by international conventions, the shift  away from  this status quo towards increased integration will naturally force  adjustments in the target's domestic policy. These adjustments, however, are not so much directed or instructed from the mandate of  the engager, but are expected to emerge through an active engagement that smuggles new values and exploits new factions  within the target. The term spontaneous is not meant to connote an inevitability of  target initiative: instead, active engagement through a GRIT formula offloads  the source's burden of  making explicit calls for  specific  reformist  changes, instead relying on internal target agents to develop structured interests in cooperation. In studying engagement with China, Johnston and Evans have noted that the target's self-identification  can change once certain domestic audiences develop a stake in the process. This speaks to the capacity for  an engagement process to exploit and nourish factional  elements within the target regime, as "[ijncreasing levels of  involvement lead to increasing returns from  participation, returns that are distributed across new actors who emerge to handle the agenda of  the institutions."25 As argued above, in the case of  risk acceptant states weakened by a serious domain of  losses, as is the case with the DPRK, institutions are not the ideal agent to administer engagement; this is more of  a 2 5 Johnston and Evans (1999), p 239 binding typology, and is best reserved for  interactions between mature cooperative powers. Nevertheless, the point is that incremental engagement on technical issues does not so much deliver explicit instructions to the target as to the conditions of  engagement, but creates new internal preferences  as the target develops a path-dependent cooperative agenda,26 albeit this may be limited to specific  issue areas in the beginning. Overcoming Cognitive Biases Milburn and Christie, though, note that when the relationship between engager and target is traditionally adversarial, there will be difficulty  in convincing the target that any external call for cooperative action is anything less than a "clever trick" designed to undermine the target state system,27 and this is possible even through an initial GRIT approach involving private rewards. As any type of  engagement is ultimately a change-oriented strategy designed to alter the status quo vis-a-vis a target regime (turning "rogue" regimes into normal players),28 the target may be suspicious as to why the engager is motivated to approach the target with any prospect of  tilting the measure of relative gains. Even absolute gains that a target may accrue through the process, in this light, are apt to be construed as negative relative gains by the apprehensive target. As explored earlier, the cost of  engagement can be high, as not only does such a strategy appear as appeasement when targeted towards resiliently non-cooperative states, but pre-established cognitive biases between adversaries can prevent the utilization of  an engagement strategy to induce a new positive perception of  the relationship. As D. A. Baldwin has suggested, "A may perceive himself  as employing carrots, while B may perceive A as using sticks,"29 with an engager's actions misconstrued by a suspicious target. Examples are not difficult  to uncover. A source state may use the prospect of  establishing most-favoured  nation trade status with a target as a principal "promise," contingent on good 2 6 Ibid 2 7 Milburn and Christie (1989), p 633 2 8 Victor D. Cha, "The Rationale for  'Enhanced' Engagement of  North Korea: After  the Perry Policy Review," Asian Survey  39:6 (1999), p 849 2 9 Baldwin (1971), p 24 behaviour and observable cooperation on several issues. This promise may not be a total incentive for  the target, however, if  such progress in developing international economic links actually threatens the political institutions within the target regime. This is readily perceivable in autarkic states with traditionally command economic systems. A GRIT approach may attempt to de-link economic and political spheres as far  as is possible, but as any engagement strategy is designed to socialize new norms and alter the political trajectory of  the revisionist state, a fundamentally  suspicious target will potentially "politicize" all types of  engagement. This reified  suspicion develops through cognitive biases that predetermine one state's interpretation of  another in an adversarial relationship: "A history of  hostile relations can result in a situation in which leaders on both sides take for  granted the aggressive intentions of  the other as hostile, ambiguous and even discrepant information  will be assimilated to that image."3" Negative cognitive biases, accumulated through historical trauma, reneged promises, and limited social and political communication, may "militate against the perception of  an initiative as a genuine reward."31 Even tangible GRIT initiatives, for  all their technical clarity, can conceivably be construed as part of a malicious and manipulative adversarial agenda — a Trojan horse not to be believed. This view assumes that leaders shape policy affected  by cognitive biases rather than proceeding with institutional, structural evolution of  policy through circumstance. The point is delicate; to what degree do adversaries develop policy based on negative cognitive biases? If  a target regime's leadership proclaims that it cannot participate in an engagement channel based on fear  of vulnerability accrued through past trauma, are such proclamations genuine, or are they part of  a target strategy to wring further  concessions from  an engagement-minded source? It becomes problematic to address this point through theoretical discussion entirely, as targets may be motivated by either genuine cognitive biases, or by carefully  crafted  'facades  of  trauma.' 3 0 Milburn and Christie (1989), p 630 3 1 Ibid, p 628 Target Indicators for  Engagement Feasibility Understanding what truly motivates a potential engagement target is not a straightforward endeavour, and examples will vary along with case studies and the particular histories of  each traditionally adversarial relationship in question. However, as explored in this chapter, there are several indicators that targets can reveal about themselves that are relevant to the engagement enterprise. Firstly, an analysis of  what the target deems to be a "loss" or a "gain" will need to be undertaken, keeping in mind that material gains may simultaneously present losses of  domestic political control, ideational integrity, and regime stability. Secondly, engagement strategies will need to be based on an evaluation of  whether the target is motivated primarily by losses or by gains. If  the dissatisfied  power is driven to challenge the status quo because remaining in the status quo presents increasing losses, then the inherent vulnerability in the target state is best addressed through providing promises, incentives, and assurances. If motivated by gains, a bias towards deterrence is more salient. Thirdly, if  the dissatisfied  power is in a dramatic material domain of  losses, it must be understood whether the dissatisfied  power is revolutionary or limited-aims revisionist. The latter type can be identified  through an analysis of  state demands, foreign  policy statements, and material capabilities relative to regional powers. If  the dissatisfied  power is primarily occupied with its position in the system, as opposed to the nature of  the system itself,  the state will behave more as a limited-aims revisionist power, and thus can be induced to participate in an engagement process. Furthermore, a materially weak state will not have the military, economic, or political capacity to act on any possible revolutionary impulses. While the state may be suspicious of  international actors and potential engagers' motives, a weak state will not endeavour to become expansionist to reach its target of  stemming the tide of  increasing losses. It may, however, lash out or bandwagon with revolutionary states if  the losses threaten regime survival.32 Once a loss-based target has its deficit  reversed, it will become less risk-acceptant, having acquired a stake in stability, and thus will move to the left  of  Schweller's table. A risk-averse limited-aims revisionist power will be one that is not primarily motivated by losses, since the losses have been curtailed through delivered promises. Once risk-averse, binding mechanisms that wrap the target into a greater array of  institutionalized cooperation can become more feasible.  First, however, the target will need to have internalized norms of  cooperation, incorporated the benefits  of engagement into its sense of  endowment, thus reducing the bias towards deterrent measures.33 A GRIT approach does not necessarily depend on a broad, synchronized inculcation of cooperative norms throughout the target state, but indeed, may succeed best when specific  agents receive benefits  and come to develop an endowment in cooperation. This may lead to the exploitation of  factional  fissures  within the target, with bureaucratic and reformist  agents becoming defenders  of  continued engagement, even while military or political agents remain suspicious, viewing the process as a clever trick. Davis has suggested that successful  promises would "target rewards to these elements within the opposing society that are most committed to defiance  in an effort  to influence  their calculations."34 I argue that identifying  domestic target agents who are potentially or latently defiant  towards their own leadership make useful  targets of  engagement, as this offloads  the burden of  soliciting cooperation onto domestic target elements. Furthermore, when sources deliver tangible gains to the target (gains by the target's own criteria), potentially internally-defiant  elements are empowered and 3 2 North Korea's resurgent nuclear weapons program may be interpreted by some as a revolutionary impulse, although I argue that Pyongyang does not seek to fundamentally  alter the international system through this program. As will be explored at greater length below, while nuclearization presents clear risks to the international community, particularly in regards to the non-proliferation  regime, the "deterrent" goal of  North Korea's program is rooted in ambitions to revise the relative balance of  power in negotiations that are essentially limited-aims revisionist, and of  purely national concerns or concerns to the immediate region. 3 3 Davis has described "endowment" as the baseline of  expectations an actor either has, or believes it deserves. Once a channel of  exchange, a material good, or a given service is no longer a potential benefit  but a part of  an actor's endowment, the actor will become very reluctant to see the good taken away. See Davis (2000), p 32 3 4 Ibid, p 25 legitimized within the leadership: the case was clear immediately prior to the rise of  Deng Xiaoping in China. Engagement efforts  through the 1970s largely empowered and legitimized reformist  factions in Beijing, paving the way for  Deng's return to the upper ranks of  the Chinese Communist Party, and eventually the leadership. Identifying  these useful  factional  agents is not a simple task, particularly when faced  with a DPRK system that is not transparent, which has gone far  in fusing  the definitions  of  "regime" and "civil society," and which may intentionally conceal factional  divisions to the outside. Successful identification  of  factions,  though, may help the source offload  much of  the burden of  offering incentives and structuring assurances. As described earlier, this is the point at which Moon has suggested that spontaneous, organic reform  takes place within the target state: internal actors accrue incentive to influence  state policy in ways that are cooperative vis-a-vis engaging powers.35 Snyder has noted that even GRIT engagement, for  all its emphasis on technical and measurable gains, has been largely buffered  in the Korean engagement process through low-cost, symbolic and emotional cooperation intended to ease the psychological bias of  mistrust. He warns that these types of  cultural exchange, cooperative sporting events, exchanges in arts and music, family  reunions, and civil society track-II channels etc. have been mistaken by some as tangible evidence of  successful  cooperation. "It is inevitable that symbolism and emotion must give way to the difficult  process of  institutional adjustments designed to foster  and in turn reflect  reduced tensions on the Korean Peninsula."36 The fa£ade  of  mutual harmony, then, cannot be considered an example of  successful  engagement until such harmony is actually a natural outgrowth of  engagement progress in political, economic, and security arenas. I argue that the value of  symbolic cultural exchange is worthwhile, even before  "actual" institutionalized cooperation, as such channels enable the development of  a cooperative discourse within civil society. As peoples' expectations change, and cultural symbolic acts become incorporated into mutual perceptions that become less antagonistic, public support for  "peace" and "cultural 3 5 Moon (2002), p 32 3 6 Snyder (2003), p 35 (emphasis added) solidarity" creates pressures on the leadership to continue with the process. This is true in both target and source state: even cultural engagement sources, who aspire primarily to export new norms to the target, will end up constricting themselves by such norms, as the source's own public accrues a cooperative identity. Ameliorating negative cognitive biases is a process that affects  both target and source perceptions, as domestic audiences on both sides begin to expect better cooperation. The Korean Engagement Advantage: Inter-State, Intra-National This phenomenon, though, is more likely to hold in cases of  engagement between divided nations, as the concept of  developing a common culture is feasible  here. The construction of confidence-building  measures in symbolic ways, in the Korean example especially, has been designed to address the very problem of  "promises as threats." If  material promises and diplomatic and political integration into the international community can be construed as a possible "threat" in the DPRK (given the potential erosion of  ideational integrity, political control of  domestic affairs,  and regime stability), then symbolic engagement between two adversaries can take form  in ways that enhance what the target fears  losing. This is the particular advantage the engagement process has in the inter-Korean context: both North and South Korea share a common ethnic, linguistic, and political history, and thus symbolic overtures which enhance nationalistic identity can allow the target regime to accept the material gains while also matching the process to its ideational endowment. The DPRK's fierce  sense of  Korean independence is observably Peninsular in nature, with nationalism inclusive of  both Korean states.37 While the Peninsular nature of  North Korean nationalism has worried engagement skeptics, who see expansionist designs in Pyongyang to forcibly  take over the South,38 this same type of  nationalism has also encouraged engagement supporters, who see an avenue for  the South to deal with the North in such a way that material promises do not completely corrode DPRK ideational 3 7 North Korean media increasingly takes pains to distinguish between the two contemporary Korean states and the Korean "nation," as exemplified  in a New Year's Day editorial published by DPRK journal Rodong Sinmun  this year: "The North and the South must take practical actions to solve the standoff  between the Korean nation and the U.S." Rodong  Sinmun  (Jan. 1, 2004) 3 8 See Nicholas Eberstadt, The End of  North Korea. (AEI Press, 1999), pp 120-23 integrity, nor directly challenge the ethnic-nationalist precepts upon which the North Korean regime seeks domestic policy support. Particularly given North Korea's strong sense of  external threat and historical trauma vis-a-vis foreign  powers, Pyongyang's negative cognitive biases are directed to Seoul only insofar  as the ROK is seen as subservient to foreign  powers such as the U.S. As Seoul seeks to demonstrate a cultural "solidarity" with the North, however, these biases may see corrosion that is only possible in the intra-national Korean context. Neither China, the U.S., nor Japan is capable of engaging the DPRK through such channels. Conclusions What we have seen here are possible forms  that a successful  engagement process can take, and under what conditions such a process is feasible.  The contemporary engagement literature suffers  from  an almost exclusive emphasis on the perspective of  the source state in initiating engagement, and possible source responses to target reactions. As useful  as the Literature is in identifying  opportunities for  engagement, there is a need to better understand how targets react to engagement overtures, why they may be prone to interpret promises as threats, and by what rationale targets determine a domain of  losses versus a domain of  gains. Within a target state's endowment, how do targets balance their need for  material concessions and political recognition with ideational prerogatives and the bases of  regime legitimacy? Sources that assume the absolute nature of  a potential promise or "gain" will be frustrated  by an inconsistent and apparently illogical continuation of  a negative cognitive bias within the target state. Particularly within a GRIT approach (as pragmatic as it may be when dealing with isolated targets in institutional virtual vacuums), targets may be prone to expressing satisfaction  with one channel of  engagement while expressing belligerence and risk-acceptant dissatisfaction  across other channels. This imbalance is no accident, but rather a way in which a target can balance certain types of  "gains" against certain types of  "losses," as they are perceived by various intra-target agents. Correcting this imbalance requires consideration of  relative perspectives of  gains and losses, and to what lengths targets are willing to go in order to protect what they perceive as their endowment, or to rein in a steady outflow  of  perceived losses. C II A P T Ii R T I I R E Ii The DPRK as a Target: Implications for  Engagement In the previous chapter, utilizing Schweller's typology of  possible types of  dissatisfied  states, I asserted that 1) revolutionary, expansionist types do not make logical targets of  engagement, since their goals are precisely  to consume new gains en route to upsetting the international order. Such states are actually rare in history, compared with limited-aims revisionists. These types of  states are not motivated by new gains (by what they covet), but instead, are driven to act because of  increasing losses in the status quo. It is the latter type of  state that is best engaged, as its actions are more a cause of  vulnerability than of  desire to reverse any hegemonic order. Also through Schweller, I argued that 2) risk-acceptant states demonstrate their place in a domain of  losses. It is'the poor and weak state, with the status quo delivering increasing losses, that is most prone to dangerous behaviour. As this state is driven by losses, though, it may also be satisfied  when the status quo yields gains, or when it develops a stake in the stability of  the system. Thus, engagement that goes beyond simply delivering aid, and instead establishes stable economic and political links, gives the weak state strength while also giving it reason to refrain  from  pursuing destabilizing types of  activity. The DPRK fits  quite neatly into both of  these categories, as will be analyzed below. Firstly, North Korea has demonstrated itself  as a limited-aims revisionist state through 1) proclaimed goals and ambitions that are largely tethered to affairs  on the Korean Peninsula and to the perceived status of  Korean sovereignty, 2) a nationalist ideology, not an internationalist revolutionary ideology, that demonstrates the actual basis of  regime legitimacy. Instead of  any sense of  communist internationalism or expansionist, revolutionary socialist principles, as was the case with Soviet or Chinese regimes, the North Korean regime has consistently legitimized itself  on nationalist principles that do not include expansion. Resistance to outside powers, not domination over outside powers, marks the political identity of  the leadership and its policy. Finally, 3) even if  the DPRK were interested in the prospect of  expansion, they do not have nearly the capacity to pursue any revolutionary aims. While Pyongyang's massive armed forces  and drive towards nuclearization may convince some outside observers that the "hermit kingdom" is interested in expanding, these military measures are best seen as deterrents against invasion, or "deterrents" against the South Korea/U.S. deterrents (in case the U.S./ROK deterrent was mobilized to become aggressive). At that, North Korea's mill tan,' machine is the product of  both a normal security dilemma between uncommunicative and mutually suspicious states, and a guerrilla ideology that spiritualizes a sense of total sovereignty. Instead of  planning for  expansion, even into the south of  the Peninsula,1 the DPRK actively and continuously forms  policy based on deterring external forces  from  impinging on its sovereignty. All the same, the military initiative that comes from  such policy is still not strong enough to successfully  expand, or alter the international status quo and the distribution of  power in significant  ways. Secondly, I will argue what is, in many ways, an uncomplicated argument: that the DPRK is highly risk-acceptant. This will be proven two ways: 1) the state's place in a domain of  increasing material losses over many years, brought on through economic collapse, humanitarian disaster, general communist state mismanagement, and a regional geopolitical environment hostile to the DPRK overall. With economic, political, and military indicators falling  throughout the 1990s and into the new century, Pyongyang has seen litde reason to abet the status quo, and has gone to great lengths to attempt to coerce external parties to the bargaining table in effort  to reverse a continuing flow  of  losses. Also, 2) as explored in the previous chapter, negative cognitive biases have led to high threat perceptions among the North Korean leadership, causing them to deduce external threat in various 1 This is not an uncontroversial point, and will be explored at greater depth as this argument progresses. Indeed, the very formation  of  the DPRK in 1947 was seen by the country's founders  as one step towards reclamation of  the entire Korean Peninsula, and much North Korean policy history is a long legacy of  war-gaming and developing contingency plans to forcibly  render the Seoul government void and to communize the whole of  the Korean nation. These ambitions, though, have been overplayed by many skeptics of  DPRK behaviour, as Pyongyang has admitted publicly (and planned accordingly) that taking over the South is simply unfeasible,  and has been for  many years. non-threatening circumstances. Even "promises" have been interpreted as threats, leading to a miscalculation of  status, and a proclivity to risk-taking that may seem irrational. Finally, 3) not unrelated to the second point, North Korean leadership places paramount emphasis on its own survival and the maintenance of  regime legitimacy. This legitimacy is not entirely (or even mostly) tied to the regime's ability to provide for  citizens' material welfare  — indeed, this aspect of  statecraft,  however essential in the liberal West, has been the regime's clearest failure.  By exploring relative interpretations of  gains and losses, though, it will be seen that "face-saving,"  the perception of  sovereignty, and the integrity of  national identity are immensely valuable political goods in North Korea. Even when engagement sources offer  generous material incentives to the North Korean target, Pyongyang may still remain prepared to act dangerously and riskily should these political goods become threatened. Ironically, it is the induction of  capitalist-minded engagement promises that direcdy threaten  these political goods, and incur more risk-acceptant behaviour in the security sphere. Paradoxically, engagement may beget belligerence, hence the continued need for  a containment/deterrence component to any strategy dealing with Pyongyang. Through the latter part of  this chapter, I will examine the usefulness  of  a GRIT approach to engagement of  the DPRK, as opposed to a comprehensive approach, with the view that it is "deterrence/GRIT engagement," and not "engagement through strength" (i.e. comprehensive) that is most applicable. This conclusion is made keeping the South Korean approach closely in mind. As Seoul's favoured  engagement tool is modelled after  GRIT, as will be explored, what have Pyongyang's reactions been? How are these reactions a function  of  Pyongyang's place in Schweller's typology, and how much are they a function  of  engagement vis-a-vis another Korean  state? This intra-national dynamic fundamentally  alters the nature of  cognitive bias, and changes the nature of  various nationalist political goods in Pyongyang. To begin with identifying  the DPRK as a limited-aims revisionist (LAR), risk-acceptant type, we will first  examine the indicators that characterize LAR states (identity, historical legacy, proclaimed and pursued goals, and capacity/incapacity for  expansion) before  examining the indicators that characterize risk-acceptant types (within a domain of  losses, the nature of  these losses, and threat perception). Figure  3.1: The  DPRK  as a Umited-Aims  Revisionist, Risk-Acceptant  State Umited-Aims  Revisionist  Characteristics Identity, History Self-reliant  ideology; nationalist; historical trauma vis-a-vis war with external powers Proclaimed Goals Korean unification;  sovereignty; regime survival Capacity for  Expansion Low: dwindling resources; no defense  alliances Risk-Acceptant  Characteristics Domain of  Losses High economic, humanitarian losses; diminished sphere of allies Threat Perception High: suspicious of  external powers, fear  of  vulnerability In the above table, I have identified  key goods that will most impact calculations by limited-aims revisionist, risk-acceptant states (identity/history, proclaimed goals, capacity for  expansion, domain of  losses, and threat perception), and have highlighted how these goods are manifest  in the DPRK. Below, I will estimate whether the value placed on each good is likely to elicit a cooperative or a resistant  posture from  Pyongyang when faced  with inter-Korean engagement overtures. Identity: Hegemonic Nationalism or Nationalist Isolationism? Resistance to outside control is one of  the most enduring hallmarks of  historical Korean identity, and the theme has been re-appropriated by the North Korean leadership in its construction of  the country's contemporary political identity. Snyder has observed that "survival, endurance, and resistance against foreign  forces  who seek to dominate or subjugate the Korean people are recurrent historical themes" that extend as far  into his ton* as Chinese Tang invasions in the 7 t h Century.2 While DPRK militarism in the 20 th and 21st centuries may be alarming, potentially destabilizing, and contributive towards regional security dilemmas, the role of  a powerful  military elite in Korea has traditionally been a function  of  resistance against external forces  which have attempted to force themselves onto the Peninsula.3 We can understand North Korea's culture of  national resistance as supported today through four  principal pillars of  political identity: 1) neo-Confucian  norms, 2) the guerrilla tradition embodied in the Kim family  legacy, 3) Juche ideology, and 4) socialist political structure. Neo-Confucianism  and  Filial  Nationalism "Confucianism"  is a broad philosophical hypothesis that generally focuses  on the cosmological, pseudo-religious tenets of  Confucius'  writings, which emphasize balance and harmony between cosmic actors and the elements. "Neo-Confucianism,"  as an applied sociological adaptation of  this, focuses  more on the political institutions (formal  and informal)  that govern public and private behaviour in accordance with sustaining this sense of  balance in human affairs.  We find  here the advancement of  both the "group identity," in which individualism is submerged beneath the ambition of  the entire polity, and also clear status distinctions between members of  the group. With a "seamless web of  interpersonal relations" in which no distinction is made between art, culture, and political spheres,4 an emphasis on filial  piety is expanded to the point at which no real distinction is made between a nuclear family  and the greater civil family  that constitutes the polity. The role of  ruler as "father"  cuts short the distance between the sovereign and his subjects, 2 Snyder (1999), p 18 3 Alexandre Mansourov, "A Neutral Democratic People's Republic of  Korea? Historical Background, Rationale, and Prospects," in Akaha (2002), p 50 4 Donald Stone Macdonald and Donald N. Clark, The Koreans: Contemporary Politics and Society. (3d ed.; Westview Press, 1996), p 80 tying both into a filial  relationship bound by blood and duty. Indeed, the role of  the "father"  (both literally and figuratively)  was to encourageju-ilsasang,  or "monolithic thought," in the group.5 Gilbert Rozman has noted that in the 20 th Century, these values "did not just disappear; remnants remain at the micro-level of  family  and community, the intermediate tier of  the education system and business enterprises, and the macro-level of  the state and its guiding thought."6 It is this macro-level effect  that is immediately evident in the North Korean political structure, with a new take on paternalism "aimed at creating a community willing to sacrifice." 7 The DPRK's sense of  national "self-reliance"  was fostered  by empowering the state and emphasizing the role of  the military in defense  of  the nation. This institution, though, also performed the task of  maintaining a pre-industrial police state that incorporated widespread slave labour into the rudimentary economic system,8 and clamped down on factional  elements that proposed reforms  or the opening of  the country along the lines of  the eventual Meiji Restoration as seen in Japan. This has helped to influence  an opaque political system that suppresses factionalism,  fuses  the governing and the governed into a common regime system, and largely defies  close outside scrutiny. The traditionally competitive security landscape of  Northeast Asia drove Joseon (Chosun) Dynastic Korea to augment these neo-Confucian  tenets with a particularly powerful  political conservatism, even primordial authoritarianism, in aim of  unifying  the society against adventurous neighbours. This complicates the task for  external actors to correcdy identify  specific  factions  within the leadership, although the faction  that advantages most clearly by any propagation of  "filial"  regime legitimacy is the Kim family  itself.  Through sustaining a neo-Confucianlist,  Joseon-dynastic ideational program, Kim Jong II asserts himself  as essentially unrivalled in any contest for  leadership. 5 Lome Craner, U.S. Assistant Secretary Human Rights, Democracy, and Labour. From text "Human Rights in the Democratic People's Republic of  Korea," delivered to Congressional Human Rights Caucus (Apr. 17, 2002), <http://usembassy.state.gov/tokyo/wwwhsel352.html> 6 Gilbert Rozman, "Can Confucianism  Survive in an Age of  Universalism and Globalization?" Pacific  Affairs 75:1 (Spring 2002), p 13 7 Ibid, p 14 8 James B. Palais, Confucian  Statecraft  and Korean Institutions: Yu Hvongwon and the Late Toseon Dynasty. (University of  Washington Press, 1996), p 14 Guerilla  Dynamics,  Militarism,  and  War  Identity Neighbours, however, would remain adventurous. The Japanese occupation of  Korea (1910-1945) effectively  animated the ancient national nightmare of  foreign  domination, legitimizing long-held fears  that Korean political cultural values were under siege. Resistance to occupation developed quickly: yet, partly because of  the northern half  of  the Peninsula's proximity to Communist resistance fighters  in China, Korean guerrilla resisters were better established, enjoyed access to illicit arms trading, and were overall more common in the North and into Manchuria.'-1 By 1937, a young Kim II Sung was commanding his own guerrilla unit within a militia called the Northeast Anti-Japanese United Army (NEAJUA), and he had quickly become infamous  as "the most feared  guerrilla leader in Manchuria."10 This was significant,  considering that over two million Koreans had fled  the Peninsula for  Manchuria during the 1930s, and that an estimated 95% of  them were "anti-Japanese." Indeed, Manchuria at this time was considered to have "more villages made up of  outlaws than any other place in the world."11 Fighting against advancing Japanese troops for  the entirety of  1937 and 1938 (and also against ethnic-Korean Japanese collaborators, including future  South Korean president Park Chung Hee), Kim and the NEAJUA enjoyed the massive support of  the large Korean refugee  community who looked up to Kim as a hero and, already, as a kind of  Korean saviour. The idolization of  his nationalist warrior personality grew congruently with a Japanese occupation that pursued the burning of  villages, "brutal torture [...] and bacteriological warfare." 12 While access to Communist guerilla resources helped northern Koreans develop a culture of  armed resistance, it is interesting to note that the south of  the Peninsula was concurrently much more heavily influenced  than the north by a religious movement known as the Jeondogyo. Jeondogyo, an unlikely outgrowth of  conservatism, Confucianism,  Buddhism, and agrarian peasant enlightenment, urged "passive reform,"  petitioning the government for  change as opposed to armed rebellion, and advocated collaboration with established powers. This may have helped to motivate "nonviolent rebellion" against Japanese occupiers in the southern half  of  the Peninsula, as indeed, many Japanese collaborators were native to the south and were thus installed in key bureaucratic colonial positions in Gaeseong. See Benjamin B. Weens, Reform.  Rebellion, and the Heavenly Way. (University of  Arizona Press, 1964), p 76-7 1,1 Bruce Cumings, North Korea: Another Country. (The New Press, 2004), p 108 11 Charles Armstrong, The North Korean Revolution: 1945 - 1950. (Cornell University Press, 2003), p 19 1 2 Cumings (2004), p 123-124 The Korean War, which followed  Japanese occupation, was also a brutish campaign in which the Communist North Koreans (and, eventually, Chinese) continued fighting  largely according to guerrilla tactics, and in which the U.S.-led counterattack was more than eager to demonstrate their powerful  new offensive  technologies. The nascent DPRK was threatened with nuclear bombardment more than once: General MacArthur made repeated unsuccessful  requests to President Truman to have upwards of  30 atomic bombs delivered to various ground-zeroes across northern Korea.13 Carter Eckert has noted "virtually the whole population worked and Lived in artificial  underground caves," in hiding from  American planes, "any one of  which, from  the North Korean perspective, might have been carrying an atomic bomb."14 North Koreans engaged in massive bunker construction and incredible tunnel networks (up to 1,250 km of  them) as means of  emergency refuge. 15 While atomic weapons were never used, the underground installations were not useless, as the massive air campaign used non-nuclear "novel weapons" quite liberally. By August 1950, the UN forces  were dropping 800 tons of  bombs per day. In the summer of  1950, an estimated 866,914 gallons of  napalm was fired  across North Korean villages, cities, and foresdand.  Allied orders were to pursue a scorched earth policy by which "every installation, factory,  city and village" would be levelled and burned.16 Once the DPRK was constituted, it was natural that "[t]he (Korean Workers Party) Central Committee was dominated by revolutionaries who had had military experience as anti-Japanese guerrilla activists. Most of  them commanded military forces  during the Korean War."17 Beyond the military dominance in domestic policy and in the political-institutional arena, the social-cultural arena was being cultivated by the military at the same time. Sociologist Helen-Louise Hunter has observed that, "[i]n a country that has traditionally liked to place categories of  people in neat rankings within 1 3 MacArthur archives, cited in Cumings (2004), p 22 14 Carter Eckert, cited in Selig S. Harrison, Korean Endgame: A Strategy for  Reunification  and U.S. Disengagement. (Century Foundation, 2002), p 9 1 5 Memoirs of  a Chinese Marshal: the Autobiographical Notes of  Peng Dehuai (1898 - 1974). (Beijing Foreign Languages Press, 1984), p 479 1 6 Cumings (2004), p 22 17 Kong Dongsung, "North Korea," in The Political Role of  the Military: An International Handbook (ed. C. P. Danopoulos and C. Watson: Greenwood Press, 1996) p 327 the society, the military ranks high in North Korea."18 In a modern Confucian  system with guerrilla revolutionary legitimacy, having good songbun (ancestral caste) is predicated on having had a father  or grandfather  advance through the military ranks or, better yet, take part in the anti-Japanese struggle.19 Thus, North Korean military elites benefited  by nourishing a sense of  noble songbun based upon respect for  the revolution, and this was inculcated from  an early age. Military spirit and training are imbued into the education system "from  kindergarten to high school,"2" with all male students prepared for  military exams as teenagers. The political role of  the military has thus been significant, and the war identity inherited through occupation and division has persisted in informing  strong negative cognitive biases towards outside powers and high threat perceptions. Evidence of  the KPA's dominance as a political faction  became evident during the 1990s. Kim Jong II was vaulted through the KPA hierarchy as a marshal, and was soon after  named Chairman of  the Defense  Commission, despite having no specific  military training. The Defense Commission was previously subordinate to the Central People's Committee, a state organ largely controlled by the KWP. However, the Defense  Commission came to separate itself  from  the assembly in 1990, becoming an equally powerful  legislative agent within the government. After  the death of  Kim II Sung in 1994, a constitutional amendment named the elder Kim "eternal president," essentially burying the highest office  in the land along with him. In order for  Kim Jong II to legally inherit the reigns of  power, then, the Defense  Commission abolished the CPC altogether in 1998, making Chairman of  the Defense  Commission the highest official  posting in the DPRK, and consolidating military supremacy over the political workings of  the state.21 Although there had been no coup, and the transfer  of  power to Kim Jong II occurred even more smoothly than widely expected among international observers, the death of  Kim II Sung allowed for  the completion of  a 18 Helen-Louise Hunter, Kim Il-song's North Korea. (Praeger Publishers, 1999), p 84 1 9 Indeed, Kim II Sung helped to reinvigorate the songbun system by propagating his own great-grandfather  as the "leader" of  a popular Korean revolt against an American military vessel near Pyongyang in 1866 - the notorious General Sherman  incident. See Snyder (1999), p 32 2(1 Kong (1996), p 334 2 1 Joseph S. Bermudez, Shield of  the Great Leader: The Armed Forces of  North Korea. (Allen and Unwin, 2001), p 22 total transfer  of  power from  Party apparatchiks to army elites, with the Defense  Commission now "controlling all of  the political, military, and economic capabilities of  the Republic."22 As the military has commanded up to 30% of  North Korea's annual GNP,2 3 it has been natural that the KPA has reached into the lives of  nearly all North Korean citizens. Since every family  has someone involved in the military, this "adds a personal dimension to the close feeling between the military and the population," in addition to the fact  that they help out on the farms, perform  development projects, and very rarely harm the population — at least not in ways that are out of  step with political convention. "The population is well aware of  the debt it owes the military."24 Juche  and  North  Korean  Ideology Through Kim II Sung's Juche (roughly "self-reliant")  philosophy, crafted  in the 1950s and '60s, the DPRK utilized indigenous cultural traits to supplant Marxist ideational dynamics with increasingly Joseon-modeled dynamics. Juche insists upon the awakening of  the national consciousness, as opposed to the class consciousness, requiring that each "individual submerge (his/her) separate identities into the collective subjectivity of  the Korean nation."25 While this collective consciousness may mesh well with Communist systems, the impetus behind the Korean collectivity had been sourced from  the start in a very different  place than pure Marxists might tolerate: ethnicity, xenophobia, and the worship of  the national will incarnate in the highest, most untouchable nobleman. As a result, this indicates that North Korean economic philosophy is relatively uncommitted to pure Marxist principles, which is encouraging for  capitalist engagers in the ROK and abroad. However, the strict hierarchical "royal" dynastic system that Juche prescribes is also resistant to the emergence of  lateral social interaction — such interaction is a natural byproduct of market economics. 2 2 Chong Bong-Uk, "Military Rule in Full Swing," Vantage  Point 22:4 (Apr. 1999), p 6 2 3 Peter Hayes, "Hanging in the Balance: North-South Military Capabilities," Nautilus Institute document (1994), <http://www.nautilus.org/DPRKbriefingbook/military/Hayes.html > 2 4 Hunter (1999), p 84 2 5 Armstrong (1998), p 36 Suh catalogues three principle tenets ofJuche  in regards to the status of  the Korean nation in the world stand out as: 1) political independence, 2) economic self-sustenance,  and 3) national self-defense. 26 Other scholars elaborate on this definition,  finding  in Juche "nationalism, economic self-subsistence, self-defense,  and a closed or contained social system."27 The absence of  Marxist teachings within this framework  is telling, with no mention of  any equitable distribution of  capital, nor the necessity for  society to overcome material barriers to social justice. As in the Joseon system, the DPRK through Juche enforces  and nourishes a "quasi-religious culture" and pushes forth  the "pervasiveness of  spiritualism in the mass belief  system,"28 which has gone far  in giving the leadership its semblance of  legitimacy despite a closed system without high material standards of living. This reflects  a cult of  personality that is invigorated by theocratic tendencies inherited through a conservative neo-Confucianist  political discourse. This spiritualization of  filial  leadership has secured the position of  Kim II Sung's son, Kim Jong II, in upholding a royal dynastic lineage as the basis of  the leadership. As Mansourov has observed, the modern Kim cult combines the images of  neo-Confucian  familism,  especially the virtue of  filial  piety and ancestor worship, psychological chords of  quasi-supernatural matriarchal shamanism, buttressed by the elements of  Japanese emperor worship and overtones of  evangelical Protestant Christianity, dressed in Stalinist garb and charismatic anti-colonial nationalism.29 Juche mandates a sense of  "total sovereignty," whereby even elements of  dependence on external powers through normal interstate transactions are framed  as losses in sovereignty. This is problematic for  the engagement process in the sense that the establishment of  external links thus animates extreme fears  of  vulnerability, which are inherent in dependency theory. For example, Kim II Sung responded carelessly to Beijing's criticism of  the DPRK's dramatic cult of  personality in 1968 2 6 Suh Dae Suk, Leadership and Political Culture in Korea. (Yonsei University Press, 2000), p 37 2 7 Han S.' Park, "Human Needs, Human Rights, and Regime Legitimacy: The North Korean Anomaly," in Moon (1998), p 228 2 8 Ibid, p 231 2 9 Alexandre Mansourov, "Korean Monarch Kim Jong II: Technocrat Ruler of  the Hermit Kingdom Facing the Challenge of  Modernity," Nautilus Institute document, <http://www.nautilus.org/DPRKbriefingbook/negotiating/issue.html > by asserting that "Korea will never again dance to the tune of  others,"3" signaling a devil-may-care approach to formulating  policy mindful  of  foreign  opinion, even when offered  by allies. While Kim may have built the nation largely through an ideology intimately associated with the sustenance of  his role as the national, spiritualized father  figure,  the precepts of  Juche have managed to flourish  beyond his death, as the urgency of  its message still holds salience for  many North Korean people: "political self-determination  and freedom  from  outside control."31 Juche propagandists continue to hammer home this message, and as South Korean scholar Suh Dae Suk notes, it is what "keeps the people marching even when they are in distress."32 If  Juche propagandists within the DPRK find  themselves tied to any particular faction,  it is the Korean Worker's Party. In conceiving of  the KWP as a faction  distinct from  the Kim family  itself and from  the KPA, it has become clear that the Party has lost political ground in recent years, as illustrated above through the rise in military-political authority, and in the difficulty  that the KWP has in managing a complex ideational rationale that balances "total sovereignty" against pragmatic needs for  reform.  Much of  the Juche philosophy is already contingent on the pre-eminence of  the military and on the legitimacy of  dynastic rule, thus in terms of  domestic identity, we can see the KWP as increasingly submerged beneath the two faction  explored above. Socialist  Administrative  Structure While Soviet socialist influences  certainly played a role in creating bureaucratic templates in the DPRK, there is a tendency for  them to be overemphasized. Adrian Buzo has argued that Kim II Sung utilized prototypically Stalinist institutions in the process of  North Korean statecraft,  given that Kim's authority derived from  Soviet support as early as the guerrilla campaigns.33 Suh has countered that Kim himself  was never primarily driven by Communist or socialist precepts, but by anti-Japanese, nationalist precepts. The Soviet support he solicited was ultimately a means to this greater end. Kim's guerrilla history was one spent "outside the mainstream of  the Korean Communist 311 Suh (2000), p 43 3 1 Armstrong (1998), p 33 3 2 Suh (2000), pp 10-11 3 3 Adrian Buzo, The Guerilla Dynasty: Politics and Leadership in North Korea. (Westview Press, 1999), p 238 movement," with most of  his energy spent corralling the support of  resistance fighters  as diverse as Chiang Kai Chek's Chinese Nationalists, the Chinese Communists, the NEAJUA, and the Soviets.34 Andrei Lankov has argued that, as early as the 1950s, the Soviet identity in the DPRK began to be deliberately dismantled, socialist propaganda supplanted by Juche propaganda, and communist internationalism replaced by introspective nationalism — Juche philosophy was itself  introduced to North Koreans in 1955 with a speech by Kim II Sung tided "On the Uprooting of  Dogmatism and Formalism in Ideological Work and the Establishing of  Ch'uche."35 According to Lankov, "the changes found  their expression in (...) an emphasis on the superiority of  all things Korean over all things foreign." 36 Even elements of  Soviet political structure that remained intact in Pyongyang were soon recast as "indigenous."37 We can readily observe elements of  Joseon-era dynamics coming to play: the spiritualization of  respect and obedience goes beyond what is found  in non-Confucianized  societies such as the European communist nations, with "camaraderie" in Korea coming to embody a perception of divine mission. The anti-imperialist struggle itself,  with Kim II Sung as the Joseon-esque father  figure, served to articulate all the old qualities of  celestial leadership. The "relative success of  individuals who have blood ties to Kim II Sung and Kim Jong II, or those who have revolutionary credentials or relationships to the 'first  family'  reinforces  the perception that an essentially traditional social structure (...) remains a fundamental  aspect of  North Korean social organization."38 Identity and Implications for  Engagement: Mixed Response North Korean regime identity can thus be characterized as 1) emphasizing total sovereignty, self-reliance,  and distance from  outside powers, 2) powerfully  nationalist and ethnocentric, and 3) traumatized through negative historical legacies incurred through invasion, occupation, war, and continued threat of  war. These conditions foretell  a mixed diagnosis for  an engagement strategy, with 3 4 Suh Dae Sook, Documents of  Korean Communism 1918-48. (Princeton University Press, 1970), p 429-30 3 5 Andrei Lankov, From Stalin to Kim II Sung: The Formation of  North Korea 1945-1960. (Hurst and Company, 2002), p 67 3 6 Ibid 3 7 Ibid 3 8 Ibid, p 33 a bias towards resistance against engagement. Resistance comes as 1) any engagement process is an overt attempt by a source state to inculcate change in the target state and create dependencies upon which the target comes to rely. A self-reliant,  conservative propagandist discourse, upon which much regime legitimacy is based, is then starkly out of  step with engagement's change-oriented focus.  Also, 2) historical trauma incurred through war and powerful  mistrust of  foreign  powers has helped to mould negative cognitive biases, meaning that even engagement "promises" may be construed as "threats." Kim Dae Jung's "Sunshine Policy," according to Selig Harrison, has been seen in the DPRK as "an unabashed attempt to subvert (North Korea's) system, more dangerous than previous attempts because it was more subde (...) Similarly, the North believes that Kim (Dae Jung) has pushed for  the reunion of  separated families  not for  humanitarian reasons but to sow discontent by showing off  the affluence  of  the reunited family  members who live in the South."39 North Korea's pan-Korean, nationalist identity also encourages engagement that is sourced in the ROK: thus, it is intra-national. Although Pyongyang may be suspicious of  the leadership in Seoul, there is much less psychological resistance to accepting increased cooperation with another Korean power, thus avoiding the identity crisis inherent in developing dependency on external powers that are also external to the Korean nation.4" The DPRK is able to frame  the ROK's nationalist overtures in pursuing inter-Korean cooperation as consistent with North Korean desires, simplifying  the task of  justifying  economic reforms  within the rubric of  Juche and political conservatism. As seen, nationalist principles are more salient than strictiy socialist principles in the North Korean identity — although socialist structure is still difficult  to change, it is changing in fact  and in form,  with Kim Jong II exhorting North Koreans to "abide by the principle of  profitability"  in the summer of  2004, reportedly praising workers at a light manufacturing  plant for  "intensifying  the ideological education among producers to thoroughly ensure profitability." 41 If  the uprooting of  dogmatic socialism can be achieved in the DPRK, it does 3 9 Harrison (2002), p 83 4 0 Ibid, p 73 4 1 "Kim Jong II gives field  guidance to Kusong Machine Tool Plant," Korean  Central  News  Agency (Jun. 1, 2004) so while remaining safely  under the umbrella of  dogmatic pan-Korean nationalism. Thus, while DPRK identity may make engagement difficult,  the process as per South Korea allows the Pyongyang regime some leeway in adapting its political identity to the greater nationalist objective. Proclaimed Goals: Sovereignty and Unification Beyond the securing of  material resources through international trade and development, the DPRK has sought to "defend  national sovereignty at almost any cost."42 Indeed, the cost has often been trade and development, leading to a state that seems to value domestic political goods more than international political goods or material goods. Are these goals irreconcilable with economic achievement? Kim Jong Il's proclamation that profitability  is now a nationalist virtue (echoing Deng Xiaoping's highly un-Maoist proclamation that to get rich was "glorious") suggests some flexibility on this front.  Pyongyang's maintains several key interests: 1) securing the economic wherewithal to survive, 2) maintaining territorial integrity and defending  against external threats, and 3) ultimately reuniting with the ROK (supposedly abolishing its own regime system in favour  of  a new federal Korean system). Contemporarily, neither North nor South Korea advocate rushing into a unified federal  system, as the ROK is unprepared to manage the enormous consequences of  economic and cultural shock that northerners would face,  and the DPRK is unprepared to enter into any unification arrangement from  a position of  weakness. The cultivation of  a nationalist identity would be sanctified  within a powerful  defense posture. Early DPRK proclamations aimed to reconstitute the broken post-war state by "arming all the populace (and) turning the entire country into a fortress." 43 The profoundly  nationalist discourse in the DPRK is not exclusively state-patriotic, but is pan-Korean, ethnic and nationalistic, which is thus inclusive of  the ROK. Harrison has interpreted this desire for  unification  to be a "defensive" desire,44 with Pyongyang aware of  its inability to "capture" the South militarily since at least the 4 2 Snyder (1999), p 145 4 3 Socialist Constitution of  the Democratic People's Republic of  Korea (revised 1998), Chapter 4, Art. 60 4 4 Harrison (2002), p 71 1980s. Ho Jong, Pyongyang's ambassador at large for  the Ministry of  Foreign Affairs,  communicated to U.S. officials  in the early 1990s that North Korean goals were to pursue peaceful  coexistence with the ROK, adding that pursuing unification  by force  was not a "realistic" option.45 While the original DPRK constitution proclaimed Seoul to be the dejure  capital of  the Communist regime (with Pyongyang seen to serve as an interim base), the constitution was revised in 1972, and stated that Pyongyang was indeed the de  facto  and de  jure capital of  the DPRK. Another clause indicated that the DPRK "strives to achieve the complete victory of  socialism in the northern half'  of  the Peninsula, while limiting its ambitions regarding the South to "drive out foreign  forces on a nationwide scale."46 This withdrawal of  peninsular communization specified  an early acceptance of  the ROK's legitimacy as a state, as well as the victory of  nationalism over communism in the DPRK's sense of  pan-Korean identity. By 1980, Pyongyang had largely abandoned proposals to unify  the Korean Peninsula into a unitary state, accepting overtures from  the South that a consociationalist-styled two-state confederal model would be more applicable. In 1991, Kim II Sung told Southern officials  that they were "ready to discuss vesting the autonomous regional governments of  the (proposed) confederal  republic with more rights," providing that the confederal  body would assume more powers in due time.47 By 1993, Pyongyang had issued its "Ten Point Program of  Great National Unity," which suggested a confederal  system with dual North-South sovereignty. Within the confederation,  "the North and South would be on equal footing,  which means that our proposal inherendy protects the autonomy of  both sides, while China retains ultimate sovereignty in the 'one country, two systems' approach."48 Within this platform,  there are admissions that any confederate  system would need to 4 5 Leon Sigal, Disarming Strangers: Nuclear Diplomacy with North Korea. (Princeton University Press, 1997), p 138-9 4 6 Socialist Constitution of  the Democratic People's Republic of  Korea 1998, Art. 9 4 7 Kim II Sung, cited in Harrison (2002), p 76 4 8 Kim Byong Hong, DPRK representative with Ministry of  Foreign Affairs,  cited in Harrison (2002), p 77 guarantee the right to private property and would need to do away with protectionist measures against foreign  investment.49 The fear  in Pyongyang is that, as the North has weakened and the South has become stronger over the course of  the past two decades, any infringement  upon national sovereignty in a confederate  unification  scenario would likely tilt towards Seoul's interests, leading to a unification  by absorption. Proclaimed Goals and Implications for  Engagement: Cooperative An engagement strategy that seeks to inculcate new norms of  inter-Korean cooperation, cultural exchanges (including family  exchanges, joint sport exercises and tournaments, and tourism) and economic cooperation in terms of  joint-venture enterprise and development aid, does not challenge the DPRK's proclaimed goals of  eventual unification  from  a position of  prosperity. Mindful  of  North Korea's public desire to enhance pan-Korean cultural identity, such engagement is possible without entirely threatening the strong sense of  sovereignty in Pyongyang, so long as "sovereignty" can be promoted as nationalist Peninsular sovereignty, not limited to state sovereignty. Furthermore, designs for  unification  made in Pyongyang have become progressively weaker as the state experiences a diminished capacity to cooperate with the ROK on an equal footing,  and as prospects of  regime survival within a two-state confederal  model are diminished for  Pyongyang. Through delivering economic engagement, Seoul reduces the threat perception of  "unification  by absorption," strengthening the DPRK's potential as an equal economic power. This act of "strengthening" the DPRK, though, provokes engagement skeptics to argue that this actually increases the capacity for  Pyongyang to initiate and sustain a conflict.  Mindful  of  this risk, an active engagement policy then necessarily comes in tandem with a strong deterrent posture that is necessary to dissuade Pyongyang from  attempting such would-be domination from  a position of  increased strength. 4 9 Ibid Han S. Park has argued that U.S. troops on the Korean Peninsula will always encourage a hostile DPRK policy,5" which would indicate that there may be a "revolutionary" nature to Pyongyang's goals (upsetting the U.S. hegemonic Pacific  defense  posture) as opposed to a "limited aims revisionist" posture. Yet, Pyongyang's demands for  U.S. troop movement off  the Peninsula are rooted more in national ambitions than in regional or international, systemic ambitions for  change. Even these proclamations may be flexible,  as Kim Jong II has suggested some rhetorical leeway on the U.S. troop presence, notable during the North-South Summit in 2000.51 While such apparent North Korean flexibility  has tended to oscillate, what remains unchanged is that the DPRK is concerned about the potential for  a U.S. attack. Security concerns, not a desire for  expansion, mark DPRK public policy in this arena. One must keep in mind that the U.S. is not North Korea's only perceived threat: fears  of  a surge in Japanese nationalism and an expanded role for  its armed forces,  along with fears  of  potential Chinese hegemony, contribute to North Korea's ultimate goal to safeguard  the sovereignty of  the Korean nation.52 This does not mean expansionism, but protectionism, and it is not the very existence of  a U.S. defense  posture in the region that threatens DPRK sovereignty, but a U.S. defense  posture that is perceived as hostile. Capacity: Revolutionary or Revisionist? The DPRK has made clear its position that the development of  nuclear weapons is not an offensive  tactic, but a deterrent against what it sees as external powers hoping to pursue regime change at a moment when the North Korean regime is particularly weak. In response to U.S. 5 0 Park (1998), p 102 5 1 Kim Jong Il's reported proclamation that U.S. troops should stay after  a unification  scenario may have been made to 1) simply promote goodwill during the summit itself,  and not signaling a wholesale change in DPRK foreign  policy, 2) voice a desire for  stability on the Peninsula, or 3) express strategic ambiguity. For a useful analysis of  the statement, see Nicholas Berry, "A Question in Search of  Answers: North Korea Sees U.S. Troops as Desirable?" Center for  Defense  Information  document (Sep. 6, 2000), <http://www.cdi.org/asia/btn090600.html>; also see Don Kirk, "A North Korean shift  on opposing U.S. troops?" International  Herald  Tribune  (Aug. 10, 2000) 5 2 Indeed, North and South Koreans alike remain "very cautious about Japanese behaviour." A poll conducted by South Korean newspaper JoongAng Ilbo in 1996 asked "whether a reunified  Korea should possess nuclear weapons as a means of  precaution against major powers in Asia" — 82.6% of  South Koreans at the time replied "yes." See Hiromichi Umebayashi, "Beyond Unilateral Bilateralism - Towards a Cooperative Security System in Northeast Asia," speech delivered to Pacific  Campaign for  Disarmament and Security Conference,  Seoul (Nov. 2, 2003) "bunker busting" nuclear arms technologies, Pyongyang reinforced  this position, arguing publicly that "the U.S. mass production of  smaller nukes would seriously harass peace, escalate military standoff  and increase the danger of  a nuclear war. Then those countries which do not possess those weapons will be compelled to take self-defensive  measures to cope with the nuclear threats."53 The U.S. Nuclear Posture Review Report in January 2002 also implied a nuclear first-strike  against North Korea in the event of  a DPRK invasion of  the South, even if  the North were to use conventional forces.  This has gone far  in animating DPRK threat perceptions.54 Also, Park has been right to note that "[b]ecause the development of  an adequate conventional weapons program requires a sound economic and technological base, North Korea realized that it was in a disadvantaged position in its competition with the South."55 As such, although the development of  nuclear weapons represents grave risk-acceptant behaviour in Pyongyang, it does not signal a plan of  attack. Instead, the unintended signal is that North Korea's military and economy are desperate while security fears remain pervasive, and the increasing domain of  losses has prompted Pyongyang to act dangerously. Furthermore, so long as Pyongyang encounters unmanageable costs in maintaining a conventional deterrent, a nuclear deterrent may serve as a cost-saving measure, allowing the conventional program to see cutbacks. DPRK conventional forces,  despite the high number of  soldiers (estimates of  over one million), are not as well-equipped nor as well funded  as their South Korean counterparts. With the ROK channeling over $15 billion into its defense  program in 1999, the DPRK was spending under $6 billion, despite the much higher percentage of  the North Korean total economy this represents.56 5 3 "U.S. moves to develop smaller nukes under fire,"  Korean  Central  News  Age/uy  (Nov. 11, 2003) 5 4 A spokesman for  the DPRK Foreign Ministry said that "in response to the present situation where nuclear lunatics have seized power of  the White House, we North Korea (sic) have no other option but to completely review all agreements we have made with the U.S." This event preceded the DPRK's "nuclear admission" in October 2002 by seven months. See the ROK National Intelligence Service, Overview of  Reunification  Issues: The (sic) 50 Years of  South-North Relations. (Mar. 13, 2002) <http://www.nis.go.kr/eng/ security/issue_index.html> 5 5 Park (2002), p 135 5 6 David Kang, ed., Nuclear North Korea: A Debate on Engagement Strategies. (Columbia University Press, 2003:1), p 50 With a relative deficit  in defense  funding  having stretched on since 1975,57 coupled with the U.S. deterrent posture that bolsters ROK defenses,  combined still with Pyongyang's  dwindled circle of military allies, the North's prospect of  winning any invasion of  the South is virtually nil.58 Capacity and Implications for  Engagement: Cooperative While a poor capacity to pursue revolutionary, systemic change may reinforce  the categorization of  the DPRK as a limited-aims revisionist power, how is engagement then more useful than deterrence in this circumstance? If  Pyongyang is effectively  paralyzed by its relatively modest ability to launch a sustainable attack and win territory, why bother "engaging" in the first  place? It is precisely this condition of  poverty and vulnerability that lead to risk-acceptant behaviour, and lash-out scenarios cannot be ruled out, if  not outright warfare. 59 Even though Kim Jong U may be aware that he cannot win a war with the ROK, or any other power, maintaining a credible threat will be necessary in negotiating from  a favourable  position. Furthermore, if  the domain of  losses continues, and international efforts  at engagement fade,  thus suffocating  any nascent efforts  at economic reform,  then threatening or executing a limited military strike, missile launch, or other type of  violent behaviour may be rational for  the DPRK, in that it elevates their bargaining position.60 This will be unfavourable,  however, as such moves risk generating more internal turmoil. Bandwagoning with expansionist powers may also be a way for  the DPRK to strengthen its bargaining position, although this too is unlikely as there are no observable potential contemporary powers with whom to bandwagon. As such, North Korea will prefer  to refrain  from  initiating any suicidal attack, so long as there are options (such as engagement) that offer  clearer returns. 57 Ibid 5 8 Some analysts have noted that Korean People's Army rhetoric still includes contingency planning for  a rapid takeover of  the ROK, and there is an enduring emphasis on the "single-hearted unity" of  North Korean soldiers as a tactical advantage over technically-advantaged, but morally weak, ROK and U.S. forces.  Despite the morale-boosting sentiment that it would be feasible  to defeat  "imperialist aggressors' challenges with our people's spirit," it would be highly unlikely that the KPA could prosecute and sustain any invasive warfare  on the Korean Peninsula "for  more than six months." See Bermudez (2001), p 19 5 9 Bermudez' analysis finds  that it would be "imprudent" to suggest the DPRK would be driven to launch outright war as a result of  continued suffering  in a domain of  losses: Bermudez (200f),  p 19. Cha, however, sees a loss-driven military strike, or intentionally increased military tension with neighbours and/or rivals, as likely moves from  a regime with little to no stake in a worsening status quo: Cha (2003), p 19 6 0 Cha (2003), p 86 Domain of  Losses: Economic, Humanitarian, Political With the DPRK's GNP collapsing from  $22.3 billion to $15 billion in the past eight years/'1 North Korea's closed economic system led to massive losses in food  production, health indicators, and environmental sustainability, with deforestation  and reclamation of  tidal lands deemed necessary to expand agricultural production. It is the state of  profound  environmental insecurity over the course of  the 1990s which has gained the DPRK some of  its most significant  attention (and widespread support), and in Pyongyang's  view, it is what justified  pleading to the wider international community for  food,  thus marking a unique opportunity to engage the regime at its own behest. Massive floods  brought on by typhoons in 1994 and 1995 delivered environmental destruction to several regions of  the DPRK. Through use of  Landsat Thematic Map data, a Japanese team has estimated that the floods  in 1995 had severely damaged roughly 300,000 million hectares of North Korea's paddy fields,  or 42% of  the rice-growing agricultural land in the country. For the western region of  the DPRK alone, 1995's rice production consequently totalled just 220,000 metric tons — a decline of  over 500,000 metric tons compared with 1987 levels/'2 According to the World Food Programme (WFP), overall cereal production declined by one quarter between 1995-96 and 1997-98, from  just over four  million tons, to 2,838,000 tons - this figure  dropped by another 300,000 tons by the year 2000/'3 This put the country into a cereal deficit  of  just under 2,500,000 tons in 1996, while food  aid coming into the country the same year didn't top 600,000 tons. Between 1995 and 2001, the amount of  food  aid has only ever managed to alleviate the annual deficit  by half,  with an average well below that/'4 The World Health Organization (WHO) also found  that "the DPRK 6 1 Balbina Hwang, "Curtailing North Korea's Illicit Activities," Heritage Foundation Report (Aug. 26, 2003) 6 2 K. Okamoto, S. Yamakawa, and H. Kawashima, "Estimation of  Flood Damage to Rice Production in North Korea in 1995," International  Journal  of  Remote  Sensing  19:2 (1998), pp 365—371 « DPRK Cereal Production (1995/96—2001/02), UN World Food Programme 6 4 DPRK Food Aid Compared with the Total Estimated Cereal Deficit  (1995—2001), UN World Food Programme faced  a 382,000 megaton food  shortage for  the period between July and October 2001" alone: this while the UN World Food Programme did not receive the amount of  food  aid it had called for/' 5 As serious as the typhoons may have been, much of  the resulting damage stemmed from inadequate financial  resources to respond, understaffed  hospitals with poor conditions, and an environment weakened through ideologically-conceived, dogmatically communist terraforming projects/'6 The ensuing drought was a combination of  damage incurred in these floods  and long-deteriorating economic and health indicators that were exaggerated in the 1990s through the absence of  Soviet aid, and a decline in relative Chinese support. During this period, it was said that "North Korea facefd]  the problem of  avoiding economic and environmental ruin and social collapse brought on by a food  and health-care crisis that [...] sharply reduced individual well-being."67 Eigil Sorensen, a leading representative with WHO's operations in the DPRK, found  that "the health care system has more or less collapsed," with a mortality rate increasing 40% since 1994 to 9.3 per 100/'8 Estimates of  deaths resulting from  famine since 1995 range from  500,000 to well over three million. Han S. Park puts the situation graphically, observing in 1998 that "the entire population is in the process of  slow death."69 Beyond the sheer human cost of  this insecurity avalanche is the economic toll, as individuals and communities are deeply affected  by a severe cut to productivity — the DPRK has seen its GDP reduced by over one 6 5 United Nations Office  for  the Co-ordination of  Humanitarian Affairs,  "DPR Korea Bulletin," < www.vuw.ac.nz/~caplabtb/dprk/Flood_Damage_l  0_0ctober_2001.pdf  > 6 6 During 1998 meetings of  the Agricultural Recovery and Environmental Protection (AREP), an international relief  consortium created to address the famine  situation, the DPRK admitted that its exhaustive agricultural policies have played a major role in transforming  the land for  the worse: "[FJarming in DPR Korea is necessarily land and input intensive. We have only 900 square meters of  farmland  per person, yet we attempt to meet all of  our food  grain needs (independently). Farming is necessarily intensive and undeniably puts great strains on the environment." This passage was included in a speech made by Choi Su Hon, DPRK Vice-Minister for  External Affairs,  to the Thematic Roundtable Meeting on Agricultural Recovery and Environmental Protection for  the DPRK, Geneva (May 28 - 29,1998) 67 Mel Gurtov, "Common Security in North Korea: Quest for  a New Paradigm in Inter-Korean Relations," Asian  Survey  42:3 (May/Jun. 2003), p 413 6 8 Bradley Babson and Kim Eun Sook, "Challenges in Expanding External Economic Relations with North Korea," World Bank study (May 12, 2000), at <http://wvvw.nautilus.org/papers/security/babspn_on_dprk_economic_relations.html > 6 9 Park (1998) p 223 half  between 1989 and 1998, thus slashing peoples' ability to generate the income that might help to avert continued deaths. Politically, the DPRK is clearly more isolated than it had ever been during times of  relative economic security. The absence of  Soviet political support (and the economic and military aid that had come with it) has combined with a more tepid alliance with China, as Beijing seeks to associate itself  with international institutions of  a global nature, requiring Chinese adherence to an array of geopolitical norms. DPRK isolationism is increasingly out of  step with Chinese eagerness to prove itself  a credible international partner, and the alliance has been strained by Beijing's cessation of  its common defense  posture vis-a-vis Pyongyang.  This places the DPRK in a desperate position in its drive to secure itself  in the international system. Domain of  Losses and Implications for  Engagement: Cooperative Losing unconditional Soviet and Chinese support has meant both economic and political loss.7" While economic losses motivate risk-acceptant behaviour in stemming the downward spiral into bankruptcy, can it be argued equally that political losses (such as a decline in allies' numbers or the level of  their commitment) also motivate risk-acceptant behaviour? How likely is it that an increasingly isolated regime will endeavour to take on dangerous action? While the prospect of  winning any war is certainly slim for  the DPRK, certainly without stalwart allies to back it up over the course of  any militarist adventures, neither is the DPRK dissuaded from  provocative action by extensive binding mechanisms that tie Pyongyang policy to that of  important allies (or to the international system as a whole). Snyder has noted that the DPRK's lack of  political ties to the international community engenders a willing abdication of  responsibility to adhere to international norms. This further  enables brinkmanship tactics and uncooperative negotiating behaviour.71 So long as the DPRK remains relatively "unbound," the only policy that can effectively  restrict its capacity for  expansion is a deterrent strategy. As seen, however, deterrence is not a political good for  the target, and neither does it bring the target out of  the material domain of 7 0 Kang (2003:1), p 57 7 1 Snyder (1999), pp 68-73 losses, which engagement seeks to do. With a status quo that is increasingly unsustainable, desperate behaviour in Pyongyang can only be truly mitigated through moving North Korea from  a domain of losses towards a domain of  gains over the course of  an engagement strategy. Political losses motivate bluffing,  brinkmanship tactics, and crisis diplomacy, and economic losses motivate following  through on bluffs,  potentially provoking genuine crisis. As seen, without proclaimed goals to expand, and without the capacity to engage in conflict,  Pyongyang then prefers  a strategy that allows its losses to diminish. In facing  a potential engager, the DPRK is left  with few  palatable options but to answer the call. Threat Perception: The DPRK's "Permanent Siege Mentality" One source of  friction  in answering this call enthusiastically is the pervasive sense of  mistrust that exists among DPRK decision makers and extremely high threat perceptions towards external powers. DPRK identity, the peninsular-nationalist nature of  its unification  goals, its capacity for actually waging war, and its significant  slide into a domain of  economic, humanitarian, and political losses, exacerbate a position of  incomplete nationhood, inability to correct this imbalance through conventional means, and fear  that material and political conditions can only worsen through a maintained status quo. Past experiences of  invasion, occupation and warfare  have been manipulated by the KPA and the Kim dynasty into a spiritualized manifesto  of  resistance, and the role of  the armed forces  in defending  against aggressive outsiders has come to inform  much of  the North Korean political culture.72 A diminishing capacity to pursue its eventual goals of  unifying  with the ROK on equal terms only heightens this sense of  vulnerability. Given the sense of  incomplete sovereignty in Korean nationhood, it is not South Korea itself  that is primarily seen as threatening in this regard, but principally the degree to which Washington influences  ROK policy, and the degree to which Japan is seen as having not completed its process of  apology or "compensation" for  past 7 2 An oft  performed  North Korean opera, P'ibada  ("Sea of  Blood"), follows  the story of  a Japanese massacre of Korean refugees  during the resistant in Manchuria. Through the play, "the Korean people realize that unless they help themselves, no country will come to rescue them at the risk of  their own national interest," speaking to the international community's overt endorsement of  Japanese colonial in its early forms.  See Park (2002), p 96 crimes committed through occupation. "To the North Koreans, there is no permanent ally or permanent enemy, but there will always be imperialist powers prepared to conquer smaller countries that are not capable of  self-defense." 73 Public proclamations towards Japan have oscillated between mild anxiety about Japanese security policy to distinctive paranoia: The Japanese aggressors had long set their eyes on and thrust their aggressive claws into Korea which is rich in gold, silver and other resources [...] 54 years have passed since the Japanese were defeated.  But Japan is still persistently resorting to the hostile policy against the DPRK instead of  apologizing for  its past crimes. No others are more maliciously trying to isolate and stifle  the DPRK than the Japanese reactionaries. They have defined  the DPRK as the first  target of  aggression as in the past and are stepping up their military preparations for  its realization. They have no intention to liquidate (sic) the past crimes but are hectic with the wild ambition for  reinvasion. Overseas expansion is the physiology of  Japanese militarism. If  it had not been for  the colonial rule of  the Japanese for  nearly half  a century, our people would not have suffered  from  national division. Japan is the sworn enemy of  our people in all ages. We will make Japan, the sworn enemy, pay for  all their misdeeds anytime.74 In a corresponding article, speaking to continued international concern over the Taepo-dong missile test, directed through Japanese airspace in 1998, an unnamed official  said: Clearly speaking, DPRK-Japan relations are relations between victims and assailants. The assailants are obliged to make (a) sincere apology and (provide) adequate compensation to the victims for  their past crimes. If  they refuse,  there is no need to talk about the future relations. This is precisely the essence of  the DPRK-Japan relations.75 Having designated the DPRK as the first  target of  their overseas aggression, the Japanese reactionaries are working hard to attain it.76 Regarding visits to the Yasukuni War Shrine by Japanese political leaders, North Korean media consistently goes farther  than their South Korean or Chinese counterparts in denouncing the visits. Rather than only seeing these visits as insensitive or insulting to the history of  occupation, DPRK perception focuses  on a supposed desire for  reinvasion implicit in the visits, thus perceiving them as renewed acts of  aggression: 7 3 Ibid, p 92 7 4 "Japan, sworn enemy," Korean  Central  News  Agency  (Oct. 16, 1999) 7 5 "Japan's insincere attitude denounced," Korean  Central  News  Agency  (Oct. 16,1999) 7 6 "Threat comes from  Japan," Korean  Central  news  Agency  (Jan. 4, 2004) (Japanese political leaders) seek to regularize, traditionalize and popularize the visit to the (Yasukuni) shrine, describing it as a token of  'people's sentiment.' This is aimed to implant militarism deep into the mind of  the Japanese people and thus build an ideological foundation  for  overseas aggression.77 The last two remarks are especially significant,  as they have come during attempted moves towards detente by the Japanese leadership. Prime Minister Junichiro Koizumi has paid two visits to Pyongyang since 2002, has apologized for  Japan's past crimes during the occupation, and has managed to solicit Kim Jong Il's admission that the DPRK was responsible for  a past covert abduction program in which several Japanese citizens were kidnapped and forced  into espionage activities.78 These developments are important for  the DPRK, as securing economic and political goods (investment and diplomatic recognition) from  Japan is consistent with North Korean aims towards reversing a domain of  losses. As is typical, however, the importance of  these channels for North Korea does not immediately subtract from  another important factor:  the maintenance of regime legitimacy, which is at least partially based on anti-Japanese, anti-imperialist sentiment. By continuing to release vitriolic anti-Japanese rhetoric through public media organs, Pyongyang balances its needs to 1) appear ideologically consistent at home and 2) appear as a willing (if  clumsy) target for  investment and prestige. As much as Japan is publicly denounced as not having sincerely expressed regret for  its occupation of  Korea, and in extreme commentary, that it plans a reinvasion, the U.S. is derided on an almost daily basis for  supposedly harbouring zealous ambitions for  nuclear warfare  against the DPRK,79 for  expressing "real earnest for  the second Korean war,"80 and for  standing against 7 7 "Japanese reactionaries under fire  for  justifying  their visits to Yasukuni Shrine," Korean  Central  News  Agency (Mar. 15, 2004) 7 8 It should be noted that this admission by Kim Jong II was likely made as an attempt to appear conciliatory and transparent, although Japanese reaction was understandably hostile. This type of  diplomatic inelegance reflects  Kim's own self-deferential  assertion that he "is not a diplomat." (See Mansourov, "Korean Monarch") 7 9 A self-titled  'detailed report' published domestically in Korean (but not in English) by the KCNA outlines nuclear ambitions on the Korean Peninsula, with a notable focus  on the Korean War period and the 1950s, ROK nuclear research in the 1970s under authoritarian leader Park Chung Hee, and joint U.S./ROK military exercises through the 1990s in preparation for  a nuclear contingency. See "KCNA Detailed Report," (translated from  Korean), published on Federation of  American Scientists homepage, <http://www. fas.org/nuke/guide/dprk/nuke/dprk051203.html> 8 0 "U.S. should not act rashly," Korean  Central  News  Agency  (Apr. 5, 2004) unification  processes engendered by sovereign Korean actors in both the North and South. Between January 2001 and May 2004, ROK National Intelligence Service documents indicate that, outside of KCNA or Rodong Sinmun editorials, DPRK policy statements have specifically  and publicly referred to a U.S. "hostile policy" towards North Korea 33 times.81 This is not to argue whether or not such fears  are valid or reasonable, but that the leadership in Pyongyang has deduced that they are reasonable, based largely on inherited negative cognitive biases. With a perception that the U.S. is "resdess with its ambition to conquer the world,"82 and that Washington is advancing what is essentially viewed as an expansionist hegemonic agenda, the DPRK has adopted a deterrent posture against foreign  forces  through a military-first  policy and a nuclear weapons development program.83 While calling upon Washington to provide it with negative security assurances, Pyongyang has not clearly expressed its rationale behind fearing  a nuclear attack from  the U.S. or elsewhere. The DPRK's proclaimed perception of  a nuclear threat, and its sense of vulnerability, is so consistently called to attention by its media agents and the leadership, that we must consider three possibilities regarding the threat perception itself. Firstly, the perceptions are wholesale and genuine.  The DPRK continues to fear  invasion and aggression by neighbouring powers (inferred  through Japanese leaders' visits to the Yasukuni shrine, ambiguous acknowledgement of  Japanese war crimes in contemporary schoolbooks, and U.S. defense  arrangements with both Japan and the ROK), it fears  nuclear attack or compellence through nuclear threat (internalized through its experiences in the Korean War and through U.S./ROK nuclear contingency planning through to the senior Bush administration), and to a certain extent, 81 DPRK specific  usage of  the term "hostile policy" peaked in August and September 2002, prior to the visit of U.S. special envoy James Kelly and the onset of  the second nuclear crisis. The NIS has noted seven references made during this time. The term "hostile policy" was also referred  to four  times in August 2003 in advance of the first  round of  Six Party Talks in Beijing. Please see various documents from  the National Intelligence Service, Overview of  Reunification  Issues: The fsic)  50 Years of  South-North Relations. <http: / / www.nis.go.kr/ eng / security/ issue_index.html> 8 2 "KCNA Detailed Report," please see <http://www.fas.org/nuke/guide/dprk/nuke/dprk051203.html > 8 3 Ibid. Despite proclaiming a desire to achieve denuclearization, the DPRK has referred  to its contemporary nuclear weapons program as taking the "principled stand of  defending  the country's independence," without going as far  as saying that such weapons could be deployed to foreign  targets. fears  a subtler U.S. invasion smuggled in through the Trojan horse of  South Korean engagement, ultimately designed to "swallow it up."84 Secondly, DPRK threat perceptions are political.  They come as a result of  the powerful  role of  the military in North Korean governance, as only sustained rationalization of  external threat can adequately mollify  North Korean domestic audiences into accepting the brutish conditions of extended totalitarian rule.85 As Kim Jong II continues to assert that "the military is the most important state power in the DPRK," 86 the military needs a rationale for  this pre-eminence. Only by sustaining an atmosphere of  unending national emergency can the North Korean domestic audience tacidy endorse the regime's basis of  legitimacy: fervent  nationalism, defense  against aggressors, and a guerrilla-knows-best political hierarchy.87 This point speaks most clearly to factional  political elements within the DPRK. As touched on earlier, we can identify  several general political factions  as follows:  1) The Korean People's Army (KPA), which dominates political affairs,  maintains key representatives in high-ranking positions, and officially  appropriated the leadership from  the Korean Worker's Party in a constitutional revision in 1998.™ Also, 2) the Korean Worker's Party (KWP),  which is responsible for  much of  the ideological work, propaganda, Juche teachings, and mass mobilization projects. This faction  is more dogmatic in its rhetoric, and explored, has lost political ground to the KPA and to an empowered technocracy. 3) The Kim family  itself,  and its immediate close supporters, represent the monarchic faction  that is primarily concerned with the sustenance of  its own rule. The Kim entourage has consistendy managed to mobilize both the propagandist resources of  the KWP in maintaining the cult of 84 Rodong  Sinmun  editorial, cited in Nautilus Institute documents, <http://www.nautilus.org/DPRKBriefingBook/multilateralTalks/DPRK=PackageSolution.html > 8 5 Scott Snyder and Gordon Flake, Paved With Good Intentions: The NGO Experience in North Korea. (Praeger Publishers, 2003), p 113 8 6 "DPRK has bright future,"  Korean  Central  News  Agenty  (Sep. 4, 2003) 8 7 Stephen Noerper, "Regime Security and Military Tension in North Korea," in Moon (1998), p 168 8 8 The constitutional revision of  1998 sanctified  the position of  "president" as literally unattainable by anyone other than the late Kim II Sung, essentially burying the highest office  in the land. As a convenient default  for the guerrilla establishment, the head of  state was thus deemed to be the Chairman of  the Defense  Commission, with Kim Jong II predictably incorporated into the position. This had the effect  of  uniting KPA forces  and the Kim family  into a political axis at the highest levels, and signals some preceding competition for  legitimacy between the KPA, the KWP, and an emergent technocracy. personality and dynastic legitimacy, and the organizational, economic, and disciplinary resources of the KPA. Kim Jong Il's continued "military-first  policy" as an ideational objective speaks to the political debt owed to the guerrilla establishment that has legitimized his rule, as well as the need to maintain theocratic legitimacy based on a confluence  of  Kim dynastic lineage and the military's association with this lineage. 4) An emergent technocracy that manages new economic reforms, studies international trends, and participates direcdy with external engagers. As will be seen below, this faction  is likely the newest and politically weakest, but has made enormous ground over the course of  the engagement process, and has supplanted a weakened KWP in many close advisory circles. This political factionalism  may be potentially explosive, and it is natural that the leadership consistently seeks to micromanage such factions  through domestic balancing. Thirdly, threat perceptions are geopolitical.  Maintaining a public international profile  as aggrieved, vulnerable, and victimized by hegemonic ambitions, allows the DPRK to justify  a military-first  stance to international players. State mouthpieces such as the KCNA justify  Pyongyang's sporadic adherence to international treaties, citing past foreign  aggression and seemingly insincere efforts  at reconciliation. Furthermore, such a stand sets the stage to demand improved conditions of reconciliation, through financial  and political reparations for  past wrongs. "Aid" then becomes "compensation," which has the desired domestic effect  of  legitimizing channels of  dependence within a Juche ideological framework. 8'J Threat Perception and Implications for  Engagement: Resistant None of  these possible stimuli behind threat perceptions (genuinely perceived or politically constructed) bode well for  a foreign  power hoping to pursue engagement with the DPRK. To the extent that threat perceptions are genuine, engagement encounters barriers, as decision makers in 8'J fn  interesting ways, framing  foreign  humanitarian aid as foreigners'  tokens of  apology serves two ideological purposes within the Juche rubric. The historical term sadaejuui  (lit. "serving the great") refers  to tribute payments made by Silla, Goryeo, and Joseon Korean dynasties to the more powerful  Chinese kingdoms. If sadaejuui  is interpreted as an embarrassing characteristic of  Korea's past, contemporary chajusong  ("standing for oneself')  becomes an important part of  Juche thinking. "Aid," however, would violate chajusong  independence: "compensation" is then interpreted as simple historical justice, and "gifts"  actually become part of  an inverted sadaejuui,  with the DPRK itself  as the new "great" power being paid tribute to. "Gift-giving"  from  abroad, so the logic goes, gives testament to Korea's rise from  shameful  subordination to a position of  international respect. Pyongyang remain suspicious of  the external powers pursuing the process. As Park has posed, North Korea suspects that "both engagement and sunshine policies are designed to force  the Pyongyang government to give up the present system and accommodate reforms  and restructuring in line with capitalist civil society."9" This is not an irrational fear,  as engagement has been understood earlier as overdy directed towards socializing the target state towards new norms acceptant of  the source-based political and economic system. To the extent that threat perceptions are smokescreens to justify  militarist behaviour, then engagement may see some intermittent headway, as the process is not entirely suspect in Pyongyang. However, the military establishment may knowingly and deliberately provoke concurrent international tension in order to maintain a sense of  "threat" within the country. This would be an arrangement whereby economic aid, joint-venture projects, international investment and increased imports allow the regime to step out of  the domain of  economic losses, yet these reformist  initiatives will be balanced by increased political indoctrination,91 the maintenance of  hostile relations with neighbouring powers, and a sustained role for  the military as the pre-eminent political institution in the country. While it may be extremely difficult  to ascertain with certainty whether a DPRK-proclaimed sense of  overt external threat is genuine or not, there is a constant trajectory of  negative historical influences  that have provided the template for  the regime to legitimize a sense of  threat domestically. The nature of  extended material losses in the DPRK have allowed real risks to regime legitimacy to develop, and so I argue that it is unlikely that negative cognitive biases have been entirely fabricated. The consequence of  extreme apprehension to cooperate with international actors has been a diminished capacity for  the regime to sustain itself. 92 While threat perception has been likely 9 0 Park (2002), p 105 9 1 According to one South Korean scholar, the Institute of  Economy at the Juche Academy of  Science (the prominent epistemic wing of  the KWP) in Pyongyang has made "strenuous efforts"  to balance an empowered propagandist front  against increasing reforms  and contact with outside engagers. See Choi Wan Kyu, "The Current State and Tasks of  the Study of  Change in the North Korean Political System: A South Korean Perspective," in Moon (1998), p 57 9 2 Snyder and Flake (2003), p 113 manipulated and exaggerated by regime elites in order for  a military-first  policy to remain salient, this exaggeration does not connote a total forgery  of  threat perception. There are clear risks for  regime stability that are incurred through an engagement policy, as such policy necessarily implies changes in the political and economic basis of  the country. Thus, the fear  of  foreign  powers' engagement motives (inherited through negative cognitive biases and through a legitimate awareness of  the regional defense  posture directed against it)93 is flanked  by another related, though more pragmatic, fear.  Even if  engagers are perceived as fair  and trustworthy in their offers,  there remain internal fears  relating to how economic reform  and a degree of  integration with international norms will affect  domestic perception of  the regime. Engagement, then, may be seen as a form  of  external threat, while it may also generate internal threats. Conclusions We have seen how Schweller's typology of  dissatisfied  states embraces degrees of engagement when dealing with limited-aims revisionist states, and the DPRK is characterized specifically  as a limited-aims revisionist, risk-acceptant state encountering increasing material losses and political isolation. This has lead to a mixed reaction towards engagement in North Korea. There exists a willingness to participate in engagement structures that deliver economic goods, nationalist Korean cultural goods, and enhanced regime stability through material and political support, while there exists resistance to engagement structures that deliver ideological challenges and provocations against the basis for  regime legitimacy. The KPA (and to a strong degree, the Kim family  as well) also benefits  from  maintaining a degree of  threat perception, as it reifies  their importance in the political and ideological hierarchy. These benefits  are not shared equally across factions,  however, as any reformist  elements within the emergent technocracy are stunted by actions that inhibit engagement. Moreover, the socialist administrative structure inherited from  early DPRK statecraft  has resulted in 9 3 Only in July 2004 has the South Korean Ministry of  Defense  openly discussed plans to abolish the term "main enemy" in regards to North Korea. See Ryu Jin, "Conservatives stick to NK as main enemy," Korea  Times (Jul. 15, 2004) rigid political institutions, which are strengthened through strict, traditionally vertical relations of authority), and inhibit the progress of  reform-minded  policy. Figure  3.2: DPRK  Responses  to  inter-Korean  Engagement In order for  internal, organic reform  to spontaneously emerge, an active engagement approach will need to exploit factional  divisions within the target, so the socialization process can be offloaded  onto internal target agents. As argued earlier, this is best attempted when there are internal agents that represent potential challenges to the establish political hierarchy. If  the KWP faction  is associated most closely with "identity," and the emergent technocracy is most closely associated with reversing the "domain of  losses," we can see two factions  that are potentially cooperative, using the above table. Issues of  identity can be pursued by a "cultural engagement" stream that attempts to re-orient nationalist identity, and "economic engagement" streams attempt to empower technocratic elements that can come to challenge military dominance over economic and political affairs.  The Kim family's  role as a faction  is primarily to manage these rival factions,  and thus will be (and has been) capable of  abetting this kind of  change. Thus, the political and military establishment in the DPRK, which maintains serious resistant behaviour against engagement, is left  aside in the ROK's active engagement project, with the internally defiant  factions  targeted as agents of  change. In the next chapter, I will evaluate the specific  process of  engagement as seen between the ROK and the DPRK, as there are clear successes and failures  in the engagement process that correspond closely to this analysis of  active engagement. The inter-Korean dynamic gives the process a particular advantage, as Seoul can manoeuvre around perceptions of  being a "foreign"  power smuggling anti-Korean values into the North. At the same time as there remains high suspicion in Pyongyang that the ROK is too heavily influenced  by the U.S., there is also a demonstrated desire in the North to achieve the goal of  unifying  the Korean nation and cooperating with brethren who are seen as trapped behind geopolitical constructs. Such unification  is no longer part of  a militarist objective, but part of  the nationalist discourse that has long replaced state socialism as the principal ideological foundation  of  the regime. C i-r A T ii R F o u r ROK Sunshine Initiatives and DPRK Responses It was through an understanding of  North Korea's threat perceptions, its increasing domain of  economic and political losses, and its high value placed on ideological goods that the ROK's development of  a GRIT-modeled active engagement strategy emerged in the 1990s. Skeptical forces in the ROK and abroad worried that attempting to engage the militarist regime along these lines would only feed  its massive army and thus enable it to achieve the capacity for  increased brinkmanship and the development of  unconventional weapons. Following a de-linked engagement approach, it was argued, did not create the disincentives for  defection  that were needed, as military confrontationalism  would not be punished by the engagement source through cancellation of economic goods.1 Harrison, while relatively optimistic that North Korea was prepared to take engagement seriously, that the technocratic class in Pyongyang was hungry for  political influence,  and that they were "ready for  significant  security concessions in response to economic and political concessions,"2 nevertheless observed that economic transactions and goodwill initiatives had no causal bearing on issues such as arms control or proliferation. 3 In Bermudez' detailed report on the state of  the North Korean military, he noted that the KPA serves a greater function  in the DPRK than only as an deterrent force  against invasion. "The entire nation is built around the KPA. It is more than a military organization, it is the nation's largest employer, purchaser and consumer."4 Indeed, the military is an essential tool in the DPRK's economic development, with soldiers performing  agricultural services, labour and capital contributions to civilian construction, technical and management expertise, as well as building highways, subways, and entering into commercial enterprises. Military units were responsible for  the 1 One prominent critic of  inter-Korean engagement has called the Sunshine Policy an exercise in "self-deception." See Nicholas Eberstadt, "Conference  Diplomacy, All Over Again," Nautilus Policy Forum Online Qui. 6, 2004), <http://www.nautilus.org/fora/security/0425B_Eberstadt.html > 2 Harrison (2002), p 148 3 Ibid, p 147 4 Bermudez (2001), p 17 construction of  massive industrial projects such as the Sineuiju Cement Plant, the Hungnam Fertilizer Plant, and the February 8 Vinylon Factory.5 An estimated 50% of  time spent by soldiers in the military is spent pursuing economic activities,6 which helps not only to generate income and maintain infrastructure,  but helps to pay for  the inhibitive costs of  maintaining the one-million-man army itself.  "In estimating North Korean costs in sustaining one of  the largest armies in the world," Hunter has argued, "proper allowances must be made for  the productive contributions of  the military to the economy."7 Even without consideration of  the enormous cultural and ideological function  that the KPA plays in consolidating its political power, this economic dimension helps to give an engagement approach its intrinsic rationale. Without creating new channels of  economic opportunity between the DPRK and the outside world, the military maintains a domestic monopoly on economic activity.8 Without reformist  elements in Pyongyang emboldened by successes built through an engagement process, these elements are left  further  and further  behind the KPA in the Kim family's  cultivation of an ultra-nationalist (if  unconventionally socialist) regime identity, with significant  enough political support among elites. Robert Scalapino has argued that, while it is extremely difficult  to ascertain the ground gained by any reformist  factions  within Pyongyang through engagement, only through giving the technocratic class the means to develop reformist  policy can the DPRK come to resemble "an 5 February 8 is celebrated as "Army Day" in the DPRK. Vinylon, widely produced in the country, is a polymer fibre  co-invented by Lee Seong Gi, a Korean physics student in Japan during the Occupation. Lee spearheaded research and development of  the synthetic fabric  in the DPRK post-Occupation, while there is some speculation that the process of  vinylon production also creates chemicals that may be used for  military purposes. See Eric Croddy, "Vinalon, the DPRK, and Chemical Weapons Precursors," Centre for Nonproliferation  Studies document (Mar. 23, 2003), <http://www.nti.org/e_research/e3_23a.html> 6 Hunter (1999), p 88 7 Ibid, p 86 8 The DPRK Economic Forum has identified  four  principal "economies" at work within the DPRK: the military economy, the court economy (isolated to the elites and the leadership), the rural economy, and the regional economy. However, I have argued that only the military economy has been capable of  generating public works projects, industrialization, large-scale agricultural ventures, and produce for  international trade, which is reflected  in the high proportion of  arms exports as a function  of  North Korea's export portfolio.  See "Engagement and Development in the DPRK," Report from  the 2nd Annual DPRK Economic Forum, Asia Pacific  Center for  Security Studies, Honolulu (July 27-28, 2000), p 5 authentic pluralist state (...) in the fashion  of  China."9 This reflects  a relative loss in the economic role of  the KPA faction  towards the purely technocratic faction. This chapter will detail the economic and cultural channels that the ROK has established and exploited in its GRIT approach towards the DPRK. Economic engagement has sought to bring Pyongyang out of  its domain of  continuing material and humanitarian losses, thus beginning the process of  a slow shift  from  risk-acceptant to risk-averse behaviour, and allowing the North Korean leadership to develop a stake in the status quo.1" Once such a stake is established can it be possible for  deeper, comprehensive engagement through institutionalized arrangements and binding strategies to take place, as elements in Pyongyang will begin to have internalized the benefit  flows  that economic engagement provides into its sense of  endowment. Cultural engagement has allowed South Korea to frame  its motives as consistent with North Korean identity by calling upon a pan-Korean nationalist desire for  reunifying  the divided nation, reaffirming  common ethnicity and historical influences,  accommodating family  reunions and joint sports and arts exercises, issuing joint statements on certain issues pertaining to third parties, and through emphasizing Korean efforts towards inter-Korean cooperation above and beyond international efforts  for  such peace, thus appropriating the term "self-reliance"  as inclusive of  both Korean states in regards to domestic issues. All this occurs at the same as overtly political engagement is kept low-key, with inter-ministerial meetings designed to coordinate economic activity and to foster  a common sense of cultural interaction, rather than open discussions about reform,  human rights, system change, or openly pursuing the creation of  a binational confederacy,  as such ambitions still threaten the statist nationalism that runs parallel to North Korea's ethnic nationalism in the sustenance of  regime legitimacy. As such, it may appear that "political engagement" has taken place through inter-9 Robert A. Scalapino, "Korea: The Options and Perimeters," in Akaha (2002), p 21 10 To borrow from  Johnston and Evans, a change in target state identity comes "different  audiences matter differendy."  Empowered technocracies, for  example, result in a leadership that needs to solicit political support from  such factions.  See Johnston and Evans, "China's Engagement with International Security Institutions," p 252 ministerial meetings, and through the North-South Summit of  2000. I do not identify  this as genuinely political engagement, however, as the substance of  these interactions of  primarily pursuant to logistical matters concerning economic initiatives and cultural exchanges. Simply because certain meetings are dominated by politicians does not automatically make such meetings political in nature. While inter-Korean military meetings in 2004 have indicated some progress on establishing "binding," political agreements surrounding security, this difficult  type of  engagement stream is very new, and requires extensive legalistic agreements and significant  reforms  in bilateral official  relations. That is to say, truly political engagement at this stage is premature. Economic Engagement: Nourishing Risk-Aversion, Structuring Incentives ROK economic engagement initiatives began taking root after  the mid-1990s and the victory of  democratic reform  activist Kim Dae Jung. During his first  attempt at the presidency in 1970, Kim had formulated  a broad, three-pronged engagement platform  towards the DPRK that advocated 1) peaceful  coexistence, 2) liberalized relations, including economic and cultural, and 3) peaceful unification  of  the Peninsula." Through to the 1980s, as North Korean unification  proposals became modeled more and more after  decentralized, confederal  precepts, Kim Dae Jung's North Korean approach began to resemble unification  as a slighdy more centralized model than he had previously advocated, signaling the role-reversal between North and South Korea in terms of  economic prowess and ability to control the unification  agenda. As argued earlier, once DPRK capacity to dominate in a bi-national unification  system subsided, its calls for  unification  by absorption subsided, as it became clear it would be Pyongyang  being  absorbed rather than actually absorbing the South. The Chun Du Hwan regime in the ROK, however, denounced Kim Dae Jung's confederal  Korea plan. While Chun nevertheless pursued a measure of  economic engagement sporadically between 1984 and 1986, 11 Kim Jeong Yong, "The Impact of  President Kim Dae-jung's Beliefs  on North Korea Policy," Korea  Observer 34:2 (2003), p 274 principally through delivering aid for  flood  victims, there was little in the way of  a sustained engagement policy.12 By 1991, Kim Dae Jung had revised his ideas regarding North Korea, abandoning outright unification  with the view that, mindful  of  the German experience, the shock to the DPRK would be too great to manage without consuming enormous material and political energy from  the burgeoning South. Kim's new Confederation  of  the Two Korean Republics design would have seen the maintenance of  separate capitals and separate economic and political systems, with both Pyongyang and Seoul coordinating foreign  policy and defense  postures through a confederate  council with limited responsibilities. Kim Dae Jung believed that economic liberalization in the DPRK was "inevitable and that adoption of  a market economy was the first  step towards a democratic society."13 This "first  step" did not connote an immediate or simultaneous advance between economic liberalization and democratic reform,  but a consequential process by which democratic reforms  would follow  the establishment of  a free  market system and substantial prosperity — indeed, the process that the ROK followed  out of  authoritarian governance under Park Chung Hee and Chun Du Hwan was similar in respect to the effect  of  an established export-driven economy and a maturing consumer class preceding the outgrowth of  democratic institutions. Through considering democratization as an organic outgrowth of  a market economy, there was little drive to pursue a comprehensive engagement strategy that would have demanded simultaneous reforms  in the DPRK across an array of  linked issues. Lim Dong Won, a principal engineer of  the Sunshine Policy and former  Unification  Minister under Kim Dae Jung, argued that a containment strategy toward the DPRK would actually stifle  the "natural" evolution into a capitalist, democratic system, leading to a "prolonged dictatorship and a 12 Nam Sung Wook, "Theory and Practise: Kaesong and Inter-Korean Cooperation," Hast  Asian  Review 13:1 (Spring 2001), p 70 13 Ibid, p 278 worsening of  people's pain."14 Lim noted that the Sunshine Policy was designed with three considerations in mind: 1) although the DPRK economic system had failed,  the nation would not collapse, 2) economic reforms  had begun and could be encouraged, and 3) despite these changes, the DPRK's military belligerence would continue.15 The ROK openly understood that there would be no immediate causal link between its engagement policy of  private rewards along a GRIT formula  and a comprehensive die-down of  a threatening rhetorical posture from  Pyongyang.  It could be expected that, to compensate for  any nascent foray  into market sociahsm, DPRK leadership would counterbalance with a sustained and invigorated military-first  policy in order for  the regime to buttress its ideological endowment.16 The logic of  ROK engagement, though, was along the lines of  Moon's earlier assertion that spontaneous and organic changes within the DPRK would emerge as a result of  new economic incentives and channels, and so it would be of  litde long-term consequence that Pyongyang may experience strong spasms of  ideological fervour  in the short term, and quite possibly, increased violations of  North Korean citizens' human rights as the regime intensified  its repressive political system. This repressive system would inevitably become unstuck so long as economic engagement was enabling reformist  elements within the communist hierarchy to advance with further  economic reforms  which would, in time, create new domestic economic agents outside the military. Joel Wit observed that "speed bumps" would inevitably occur along the course of  the engagement process, which would indicate that engagement as per a GRIT formulation  is a long-term, non-linear method — not that it is a failing  method.17 The initial engagement structure, though, was not to be advanced as an array of  sustainable economic channels or joint venture projects, but as ad  hoc  confidence-building  measures such as aid deliveries. This low-level type of  engagement would not require any political or military reciprocal 14 Lim Dong Won, "How to End Cold War (sic) on the Korean Peninsula," speech presented to Korea Development Institute, Seoul (Apr. 23,1999), archived at NAPSNet  Special  Reports, <http://www.nautilus.org/napsnet/sr/index.html> 15 Ibid 16 Harrison (2002), p 33 17 Joel Wit, "North Korea: Leader of  the Pack," Washington  Quarterly  24:1 (2000), p 84 action on the part of  the DPRK, and would be ultimately a low-risk, non-committal endeavour for Pyongyang.  At the same time as working to reduce threat perceptions in the North through aid delivery, the ROK was able to satisfy  domestic support for  a humanitarian programme vis-a-vis the North. As such, between 1995 and 2001, just over $450 million in developmental aid flowed  from the ROK to the DPRK, commencing with a massive 150,000-ton rice delivery in 1995. ROK aid deliveries peaked again in 2000 and 2001 with $140 million in clothing, fertilizer,  medicine, and corn being delivered mostly through the World Food Programme and the World Health Organization.18 This aid accounted for  25% of  the ROK's total development aid budget during these years. While a January 2000 editorial published in the Rodong Sinmun indicated apprehension in the DPRK regarding the development of  an economic commonwealth as promoted by Kim Dae Jung,19 calling it a degradation of  Korean relations to "mere economics," the North-South Summit held in Pyongyang in June of  that year presaged a more substantive economic relationship than aid deliveries.2" Joint venture projects such as an ROK-dominated industrial park in the southern North Korean city of  Gaeseong (Kaesong), 21 the establishment of  an international tourist centre at Mt. Geumgang run by ROK conglomerate Hyundai,22 and the reconnection of  rail and road links that had been severed by the DMZ, were planned in consequence of  the agreements made during the summit. While the Joint Declaration made between the two Kims was a vaguely worded proclamation, asserting no more specifically  than to "promote balanced development of  the national 18 ROK Ministry of  Unification,  cited in Snyder and Flake (2003),  p 126 19 - Rodong  Sinmun  0an. 9, 2000), cited in National Intelligence Service documents Overview of  Reunification Issues: The (sic) 50 Years of  South-North Relations (Jan. 2000), <http://www.nis.go.kr/eng/security/issue_index.html > 2,1 It should be noted, though, that the summit was encouraged by the prospect of  financial  incentives offered to Pyongyang by Seoul should Kim Jong II agree to host the meeting. 2 1 Gaeseong as a site for  the park would have two mutual advantages. For one, it is geographically accessible to both North and South Koreans, given its proximity to Panmunjom and the DMZ, simplifying  logistical matters, shipping, and supervision. Secondly, though, Gaeseong has historical symbolic significance,  as the city served as the capital of  a newly unified  Korea under the Goryeo Dynasty over one-thousand years ago. 2 2 Hyundai chairman Chung Ju Yeong would meet Kim Jong II personally on several occasions, personally helping to develop the plans for  the Mt. Geumgang resort, and apparendy becoming a key confidant  of Chairman Kim in regards to reform  policies and the introduction of  corporate capital. Kim Jong II sent an official  statement of  remorse to Seoul upon Chung's passing in March 2001. economy through economic cooperation," the significance  of  the term "national" as inclusive of both North and South was a deliberate indication of  the close association that would be pursued.23 Aid would continue in various forms,  including the ROK-funded  construction of  a gymnasium in Pyongyang in 2000, developmental aid directed towards prevention of  flooding  along the Imjin River, sustained food  aid to alleviate the famine  conditions in the North, and disaster relief equipment following  a large train explosion in the North Korean city of  Ryeongcheon. Besides aid, though, it would be the creation of  the Commission for  Stimulation of  Inter-Korean Economic Cooperation that would aim to move beyond aid, instead aiming to expand business contacts between North and South. Through inviting and hosting DPRK delegates to study market enterprise in the ROK and formulating  economic policy for  commercial enterprises working in the DPRK, the initial groundwork was being laid for  North Korea to possess the capacity to pursue the economic incentives of  engagement without coercion or demands for  reciprocal actions. The Gaeseong Industrial Park headed by Hyundai was one way in which accrued incentives would replace coercion as a tool of  influence.  The project, designed to house 700 light manufacturing firms,  was intended in Seoul to have "spillover effects"  such as the development of  neighbouring communities, employment opportunities for  North Koreans, infusion  of  foreign  capital through exports, and impetus for  reconnection of  trans-DMZ land links. This would lead to a "multi-functional  city, catering to international trade, tourism, manufacturing,  commerce, and housing."24 Labour costs are estimated to run as low as $57.50 per worker per month, with Southern firms  taking advantage of  Northern impoverishment. One analyst noted that Gaeseong would be "the largest ever combination of  Northern labor and Southern technology, which would bring tangible benefits  to both sides."25 2 3 A transcript of  the North-South Joint Declaration is available at BBC News (June 15, 2000), <http://news.bbc.co.Uk/l/hi/world/asia-pacific/791691.stm > 2 4 Nam (2001), p 78 2 5 Park Seok Sam, chief  economist of  the North Korea Economic Studies Division of  the Bank of  Korea, cited in "Industrial Park in NK Draws Southern Firms," Korea  Update  15:14 (Aug. 9, 2004) Well before  Gaeseong would be officially  designated as a trade zone, the DPRK began participating in significant  inter-Korean trade beyond the absorption of  aid, with a 58% jump in trade between early 2002 and early 2003,26 and a 47.4% increase again between early 2003 and September of  the same year.27 The ROK imported $36.71 million worth of  textile and agro-fisheries  products from  the DPRK in January and February of  2003, while the ROK managed to export $52.03 million, mosdy in machinery.28 By the end of  2003, inter-Korean trade reportedly totaled $724 million,29 with the ROK replacing China as the DPRK's top export market for  the first  time, importing $233.75 million.3" While the balance of  trade continued to favour  the ROK, Kim Dae Jung had continued to drive against the possible threat perceptions in the DPRK regarding South Korean absorption through to the end of  his tenure. Aware that so long as the North was ultimately dependent on the South to a disproportionate degree, fears  of  absorption would remain salient, and Pyongyang would seek to balance against this dependency with a heightened militarist posture. Kim Dae Jung repeated calls to the U.S. to relieve their sanctions against the North, in line with earlier statements he had made to former  defense  secretary William Perry.31 While DPRK trade with Japan declined over the same period, largely due to Tokyo's linking of  diplomatic problems (such as Kim Jong Il's admission of  a past covert program to kidnap Japanese citizens) with economic issues,32 South Korea remained firmly  on a path of  GRIT engagement and the de-linking of  political and economic matters. This issue separation was at its clearest immediately following  the DPRK nuclear admission in October 2002. Despite Pyongyang's assertion that it "may possess" nuclear weapons and, regardless, that it deserved to possess them in order to protect its sovereignty, Peninsular engagement efforts  continued unabated, with successful inter-ministerial meetings taking place in Pyongyang the week following  the nuclear admission. A 2 6 "Inter-Korean trade rises over 58 percent in Jan-Feb," NK  Chosun  News  (Mar. 19, 2003), <http://nk.chosun.com/english/news/news.html?ACT=detail&linkv=-l&res_id=7753> 27 Korea International Trade Association statistics (Dec. 9, 2003) 28 NK  Chosun  News  (Mar. 19, 2003) 2 9 Anthony Faiola, "A capitalist sprout in N. Korea's dust: industrial park to broach free  market," Washington Post  (May 23, 2004) 3(1 Kim So Young, "South top export market for  North," Korea  Herald  (December  10, 2003) 3 1 Harrison (2002), p 86 32 "DPRK increases trade with Asian neighbours," Korean  Overseas  Information  Service  (Nov. 18, 2003) joint press release published after  the meeting detailed mutual plans to accelerate the construction of the two rail links across the DMZ, develop the Gaeseong industrial park project, hold a working level meeting at Mt. Geumgang to arrange a maritime agreement on the passage of  civilian ships through each others' waters, and South Korean use of  fishing  grounds in parts of  the East Sea under North Korean jurisdiction.33 By the summer of  2004, many of  these promises had been realized, with ground broken at the Gaeseong Industrial Park (and South Korean firms  prepared to move in by November 2004), two trans-DMZ roadways (the so-called Gyeonggi and Donghae lines) completed,34 and various maritime agreements, such as the North-South Agreement on Marine Transport, reached between North and South Korean navies concerning increased communication and preventative measures against armed sea clashes.35 The policy of  Roh Moo Hyun has largely been one of  continuing Kim Dae Jung's work through the Sunshine Policy, although there are some indications that Roh has deviated from  the GRIT formulation  in favour  of  a more comprehensive engagement approach. The Roh administration has argued at times that "there can be no acceleration of  its mutual peace and prosperity policy without settling (the nuclear) problem," and by May 2003, Roh openly Linked North-South exchange to progress on the nuclear front. 3rt This does not reflect  a reversal of  Kim Dae Jung or Lim Dong Won's approach entirely, though, but is likely more reflective  of  Roh's need to appease conservative forces  within the Seoul government who were consistently critical of providing the DPRK with a "free  lunch," as well as conservative forces  in Washington who were forging  ahead with a North Korea policy more specific  to compellence or deterrence than to engagement. An incremental GRIT approach has been complicated by these pressures, but with exchange and cooperation being "the only leverage that the (ROK) government has in relation with 33 NIS (Oct. 23, 2002), <http://www.nis.go.kr/eng/security/issue_index.html > 3 4 On July 20, 2004, the first  100,000 tons of  rice (one-quarter of  a pledged total for  the year) was delivered to the DPRK from  the ROK through the Gyeongui and Donghae highways now connecting the two Koreas. The South Korean Ministry of  Unification  has said that the land delivery marks the expansion of  "humanitarian exchanges and easing (of)  military tension," although the logistical problems overcome in managing joint venture industrial parks such as Gaeseong cannot be overlooked. See "First overland transportation of  assistant rice to North Korea," ROK Ministry of  Unification  newsletter (July 26, 2004) 3 5 "Koreas reach accord on ending maritime clashes," Sydney  Morning  Herald  (Jun. 4, 2004) 3 6 Koh Yu Hwan, "Roh's N.K. Policy Lays Groundwork for  Unification,"  Korea  Now  (Mar. 6, 2004), p 8 the North,"37 Roh's policy has not actually gone through with the cancellation of  sustained economic engagement. DPRK Reactions to Economic Engagement: Cooperative and Resistant Cooperative Kim Jong Il's public mourning of  the passing of  Hyundai founder  Chung Ju Yeong in March 2001 can be seen as an economically-motivated olive branch extended from  Pyongyang to lucrative ROK chaebol  corporations: a token of  respect paid to the companies that may potentially pay back rather significantly.  While Chairman Kim's statement may have simply been contrived for  gain, it is no trivial or low-risk act for  the North Korean leader to have demonstrated sorrow at the death of  a pre-eminent southern capitalist. In making such a statement, Chairman Kim has given evidence to the political influence  won by reformist  elements in the Pyongyang hierarchy and the degree to which capitalist principles are no longer seen as inconsistent with DPRK policy and ideology. In July 2001, a Pyongyang rally commemorating the 90th anniversary of  the birth of  Kim II Sung took place, with participating officials  using the opportunity to advance a new paradigm in the ideology of  production. While statements made at the rally included the necessity of  a continued military-first  policy, officials  reportedly proclaimed that a "fresh  perspective and approach" must be adopted by workers, as the leadership pursued "improving) the living standards of  the people and (...) strengthening) the national economy, following  the wish of  Kim II Sung during his life." 38 No mention was made of  socialist economic policy in upholding a rather retrospective, propagandist interpretation of  the Great Leader's supposed ambition: national prosperity by creative (i.e. non-centralized) means. Beyond rhetoric, the DPRK has undergone significant  structural change in response to ROK economic engagement overtures. While the pace and depth of  reform  cannot yet be thought of  as wholesale or revolutionary, "measured by North Korea's own yardstick, the reforms  going on there 37 Ibid, p 9 3 8 NIS (July 17, 2001), <http://www.nis.go.kr/eng/security/issue_index.html > have become more and more significant." 3'-1 Rodong Sinmun has proclaimed that "if  we stick to this hackneyed and outdated (socialist) method, which is not applicable to the realities of  today, then we will be unable to develop our economy." 411 Kang has thus agreed that reforms  may be slow, but represent vast changes since the end of  the Cold War and reflect  an "irreversible" trend.41 On the reformist  path, it may be argued that Kim Jong II has long been interested in introducing market principles to the DPRK economy, with personal tours to Shanghai private manufacturing  centres as early as 1985.42 He would visit the city again in 2001, touring the Stock Exchange, high-tech NEC plants and GM automotive plants, while skipping over Beijing entirely.43 By the time Kim Jong II formally  took control of  the country in 1997, following  his appointment as General Secretary of  the Defense  Commission, he wasted litde time in applying for  admission to the IMF and the Asia Development Bank, although Japan vetoed DPRK admission to the ADB at that time.44 Harrison has noted that, while the new constitution ushered in the following  year subordinated the KWP to the armed forces,  it also paved the way for  an elaborated technocratic class to develop in place of  Party ideologues. "Out of  twenty-three vice-ministers and deputy ministers in ministries dealing with the economy in late 1998, sixteen were new appointees,"45 marking the first steps in a bureaucratic sea change concerning fiscal  policy. By the 11th Supreme People's Assembly in 2003, another pro-pragmatist cabinet shuffle  brought former  plant manager (and delegate to study South Korean economic practices in Seoul) Pak Bong Ju to the prime ministership, despite his having been ranked as only the 188th most powerful  Communist official  in 1994.46 According to 39 ROK National Security Council policy coordinator Wi Sung Lac, cited in Faiola (2004) 411 - Rodong  Sinmun  (Nov. 21, 2001), as cited in Victor D. Cha and David C. Kang, "Can North Korea be Engaged? An Exchange," Survival  46:2 (Summer 2004), p 91 4 1 David Kang, "North Korea has a point," Financial  Times  (Jan. 3, 2003:2) 4 2 Choi in Moon (1998), p 58 4 3 Nam (2001), p 69 4 4 Harrison (2002), p 35 4 5 Ibid, p 37 4 6 Lee Dong-hyun and Ko Soo-suk, "Changes to cabinet indicate will for  economic reform,"  JoongAng  I/bo (Sept. 15, 2003) Korea University professor  Nam Sung Wook, "(s)uch a (cabinet) shows that the North seeks to accelerate its reform." 47 Balancing the military's political demands against the demands of  a reformist  generation occupying much of  the expanding technocracy would require tangible gains to be made through new economic policy, and this technocracy would have to substantially outperform  the military economy in reversing the domain of  losses that had brought the DPRK into material bankruptcy. While Kim Jong II may have calculated that hosting the inter-Korean summit in 2000 would bring certain side payments direcdy from  Seoul, as indeed, former  Hyundai chief  Chung Mong Hun masterminded the transfer  of  $500 million of  government funds  to Pyongyang in order to secure the summit itself. 48 This has important implications for  our understanding of  the summit's true meaning in the DPRK. Kim may have seen the prospect of  hosting the summit as litde more than a means of  securing a significant  economic gift  while paying lip service to ROK engagement overtures in a nationalist context. For the ROK, however, the payment was likely made within the rubric of  an active engagement policy (as opposed to an appeasement policy) as the value of  the summit itself  was seen as a means of  1) kickstarting a socialization process in the DPRK whereby ROK agents would be seen as partners instead of  adversaries, and 2) generating a higher array of  expectations in both Koreas that engagement must make progress, thus having a residual impact on future  negotiations regarding increased integration. The surreptitious delivery of  this large sum of  money does not reflect well on the integrity of  the engagement process, but this does not necessarily subtract from  the process as "engagement" as opposed to appeasement. In support of  Moon's argument, the most marked economic changes were generated internally and organically in the DPRK following  the summit. These changes are apparent through a detailed reform  policy initiated in 2002, though the policies were likely enabled through South Korean efforts  at demonstrating a steadfast  interest in investment. 4 7 Nam Sung Wook, cited in Lee and Ko (2003) 4 8 Shortly after  this covert transaction became public and Chung was publicly accused of  embezzlement, he committed suicide by leaping from  the 12th floor  of  Hyundai's Seoul offices.  See "Hyundai chief  jumps to death," Shanghai  Star  (Sept. 7, 2003) Through the new policy, farmers'  markets were not only tacitly permitted, but were overdy promoted by Pyongyang,  as the ideological tenet of  "self-reliance"  became restructured towards "community self-reliance"  and individual entrepreneurship. Local production units supplanted Party committee heads as decision makers in local economic management.4'-1 The failing  Public Distribution System (PDS), the rationing arm of  Pyongyang's  command economy, was curtailed, and worker's wages became commensurate with productivity. As prices were liberalized, public markets emerged throughout the country, resulting in up to 25% of  the DPRK's economy being managed privately.5" One notable public market, the Tongil (Unification)  Market, was created in the suburbs of Pyongyang in 2002. PDS staples, along with imported goods, are sold freely,  leading Guardian correspondent Jonathan Watts to speculate that Tongil signals a movement "closer in line with the successful  economic reforms  that have transformed  neighbouring China."51 Goods at Tongil are comprised of  roughly half  consumer goods and half  agricultural goods, with thousands of  vendors are "encouraged to be competitive" in their sales.52 "There is an atmosphere in which everyone wants to make money now. Most people haven't figured  out how to do it (...) But in this atmosphere, enterprising people are trying to figure  out new angles and ways to make money." One aid worker in the area called Tongil a "halfway  house to privatization."53 Pizza, chewing gum, and Coca-Cola have all been introduced to DPRK markets since 2002, a South Korean convenience store chain Family Mart opened an oudet at Mt. Geumgang, and North Koreans have opened their own online store featuring  postcards, Korean ginseng and domestically-produced artwork for  sale to international buyers.54 By late 2003, South-North Korean joint venture automotive manufacturer  Pyeonghwa ("Peace") Motors was producing vehicles in the DPRK out of 4'J Cha in Cha and Kang, (2004), p 91 5 0 Park Sukh Sam, "Measuring and Assessing Economic Activity in North Korea," Korea's Economy 2002. Korea  Economic  Institute  (2003), p 77-80 51 Jonathan Watts, "Market forces  reshape the world's last Orwellian state," Guardian  Weekly  (Dec. 3, 2003) 5 2 Selig Harrison, as cited by Erich Weingartner, "Selig Harrison Reflects  on his Latest Trip to the DPRK," CanKor (May 28, 2004), <http://www.cankor.ligi.ubc.ca/issues/167.htm#six> 53 Ibid 5 4 Ko Soo-suk, "Pizza in Pyongyang,"  JoongAng  Ilbo  (June 3, 2002); "First convenience store to open in DPRK," Korea  Herald  (Nov. 7, 2002); "DPRK opens online shop," Korean Trade and Investment Promotion Agency document (Oct. 21, 2003) Fiat parts, and before  long, the company was permitted to launch a billboard advertising campaign along North Korean roadsides.55 The Sineuiju free  trade economic zone on the DPRK-Chinese border has seen renewed activity in 2004, after  the prospective capitalist industrial enclave was stymied by the arrest of  its Chinese administrative head, Yang Bin, by Beijing authorities in the fall  of  2002. Relocation of residents in the town has begun in order to make way for  new industrial park infrastructure,  although continued construction awaits adequate foreign  investment.56 The Gaeseong zone was officially declared open by Pyongyang on November 13, 2002, just three weeks after  the Supreme People's Assembly decreed Mt. Geumgang as an official  tourist zone with liberalized laws regarding South Korean investment.57 By March 2004, the two Koreas had adopted the Agreement on Inter-Korean Settlement and Clearing, which would deal with clearing and settlement methods, credit lines, and interest rates. Resistant While the reforms  have produced certain problems in the DPRK, mosdy through exacerbated poverty among a new lower-class with wages drastically out of  step with new unfixed prices, these problems have not been significant  enough to cause a reversal of  reform  policy. ROK investment in key zones, coupled with the development and employment that it brings, has posed less of  a danger to the Kim regime than a sustained domain of  material losses incurred through a military economy and a totally closed society. The dangers of  capitalist ideology corroding the basis of  North Korea's regime legitimacy domestically will continue to be a concern for  elites, who have still been wary of  promoting many of  their engagement ventures at home. Immediately after  the train explosion at Ryeongcheon, South Korean Red Cross officials  were rebuffed  when they proposed delivering aid relief  through the Gyeonggi land route, insisting upon a more lengthy sea delivery58 — a 5 5 Anthony Faiola, "North Korea experimenting with capitalism," Dawn  Internet  Edition  (Sep. 16, 2003), <http://www.dawn.com/2003/09/16/intll.htm> 5 6 Ko Soo-suk, "DPRK holds out hope for  Sinuiju," JoongAng  I/bo  (Dec. 5, 2003) 5 7 NIS (Oct.-Nov.  2002),  <http://www.nis.go.kr/eng/security/issue_index.html > 5 8 Lee Young Jong, "North spurns trucked goods," JoongAng  Ilbo  (Apr. 26, 2004) move that signaled concern in North Korea that over-zealous economic engagers in the South might take advantage of  the emergency to set a precedent in using the new route to win continued easy access to the North (as noted above, the land route was nevertheless utilized three months later to deliver rice aid deliveries). Also, by summer 2004, few  North Korean refugees  in China were reportedly aware that the Mt. Geumgang tourist resort or the Gaeseong industrial complex even existed,59 giving testament to the cautious and highly localized nature of  economic reforms  at this stage. While I have identified  four  key factions  in the DPRK thus far  (Kim family,  KPA, KWP, and the technocracy), the economic reforms  have the capacity to empower a fifth  hitherto relatively powerless political faction:  civil society. If  economic power can be translated into political power, then leaving many economic activities in the hands of  individual entrepreneurs operating out of markets creates a new political class with power behind their interests. Market economies also create a new underclass of  poor citizens, who will potentially advance new demands upon the leadership to manage the welfare  system in an egalitarian fashion.  The emergence of  a complex civil society in DPRK is still some distance away, yet the potential for  enhanced power that lays dormant in North Korean society puts significant  pressure on the leadership to pursue the reforms  cautiously. It would not be fair,  however, to equate caution with insincerity. Critics have charged that Pyongyang does not sincerely desire reform,  and so advances it only far  enough to solicit new investment towards regime survival, but not far  enough to impact the society generally. Kim Jeong Yong has taken note of  the skeptical argument, that "the ruling elite, especially the military, believed that, rather than change, survival required redoubling domestic socio-political control through intensified  indoctrination and surveillance, and maintaining tension on the Peninsula."60 The maintenance of  tension may indeed enable the military to achieve political legitimacy, and the KPA's role in defending  the nation against real or perceived threats is certainly its principal source of 5 9 Jung Sung Ki, "NK refugees  abandon refugee  bids to South: remain in China to care for  families  in North Korea," Korea  Times  (July 29, 2004) 6 0 Kim Jeong Yong (2003), p 283 authority. At the same time, it would be against the empirical record to argue that significant  reforms have not occurred, or that Pyongyang has not leapt over significant,  if  incremental, domestic legal and political hurdles in order to advance a new economic paradigm. Lim Dong Won has spoken to this point, stating that while the steps thus far  may appear small and relatively isolated, "these small changes will accumulate and pick up speed."61 While Victor Cha has argued that "(n)either the language nor the nature of  these initial reforms  appears to have the same conviction of  those seen in China or Vietnam,"62 David Kang has echoed Moon in observing that, regardless of  whether or not Pyongyang is actually ideologically converted to capitalism, there are "unintended political and economic ramifications  that will accompany even minimal and reluctant economic reforms.  Whether Kim Jong II likes it or not, the dire economic situation in North Korea has forced  him down a path that will be difficult  to reverse."63 It is precisely through a severe domain of  material losses (compounded by the unproductive military economy, the society closed to outside access, and the diminished array of  allies) that Pyongyang has moved towards deeper reforms  with long-term considerations. Given that Pyongyang has studied the prospects of  economic opening for  years prior to ROK engagement, yet had not pursued the matter in any committed fashion  until that time, we can attribute contemporary reforms as contingent on the role South Korea has opted to play. As Seoul's Sunshine Policy has provided a steady source of  aid directed to alleviating threat perceptions, enabling an impoverished and malnourished labour force,  and winning access and influence  to North Korean official  counterparts, it has then evolved to establishing conditions conducive to investment, deeper economic cooperation, and better returns for  a Pyongyang regime staffed  by a nascent generation of  pragmatic technocrats. 61 Lim (1999) 6 2 Cha in Cha and Kang (2004), p 92 63 Kang in Cha and Kang (2004), p 100 Overall The DPRK's apprehension to become dependent on the ROK combines with fears  that Sunshine is a subde and corrosive form  of  gradual ideological invasion — a vision of  South Korean "promises" as Trojan Horse "threats" that corrode domestic political goods. This inspires a cautious attitude in Pyongyang,  and the KPA is able to play the balancing role of  not only deterring foreign forces  from  invasion, but also "deterring" undue capitalist influence  through its nourishing of  a sense of  threat. Every reformist  step necessitates a new conservative step to balance regime legitimacy/'4 Factional divisions over the pace of  engagement became discernible in the DPRK — while the KWP stated on Mar. 2, 2000 that the ROK should abolish its National Security Law and allow for "complete freedom  of  activity for  all activists in the unification  movement," the KCNA editorialized only two weeks later that the Sunshine Policy was "an attempt at unification  (...) by scuttling our ideological and spiritual resistance." Measures such as intensified  indoctrination and the maintenance of  threat perception, as noted by Kim Jeong Yong, as well as the acceleration in developing a nuclear deterrent and a continued military-first  posture, may well be seen as critical tools in maintaining regime integrity: emphasizing some political goods (conservatism, ideological nationalism and Korean sovereignty) while allowing other political goods (socialist superstructure and the command economy) to mutate. These conservative counterbalancing measures do not come instead of  economic reforms,  though, but rather in parallel to them. Reformist  changes have been real, as the emergence of  markets, relaxation of  price fixing,  downgrading of  PDS channels, promotion of  pragmatic technocrats, and the constitutional changes to accommodate the acquisition and sale of  private property have all shown. Cha has argued that there is nothing strange about this counterbalancing, and that indeed, Pyongyang's  history of  delicate political counterbalancing throughout the Cold War and afterwards shows that a change-oriented engagement strategy can be carefully  manipulated by DPRK elites. 6 4 Choi in Moon (1998), p 57 Noting Kim Jong IPs dilemma that "he needs to open up to survive, but in the process of  opening up, he unleashes forces  that could lead to the regime's demise," Cha asserts that there is no inherent reason why a prolonged totalitarian political system will corrode in step with economic opening/'5 Chairman Kim's emphasis on nationalism and the military are consistent with calls for  a "rich nation and  a strong army."66 While reforms  seen so far  may reflect  this point, that Pyongyang seeks the best of  both worlds in which economic strength is secured while a militant, nationalistic Kim dynasty retains power, the argument advanced by Moon, Kang, Park, Snyder and others is driven by the logic that the DPRK will inevitably become constrained by its drive to cooperate when faced  with economic opportunity. This will reduce the rationality of  brinkmanship as a negotiating tactic, as the country will have been moved into the domain of  risk-aversion. On certain counts, however, the DPRK will resist moving into this domain, and will move intermittently, so long as increased dependence on external powers provokes powerful  threat perceptions. Thus, DPRK has been cooperative with economic engagement streams insofar  as they satisfy  1) recovery from  a domain of  losses, 2) proclaimed goals towards eventual unification:  goals for  which economic strength is prerequisite, and 3) a diversification  of  policy options away from  military brinkmanship in pursuing negotiation. Conversely, the DPRK has been resistant to these streams insofar  as they 1) are seen as threatening to political goods and regime legitimacy, and 2) incongruent with political identity. It is mindful  of the latter points that the ROK's cultural engagement stream has been proffered  alongside economic engagement. Cultural Engagement: Moderating Negative Cognitive Biases One line from  a popular children's song tells the story of  ROK efforts  to ease threat perceptions first  and build institutionalized structures later: "First comes love, then comes marriage." This serves as a simple characterization of  Lim Dong Won's "easy first,  hard later" approach to GRIT engagement with the North, particularly in regards to the trade in cultural goods. The 6 5 Cha (2004),  p 94 6 6 Ibid (emphasis added) cultivation of  a common identity as "brethren," the reduction of  mutual threat perceptions, and the emphasis on the social goods to be won through enhanced cooperation are executed first.  Only once this common identity and sense of  "we-feeling" 67 is strong enough, as fostered  by the two sovereign Korean states, can an institutionalized, formal  and legal arrangement (such as a political confederation)  be pursued. This arrangement would effectively  reify  the two Koreas ambitions for cooperation in a broader, binding way. Binding mechanisms and the structuring of  common institutions, however, would be reflective  of  a comprehensive engagement approach: the prerequisite to this is that the DPRK is moved away from  risk-acceptance and towards risk-aversion. Given the high threat perceptions in the DPRK towards outside powers, we have seen the how the very economic goods that may provoke this move towards risk-aversion may also be seen as threats to political goods. In such a case, threat perceptions need to be alleviated at the same time as potentially politically corrosive influences  (the means for  substantial economic change) are delivered. Seoul's cultural engagement angle is thus designed to alleviate fears  in Pyongyang that South Korea is truly external, since threat perceptions in the DPRK are largely a function  of  fear  of  the external power. Seoul has made pains to demonstrate itself  as benevolent towards the whole Korean nation, respectful  of  domestic cultural legacies, and interested in enhancing a pan-Peninsular nationalistic identity in line with North Korea's own calls for  independence from  foreign  influences. There are three specific  types of  cultural engagement Seoul has offered:  1) exchange of cultural displays, or joint cultural displays, in such spheres of  sports and the arts, 2) routinization of family  reunions between relatives separated by the DMZ, and 3) non-binding, joint North-South statements of  intent or opinion regarding common interests, such as ambitions between the two states, or joint positions on third-party actions. Each of  these types requires some empirical detail before  analyzing North Korean responses. 6 7 Amitav Acharya has called a "we-feeling,"  or sense of  common identity among regional states, necessary if such states are to pursue close, institutionalized cooperation, particularly in the security sphere. See Amitav Acharya, Constructing a Security Community in Southeast Asia: ASEAN and the Problem of  Regional Order. (Roudedge,  2001), p 18 Cultural  Displays Three months before  the North-South summit took place, the new ROK-based joint venture Pyeonghwa Motors had already hosted an invitation of  the Pyongyang Students Performing Arts Company at the Seoul Art Centre. Through the Joint Declaration in 2000, however, the scope of cultural exchange has expanded, with an average of  83 South Korean citizens going to the DPRK each month for  what the Ministry of  Unification  has deemed "social and cultural" purposes (See Figure 4.1).68 These visits have included exchange of  musical performances  (by symphony orchestras, traditional Korean music groups, and South Korean pop stars), art displays, sport exchanges, and theatre productions. One such production has been "Chunhwangseon," a Joseon-era opera that tells of  two lovers reunited after  a prolonged forced  separation. Other events have been more political in nature, with pro-unification  rallies in the DPRK in attendance by South Korean representatives, NGOs, student groups, and labour organizations. Unity conventions, while seemingly political, though, have been designed as a form  of  cultural interaction, allowing South and North Koreans to mingle alongside the accompanying side-events such as photo and art exhibits, art troupe performances,  track meets, hiking excursions, and informal  academic debates/'9. 6 8 ROK Ministry of  Unification.  With an average of  83 visits per month, every month of  the year 2000 was a below-average month for  social and cultural exchange. 2001 and 2002 were above average 3 months and 4 months respectively, and 2003 was above average for  6 months. 2004 has been above average for  4 of  the first 6 months. 6 9 NIS (Aug. 5, 2002), <http://www.nis.go.kr/eng/security/issue_index.html > Cultural and Social Exchanges, ROK to DPRK (Jan. 2000 - Jun. 2004) Figure  4.1 Source: ROK Ministry of  Unification (Note: data not available for  Dec. 2001, Sep. 2002, May 2003) An important prong of  the cultural drive overall has been the attempt by Seoul to solicit ROK media firms  in taking up the cause of  promoting unification  and, it would be assumed, consider giving attention to the positive features  of  the process. In early August 2000, ROK Minister of  Culture and Tourism Park Ji Won led a delegation of  46 presidents of  media companies to visit Pyongyang,  where they reached an agreement with their Northern counterparts, including provisions to "increase media activities conducive to national unity and unification"  and "no more libel and slander."70 Less than two weeks after  this meeting, ROK broadcaster Korea Broadcasting Service 7 0 Ibid (KBS) hosted the DPRK's National Symphony Orchestra at the KBS Concert Hall,71 and by October, another ROK broadcaster, SBS, was permitted to travel to the DPRK to cover celebrations for  the 55th anniversary of  the founding  of  the KWP.72 Later that month, North Korean television broadcast a South Korean documentary highlighting Korean tigers living in Siberia. In relation to sports, Taekwondo team exchanges and tournaments have enabled the two Koreas to engage with each other through their national sport, and other joint events such as shortened marathons at Mt. Geumgang have been held. While the DPRK did not qualify  to field  a team during the 2002 World Cup co-hosted by Japan and the ROK, the North Korean Football Association head Ri Kwang Gun sent a congratulatory message of  congratulations to the South Korean Football Association upon South Korea's strong showing in the tournament. Ri stated that "it is a joint victory for  the nation, as was the 1966 London World Cup (in which the DPRK advanced to the quarterfinals).  The Games reinforced  our view that if  the Korean nation united its forces  and wisdom, we would be able to achieve independent unification  with far  greater strength."73 In February 2004, the ROK and the DPRK agreed to a joint Olympic entry during the opening ceremonies for  the Athens Games, repeating the symbolic joint entry made in during the Sydney Olympics in 2000. Bearing a common flag  in the Opening Ceremonies, depicting only a geographic image of  the Korean Peninsula, an ROK Olympic Committee official  noted that the two sides would "cooperate actively" to field  a unified  team in 2008.74 This sense of  common nationhood was also reflected  in the summer of  2004, when the Manhae Prize (an annual South Korean award given to the most outstanding work of  literature in the Korean language) went to a North Korean novelist for  the first  time.75 7 1 NIS (Aug. 18, 2000), <http://www.nis.go.kr/eng/security/issue_index.html > 72NIS (Oct. 9, 2000), <http://www.nis.go.kr/eng/security/issue_index.html > 7 3 Pyongyang Television, as cited in NIS (June 30, 2002), <http://www.nis.go.kr/eng/security/issue_index.html > 7 4 South Korean Olympic Committee spokesperson Choi Eun Ki, cited in "Koreas to March Together at Athens Olympics," Korea  Now  (Mar. 6, 2004), p 5 7 5 "NK writer wins Manhae Prize," Korea  Times  (Jul. 22, 2004) Tourist  and  Family  Exchange Family exchanges have proven to be of  enormous symbolic significance  in advancing an atmosphere in which North and South Koreans are "brethren" who are separated by political circumstances, but not by social ones. Ten reunions have taken place between the summer of  2000 and the summer of  2004, with over 9,000 participants having crossed the DMZ each way. The first reunion took place on August 15, 2000 — coincidental^, the 55th anniversary of  the liberation of Korea from  Japanese occupation. The date itself  has been commonly chosen as an emblem of cultural sovereignty and patriotism, with the founders  of  the ROK choosing August 15,1948 as the day of  the state's official  founding. In September 2000, in an effort  to mollify  DPRK fears  that Seoul remained fundamentally postured against the North, 63 pro-Pyongyang expatriates in Japan were invited by Seoul to visit their families  in South Korea. While this may not have been a direct act of  cultural engagement with the North, Seoul's efforts  to accommodate pro-North elements at home and abroad, if  only in a low-risk and cosmetic way, have been intended to impress potential engagement target north of  the DMZ. Besides family  reunions, cultural exchanges, and visits of  a business nature, the major source of  ROK civilian penetration into the North has been through the Mt. Geumgang tours, operated by Hyundai Asan as a cruise boat tour to the North Korean resort. Between January 1998 and March 2004, well over 600,000 South Koreans visited Mt. Geumgang.76 By March 2004, the tours began generating a profit  for  the first  time, as the average monthly total of  visitors topped 16,000 people.77 Aidan Foster-Carter has noted that, for  the DPRK, the tours serve the rudimentary purpose of generating revenue,78 whereas for  the ROK, the tours serve the double purpose of  1) achieving deeper penetration into the North, and 2) generating the perception among South Koreans that historical landmarks in the North are legitimate "domestic" travel destinations. 76 "NK eases restriction on Mt. Kumgang tour," Yonhap  News  Agency  (May 26, 2004) 7 7 Aidan Foster-Carter, "The Real Deal?" Comparative  Connections  (Apr.-Jun. 2004), <http://www.csis.org/pacfor/cc/0402Qnk_sk.html > 7 8 Ibid Joint  Positions The most direct and mutually viable type of  joint statement has typically concerned perceived inadequacies in Japanese atonement for  its imperialist history. Recent editions of  Japanese history schoolbooks have de-emphasized the more violent aspects of  the Occupation, prompting both Seoul and Pyongyang to formulate  joint positions against Tokyo's "sins of  omission." Pyongyang has certainly been more enthusiastic in its vilification  of  the contemporary Japanese leadership in order to maintain the rally-around-the-flag  effect  that helps to legitimize the leadership, and Seoul is likely wary to associate itself  with such high-tempered rhetoric. The schoolbook issues, however, combined with Japanese territorial claims to the islets of  Dokdo/Takeshima (disputed between the ROK/Japan), have given both Koreas opportunity to make symbolic gestures of cooperation and common outlooks in regards to third party events. A third avenue for  joint positions has arisen through Chinese claims to the historic northeast Asian kingdom of  Goguryeo. One of  the three founding  kingdoms of  Korea's first unification  under the Silla Dynasty, Goguryeo occupied both the northern half  of  the Korean Peninsula and parts of  Manchuria, and is considered in Korea to be an ethnic Korean kingdom with a causal cultural bearing on successive Korean dynasties. As China successfully  solicited UNESCO to establish a "joint" World Heritage Site in both Manchuria and North Korea to commemorate the Goguryeo, Seoul has found  an increasingly politically viable opportunity to join Pyongyang in condemning what is perceived as cultural appropriation.79 DPRK Responses to Cultural Engagement: Cooperative and Resistant Cooperative Generally, cultural engagement has been a low-risk venture for  the DPRK, although they have accepted more South Koreans into the country than they have ventured to send to the ROK themselves. Total South Korean visitors to the North have more than doubled between 2000 and 2003, from  7,280 to 15,280. North Korean visitors to the South have also become more frequent, 7 9 ChoiJie Ho, "Fight over Goguryeo flares,"  JoongAng  Ilbo  (July 14, 2004); Choi Soung Ah, "Seoul might ask Pyongyang to join in Goguryeo battle," Korea  Herald  (Aug. 6, 2004) although the scale is less impressive: 706 in the year 2000, and 1,023 in 2003.811 This imbalance can be attributed to Pyongyang's  concerns that even politically reliable DPRK citizens are at risk of  undue Southern influence  through exposure to life  in the ROK, if  only for  short periods of  time. Pyongyang has thus been fairly  accommodating on the family  reunions front,  but has pushed for  the establishment of  a permanent family  reunion centre at Mt. Geumgang, rather than continue to send North Korean citizens to mingle among the crowds in Seoul, no matter how controlled the reunions are. Interaction between North and South Koreans has been permitted in endeavours that not only provide economic benefits,  yet are also dressed in the flag  of  nationalist, cultural interaction. Under the tutelage of  the Korean Peninsula Energy Development Organization (KEDO), 100 North Korean workers mingled with over 800 South Korean workers through building infrastructure  for light-water reactors under the provision of  the U.S./DPRK Agreed Framework. The infrastructure itself  would an on-site "community village" for  workers, with dining rooms, churches and temples, a tennis court, a library, and a "karaoke" room (a customary Korean norebang).  The elaborate recreation facilities  on site were designed as a means of  enhancing a community atmosphere between KEDO member-state nationals, principally South Koreans, and DPRK nationals, building confidence,  and augmenting tributary communication links. The ROK was publicly pleased that "workers began to cooperate with each other (...) in a friendly  mood, thereby expanding mutual trust."81 Given the dichotomy between possible rationales behind DPRK threat perception towards the South (firsdy,  that a sense of  threat is genuine, and secondly, that a sense of  threat is a political good in itself),  these ROK measures at alleviating threat perception are not difficult  to accept for North Korea. Firsdy, if  the DPRK genuinely feels  threatened by South Korea and sees economic engagement as a Trojan Horse, then cultural interaction helps the regime to manage its incremental shift  away from  socialist legitimacy to nationalist legitimacy. Cultural engagement thus aids 8 0 ROK Ministry of  Unification 8 1 Peace and Cooperation: White Paper on Korean Unificatio n. ROK Ministry Of  Unification  document (2001), p 173 Pyongyang in accommodating a stable transition into a profit-driven  market system. The side effect of  this benefit,  however, is that the nationalist legitimacy that Pyongyang seeks to cultivate continues to require a source of  external threat. This leads into the second possibility, that the threat perception is a political good to be valued. The DPRK may accept cultural engagement, although Pyongyang will shift  its sense of  threat perception away from  Seoul and towards Washington, Tokyo, or other perceived belligerent powers. In determining whether threat perceptions vis-a-vis the ROK have been diminished, one very interesting indicator is the change in language regarding perceived enemies versus public perceptions of  the Seoul government — this change has run congruent to the cultural engagement policy as initiated by Kim Dae Jung and as continued by Roh Moo Hyun. Rodong Sinmun and KCNA reports have continued, between 2000 and 2004, to oscillate between vitriolic furor  and the occasional conciliatory note vis-a-vis external powers. Japan and the U.S., however, continue to be either assailed or accommodated as entire political entities, which uniformly  harbour malevolent intentions towards the DPRK. Regarding Seoul, however, there has been a dearth of  perceptible negative cognitive biases towards the ROK as a singular political entity. Instead, during points of tension with Seoul, Pyongyang has publicly chastised "anti-unification  forces  in South Korea," "far right-wing conservatives in South Korea," "ultra-conservative forces,"  "bellicose elements," "South Korean military authorities," or specific  conservative political parties and members, principally "gangs of'  the Grand National Party and former  party leader Lee Hoi Chang, but not the entire southern state.82 This reflects  a more conciliatory view of  Seoul, an understanding that the South is politically divided between some genuine hawks and some genuine doves, and trust that there are dependable agents in the ROK that do not intend harm towards the DPRK. Relationships with these agents have been publicly valued insofar  as the leadership under Kim Dae Jung and Roh Moo Hyun has largely been avoided as targets of  blame during points of  friction  over logistical matters and military matters 8 2 Various documents, NIS (2000-2003), <http://www.nis.go.kr/eng/security/issue_index.html > such as clashes in the West Sea or incursions over the maritime border, the so-called Northern Limit Line. While military talks between North and South have been slow to materialize, agreements have been reached this year that established a security hotline, and clear, diplomatic channels for  dealing with perceived trespassing over maritime borders, as well as conduct over the DMZ, which reflects an appreciation for  the political pressure exerted upon the ROK military by the engagement-minded administration. Whether this is a direct function  of  cultural engagement strategies is difficult  to determine, but the change in the KPA's position towards one of  holding dialogue over contentious security issues does represent the political value of  cooperation in Pyongyang,  as well as the perception that South Korean forces  can be dealt with in such form  as a negotiating table. This political good may be tied to the benefits  incurred through economic engagement, but cultural engagement has been used to facilitate  and rationalize deeper economic ties to skeptics at home in Pyongyang. The Joint Declaration achieved during the North-South Summit may be ambiguous in its language, but the emphasis on cultural solidarity has become a real political good for  Pyongyang. Regardless of  whether these goods have been used to actually enhance cooperation in a practical manner, or have been used as divisive wedges to exploit points of  friction  between the ROK and the U.S., the DPRK has accepted cultural engagement as a means to enhance its own domestic and Peninsular position. Invoking the "solemn pledge" of  the Joint Declaration has been a meaningful tool for  Pyongyang in its dealings with the ROK, signaling a shift  from  outright provocation towards actually seeking to exploit dovish South Korean factions  into keeping on a steady course towards the eventual objective of  unification.  This speaks to an interesting development, whereby the ROK seeks to identify  (and pursue engagement with) receptive elements in the North, such as the technocracy, as well as the DPRK seeks to identify  (and pursue engagement with) receptive elements in the South, such as Korean chaebols,  the Ministry of  Unification,  and elements of  Seoul's self-styled  "progressive" leadership. This mutually reinforcing  dynamic actually helps to stabilize the engagement process, as both sides identify  receptive agents who will develop dependence on engagement itself  to deliver key goods: for  the DPRK, this translates primarily into economic and cultural goods, whereas for  the ROK, this translates into electoral goods among a dovish voting public that has developed expectations for  progress with the North. During long-awaited military talks in 2004, which ended in mutual agreement to dismantle propagandist billboards and loudspeakers across the DMZ, the North broadcast final  messages imploring Seoul to "establish a confederate  nation.""3 Shortly after  the DPRK's withdrawal from  the NPT, KCNA editorials and reports referred  to the Joint Declaration as means to implore continued economic engagement: "In accordance with the spirit of  the June 15 Joint Declaration, upholding the spirit of  one nation, we will continue to promote inter-Korean dialogue and cooperative projects."84 Citing a "spirit of  national concord reflected  in the historic June 15 North-South Joint Declaration,"85 North Korean media outlets have been mandated to utilize enthusiasm for cooperation as a means of  voicing the government's intent to continue the engagement process, while also voicing disapproval with perceived collusion between the ROK and foreign,  "imperialist" forces  as a violation of  the Declaration itself.  Thus, a cultural (and largely rhetorical) good has been transformed  into a real political good that eases regime transition away from  outright socialism and towards authoritarian nationalism, as well as a good used to guilt trip agents in the ROK who are not perceived to be pursuing engagement heartily enough. North Korean calls to accelerate the actual achievement of  confederation  may not be thoroughly genuine, as the regime is not in a position to negotiate the conditions of  such a confederation  in its own favour  at this point. Making the call, however, serves as one example of how the DPRK has transformed  the pan-Korean rhetoric for  peace and unity into a political good that 1) keeps North Korean citizens looking to a distant horizon of  nationalist achievement and material well-being (key to distracting the people from  close analysis of  their poor circumstances in 83 ROK Ministry of  Unification 8 4 "KCNA calls for  implementation of  inter-Korean declaration," Korean  Central  News  Agerny  (Jan. 9, 2003); NIS (Jan. 15, 2003), <http://www.nis.go.kr/eng/security/issue_index.html > 8 5 "KCNA slams unreasonable judgment upon Korean social scientist overseas," Korean  Central  News  Agency (Mar. 17, 2004) real time), and 2) encourages ROK engagers to continue their work in securing development aid and economic engagement for  the North, as well as driving wedges between South Korea's two political camps: nationalist doves and Washington-allied hawks, the latter of  which demands evidence of North Korea's sincerity. Resistant This dependence on the Joint Declaration and on patriotic, cultural goods to help the regime to legitimize the economic engagement it needs has also led to points of  significant  friction  and resistance when ROK agents are perceived as insincere — most evidendy, this comes about through various manifestations  of  the ROK/U.S. alliance. Unable to coherendy reconcile a nationalist, self-reliant discourse with joint ROK/U.S. military exercises such as Team Spirit, Ulchi Focus Lens (or U.S. contingency designs such as OPLAN 5027),86 Pyongyang has reacted against engagement efforts in step with perceived cordial links between Seoul and Washington, the latter of  which is seen as a permanent source of  anti-unification  policy. In January 2002, DPRK Central Broadcasting publicly condemned the remarks of  ROK Foreign Minister Han Seung Su, as he encouraged the maintenance of  a "cooperative system between the ROK, Japan, and the U.S." Pyongyang chose to interpret these remarks as invective, saying that they "sabotage the Joint Declaration."87 The DPRK, however, would seek to correct this negative trajectory during the same month, with Pyongyang Broadcasting declaring an official  position that cultural bonds between North and South had grown strong enough to consider the pursuit of  a "low-level confederation,"  and that pursuit of  unification  based on existing "common ground" was feasible.  Two weeks later, Yang Hyong Seop, Vice-Chairman of  the Standing Committee of  the Supreme People's assembly, unveiled "three key appeals and proposals" regarding engagement efforts,  within which he revealed a formal position to "pursue national unification  regardless of  (...) political circumstances," and "eliminate legal and institutional obstacles" to unification  (which would include U.S. troop presence in the ROK 8 6 See "OPLAN 5027 Major Theatre War - West," Global Security document (July 13, 2004), <http://www.globalsecurity.org/military/ops/oplan-5027.htm > 8 7 NIS (Jan. 5, 2002), <http://www.nis.go.kr/eng/security/issue_index.html > and the maintenance of  the National Security Law, but also domestic North Korean hold-ups to trade and investment). Such suggestions may indeed have been intended to exploit ROK/U.S. rifts,  hoping to isolate ostensibly conservative political elements in Seoul such as Minister Han. Regardless, shortly after  these conciliatory overtures, the DPRK withdrew the policy of  Three Appeals, as President Bush delivered his State of  the Union address, describing the DPRK as one of  three "axis of  evil" affiliates. From this point, open mistrust of  various ROK political agents came into the fore,  including military authorities, opposition politicians, and the Ministry of  Unification,  as Pyongyang fruitlessly demanded overwhelming evidence that Seoul was fundamentally  at odds with the Bush Doctrine of pre-emptive war and hostility towards the North.88 The Joint North-South New Year's Event, scheduled to celebrate the Lunar New Year at Mt. Geumgang, was cancelled by Pyongyang.  North-South dialogue would remain at a standstill until April, at which time Lim Dong Won would travel to Pyongyang to craft  a joint press release, essentially reasserting previously established plans to continue family  reunions and "rekindle the (sic) inter-Korean relations." Even when cultural goods are seen as relatively low-risk endeavours, the DPRK has nevertheless interpreted negotiations over logistics as an opportunity to engage as hard bargainers in materially insignificant,  face-saving  exercises. Controversial venues, such as a monument to Kim II Sung's Koryo Confederate  unification  model, have been chosen by DPRK authorities as locations for  joint ROK/DPRK  cultural events, such as August 15 celebrations, causing consternation in Seoul, and successively difficult  periods of  dialogue over possible venue changes. In October 2001, the issuance of  security alerts in the ROK during the U.S. war in Afghanistan  led Pyongyang to delay 8 8 Many in the South Korean leadership went to great pains to demonstrate to Pyongyang that the new U.S. position was not shared in Seoul. Kim Dae Jung replaced his ambassador to the U.S. with a new representative with lower credentials, and some progressive ROK congressmen publicly demonstrated at the U.S. embassy in Seoul, carrying signs reading "Bush, you are the root of  evil." A dramatic overhaul in the ROK/U.S. alliance, however, was an unrealistic expectation, and Pyongyang interpreted the general maintenance of  ROK/U.S. status quo as indicative of  an ultimate Southern subservience to foreign  obligations. See Kim Hakjoon, "Sunshine or Thunder? Tension Between the Kim and Bush Administrations in Historical Perspective," Korea Observer  34:1 (2003), p 33 its exchange of  Taekwondo teams, family  reunions, and talks over easing restrictions for  investment relating to Mt. Geumgang tours. Despite an ROK initiative proposing alternate venues away from Seoul to host the talks and meetings, the DPRK suggested that such a proposal "makes no sense."89 Pyongyang has sought to complicate logistical and technical issues pertaining to cultural exchanges as testing grounds for  ROK resolve, as the DPRK links economic and cultural engagement issues to the arena of  defense  and security. This has complicated ROK efforts  towards maintaining a de-linked engagement agenda, as perceived threats cause Pyongyang to politicize each type of  engagement stream. Overall ROK participation in U.S. military exercises, or acquiescence to U.S. pressures in the sphere of  defense  and security, has made cultural engagement more difficult,  as the DPRK is able to frame Seoul as controlled or managed by an external power, thus running against engagement-minded ROK officials  who are determined to portray themselves as actors "internal" to the Korean nation. While this complicates Seoul's efforts,  Pyongyang still finds  immediate advantage here by manipulating the threat perceptions that require even deeper concessions. The capacity to exploit dovish ROK factions  is enhanced through participation in cultural engagement streams, and the job of  North Korean propagandists to label economic engagement as "financial  retribution" is made easier. The ROK, for  its part, has remained dedicated to pursuing a GRIT formula  that attempts the depoliticization of  each engagement stream, regardless of  "speed bumps" that are perceived in Pyongyang.  South Korea's acceptance of  over 200 North Korean refugees  in the summer of  2004 led to a temporary suspension of  ministerial level talks, as a DPRK Foreign Ministry spokesman stated that "dishonest elements in South Korea" had teamed with the U.S. in luring the North Koreans away during visits to Manchuria.9" Roh Moo Hyun responded by simply stating that "(t)he 89 NIS (Oct. 22, 2001), <http://www.nis.go.kr/eng/security/issue_index.html > 9 0 "U.S. and S. Korean authorities hit for  their allurement and abduction of  North Koreans abroad," Korean Central  News  Agency  (Aug. 3, 2004) government will maintain the policy of  reconciliation and cooperation toward the North, and in this context, will implement agreements on economic cooperation and projects including... civilian exchanges."91 By tending to ignore, or at least downplay, the political implications of  certain actions, the ROK has sought to maintain stability in its engagement efforts.  At the same time, however, the DPRK has demonstrated its ability to perceive and inflate  the political miscues from  the South to its own advantage, as a means of  justifying  hold-ups in the engagement process, raising the price for continued cooperation, and winning bargaining leverage, thus suiting North Korean desires for  face saving. The value of  cultural goods are thus quite significant  for  Pyongyang in its attempts to 1) enhance a positive and cohesive sense of  social identity for  North Koreans as "Koreans" as well as (and more importantly than) being "citizens of  a socialist state," 2) exploit the atmosphere of "common ground" between North and South for  economic and political advantage domestically, and 3) rationalize a perpetual threat perception of  the U.S. as a malevolent obstacle in the potential reemergence of  a greater Korean nation. Cultural engagement streams are resisted, however, as they 1) animate threat perceptions, as they may be seen as covert window-dressing for  an incremental ROK/American takeover strategy, and 2) conflict  with identification  as a fundamentally  self-reliant state. This conflict,  though, is part of  the DPRK's mixed identity as both self-reliant  (patriotic) and essentially Korean (nationalist). Even as the ROK seeks to dissuade Jucheist self-reliance  and encourage a nationalist Korean we-feeling  as the fundamental  basis of  North Korean identity, the very change-oriented nature of  engagement continues to inspire resistance to change on these fronts. Conclusions Both economic and cultural engagement have seen specific  areas of  resistance, insofar  as they correspond with areas of  threat perception and sense of  self-reliance  in North Korea's ideational endowment. These areas of  resistance, however, have been outweighed by cooperation, insofar  as 9 1 Seo Hyun Jin, "Roh upholds reconciliatory policy toward North Korea," Korea  Herald  (Aug. 2, 2004) they appeal to North Korea's 1) need to recover losses, 2) desire to replace Communist and self-reliant ideational discourse with a pan-Korean discourse, and 3) goals for  eventual unification.  It should be reiterated that unification  is no longer advanced as the communization of  the peninsula: instead, the DPRK envisions a confederation  by which both Korean states may maintain regime survival within a new political landscape. Such a politically binding institution, however, is unlikely so long as the DPRK continues to resist engagement for  the reasons cited above. Threat perceptions will first  need to be alleviated and identity will first  need to be reoriented more fully  towards cooperation, and as high threat perceptions and a fear  of  vulnerability is intimately linked to a high domain of  losses, advances in political engagement are halted until the DPRK is able to recover from  its losses. Economic engagement has inspired dramatic institutional changes in the DPRK, but as these changes are recent, significant  returns are still forthcoming,  and dependent on foreign  investment. With the perceived "superiority of  all things Korean" that is inherent in much of  the North Korean self-reliant  discourse, it is easier for  the leadership there to accommodate ROK chaebol  firms such as Hyundai and Daewoo in providing this FDI. This ethnocentrism, however, has not yet significandy  ameliorated a continued mistrust of  "ultra-conservative" political elements in Seoul who are tied to U.S. interests. Washington remains a perceived source of  threats, and the ROK's association with the U.S. has contributed to an incremental cooperative posture towards inter-Korean engagement in the DPRK. In some ways, South Korea's cultural engagement efforts  may be having a more dramatic effect  at home than in the North, as a self-styled  progressive wave within civil society becomes increasingly sympathetic to the North Korean geopolitical situation, and less sympathetic to the U.S. position — this is readily observable in frequent  manifestations  of  anti-American sentiment in South Korea in recent years. With that, Snyder's argument that source states need to give targets "something to lose" in economic terms can be appropriated to explain some of  the North's rationale in pursuing cultural engagement and upholding the emotional significance  of  the Joint Declaration. By cooperating in cultural engagement streams, the DPRK gives South Korea "something to lose" — the electoral good of  appeasing an increasingly nationalist South Korean voting constituency. As family  reunions and joint Olympic marches have become powerful  cultural symbols for  citizens of  the ROK as well as the DPRK, Seoul finds  itself  somewhat tied to an engagement policy in order to satisfy  its own domestic appetite for  such symbols. This would reflect  a major milestone in the inter-Korean engagement process — the point at which "source" and "target" begin to exchange roles across an array of  de-linked engagement streams. Engagement is not a fixed  or universal formula  that applies equally to all dissatisfied  states. The approach may be (and should be) tailored to suit the specific  demands, internal processes of preference  formation,  sense of  threat, and sense of  endowment that each potential target maintains. Active engagement, as detailed in this thesis, is a flexible  and determined approach that seeks to 1) establish increased channels into the target, 2) use these channels to deliver goods and reduce the domain of  losses, 3) empower potentially defiant  agents within the target to offload  the process of socialization into a cooperative set of  norms, and 4) maintain a deterrent against any lash-out or revolutionary scenario. The key to this process is undertaking a thorough study of  what the target conceives as "threat," what the target conceives of  "loss," and which specific  agents within the target will make productive engagement partners. Through this study, I have come to the conclusion that a steady, active engagement approach can have a real impact upon targets that are both materially deficient  and vulnerable and profoundly  hostile to outside influence.  The DPRK has undergone a series of  internal changes as a result of  ROK engagement efforts,  though these changes are largely limited to the GRIT channels that Seoul has pursued: economic management and cultural/ideological orientation. The results here also indicate that the ROK is in a uniquely strong position to carry out an active engagement policy with the DPRK, given that the intra-national character of  the divided nation allows Seoul to portray itself  as a natural partner, and an #«natural adversary. There are still fundamental  questions about the nature of  DPRK threat perception itself.  I have detailed how elements of  this perception are genuine, as the regime fears  1) a regional balance of  power that reflects  increasing relative losses, and 2) that the reforms  necessary to make relative gains could inspire widespread domestic change, and thus a threat to regime stability. The threat, then, may be sourced in the latent capacity for  North Koreans to revolt as much as it is sourced in foreign  powers directly. This reflects  a delicate two-level game being played in Pyongyang,  as the leadership seeks to enhance both its international and its domestic position at the same time — a natural dual-ambition, but one that is complex, as policies towards domestic power consolidation may compromise efficient  foreign  policies. As Putnam has noted in regards to two-level games, "|n| either of  the two games (foreign  and domestic policy) can be ignored by central decision-makers, so long as their countries remain interdependent, yet sovereign. The unusual complexity of  this two-level game is that moves that are rational for  a player at one board (...) may be impolitic for  that same player at the other board."1 With this in mind, threat perception may remain a political good in the regime's domestic propagandist discourse, but will gradually lose effectiveness  as inevitable dependence on engagement streams reduces the value of  this good relative to the benefits  of  bilateral cooperation. What is the capacity for  engagement as a change-oriented strategy to effect  socialization of  a target without provoking the concurrent counterbalancing responses? While comprehensive engagement approaches are more explicit in their attempts to lock the target into an elaborate system of  incentives, the GRIT approach is more implicit, and is mindful  of  target threat perceptions. I have found  that GRIT does not seek to alleviate threat perceptions as a prerequisite to cooperation, but sees threat perception as inevitably corroded once depoliticised incentive channels are established, and the target incorporates these channels into its sense of  endowment. This is meant to inspire organic and incremental change within the target regime, as opposed to change that is highly specific and prescribed by source powers. At the same time, I have come to the conclusion that threat perception in the DPRK is multi-dimensional, comprised of  both genuine vulnerability and political manipulation. Alleviating threat perceptions is a complex task, but it is made even more difficult  when "threat" is a political good for  the conservative, militarist establishment in Pyongyang.  This does not subtract from  an active engagement's ability to affect  the utility of  threat. Even though these conservative elements may exist within the target, and they seek to maintain a pervasive sense of  "fear"  to legitimize their 1 Robert D. Putnam, "Diplomacy and Domestic Politics: The Logic of  Two-Level Games," International Organisation  42 (Summer 1988), p 434 rule, engagement creates footholds  within the government to build allies and confidants  who advantage by the benefits  of  engagement. It also empowers the fifth  faction  — civil society — through encouraging a decentralized economic system that devolves some political power to entrepreneurs and consumers outside of  the immediate state structure. While target leadership may be opaque, identifying  competing interests in the target may help sources to identify  competing factions  within the target state. These factions  (as associating with divergent interests) should be exploited and targeted individually, thus offloading  the process of  socialization onto the target itself. What are the policy implications of  an active engagement approach? Firsdy, any deterrent measures that have characterized the source-target relationship should not be supplanted by an engagement process, but maintained alongside one. Deterrence offers  a decidedly negative consequence to lashing out and to risk-acceptant behaviour, while engagement offers  a better deal: perhaps it is not devoid of  threats (insofar  as change is threatening), but the process is less threatening, and it relieves the domain of  losses that encourage risk-acceptance. Secondly, an engagement project must be long-term in its goals. Delivering benefits  to a target, even if  the conditions for  reciprocity are low, must aim towards a socialization process by which the target comes to 1) depend on the source in certain issue areas, and 2) internalize norms of  cooperation. This means the flexibility  of  active engagement is lower than in hawk engagement. Source states must be prepared to carry out an engagement project over the long term, which can be difficult  for democratic states with a high leadership turnover. Successive governments abrogating the engagement project may do more harm than good, as they roll back the source-target relationship to one of  high mutual mistrust. The target will be less willing to cooperate in any transaction in which it determines the source is bluffing,  concealing true intentions, or unwilling to commit. In this study, I have found  that the inter-Korean engagement process has stabilized itself through allowing norms of  cooperation to emerge both within the DPRK (as limited as these norms may be to specific  issue areas) and in the ROK. After  several years of  engagement, a turnover in the South Korean leadership would not likely result in the end of  the process. This is so because the powerful  cultural and nationalistic symbolism that inter-Korean engagement nourishes has created an electoral class that desires further  cooperation. Even conservative South Korean governments, I argue, will have difficulty  reversing the path to engagement against the will of  a population that largely desires closer integration. Is this the result of  active engagement generally, or is this the result of  the fact  that Korea is a divided nation? I argue that it is both: active engagement has given political power to actors sympathetic to cultural, nationalistic objectives, which has enabled an inter-Korean cooperative discourse to frame  various Peninsular and international issues. The context of  the divided nation makes cooperation more important in a political cultural sense, but this cooperation has only been effectively  animated by the engagement project itself.  This is clear as effective  inter-Korean cooperation did not come about during the Cold War, nor in the immediate post-Cold War period, of  its own accord. With this in mind, the bilateral engagement process between South and North Korea will not necessarily see the target pursue dramatically increased cooperation with non-parties to engagement. This complicates the clarity of  engagement's successes, as the engagement source (ROK) maintains close ties to the target's principal root of  threat perception (United States). The U.S. is incapable of  pursuing a GRIT strategy inclusive of  cultural engagement streams, as the U.S. cannot frame  itself  as an internal actor to the Korean nation without provoking powerful  resistance. The ROK has been concurrendy reluctant to appear close to Washington, while still aware of  the need to retain the alliance for  the purpose of  sustaining the deterrent dimension to the overall mixed strategy. With these considerations in mind, it is not surprising that the DPRK has pursued inter-Korean engagement intermittendy and in tandem with belligerent demonstrations of  sovereignty, including defection  from  the NPT, and the public pursuit of  a nuclear weapons program. These developments warrant international concern, and yet the ROK's insistence on a sustained engagement strategy is necessary insofar  as the young process has not yet delivered enough of  the benefits  of  cooperation to convert them into binding mechanisms. Withdrawing incentives for cooperation at this juncture would not yet equal the reduction of  DPRK baselines of  expectations, and would not yet result in a sense of  loss of  endowment. The carrots, as it were, have not yet become sticks. Cessation of  engagement would increase DPRK risk-acceptant behaviour, and in this domain of  material losses, would increase the odds that Pyongyang would seek to proliferate  in aim of  enhancing its export portfolio. Gains observed by the technocratic faction  in the DPRK, through a remarkable advance through the state hierarchy, influence  observable in constitutional revisions, and the emergence of markets, are congruent with the ROK's active engagement efforts.  Other DPRK factions,  especially the KPA, continue to maintain a heavy influence  on Kim Jong Il's capacity to act: indeed, with Kim's leadership "officially"  predicated on his having been enveloped by the KPA as Defense  Commission Chairman, the military will continue to exert significant  influence,  and are likely to continue counterbalancing measures to slow the pace of  reforms  and to subvert a civil society empowered by economic freedoms.  Identifying  and targeting specific  factions  in the DPRK, as argued, is not simple, and yet the organic changes seen since engagement are largely a function  of  reformist  factions winning political ground. Until projects such as the Gaeseong Industrial Park are fully  functional,  however, the shadows of  the future  for  engagement's benefit  returns remain uncertain. A risk-averse option for enhancing material well-being can only rival the risk-acceptant option of  WMD proliferation  once these returns are secure and the reformist  come to win more influence  with the Kim establishment. Strict North Korean adherence to regimes such as the NPT will be necessary for  the international community to rest assured, and yet such adherence is vulnerable so long as bilateral state relations as per the DPRK remain based on security dilemmas and a sustained sense of  threat. Binding through institutional arrangements can be feasible  only once the states  that comprise these institutions have done the initial legwork in creating dependable channels of  cooperation. This problem speaks to arguments made by Stephen Krasner that regimes hit roadblocks when they attempt to supplant state policy and take on significant  powers over the range of  policies a state party may pursue. This is particularly the case in regards to security, as security policy is a vested state interest that is rarely abdicated to regime directives.2 While the capacity to bind the DPRK into international institutions such as the NPT (or even an eventual bi-Korean confederal  regime) is still fragile,  we have seen that ROK engagement channels have inspired and enabled certain key economic and ideational reforms  that improve this capacity. If  the current trajectory is sustained, we can expect that the eventual diminution of  the North's domain of  losses will create serious stakes in this trajectory; thus, cooperation will be self-reinforcing.  Military belligerence towards external powers will continue to frustrate  the policy, but the political value of  such belligerence will begin to weaken as the benefits  of  engagement are appropriated into DPRK endowment and baseline of  expectations. Two critical questions face  us at the end of  this discussion. Firsdy, is sustained GRIT engagement in the face  of  North Korean nuclear weaponization different  than appeasement? Secondly, how can we be certain that ROK engagement overtures are responsible for  North Korean reforms?  To confront  the latter question first,  it has been argued that North Korean economic collapse in the 1990s, not engagement specifically,  has been the principal impetus behind a minor reformist  agenda in successive Supreme People's Assembly deliberations. Cha has argued that DPRK reforms  are litde more than contained coping mechanisms, and do not reflect  any "trajectory" towards greater opening or increased marketization schemes.3 It is Likely that, without economic collapse in North Korea, engagement would not have been a reasonable strategy for  the ROK or others, since the target state would not be suffering  from  a domain of  losses, thus would be less persuaded by economic incentives. Indeed, these "promises" would outweigh domestic impoverishment as a perceived threat to regime stability. This is not to say, however, that engagement is not causally responsible for  functional  reforms.  Without ROK investment into joint venture projects, developmental aid to help deliver infrastructure  and resources to begin the process 2 Stephen Krasner, "Structural Causes and Regime Consequences: Regimes as Intervening Variables," International  Organisation  36:2 (Spring 1982), p 193 3 Cha in Cha and Kang (2004), p 99 of  "market socialism," no reformist  agenda would generate proper returns. Reformist  elements would remain politically isolated in Pyongyang and the regime would continue to rely heavily on militarization in order to contain the population, and sustain a sense of  regime legitimacy through enhanced fundamentalist  Jucheist ideology. ROK investment is clearly what enables reform  to function. Insofar  as the reforms  are insincere, we have seen through various arguments presented by Moon, Kang, and others, that Pyongyang may not be thoroughly enthusiastic about marketization from  an ideational perspective, but this does not subtract from  the irreversible social changes and new social norms that reform  engenders. While the Pyongyang regime may aspire to contain this social change through counterbalancing, it will be forced  to adapt the premise of  its regime legitimacy as people's expectations begin to change, the liberalized economic system nourishes lateral social interactions, and a purely nationalist pan-Korean identity supplants a rigid, patriotic, state-based identity. Addressing the first  question, regarding the difference  between GRIT engagement without apparent conditions and an appeasement strategy, we should not conclude with the sense that the ROK seeks to pursue a rewarding structure with the DPRK into eternity, regardless of  failed reciprocity. As seen earlier, appeasement does not attempt to socialize the target state into the international system through altering the ideational foundations  of  the regime — instead, appeasement seeks to drive a potentially rogue regime away from  specific  provocations through buyouts. The ROK's GRIT methodology has very few  conditions for  reciprocity at this stage, but as a "general" method, it does not seek to buyout the DPRK in order to avoid specific  transgressions. Nor does it seek to maintain the status quo on the Korean Peninsula: it seeks instead to change the status quo towards peaceable relations, a sustainable, marketized North Korean economic system, and renewed political and social norms that are amenable to institutionalized cooperation and eventual unification. At this early stage, however, few  conditions are attached to engagement as Pyongyang's  new reforms must first  move significantly  beyond the ground-breaking stage, and become established, dependable sources of  economic recovery. Once these reforms  have become established, and ROK engagement is crucial to their maintenance, then the carrots-as-sticks approach may be employed. This, in time, can have considerable effects  on the security sphere, on brinkmanship tactics, and on generally risk-acceptant behaviour as seen in the DPRK thus far. While the DPRK faces  an enormous task in balancing its need to engage for  the sake of  its own survival with its need for  gradual ideational change (also in the interests of  regime survival), the final  paradox is that long-term success in this balance will lead towards some form  of  regime change. If  the inherent motivation behind inter-Korean engagement is eventually creating the conditions conducive to unification,  then state-sovereignty and regime survival will be ascribed to political institutions that do not yet exist, and the DPRK as it is known now (as well as the ROK as it is known) may submerge itself  within a confederated  political structure that renders each contemporary Korean state effectively  void. This is a very far-reaching  scenario, and yet the process of  engagement here has driven towards the establishment of  the norms and resources that may enable such a scenario. To see that Pyongyang has cooperated reluctantly is rational and understandable, as the changes undertaken thus far  present risks that control may be lost to external agents. To see that there has been cooperation at all, and to the degree that the DPRK has accommodated change, is nevertheless impressive, and indicative of  a trajectory towards structured, institutional change. 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