American pundits, politicians, policy makers, bureaucrats and military officers all need a strong injection of reality regarding the effectiveness of economic sanctions against the DPRK, and their long-term impact at a strategic level. As most rational thinkers on the subject should realize, there are few good options. However, harsh economic sanctions that exasperate confrontation and cut us out of current and future economic opportunities, as well as political and social developments, are the least productive of them all.
Admittedly I am working on the assumption that at this stage the DPRK is a de-facto nuclear state, thus we need to learn to manage it, not attempt to reverse it. A persistent unwillingness to see this, by people within the Washington policy and intelligence establishments, and a persistent state of denial amongst much of the defense community, does not help. I am not saying that we should be blasé about this situation, nor that we can not try to prevent the DPRK from obtaining crucial or otherwise sensitive materials or technology. Our efforts, while not exactly always effective, do act as a break on their technological progress in regards to both nuclear devices as well as missiles. Limited sanctions targeting such technology as well as a concerted effort by the IC to thwart such procurement, is indeed legitimate. Attempting to undermine or cripple the entire economy however, is not a productive strategy.
No doubt the nuclear and missile issues are important, as are human rights (which we seem to ignore currently) but none of these issues can be addressed in and by themselves if we want to make comprehensive progress. Instead we need to look at the entire range of issues regarding the DPRK and discuss them in totality, with our long term national and strategic interests in mind. The current focus on harsh sanctions, but with a concentration only on nuclear and missile issues, misses the more imperative interest we have in helping shape the long term economic, social and political developments in the DPRK. Our policy of strict isolation is seemingly counterproductive as it simply pushes the DPRK further into the Chinese orbit. If we have no opportunity for providing any input, how can we help shape the long-term environment? Moreover, South Korea is moving along on a path of engagement with the North, with the cost being a possible long term weakening of the South Korean-U.S. alliance (in both economic and defense terms). The U.S. is viewed as obstinate; its thinking class is seen as lacking “on the ground knowledge” and as a consequence we risk being left out at any future regional rapprochements or arrangements.
In essence; harsh economic sanctions fail to produce anything productive and only help to generate a small elite oligarch class by enriching select government officials and merchants, increasing Chinese and Russian influence and leverage, and could possibly risk rupture the U.S.–South Korea alliance. Sanctions will not help pry the DPRK open or increase our (Western) leverage or influence. In fact, they do the opposite.
The fallacy of the current policy is on vivid display in Pyongyang, from where I recently returned (elites drinking $300-dollar wines and $40,000-dollar diamond Rolexes are on gaudy display). China is simply gaining more economic influence (and Singapore, with its hard currency shopping centers is in on the game as well) at the expense of everyone else. Once the DPRK economy liberalizes (and it will, the changes year on year are apparent and investment in both consumer goods and infrastructure is clearly visible) China will be in a prime position to strongly influence and even dominate the economy of the DPRK. In effect turning the DPRK into a vassal state. Not even South Korea will be able to close this gap effectively. Thus, in reality, what our sanctions policy is doing, is blocking both our own entrepreneurs and our allies from being part of current economic activity and from being part of what I think will soon be an economic and development bonanza, that will come about from—as well as spawn further—social change. Moreover, this policy, will ensure Chinese continued dominance of the area, and possibly the region if our policies breed enough resentment in South Korea. Make no mistake about it, a liberalized North Korea, or a unified Korean peninsula, will probably not welcome a U.S. military presence–or more accurately China will ensure they do not. If we lose our foothold on the Korean peninsula, we lose not only a strategically placed ally, but also jeopardize our control of access to the open sea as well as put Japan directly on the front line, and at direct risk, forcing it to likely rearm even further. This will not help stabilize NE Asia, nor would it be conducive to peace and stability, and it would not be beneficial to our influence. Consequently, one can only wonder, is there a strategic plan behind our actions? Surely, we should be able to target specific items, firms and individuals, without blanket draconian economic measures? Hence comprehensive engagement and attempting to be part of the social and economic development fabric of the DPRK is in our strategic interest as it is the only way to ensure our ability to have any future input on developments.
As things stand now, realistically, we do not want to see a collapse of the DPRK no matter how evil, it would be massively disruptive. The best we can do, I believe, is negotiate in across the range of issues of concern (this should include human rights)—and without promising to remove our troops from the South—while also simultaneously engaging the DPRK socially and economically. Without that engagement, why would they realistically listen to us? In other words, making the DPRK reliant on China (they will not let it collapse) only serves to limit our negotiation leverage and excludes us and our allies from participating in the North Korean economy—a participation that would in-fact buy us leverage.
No doubt the DPRK is controlled by a horribly abusive government and it does not deserve the admiration nor respect of our, or even its own people, but we still need to deal with the realities at hand and we have an obligation to try to improve the situation. That means looking out for our and our allies long term interests—which at the end of the day are crucial to the future economic wellbeing and safety of the region and ourselves. If we do not do that, but instead singularly focus on twitter optics and missiles, at the expense of our long-term influence and impact on the DPRK’s development, we are not acting in our own best interest.
About the author: Nils G. Bildt, MA-IPS, is the President of CTSS Japan and has Previously Served as an Advisor to Japanese Parliamentarians and Cabinet Members Regarding National Security Issues.
But it’s difficult to think about value when we have no buoy for understanding it outside our traditional lenses: for example, our time, our job, and what others tell us they are worth in cash. This, largely, is the world’s paradigm for value so far. But understanding what value really means changes everything—and will be at the center of the decentralized revolution in global coordination that will unfold over the next decade. So, where do we begin?
Let’s start with gold.
Gold is an inherent value. When backing a market, gold allows us to grow a balanced economy well into the trillions. But why does it allow for massive stable markets to form around it? It is gold's permanence that creates stability. We understand that gold will always have value, because it is inherent in all of us, not just in one part of the world, but everywhere, not just today, but tomorrow and for the long haul.
In the 1930s when the gold standard was removed, we learned that the U.S. dollar didn’t need gold to back its economy to flourish. We learned that it was just a symbol for U.S. citizens to decentralize their coordination around the United States economy.
It turns out, common agreement is a philosophy for building shared economy.
And so it seems inherent value is a marker for us to begin exploring what the future could look like—a future beyond gold and the existing realm of credit. And so what else has inherent value? Is education as valuable as gold? What about healthcare? What about a vote that can’t be tampered with? What about an ID that can’t be stolen or erased? What about access to nutrition or clean water? You will find value everywhere you look.
It turns out, we’ve already done the legwork necessary to uncover the most elemental inherent values: The Sustainable Development Goals are commitments grown out of the drive to bring to life basic tenets of the Universal Declaration of Human Rights—the closest possible social contract we have to a global, common agreement.
We’ve already agreed.
Our agreements are grounded in deep value centers that are globally shared, but undervalued and unfulfilled. The reason for this is our inability to quantify intangible value. All of these rich, inherent values are still nebulous and fragmented in implementation—largely existing as ideals and blueprints for deep, globally shared common agreement. That is, we all agree education, health, and equality have value, but we lack common units for understanding who and who is not contributing value—leaving us to fumble in our own, uncoordinated siloes as we chase the phantoms of impact. In essence, we lack common currencies for our common agreements.
Now we find ourselves at the nexus of the real paradigm of Blockchain, allowing us to fuse economics with inherent value by proving the participation of some great human effort, then quantifying the impact of that effort in unforgeable and decentralized ledgers. It allows us to build economic models for tomorrow, that create wholly new markets and economies for and around each of the richest of human endeavors.
In late 2017 at the height of the Bitcoin bubble, without individual coordination, planning, or the help of institutions, almost $1 trillion was infused into blockchain markets. This is remarkable, and the revolution has only just begun. When you realize that Blockchain is in a similar stage of development as the internet pre-AOL, you will see a glimpse of the global transformation to come.
Only twice in the information age have we had such a paradigm shift in global infrastructure reform—the computer and the internet. While the computer taught us how to store and process data, the Internet built off that ability and furthered the conversation by teaching us how to transfer that information. Blockchain takes another massive step forward—it builds off the internet, adding to the story of information storage and transfer—but, it teaches us a new, priceless and not yet understood skill: how to transfer value.
This third wave kicked off with a rough start—as happens with the birth of new technologies and their corresponding liberties. Blockchain has, thus far, been totally unregulated. Many, doubtless, have taken advantage. A young child, stretching their arms for the first couple times might knock over a cookie jar or two. Eventually, however, they learn to use their faculties—for evil or for good. As such, while it’s wise to be skeptical at this phase in blockchain’s evolution, it’s important not to be blind to its remarkable implications in a post-regulated world, so that we may wield its faculties like a surgeon’s scalpel—not for evil or snake-oil sales, but for the creation of more good, for the flourishing of commonwealth.
But what of the volatility in blockchain markets? People agree Bitcoin has value, but they don’t understand why they are in agreement, and so cryptomarkets fluctuate violently. Stable blockchain economies will require new symbolic gold standards that clearly articulate why someone would agree to support each market, to anchor common agreement with stability. The more globally shared these new value standards, the better.
Is education more valuable than gold? What about healthcare or nutrition or clean water?
We set out in 2018 to prove a hypothesis—we believe that if you back a cryptocurrency economy with a globally agreed upon inherent value like education, you can solve for volatility and stabilize a mature long lasting cryptomarket that awards everyone who adds value to that market in a decentralized way without the friction of individual partnerships.
What if education was a new gold standard?
And what if this new Learning Economy had protocols to award everyone who is helping to steward the growth of global education?
Education is a mountain. Everyone takes a different path to the top. Blockchain allows us to measure all of those unique learning pathways, online and in classrooms, into immutable blockchain Learning Ledgers.
By quantifying the true value of education, a whole economy can be built around it to pay students to learn, educators to create substantive courses, and stewards to help the Learning Economy grow. It was designed to provide a decentralized way for everyone adding value to global education to coordinate around the commonwealth without the friction of individual partnerships. Imagine the same for healthcare, nutrition, and our environment?
Imagine a world where we can pay refugees to learn languages as they find themselves in foreign lands, a world where we can pay those laid off by the tide of automation to retrain themselves for the new economy, a world where we can pay the next generation to prepare themselves for the unsolved problems of tomorrow.
Imagine new commonwealth economies that alleviate the global burdens of poverty, disease, hunger, inequality, ignorance, toxic water, and joblessness. Commonwealths that orbit inherent values, upheld by immutable blockchain protocols that reward anyone in the ecosystem stewarding the economy—whether that means feeding the hungry, providing aid for the global poor, delivering mosquito nets in malaria-ridden areas, or developing transformative technologies that can provide a Harvard-class education to anyone in the world willing to learn.
These worlds are not out of reach—we are only now opening our eyes to the horizons of blockchain, decentralized coordination, and new gold standards. Even though coordination is the last of the seventeen sustainable development goals, when solved, its tide will lift for the rest—a much-needed rocket fuel for global prosperity.
“Let us raise a standard to which the wise and the honest can repair.” —George Washington