capitalist versus socialist progress

[Louis Proyect <lnp3@xxxxxxxxx>]

Brad:
>Nah. Not consistent with the post-WWII relative growth of Germany and
>the USSR, or West and East Germany, or Japan and the USSR. Can't call
>the USSR's post-WWII recovery "fast" by comparison with the recovery
>of the defeated axis powers...

Martin Hart-Landsberg, "Korea: Divison, Unification and US Foreign Policy,"
Monthly Review Press, 1998:

During the first two decades after division, many Koreans, perhaps even a
significant majority, viewed North Korea more favorably than South Korea.
Reflecting this sense of superiority, it was the North, not the South, that
made repeated offers for greater North-South communication and exchange.
The South Korean government not only rejected these offers, it refused to
make any counterproposals. Perhaps even more revealing of Korean
impressions of the two Koreas is the fact that in 1960, some 450,000
Koreans living in Japan officially selected North Korea as their "mother
country" as compared with 165,000 that selected the South. This difference
is even more impressive because the great majority of Koreans living in
Japan were originally from southern Korea. Between 1959 and 1962,
approximately 75,000 Koreans left Japan to permanently settle in the DPRK.

One reason that North Korea was able to confidently approach the South and
attract tens of thousands of Koreans from Japan was its economic
superiority. While South Korea struggled with recession and high rates of
unemployment during the 1950s, the North Korean economy generated full
employment and rapid growth. And even though new state-dominated relations
of production enabled the South Korean economy to grow rapidly over the
following decade, the North Korean economy continued to outperform it in
terms of employment, income distribution, and growth.

North Korea?s strong economic performance was the result of a thorough
state-directed transformation of Northern economic and social relations.
Although Japan did "industrialize" Korea, it did so in an uneven way. In
1940, approximately 85 percent of Korea?s heavy industry was in the north
while 75 percent of the country?s light manufacturing and almost all its
agricultural production was in the south. The division of the country left
each side with half an economy. The North Korean leadership responded to
this historical legacy by implementing a number of sweeping reforms which
radically changed workplace, gender, and ownership relations. It also
launched a series of economic plans?one-year plans in 1947 and 1948, and a
two-year plan covering 1949 to 1950?that were designed to create a more
balanced and self-sufficient economy. These initiatives were both popular
and effective.

North Korea?s economic progress was temporarily interrupted by the Korean
War. At the end of the war, power production was only 26 percent of what it
had been in 1949, fuel 11 percent, chemicals 22 percent, and metallurgy 10
percent. Agriculture was also in chaos (primarily because of the massive
U.S. bombing of the country?s dikes and dams).

Almost immediately after the armistice, the North began an impressive
rebuilding program, pursuing what Stewart Lone and Gavan McCormack call
"possibly the most centralized and planned economic development strategy of
any country in the world." A three-year plan was produced for 1954 to 1956
that gave priority to the development of heavy industry. The plan?s targets
were actually met some six months ahead of schedule. A five-year plan was
then drawn up covering 1957-1961, and its targets were also met ahead of
schedule. According to the DPRK, its completion meant that the country had
successfully built "a base for the development of an independent national
economy." A new seven-year plan was launched in 1961, with the aim of
modernizing the country?s newly created industrial base, as well as
establishing more technologically advanced industries.

In the postwar period, the state also completed the task of eliminating
private ownership of productive assets. Agriculture went through a process
of collectivization which proceeded in stages between 1953 to 1958, a
process largely driven by the destruction left by the Korean War, which
made the pooling of limited resources and labor necessary for survival.
Lone and McCormack describe the collectivization experience as follows:

"Despite the urgency of the task of capital accumulation for
industrialization, the regime seems not to have squeezed the farmers too
hard, allowing them to experience gradually rising living standards and
reduced taxation levels, until the tax on the agricultural yield was
eliminated entirely in 1966. Irrigation, terracing of hillsides,
mechanization (large scale production and allocation of tractors) and
chemicalization (use of fertilizers) were promoted on a large scale."

Urban handicraft as well as small-scale, privately owned enterprises
involved in commerce and industry also went through a similar process of
collectivization. By August 1958, the North Korean leadership, basing its
assessment on the extent of state ownership, announced that the country had
achieved "the socialist transformation of the relations of production, in
both the rural and the urban communities."

North Korea?s economic achievements were truly remarkable. Agricultural
output grew by an average of 10 percent a year during the 1950s and 6.3
percent during the 1960s. By the end of the 1960s, the government was able
to declare that the country had achieved food self-sufficiency. Industrial
growth rates were even more noteworthy. Gross Industrial Product in 1956
was almost three times what it had been in 1953; in 1960 it was almost 3.5
times what it had been in 1956. As a result, industry?s share of national
income rose from 16.8 percent in 1946 to 64.2 percent in 1965." And by
1960, machine-building had become the country?s largest industrial sector.
These achievements were so remarkable that even Western economists began to
speak of the "North Korean Miracle." In fact, according to the economist
Joan Robinson, writing in 1965, "All economic miracles of the postwar world
are put in the shade by these achievements."


Louis Proyect
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