The not-so-good best case scenario.

Megan McArdle writes on Korean unification:

Consider another, not wholly dissimilar case. In the late 1980s, just before reunification, it is estimated that per-capita gross domestic product in East Germany was approximately 30 percent lower than it was in West Germany. Joining the two countries together temporarily multiplied their disparities. Many of East Germany’s inefficient and pollution-heavy factories were shut down, creating high levels of structural unemployment that were eased only by massive transfers and substantial migration from east to west. The problem was greatly helped by the fact that East Germany’s five states contained only 20 percent of the population of the unified Germany. Nonetheless, by one estimate, the reunification of Germany cost about 1.6 trillion euros — about $2.08 trillion.

But that project looks comparatively simple when you consider the problems that will face South Korea if its North Korean brethren start hankering for a family reunion. North Korea’s per-capita income is among the lowest in the world. South Korea’s is at least 15 times higher. Economically speaking, this is like the United States trying to adopt Haiti — if Haiti were the size of Mexico. North Korea is a country in which the vast majority of people have no access to cars, cell phones, computers, antibiotics or an adequate food supply. How do you integrate 20 million new citizens who basically missed out on the 20th century?

The brutal efficiency of North Korea’s totalitarian regime will make it even harder. Though one hesitates to praise the late-era Soviet Union, it had at least grown beyond the worst excesses of Stalinist control. By all accounts, North Korea has perfected one of the creepiest propaganda states in history. The faith in the superiority of the system — and especially the “Dear Leader” — is so high that a government website actually thought it could get away with claiming that Kim Jong Il did not defecate. It’s tempting to dismiss this as so much propaganda, but many defectors say they genuinely believed what they were told … and were shocked and heartbroken when they started foraging for food in China, and realized that even on the remote farms of Jilin province, dogs were given food like white rice and meat that ordinary Koreans hadn’t seen for years.

The whole article is worth the read. I first learned of it through her blog.


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