Index

52–334 CC
1998
U.S. POLICY TOWARD NORTH KOREA

HEARING

BEFORE THE

COMMITTEE ON
INTERNATIONAL RELATIONS
HOUSE OF REPRESENTATIVES

ONE HUNDRED FIFTH CONGRESS

SECOND SESSION

SEPTEMBER 24, 1998

Printed for the use of the Committee on International Relations

COMMITTEE ON INTERNATIONAL RELATIONS
BENJAMIN A. GILMAN, New York, Chairman
WILLIAM GOODLING, Pennsylvania
JAMES A. LEACH, Iowa
HENRY J. HYDE, Illinois

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DOUG BEREUTER, Nebraska
CHRISTOPHER SMITH, New Jersey
DAN BURTON, Indiana
ELTON GALLEGLY, California
ILEANA ROS-LEHTINEN, Florida
CASS BALLENGER, North Carolina
DANA ROHRABACHER, California
DONALD A. MANZULLO, Illinois
EDWARD R. ROYCE, California
PETER T. KING, New York
JAY KIM, California
STEVEN J. CHABOT, Ohio
MARSHALL ''MARK'' SANFORD, South Carolina
MATT SALMON, Arizona
AMO HOUGHTON, New York
TOM CAMPBELL, California
JON FOX, Pennsylvania
JOHN McHUGH, New York
LINDSEY GRAHAM, South Carolina
ROY BLUNT, Missouri
KEVIN BRADY, Texas
RICHARD BURR, North Carolina
LEE HAMILTON, Indiana
SAM GEJDENSON, Connecticut
TOM LANTOS, California
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HOWARD BERMAN, California
GARY ACKERMAN, New York
ENI F.H. FALEOMAVAEGA, American Samoa
MATTHEW G. MARTINEZ, California
DONALD M. PAYNE, New Jersey
ROBERT ANDREWS, New Jersey
ROBERT MENENDEZ, New Jersey
SHERROD BROWN, Ohio
CYNTHIA A. McKINNEY, Georgia
ALCEE L. HASTINGS, Florida
PAT DANNER, Missouri
EARL HILLIARD, Alabama
BRAD SHERMAN, California
ROBERT WEXLER, Florida
STEVE ROTHMAN, New Jersey
BOB CLEMENT, Tennessee
BILL LUTHER, Minnesota
JIM DAVIS, Florida
LOIS CAPPS, California
RICHARD J. GARON, Chief of Staff
MICHAEL H. VAN DUSEN, Democratic Chief of Staff
PETER BROOKES, Professional Staff Member
KIMBERLY ROBERTS, Staff Associate
C O N T E N T S
 
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WITNESSES

    Ambassador Charles Kartman, Special Envoy for the Korean Peace Talks, U.S. Department of State
    Dr. Kurt Campbell, Deputy Assistant Secretary for Asia and Pacific Affairs, U.S. Department of Defense
    Hon. Stephen Bosworth, American Ambassador, Republic of Korea
    Ambassador James Lilley, Resident Fellow, American Enterprise Institute for Public Policy Research
    Dr. Fred Ikle, Distinguished Scholar, Center for Strategic and International Studies
    Dr. Nicholas Eberstadt, Visiting Scholar, American Enterprise Institute for Public Policy Research
APPENDIX
Prepared statements:
The Honorable Benjamin A. Gilman, a Representative in Congress from New York, and Chairman, Committee on International Relations
The Honorable Christopher Cox, a Representative in Congress from California
Ambassador Charles Kartman
Dr. Kurt Campbell
Ambassador James Lilley
Dr. Fred Ikle
Dr. Nicholas Eberstadt
Additional information submitted for the record:
Article by Mr. Gilman in Defense News submitted by Mr. Gilman

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Article by Gregory Vistica and Melinda Liu in Newsweek submitted by Mr. Gilman
Article by Robert Manning in the Los Angeles Times submitted by Mr. Berman, a Representative in Congress from California
Article by Donald Gregg and James Laney in The Washington Post submitted by Mr. Berman
Letter to Mr. Hamilton, a Representative in Congress from Indiana, by Hong Soon-young, Minister of Foreign Affairs and Trade, Republic of Korea, submitted by Mr. Hamilton
U.S. POLICY TOWARD NORTH KOREA

THURSDAY, SEPTEMBER 24, 1998
House of Representatives,
Committee on International Relations,
Washington, DC.
    The Committee met, pursuant to notice, at 2:15 p.m. in room 2172, Rayburn House Office Building, Hon. Benjamin A. Gilman (chairman of the Committee) presiding.
    Chairman GILMAN. The Committee will come to order.
    I want to welcome our distinguished panel of witnesses to the House International Relations Committee today to testify on our policy toward North Korea. We appreciate all of you taking time out of your busy schedules to appear before us today.
    It should come as no surprise that we are concerned about our policies toward North Korea. The stakes are very high for our Nation and our allies on the Korean Peninsula and in East Asia. Recently, I dispatched a staff delegation to review the station inside North Korea. Their report was grim and sobering.
    Deterrence has been successful there for 45 years, but I fear that the combination of political weakness on our part, coupled with the growing vulnerability of our forces are leading the United States and North Korea down the road to a conflict, a conflict that no one would like to see occur.

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    Our policies toward North Korea have not been successful under the current Administration. We are paying for bad behavior by rewarding North Korean brinkmanship with benefits. North Korea is now the largest recipient of U.S. foreign aid in East Asia. And in response to recent North Korean provocations, the Administration proposes only to increase its level of assistance. Our current policy of weakness may lead North Koreans to miscalculate our resolve.
    Former Secretary of Defense Casper Weinberger called our policy toward North Korea, and I quote, ''reckless appeasement and naive.'' He called the Agreed Framework ''dangerous nonsense.'' Regrettably, some of us agree. According to press reports, the Agreed Framework created to stop North Korea's nuclear program has not. The problem goes far beyond the press reports of an enormous underground facility north of Yongbyon.
    The Agreed Framework is a deeply flawed accord that has failed to change North Korea's behavior as it was predicted it would. I believe that North Korea has used the Agreed Framework as a cover for their real goal: the ability to deliver nuclear weapons against the United States by the end of the century. In their world, it is a bargaining chip; in our world, it is a clear and present danger to our national security and our allies in East Asia.
    The shortcomings of the Agreed Framework include a lack of onsite verification methods, a failure to address nuclear weapons research and development, and a questionable inventory of North Korea's plutonium holdings. If recent press reports are correct, it is dangerous to perpetuate the myth that the framework has ''frozen'' North Korea's nuclear program when it may have only ''frozen'' the work at one nuclear weapons complex.
    KEDO is in serious financial difficulty. The House voted recently to modify portions of the Foreign Assistance Act of 1961 because the Administration intends to misuse its authority to fund the financing of heavy fuel oil for North Korea. Former Secretary of State Warren Christopher assured us that it would never cost more than $30 million in any 1 year. Clearly, the Administration has backed away from that commitment.
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    We understand that it is hard to entice other countries to contribute. It is especially difficult when you place certain governments off limits as we have apparently done with Taiwan. If KEDO desperately needs money, it will take it from anywhere, including Taiwan.
    The Four-Party Talks designed to find a lasting peace on the Korean Peninsula have achieved nothing after 2 years and 6 meetings. These talks were so ineffective—and so meaningless—to North Korea that there has been great difficulty in even arranging a date for the next meeting.
    North Korea remains the No. 1 proliferator of ballistic missiles and enabling technologies, primarily to Pakistan, Syria, and Iran. A few weeks ago, North Korea fired a Taepo-dong medium range ballistic missile over our allies and service men and women in Japan. We believe the North Koreans will soon be selling this weapon to Iran and to other irresponsible nations.
    We have achieved very little other than talk. The Korean Peninsula is no less tense today than it was 4 years ago. North Korea continues its armed provocations against South Korea in the form of incursions by submarines, special operation forces and tunneling under the DMZ.
    There have been no significant military ''confidence and security building measures.'' North Korea may be continuing its nuclear program. It has made great strides in its missile program. North-South dialog is nonexistent and the North Korean People's Army still stands as one of the largest in the world with a force of over 1 million personnel.
    Moreover, North Korea achieved its long-term goals of canceling U.S. military exercises such as ''Team Spirit''; removing U.S. nuclear weapons from the peninsula; easing political and economic sanctions; dealing directly with the United States while minimizing contact with South Korea and receiving massive food aid—500,000 tons this year alone.
    This generosity and expression of goodwill toward a brutal Stalinist police state has led North Korea to believe that there is no cost to continuing its nuclear program; the proliferation of weapons; incursions into the South; the firing of ballistic missiles; the abuse of human rights; starving its people to feed the party and its military; the trafficking of narcotics; and the counterfeiting of American dollars, not to mention the threat to the lives of 37,000 American service men and women who are serving in South Korea and some 47,000 serving in Japan.
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    Holding out for North Korea to collapse is not a sound basis for any policy toward Pyongyang. It is high time to build our U.S.-North Korea policy based on political strength, military deterrence and reciprocity; no small task, but something that could be done without delay.
    First, we should inject some new thinking into our new policy. The Administration presents us with a false choice: support the Agreed Framework or go to war. That certainly is a false dichotomy. We need some fresh thinking on this issue. We are calling on the Administration to appoint a bipartisan blue ribbon commission to conduct a zero-based review of our North Korea policy and propose a course of action which takes into consideration new perspectives on the nuclear and missile threat. The Rumsfeld Commission on the ballistic missile threat, which has been tremendously successful in this regard, could serve as a model for what you are suggesting.
    Second, the Administration should get serious about Theater Missile Defense (TMD). It must be made a national defense priority. Diplomatic initiatives should be accompanied by a firm commitment to protect our troops in the field. TMD will go a long way toward ensuring that.
    Third, we should consider appointing a high-level envoy or a small group of envoys to negotiate solutions to the problems which confront us. A high-visibility, senior-level envoy could work with our allies to reinforce military strength, research on missile defense and to unify our approach to the North. Perhaps we should renegotiate the 1994 Geneva Agreed Framework in order to address its significant shortcomings. This senior envoy, with a senior North Korean counterpart with real access to senior North Korean decisionmakers, could perhaps make that a reality.
    The nuclear and missile problem is no longer limited to the Korean Peninsula. It is a threat to East Asia and possibly our Nation. We must not be so wedded to an outdated policy that we cannot see its shortcomings. Only hard-nosed, well-considered diplomacy and U.S. military superiority will ensure continued peace and stability on the Korean Peninsula.
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    [The prepared statement of Mr. Gilman appears in the appendix.]
    Chairman GILMAN. I think we have assembled an outstanding group of panelists today to address these issues and others. We look forward to their testimony and to their recommendations. I want to thank them for coming.
    To Mr. Rohrabacher for an opening statement. We are being called to the floor for a vote, we will try to continue. Mr. Bereuter has gone over. We will try to come back so we don't have to break up our testimony. Mr. Rohrabacher.
    Mr. ROHRABACHER. Thank you very much, Mr. Chairman.
    Certainly, we can't sit around and wait for the North Korean regime to collapse, if we are propping up the North Korean regime. What kind of nonsense policy do we have where we are giving money to a regime that we hope goes away? China continues to proliferate to North Korea and North Korea continues to proliferate weapons of mass destruction and terrorism to terrorist states around the world.
    North Korea continues to develop missiles of its own and nuclear weapons. It is belligerent toward Japan, toward South Korea, toward the United States. The repression level in North Korea puts it into competition for perhaps the most repressive nation in the world. And any money that we give to North Korea and its own limited resources are squandered on weapons, weapons that are aimed at killing the friends of the United States of America, if not the American soldiers that are in South Korea.
    We are subsidizing that regime. That is the most nonsensical program that I have ever heard of. I have never heard of a policy that makes worst sense than that. Our policy shouldn't be giving food and giving aid and trying to make life happier for a regime that encompasses all of the traits that I just described, a repressive, brutal, belligerent Communist regime.
    Mr. Chairman, when it comes to Korea, our goal should not be the status quo, it should not be stability; our goal should be the overthrow of that government and the replacement of that government with something that is more consistent with the democratic values our country is supposed to represent, as reflected in Japan and Korea and other countries of the region.
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    I am, unfortunately, going to have to participate in the debate on the floor that is going on right after we get out of here, when Mr. Bereuter comes back. I am sorry that I cannot be here to go back and forth with the witnesses, because I am sure that there is some reaction to some of my statements. But there are many people in the United States, when they find out about what our policies actually are, that are just scratching their head and saying, how could anybody ever go home with policies like that?
    So I would like to say, Mr. Chairman, I applaud your leadership. Your statement was very well said. And I hope that they pay attention to the points that you were making, especially about missile defense and the other points that you are making in your opening statement.
    Thank you very much.
    Chairman GILMAN. Thank you very much, Mr. Rohrabacher.
    With that, I would like to welcome once again our first panel. It will be led by Ambassador Charles Kartman, Special Envoy for the Korean Peace Talks in the Bureau of East Asia and Pacific Affairs, Department of State. Ambassador Kartman, we appreciate your efforts to keep us informed of your extensive efforts in North Korea. We have had a number of conversations and meetings with you over the last several weeks, and I know your task is a difficult one.
    Next to Ambassador Kartman is Dr. Kurt Campbell, Deputy Assistant Secretary of Defense for East Asian and Pacific Affairs. Dr. Campbell, we look forward to your testimony on our Department of Defense concerns and policies, and we welcome closer consultation between you and your staff and the staff of our Committee. I am concerned, though you appear before this Committee often, we don't hear enough from OSD Policy outside of these hearings.
    And rounding out the Administration panel, I also want to welcome our Ambassador to South Korea, Steven Bosworth, who happens to be in town, and a good time to be in town, and we welcome your participation, Mr. Ambassador, and look forward to your thoughts on Seoul's perspective.
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    Welcome, gentlemen. For the sake of time, we would welcome if you could summarize, or you may submit your full statement for the record, whichever you may deem appropriate. As you know, I ask Members to withhold their questions until all the witnesses on the panel have testified. I am sure that as soon as this vote is over, more of our Members will be returning.
    Ambassador Kartman, you may proceed. I have 3 minutes. I am going to ask that the Committee stand in recess just briefly until Mr. Bereuter returns, then you may start your testimony. The Committee stands in recess.
    [Recess.]
    Mr. BEREUTER. [Presiding] The Committee will come to order. Chairman Gilman authorized me to proceed with the witnesses. But I wanted to give a chance for the Ranking Minority Member, the distinguished gentleman from Indiana, to make an opening statement. I am sure Chairman Gilman will return shortly. As the Chairman of the Subcommittee on Asia and the Pacific, I am very interested in the subject. I look forward to your testimony.
    I do not have a lengthy statement to delay us any further. I will just say I am pleased that the Chairman has decided to elevate this issue to the Full Committee, and I will sure look forward to your testimony. I turn now to the gentleman from Indiana for any opening comments that you would like to make.
    Mr. HAMILTON. I thank the Chairman for permitting me to do that. I apologize to our witnesses. We had the President of Colombia with us and didn't feel quite right in kicking him out quickly. So I thought we should stay there for a while, and I regret the delay. I do want to commend Chairman Gilman for having the hearing.
    I think that North Korea probably presents us with one of the most, if not the most serious, foreign policy and national security challenges that we have now. North Korea is one of the world's last Stalinist dictatorships. Five percent of its entire population is under arms. It has the fifth largest army in the world. It is diplomatically isolated, economically exhausted, and ideologically bankrupt.
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    We are, I think, still technically at war with North Korea, and it aspires, of course, to acquire nuclear weapon arsenals that would send shock waves through Asia, the Pacific, and the world.
    In the face of all of this, the President and his Administration finds the entire thrust of their North Korean policy under fire. For 4 years, American policy toward the North has been built around the October 1994 Agreed Framework. A diplomatic deal, if implemented, it promises to rein in North Korea's nuclear weapons program. And now the basic tenets of the Agreed Framework are being challenged, not only by the North Koreans, but by Americans as well.
    That this should be the case is not surprising, because North Koreans make it very difficult to have a normal relationship with them. Indeed there are many, I am sure, who doubt we have ever had anything other than an adversarial, confrontational relationship with the North. Some would have us repudiate the Agreed Framework. They apparently believe that it is so seriously flawed as to be beyond repair. Others, while professing no intent to walk away from the Agreed Framework, nonetheless advocate policies whose implementation would almost surely lead to the termination of the 1994 accord. I think both of these groups should ask this question: If the Agreed Framework falls apart, what is your strategy, what is your policy? Specifically, how do you keep North Korea from resuming the production of plutonium and the manufacture of a nuclear arsenal?
    Before we junk the Agreed Framework, we should be very careful in our assessment of this difficult relationship. The Agreed Framework is a limited agreement. It is designed to deal with North Korea's nuclear program, not with missiles and not with other aspects of the relationship. In my view, the agreement has worked reasonably well. The judgment of the intelligence community, as I understand it at least, at this point is that the North Koreans have lived up to the agreement.
    Obviously, we need to monitor developments that are occurring there with great care and verify everything that we possibly can. But I do not think for the present that we should abandon the Agreed Framework, and I think we should meet our responsibilities under KEDO.
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    We must also ask: What are the consequences of a collapse of the Agreed Framework; what would be the North Korean response? I think it is fairly easy to answer that question.
    If we fail to live up to our commitments under the Agreed Framework, the North Koreans will have no incentive to live up to their commitments. What does that mean? That means that the North would throw out the international inspectors who, for the past 4 years, have been monitoring North Korea's principal nuclear facilities. That means that the North would begin reprocessing the spent nuclear fuel it currently possesses, a step that in a few months would give it enough plutonium for four or five additional nuclear bombs. And that means that the North would resume operation of its current nuclear reactors which can produce, each year, enough plutonium for another 10 to 20 bombs.
    Right now, according to news accounts, the CIA believes that North Korea might have one, or at most two, atomic bombs. So if the Agreed Framework collapses, the North in a matter of months would be able to increase its nuclear arsenal from 1 or 2 bombs to 5 or 7. And each year thereafter, it could increase its nuclear arsenal by another 10 or 20 bombs.
    The issue is not whether we like North Korea or whether we trust North Korea or whether we are happy about recent North Korean actions, nor is it the issue whether the Agreed Framework has solved all of the problems of the North. It of course has not. The issue is how we can best advance American interests, how we can keep the North from developing a large nuclear arsenal, how we can maintain peace and stability on the Korean Peninsula, and ultimately, of course, how we can safeguard the lives of 37,000 American soldiers stationed on that peninsula.
    As we wrestle with these important policy questions today, I hope Members will ask themselves the following questions: Are we better off if the Agreed Framework falls apart? Are we better off if North Korea resumes an all-out nuclear weapons program? If, as I think it must be, the answer to these questions is no, then I hope Members will allow these fundamental realities to guide their consideration on the policy issues that we will be discussing today.
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    Mr. Chairman, I apologize here for being late to the meeting. I think you know we had the Colombian President with us, and I thank you for giving me the opportunity to make this statement. I look forward to the testimony.
    Chairman GILMAN. [Presiding] Thank you, Mr. Hamilton.
    Mr. Kim.
    Mr. KIM. Thank you, Mr. Chairman, for yielding. I do have an unprepared and unwritten statement I would like to make, Mr. Chairman. I do have some serious concerns about this North Korea. I am glad you made this hearing possible today. I hope I can learn quite a bit about North Korea today.
    One of the concerns I have is the assurance issue. I have heard about this many, many times. Yet I saw an extravagant inauguration ceremony the other day for Kim Jong Il. It doesn't look like they are starving people. As I was wondering a couple years ago, if they were so starving that they are going to collapse any minute, why are they are still there?
    As for the missile satellite situation, we were told that there was a missile, then we were told it was a satellite. A missile is actually hostile behavior, but the satellite isn't. The satellite can be considered a kind of scientific research. And I don't understand this.
    And, finally, $200 million compensation for not selling nuclear weapons to hostile nations. Are we accepting this? What happened to the Four-Party Talks; how come we are not hearing anything about this anymore, that Four-Party Talks have been initiated by this Congress?
    What happened to the liaison offices? I have been hearing all the time, all of a sudden it was a dead issue. Drug trafficking and counterfeiting, I have been hearing every day; what is happening? Are we doing anything about this? Does China play? How come China is so quiet about this issue, acting like there is somebody else acting on this issue? China is right there near North Korea; how come they are not picking part of this dilemma?
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    KEDO funding. We talk about cutting back the KEDO funding or not even allowing any KEDO funding. What is going to happen to that? Isn't that an agreement we reached quite some time ago? Is it right to cancel the KEDO funding or delay it? What happened to all of these policy objectives? What is our overall objective anyway toward the Korean Peninsula?
    I read an article this morning that last week there was a seminar sponsored by the International Asian Center, with one speaker named Brian Baker and several other speakers, former staff from the Carter Administration. They insist that we withdraw our troops from Korea in order to have the Korean Peninsula be united. I don't understand this Administration's policy. Is that a new direction? I mean, I have a lot of questions.
    I am glad to have this hearing today, Mr. Chairman.
    Chairman GILMAN. Thank you, Mr. Kim.
    Mr. Ackerman.
    Mr. ACKERMAN. Thank you very much, Mr. Chairman, for holding this hearing. Mr. Chairman, as we all know, on August 31st, North Korea escalated tensions in northeast Asia by testing a two-stage ballistic missile which plunged into the Pacific Ocean beyond Japan. Regardless of whether the launch was a missile test or an attempt to put a satellite into orbit, it clearly indicates that North Korea's ballistic missile program is further along than many of us have thought.
    It also raises serious proliferation concerns about whether North Korea will attempt to sell this missile technology to Pakistan or Iran. While these are legitimate and serious concerns, the response of the House last week zeroing out the funding for the Korean Peninsula Energy Development Organization is, I strongly believe, inappropriate.
    As my colleagues recall, the 1994 Agreed Framework had as its centerpiece the halting of North Korea's nuclear weapons program. This central achievement remains intact. My colleagues will also recall that the Agreed Framework did not address missile proliferation, although the Administration rightly continues to press the North on this crucial question.
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    A more direct threat to the Agreed Framework is the report that North Korea is constructing an underground nuclear facility.
    But these reports have yet to be confirmed, and until they are, we should keep our commitment to KEDO by providing the $35 million the Administration has requested. Not providing the money will undermine the progress we have made in freezing the North Korean nuclear program and will only confirm the North Korean view that we never intended to provide the heavy fuel oil anyway. It doesn't seem to me that this is the way to get further cooperation from North Korea.
    Mr. Chairman, I hope that as the conferees work on the foreign operations bill, they will restore the money for KEDO because, as Ambassadors Greg and Lilley have said, without it we would be back at ground zero in our dealings with Pyongyang and with mutual suspicions at dangerously heightened levels.
    I thank the Chairman.
    Chairman GILMAN. Thank you, Mr. Ackerman.
    We are pleased that we are joined today by the Chairman of the Policy Committee, the gentleman from California, Mr. Cox. By unanimous consent, we will request Mr. Cox—if he has an opening statement.
    Mr. COX. Mr. Chairman, thank you for an opportunity to present my views before the Committee this afternoon. As Chairman of the House Policy Committee, I have been heavily involved in assessing U.S. policy toward Communist North Korea. There is no place on the globe where the fragile peace maintained by U.S. forces is so openly threatened by a Marxist-Leninist dictatorship.
    We owe it to ourselves and to the security of our troops on the Korean Peninsula, to our South Korean allies, and to the people of North Korea to pursue a policy that limits the regime's ability to divert its scarce resources to its military buildup and to its unwise economic policies. Regrettably, the Clinton Administration's policies actually have the effect of permitting North Korea to make strides in its military program and reinforce its adherence to unsound economic policies.
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    When the Agreed Framework was first considered, Secretary of State Warren Christopher told the Senate Foreign Relations Committee that the framework's benefits would be provided ''after we have had an opportunity to judge North Korea's performance and its intentions.'' He promised the light water reactors would not be provided ''until North Korea fully complies with safeguard obligations, which includes accounting for its past activities.''
    Even before reaching the final stage of the process, however, North Korea has already blocked inspections. It has delayed the canning of spent fuel rods and it has made it impossible to trace past activities. Nevertheless, the United States has already provided $105 million to North Korea for heavy fuel shipments and other benefits under the agreement.
    The Agreed Framework has failed to achieve U.S. security objectives. Part of this is because of North Korean intentions, but part of it is because of the agreement's flawed design. Its emphasis on light water nuclear reactors was always bad economics. For North Korea, light water reactors is an expensive and dangerous means of producing electric energy.
    Light water reactors of this size will generate an electric load that North Korea's antiquated power grid cannot handle. The light water reactors will be expensive to run, nearly impossible to maintain, and prone to failure. Electric power experts have pointed out that providing distribution capabilities, a need that was not covered in the Agreed Framework, will cost an additional $1 billion at a minimum.
    Providing light water reactors was also unwise in terms of nonproliferation objectives and other security concerns. The Clinton Administration considers light water reactors intolerably dangerous in other parts of the globe because of their potential for the proliferation of nuclear material. It has vehemently protested a Russian transfer of light water reactors to Iran. Nuclear arms experts have pointed out, because of their size, the light water reactors can produce more weapons-grade plutonium at a faster rate than the nuclear plants North Korea promised not to build.
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    The reactors may be ''proliferation-resistant'' in the sense that it is harder to extract the weapons-grade material from them, but North Korea has the same capability that Iran has to be able to perform that technical task.
    Likewise, North Korea has made tremendous strides in missile technology since 1994. It has developed and deployed No-dong missiles for use in South Korea, Taepo-dong I missiles that are capable of striking U.S. forces in Korea, Japan, and Guam and longer-range Taepo-dong II missiles that will be able to reach Alaska and Hawaii.
    In the past year, North Korea has provided missile technology to Iran and Pakistan. It has facilitated the tests of Pakistan's Ghauri on April 1st and Iran's Shahab missile on July 21st. Jane's Defence Weekly claims that after both tests, data was sent back to Pyongyang to aid in the development of the missile it launched over Japan in August. This kind of technology networking is precisely what the Rumsfeld Commission predicted could speed missile technology exchanges.
    Meanwhile, the United States is subsidizing North Korea as it adheres to the same devastating economic and agricultural policies that reduced Stalinist Russia and Maoist China to mass starvation, and these same collectivist policies have now led to the same result in North Korea while the regime spends over $5 billion dollars annually on its war machine.
    An important defector from North Korea's inner circle has asked us to stop providing food aid. Former Secretary General of the Workers Party, Hwang Jong Yeop has said, ''North Korea controls people with food—the food distribution is a means of control.'' American food aid has been found in both of the submarines that have recently been discovered in South Korean waters during North Korean commando infiltration missions.
    Last year, Representative Tony Hall and I successfully offered an amendment to the fiscal year 1998 agriculture appropriations bill that required that our aid be provided, and I quote, ''by the U.N. World Food Programme or private voluntary organizations, and not by the Government of the Democratic People's Republic of Korea'' That has been our law. Yet, can anyone doubt, when food aid is discovered in North Korean submarines on terrorist missions, that this condition of the law has been flouted by the Administration?
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    On August 6th, Members of the House, including Chairman Gilman, Chairman Hyde, Chairman Livingston, Chairman Solomon, Representative Skeen, and myself, wrote President Clinton to insist that food aid to North Korea continue only with adequate safeguards against misuse. In particular, Congress must have confidence that food aid has not been and will not be diverted to military use.
    Finally, in order to guarantee that U.S. policy is not susceptible to North Korean blackmail, extortion, and threats of war, U.S. forces and our allies must be strong and well-defended. The Administration should take immediate steps to correct whatever vulnerability it believes we may have to North Korean belligerence. Congress has a clear record of support for measures necessary to strengthen U.S. and allied forces in Asia.
    The Administration should accordingly undertake measures including the following: increasing the number of troops and assets arrayed against the North Korean threat; providing Patriot batteries and other defenses against North Korean artillery to our allies; speeding the deployment of TMD systems to protect U.S. forces and entering into agreements with allies to develop an antimissile defense network and improve our early warning capabilities.
    I thank you very much, Mr. Chairman, for the opportunity to speak today.
    [The prepared statement of Mr. Cox appears in the appendix.]
    Chairman GILMAN. Thank you very much, Mr. Cox. Thank you for joining us in our Committee. We appreciate your commitment.
    Mr. Hamilton.
    Mr. HAMILTON. May I ask unanimous consent to include two articles submitted by Congressman Berman for the record?
    Chairman GILMAN. Without objection.
    [The articles appear in the appendix.]
    Chairman GILMAN. And to the panelists, we regret the delay and thank you for being patient.
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    We will proceed with Ambassador Kartman.

STATEMENT OF AMBASSADOR CHARLES KARTMAN, SPECIAL ENVOY FOR THE KOREAN PEACE TALKS, U.S. DEPARTMENT OF STATE

    Ambassador KARTMAN. Thank you very much, Mr. Chairman. It is always a pleasure to be with you. I have submitted a statement, and I will abbreviate in the interests of time.
    We all recognize that North Korea remains a potential threat to peace and stability in northeast Asia and in other areas. We recognize that the principal problems of the Korean Peninsula must be solved by North and South Korea, that it is in our interests to support them, and that we can also engage the DPRK through dialog on issues of key concern. This is a policy that is not based on trust or confidence in the North Korean regime. On the contrary, it reflects a sober judgment of how best to contain the threat of the North Korean nuclear program and other destabilizing activities such as missile development.
    Although it is a difficult task, we are convinced that we can achieve our objectives best by carefully engaging the North Korean regime, not by isolating it. This is a view that is also shared by our allies in the region, including the Republic of Korea.
    We remain convinced that firm and steadfast use of KEDO and the other channels that are open to us is the best way to obtain the results we seek with respect to North Korea both in the short and the long term. We are hopeful that the resumption of dialogs with North Korea on missiles, terrorism, the Four-Party Peace Talks, and the suspect underground construction will each result in concrete results. And we firmly believe that the Agreed Framework must continue to be the centerpiece of U.S. policy toward the DPRK for some time to come.
    Though not perfect, the Agreed Framework is still the only viable alternative we have that has a chance to keep North Korean nuclear activities in check and keep the North engaged on other matters. Without the Agreed Framework, North Korea would already have produced a sizable amount of weapons-grade plutonium. We prevented that for close to 4 years and we are committed to ensuring that this remains the case for the future.

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    This is without doubt in the interest of the United States and our friends and allies in and beyond the region. We are clearly better off with the North Korean nuclear facilities at Yongbyon shut down. To cite specifics, those nuclear facilities are under IAEA monitoring, Pyongyang has agreed as a result of this past round of negotiations to finish—to can its remaining spent fuel, and there is a team on its way there now for that purpose. And the DPRK is not reprocessing nuclear fuel. In other words, a dangerous program at Yongbyon is frozen and under monitoring.
    We have made it crystal clear to the North Koreans that we expect them to continue to live up to these obligations under the Agreed Framework. In New York, I also made it clear to them that our suspicions about their underground construction must be resolved and that access will be essential to doing so.
    Mr. Chairman, what we also seek in our present dealings with the DPRK is to avoid a return to the circumstances of 1993 and 1994, when tensions between North Korea, its neighbors, the United States, and the international community were dangerously high. To return to that state now would be particularly debilitating as Asia seeks to recover from its financial crisis. We will look for ways to reduce tensions on the Korean Peninsula, in particular, through the Four-Party Peace Talks, but we will also continue to be firm and deliberate with the North.
    There is no question that much depends on North Korean intentions and behavior. I have no illusions about dealing with the North Koreans. The outcome of any negotiations with such a regime must be viewed with skepticism until implementation is confirmed. But progress can be achieved only a step at a time.
    Finally, a word about our humanitarian assistance. As you know, Mr. Chairman, on a parallel but separate track, the U.S. Government has responded generously in pledging food assistance to meet an acute humanitarian need in North Korea. Our policy has been and continues to be not to link this assistance to our broader political concerns. By all accounts, our assistance has had a significant positive effect on the health and nutrition of those vulnerable groups that it targets, especially North Korean children.
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    I have stressed to the DPRK that adequate monitoring is a requirement for additional food assistance. While the current monitoring arrangement is far from ideal, we are confident that our assistance has reached those for whom it was intended and that there have been no significant diversions. The monitoring arrangements have been improving, and we will continue to press for greater access.
    Thank you, Mr. Chairman.
    [The prepared statement of Ambassador Kartman appears in the appendix.]
    Chairman GILMAN. Thank you, Ambassador Kartman.
    We are now pleased to hear from Dr. Campbell, Deputy Assistant Secretary of Defense for Asian and Pacific Affairs in our Department of Defense.
    Dr. Campbell.
STATEMENT OF KURT CAMPBELL, DEPUTY ASSISTANT SECRETARY FOR ASIA AND PACIFIC AFFAIRS, U.S. DEPARTMENT OF DEFENSE

    Mr. CAMPBELL. Yes. Thank you very much, Mr. Chairman. And I appreciate your comment about being in close consultation with members of your staff. I take that remark very seriously, and I can assure you we will be making further efforts to be in touch. I appreciate your encouragement on that behalf, and we take that responsibility very seriously.
    Chairman GILMAN. Thank you, Mr. Secretary.
    Mr. CAMPBELL. Let me say we submitted a statement already. And in the interest of time, let me summarize just a few points, if I can, Mr. Chairman.
    Chairman GILMAN. Without objection, the full statement will be made a part of the record.
    Mr. CAMPBELL. Thank you very much. First of all, I think we share the concerns of most of the people we have heard today in terms of facing a regime in North Korea that is deeply unpredictable and very dangerous to the maintenance of peace and stability in the Asia-Pacific region. And I would say that the United States confronts this challenge in a number of ways.

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    I want to talk first, if I can, about the unilateral steps that the United States takes, the steps that we take on our own accord. And I think the most important commitment that the United States makes to the region is a commitment to deploy very large numbers of troops. That number now is about 100,000, and we continue to maintain that level. And we will make a further statement later this year that maintains our commitment at about 100,000 for the remainder of the century and beyond.
    The U.S. public supports our efforts at maintaining deterrence in securing the peace and stability on the Korean Peninsula. Our sense is that any hope of diplomacy that Ambassador Kartman underscores rests on the reality of deterrence. And we believe that taking steps to secure that deterrence is our most important mission of the Department of Defense.
    Second, in addition to our unilateral commitments to remain deployed in Asia, particularly in Japan and Korea, are our bilateral relationships; and, again, here primarily with Korea and Japan.
    I will say, Mr. Chairman, on the issue of our joint readiness, I would say in the last 4 years our interaction with the South Korean military has increased almost exponentially.
    We have more military training, more joint exercises with South Korea, I believe, today than with any other country in the world. I urge you in your consultations; I know your staff had an opportunity to talk with our senior military officials in South Korea—over the last 5 years, we have taken steps to increase our military capabilities across the board in accelerated programs that allow us to go after North Korean artillery, increasing our air capabilities, our attack fighter squadrons. All of these efforts underscore our ability to enhance deterrence and, if necessary, fight and win a war on the Korean Peninsula.
    Last, in addition to our bilateral steps with South Korea, or our regional steps, we are working often behind the scenes with China, who has been at times helpful at the Four-Party Talks. Immediately after the missile tests, Mr. Chairman, Secretary Cohen asked us to go to China for consultations about the situation in North Korea. We urged them to take steps to put whatever pressure they could on North Korea to refrain from such dangerous and provocative steps as this missile launch.
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    We have also worked closely with Japan. I think you may have seen over the weekend that the senior Japanese officials and American counterparts, Secretary Albright and Secretary Cohen signed far-reaching agreements to cooperate, where possible, in TMD. The United States and Japan have taken steps to enhance our cooperation in terms of what are called ''defense guidelines,'' which allow the United States and Japan to respond to potential challenges on the Korean Peninsula. And last, of course, we are taking steps to increase our intelligence cooperation. So all the points that Chairman Cox has underscored, we believe we are undertaking.
    Let me just conclude with one point, if I may, Mr. Chairman. These are the traditional kinds of challenges that we face on the Korean Peninsula and that we faced for 45 years. We have a high degree of confidence that if we are tested or challenged militarily that we will be able to respond. I can assure you, however, that the damage associated with any conflict on the Korean Peninsula would be devastating.
    The other challenge that we face more recently, shall we say, are the kinds of security challenges that flow from unpredictable situations in North Korea. And those, of course, are the security implications associated with instability or humanitarian concerns. The Department of Defense has been working closely with our Korean counterparts to develop plans for how we would respond in the face of humanitarian situations which sent millions of refugees searching for food or that led to internal instability in North Korea.
    Let me just conclude by saying I think that we have had many years of alliance, military and security alliance, that is the bedrock of our relationship with South Korea. I think that if you consult your South Korean counterparts, you will find that our security relationship is as strong as it has ever been.
    Thank you very much, Mr. Chairman.
    Chairman GILMAN. Thank you very much, Dr. Campbell.
    [The prepared statement of Mr. Campbell appears in the appendix.]
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    Chairman GILMAN. We are pleased now to have Ambassador Steven Bosworth who is serving as our Ambassador in the Republic of Korea. And I might note, prior to that, Ambassador Bosworth served as the Executive Director of the Korean Peninsula Energy Development Organization, known as KEDO, and something that we are very much concerned about.
    Ambassador Bosworth.

STATEMENT OF HON. STEPHEN BOSWORTH, AMERICAN AMBASSADOR, REPUBLIC OF KOREA

    Ambassador BOSWORTH. Thank you very much, Mr. Chairman. I find myself here this afternoon without a lot of advanced preparation. I do not have a prepared statement. But I would be prepared, if you would like, to comment very briefly on some of these issues as seen from the perspective of Seoul.
    Chairman GILMAN. Please proceed. You are there on the front line; we welcome your thoughts.
    Ambassador BOSWORTH. All right. First of all, Mr. Chairman, I would note that South Korea's attention is focused at this time very heavily, not to say exclusively, but very heavily on overcoming their own economic crisis. This is, in the words of Kim Dae Jung, their President, the most severe crisis Korea has faced since the Korean War.
    So it is not surprising that they are concentrating national resources and national energy on overcoming this crisis. This hearing is not on that subject. And I won't go into detail, only to say that it is indeed a very severe crisis. And we are doing everything we can to help them get through this.
    I think there has been a significant change in South Korea's attitude and view of North Korea over recent years. And that is, I believe, that in South Korea there is now a firm view that the decades-long competition with the North politically, economically, and ideologically is over, but South Korea has won that competition. That, therefore, creates a situation in which South Korea can deal on a more confident basis with North Korea than has been perhaps the case in the past.

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    From the South Korean perspective, the essential cornerstone to any effort to deal with North Korea is their security alliance with the United States. And I might say, as Dr. Campbell indicated, they and we are fundamentally confident that we have a strong military deterrent in place, and that in the event that deterrent should fail and that there should be armed conflict on the Peninsula, we are entirely confident that we would win. We would win relatively quickly. But as Dr. Campbell indicated, there would be very serious damage done to South Korea in the process, and that is obviously an objective reality of which both South Korea and we have to take very careful account.
    So on the basis of that deterrent posture, the alliance with the United States and their own confidence in dealing with North Korea, South Korea under the leadership of president Kim Dae Jung, is engaged in an effort to try to put in place a series of opportunities for North Korea to engage with South Korea, both in the private sector and in the public sector, the underlying hypothesis being that should they engage, should they continue to develop a stake in commercial cooperation and in cultural exchanges with the South, that this will temper their behavior. In other words, it is a policy designed to induce change in the way North Korea behaves.
    I think South Korea is confident, and I believe we should be confident, Mr. Chairman, that time is on our side. This is not a regime that we are dealing with in North Korea that is undergoing any strengthening. In fact, it is progressively growing weaker. Either they change their economic policy, which implies change in their political behavior, or they will at some point fail.
    Now, when that failure might occur is, of course, beyond prediction. But I think those are the two realities that North Korea faces and the two realities that should be built into our own strategic approach to this question.
    From South Korea's perspective, the Agreed Framework has become the essential cornerstone of any strategy toward North Korea. In their view, as in ours, it has neutralized the nuclear threat from North Korea for a period of 4 years. No new fissile material has been produced by the facilities now under the freeze at Pyongyang and now under IAEA inspection. South Korea, too, is concerned about what might be the purpose of the much-discussed underground facilities in North Korea.
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    And they agree with us that we must move to satisfy our concerns. And they support us in that effort, just as they agree with us and with Japan, that we must begin trying to deal effectively with the missile question in North Korea. But they very strongly believe that we should maintain the Agreed Framework while we work our way through these questions, and that to risk the loss of the Agreed Framework would risk a very serious strategic setback in their own efforts to deal with their northern neighbor.
    I think, Mr. Chairman, I will conclude my remarks with that. I would be very happy to participate in a further discussion of this. I would only underline that, as I indicated at the beginning, South Korea is concentrating, rightly in my view, its efforts and energy on overcoming its economic crisis. Without a strong economy, the ability of South Korea to function as an effective partner in our security alliance will, over time, be at risk. Thank you.
    Mr. BEREUTER (Presiding). Thank you very much, gentlemen, for your testimony. I am going to turn now to the Ranking Minority Member, the gentleman from Indiana, Mr. Hamilton, for such questions as he may wish to pursue under the 5-minute rule.
    Mr. HAMILTON. I thank the gentleman.
    Let me begin with just a few questions which I hope can be answered briefly. Do we have any evidence that North Korea is currently producing plutonium or that it has produced plutonium at any point since the Agreed Framework went into effect?
    Ambassador KARTMAN. Mr. Hamilton, the answer to both is that we have no evidence that they have produced any or that they are producing any.
    Mr. HAMILTON. So North Korea has produced no plutonium since the Agreed Framework went into effect?
    Ambassador KARTMAN. Since the Agreed Framework went into effect; yes, sir.
    Mr. HAMILTON. Do we have any evidence that North Korea is producing spent nuclear fuel, as I understand it, from which plutonium can be extracted, or that it has produced spent nuclear fuel at any point since the Agreed Framework went into effect?
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    Ambassador KARTMAN. Mr. Hamilton, it is the same answer. We have no evidence that they are now producing spent fuel or operating a reactor, other than those facilities at Pyongyang.
    Mr. HAMILTON. All right. Now, from the standpoint of North Korea's ability to make nuclear weapons, what is the significance of those two conclusions?
    Ambassador KARTMAN. Well, what we have done, Mr. Hamilton, is to block their weapons program at a critical point, thus preventing the production of additional fissile material that can be reprocessed into plutonium which is, of course, the critical part of a nuclear device. As we have all mentioned earlier, had the Agreed Framework not been in place, had Pyongyang been in operation, had the other reactors been constructed, North Korea would today be sitting on top of a very sizable nuclear arsenal that would have changed the security picture in northeast Asia already today.
    Mr. HAMILTON. With regard to the underground facility, what can you tell us? Does that, at this point, to your knowledge, violate the Agreed Framework?
    Ambassador KARTMAN. Mr. Hamilton, I would like to be rather careful with this, because there are areas of an answer that are better dealt with in a closed setting. But at the risk of sounding too lawyerly, at this point we do not know what is in that area, but we do not have any information that indicates that they have violated the Agreed Framework at that site at this time.
    Mr. HAMILTON. And we are watching it carefully?
    Ambassador KARTMAN. We are watching it very carefully, and this is a question that we intend to get to the bottom of.
    Mr. HAMILTON. And we have talked to the North Koreans about this for some time?
    Ambassador KARTMAN. Yes, sir.
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    Mr. HAMILTON. How have they responded to us?
    Ambassador KARTMAN. Again, taking some care, because this is an ongoing discussion that has commenced but not concluded at this stage, we have told them that this is one of the most critical questions now before us; that we have very deep suspicions about their activities at that site; that we must have these suspicions satisfied and that we are not going to simply be able to accept their word on a matter of this import; that this is something that is going to require access to the site.
    They have agreed to enter into further discussions with us on getting to this, but providing us with that sort of access that we require is going to require some difficult and probably lengthy negotiations over establishing terms and conditions that are going to be satisfactory to both sides.
    Mr. HAMILTON. How likely is an attack from the North today across the parallel there?
    Ambassador KARTMAN. I will turn to DOD.
    Mr. HAMILTON. Compare it, say, with a few years ago?
    Mr. CAMPBELL. Congressman Hamilton, I would judge that North Korea's traditional military capabilities, their abilities to project for us, their motorized capabilities have declined rather substantially in the last several years because of the lack of training, the lack of food, and the lack of spare parts. I would say their artillery capabilities have probably grown across the DMZ.
    Mr. HAMILTON. Are the military tensions greater or less?
    Mr. CAMPBELL. I am sorry, I will answer it very quickly. But I want to be quite specific in this; it is an important question. Also we have talked to you about their missile developments as well. Overall, we have remarkably little communication between North and South. The DMZ is a much more dangerous area in the sense that we do not have some of the mechanisms in place for dialog in the event of a crisis, although recently we have been able to reestablish some lines of communication.
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    I would say, overall, we have seen no heightened tension, for instance, no increased North Korean military readiness associated with these missile tests. But I would argue that the DMZ and the situation across the parallel into North Korea is still probably the most dangerous place on the planet.
    Mr. HAMILTON. Finally, let me just ask you what our policy is toward North Korea. Do we seek the collapse of North Korea? Do we favor reunification of the two Koreas? Do we want a so-called soft landing? What is our policy?
    Ambassador KARTMAN. Mr. Hamilton, the answer to that requires a little bit of explanation. We do not seek their collapse, although we cannot rule that out. It is a very real possibility, given the steady decline of their economy, their ability to take care of their people, and so it is an outcome that we do have some anticipation about.
    What we do seek to do is support the Republic of Korea policy in how it chooses to deal with the ultimate future of the Peninsula. And the Republic of Korea policy has already been very articulately stated by Ambassador Bosworth. And we have sometimes, for want of a better term, called it a ''soft landing,'' but that is such an imprecise term that I am reluctant to use it in this setting.
    What I would say is that we seek peace and stability on the Korean Peninsula and support for the aims and aspirations of the Korean people for peaceful unification.
    Mr. HAMILTON. Mr. Chairman, I ask unanimous consent to insert in the record a letter addressed to me from the Minister of Foreign Affairs and Trade of South Korea.
    Mr. BEREUTER. Without objection, that will be in order. Thank you, Mr. Hamilton.
    [The letter appears in the appendix.]
    Mr. BEREUTER. Ambassador Kartman, I would like to pursue a line of questioning that was brought forth by Mr. Hamilton. I would say that, unless we have access to the underground facility by the end of this calendar year, as difficult as that is for the Koreans to accept, and then periodically thereafter, we should reach the conclusion that they are violating the nuclear framework and that they are proceeding with the nuclear program. If you do not reach that judgment as a government, then I think you are derelict in your responsibilities.
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    After the first of the year, I will regard the North Koreans as violating the nuclear accord unless we have that access.
    I would like to ask you this question. Perhaps Ambassador Bosworth would like to comment as well. Why does this Administration believe that the North Koreans would give up a nuclear development program they have been working on for 30 years for heavy fuel to light water reactors? What is there that gives us that confidence that they have the motive to keep the agreement?
    Ambassador KARTMAN. In 1994, when the two sides entered into the Agreed Framework, it was our belief then that Kim Dae Jung had determined that the only future for his country was to accept some assistance from the outside and to change its fundamental relationship with the United States, and probably with the ROK and Japan. And it was based upon his guidance that we are able to conclude the agreement, the Agreed Framework, even after he passed away.
    At this point, we are now some 4 years later and the ultimate intentions of Kim Jong Il, who now runs North Korea, are more obscure to us, I would say in all frankness. And so one of our highest priorities is to come to some sort of informed determination about what Kim Jong Il intends to do with the direction of his country.
    Unfortunately, because of interruptions in dialog, the slow pace of the improved relations, we are not very far along in reaching such a decision. But we are at a point, I quite agree with you, that we are rapidly coming to a point where we must make that kind of decision.
    Mr. BEREUTER. Ambassador, would you care to comment on this subject? I have other questions, but if you have something you would like to contribute, you are welcome to do so.
    Ambassador BOSWORTH. Very briefly, I think, Mr. Chairman, I would agree that this represents perhaps the outline of an intention on the part of Kim Il Song, and perhaps carried on by the current ruling group in North Korea, to seek a way out of this deep, dark cave that they have gotten themselves into over the years. But I don't say that with great confidence.
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    I think that there is the reason to have some belief that may be the case. But I think that it has to represent a decision that to pursue their nuclear option in the way that they were pursuing it, and continue to go down that path, was going to lead the country further in the wrong direction and could indeed at some point result in a catastrophe for them.
    Mr. BEREUTER. Thank you.
    Dr. Campbell, I am wondering if you have seen or had any formal indication that the Japanese are considering participating in a TMD program in light of the recent satellite launch over Japanese air space. I would like some assurance that if and when you receive that kind of indication from the Japanese that that indication will be shared promptly with the Congress in a proper venue.
    Mr. CAMPBELL. Sure.
    Mr. BEREUTER. I will give you a chance to respond to that, but I first want to express one concern to you. Earlier this month I scheduled a closed briefing of the Asia-Pacific Subcommittee on the North Korean nuclear issues, and the DIA was directed by the Secretary not to testify regarding the nuclear program. I don't understand that decision. I don't think it is appropriate. I expressed that concern to the Secretary just last week.
    I will wait for a response. But I would respectfully ask that the Department of Defense reconsider the hold placed on the Defense Intelligence Agency briefing on North Korean nuclear programs, as I considered that decision to be unjustified and counterproductive. We are the authorizing subcommittee. The senior Democrat and the Chairman of the Full Committee were in attendance at that briefing. We had expected we would receive it.
    There were a few people in Congress who already had been briefed on this sensitive issue, and those people handled that information responsibly, with full compliance with security safeguards. And so I don't understand the decision, and I protest that lack of willingness of DIA to come and testify.
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    Now back to the theater missile issue and the Japanese if you would.
    Mr. CAMPBELL. Thank you. First of all, Mr. Chairman, let me just go back to some of the questions that Congressman Hamilton was asking Ambassador Kartman. I will say and I think you know it from our briefing and other briefings that you and your staff have received over the last several weeks, we can answer some of these questions in much greater detail in another venue and we will of course stand ready to do so in a less lawyerly fashion, shall we say.
    Mr. BEREUTER. Sometimes apparently, but not always.
    Mr. CAMPBELL. The second point is I take your concern and I will be speaking to our Secretary later today and I will make sure that is passed on directly to him and I understand it.
    The third point is the question about TMD and Japanese interest in it. Japan and the United States over the last 5 years have been in a dialog about the purposes associated with TMD. We briefed them about what our strategy is, the kinds of technologies that we have been following and how we would employ such a system if we were to be successful in our testing and production. We have a national policy, Mr. Chairman, that if Japan would like to participate or to cooperate in a joint decision to work together toward a TMD, then we would do so. That has been briefed rather significantly over the last several years. Japan, I think it would be fair to say for a variety of reasons, has been very careful, has moved very slowly. Japan moves very slowly on a variety of issues but has been particularly inclined to look at the technology, the costs associated, concerns in the region. With the launch of the North Korean missile, there are greater calls in Japan for taking steps to address this concern. TMD is one of those issues.
    Last week in New York, our two sides represented at the Secretary level; Secretary Albright, Secretary Cohen and their two counterparts, signed the memorandum of understanding that we would proceed together expeditiously to explore whether there were areas where United States and Japan might suitably cooperate in this area. To translate that very briefly, it will be a long process. Japan is still interested in looking at how that cooperation might take form, and I can assure you that no matter how we proceed, we will be in close consultation with the Hill on this.
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    Mr. BEREUTER. Thank you, Mr. Campbell. Can you assure us there are no impediments on our side to cooperation by the Japanese with our country?
    Mr. CAMPBELL. I can tell you, Congressman, that there will inevitably be, as there always is in complex security and commercial interactions, such as the FSX fighter planes, there will always be questions about which technology can or cannot be shared. I feel relatively confident at this juncture that there is such a high precedence now being placed on TMD that we will be able to arrive at understandings with our Japanese interlocutors, should they decide to proceed, where we can cooperate in a way that will allow them to both contribute to the program and get the benefits of such a program.
    Mr. BEREUTER. Thank you. Now I turn to the distinguished gentleman from New York, Mr. Ackerman, for questions he might have.
    Mr. ACKERMAN. Thank you, Mr. Chairman. Let me just add a word of welcome to the very distinguished panel. The depth of their responses is certainly very, very gratifying and a special word of welcome to Ambassador Kartman, who I have not seen for a while since at least his new assignment.
    I would like to throw out two questions, one following up on yours, Mr. Chairman, and that is with regard to Japan, just what is Japan's policy toward Korea and what are the differences in that policy with our policy, or subtle nuances if there are no major differences, and second, a different question, basically with regard to the new great leader, Kim Jong Il, and what do we know about him any more than we might have known when he was the ''dear leader'' and what is his position besides his titles in the government relevant to the decisionmaking process?
    Ambassador KARTMAN. Thank you very much for your warm words, Mr. Ackerman, and I was hoping that you would have some comment on Kim Il Sung rather than Kim Jong Il, since you were one of the last Americans to meet with Kim Il Sung.
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    Mr. ACKERMAN. I am not a suspect I was told.
    Ambassador KARTMAN. I can't recover.
    First on Japan, I take some personal pride in having worked hard to ensure that the United States, Japan, and the Republic of Korea all had a unified policy with respect to North Korea. That dates back to 1991 when we initiated regular trilateral meetings which have continued right up to the present. Of course, Japan, indeed all three of us, have certain issues that we are more concerned with than the other two parties and in Japan's case, they have a long-running concern about certain Japanese citizens who may have been kidnaped from Japan some 20 years ago by North Koreans. And this is one of their foremost bilateral issues and it is going to have to be resolved before there is progress made toward normalization with North Korea.
    Similarly with respect to the recent missile launch, I think it is fair to say that Japan has felt that launch in a way that we and Korea could not, since the missile traveled over their territory, and so we have complete sympathy and indeed understanding for why this has generated such a hot reaction in Japan. But with respect to the principal goals on the Korean Peninsula, it is peace and security and the prevention of the proliferation of weapons of mass destruction. Japan, the United States and the ROK are all in complete agreement and we work together toward those ends.
    Your question about Kim Jong Il is far harder for me to answer because to the best of my knowledge, no American has ever met Kim Jong Il. He is still largely unknown to us. The fact that he chose not to take the title of President but instead is choosing to run the country from a position as the head of a defense commission I find discouraging, not encouraging, because of the emphasis that that places on the North Korean military. He apparently is a person who does not care to interact with foreigners. He also, as far as I know, does not care to interact very much with North Koreans since he doesn't deliver public speeches and he doesn't get out and mix and mingle as ordinary world leaders do. So this man is, whether by personal characteristics or by design, still largely an enigma, and that is all I can tell you, sir.
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    Mr. CAMPBELL. Congressman Ackerman, just to add another adjective. In addition to Kim Jong Il being surrounded by military people as being discouraging, I would just say that we also find it worrying and concerning. The only part of Chairman Gilman's statement that really struck me was his suggestion that somehow we had to get at senior North Korean decisionmakers. I have no idea who that group of people is or are. I have no idea that there is anyone except for him. There is no person in the world that we know less about. Actually I heard from Ambassador Kartman once that he has only spoken—that we are aware of—three words in public, they are the same words, basically ''hooray''. We know almost nothing about his policy, proclivities. I think, as you know, he was rumored to be a reformer a few years ago. I don't think we have seen any indication that that is the case during the last 3 years.
    Mr. ACKERMAN. Where is Kenneth Starr when we need him?
    Thank you. If I can offer a question that was suggested by our colleague on the Committee, Sherrod Brown, a question, the answer of which I am curious about as well. And that is, has China or anybody else that we know of assisted North Korea in its missile program and did China or any other country or power have a role in the recent rocket launch?
    Mr. CAMPBELL. If I may, it is clear that the North Koreans have received some substantial external support for their missile program. Much of that support came from the former Soviet Union, and there has also been some support from other countries in East Asia. What I would like to ask, if I may, Congressman, we are involved in intensive review of our information and our intelligence to get at precisely this particular issue.
    Mr. ACKERMAN. Would you like to get back to us on that?
    Mr. CAMPBELL. I would like to come back in another forum, perhaps privately and give you a sense of what we think we know.
    Mr. ACKERMAN. We would appreciate that and perhaps the Chairman of the Full Committee and Subcommittee would consider a closed-session meeting to discuss in some detail the responses to that question. Thank you very much.
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    Chairman GILMAN. Mr. Kim.
    Mr. KIM. Thank you. With your permission, I would like to ask all the questions first and then go back and seek the answer. The first question to Ambassador Bosworth—you have been explaining South Korea's point of view which I believe is very comprehensive. You mentioned time is on our side. Are you implying that perhaps by dragging out time maybe North Korea, before they have deteriorated, eventually will self-destruct? Therefore we should continue to just talk and talk? Is that what you mean, time is on our side?
    The next question is, you mentioned that you are talking to the Japanese about creating a theater missile. I understand South Korea has been completely left out. Why talk about equipping Japan with the theater missiles while leaving Korea out? Don't you think that South Korea should be involved in these talks? Don't you think they should have some kind of theater missile to protect themselves against the North Koreans' aggression? Another question I have is about the framework you mentioned. It works fine. That is what South Korea believes. You truly believe the framework agreement really works? Then why does missile technology keep advancing in North Korea? I wonder about the effectiveness of this framework agreement.
    My second question to Mr. Campbell, you mentioned that two-thirds of North Korea's 1.1 million military personnel are in position in the area and that they have substantial artillery to attack South Korea without any notice. What are we doing? They are shooting missiles, which is 3-stage rocket booster, almost the same as IBCM—all sorts of things are going on in North Korea. Are we doing anything or still just sitting back? Are we putting any military equipment out there? Are we mobilizing more personnel out there? Are we doing anything? I didn't hear that.
    The question to Mr. Kartman. You mentioned that we are carefully engaging the North Korea regime by not isolating it. We have been isolating North Korea for quite some time. Is that a new policy? Does that mean—engaging means we may lift sanctions against North Korea? Is that what you mean when you talk about engagement? What precisely do you mean by engagement?
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    My next question is why the underground construction must be dissolved. Well, I understand that underground digging is a big show. They are really not building anything; it's just a big show. We know that. If it is a big show, why do we make such a big deal out of this underground construction? Solve it as a first priority. Otherwise no more talk. Supposing they ask for money to stop digging—ask for some kind of compensation, are you going to agree?
    Those are the questions I have. Let's go back to Ambassador Bosworth.
    Ambassador BOSWORTH. Thank you very much, Mr. Kim. Let me try to respond to at least two of your questions. The one on TMD for the Republic of Korea I may pass to my friend here on my left since that is more properly within his bailiwick. But let me say what I mean when I said that there is a view in Seoul that time is on our side is that given the current set of policies that North Korea is pursuing, particularly in the economic area, given the fact that their economy today is not much more than 50 percent the size of their economy 10 years ago, that the ultimate destination of an economy on that path is fairly clear. When it arrives at that ultimate destination is very difficult to foresee.
    That is one way in which time is on our side. The alternative, of course, would be if North Korea decides to make changes in that policy which would perhaps prolong its life economically. Those changes in the view of South Koreans and my own personal view, those changes would by their very nature greatly attenuate, ameliorate, the militaristic threat that now comes from North Korea, that they would, in other words, have to be much more attentive about how they are perceived by the outside world, particularly by the Republic of Korea. They would then acquire a vested interest in preserving the ties that would result between them and South Korea, the economic ties. On the question of the Agreed Framework, does it really work, you mentioned the subject of missiles. I would only respond that the Agreed Framework was never intended to cover the question of missiles. It was designed to deal with the nuclear question. And there I think it has worked in that, as Ambassador Kartman pointed out in his testimony, for the past 4 years, and as he pointed out in his responses to Mr. Hamilton's questions, the past 4 years North Korea has not to the best of our knowledge produced any fissile material. So their nuclear threat is no greater now than it was in 1994. I think that means that it has worked.
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    On the subject of TMD, as I indicated, I would like to ask Mr. Campbell if he would like to respond to that. Simply to say, however, in passing that for South Korea, there is a missile threat short and medium—intermediate range missiles. More fundamentally of course there is an artillery threat on metropolitan Seoul coming from upwards of 10,000 artillery tubes. We have, we believe, the ability over time to neutralize those tubes, but it would take time. And in the meantime, there could be and would be substantial damage incurred in Seoul. Given the economic crisis that South Korea now faces, they have been forced to postpone, not cancel, but postpone some of their military modernization moves that they, and we, had hoped that they would be able to make. Those have now been moved downstream albeit terms of timing. But I think that same set of economic realities would come to bear on any questions such as their ability to invest in and deploy a TMD system.
    Mr. CAMPBELL. Congressman Kim, I think what you just heard from the Ambassador is exactly right. I think as you know, we now station in South Korea surrounding U.S. facilities some of our most sophisticated Patriot intercept systems. We have briefed extensively our Korean military counterparts about our efforts in developing R&D programs associated with TMD. Let's keep in mind that these are still programs in their infancy, programs that have yet to demonstrate, at least to the satisfaction of many of the people who look on possible partners, satisfaction that we will make significant progress. We, of course, have that confidence that these systems will be developed.
    If you look at the amount of money that we are spending potentially in the future on TMD, the entry fees for countries like Japan and South Korea that actually spend a small fraction of their GNP on military expenditure as compared to the United States, the entry costs are daunting. However, we believe that the benefits associated with our own unilateral development, or bilateral with other countries, of TMD that if and when those systems come to fruition, if there is still a threat on the Korean Peninsula, then that is the kind of capability that we would, I think, in principle share with our South Korean counterparts.
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    Chairman GILMAN. Ambassador Kartman, did you want to comment?
    Ambassador KARTMAN. Thank you. I will try to be brief in describing what I mean by engaging North Korea. It is the opposite of what we did in the years from 1953 until approximately 1988, when our policy was indeed to keep North Korea isolated. We didn't speak with them anywhere. If a diplomat bumped into a North Korean, we wouldn't say excuse me. So in 1988 at the time of the Seoul Olympics, in order to support then President Roe Tae Woo, we began to change and modify that policy so that we could open up a bit of a channel to North Korea. Over time, that policy became articulated as one that was designed to draw North Korea out of its isolation and change its behavior. And this gradually became embraced as the policies of our allies in the region as well, and now it is really specifically those dialogs that I described to you which are designed to address specific issues of concern to us. Terrorism, missiles, the peace process to reduce tensions on the Korean Peninsula, and now the resolving of our suspicions about their underground construction activities.
    You also asked whether it might be possible that this underground activity was just a big show and I don't rule anything in or out since I haven't been in there and I don't know what is going on, and that is the nature of what we must do. We have to find out if indeed there is something there to worry about, but I think that, as has been briefed in other settings—if it is a big show, it is a big show that has been going on for a while and at considerable effort by the North Koreans.
    Chairman GILMAN. Thank you. The gentleman's time has expired. Gentlemen, our Nation decided to give North Korea 300,000 tons of wheat. In early August Chairman Livingston and I wrote to the President saying we need unsupervised, unscheduled food aid and monitoring visits before 300,000 tons of that food is given to North Korea. Have we required those conditions of the North Koreans before the food is delivered? Any panelist willing to address this issue?
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    Ambassador KARTMAN. Mr. Chairman, the 300,000 tons are being provided in the same setting as we have provided the previous food aid. That is, through the World Food Program, through their monitoring and supervision and also through the PVO consortium, which provides additional monitors. Our view is that this provides an adequate level of monitoring and supervision, but it does not really meet the standard that you just described. I would say that that is probably not presently a realistic standard.
    Chairman GILMAN. We would ask for additional monitoring.
    Ambassador KARTMAN. Yes, we have consistently asked for additional monitors, Korean-speaking monitors, and we will press that without fail.
    Chairman GILMAN. We would hope you would be able to pursue that. Does the Administration intend to disregard our Committee's hold on the $27 million in reprogramming requested for KEDO funding for this year?
    Ambassador KARTMAN. Mr. Chairman, as you are aware, we have been engaged in the formal consultations on the 614 process. Those consultations have now concluded. We are forwarding the results to the President. As you are well aware, a number of specific objections were posed to the process itself and all of those objections have been forwarded in this report. I would say, however, that we are also reporting to the President at the same time the judgment that the alternative to providing the money on the schedule that is required by working within this fiscal year, that the alternatives are very dangerous and there is some risk of very unsafe situations developing if the Agreed Framework were to fail. So we are presenting those judgments and my personal judgment, Mr. Chairman, respectfully, is that the President should proceed with this waiver authority.
    Chairman GILMAN. Then you are suggesting the President should override the Committee's hold? Is that what you are saying?
    Ambassador KARTMAN. Mr. Chairman, I will repeat that we are providing the President with the specific objections that have been posed and the dangerous alternatives.
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    Chairman GILMAN. Mr. Campbell, there has been a lot of press discussion about the missile launch, satellite or no satellite. Can you bring us up to date whether it was a satellite or a missile launch?
    Mr. CAMPBELL. Mr. Chairman, I am not a satellite specialist. I, like you, receive the same kinds of briefings from our intelligence folks and people who are technology specialists in terms of particular missile tests. My sense is that there is a general agreement now among at least some branches of the intelligence community that this was a failed satellite test. Personally I think it is if not part—I believe it is completely irrelevant and I don't care whether it was a satellite putting in a small radio up in space or whether it was a straight missile test. The fact of the matter is that the North Koreans have demonstrated its capability to do a multistage missile that has the potential to carry a warhead a considerable distance.
    I think that we underestimated some of North Koreans' missile capabilities and what we have seen and what we have evaluated since the missile test is a source of very real concern. I think that is one of the reasons why our representatives in Geneva will press hard on the North Koreans to get more satisfaction in the realm of missile talks.
    Mr. HAMILTON. If the gentleman would yield.
    Chairman GILMAN. Pleased to yield.
    Mr. HAMILTON. I appreciate the Chairman bringing that up. We originally identified that as a missile and we had briefings up here from the intelligence community that it was a missile. And then a week later or 10 days later they say no, we don't think that was a missile. We think that was a satellite launch. You say it doesn't make a difference, but I think it does make a difference because the perception at least from those of us who don't know these fine distinctions on these various space efforts is that a missile is more threatening. And I just really don't understand why the American intelligence community would say that this is a missile launch without being sure of it and spread the view throughout all the world that the North Koreans are producing a missile that could strike wherever.
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    Mr. CAMPBELL. Congressman Hamilton——
    Mr. HAMILTON. I know you are not in the intelligence community but this is an important matter. I will tell you why it is important. When it came out that it was a missile launch, you had immediate action in the U.S. Congress to cut money from KEDO.
    Mr. CAMPBELL. Congressman Hamilton, if you will allow me, let me stand corrected. I think from a diplomatic perspective and a perspective in terms of veracity in public, you are absolutely right. I think I misspoke. What I was talking about was from a security perspective.
    Mr. HAMILTON. I understand your point.
    Mr. CAMPBELL. And the capacity and capability this kind of test presents. There is always a balance and in fact one of the points that I think Congressman Cox raised about intelligence or early warning sharing. I think you will find that there are two concerns that you will hear often in Congress and from our allies in terms of intelligence. One is timeliness. And second is veracity. Now, on this particular example, we did very, very well on timeliness, or the intelligence community. Within a matter of seconds or minutes, critical people were informed.
    Mr. HAMILTON. But they were informed wrong.
    Mr. CAMPBELL. Well, as you will find, as everyone who deals with intelligence understands that, sometimes early assessments are modified subsequently. It is another way of saying they were wrong first time out but the fact is that that is the nature of the beast and trying to explain how that works. This balance between timeliness and veracity is a very difficult one. I will tell you I think the intelligence community—I am not going to speak for them. I think they were surprised. I think some of them are kicking themselves that after looking at the preparations for this test for literally weeks, that we were not in a position to be able to predict what kind of test this was.
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    Mr. HAMILTON. Mr. Campbell, I have a lot of respect for our intelligence community. I think they have a terribly tough assignment and they do very good work. I don't mean to be overly critical but I must say a miscall like that has a lot of immediate consequences. And it is a pretty bad error, it seems to me, in terms of the intelligence information. That is my only point.
    Mr. CAMPBELL. I would only say one last thing, Congressman Hamilton. You are not the first we have heard this point from and we take it very seriously.
    Chairman GILMAN. Thank you, Mr. Campbell. Ambassador Bosworth, we don't want you to go unheeded here. As a former——
    Ambassador BOSWORTH. I was quite content.
    Chairman GILMAN. As the former head of KEDO, could you tell us why KEDO structured its operations to exceed Secretary Christopher's promise to the Congress that appropriations wouldn't exceed $30 million per annum. For example, why hasn't China, with obvious concerns about the nuclear peninsula provided any funding—what about Taiwan?
    Ambassador BOSWORTH. Well, Mr. Chairman, I was executive director of KEDO. I was not involved in U.S. policy in support of KEDO at that point. I was employed by the three KEDO governments, not just by the United States. And I tried to function as an official of an international organization, which is what KEDO was. I would say that the cost of heavy fuel oil, the total cost of the heavy fuel oil provided to North Korea was somewhat higher than I think many people had anticipated. It was higher largely because we were not able to take advantage of any cost savings that might have been achieved by buying forward in the market because we never had money to buy forward in the market. We were always operating under pressure, a budgetary pressure.
    I think that as an observer of what was going on in the funding side, I would note that I think that original expectations about funds that could be raised from other non-KEDO governments were not met. We did negotiate an accession agreement with the European Union in the fall of 1996 which resulted in their making a significant contribution to KEDO, which has helped on the budgetary side. But fund-raising efforts both by me at KEDO and by U.S. and ROK and Japanese officials in other parts of the world frankly fell short. China's position has been, as you are aware, that they are supportive of KEDO's objectives but they have elected to remain outside KEDO and to work toward what is basically a common set of objectives, but independently and through other channels. They were very interested always in what KEDO was doing, and I made it a point to keep them informed of that.
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    Chairman GILMAN. Thank you very much, Ambassador Bosworth. I want to thank our three panelists—yes, Ambassador Kartman?
    Ambassador KARTMAN. Mr. Chairman, if I could just add a word to Ambassador Bosworth's statement. In addition to the other problems in fund raising, the Asian financial crisis dried up a lot of potential financial sources in Asia. However, I am well aware of the point that you made earlier with respect to Taiwan. We began a discussion at that time and I intend to continue on that subject also.
    Chairman GILMAN. Thank you very much. Again, I want to thank the three panelists, Ambassador Kartman, Mr. Campbell, Ambassador Bosworth. Please forgive us for unduly delaying your testimony and now we will proceed to panel number 2. With that I would like to welcome our second panel headed by Ambassador James Lilley, Resident Fellow at the American Enterprise Institute for Public Policy Research. Ambassador Lilley, it is good to see you again. We welcome you. Especially the depth of experience on the Korean Peninsula that you bring to our table today.
    Ambassador Lilley will be followed by Mr. Fred Ikle, Distinguished Scholar, Center for Strategic and International Studies. Mr. Ikle is a former Under Secretary of Defense for Policy in the Reagan Administration. He has been before our Committee on a number of occasions. Welcome back, Mr. Ikle. We welcome your perspectives on our policy toward North Korea.
    Finally, we will hear from Mr. Nick Eberstadt, Visiting Scholar, also at the American Enterprise Institute. Mr. Eberstadt is a leading demographer on North Korea. He will give us hints on how the food shortage and economic implosion in North Korea is progressing. Mr. Eberstadt, we are glad you could join us today to give your perspectives on the North Korean problem.
    We welcome all of our panelists. I know many of you have appeared before our Congress before. But for the sake of time, I suggest you summarize your statements and have your full statement be entered into the record, whichever you deem appropriate. Gentlemen, you may proceed.
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STATEMENT OF AMBASSADOR JAMES LILLEY, RESIDENT FELLOW, AMERICAN ENTERPRISE INSTITUTE FOR PUBLIC POLICY RESEARCH
    Ambassador LILLEY. Thank you, Mr. Chairman. I will run through it quickly as you suggested, sir. First of all, the North Korean programs identified, documented and first acted under the Reagan-Bush Administration where it was opened up for the first time. Second, South Korea took the lead in those negotiations and came through with landmark breakthrough agreements in 1991, 1992. The United States did not relegate the South to a minor role in supporting money and manpower to this project. The United States did not pay for access to North Korean nuclear facilities and Chinese cooperation was obtained.
    The first direct meeting took place in New York in January 1992, and we insisted that if they wanted future meetings, which we knew was their objective, they would have to meet the standards of North-South dialog and challenge inspections. They didn't meet these conditions. We never saw them again.
    Let me just say a couple of things about what our people are saying. I am going to diverge from my testimony now. During my tour in 1986 to 1989 in Korea, I would say that we managed the North Korean positions north of the DMZ differently. There was less of a threat of war because we had effective deterrence and we were handling the North Koreans through the Military Armistice Commission.
    What I heard today is the threat of war has substantially increased since our Americans started dealing with them in 1993. There must have been something that went wrong between 1993 and 1994. War has become more likely by their own admission and we must deploy more modern advanced military capabilities in Northeast Asia to deal with it. I think that is the one thing we should look at in terms of the success of our KEDO negotiations.
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    What you had happen in 1993/1994 is the North Koreans launched a major onslaught on us to change the ground rules for the negotiation. They wanted to deal directly with the Americans and push aside the Military Armistice Commission because they sensed weakness and they smelled both vulnerability and a window of opportunity. They used brinkmanship tactics which we should have known all about from our dealings on the Military Armistice Commission. We have been dealing with them for 40 years. They rattled sabers, threatened war, demanded compensation, refused challenge inspections, suspended talks with the South and threatened to pull out of IAEA. What they got from all of these brinkmanship tactics, threatening war, et cetera, was the Agreed Framework with roughly $5 billion for them.
    Now, what I was hearing around this table today is: if we can get access to one cave in North Korea and it turns out it is not nuclear, then we have again solved the problem. They have, in fact, 11,000 caves in North Korea. Newsweek identified at least 10 where they could have hidden nuclear facilities. The problem is you don't know what they have because they have deliberately blocked you from challenge inspections and from getting access to nuclear waste sites that could tell you how much plutonium there is.
    So if we try to buy their terms and we sell them as basically good guys, we are playing their game. They can play the shell and pea game with us on this forever. They will try to make us prove the unknown but they won't let us get into their secret areas. They will let us get into Yongbyon, and our friends here were saying there is no more fissile material. Do we know this is happening in the 11,000 caves? We will never know. We will never know what they are doing because they have us blocked.
    And let me deal just a little bit with this problem of starving children. There isn't an American alive that wouldn't want to give humanitarian aid to starving children but I might say that in your own report done by Peter Brookes, the 9-27 schools to incarcerate wandering children looking for food in every city in Korea are not boy scout camps. This is rough stuff the way they treat their own starving kids.
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    Let us go on to one more point. I have the greatest respect for Ambassador Bosworth. He is a very effective officer. He did a very good job with KEDO, but I would like to quote ''Moby Dick'' when Captain Ahab said, ''My methods are sane, my purposes are mad.'' That very good work was done where the purposes were insane; namely, what you have pointed out, what Congressman Rohrabacher has pointed out. You are feeding a regime which is diverting its resources to threaten you. It is a vicious cycle which we have not broken. We have dug ourselves into a very deep hole that we can't seem to get out of.
    As an old intelligence man, I want to deal with one more problem where I heard some comments here which sounded almost verging on silly. We don't know anything about Kim Jong Il. Now come on. We have his mentor in South Korea who dealt with him as his rabbi for 20 years, Hwang Jang-Yop. You mean this man has told us nothing about him, nothing about his associations? We have two film defectors that came out and who were with him for years, went through his drunken parties, saw him talk. They have tapes of this and we know nothing about him? We have Russians and Chinese who saw him all the time and we can't find out? Even I found out when I was in Vladivostok a young former Russian naval officer who spoke Korean who met him and had very distinct impressions about him. The Chinese have seen him any number of times. They talked to people about him. We don't know anything about this guy? We don't know anything about his associations? I think we better go back to the drawing board on that one. Thank you very much.
    [The prepared statement of Ambassador Lilley appears in the appendix.]
    Chairman GILMAN. Thank you, Mr. Lilley. Mr. Ikle.
STATEMENT OF FRED IKLE, DISTINGUISHED SCHOLAR, CENTER FOR STRATEGIC AND INTERNATIONAL STUDIES

    Mr. IKLE. Thank you, Mr. Chairman, for inviting me. Let me first depart from my statement and summarize the rest. The discussion so far illustrates that we are in a way debating the pros and cons of appeasement. Appeasement became a dirty word at the beginning of World War II, but it hasn't always failed. Sometimes it has prevented war. Hence, we need to be careful in flatly rejecting any kind of appeasement. To be careful means we have to look at whom we are dealing with. Everybody today here appearing, Mr. Chairman, agreed that North Korea is the most awful regime we are dealing with. It has been that way for 50 years, atrocious, cruel. So that would argue against a policy of appeasement because of whom we are dealing with.

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    Likewise, the record of broken promises over the last 50 years. And despite that record, the Clinton Administration asserts that now, suddenly now, we can rely on new North Korean promises indeed to become the ''cornerstone'' of our policy for the peninsula. Also as an aside but I think a serious one, I heard that the Clinton Administration has become in a way a conveyor belt that unloads North Korean blackmail on Members of Congress saying that if the money is not appropriated for the Framework Agreement, that this could lead to war and the Members would have on their conscience the fate of our 37,000 troops in South Korea. With this kind of an attitude, we are goading North Korea to ratchet up the stakes. The result will be new missile tests, more exports of dangerous weapons, new chemical and biological weapons programs, new nuclear threats and new demands for gifts to propitiate North Korea.
    People have been saying in the previous 2 hours that time is probably on our side. It has also been reported this is a view of some people in South Korea. I don't think we can be confident about that. The more fear we show about North Korea's weapons program, the more we propitiate North Korean blackmail, the more we will eventually tempt the dictatorship of Pyongyang to launch larger and larger probing attacks against the South until one day the dictatorship may decide that it can safely launch a new major attack on South Korea by relying on its weapons of mass destruction to deter us from mounting a decisive response. This, Mr. Chairman, I think is the larger ambition that North Korea is up to. The decision before Congress now really is whether to fund the U.S. contributions envisaged by the Framework Agreement. This agreement, like all with North Korea, is full of trapdoors and easy to repudiate by North Korea without penalty.
    It has been mentioned that the agreement limited the reprocessing of the spent reactor fuel. And the spent fuel rods have been encased under U.S. supervision in steel containers, the so-called canning. They remain stored in North Korea available for reprocessing. Whenever the regime decides the time has come to build more bombs, a country that can build ballistic missiles can surely open up some steel containers to take out the fuel that has been enclosed. And this is only one of the many flaws of the framework agreement. I think Congressman Cox has illustrated, has listed, a few other serious flaws about the light water reactor.
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    Another aspect which has been barely noted (Ambassador Lilley is if course fully aware of it and has alluded to it in his summary testimony) by paying for the framework agreement and pressuring our allies to contribute billions, we purchased almost exactly the same unenforceable promise that we had purchased before. Now, I refer to the Joint Declaration of 1991. In 1991, we scaled back our military exercises, Team Spirit. We announced the withdrawal of our tactical nuclear weapons from South Korea, and then North Korea signed this joint declaration where it promised it would not seek nuclear weapons, it would not separate plutonium, and it will accept nuclear inspections.
    Now, what is wrong with that agreement? It seemed to offer precisely all of the guarantees we have been trying to get since. Easy to say what was wrong. It had a worthless signature, the signature of North Korea.
    May I make a recommendation, Mr. Chairman? Congress should cease providing funds for the Framework Agreement; but since the remaining weeks of this congressional session are burdened with other demanding issues, it might be best to cope with this problem in two steps. First, in this session to scale down the funding so as to provide just interim funding as a stopgap measure till, say, next February. Second, after this interim money has expired next February or next spring, to have available to Congress and to your Committee, Mr. Chairman, a report by the CIA providing an honest technical evaluation of the ways in which North Korea can move ahead with its nuclear weapons program by taking advantage of the limitations and loopholes of the Framework Agreement, including the underground facilities, all of them. Second, a report by the Department of Defense to update the assessment of the existing and required military capabilities to defeat any kind of North Korean aggression, including measures needed to deter or cope with North Korean use of chemical-biological weapons and to deter nuclear weapons. This kind of information and the partial funding that lasts only till next February, Mr. Chairman, I think would help Congress to work with the Administration next year to shift U.S. policy toward North Korea from escalating blackmail payments to a reinvigorating deterrent posture.
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    Thank you, Mr. Chairman.
    [The prepared statement of Mr. Ikle appears in the appendix.]
    Chairman GILMAN. Thank you, Mr. Ikle. Mr. Eberstadt.
STATEMENT OF NICHOLAS EBERSTADT, VISITING SCHOLAR, AMERICAN ENTERPRISE INSTITUTE FOR PUBLIC POLICY RESEARCH
    Mr. EBERSTADT. Thank you, sir. Mr. Chairman, I will summarize my remarks. I would also like to request that some of my studies be entered into the record.
    Chairman GILMAN. Without objection.
    [Due to the tremendous amount of material involved, the reports mentioned above will be kept in the Committee files and can be seen upon request.
    Mr. EBERSTADT. Today I have been asked to discuss the state and prospects of the Democratic People's Republic of Korea for offering my own analysis. I should emphasize that all outside analyses of the North Korean economic conditions are severely limited by lack of understanding about that system and the lack of information about it. Consequently, the judgments I share with you today should be understood to constitute judgments. They should hardly be taken as the final word on the matter.
    With those caveats in mind, I would offer the Committee four observations.
    First, while North Korean authorities now acknowledge that their economy is in perilous straits and admit to both steep declines in output and the emergence of starvation, they insist these crises are due to factors beyond their control. In particular, they blame their current economic difficulties upon the collapse of the Soviet bloc in 1989 to 1991 and on a series of freak natural disasters, floods, tidal waves and the like from 1995 onwards. But contrary to protestations by Pyongyang, neither bad weather nor bad luck can explain away the disastrous performance of the contemporary North Korean economic system; in the main, that the economic system has been battered and continues to be battered by self-inflicted injuries.
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    Indeed, when one reflects on Pyongyang's distinctive approach to economic affairs: its insistence upon underwriting an astonishing degree of militarization; its penchant for ''planning without facts''; its fetish for what it labels investment irrespective of the productive returns of such expenditures; its continuing attempt to delink price relations from resource allocation decisions and its largely successful attempt to demonetize its domestic distribution of goods and services; its protracted war against its own consumers; its tendencies to treat all foreign loans as concessionary donations, and its allergic reaction to generating export earnings, it is not difficult to understand the pattern of economic failures the DPRK has thus far experienced.
    The Soviet collapse and adverse weather conditions to be sure were negative, not positive, influences on recent North Korean economic performance. But they do not explain the dismal long-term trends that have gripped the North Korean economy any more than the eruption of the volcano at Pompeii accounted for the decline and fall of the Roman Empire.
    Second, although a variety of changes in rules and practices within the North Korea economy can be identified, this corpus of changes cannot accurately be described as constituting a serious movement toward policy reform, at least as that term is understood in the West.
    North Korea watchers have taken note of the number of developments that seem to betoken the measure of economic relaxation or economic pragmatism on the part of North Korean authorities in recent years. It is one thing to acknowledge that these steps and others represent a distinct change in the official policy and practice and quite another to divine their significance. While these signs of movement may seem noteworthy, they beg the question of intent. Should these changes be viewed as the beginnings of a conscious and deliberate redirection of policy or are they simply concessions to exigence as a brittle policy sags under the weight of its own troubles?
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    It is not even clear that North Korean leadership today would understand how to go about embarking upon a new economic direction even if they were so inclined. Let me mention an anecdote. Earlier this year, an official from the World Bank visited North Korea and met with senior decisionmakers in the fields of banking, finance, and foreign trade. In the course of his meetings, his interlocutors asked a number of arresting questions. At one point a top economic official asked him briefly to explain the difference between ''macroeconomics'' and ''microeconomics''. On another occasion, he had to define the terms ''market economy'' and ''centrally planned economy.''
    North Korea's current leadership might quite possibly be more economically naive than any other leadership configuration to govern a country in the period since World War II. Such economic innocence tends to encourage resistance in the face of crisis, not least by confounding diagnosis and prescription.
    Third, however bizarre North Korea's economic approach may appear to those in the outside world, I would suggest it is nevertheless governed by an internal logic, albeit a logic with which Westerners are almost entirely unfamiliar. For the DPRK's economic strategy is subordinated to its political strategy and its political strategy operates according to priorities and imperatives that are not in keeping with international sensibilities. An overarching political priority for the North Korean project, for example, is the quest to unify the Korean Peninsula on its own terms that is to say, under an independent socialist state governed from Pyongyang. North Korea's military investment policies, its trade policies and other aspects of its economic policies devolve directly from that imperative. Similarly, Pyongyang's self-conception as the vehicle of destiny for a long aggrieved Korean people directly influences the government's approach to international economic relations. That predisposition may help to explain North Korea's continuing concentration upon eliciting aid from the outside world and its parallel disinterest in developing avenues of mutually beneficial international trade.
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    And finally, it may be worth observing that severely beleaguered economies can collapse. An aphorism circulating in certain circles in Washington today has it that ''governments collapse, economies don't.'' That aphorism is disproved by events within living memory. In 1945, the economies of both Germany and Japan collapsed before, not after the collapse of their wartime regimes. Though economic collapse is an evocative and imprecise term, one useful definition involves the breakdown of a country's food system, the dissolution of rules and arrangements by which people trade their own labor for food. Those rules and arrangements broke down in both Germany and Japan before the end of World War II. In consequence for millions of ordinary people, life became a terrifying daily hunt for food. Since city people are poorly situated for such a hunt, a great deurbanization commenced. Levels of urbanization in both West Germany and Japan did not reattain their previous levels until years after the war.
    It is too soon to say whether North Korea will eventually suffer an economic collapse of its own. We must note, however, that economic collapse per se is not a theoretical impossibility. And that North Korea's current economic trajectory smacks of the perilous and unabated economic decline that has yet to be seriously addressed by the country's leadership. Thank you.
    [The prepared statement of Mr. Eberstadt appears in the appendix.]
    Chairman GILMAN. Thank you, Mr. Eberstadt. Ambassador Lilley, do you believe that North Korea would abandon their nuclear program or do you think they would continue covertly to develop a nuclear weapons capability?
    Ambassador LILLEY. I don't think there is any question that they tie nuclear weapons development to their survival, and that is their most important consideration beyond any other thing. They will keep it—since we have given them the opportunity to have a covert program, one and one still makes two. Of course they are going to do it.
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    Chairman GILMAN. Thank you, Ambassador. Mr. Ikle, what should we do about the Agreed Framework? It seems to be quite inadequate right now in freezing the North Korean nuclear program in its entirety. Any recommendation?
    Mr. IKLE. We should phase it out, Mr. Chairman. I say phase it out instead of stop it today because we have to consult with the Republic of South Korea and Japan and we have to present to many people, including colleagues of yours who have well expressed reasons favoring its continuation, why it has to be terminated. The many flaws, technical flaws in part addressed by Congressman Rohrabacher, Congressman Cox and by many studies (I mentioned one or two) show that it doesn't really contain the nuclear program. It doesn't freeze the nuclear program. It provides a thin veneer over some nuclear activities that we have been able to observe.
    Chairman GILMAN. Thank you for your succinct response.
    And, Dr. Eberstadt, I understand there are signs that North Korea's population is declining. Can you review that situation for us?
    Mr. EBERSTADT. Yes, sir. Chairman Gilman, as you know, the North Korean Government is not terribly forthcoming with statistical data to the international community. In fact, to this point, there is not a single statistical series that the North Korean Government is regularly updating and releasing on its social or economic conditions.
    What we are left with is a circumstance in which we have to infer—a little bit, like Miss Marple or Hercule Poirot in a murder mystery—about actual trends regarding demographics and other economic conditions in that country. Outside observers, the Korean Buddhist Sharing Movement, World Vision, other independent groups have come up with estimates based on their contact with ''border crossers'' from DPRK, suggesting that there has been severe and unnatural loss of life in North Korea.
    While such loss of life doubtless has occurred, it is not clear to me that one can extrapolate from those small numbers of interviewed refugees to describe precisely conditions in a large country.
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    But we do see, however, a few clues and hints, which I think are rather worrisome.
    For example, between 1948 and 1990, the North Korean Government impaneled nine successive Supreme People's Assemblies, SPAs. The North Korean constitution is obviously not a document that is followed to the very final letter. But one article within the North Korean constitution stipulates that an SPA delegate should represent every 30,000 persons in that country.
    Between 1948 and 1990, in each successive Supreme People's Assembly, even in the one following the Korean War, there was an increase in total delegates, indicating an increasing population. In the latest and most recent Supreme People's Assembly, the one convened earlier this month, however, exactly the same number of delegates was chosen as had convened in April 1990 in the ninth SPA.
    Work by myself and Dr. Judith Bannister, formally of the U.S. Census Bureau, had projected—and I should emphasize ''projected''—that population in North Korea would increase by slightly more than 3 million persons between midyear 1990 and midyear 1998. And by very rough rule of thumb, that would suggest that there should be perhaps 100 additional members of the Supreme People's Assembly impaneled in the most recent SPA as opposed to the ninth SPA. That there was exactly the same number convened in September 1998 as in the SPA of April 1990 can be interpreted in a number of different ways, of course. One may simply be that North Korean governance in the Kim Jong Il era pays even less attention to constitutional formalities than in previous times.
    Another possibility is that, however, North Korean population did not grow between 1990 and the current time, even though we would have expected an increase of perhaps as many as 3 million people, sir.
    Chairman GILMAN. Thank you.
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    Dr. Ikle, what should our policy now be with regard to North Korea? How should we handle North Korea?
    Mr. IKLE. Mr. Chairman, it is a problem a bit like confronting Stalinist Soviet Union in the deepest dark days of the cold war, only it has been going on for 50 years. But it is easier in that North Korea is a much smaller, much poorer country than was Stalin's Soviet Union.
    In short, it seems still at this time the only really viable policies is a strong deterrent force to rebuff their claims for blackmail payments, but also to work (and that we have been negligent about in the last few years), on undermining the political standing of the regime and emphasizing its illegitimacy and working, however difficult it may be, on bringing it to a speedy end.
    Chairman GILMAN. Thank you.
    And Dr. Lilley, do you have any thoughts about our policy, what it should be with regard to North Korea?
    Ambassador LILLEY. Well, I have certainly heard many times the tired and repetitive statement, ''What are the alternatives to KEDO?'' There are many alternatives to KEDO, which are much better and much improved from KEDO. I think that is the point. I agree with Dr. Ikle, credible deterrence is the first.
    I would stretch that a bit by saying that the deterrence we used against the Soviet Union, which succeeded, was massive retaliation. In the case of Korea, the point has to be made that if you ever cross into some kind of a military action, you will disappear. And this has to be delivered authoritatively and clearly established with these men.
    I think, second, you must tie your aid, whatever it is, heavy oil, food, to some kind of concrete development toward economic modernization or reform. To give them unconditional food aid is just putting it down a black hole. We have got to take our money and not put it into these great big lunatic giant reactors, but put it into fertilizer, new dams, irrigation, so somehow they can be better able to feed their people and do something that works. And I believe it has to be linked.
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    Third, I think you have got to get to this business of curbing proliferation. They have made us look like a paper tiger. And you have things happening all over the world, where people say we can trick the United States as Saddam Hussein did. India and Pakistan blew off their bombs. China keeps proliferating. These North Koreans are going to Iran and Libya with possible missiles. You have got to get a consensus in the world that this is a world problem. We have to stop the North Korean proliferation or else they will get no aid, nothing.
    Again, you must move into the North-South dialog. The South must gain dignity and take the lead on this. If the South sits and carps at us, this is what we want. It always struck me that the United States plays the role of the tough guy on this one, and if we do, this gives the South room for maneuver.
    The South can come here, and say they are trying to get the Americans to come along, and so the North Koreans owe the South one, and then get into tough bargaining. Because when the South dealt with the North, as Dr. Ikle points out, they really got progress. Agreed, it was on paper, but they made a lot more progress than we have made with KEDO. They were better at it than we were. The United States took the lead in getting reprocessing out of their agreements. My colleague, Paul Wolfowitz, pushed this very hard. But it was the South that drove the hard bargain.
    We have got to put the South up front in the center. And finally, I would say that what the North Koreans have done for the second time is to wreck Chinese plans. In June 1950, the Chinese were just about ready to take over Taiwan and Kim Il Sung said, wait, I will take over South Korea in 3 weeks and the Americans won't intervene.
    He was wrong on both counts. And Taiwan is not in the Chinese camp. Again, the Chinese have been shaking their fists in people's faces and saying you can't have TMD because that is provocative to us, and leads to the first strike against us. It is intolerable that you have it. And they have made this point very clear.
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    And now North Korea has fired the 3-stage missile over Japan and Japan may be moving ahead on TMD. South Korea also has to rethink it, and even Taiwan. So again they are a big spoiler for the Chinese. And it seems to me this offers us an opportunity as we had in 1991–92 when China moved positively in the United Nations, and in recognizing South Korea. It also did a number of other things that were helpful. Now, they sit back and watch this act that we are carrying out with the North, where the North is pushing us around. Of course, they don't want any of KEDO.
    Chairman GILMAN. Thank you very much, Ambassador Lilley, and thank our panelists.
    Mr. Bereuter.
    Mr. BEREUTER. Thank you, Mr. Chairman. Gentlemen, thank you very much for your testimony. I had a chance to read all of it before, but I understand, Dr. Ikle and Ambassador Lilley, you departed so dramatically from your written statements that I had to get a summary from the staff of what you said. I appreciate Chairman Gilman asking the basic question, what is your policy recommendations to us with respect to North Korea?
    I would like to ask all three of you gentlemen the same question—I asked this question to Ambassador Kartman. What is there which would suggest that the North Koreans would give up a nuclear development program that they have been proceeding with for now 30 years? Why should we have any confidence whatsoever that KEDO will realistically provide the framework for the elimination of the nuclear development program, especially in light of underground facilities which seem to be constructed for only one purpose? What should give us some confidence, if anything?
    Mr. IKLE. I think we should look at the KEDO arrangement as something that temporarily may slow down the nuclear development program. And we should ask ourselves why did North Korea agree to do that? Because they are getting aid for it. They are getting a massive nuclear industrial base in their country over which they will have total control once these reactors are built. And the phasing that might require a lengthier answer but there are studies on it—the phasing of the two reactors where there is no dismantling of their processing facilities, such that they are both in their hand, then they can say goodbye to the agreement—''is over'', and they have two reactors that produce plutonium, which can be reprocessed, as much as from the reactors in Iran (as was mentioned before). And they have the encased, the canned fuel rods, which they can break open in one day, and they can go back to the manufacture of nuclear weapons, which they may have continued on a small scale already in many of these underground facilities Ambassador Lilley referred to.
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    Mr. BEREUTER. Dr. Ikle, if you had to make an estimated guess today, do you think the North Koreans have stopped their nuclear development program?
    Mr. IKLE. In short, to summarize my lengthier answer before, no, they have made some concessions slowing down the visible reprocessing in order to humor us on the KEDO program so we will give them the gifts that are attached to that.
    Mr. BEREUTER. Ambassador Lilley, what are your thoughts about motives for abandoning a nuclear development program?
    Ambassador LILLEY. What I am afraid of is that the North Koreans are going to put you in the position of proving the unknown. You have to provide the proof that they are keeping their nuclear weapons program going. You aren't going to be able to do that, because they have got you blocked from inspecting it. We can't have challenge inspections. We simply can't get into the key areas. They will take us into one cave, and we won't find anything. Then we will come back and say, it is clear.
    And we will have our friends here at State saying, look, we have taken care of that problem. There are 10,999 caves left. We do have other signs of what they have been doing. First of all, you have the sign in 1994 at the time that the agreement was signed that they moved a lot of facilities out of Pyongyang. You would have to go to intelligence channels for this. I gather from my own sources that there was a shipment out of equipment from Yongbyon.
    Second, we have these explosions that have happened and that have been leaked to Newsweek now. Apparently they are carrying out these typical explosions that are used to trigger a nuclear device.
    Third, we have these underground suspect nuclear facilities that we pick up from time to time and we also get the comments from defectors that tell us that they have so many nuclear weapons. We have these indications. But the trick is to get us to prove the unknown, to persuade us to support their contentions and keep the real information back from you. We shine the light on what they want us to see so we will support their agenda. I don't know how we are going to get out of this one, because they are going to block us from seeing what we need to see.
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    Mr. BEREUTER. Thank you. I was hoping you had that answer. I am going to give Dr. Eberstadt an opportunity to respond immediately. But I wanted to say that, Ambassador Lilley, I understand the rationale that you offered for all of our assistance in the future and, in fact, the past should be tied to economic reform, agriculture reforms. But while there is always a risk that a collapsing government may go out with a nuclear or at least a warlike action, isn't there some risk in us pushing them to reform that will simply keep them as a major threat to us and our neighbors for a period of time? Is there a reason to simply let them proceed with their collapse?
    Ambassador LILLEY. Well, this argument that has been made that they will lash out if pushed into a corner has been used very effectively by them since 1993 to get major concessions from us. They have been skillful at using that.
    The other thing I point out is that they were pleasantly surprised when we as a country which they denounced daily as an enemy, offered them food, and did not check on how it was being used (whether it was diverted to their military).
    They cannot believe their own luck. They then decided that they could use our food aid, by appealing to our better instincts, to start bargaining for certain other things. I understand that this came up with talks in Geneva on missiles, that basically our 300,000 tons of grain was a tradeoff for that. And they wanted you to hold off a week so it wouldn't look linked. But they are also walking in to us and saying, 1.5 million for four-party talks, this sort of thing. Cold brutal bargaining on linkage.
    And it seems to be that we ourselves also have to use linkage by tying it to reform, but not in any crude way that could get their backs up and give them some ammunition to attack us for being extreme hard liners. They are, in fact, making appeals to somehow break out of this vise that they are in. You get from some middle level North Korean officials, that they are desperate. They were trying to get the World Bank involved and were working very hard to do this.
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    There are cracks in that system that we can work on. But as long as we do the things we are, then it will be more difficult to get at them. So if we could somehow tie the international financial institutions' support and other aid that the Chinese use, we could find people in North Korea who might respond.
    Mr. BEREUTER. Thank you. Mr. Chairman, I am aware of the red light facing me. I won't ask any questions, but I would like to see if Dr. Eberstadt has a response to my earlier questions about motivation.
    Mr. EBERSTADT. Congressman Bereuter, briefly, Professor Ikle's description of the current circumstance as a temporary slowdown in DPRK nuclear development strikes me as very apt. There are many things that I do not understand about the North Korean regime. But two things that I find extraordinarily difficult to understand is why that regime would forswear the development of nuclear weaponry, why that regime would wish to make peace with the Republic of Korea, the South Korean Government.
    The reason I say that is that it seems to me that both of those conditions would be extremely subversive of the logic upon which that regime is based. If North Korea were to give up its ability voluntarily to threaten the world internationally with nuclear blackmail, if it were to recognize the legitimacy of the South Korean Government and come to peace with that, one would have to ask, ''What then is the basis of the legitimacy of the North Korean regime? Its excellent agricultural management style? Somehow, I think not.
    So it is hard for me to imagine why a North Korean Government would voluntarily wish to relinquish the development of nuclear weapons or to enter into a significant peace process with the South.
    Mr. BEREUTER. Thank you. Thank you, Mr. Chairman.
    Chairman GILMAN. Thank you, Mr. Bereuter.
    Mr. Rohrabacher.
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    Mr. ROHRABACHER. Thank you very much. I am sorry that I have missed much of this hearing today. I was on the floor debating an issue where we are thinking about letting 200,000 foreign workers come in to take jobs in our high-tech industries. And I sort of feel it is kind of a slap in the face to some of the people that I represent who might need a job and could use the retraining or perhaps have been laid off by those same high-tech companies. So I felt compelled to participate in that debate.
    However, this issue we are talking about today is also of importance to the security of our country, and that is the safety of the people I am talking about, our constituents. I would like to ask one question and, first of all, you heard my statement in the opening statement, which is we should be trying to aim to replace and eliminate the Government of North Korea, rather than trying to find some stability for that area.
    But I would like to know if the United States had not intervened, and if we had not gotten together with China and Japan and all of these others to intervene in what was going on, and thus provide resources for North Korea, would the North Korean Government have survived by now? I mean, wouldn't we be in a much better world had we not taken the course of action that we took? That is my question to the panel.
    Ambassador LILLEY. Well, it is in a way like creating a crisis and then saying you solved it. This is what happened in 1993. The way we behaved toward North Korea probably encouraged their worst instincts. And then we are stuck with that now; we are way down deep in the hole. They have developed some bad habits about how to deal with us.
    When we look at the situation in 1991–92, it seemed to me that we were moving in a certain direction. North-South dialog was going, there were two joint agreements. The denuclearization process had just started, but we avoided getting into this business of dealing directly with the North, with Japan and Korea as our lesser supporting actors.
    Denigrating our Asian friends in this way has hurt us over the long haul. We jumped in with benign intentions, but we hadn't read the long negotiating record. We didn't know quite how to deal with the North. They pulled every trick in the book and it started working. Brinkmanship started paying off.
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    My sense is if we hadn't all jumped in then, we probably would have been better off today, but the North Korean regime still would probably be in power. They have such a ferocious system to maintain power.
    Mr. ROHRABACHER. Even though people are starving and they are—I heard the testimony earlier here, the economy can fall apart and your military can still keep on fighting like the Germans and the Japanese did.
    Ambassador LILLEY. My sense is the Chinese would have bailed them out, and the stigma would have been on the Chinese to carry the ball rather than us. They would have moved in to help us, they would not let them collapse.
    Chairman GILMAN. Dr. Ikle.
    Mr. IKLE. I agree that the Chinese would have helped the North, perhaps regarding the division of the Peninsula. But I still think for the longer term with persistent effort and careful design, we should find ways to weaken that regime and to hasten its demise. It may take another 5, it may take 10 years. Prestige is important for it, the economic aid has been, of course, very helpful to its prolonged life of which prolongation as Dr. Eberstadt has been talking and which Dr. Lilley pointed out.
    If you abstained from prolonging its life, from sending gifts—something we didn't do for Stalin in the midst of the cold war—if we undermine it, if we look for openings, for defections—a large, rich and sophisticated program, I think, would eventually cause the regime to crack.
    Mr. EBERSTADT. Congressman Rohrabacher, as you know very well, history doesn't permit instant replays, so it is very hard to say what would have happened in the 1990's, absent the support the DPRK has enjoyed from foreign patrons. I suppose I should observe that it remains something of a mystery to me how the North Korean regime goes on from day to day. It is a little bit like looking at the Confederacy in early 1865, wondering how economically this project continued. And yet it did continue for a while.
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    One can also observe that North Korean diplomacy, however strategically misguided, has been tactically very adept for decades from extracting aid from big powers, originally the game being Moscow versus Beijing. And those tactics, we now see it being deployed against Washington and Tokyo and even its mortal enemy Seoul, and this is part of the dynamic.
    Mr. ROHRABACHER. Today we heard a talk of massive retaliation or at least drawing a line that would put in place a policy of incinerating hundreds of thousands of people if that line was crossed.
    And let me just say that when we face these types of decisions in Western democracy states, the decision of killing this many people, and we know many of those people would not be our enemies but just caught in that situation, I think it almost always reflects a failure of policy on the part of an administration or a foreign policy apparatus in the United States.
    We had to retaliate against Afghanistan recently because of a failure of our Afghan policy to prevent the Taliban, these kooks, from controlling that country for the last 3 years.
    I would hate to think that because we didn't have the courage to do what was right now in the last 10 years in reference to North Korea, that some day we might be faced with a decision of incinerating hundreds of thousands of innocent people.
    Ambassador LILLEY. Let me explain something, Congressman, may I, on this ''massive retaliation''? I am not suggesting for 1 second that nuclear weapons would be used. I point out in my testimony that the model would be Desert Storm. And also the North Koreans remember very clearly what happened to them in 1951 and 1952, that they couldn't move a truck on the road because of conventional air attack.
    Mr. ROHRABACHER. Mr. Ambassador, some of us believe that Desert Storm was a result of a failure of American diplomacy.
    Ambassador LILLEY. I am getting to my next point, that the most effective way to prevent war, as we found out, is credible deterrence.
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    Mr. ROHRABACHER. We are in agreement.
    Ambassador LILLEY. Yes. And Admiral Arleigh Burke I think coined that phrase, and that if North Korea gets word in advance that their whole power base goes up in smoke, it is not worth attacking. We are not going to fight the Korean War again. It is not our plan, whatever its number, where we are going to take Pyongyang in 3 weeks, no, it is something else.
    It is a modern warfare used against them, conventional weapons, but it will be extremely punishing and it is just not worth their while, so let's think about other ways of solving their problems.
    Mr. ROHRABACHER. It would help us if, of course, we could draw the line we had a missile defense system that would prevent them from threatening some things against the continental United States.
    Thank you very much.
    Mr. BEREUTER. It would help us if we could draw the line with the Administration as well.
    The gentleman from California, Mr. Kim, is recognized.
    Mr. KIM. Thank you, Mr. Chairman, for yielding.
    I would like to make a brief statement, and then I will ask some questions. I do have some concerns, and that is to Ambassador Lilley about this situation right now that I really cannot blame North Korea, they are starving—when people are starving they will do anything, blackmail or extortion or faking it, they will do anything.
    What concerns me is our own policy, what we are doing about this. I understand these four-party talks are useless, most of the time they are arguing who is going to sit where. The North Korean delegates, they don't want to sit across the table from the South Korean delegates. After they spend the hours arguing, the only thing they will have agreed will be to have another meeting, a total useless meeting, just go on and on. Yet we call that a highly successful talk, because we agree to have another talk.
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    That bothers me. It seems to me that, from what the previous panelists mentioned, that time is on our side and this engagement policy, maybe it is all just related. Just keep talking about this thing, without having any concrete policy. It seems like we are drifting.
    I do have a slightly different opinion about the humanitarian assistance. I think we should continue that. It has been our policy, I know, that even though we have a hostile confrontation from government to government, even our enemy always helped them in case they are having a crisis. That is our spirit. I think that has been an American spirit in the past.
    North Korea is our enemy, no question about it. But because of humanitarian reasons, I think we should continue to help them in terms of humanitarian assistance. That is our spirit. But in government-to-government talks, such as the Framework Agreement, I don't know how we can't take stronger position. The agreement is drawn up between the two parties; that can be amended.
    Now, the previous panelists mentioned as well, the missile has nothing to do with the agreement, and I know that. The agreement only deals with the nuclear proliferation, but we can demand a missile clause as a part of the condition. We can attach, we can give a lot of other conditions, as you mentioned.
    That is the question to you, Mr. Lilley, what do you think about how we can deter this missile firing or stopping the missile, because the missile is more threatening to me than nuclear reactor or nuclear proliferation, because I understand they can reach California within 3 years or 2 years or 5 years, everybody agrees except as to when. And that is frightening. All they have to do is attach a nuclear warhead. That is it, it will take care of California.
    The question to Dr. Ikle, you mentioned one of your recommendations is to scale down the funding. That concerns me because the scaling down of funding tells the rest of the world that we are not fulfilling our agreement. The USA can change their mind later on and then not fulfill the agreement once you agree to it. I think we have an obligation to follow the agreement. I am not sure scaling down is a solution. But if we do that, beware, as we don't know much about North Korea and who this Kim Jong Il is. I understand he is not a rational individual.
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    Supposing they went and attacked South Korea; it could happen, they have supreme military power. If they ever attack Seoul, where one-fourth of the population is concentrated, Korea is gone. It would be a disaster to South Korea. Even though they don't win the war, what happens after complete destruction? So that is what South Koreans most fear, that is why we are walking on thin ice.
    South Korea doesn't want to intimidate or agitate Kim Jong Il by amending the existing agreement, such as scaling down the funding or reduce the amount of funding. Thank you. That is my question.
    Mr. Lilley.
    Ambassador LILLEY. Well, I really never disagree with Congressman Kim. In this area, humanitarian food aid, I will leave to my colleague, Dr. Ikle. But we cannot give it to these people unconditionally—they simply don't understand it, and they will misuse it. On the missile question, which you posed to me, first of all, we have to get some kind of an international consensus to deal with missiles.
    It can't be just the U.S. problem, it has got to be Japan, Europe, everybody, and consensus has been to be developed. And what we usually have to do is to create lures and incentives to draw them in, but that if they continue with the program, they will lose the incentives. That is one way of dealing with it.
    The second way was, which has already been mentioned, is TMD. This is an anathema to China. If we proceed with TMD with Japan, with South Korea and Taiwan, we are creating a situation for North Korea and China which is decidedly not in their interests. I am not saying we go ahead and deploy TMD, but it gives you good leverage in dealing with this situation, because the North really becomes the rogue regime, the spoiler, in that area.
    And it makes sense, because if you go to the Chinese, as we have, and say, TMD can hurt us more than it hurts you in some ways because it is so expensive, but your friend up there in North Korea to whom you give all of this aid and support, is causing great damage to your interests. They already know that.
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    And then work from that point. TMD is useful as leverage in this. Already the Japanese have moved another step in going for an additional budgetary allotment for TMD. I don't know if we eventually get TMD, but the process has already started moving Japan. And, again, this causes Chinese considerable indigestion. We would have a situation hopefully that is beginning to break our way on this, thanks to the North Koreans.
    Mr. BEREUTER. The gentleman's time is expired, but either of the other witnesses may respond to Mr. Kim if you care to.
    Mr. IKLE. Just very briefly.
    Mr. BEREUTER. Dr. Ikle.
    Mr. IKLE. The scaling down of the funding, I think, is necessary in order to get away from ratcheting up a blackmail relationship where we pay more and pay for greater and greater threats, which in turn I think feed the danger that you so properly, Congressman Kim, pointed out, the danger to Seoul and to South Korea. It is clear the dictatorship in the North wants to take over South Korea. They have wanted to do that for 50 years. That is why they attacked in 1950. They haven't given up on that.
    And the more they get equipped with food, with reactors, with economic aid, to maintain their military dictatorship, the more they feel able to threaten us, eventually to attack the South and keep us from responding in a vigorous fashion by the threat of their nuclear weapons. It is a bad situation we are in, but I think we have to climb out of this hole and not dig ourselves into it deeper.
    Mr. EBERSTADT. Congressman Kim, can I just say a word about humanitarian assistance, sir. Like you, I believe that humanitarian assistance, in principle, if possible, should be separated from security considerations given Western concerns about the value of human life in attempting to prevent unnatural increases in mortality.
    But there is a history in humanitarian relief efforts of attempting to adhere to two overriding principles. And those are the principles of nondiscrimination in distribution of relief and impartiality in the distribution of relief services and goods.
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    In North Korea today, unfortunately, I am not sure that any of the PVO's or the world food programs can honestly say that they have met those two objectives—nondiscrimination and impartiality. And as long as the North Korean regime obstructs the impartial distribution of relief food throughout that country, a big question remains over that entire effort.
    Mr. KIM. Thank you.
    Mr. BEREUTER. Thank you very much, gentlemen, for your patience in waiting through the Congressional voting schedule. Your contributions to what I think is one of the most serious national security problems that we face is very important to us, and I thank you very much for your effort and for your assistance today.
    The Committee will stand adjourned.
    [Whereupon, at 5:08 p.m., the Committee was adjourned.]

A P P E N D I X

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