In What Sense Can One Speak of Capitalist Restoration in North Korea?

 

Reply to Several Objections Raised by the Polish Comrades of “Władza Rad”

 

By Michael Pröbsting, International Secretary of the Revolutionary Communist International Tendency (RCIT), 21 June 2018, www.thecommunists.net

 

 

 

The RCIT has published two documents in the past few months in which it analyzed the political and socio-economic transformation process in North Korea. We arrived at the conclusion that the regime of Kim Jong-un has advanced the restoration of capitalism for several years. As a result, a capitalist class (the Donju) has emerged which is linked with the regime and which already controls significant sectors of the country’s economy. (1) We concluded that we can no longer consider North Korea as a degenerated workers state ruled by a Stalinist bureaucratic caste but rather as a semi-colonial bourgeois state dominated by a Stalinist-Capitalist ruling class. (2)

 

The Editorial Board of the Polish Trotskyist website Władza Rad has thankfully translated and published our latest article on capitalist restoration in North Korea. (3) The comrades accompanied our article with a brief introduction. Therein they expressed their agreement with our recognition of the process of capitalist restoration. However, they also stated their disagreement with our conclusion that the Rubicon has already been crossed. (4)

 

Here is the essential part of the comrades’ criticism: “The text contains interesting information. However, the main thesis of the article – that the DPRK has already become a capitalist state – seems premature to us. It is one thing to say that the restoration of capitalism has started in the DPRK (thesis 1). But it is another thing to state that the DPRK has already become a capitalist state, i.e. one in which the restoration has been finalized (thesis 2). The article presents evidence to support the first thesis. It shows that North Korea is pursuing a policy similar to that which was implemented in China when it was moving towards social counterrevolution. The second thesis, however, is unsustainable. Where is the private ownership of the means of production in the DPRK? Where is hereditary property? Even if the germs of the capitalist class have appeared in the DPRK, it will only become a dominant class when it can legally safeguard its privileged economic and social position. For this it is necessary to legally allow private property and inheritance, i.e. to allow freely to buy or sell a factory, as well as transfer production assets and financial assets to children. This legal pillar of the rule of the bourgeoisie is still missing in the DPRK.”

 

We have also received similar doubts and criticism from comrades of other organizations with which the RCIT is in contact. We therefore wish to reply to these arguments in this article in the hope that we can clarify this issue.

 

 

 

Has the Process of Capitalist Restoration been Completed?

 

 

 

None of our critics has disputed the numerous facts which we have provided to substantiate the RCIT’s analysis of capitalist restoration in North Korea. We therefore consider that it is not these facts which are under dispute by the comrades but rather the method with which we derive from our analysis that the Rubicon of the process of capitalist restoration has been crossed.

 

One problem in our debate is, so it seems to us, that the comrades of Władza Rad misinterpret the RCIT’s analysis of North Korea’s capitalist restoration. They write that we would assume that the “restoration has been finalized”. In fact, this is not the case.

 

We have stated both in our book on the world situation as well as in our latest article on North Korea that the process of capitalist restoration has not been finalized. In our book we stated explicitly: “This does not mean that the process of capitalist restoration has been completed. In fact, such a process usually takes a number of years. We have seen this is in Russia and even more so in China and Vietnam that it can take many years until all enterprises in the industrial and banking sector are subjugated to the capitalist law of value and until the whole working class is transformed into labor commodities. Likewise there are still many tasks for the restorationists in North Korea to complete. But the Rubicon has definitely been crossed and North Korea has to be characterized as a capitalist semi-colonial state.” (5) This argument was repeated in our article.

 

What is the difference between these the two formulations – “the process of capitalist restoration has been finalized” and “the Rubicon of the process of capitalist restoration has been crossed”? In stating that the Rubicon has been crossed we emphasize that the process of capitalist restoration, while not being completed, has already reached a new qualitative stage; a stage where a regime holds power which is dedicated to implement bourgeois relations of production and which is linked to the emerging capitalist class of Donju.

 

In other words, we are fully aware that a number of steps are still ahead in order to fully restore capitalism. Indeed, the comrades name several of them like creating the legal conditions for private ownership of factories.

 

To give a comparison: no one would deny that a new born baby still has many years ahead in order to grow and to mature as a human being. But neither will anyone deny that birth has resulted in a new qualitative stage of the embryo.

 

 

 

On the Relationship of the Regime and the Capitalist Donju Class

 

 

 

The Polish comrades raise the objection: “Where is the private ownership of the means of production in the DPRK? Where is hereditary property? Even if the germs of the capitalist class have appeared in the DPRK, it will only become a dominant class when it can legally safeguard its privileged economic and social position.”

 

It seems to us that the comrades focus too much on aspects of the ideological superstructure than on the social-economic class reality. The decisive issue to determine the class character of a state is not its legal framework but the reality of the class nature of its regime. North Korea might not formally have a bourgeois constitution. But this is rather a secondary factor if the private capitalist sector already accounts for up to half of the economic output!

 

There can be no doubt, and the comrades do not object to this thesis, that there exists a sizeable capitalist class in North Korea. No one can deny that the Kim regime has supported the emergence of the Donju class. In fact, it is closely related with it.

 

In addition to various reports which we reproduced in our past documents on North Korea, we want to draw attention to another highly informative report published by the Washington Post. This paper of the US big bourgeoisie, which is unsuspicious of any socialist sympathies, published a highly interesting article about the relationship between the party officials and the Donju. Here are a few excerpts:

 

“North Korea now has a 1 percent. And you’ll find them in“Pyonghattan,” the parallel universe inhabited by the rich kids of the Democratic People’s Republic. (…) North Korea as a whole remains economically backward — industry has all but collapsed, and even in Pyongyang, the official salary remains less than $10 a month — but the rise in recent years of a merchant class has created a whole layer of nouveaux riches in the capital city. “Donju,” or “masters of money,” have emerged with the tentative moves toward becoming a market economy that began about 15 years ago but has picked up momentum under Kim Jong Un, the third-generation leader who took over the reins of North Korea at the end of 2011. The donju usually hold official government positions — in ministries or the military, running state businesses abroad or trying to attract investment into North Korea. On the side, they trade in everything they can get their hands on, including flat-screen TVs and apartments. The money that they are making now flows through society, through the markets that are present in every population center to the high-end restaurants of Pyongyang.” (6)

 

In other words, the Kim regime does not oppress the emerging bourgeoisie as it would have been the case in a Stalinist degenerated workers state. Quite the opposite, the Kim regime has rather promoted its emergence and is linked with it. This is why we speak about a Stalinist-Capitalist ruling class.

 

The comrades of Władza Rad are mistaken to put too much emphasis on the legal issue of heredity in order to assess the class character of the state. In fact, North Korea is a model that there can be heredity without a legal framework. Just look at the top of the regime: it has been dominated by a single family clan since its foundation more than 70 years ago!

 

 

 

What is the Criterion for Crossing the Rubicon of Capitalist Restoration?

 

 

 

We have explained in our literature that the decisive criterion to assess the class character of a state is the class interests which a given regime defends. Such an understanding is crucial in order to grasp the capitalist transformation process: “When can we state that such a capitalist restoration has taken place? The answer is: when a Stalinist bureaucratic workers’ government is replaced by or transforms itself into a bourgeois restorationist government. Such a bourgeois restorationist government is one which is firmly resolved, both in words and deeds, to reestablish a capitalist mode of production, i.e., to move decisively against planned property relations in favor of creating a capitalist economy based on the law of value.” (7)

 

So we ask the comrades, do they agree that the Kim regime defends the interests of the emerging bourgeoisie in North Korea? If they do not agree, we ask them why has the regime nurtured a capitalist class for years and allowed it to take over a significant sector of the economy?! Why are so many party official s linked with the Donju?!

 

If they do agree with our thesis, then we ask why do they not recognize that North Korea has become a capitalist state? Is it because the economy is not already fully capitalist? But then, the comrades would also have to argue that Eastern Europe did not become capitalist in 1989/90, that the USSR did not become capitalist in 1991 and that China did not become capitalist in 1992. This would be the only consistent conclusion because in these years, the economy of the mentioned countries was also not dominated by a bourgeoisie. This was rather a process which took some years. However, in our analysis these countries became capitalist in the years 1989-92 because a bourgeois-restorationist government took power.

 

Our approach is based on the method elaborated by Leon Trotsky, the co-leader of the October Revolution, with Lenin, and the founder of the Fourth International. Trotsky explained in a theoretical article published in 1937 that the class character of a state and the class character of its economy can be not identical for a certain period of time. Such a period can even take years. He emphasized that the decisive criterion is which class interests does a given regime defend and not how much of its factories have already been privatized.

 

“But does not history really know of cases of class conflict between the economy and the state? It does! After the “third estate” seized power, society for a period of several years still remained feudal. In the first months of Soviet rule the proletariat reigned on the basis of a bourgeois economy. In the field of agriculture the dictatorship of the proletariat operated for a number of years on the basis of a petty-bourgeois economy (to a considerable degree it does so even now). Should a bourgeois counterrevolution succeed in the USSR, the new government for a lengthy period would have to base itself upon the nationalized economy. But what does such a type of temporary conflict between the economy and the state mean? It means a revolution or a counter-revolution. The victory of one class over another signifies that it will reconstruct the economy in the interests of the victors. But such a dichotomous condition, which is a necessary stage in every social overturn, has nothing in common with the theory of a classless state which in the absence of a real boss is being exploited by a clerk, i.e., by the bureaucracy.” (8)

 

Such an understanding seems to us to be the correct Marxist approach. The conclusion from this is that North Korea is ruled by a bourgeois-restorationist regime which is linked with the new capitalist Donju class. The country faces a similar process like China or Vietnam in the 1990s. This is why we can no longer consider North Korea as a degenerated workers state ruled by a Stalinist bureaucratic caste but rather as a semi-colonial bourgeois state dominated by a Stalinist-Capitalist ruling class.

 

We hope that this article was helpful in clarifying the RCIT’s arguments and hopefully to overcome any misunderstandings or differences.

 

 

 

Footnotes

 

(1) The literally meaning of Donju is “masters of money”.

 

(2) Michael Pröbsting: Again on Capitalist Restoration in North Korea, 12 June 2018, https://www.thecommunists.net/worldwide/asia/again-on-capitalist-restoration-in-north-korea/; Michael Pröbsting: World Perspectives 2018: A World Pregnant with Wars and Popular Uprisings. Theses on the World Situation, the Perspectives for Class Struggle and the Tasks of Revolutionaries, RCIT Books, Vienna 2018, Chapter VI. The Korean Peninsula: Imperialist Aggression, Capitalist Restoration and Revolutionary Defensism, pp. 95-105, https://www.thecommunists.net/theory/world-perspectives-2018/

 

(3) Michael Pröbsting: Jeszcze raz o restauracji kapitalizmu w Korei Północnej, http://www.1917.net.pl/node/23163 resp. https://www.thecommunists.net/home/polski/jeszcze-raz-o-restauracji-kapitalizmu-w-korei-polnocnej/

 

(4) The introduction with the critical comment can be read in Polish language on Władza Rad’s website at the same link as the one in the previous footnote. We have reprinted this introduction and translated it also in English here: https://www.thecommunists.net/forum/wladza-rad-critique-on-rcit-s-analysis-of-north-korea/.

 

(5) World Perspectives 2018, Thesis 143, p. 101

 

(6) Anna Fifield: North Korea’s one-percenters savor life in ‘Pyonghattan’, Washington Post, May 14, 2016 https://www.washingtonpost.com/world/asia_pacific/north-koreas-one-percenters-savor-life-in-pyonghattan/2016/05/14/9f3b47ea-15fa-11e6-971a-dadf9ab18869_story.html?noredirect=on&utm_term=.702cd1ae865d

 

(7) Michael Pröbsting: Cuba’s Revolution Sold Out? The Road from Revolution to the Restoration of Capitalism, August 2013, p. 54, https://www.thecommunists.net/theory/cuba-s-revolution-sold-out/

 

(8) Leon Trotsky: Not a Workers’ and Not a Bourgeois State? (1937), in: Writings of Leon Trotsky 1937-38, Pathfinder Press, New York 1976, p. 63, online: https://www.marxists.org/archive/trotsky/1937/11/wstate.htm