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This article appears in the December 27, 2002 issue of Executive Intelligence Review.

'New Silk Road' Party
Wins Korean Presidency

by Kathy Wolfe

Millennium Democratic Party (MDP) candidate Roh Moo-hyun was elected President of South Korea Dec. 19, in a narrow but decisive 49 to 46% vote, against opposition Grand National Party (GNP) chief Lee Hoi-chang, a victory for the New Silk Road and Eurasian Land-Bridge. Roh won by calling for dialogue with North Korea, and opposing calls from Lee for economic sanctions over Pyongyang's nuclear program. "I am the only candidate who can resolve the nuclear issue through dialogue. The survival of 70 million Koreans is at stake," Roh said on Dec. 15.

Roh also, as President Kim Dae-jung has done, criticized demands for sanctions and other confrontations with the North, from the minority "Utopian" faction in Washington, while making it clear that mindless anti-Americanism will not do. "I don't have any anti-American sentiment, but I won't kowtow, either," he told a rally on Dec. 17.

The election shows that South Koreans, traditionally pro-American, have nonetheless rejected recent interference in Korean affairs by kooks such as Defense Policy Board (DPB) chairman Richard Perle, and by Defense Secretary Donald Rumsfeld. This included the seizure of a North Korean ship on Dec. 11, an attempt to split Roh's campaign in half, and a public warning by Perle to South Korea, on Election Day, to prepare for war.

EIR Founding Editor Lyndon LaRouche, candidate for U.S. President in 2004, in a Dec. 15 statement distributed in Korea, exposed the "destabilization of the South Korean election campaign." He said that "attempts by ... 'Chicken-hawks' such as Richard Perle to trigger a war-like crisis in the Korea Peninsula, must be stepped on, hard," by cool heads in Washington.

North-South Highway Opens Christmas Day

Meanwhile on Dec. 18, Seoul Unification Ministry officials just back from talks in North Korea, told the press that the west coast Kyongui Line (Seoul-Pyongyang-Shinuiju) of the Trans-Korean Railway will be complete by the end of December, or the end of January at latest if technical problems arise. The four-lane highway along the Kyongui Line across the DMZ, he added, will open Christmas Day. Heavy equipment, construction materials, and South Korean officials will travel the road overland for the first time since 1950 into North Korea, for a ground-breaking ceremony of the new joint North-South Kaesung Industrial Complex, scheduled for Dec. 28-30.

This development of the New Silk Road in Korea, which is pivotal to the entire Tokyo/Pusan-to-Paris Eurasian Land-Bridge, could have been endangered if the opposition had been elected and cut off economic relations with the North. Pyongyang's failure to respond to President Kim's Sunshine Policy, until a sudden agreement to open the DMZ in September, put opposition leader Lee Hoi-chang far ahead in the polls most of this year.

But in the last weeks, the South Korean public grew so outraged over attacks on Korea's national sovereignty, that such attacks from Washington only "blew back" into the Utopians' faces. Over 300,000 people joined candlelight vigils across the South on Dec. 14, protesting the recent U.S. court acquittal of soldiers who killed two Korean girls in an armored vehicle accident. The U.S. President's Jan. 29, 2002 "axis of evil" speech was seen as an insult to the entire Korean nation. "The issue is not anti-Americanism," a vigil leader told CBS News. "We all have great respect for America! The issue is respect for the Korean people and the sovereignty of Korea. We're not the 51st state."

A Dec. 16 Korea Times column by Dr. Kim Sang-woo, chief spokesman for President-elect Roh's campaign, warned, as did LaRouche, against Utopian threats to North Korea, which are not the policy of President Bush, and which "will certainly not serve the national interest of South Korea." Dr. Kim, a former diplomat, called instead for the economic development of Asia based on the Trans-Korean Railway and the New Silk Road. Excerpts from his column, "Challenges Ahead for Korean Foreign Policy," accompanies this article. "Use of military power" to halt North Korea's nuclear weapons program, such as "a U.S. preemptive strike, ... will certainly not serve the interest of South Korea" Ambassador Kim warned, and would "create a serious impingement upon the sovereignty of the nation." Instead of war, South Korea needs "reinforced emphasis on regional cooperation in East Asia," led by the New Silk Road. "[T]he future of East Asia belongs together.... The ongoing construction of the Trans-Korean Railways and their connection to the Trans-Siberian Railways will hopefully have a trigger-effect for further connections to the Chinese mainland and Trans-Asian Railways encompassing ASEAN countries."

Utopian Interference

The Korean Presidential election was close, because the South Korean population is deeply split. Voters over 50, who remember the Korean War and are grateful to the United States, are frightened by media hype about the war threat. Younger voters, who are more ignorant of this history, disbelieve the threat and want to get on to building a united Korea. South Korea fundamentally is a very pro-American place for good reasons, as the two countries share mutual respect for the absolute sovereignty of a republic under natural law.

The increasingly heavy-handed interference into the election, however, became too much for Koreans to take. First, there was the U.S. declaration of an oil embargo against the North on Nov. 14; then the seizure of a North Korean merchant ship on Dec. 11. These provoked North Korea to announce on Dec. 14 plans to reopen its plutonium reactor, just as President Kim had warned on Nov. 18 (see EIR, Nov. 29, International Intelligence section).

"Nobody wants the United States to intervene in our politics," one Seoul professor told the Korea Times. "Since the United States intercepted a North Korean cargo ship carrying Scud missiles, many politicians and local media suspect that the incident is part of an American maneuver to influence the Presidential poll."

There were even last-minute stunts on Election Day. Roh's key campaign partner Chung Mong-joon, popular head of the soccer association and heir to the Hyundai Group, suddenly pulled out of Roh's campaign and denounced him, seven hours before polls opened. Chung claimed that Roh had told a rally, that he would support Pyongyang in a conflict with the United States. As Election Day began, opposition spokesmen announced: "Now, we will win the election!" The Washington Post forecast that the Chung split would hand Lee Hoi-chang a victory. Yet Roh, who was "baffled" by Chung's move, had merely said: "South Korea should be able to mediate a possible quarrel between North Korea and the United States" if it got out of hand, the transcript shows. Chung locked himself in his home and refused to see Roh, leading to speculation that Chung may have been coerced into the whole provocation by a third party.

Richard Perle himself gave an incendiary interview, which appeared in the morning of Dec. 19 in the hard-line Chosun Ilbo, saying that "the option of using military tactics should not be ruled out" with North Korea. Perle said, that those who thought "resolution through diplomatic means" meant something other than 100% resolution were wrong, and that "the danger to be brought upon us by North Korea's nuclear development is so great that it will result in a quarantine of unprecedented comprehensiveness." He specified that South Korea needs to adopt certain "counter-battery artillery techniques," as war could be imminent, and threatened that more North Korean ships may soon be stopped at sea. But the voters weren't buying.

New IMF Economic Threat

The new government faces the need to demand sovereignty for Korea's economy, too. On top of the nuclear crisis, President-elect Roh now faces a blow-up of the economy. Just as Wall Street is touting the International Monetary Fund "economic miracle" in Korea, it is falling apart. The IMF's "success" was based on the inflow of hot foreign money, which has tripled the value of the Korean stock market since 1998. But now, the hot money is leaving just as quickly, exposing the miracle as consumer fraud.

Roh, a labor lawyer, is said to have a leftist leaning for further IMF "reforms." President Kim's weak point has been his ideological bias against the chaebol industrial combines; he allowed the IMF to shut down whole chunks of South Korea's industrial base. In November, the government sold the advanced $5 billion Hanbo Steel complex for scrap, at a dime on the dollar. Roh is said to share that bias. If so, this is the time to get rid of it. As Ambassador Kim Sang-woo points out, you can't eat cyber-space or fiber optic cable. Asia, and both Koreas in particular, require a "full-set" heavy industrial infrastructure and a full range of industrial output to grow and develop.

The LG Economic Research Institute said Dec. 19 that South Korea's economy will face a crisis in the second quarter of 2003, as exports to the collapsing U.S. economy dry up. They forecast "the aggravation of insolvent household economies, due to an increase in the burden to repay interest and loans." Based on the hot-money stock bubble, the Korean government and banks issued a large consumer debt. On advice from the IMF, Korean banks and companies began handing out credit cards almost on every corner, even house to house. Total household debt has been rising at a 34% annual rate, to almost $400 billion. As stocks drop, the consumer bubble is popping. The Bank of Korea (central bank) issued a report Oct. 8, entitled "Household Debt Feared to Spur Mass Bankruptcies," which states: "Households are increasingly exposed to credit risks by taking out more loans from financial institutions, causing worries over a possible massive number of household bankruptcies."