[House Hearing, 106 Congress]
[From the U.S. Government Publishing Office]
U.S. POLICY TOWARD NORTH KOREA II: MISUSE OF U.S. AID TO NORTH KOREA
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HEARING
BEFORE THE
COMMITTEE ON
INTERNATIONAL RELATIONS
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTH CONGRESS
FIRST SESSION
__________
October 27, 1999
__________
Serial No. 106-81
__________
Printed for the use of the Committee on International Relations
Available via the World Wide Web: http://www.house.gov/international
relations
______
U.S. GOVERNMENT PRINTING OFFICE
63-194 CC WASHINGTON : 2000
COMMITTEE ON INTERNATIONAL RELATIONS
BENJAMIN A. GILMAN, New York, Chairman
WILLIAM F. GOODLING, Pennsylvania SAM GEJDENSON, Connecticut
JAMES A. LEACH, Iowa TOM LANTOS, California
HENRY J. HYDE, Illinois HOWARD L. BERMAN, California
DOUG BEREUTER, Nebraska GARY L. ACKERMAN, New York
CHRISTOPHER H. SMITH, New Jersey ENI F.H. FALEOMAVAEGA, American
DAN BURTON, Indiana Samoa
ELTON GALLEGLY, California MATTHEW G. MARTINEZ, California
ILEANA ROS-LEHTINEN, Florida DONALD M. PAYNE, New Jersey
CASS BALLENGER, North Carolina ROBERT MENENDEZ, New Jersey
DANA ROHRABACHER, California SHERROD BROWN, Ohio
DONALD A. MANZULLO, Illinois CYNTHIA A. McKINNEY, Georgia
EDWARD R. ROYCE, California ALCEE L. HASTINGS, Florida
PETER T. KING, New York PAT DANNER, Missouri
STEVE CHABOT, Ohio EARL F. HILLIARD, Alabama
MARSHALL ``MARK'' SANFORD, South BRAD SHERMAN, California
Carolina ROBERT WEXLER, Florida
MATT SALMON, Arizona STEVEN R. ROTHMAN, New Jersey
AMO HOUGHTON, New York JIM DAVIS, Florida
TOM CAMPBELL, California EARL POMEROY, North Dakota
JOHN M. McHUGH, New York WILLIAM D. DELAHUNT, Massachusetts
KEVIN BRADY, Texas GREGORY W. MEEKS, New York
RICHARD BURR, North Carolina BARBARA LEE, California
PAUL E. GILLMOR, Ohio JOSEPH CROWLEY, New York
GEORGE RADANOVICH, California JOSEPH M. HOEFFEL, Pennsylvania
JOHN COOKSEY, Louisiana
THOMAS G. TANCREDO, Colorado
Richard J. Garon, Chief of Staff
Kathleen Bertelsen Moazed, Democratic Chief of Staff
Mark Kirk, Counsel
Peter T. Brookes, Professional Staff Member
Joan I. O'Donnell, Staff Associate
C O N T E N T S
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WITNESSES
Page
The Honorable Tony P. Hall, a Representative in Congress from
Ohio........................................................... 4
Mr. Benjamin Nelson, Director, International Relations and Trade,
National Security and International Affairs Division, General
Accounting Office.............................................. 21
Ms. Gary L. Jones, Associate Director for Energy, Resources and
Science, Community and Economic Development Division, General
Accounting Office.............................................. 23
Dr. Nicholas Eberstadt, Visiting Scholar, American Enterprise
Institute...................................................... 41
Mr. Joseph S. Bermudez, Jr., Senior Analyst, Jane's Intelligence
Review......................................................... 43
Ms. Nancy Lindborg, Executive Vice President, Mercy Corps
International.................................................. 45
APPENDIX
Prepared statements:
The Honorable Benjamin A. Gilman, a Representative in
Congress from New York and Chairman, House Committee on
International Realations................................... 54
Rep. Tony P. Hall............................................ 56
Mr. Benjamin F. Nelson....................................... 63
Ms. Gary L. Jones............................................ 74
Mr. Joseph S. Bermudez, Jr................................... 86
Ms. Nancy Lindborg........................................... 95
Additional material:
``Light Water Reactors and Nuclear Weapons in North Korea:
Let's Be Fair With Our Comparisons submitted by Rep. Tony
P. Hall.................................................... 99
U.S. POLICY TOWARD NORTH KOREA II: MISUSE OF U.S. AID TO NORTH KOREA
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Wednesday, October 27, 1999
House of Representatives,
Committee on International Relations,
Washington, D.C.
The Committee met, pursuant to notice, at 10:05 a.m. in
room 2172, Rayburn House Office Building, Hon. Benjamin A.
Gilman (Chairman of the Committee) Presiding.
Chairman Gilman. The Committee will come to order.
Today, the Committee will hold the second in a series of
hearings this month on our Nation's policy toward North Korea.
Today's hearing will focus on U.S. aid to the DPRK, the missile
threat and North Korea's future. We are pleased to have
gathered a distinguished group of witnesses to discuss these
matters.
Five years ago, our Nation embarked on a massive assistance
program for North Korea. Today, the DPRK stands as the No. 1
recipient of our Nation's assistance to East Asia. Total aid,
including food assistance, is valued at over $645 million since
1995. That figure is expected to exceed $1 billion next year.
The American people may not be fully aware of the true
scale of this massive aid program. Today, our Nation and our
partners in the Korean Peninsula Energy Development
Organization, known as KEDO, provide at least 45 percent of
North Korea's heavy fuel oil needs. Our Nation also provides
over 80 percent of the internationally donated food aid to
North Korea. In sum, we feed one out of every three North
Koreans.
There is a growing concern in the Congress about our policy
toward North Korea. As U.S. assistance is growing, so is the
range of their missiles. It is now believed that two types of
North Korean intercontinental ballistic missiles can strike the
continental United States with weapons of mass destruction. For
the first time in our history, we are within missile range of
an arguably irrational rogue regime. Regrettably, we cannot
defend against that threat.
We are also concerned about the use of our aid. According
to the nonpartisan General Accounting Office, the GAO, at least
$11 million of fuel aid has been diverted by the North Korean
government. Fuel monitoring is dependent upon the North Korean
power system, which is often out of service.
We have also learned that, despite assurances from the
Administration that U.S. aid will not go where food cannot be
monitored, at least 14,000 tons of food aid, valued at $5
million, was diverted to military counties where monitors are
denied access.
One question looms large in any discussion of aid for North
Korea. We know that the government of North Korea is primarily
responsible for its economic collapse and food shortage due to
its misguided policies. If this were any other country, they
would be moving ahead on agricultural and economic reforms that
would lead North Korea back to food security.
For instance, Ethiopia went from famine to grain exporter
in just 5 years. No such reforms are presently under way in
North Korea. North Korea continues to hold out one hand for
aid, while in the other hand it holds a gun. This has resulted
in a very successful cycle of political blackmail and extortion
within the international community.
Finally, we are concerned about the human rights situation
in the DPRK. This pressing issue receives far too little
attention. North Korea classifies its people into 51 groups,
with over 7 million people regarded as members of the hostile
class, and I put that in quotes.
These people are starving, and our aid is stolen from their
mouths. North Korea has hit a new low in human rights, founding
``9.27 prisons'' where hungry children are incarcerated. To my
knowledge, the Administration has yet to ask North Koreans for
international access to these 9.27 prisons, even though they
were identified over a year ago by a Committee staff delegation
which went to visit North Korea.
We are calling upon the Administration to request that the
International Red Cross be granted access to these prisons in
order to monitor the health of the hundreds of thousands of
children who are trapped inside.
I think we have assembled the right people here today to
address these issues. We look forward to their testimony, and I
want to thank all of our witnesses for coming.
I now turn to Mr. Gejdenson, our Ranking Minority Member,
for any opening statement he may wish to make.
Mr. Gejdenson. Thank you, Mr. Chairman; and let me say that
I think every Member on this panel feels for the men and women
and the children in North Korea. The North Korean government is
a threat, but it is the greatest threat to its own people. The
tragedy that they have visited upon the children and the men
and women in North Korea is something that, I think, the entire
world is shaken by, and it obviously leads us all to great
concern dealing with that government.
I am particularly happy that we have our colleague Mr. Hall
with us today. I think he has been in North Korea five times
and is someone who is familiar with dealing with these kinds of
relief efforts, hardly ever occurring in open, democratic
societies. In very many of these instances they are either war-
torn or they are totalitarian and authoritarian regimes, and
again, most often, their own people suffer the most.
I believe Dr. Perry has developed a program for the United
States that meets our National interest and has ceased their
building of a nuclear capability and has gotten their
assurances to end missile tests. Clearly, we have to watch, and
I commend, frankly, all of those in Congress who continue to
press for more openness, more access and more information, but
I do believe we have to keep in focus how important it is to
try to end this rogue regime's assault on its own citizens in
its attempt to develop missile technology and weapons of mass
destruction.
Thank you.
Chairman Gilman. Thank you, Mr. Gejdenson.
Mr. Pomeroy.
Mr. Pomeroy. Thank you, Mr. Chairman.
I think this is a very, very important hearing. The issue
before us involves our ability to track the food aid we have
provided to North Korea. At all times, as we consider the
question this morning, I think we have to have at the forefront
of our thoughts the dimension of the crisis itself. The
estimates of lost lives in North Korea due to starvation ranges
from 1 to 2 million people--1 to 2 million dead from starvation
in North Korea.
One hears reports about literally an entire generation of
stunted children, stunted by virtue of malnutrition, never able
to obtain full physical size, but what we also know in terms of
its debilitating impacts on mental development, never able to
fully realize their intellectual capabilities as well due to
the absence of adequate food.
So even as we consider our ability to monitor food aid, let
us never forget for a second that people are starving today in
North Korea, joining the 1 to 2 million others.
This hearing also occurs, Mr. Chairman, in the context
where several different groups are taking a look at this
question. One group that we have discussed already in this
committee is the Republican Conference Task Force on North
Korea. It is very unusual, of course, to take a major foreign
policy question, take it outside of the Committee of
jurisdiction, and then within the majority party only
constitute a body looking at that very important issue. That is
what has occurred here, and I think it is very unfortunate.
The action of this task force has produced a report. That
report has been released to the National Journal. Upon its
release of the draft report, members of the Minority said, now
that you have made this public, can we at least take a look at
what you have done? We have been refused even today to have
copies of this report given to us. You can give it to the
press, give it to the world, but, for God's sake, keep the
Minority out of participating in discussions on North Korea in
the context of this special Speaker's Task Force on North
Korea.
This is much too important an issue for partisan politics.
One of the things I hope we will be able to do in this open
hearing, this open bipartisan hearing this morning, is look at
one of the allegations contained in that task force report as
it relates to food aid, according to the National Journal--we
rely on the National Journal because you haven't given it to us
yet to read ourselves. Apparently, you don't want us to pick it
apart or at least do some fact-checking for you.
The report alleges, ``significant diversions of food and
fuel aid,'' and so I hope in the course of the meeting this
morning we will be able to look at whether or not there is
substantiation for this ``significant diversion''.
Congressman Hall, one of the leading experts in the country
on North Korea and the dissemination of humanitarian aid, has
been there five times and will tell us momentarily there is no
evidence of significant diversion. All of the world food
programs that are participating will tell you there is no
evidence of significant diversion. The GAO will tell you there
are problems in auditing food aid, but they will not tell you
they have evidence of significant diversion, and so one wonders
where in the world this so-called Majority task force is coming
up with stuff.
Saying something doesn't make it so. You have got to have
the underlying facts, and so it concerns me greatly that
unsubstantiated allegations of this type are thrown out in the
context of Congress considering cutting-off all food aid, which
would accelerate the rate of starvation and malnutrition in
North Korea.
Let us with an open mind this morning explore whether or
not there is substantiation of this allegation of significant
diversion, even as we look at and acknowledge problems in
auditing the food aid there.
Thank you, Mr. Chairman.
Chairman Gilman. Thank you, Mr. Pomeroy. I just might add
that no one has called for cutting-off food aid in Congress at
this point.
Any other Members seeking recognition?
If not, if no other Member is seeking recognition, I would
like to welcome our first panelist, Congressman Tony Hall of
Ohio, former Chairman of our Select Committee on Hunger, and I
was pleased to serve with Mr. Hall on that distinguished panel.
It is a pleasure to welcome you to our Committee.
He is one of Congress' leading activists on food aid around
the world and particularly North Korea, and we want to thank
you for your past concerns about North Korea. We are pleased
that you are able to join us today.
If you wish to put a full statement in the record, we will
do it without objection. Please proceed.
STATEMENT OF THE HON. TONY P. HALL, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF OHIO
Mr. Hall. I want to thank you, Mr. Chairman, for the chance
to come before your Committee.
We seem to be testing the theory today that honorable men
and women can disagree quite often lately, and I want to thank
you for letting me have the time to disagree with you in
person. I know your views about North Korea--and some of the
Members of the Committee--and I know that they are sincerely
held. I appreciate your hearing my testimony this morning. I
want you to know that mine are sincerely held as well.
As you know, and as you have stated, I have been to North
Korea in the past 3 years 5 times. I spend as little time as
possible in the Capital so I can focus on the people in remote
areas whose condition is far worse and whose suffering is
oftentimes hidden from outsiders.
I don't make these trips out of any particular interest in
North Korea. In fact, my first experience with that regime was
when President Reagan asked me to go to the memorial service
for the South Korean cabinet ministers killed by North Korean
agents in Burma in the 1980's. I could not understand what
North Korea was doing in those days, and I still can't figure
out why they do some of things that they do today.
The reason I go to North Korea is the same reason I went to
Sudan last year, and the year before that to Rwanda, Sierra
Leone, Angola and Somalia--because of the humanitarian crisis
its people are facing. Most experts I talk to believe two
million or more Koreans have died in this crisis. Some people
who have been on the China border say that 3.5 million have
died. I think that is probably a little bit high. I am not
sure. But we do know that it is twice the number of Ethiopia's
famine, which was supposedly the worst famine of the past 50
years. This is the worst famine in the world today. That is the
reason I go, and that is the reason why I am here today.
I have three problems with the GAO's report on food aid to
North Korea. My first is that it is a negative bias that does
not track with my own experience and that of many of the aid
workers who serve in North Korea. I have detailed some of the
most serious omissions in my written testimony on page 2, and I
hope you will take an opportunity to look at these.
Another significant flaw is the report twists spot checks
of 10 percent of the schools, hospitals and orphanages that the
World Food Programme supplies into a finding that 90 percent
have not been visited. This ignores the fact that that is twice
the usual number of spot checks the World Food Programme makes
in other countries.
The World Food Programme is not policing the delivery of
every grain of aid. It focuses on ensuring that delivery
systems in place are working.
Worst of all, the report suggests that you can't believe
your eyes--that until there is proof that food aid is not being
diverted, the improving conditions all recent visitors have
observed in North Korean children is irrelevant. Yet, this
report does not cite even a single instance where food aid has
been diverted from hungry people to the military or to the
governing elites. In fact, it notes that there is no evidence
of such diversions.
There is an old saying that fits the GAO work on this
report to a T, one Congressman Armey recently cited on the
Floor. It holds that an economist is someone who spends all his
time proving that something which works in real life could not
possibly work in theory. This is what the GAO has demonstrated
with this report, to the detriment of this Committee's
oversight work and to the GAO's shame.
My second complaint about the GAO report is that if we
accept the standard it lays out, we risk raising the bar so
high that we will never be able to help starving people again.
If conditions in North Korea or any desperate place were
perfect enough to get the GAO seal of approval, there would be
no famine there in the first place. It is never open and
transparent societies that are the ones in trouble. They can
always feed themselves. It is other places like Ethiopia,
Somalia, North Korea, and Sudan; the reason is the regimes
which don't respect human rights are regimes that don't respond
to the people's human needs either.
If we refuse to help people who live under brutal regimes,
even when we can hide behind the excuse that we can't
absolutely guarantee they are getting food, we are betraying
President Reagan's policy that a hungry child knows no
politics. Our country is better than that. We are clever enough
to find ways around the hurdles like the ones detailed in this
report.
The World Food Programme and the private charities working
in North Korea see the human cost of letting the perfect be the
enemy of the good, and we should support them in this
tremendous good that they are doing.
My third major quarrel is that the ultimate result of this
report is to effectively remove a tool that Congress uses to
meet its oversight responsibility, and that is the GAO
investigation. The publication of a report that selectively
excludes the context in which the WFP operates, and virtually
all evidence that contradicts investigators' preconceived
views, virtually guarantees that no GAO investigator ever will
be allowed into the Hermit Kingdom. That will insult Congress
and undermine our colleagues' support for humanitarian aid, and
that is why the GAO's decision to rush its work and publish
something so incomplete deserves criticism.
The historic turn of events last month made it even more
likely that a second visa request may have been granted. I was
disappointed to learn that instead of seizing that opportunity,
the GAO proceeded on its original timetable. The result is the
GAO investigated North Korea by going only to Rome. It opted
for a quickie investigation of one of the largest humanitarian
operations in the world, instead of a thorough one. It produced
a report that aid workers don't find credible, a report that
does nothing to help U.S. and U.N. Representatives press for
greater access. It also foreclosed the Congress from getting a
true picture of what is happening to the people inside North
Korea.
Mr. Chairman, there is no one who cares more about feeding
hungry people than me, and there is no one who would make a
bigger racket than I would if food donated to starving people
were diverted to anyone else. I do not spend time for the heck
of it going to hospitals and orphanages and visiting TB
patients and sick children, AIDS patients and other people to
help the leaders of the countries, especially ones who aren't
doing enough to ease the suffering of their people. I do it to
help people who know little about politics, people who want
simply to eat and want to survive.
Mr. Chairman, I want to inform the Committee that I met
with David Walker about these concerns. I understand his
colleague, Ben Nelson, will include some of the clarifications
in his testimony. I appreciate that. I want to thank both of
them for looking into the reports that a key member of the
investigative team may have brought a personal agenda to this
work. I was heartened by Mr. Walker's interest and by his
acknowledgment that the World Food Programme has taken more
precautions in North Korea than it does anywhere else.
In closing, I want to say a few things about the people
besides hungry North Koreans who benefit from the improving
U.S.-DPRK relationship.
First: America's service-men and -women, 37,000 of whom are
stationed in South Korea. I have heard time and time again from
our own military that they wholeheartedly support humanitarian
aid to the people of North Korea, not only because it is a
humane response to a real need, but because it is an easy
investment to make on peace on that dangerous border. I want to
reemphasize that every time I go to North Korea I always stop-
off in Japan and South Korea. I talk to our military, and to a
man, enlisted men and officers say this humanitarian aid is
making a difference, and it is helping with peace on the
peninsula.
Second: American farmers. We are blessed not only by a
prosperous and free democracy but also by the world's most
productive farmers. Without last year's surplus wheat, our
contributions to the World Food Programme work in North Korea
would probably be half of what they are. The grain our farmers
grow is transforming ordinary North Koreans' views about
America.
Third: American allies. President Kim Dae Jung, a hero to
democracy activists everywhere, has devoted considerable energy
to bringing peace to the Korean Peninsula through his policies
of constructive engagement. Japan also supports U.S. efforts to
improve relations with North Korea, and nothing is more central
to these efforts than our response to the North or to the
United Nations' appeal for food and medicines for desperate
North Koreans.
Finally, I want to share my experience of some of the
famines I have witnessed. After the crisis ends, but almost
never until then, some people overthrow their leaders. Some
don't. Whatever they do about their government, however, people
who survive it remember famine as the worst kind of hell. They
remember who helped them as those around them were dying, and
they never forget who found excuses to do too little to save
their family and friends.
This GAO report ought to renew our resolve to keep pressing
Pyongyang to give the World Food Programme and others fuller
access. It ought not be an excuse to tighten the rules on food
aid so much that we cannot help people in North Korea and in
other countries who are in dire need. I would submit that your
quarrel is not with the World Food Programme. It is not with
one of the most conscientious and aggressive executive
directors this organization has ever had--a leader who has
turned ships around and refused to play Pyongyang's game. It is
not with Mercy Corps or the other American charities working in
difficult conditions, but getting the job done.
Mr. Chairman, I appreciate your determination to ensure
that our food is getting to the people in North Korea who know
nothing about politics--people who only want to eat, who want
to survive. But as the Committee examines our policy toward
North Korea, I urge you to set aside the contempt--sometimes a
contempt that is earned and one that all Americans feel for
this totalitarian state--as you make your judgments. I urge you
to focus attention on the nuclear and missile issues that I
believe are your real concern, and to do all you can to support
the humanitarian aid that is saving hundreds of thousands of
innocent lives.
Thank you, Mr. Chairman.
[The prepared statement of Mr. Hall appears in the
appendix.]
Chairman Gilman. Thank you, Tony Hall, for being here
today.
As I mentioned before, Congressman Hall has been one of our
leading advocates of food aid for North Korea, and I want you
to know that there is no proposal, at least on this side of the
aisle, for any cut-off of food aid. However, we are concerned
about the responsibility for the food shortages I know you have
explored in the past. Is it the weather or the government that
is responsible for the food shortage?
Mr. Hall. It is many things, Mr. Chairman. It is, first,
this Hermit Kingdom relied so much on the former Soviet Union
to bail them out with food aid and medicines and those kinds of
things. As you know, when the former Soviet Union came apart,
they no longer really helped North Korea, so food aid and
medicines were not sent, and China doesn't help as much as they
used to.
Second, you have a country that is 80 percent mountainous,
so the growing regions are not sufficient to support the
country's needs. Their farming methods are the old collective
system, the old Communist system, and they don't work. They
have depleted their soil and destroyed much of their land.
I am not a farming expert. I have had farming experts--
agricultural experts travel with me to North Korea. There are
few trees; they have torn them down. They also have suffered
from drought. They have suffered from floods. Anything you can
imagine that would happen to a country has happened to them.
Plus, they have a very oppressive regime.
Chairman Gilman. Mr. Hall, have they made any effort to
reform their agricultural policy?
Mr. Hall. They are making some. They are inviting more and
more people into the country that are agricultural experts.
They are sending a few of their people outside, particularly to
Australia. There are farmers in our country asking some of
their farmers and agricultural experts to come over for a few
weeks. They are a long way from making reforms.
Chairman Gilman. With other recipients of food aid we have
insisted on radical reforms to their economy to ensure that
those societies can feed themselves in the future. Why can't we
be more insistent on reforms so that the North Koreans can
eventually feed themselves? Is there any objection to doing
that?
Mr. Hall. There is no objection from me. It is something I
press them on every time. Every time I press them on it, from
the standpoint of reforms of their agriculture policy, they
always say, we are a sovereign nation; this is the way we are
going to run our government. This is not an easy government,
Mr. Chairman.
Chairman Gilman. We recognize that.
Mr. Hall. If it was an easy government, we wouldn't be in
there. If it was an easy government, they would be taking care
of their people. This is not an easy government to get along
with, so every time you raise the issue of reform they get
stubborn, they get defensive. They will say, I am a sovereign
nation; you don't really have the right to ask. But I have
noticed lately, the past time I was there, that we have had
some very good talks. They are starting to make reforms, but
they are gradual. They are very slow.
Chairman Gilman. Congressman Hall, with regard to taking
care of their people, what about their resistance to monitors
to make certain the food assistance gets to the people?
Mr. Hall. As I said before and one of the things that I
have taken issue with in the GAO report is the World Food
Programme checks about 10 percent of the food going in and out.
Chairman Gilman. So 90 percent of the food is not
monitored?
Mr. Hall. Yes, and let me just stress that part. The GAO
used the figure of 90 percent, like, oh, wow, this is a big
figure, they are not monitoring 90 percent. We don't monitor 90
percent any place in the world.
Chairman Gilman. We monitor more than 10 percent, do we
not?
Mr. Hall. No. In most places we do not, especially in
Ethiopia in the 1980's. The World Food Programme will tell you
if they spot check 5 percent in other countries that is the
standard. They do 10 percent in North Korea. So it is twice the
average.
Chairman Gilman. Of course, in other countries there is no
prohibition for monitoring, and it is our capability of
monitoring. Here in North Korea we find an inability to monitor
if we wanted to undertake more monitoring.
Let me ask you a further question. Do you agree that our
State Department should insist on access to the 9.27 prisons
for the hungry children?
Mr. Hall. I think we should continue to press on that, no
question about it. Wherever hungry people are in the country
who we can find and get to, we should continue to press it,
absolutely.
Chairman Gilman. With regard to your criticism of the GAO
report and the integrity of the report, my staff had checked
with GAO and they stand by their report. I regret that some are
criticizing the integrity of the investigator.
I want to thank you, Mr. Hall, for being here, and I now
turn to Mr. Pomeroy.
Mr. Pomeroy. Thank you very much, Mr. Chairman.
I have great regard for the Chairman. He does have a bill,
however, that I believe would affect the continued provision of
food aid to North Korea, and, in fact, I believe it would cut
it off. I would like your opinion as an expert relative to this
matter. The legislation at issue, which has been introduced,
and in fact is H.R. 1835, would require the following
conditions to be certified before further food aid could be
provided, and I will just read them to you.
``The government of the Republic of Korea concurs in the
delivery and procedures for delivery of the United States food
assistance to North Korea.''
That one would be met. They strongly do concur that this
food aid should continue. Is that correct, Mr. Hall?
Mr. Hall. Absolutely.
Mr. Pomeroy. Second, ``previous United States food
assistance to North Korea has not been significantly diverted
to military use.''
Do you have thoughts in terms of whether or not we can
somehow come up with a certification as to all prior food aid
we have provided?
Mr. Hall. That is very, very difficult. It is a very hard
thing to prove.
From time to time I have had people come to me and say, did
you see that recent report where the North Korean submarine
infiltrated the waters of South Korea, and did you see the food
that they showed? They had canned food, and that shows that our
food is being diverted.
I say that is very interesting. We don't give canned goods
to North Korea. We give food to the World Food Programme, and
it is brought in by ships--it is brought in as grain in the big
holds, and then we bag it there.
So the food that comes into North Korea that might be
American food is probably bilateral assistance. I have said to
South Korea on a number of occasions, never send bilateral
assistance to a government like this because it will never be
monitored. You don't require it. I have said it also to the Red
Cross in South Korea, don't give bilateral aid. You can't check
it. But our aid that goes to the World Food Programme, they
check 10 percent of it, and that is twice above what they
normally check in other countries.
So these stories that we hear about American food showing
up in North Korean submarines, this is not U.S. food that we
have donated. It is probably coming from either China or South
Korea, and it is bilateral assistance. There are about four or
500,000 metric tons of this that is not monitored. This is not
U.S. food aid.
Mr. Pomeroy. A fundamental question seems to be, at a time
when we have yet, and I don't think we will hear from the GAO
this morning proof of significant diversion, to place the
burden on proving no significant diversion without proving the
diversion is a bit much. What are we going to do? Ask the
Hermit Kingdom, this bizarre, completely objectionable regime,
to provide us some kind of big-six Price Waterhouse audit
trail? I mean, how are you going to meet these conditions? I
agree that they have a very pernicious impact, even though they
may not on their face.
Let me just ask you whether the GAO looked at--beyond
monitoring--looked at basically the health status of the
population, from whatever source available, to determine
whether or not there appears to be some food aid that is doing
some good.
Mr. Hall. They never looked at that. There are enough
significant reports out to show that the food aid is absolutely
making a difference. I have seen the difference in the 5 times
I have been there. The last time I was there, in August, it was
clear that it has made a tremendous difference.
The biggest problem in North Korea right now is not that
our food aid is not making a difference; it is that they have a
tremendous health problem. They have a TB epidemic and all
kinds of waterborne diseases. They have no medicines in the
country. They are operating on people without pain medication.
I always visit hospitals and orphanages. They hold people down
when they operate on them because there is no pain medication.
They use the same cotton gauze after they get done
operating on people. They wash it and dry it on the windowsill,
and use it again for the next person.
There are no antibodies in the country. There is a severe
health crisis. So what's needed next we need--some more
medicines going into the country, and there are virtually none
in there.
Mr. Pomeroy. Secretary Perry has indicated that he has
observed improving nutrition by just general observation and
anecdotal report. That apparently comports with your own
evaluation, and the GAO certainly had some capacity to try to
gather some of that information as well in making a conclusion
on food assistance.
Mr. Hall. They did not gather it. They didn't go to North
Korea. They got turned down once, and they didn't reapply for
visas.
Oftentimes, I get turned down. I got turned down, one time,
five times. You have to continue to press them to get in. The
fact is, because of this report, I think GAO--which to me has
always been a tremendous agency that I have always respected--
to their discredit, they are finished. They are never going to
get into North Korea with this kind of report because it is not
accurate. I think they have hurt us; they have hurt the
Congress. We are not going to get a good report now on North
Korea from our own people. This is a group that is supposed to
be independent, and as a result of this report we are not going
to get true monitoring. We are going the have to depend on our
NGO's and the World Food Programme, which we always have. They
are adequate, but it is not the kind of report that we need.
Mr. Pomeroy. Thank you.
Chairman Gilman. The gentleman's time has expired. Thank
you, Mr. Pomeroy.
Mr. Houghton.
Mr. Houghton. Yes. Mr. Hall, in trying to wrap this
together, what does it all mean for us? I mean, the GAO is
persona non grata, and we shouldn't do bilateral aid and a
whole variety of things are out there. Do you see any position
for us over the next 2 or 3 years, other than through the World
Food Organization?
Mr. Hall. Mr. Houghton, the food aid is making a difference
in North Korea. It is making a difference in that more and more
of their children, their women, their handicapped and their
older people, are now living as a result of it.
Second, it is buying us time. If you were to talk to our
military and our military experts, the ones who are on the
scene in South Korea--we have 37,000 troops there--they will be
the first to tell you that this humanitarian aid is making a
difference.
I always take military people in with me. They have taken a
very good look at the situation. They believe that it is making
a difference. It is bringing peace to a very difficult
situation.
South Korea is with us. Japan is with us. We are speaking
with one voice.
Third, we never use food as a weapon. We go any place in
the world where people are starving. We have always done that.
If you want to take a regime that was very difficult, go
back to Ethiopia in the early 1980's. The way this government
came into power was by coming into the cabinet meeting of the
former cabinet of Haile Selassie, and the leader, Mengistu,
mowed down everybody with a machine gun. That is how he started
his government.
If there has ever been a hideous government, it is that
one, and we gave them a tremendous amount of food aid. You know
how we did it? We went around the government. We never gave
bilateral aid. We gave aid through our NGO's, through the World
Food Programme, through UNICEF. We trust these people. We have
worked with them year after year. We believe that they deliver
tremendous amount of goods with low overhead. We are doing the
same thing in North Korea. We are doing what we have always
done. We are not saying we love this government; we don't. We
are not saying that they are our best friends; they are not. We
are not saying that we respect them because we have major,
major difficulties with them.
What we are saying is, we are helping their people live. It
is paying tremendous benefits for all the people in the Korean
Peninsula and for the people who will live because they are
going to remember who helped them long after this.
Mr. Houghton. I applaud you and I applaud the efforts of
those people who have been involved in this.
I guess you can't really help an entire society by food aid
programs. You can help certain amounts of people, I don't know
what the percentage is, but if their trees are all down and the
farming land is not productive, where does it all go? Is this
just a Band-aid or is this really the beginning of a
resuscitation of that economy?
Mr. Hall. This is a beginning, and it is keeping some
people alive, probably hundreds of thousands of people alive.
The kind of reforms that you are talking about--reforestation,
medicines, hospitals, equipment, agriculture reforms--we can't
give that. We are prohibited by law from giving those kinds of
aid programs to North Korea. The only thing we can give is food
aid.
Mr. Houghton. Thank you very much.
Chairman Gilman. Thank you, Mr. Houghton.
Mr. Hastings.
Mr. Hastings. Thank you very much, Mr. Chairman, for having
this hearing; and, Representative Hall, thank you so much for
your testimony. Let me see if I can go in yet another direction
to draw on the benefits of the enormous experience that you
have, Tony, in this arena.
If you were to analyze just briefly any other report that
you know of that the GAO may have done regarding food
distribution in the world and compared this one, how do you
rate it? I have heard your criticism, but is this standard? For
example, I'm sure that GAO must have done reports on other food
distribution programs. Do you follow where I am coming from?
Mr. Hall. I have followed GAO reports on a number of
matters, not only food aid but many things that we in Congress
have asked them to do. I have always been very, very supportive
and very pleased over their neutrality and how they have looked
at an issue. I was very surprised at this report when I read
it. Actually, I didn't believe it. I thought, how did they get
this report? I have been there 5 times, and they did not ask to
come see me until their report was finished. My staff asked
them to come see me. They just came to see me last week. That
is first.
Second, they made this report by gleaning what other people
said, and they kind of twisted it, in my opinion, and took it
out of context. So instead of saying the World Food Programme
checked 10 percent, which is 100 percent above what they
normally do, of food supplies, they missed out on 90 percent.
That is a kind of twisting of words. I am surprised that they
did those kinds of things.
Third, they went to Rome to investigate North Korea. Now,
how do you investigate North Korea by only going to Rome?
Fourth, they have raised the standard on what it is going
to take to help these very difficult governments, whether they
are Communist governments or whether they are dictatorial
governments. The standard is now so high that, if we were to
follow what they have said in this report, we won't be able to
go anyplace. The places that we could go under this logistic
are ones that are already helping their people.
I don't understand GAO. I really don't. It is a very, very
good agency, but, on this one, there is a lot of criticism
deserved.
Mr. Hastings. I guess they would come back and argue that
the office of the World Food Programme in Rome had some
accountability issues in dealing with their paperwork, but I
agree with you. I think it ignores what you know so well and I,
in a limited way.
A report like this for example, can discourage the World
Food Programme where there is no opportunity. It does appear to
offer a serious rebuttal at this point, and I am assuming at
some point we will do that. But you and I know for a fact--I
have been in the southern Sudan when shooting was going on, as
you have, and the World Food Programme is delivering food
through Christian factions and the Muslim factions fighting
each other and fighting against governments at the very same
time. So they do an enormous job, and it is not certain in any
instance when you are dealing with a regime like North Korea
that every ounce of wheat or food that is being distributed is
going to arrive at its destination.
I would urge that if we wanted to do one that is serious,
Russia is going to have serious problems real soon. I stood on
the streets in St. Petersburg outside a port and laughed
because I am street smart at how much food, which wasn't coming
from the United States but was coming from another source,
wasn't going to the trucks like it looked like it was intended
to go.
So you can always find those kinds of things. You can go to
the ports of New York and find some of it didn't get there in
the first place. No reflection on New York--this is also true
in the Miami area. But my point is that somewhere along the
line, we need to be very, very careful with these kinds of
reports, because the people that have the responsibility of
conducting the actual distribution are deserving of more than
just criticism from afar.
That is all I have, Mr. Chairman.
Mr. Hall. If I thought, as I said in my testimony, that any
of this food was being diverted in any way, I would be the
first one to say, if it is going to the government and to the
military, then don't send it to this country.
Second, every time that I have been in the country, I have
always met with all the NGO's, including the World Food
Programme. There are always about 25 or 30 there representing
the different groups that are working there--European groups,
et cetera. Every time, I ask them, can you cite for me any
diversion of food, can you give me anything on that? They have
always said, we cannot cite one example. Does it happen? I am
sure it does. But if it was happening in any major way we would
hear about it. I'm sure we would hear about it.
Mr. Hastings. Thank you, Representative Hall.
Thank you, Mr. Chairman.
Chairman Gilman. Thank you, Judge Hastings.
Mr. Sanford.
Mr. Sanford. I thank the gentleman for his great testimony.
I guess I come from a different school of thought on this
thing in that, to me, Tony, this is a question about markets. I
have got a number of young sons, one of whom I am in the
process of trying to teach to ride a bike. It seems to me that
if I never, ever let my hands off the back of that bike he
would, at best, slowly learn how to ride the bike--or more
likely, never learn how to ride the bike.
You think about governments--I mean, right now you have got
Russia target bombing different parts of Chechnya, and yet on
the other hand, we are indirectly providing aid. It seems that
a lot of governments can do a lot of things if they are not
held accountable by the markets. To me, the oil we send in, the
food that we send in, helps to perpetuate a regime that is, by
all standards, very, very repressive.
so, first, I am struggling with the market impact of what
is going on and how this may, in fact, as the gentleman from
New York had suggested earlier, be a Band-aid for what is going
on there. It may, in fact, slow reforms. It may slow change in
the government. I would ask your thoughts on the element of
Band-aid.
The second thing that I would bring up would be what you
just last said, and that was, if it was, in fact, the case that
food was being diverted, you yourself would say we shouldn't be
sending the food. That to me brings this straight back to this
GAO report. I mean, we talk about GAO like it is something
abstract, and yet, if I am not mistaken, these are NGO
investigators back, over your right shoulder, and they are not
obstructions. If you were to point to one of them and say, yes,
either one of them is incompetent or one of them has a strong
bias--I don't think you would say it is that one versus that
one, or would you? GAO is right there, and they seem like
professionals, they look like professionals. Every other GAO
report that I have gotten--most people in government seem to
think a lot of those reports.
So I don't understand the idea of relying on GAO reports on
a consistent basis for other areas of government, but then when
it comes back to being conflicting saying, well, it doesn't
make any sense here. Because, again, the people who produced
it, or at least components in the production of it, are
standing there over your right shoulder.
Mr. Hall. That is a good question. I have come here to talk
about the GAO report because I was very worried about the
Chairman and the Members, about the kind of bill that they may
have introduced in the past couple of months. If we had to
follow it, you would have to cut-off aid to North Korea because
there is no way we can fulfill those conditions.
When I heard the GAO was going to do a report, I said to
myself, good, great, let us take a neutral look at this. I have
been there 5 times. You know what? I still don't understand
this place. It is difficult. They hide so much.
Yet I have eyes. I know what I am looking at, and I know
what I am seeing when I go into hospitals and orphanages and
schools. When I go up-country and I stay up-country, I can just
walk around and see it. But they had a chance, too, to go there
if they had pressed it. They asked once, and they got turned
down. Everybody gets turned down. The Chairman's gotten turned
down, but he has also had some of his people go into the
country.
GAO didn't talk to me. They don't have to talk to me, but
they could have talked to some other people that have been in
there. They could have pressed their point. They could have
cited reports that would show that the food aid and the
programs there are working.
What I am concerned about is that report was written in
such a way that, if I was reading it and never had visited
North Korea, I would say, well, maybe we shouldn't give them
food aid because it is probably being diverted.
Mr. Sanford. So you are saying one of those folks right
back there has a bias against North Korea?
Mr. Hall. I can't point my finger at anybody, and I
wouldn't do that. What I am saying is their report is biased,
and it is not accurate.
Mr. Sanford. That would be your opinion.
Mr. Hall. That is about as clear as I can get it. That is
my opinion.
The other thing, what you said in your first part, North
Korea can take care of themselves. These people are very
difficult people, but they are hardy, they are hard workers.
There is no heat in the country. There is no power in the
country. All the factories are closed down. The people are all
stunted, the children, I mean. There are so many orphans in the
country it is unbelievable. There are hardly any senior
citizens left. You don't see them anymore. A lot of them died.
The situation is so bad that if you were there and you came
with me to see this, you would say to yourself--our policy in
this country has never been to use food as a weapon. We have
said we would always help a hungry person, and we have always
done that. We have never held back.
If you want to hold back on nuclear programs, you want to
hold back on development assistance, you want to not lift
sanctions, those kinds of things because of their policy on
missiles, that is one thing. But never hold back food and
medicines, and we never have. I guarantee if you saw these
people die, you would say these people don't know anything
about this government. They want to live, they just want to
make it. You would say, those are my children. Those are human
beings, and we should help them, period. That is all I am
saying here.
If this GAO report was used in conjunction with this bill,
all aid to North Korea would be cut-off, I guarantee you. We
are the biggest supplier of food to North Korea, and so that is
why I have come here in such a very strong way against this
report. I am surprised at GAO because I know that they are much
better than this.
Chairman Gilman. Thank you, Mr. Sanford.
Mr. Ackerman.
Mr. Ackerman. Thank you, Mr. Chairman.
If I can take the liberty of disagreeing with my colleague,
you are a big deal. I have served in this body for over 17
years, and I have carefully followed your work over that time.
You have so successfully filled the shoes of the legendary
Mickey Leland, and in a way that is so quiet and without
calling any attention to yourself in a selfless fashion,
traveling to so many places to care for those that need, that I
think that you are one of the true heros of this Congress.
Mr. Hall. Thank you.
Mr. Ackerman. There is nobody that I know of in this
Congress, either body, that has done the kind of work that you
have done on behalf of hungry and starving children all over
the world. You have the admiration not just of myself, but
anybody who has followed these issues, and your credentials are
absolutely impeccable.
That being said, North Korea is indeed a pretty sorry
place. There are children and people that are starving, without
question. There is food that is going there that is inadequate,
and we sit here and quibble about whether or not some of the
food is being diverted.
I have been to North Korea as well. I know that in that
nation of a little over 20 million people, which means about 10
million men, probably 7 million of which are of fighting age,
of which there is a million men standing army, North Korea has
one of the largest standing armies in the world. You add that
up, plus all of those in the reserves, and everybody in the
country anywhere near the capital, at least, is in uniform. In
addition to the standing army, there are millions and millions
who are also part of the army.
If you have a country where all of the people are in the
military, how many children--this is a rhetorical question--how
many children are not the children of soldiers? Innocent
children, most of them have fathers who wear uniforms and carry
guns. Do they not get fed?
That is not to say that the army is supposed to divert the
food. It is supposed to be distributed in an equitable way. But
is there any country to which aid is given, either from
external sources or from within--can we say that the food that
we have for people who are on welfare is distributed without
any diversion? Do we have waste and fraud and diversion within
our system? Do we not fight that in this Congress all the time?
Is it not those who disagree with providing aid to the poor
altogether who just narrow in on the aspect of let us not do
this because it is not distributed 100 percent efficiently?
We have fought those fights together, and I think we have
to be cognizant of those nonissues when we deal with North
Korea as well.
One of our colleagues before brought up the issue of market
impact in North Korea. Is there a market? You have been there
five times. Is there any market in North Korea?
Mr. Hall. There is no market there.
Mr. Ackerman. So there is no market impact on anything?
Mr. Hall. If there is a market, it is illegal.
Mr. Ackerman. Markets are illegal. So there is no market
impact on anything, it is a complete nonissue, and those who
are familiar at all with the area know and understand that.
You are zeroing in on the GAO report. The GAO is an office
that we have had tremendous confidence in over the years. I
think that it is regrettable that there has been so much doubt
cast upon this particular report, and I think that perhaps this
should not spill over on to the entire agency.
But a question was asked before that had me a little bit
confused. That was, did the author of the report have any bias
against North Korea? I would ask if the author of the report,
in your view, had any bias against the World Food Organization?
Mr. Hall. I don't know a lot about this. This continues to
come up frequently since this report came out. What I have
heard is that one of the investigators, one of the persons who
had something to do with this report, applied for a job with
the World Food Programme a few years ago. It was a very good
job, and he was turned down. Some people have felt that that
played a part in this report. I don't know.
My staff asked Mr. Nelson about this, and he assured us
that they would look into this potential problem.
Mr. Ackerman. Thank you. I think the next panel should
expect that we will ask that question.
One further comment, if I may, Mr. Chairman. One of our
colleagues brought up the analogy of teaching children to ride
a bicycle. Sometimes you have to let go of the bicycle,
otherwise they don't learn how to ride a bike. I taught my
children how to ride a bicycle, too, but in putting them on the
bicycle the first time, I wouldn't let go as they were going
down a 45 degree incline toward the river.
The other thing is, when we talk about maybe we should go
in and insist, as we do elsewhere, that people get their house
under control economically, that they put in certain reforms
before we help feed them. We don't do that. When children are
starving, we don't rush in to the family and say, well, let me
take a look at how you are keeping your checkbook or what you
are spending your money on. You feed the children first as you
work on the politics and the program in another forum. I don't
think that we should take out the politics. I would ask you to
comment on that--to take out the politics of a country that is
one of the most repressive regimes in the world on the poor,
innocent children that are going to have to grow up within that
regime.
Mr. Hall. First off, Mr. Ackerman, I appreciate your
statement. What you said about me was very kind. It is not
true, but it is very, very kind. I love hearing it, and I
wished I could make a statement after that as well as you could
the way you have articulated this whole situation.
This is a particularly difficult situation, the Korean
Peninsula, and not only because people are starving to death,
which we are trying to address. The fact is we have 37,000
American troops there, so the food shortage is very relevant to
us. It is also very relevant to the South Koreans, because they
are within a short missile range where a lot of damage could be
done very quickly. At any one time we have several hundred
thousand Americans in Seoul, which is very close to the DMZ.
There are so many things involved with this. First, it is
the right thing to do because we don't use food as a weapon, we
are helping people to live, and there has been a big change in
North Korea toward us as a result of that.
Second, and this is something I cannot overemphasize, our
military people in South Korea have said to me, time and time
again, can't you keep the rhetoric in Congress down on the
North Koreans? We believe this humanitarian aid, the trips that
I have taken, and the Perry trip have really helped. Can't you
keep the rhetoric down? It is very dangerous here, it is a very
stressful time, especially with the rhetoric coming out of
North Korea, the missile tests, et cetera, This food aid has
made a tremendous difference, and it is helping with the peace
process. The fact that the President lifted the sanctions
bought us a lot of time, a lot of time.
The bottom line in North Korea and other countries in
crisis, is government people and military people, they never
die. They always have food. They have their own reserves. They
grow their own food. They are probably getting a significant
amount of their own food for government and military people
from China as bilateral aid that is not monitored.
Our aid is monitored as best we can. We can do much better,
and we are always pushing. I remember when the World Food
Programme only had three people in the country. Now they have
100, and a good portion of them are monitors. We are not
monitoring as best we could, but we are making checks. I myself
have seen food being delivered to people in very small villages
to take home. That doesn't say that there isn't some kind of
diversion.
We are doing the right thing. It is a difficult political
climate, but I can't tell you how proud I am of this country,
of our staying in there in a most difficult situation and
helping people we don't know a whole lot about, people who have
been sheltered in this Hermit Kingdom for 50 years. If
everybody in this room here was sheltered for 50 years in this
room, without getting out, as soon as we got out the door we
would seem kind of strange to other people as well. That is
what has happened. They are changing gradually.
Chairman Gilman. Gentleman's time has expired.
We are pleased to be joined today by the gentlelady from
Florida, Mrs. Fowler, who is a Senior Member of the Armed
Services Committee and also a Member of the Speaker's Task
Force on North Korea. Mrs. Fowler.
Mrs. Fowler. Thank you, Mr. Chairman, and I want to thank
Congressman Hall for all that he does and continues to do for
needy people around the world.
I share the views of my colleague who spoke earlier,
because I know how much you do and how much you care in your
efforts. You have been to North Korea probably more than any
other Member of Congress, so you do have a great knowledge and
better understanding than many of us of what is going on there.
But I also share some of the concerns that have been expressed
by some of my colleagues. When you use a phrase like ``buying
time'' when we are giving this aid, my view is that it bought
them time to make more nuclear weapons.
This is a regime that, I think, we have to trust but
verify. We have to work with them and move forward together,
but we have to verify every step of the way, whether it is food
aid or fuel aid or whatever kind of aid we are giving. But, as
you have said, it is very difficult to understand how they
operate and what they do.
I would just like to ask a question that you alluded to
earlier on, and it has been of concern to me. In going back to
this reference of riding a bicycle and whether you do or not
depends on how you learn, one of the factors that hasn't
received much discussion in the GAO report is the environmental
policies in North Korea. Those directly relate to production of
food. You refer to the deforestation that you have seen
throughout the country. There are a lot of other unwise
environmental policies that the country has followed which have
contributed to a lot of the disasters that they have
chronically, and that have an impact on their food production.
So I just am interested, in light of this massive food aid
program that we have that is ongoing with them today, what if
anything our government is doing, or do you think we should be
doing in terms of insisting on some changes in their
detrimental environmental policies? Because, again, they will
never get to the point of being able to sustain themselves in
food production if we don't do some of that, too. We are ready
to force environmental policies. We want to on trade agreements
with other nations. What are we doing with this nation as far
as trying to get them to move forward in that area? Do you have
any information on that? I didn't know. . .
Mr. Hall. First off, we are not doing anything. We can't.
We are limited by law because we cannot be part of any
development assistance for this country. Until that law
changes, we cannot contribute or be part of any reforestation,
agriculture reforms, or other developments.
There are some reforms that North Korea has agreed to with
UNDP, a package of environmental and agriculture reforms.
Mrs. Fowler. That is what I meant as our insisting on some
of these types of reforms--conditioning our aid, our food aid,
our fuel aid, or any of these types of aid on that being part
of it--that we are not doing it for them, the reforms, but they
themselves in working with the appropriate groups.
Mr. Hall. I see nothing wrong with conditioning development
assistance on certain reforms. I don't see any problem with
that at all. I think we should. I have problems with putting
conditions on food assistance.
Mrs. Fowler. On fuel or things like that?
Mr. Hall. There should be no conditions, period. Give food,
keep people from dying. That is it, period. That should always
be our policy. That has always been the policy of our
government. We have always had that policy, even toward the
worst regimes of the world, and that should always be our
policy.
These other policies, agricultural aid, environmental aid--
the reason there are no trees in the country is because they
don't have any power. People are going up in the hills and
cutting all the trees down. If you stay up-country, out of
Pyongyang--a lot of people just go into Pyongyang, they see
people look a little bit better, they are dressed a little bit
better--but you get out of the capital, there are no plants
working. There is no heat in any hotels. There is no power in
the hospitals. People are walking everywhere. You can be on the
road and you will never see a car, or the only thing you will
see is maybe a military truck. That is it. They don't have
power. So what they are doing is they are going up into the
hills, and they are cutting the trees down.
Mrs. Fowler. As you know, part of our effort is to help
them with their power. I have deep concerns about what this
Administration is working out. We were in a briefing, the
Chairman and I, a couple of weeks ago when we received
information that is not classified--some of what we got is
classified--that the two light-water nuclear reactors that the
Administration is moving forward to allow the North Koreans to
have are such that they could produce several score of nuclear
weapons a year with the plutonium drawn-off of them versus the
one they had been using which could only produce a handful, and
that there are other forms of producing electricity. If this
was a country really interested in producing electricity for
their citizens and really interested in peace, there were other
manners in which this could have been done.
I do worry about the Administration sacrificing the short-
term together with the long-term national security of the
United States of America, and I think that is something we have
to continue to work on. That isn't a subject for which you are
here today, but those types of things color the way many
Members of Congress look at it.
Mr. Hall. I am not an expert, Mrs. Fowler, on the nuclear
reactors and the 1994 Agreed Framework in that program, but I
did read the various debates and excerpts from the last debate
you had on it. I think Mr. Cox referred to a capability to
produce several hundred nuclear missiles. That has been
refuted. That is not correct. As a matter of fact, I think
there is a report here today by scientists saying that there is
no way----
Mrs. Fowler. They are definitely going to throw-off several
hundred kilograms of plutonium per year, and the answer we get
is, well, it is not, ``weapons-grade plutonium''. It can be
used to make nuclear weapons. We have had scientific testimony
about that.
Mr. Hall. Here, again, I am not an expert. This report just
came out today to the Committee. So I think they don't feel
that what Mr. Cox said was accurate.
Mrs. Fowler. Mr. Cox was in the same briefing I was in, and
Dr. Graham, who provided us with that testimony, is pretty
knowledgeable in that area. We all want to help them with
providing electricity. As you say, part of the key is getting
heat, getting electricity, but we prefer to do it in manners in
which it would be used peaceably and not used against us, but
that is for another day.
Thank you very much for all that you do and continue to do
around the world. You really set a good example for everyone.
Mr. Hall. Thank you.
Chairman Gilman. Thank you, Mrs. Fowler.
What report were you referring to, Mr. Hall?
Mr. Hall. This is by the Institute for Science and
International Security. It is titled, ``Light Water Reactors
and Nuclear Weapons in North Korea''. It says, ``Let's Be Fair
with Our Comparisons'', and it is a report that just came out
today. I haven't even read it.
Chairman Gilman. What is the date on that report?
Mr. Hall. October 27th.
Chairman Gilman. We will be pleased to make it part of our
record, without objection.
We want to thank you, Mr. Hall, for your time and for being
here with us and for your observations which I am certain will
be of help to our Committee. Thank you, sir.
Mr. Hall. Thank you, Mr. Chairman.
[The information referred to appears in the appendix.]
Chairman Gilman. We will now move to our second panel.
I would like to welcome the next panel comprised of
Benjamin Nelson, Director of International Relations and Trade
Issues with the General Accounting Office; and Ms. Gary Jones,
Associate Director for Energy Resources and Science Issues,
Community and Economic Development Division of the General
Accounting Office.
We welcome both of you. Please feel free to summarize your
statements. We will submit your entire statement for the
record. I would ask our Members to withhold their questions
until your testimony is complete.
Chairman Gilman. Mr. Nelson, you may proceed as you wish.
STATEMENT OF BENJAMIN NELSON, DIRECTOR, INTERNATIONAL RELATIONS
AND TRADE ISSUES, GENERAL ACCOUNTING OFFICE
Mr. Nelson. Good morning, Mr. Chairman and Members of the
Committee. I am pleased to be here today to discuss certain
issues relating to food aid to North Korea.
Let me say at the outset, we fully recognize the many
interests that the United States has in connection with North
Korea. While our food aid has been provided for humanitarian
reasons, this is but one of many North Korean issues which are
of interest and concern to the United States.
I also would like to make clear that we recognize the
difficulty of the situation in North Korea. We also understand
the conditions under which the WFP is operating, and I would
like to make clear that we do not doubt that there are problems
in North Korea caused by a food shortage.
The humanitarian challenge in North Korea is real. While
there are differences of opinion regarding the severity of the
conditions, there is no disagreement that much human suffering
has resulted from the past and current food shortage. In
addition, based on available information, it appears that
women, children and the elderly are bearing a disproportionate
share of this human suffering.
The WFP has taken special steps to deal with the challenges
associated with this food shortage, including various
constraints imposed by the North Korean government.
Specifically, they have assembled a comparatively large country
presence and have developed monitoring procedures that are more
extensive than in many other food aid countries. There is
general agreement among U.S. Government and NGO officials that
the WFP is trying hard and doing well under very difficult
circumstances. Moreover, there is evidence that outside food
aid is making a difference, especially in the case of
malnourished children.
Given this background and, hopefully, the required context,
I would now like to address the primary subject of my
testimony, namely, what is being done to provide accountability
for U.S. Government donated food aid to North Korea. My
statement is based on the results of our recently issued report
to this Committee on that subject.
As has been established, the United States is one of the
largest donors of food aid to North Korea, with cumulative
donations of about $365 million since 1996, and most of this
aid is channelled through the United Nations World Food
Programme. The U.S. Department of State says that this food aid
is being provided for humanitarian purposes, but believes that
donations may also improve the climate for bilateral relations
generally.
Our charge was, first, to examine whether the WFP can
adequately account for U.S. Government donated food aid to
North Korea and, second, to prevent possible diversions of food
aid to the military and ruling elite. I would like to point out
that we were not tasked to determine whether food aid is
needed, the impact of the food aid, the living conditions of
the citizens of North Korea, nor whether the food aid program
should be continued.
In short, the answer to the specific questions that we were
asked to address, recognizing that context is always needed for
policymakers, the simple answer, the inescapable answer, is
that the WFP under current conditions cannot provide assurance
that the food is being stored and used as planned. That is our
primary conclusion, and I believe that any analysis of the
facts we observed would lead to that same conclusion, and it is
consistent with the views of numerous other organizations who
have experience in North Korea.
I would like to point out that we base the conclusion that
the WFP doesn't have reasonable assurance upon three basic
building blocks. The first one is that the North Korean
government limits the ability of the WFP to assure
accountability. The government controls the distribution of
food and restricts the WFP's ability to monitor how the food is
used. In other words, there are no independent checks on
locations where food is distributed. Independent, random visits
are not permitted, and the WFP is working in an environment
where it does not have complete information about the number,
name and location of institutions or the number of
beneficiaries.
The second major reason is the limitations in the tracking
system that is used in North Korea. While food is tracked from
the port to country warehouses, deliveries to institutions that
actually distribute the food are not tracked.
The third principal reason is that the North Korean
government has not provided the kind of audit reports that are
normally found in a food aid situation. The government to date
has not provided a single one of the reports that are required
in the agreement with the WFP.
In conclusion, Mr. Chairman and Members of the Committee,
the WFP and U.S. officials have emphasized that there is no
evidence of significant diversions to military or government
elite. However, due to North Korean constraints, the WFP is
unable to provide independent assurance that food aid
distributed by North Korean authorities is reaching targeted
beneficiaries, and we view this as an essential element of
accountability over U.S. donations. We make recommendations
aimed at improving accountability by using diplomatic means to
encourage North Korea to allow greater oversight and by
encouraging the WFP to provide comprehensive and timely
reporting on food aid distribution within North Korea.
Mr. Chairman, this concludes my opening statement. I will
be pleased to answer any questions about our work or any of the
other matters that have been raised here today regarding the
GAO.
Chairman Gilman. Thank you, Mr. Nelson.
[The prepared statement of Mr. Nelson appears in the
appendix.]
Chairman Gilman. Ms. Jones.
STATEMENT OF GARY L. JONES, ASSOCIATE DIRECTOR FOR ENERGY,
RESOURCES AND SCIENCE ISSUES, COMMUNITY AND ECONOMIC
DEVELOPMENT DIVISION, GENERAL ACCOUNTING OFFICE; ACCOMPANIED BY
PHILLIP THOMAS, EUGENE E. ALOISE AND RICHARD SELDIN
Ms. Jones. Thank you, Mr. Chairman.
My remarks this morning are based on our report on the
status of heavy fuel oil delivered to North Korea under the
October 1994 U.S.-North Korea Agreed Framework. I want to
discuss the two areas we reported on.
The first area is the status of heavy fuel oil funding and
deliveries. As of July 31st, 1999, 1.9 million metric tons of
heavy fuel oil had been delivered to North Korea at an
approximate cost of $220 million. Contributions by the United
States, the European Union and 21 other countries, as well as
loans, financed these purchases.
For the first 3 years of the 1994 Agreed Framework's
implementation, shipments to North Korea were not regular and
predictable because KEDO did not always have sufficient
funding. For the past 2 years, shipments have been more regular
due to increased funding from the organization's members and
other countries and decreasing commodity and freight prices.
However, a recent rise in these prices resulted in KEDO
requesting additional funds to pay for this year's remaining
scheduled deliveries. The United States provided a little over
$18 million to cover these deliveries, bringing the total U.S.
contribution for fuel oil purchases to about $157 million.
The second area we reported on is the controls in place to
detect the diversion of heavy fuel oil and any limitations to
these controls. The U.S. State Department and KEDO began
implementing a monitoring system in 1995. The purpose of this
system is to ensure that the seven North Korean heating and
electricity generating plants that are authorized to use KEDO-
supplied oil use it only for heating and electricity
production. KEDO's portion of the monitoring system consists of
meters that measure the flow of heat to boilers, recorders that
compile daily and cumulative information on flow rates, and
periodic monitoring visits to each plant.
KEDO has experienced recurring problems with its monitoring
system. Monitoring equipment installed at each of the seven
sites did not work at various times since it was installed.
However, neither KEDO nor its contractor, Fluor Daniel, has
found evidence of tampering with the equipment that could have
caused these outages. Rather, they attributed these problems to
power outages and widely fluctuating electrical frequency at
the facilities that is akin to power surges and drops.
Equipment that was initially installed to compensate for the
fluctuations did not completely fix the problem. However, KEDO
hopes that more advanced equipment recently installed will
allow for continuous monitoring.
KEDO's monitoring system by itself is not designed to
provide complete assurance that the heavy fuel oil delivered to
North Korea is being used as prescribed by the 1994 Agreed
Framework. For example, KEDO does not monitor the tanks and
excavated open pits that store some KEDO-supplied heavy fuel
oil at delivery ports and at plants where it is being consumed.
Also, monitoring equipment is not installed on the numerous
rail cars and pipelines used to transport the heavy fuel oil
from the delivery ports to storage, then to the plants where it
is consumed.
A January through April, 1999, outage of KEDO's monitoring
equipment at the Sonbong Thermal Power Plant illustrates the
limitations of KEDO's monitoring system. During this period,
North Korean data, which was all that was available since
KEDO's flow monitors were not working, reported that heavy fuel
oil was being consumed at levels substantially exceeding those
historically recorded at Sonbong. North Korean data were based
on the levels of heavy fuel oil in the plant's storage
facilities. However, since flow meters didn't work and KEDO
does not monitor storage facilities, it could not verify North
Korea's statistics or their explanation as to why the oil
consumption was high.
To supplement KEDO's monitoring system, the U.S. Government
uses national technical means to provide additional confidence
that the heavy fuel oil is being used for heating and
electricity generation. The U.S. State Department reported to
the Congress in March, 1999, that KEDO's monitoring system,
along with these national technical means, give the Department
confidence that the heavy fuel oil has largely been used as
prescribed by the 1994 Agreed Framework. While they admit that
it is theoretically possible to extract other types of fuel
from this oil, State Department officials believe that the
process would produce such a small amount of more useful fuel
that there would be little incentive to do so. State Department
officials have acknowledged that over 5 years perhaps 5
percent, or 75,000 metric tons, of heavy fuel oil has been used
for unauthorized purposes. According to State, however, there
is no clear evidence of any significant diversion to
unauthorized purposes.
Thank you, Mr. Chairman. That concludes my remarks.
Chairman Gilman. Thank you very much.
[The prepared statement of Ms. Jones appears in the
appendix.]
Chairman Gilman. Did any of our other panelists wish to
testify?
In that case, I note that your work did not include a visit
to North Korea, Mr. Nelson, to perform independent checks on
food distribution locations. What were your efforts to try to
get into North Korea, and what was the disposition of those
efforts?
Mr. Nelson. Mr. Chairman, we did try to visit North Korea,
but I would like to put the visit in perspective. We tried to
visit North Korea, and we were supported by the U.S. State
Department, as well as the World Food Programme, but we were
ultimately denied visas.
We were working to produce a report in time that was needed
by the Congress, and we put forth a great effort.
Unfortunately, we were not allowed to get in.
But the fact that we did not visit North Korea does not
diminish the quality of our findings and observations. If we
had gone to North Korea under the same conditions that the WFP
has to operate under, we would have been controlled, and we
would not have had independent access to the distribution
facilities.
So, under this scenario, normally it would be GAO's
practice to visit locations to see firsthand what is going on,
but typically we have freedom of access or we have the ability
to select the locations that we visit. In this particular case,
we would not have had the freedom to do so. However, I must
admit that a visit would have been beneficial in that we would
have had a firsthand observation.
Chairman Gilman. Mr. Nelson, have you had an opportunity to
monitor food distribution in other countries where we provide
aid? Has your agency monitored or assessed the competency of
our food aid to other countries?
Mr. Nelson. That is correct, Mr. Chairman. GAO has done
extensive work in this area and has monitored specific food aid
efforts in different locations. The primary difference in this
case is the independence and the access.
In the other food aid countries, the WFP and other
officials have much more freedom to select the institutions, to
do random spot checks and to have more control over the
handling and distribution of the food. The reports that we have
seen from all of the members of the consortium that are working
there is that their access to the institutions is limited, and
in some cases, the response to those visits are seemingly
staged such that all of the numbers add up. All of the
statements can support the same type of outcome.
Chairman Gilman. Mr. Nelson, did you have an opportunity to
speak to any of the country directors of the World Food
Programme in North Korea, from North Korea?
Mr. Nelson. Yes, sir, we did. I did not personally speak
with the country director. The members of my team did. Mr. Phil
Thomas, who is on my left here, in fact had quite a lengthy
conversation with the country director. He can respond to any
specific questions you might have or just elaborate on what I
said.
Chairman Gilman. Mr. Thomas, would you be kind enough to
tell us something about that discussion you had with the
country director?
Mr. Thomas. We met with Douglas Broderick when he was on
home leave in July this summer, and essentially it was an
attempt to get general information on the WFP's program.
Chairman Gilman. What did Mr. Broderick have to say about
his capability in monitoring the food aid to North Korea?
Mr. Thomas. That they were constantly working with the
North Koreans to improve monitoring and accountabilities, and
that the system was not perfect but that they were trying very
hard to upgrade the system.
He was an advocate of our getting into North Korea. He
wanted to assist in the approval of our visas, and we were
confident we were going to get in, up until the day before we
were to go and our trip was canceled.
Chairman Gilman. Mr. Thomas, did you ask at the U.S. State
Department for help with obtaining visas for that?
Mr. Thomas. We did.
Chairman Gilman. Did they try to assist you?
Mr. Thomas. That was our understanding, Mr. Chairman. We
spoke to officials at State, AID, USDA, and WFP, and they all
were strongly supportive of our getting into country. I believe
PVOC members were also supportive of us getting into country.
Chairman Gilman. Mr. Hall testified that had you made
sufficient, adequate attempts to get in, you probably would
have been granted a visa. What is your opinion?
Mr. Thomas. We have no prior experience in attempting to
get into North Korea. We tried vigorously to get in, but we
were on a very tight timeframe because we were required to get
a report to you by the end of September or early October. We
had constructed a timeframe to go into North Korea in early
August, and we got the response the day before saying that they
did not want us in. Through intermediaries we were told that
they felt they had enough monitoring and auditing, and that our
trip was unnecessary. We felt it was a fairly strong response.
Chairman Gilman. I understood they listed about 10 reasons
why you would not be granted a visa.
Mr. Thomas. This is correct, but essentially they boiled
down the fact that they were being adequately monitored by the
WFP.
Chairman Gilman. Did Mr. Broderick have any information
with regard to diversion of food assistance?
Mr. Thomas. He did not. He said that there may be minor
diversions, I think as Congressman Hall may have referred to
earlier, but that generally the system was pretty tight.
Chairman Gilman. Thank you very much, Mr. Thomas.
Mr. Nelson, in light of our larger national security and
humanitarian concerns regarding North Korea, what exactly is
the importance of accountability in this case?
Mr. Nelson. Mr. Chairman, I think that has been established
earlier, I believe, by Congressman Hall in that our objective
is to feed the hungry and provide food to those with the
greatest need. Our goal is to provide food for children, women
and the elderly. Accountability is important to assure that
those objectives are being met, that the food is, in fact,
going to those who are most in need, and that is an essential
element for continuing support of the program.
Chairman Gilman. Mr. Nelson, you heard the prior testimony.
One of your investigators was personally attacked. Do you have
any statement you would like to make about that?
Mr. Nelson. Yes, I would, Mr. Chairman.
Chairman Gilman. Please.
Mr. Nelson. First of all, I would like to say that the
assertions that were made concerning an individual of my staff
were thoroughly looked into and found to be without merit.
Second, the GAO product is an institutional product. Every
report that leaves the GAO undergoes a rigorous review by
disinterested third parties, as well as scrutiny by each level
of senior management, by the way, which is a frequent complaint
of the staff, that they have to go through too many hurdles to
get their reports out. Nevertheless, that process has served us
well over the years, and this product underwent the same kind
of scrutiny that any other GAO product would go through. There
are procedures in our process to assure that no one individual
can influence the outcome of a message and that counter
positions are fully disclosed and developed.
So, the allegation involves whether a person at GAO
actually applied for a job at the WFP, and in fact that is
true, but it is irrelevant to the quality of this report.
Chairman Gilman. Thank you, Mr. Nelson.
Mr. Ackerman.
Mr. Ackerman. Thank you, Mr. Chairman.
It is just unfortunate and regrettable that happenstance
has taken place, because it certainly has created a cloud of
confusion, shall we say, as to the veracity of the report
itself.
Despite the fact that it can go through as many procedures
as possible by staff and senior staff, nobody could disagree
with anything that anybody would say in this matter, as a
matter of fact, because nobody has been there. That is
basically the premise of your report, that you couldn't get in
to monitor what the World Food Programme was actually doing.
Isn't that accurate?
Mr. Nelson. That is correct, sir.
Mr. Ackerman. I will do my last question first. Is the
World Food Programme doing a good job in North Korea?
You can look at me. You don't have to look at the Chairman
when you say it.
Mr. Nelson. I would have to say the consensus is they are
doing quite well under very difficult circumstances.
Mr. Ackerman. I will take that as a yes. The
circumstances--they are not able to change the circumstances to
do a better job. Are they doing the best job they can under the
circumstances?
Mr. Nelson. Sir, I wouldn't be able to render an informed
opinion as to whether they are doing the best they can do. What
I can say is that the plan or strategy that they developed for
North Korea would be more aggressive than other situations.
However, we have to go back to my earlier statement that says
they have not been able to implement that plan.
Mr. Ackerman. Through no fault of their own?
Mr. Nelson. Through no fault of their own.
Mr. Ackerman. Is there a way, in your opinion, that they
could have done a better job?
Mr. Nelson. I think there is some discretion regarding
whether to delay a shipment or to impose other penalties that
the WFP could possibly use, but I think overall, the consensus
is they are doing a fairly good job there.
Mr. Ackerman. That is a very important statement, and I
appreciate that.
You say that you were under a time constraint to get this
report to the Chairman. You said before, in answer to his
question, that you were basically rushed. Why were you under a
time constraint to rush this report to the Chairman?
Mr. Nelson. Mr. Congressman, I don't believe I said that we
were rushed.
Mr. Ackerman. You said, ``we operated under a time
constraint, as you know, Mr. Chairman, to get this report to
you''.
Mr. Nelson. Yes.
Mr. Ackerman. Why were you rushed to get the report to the
Chairman?
Mr. Nelson. Congressman, we try to honor the requests that
we get from you all regarding when you need a particular
product, and we work with you on the scope of work.
Mr. Ackerman. Did you advise the Chairman, or is it
anywhere in the report, that you could have done a better job
had you not been rushed?
Mr. Nelson. No, sir, it is not, because I believe that the
product we produced will meet all of our relevant standards for
both quality of evidence, clarity of presentation, as well as
sources of information.
Mr. Ackerman. Could you tell us what percentage of the food
is diverted to the army?
Mr. Nelson. We have no information that food is being
diverted to the army.
Mr. Ackerman. None whatsoever?
Mr. Nelson. We are not aware of any.
Mr. Ackerman. Can you tell us what percentage of the oil is
being diverted to the army?
Ms. Jones. We could discuss that with you, Mr. Ackerman, in
a different venue.
Mr. Ackerman. I appreciate that, but there is no way of
telling what amount of food, if any, is being diverted to the
army. I think that you have run into the same problem that the
World Food Programme has run into, that the U.N. has run into,
that the IAEA has run into, to walk North Korea back from the
precipice of nuclear calamity, and that is, you really can't
get in. You do know that there are starving people in North
Korea?
Mr. Nelson. Yes, sir, that is very well established.
Mr. Ackerman. Very well established. You do know it is the
policy of this country to try to assist those people that are
starving?
Mr. Nelson. I understand that, sir.
Mr. Ackerman. We are doing that to the best of our
ability--the World Food Programme is, as you said before, to
the best of their ability under the circumstances?
Mr. Nelson. Under the circumstances.
Mr. Ackerman. I appreciate it. Thank you very much. Your
testimony has been very helpful today.
Chairman Gilman. The gentleman's time has expired.
Mr. Knollenberg, who is here with us from the Foreign
Operations Subcommittee of the Appropriations Committee, and
also serves as a Member of the Speaker's Task Force on North
Korea. Mr. Knollenberg.
Mr. Knollenberg. Mr. Chairman, thank you very much. I
welcome the panel.
I want to focus on the oil issue, specifically the
diversion matter. I appreciate the idea that we can get some
facts on the table regarding the Administration's policy with
North Korea. I know some Members have expressed concerns about
partisanship in this process, but, when the dust settles from
all of that, I am afraid we all have no choice but to deal with
the facts. Having been, as the Chairman mentioned, a Member of
the Appropriations Subcommittee on Foreign Operations since we
first started funding the Administration's 1994 Agreed
Framework, I would like to point out two facts pertaining to
U.S. law regarding aid to North Korea.
First: By law, in order for U.S. aid to be disbursed to
North Korea in the form of KEDO-supplied heavy fuel oil, North
Korea must be, ``complying with all provisions of the Agreed
Framework''. Now, that fact should seem logical enough.
Congress is simply requiring North Korea to live up to the
provisions it agreed to in 1994. This condition has been
included in the Foreign Operations Appropriations Acts since we
first began appropriating aid to North Korea through KEDO.
Second: The 1994 Agreed Framework specifically states that
KEDO-supplied heavy fuel oil shall only be used for, ``heating
and electricity production''. In other words, any use of this
oil for purposes other than heating or electricity production
constitutes a violation of the 1994 Agreed Framework.
If we put these two facts together, we have some simple
logic I think that anybody can understand. Under current law,
if North Korea diverts KEDO-supplied heavy fuel oil to purposes
outside of the 1994 Agreed Framework, U.S. aid to North Korea
through KEDO must cease. So the question that we must ask today
is, has oil been diverted? If the answer is yes, U.S. law says
we have to stop giving aid to North Korea. Again, this is a
simple fact. It is counter to U.S. policy.
Regarding the question of diversion, Ms. Jones, I would
like to ask you about GAO's investigation. According to the
report, the U.S. State Department officials have acknowledged
there is evidence that some of the heavy fuel oil has been
diverted. However, the report also states that, according to
the State Department, there is no clear evidence of any
significant diversion to unauthorized purposes of the 500,000
metric tons of heavy fuel oil that is delivered annually to
North Korea. The question I would like to get to here is, what
is the State Department's definition of significant? The State
Department says there has been some diversion, but it isn't
significant. I must say, this inconsistency deeply concerns me
and, I think, many people. So the question, Ms. Jones, is, did
the State Department offer GAO any further explanation of their
definition of a significant diversion?
Ms. Jones. Mr. Knollenberg, in the course of our work in
trying to determine what significant meant, you look at the
legislative history and the law itself, and there was no
definition. So we went to the State Department to try to
clarify what their criteria would be in terms of defining
``significant''. The U.S. State Department does not have
criteria for that, but in discussing it with State Department
officials, one told us that he would say that maybe 100,000
metric tons in one given instance could be considered
significant, or if it was given to the military it might be
considered significant. However, he also said that you could
drive a truck through the word ``significant'' from a
definitional standpoint.
Mr. Knollenberg. So is 5 percent significant? Is 25 percent
significant? Does it have to be 100 percent to be significant?
I guess close enough for government work--is that what we are
looking at? Now, what is GAO's definition of significant?
Ms. Jones. I would not try to define the word
``significant'' as it applies to this legislation. That would
not be our role to do that.
Mr. Knollenberg. I believe it is clear this report contains
significant evidence of significant diversion. Given its
evidence and consistence with U.S. law, aid to North Korea
should cease, and I urge my colleagues, the Administration and
the American people to consider this report very, very
carefully before we spend any more money to aid North Korea.
Mr. Chairman, I yield back.
Chairman Gilman. Thank you, Mr. Knollenberg.
Mr. Gejdenson.
Mr. Gejdenson. Thank you.
First, I would like to go to their use of heavy fuel oil.
Is that No. 6? Is that what it is, generally?
Ms. Jones. Excuse me, No. 6?
Mr. Gejdenson. Is that what it is generally referred to in
the oil business?
Ms. Jones. It is at the bottom of the rung, yes, sir.
Mr. Gejdenson. So it is very heavy. It has to be heated to
be used.
Ms. Jones. Yes, sir.
Mr. Gejdenson. Can it be refined for diesels or other
things?
Ms. Jones. It can be refined, but it takes an awful lot to
get it there.
Mr. Gejdenson. It is a low-grade oil used generally in
furnaces?
Ms. Jones. Correct.
Mr. Gejdenson. If there was a diversion, it was diverted to
heat something else or generate electricity someplace else. You
are not making rocket fuel out of this? You are not making
gasoline? You are not making diesel oil?
Ms. Jones. Typically, heavy fuel oil is used for heating,
that is correct.
Mr. Gejdenson. I would like to ask Mr. Nelson, is there any
way that you can estimate what is happening to the people in
Korea as far as their diet situation since the food aid has
begun? Has there been a general improvement, has it stayed the
same or has there been a deterioration for the general public
since the food aid program has begun, Mr. Nelson?
Mr. Nelson. Congressman, there have been reports by
different individuals of improvement in the health condition of
children in particular. There have also been reports of
increased attendance at schools where there is food aid.
However, there has not been a broad, comprehensive survey of
the impact of the food aid that we are aware of.
UNICEF conducted what we call a baseline study, and had
intended to follow up in cooperation with the WFP each year to
try to determine the impact. However, the government has not
permitted this second survey to take place. So the evidence is
anecdotal, and it is the findings of different individuals,
including Congressman Hall, who have visited North Korea.
Mr. Gejdenson. As for the transparency or the lack of
transparency in North Korea on the food program or the oil
program, we actually have more visibility--there is more
transparency in these two programs than almost anything else
the paranoid isolationist government in North Korea allows for.
Is that a fair assessment?
Generally, we have a society here that has blocked off all
contact with the world. Yet in these two areas, we have had
some monitoring, imperfect as it is, that is interrupted or
what have you, and we have had some reviews, but it is better
than the rest of the information we get on the rest of society;
is that a fair assessment?
Mr. Nelson. Congressman, I have no basis to comment on that
particular statement.
Mr. Gejdenson. Let me ask you a little more precise
question. Ms. Jones, your sense is yes? We get more information
about the oil that we send them than the general information we
get about North Korea?
Ms. Jones. As Mr. Nelson said, I wouldn't have the
information to be able to respond to that directly.
Mr. Ackerman. Would the gentleman yield?
Mr. Gejdenson. Yes, I would be happy to yield.
Mr. Ackerman. Are there not meters on the flow of oil such
that you can actually come up with numbers?
Ms. Jones. That is correct.
Mr. Ackerman. There are no meters on anything else?
Ms. Jones. That, I don't know.
Mr. Gejdenson. Reclaiming my time, I guess that you haven't
done a report. I am not trying to put you in a box, but it
seems to me anybody who has read a newspaper in the last 30
years recognizes it is a very closed society. We get virtually
no information out of that society, and in these two instances,
while we have imperfect information, we get more information
than we generally get out of North Korea. I can tell you that
because I read newspapers, not because of any particular,
secret reports that I have read from the intelligence
community.
I think you have done your job as you were instructed to do
it. I think that what we in Congress have to decide is what is
the next best alternative course. I think there is a general
agreement we would all like more information from the North
Korean government. I think there is general agreement we would
like to see a nice democracy with freedom of speech and a free
market so the people in North Korea wouldn't be starving. The
question is, how do we get from where we are, a country that
has imposed isolation on itself, that has caused the death of
hundreds of thousands, maybe millions, of its people through
starvation, and has threatened both its immediate neighbors and
now potentially even neighbors some distance away?
We are involved in a policy with our allies in the region,
the South Koreans, Japanese, and others, where there is a sense
that we are doing the right thing.
I would just ask if there are any recommendations from any
of the panel Members on what actions we could take that might
give us the kind of response that, I think, we all would like
to see, which is more information and more openness. Let's
start maybe with Eugene here and work our way down. Are there
any proposals that you think that we have a reasonable
expectation of succeeding in that we might demand more
information from the North Koreans?
Mr. Aloise. In terms of the heavy fuel oil, which is what I
could speak to, they are making progress in upgrading those
meters.
Ms. Jones. I think in terms of our work on the 1994 Agreed
Framework, we have done a number of reports on that. What we
have said is basically the North Koreans have certain
commitments that they are making, and that we should make sure
that they are standing to those commitments.
Mr. Nelson. As we say in our report, I think one of the
things that we can do, given the very difficult circumstances
and our broad interests there, is to recognize that food is
very important, and continue to push for greater access and
more independent monitoring in light of the fact that we need
continued public support for the program. We need to make it
clear that it is in the interests of North Korea to provide us
with greater access.
Mr. Thomas. The Executive Director of the World Food
Programme, Catherine Bertini, recently went to North Korea.
Part of her visit has always been to emphasize greater
cooperation, more transparency, more participation in
monitoring and accountability, and we would encourage that to
continue. We think that is very important, and we think
implementation of our recommendations would also be a step in
the right direction.
Thank you.
Mr. Gejdenson. Thank you.
Chairman Gilman. Thank you, Mr. Gejdenson.
Mr. Sherman.
Mr. Sherman. Yes. I would like to focus a little bit on
diversion and substitution. As previous questioners have
elicited, we provide 500,000 metric tons of this very heavy
sludge No. 6 oil. Do we have any reason to believe that North
Korea has even the capacity to take that sludge and refine it
into gasoline? Do they have the kind of refinery that could
even try to do that?
Ms. Jones. Mr. Sherman, we would be happy to discuss that
with you in a different venue.
Mr. Sherman. Second, that 500,000 metric tons, how does
that compare with the amount of oil that North Korea imports on
its own?
Ms. Jones. The 500,000 metric tons a year is about 45
percent of North Korea's annual needs.
Mr. Sherman. Does North Korea import its own No. 6 heavy
oil with its own money?
Ms. Jones. I believe they do, yes.
Mr. Sherman. It would be kind of silly then for--I am not
going to withdraw the question about them trying to refine the
No. 6 into fuel because they wouldn't have to. The very fact
that they are importing No. 6 with their own cash proves that
they are using all the No. 6 for No. 6 purposes. The No. 6 we
give them for No. 6 purposes which, as you have previously
testified, is for the generation of heat, mostly for electric
generation. So there doesn't seem to be any material diversion
going on there. I am sure that if they are buying with their
own cash No. 6 oil, they must be using all the No. 6 oil we
give them for No. 6 purposes.
As to the issue of food, as I understand our agreements
with North Korea, they are free to move into any village, take
all of the agricultural produce from that village, and use it
for their military, the Communist Party or the elites, and to
provide that village with aid in substitution for the 100
percent tax or taking of the grain produced by that village.
Now, as I understand it, our aid is only supposed to go to
children under eight, mothers and the elderly, but those folks
all live in families. So if you are providing aid to them, you
could be providing aid to every peasant family in that village,
or in all of the villages of North Korea.
Given this, does it make any difference whether the grain
that we are giving them is used in substitution so the Korean
grown grain can be used for the military or whether it is
diverted? Is there a difference--that it makes a difference?
Mr. Nelson. Of course, food is fungible, and I think you
present a very solid scenario of what might happen.
Unfortunately, we do not have the ability nor did we attempt to
try to make that determination. We looked at the accountability
mechanisms that were in place and rendered a judgment as to
whether they were adequate to assure that the food was reaching
the targeted groups. We had reservations about that system.
Mr. Sherman. But even if we knew that for every sack of
grain that went to any village from us, that another sack of
grain, locally produced grain, was leaving that village and
going to the military or to the elites, it wouldn't be a
violation of our agreements with North Korea, would it.
Mr. Nelson. A member of my staff just pointed out that they
are not food sufficient, so it does make a difference. My
reading of late indicates that there is quite a reserve or
stockpile for the military, but I could not give a conclusive
or a persuasive answer regarding whether it is displacement or
whether it is a substitution and how any diversion would
manifest itself in North Korea.
Mr. Sherman. The food aid we provide is what percentage of
the total food consumed in North Korea?
Mr. Thomas. It is about one-fourth.
Mr. Sherman. So it would be a significant amount of moving
of grain to take one quarter of all the grain to be consumed in
the country, distribute that out to villages, then go to those
villages and extract one-fourth of the total grain in the
country. How much does North Korea import with its own cash?
Mr. Thomas. A very small amount, approximately, I think,
300,000 tons. It imports about 1.4 million tons perhaps, and it
relies on food aid up to over a million tons.
Mr. Sherman. That is a million tons of aid?
Mr. Thomas. Right.
Mr. Sherman. Imports with its own cash at about what level?
Mr. Thomas. Three hundred thousand tons.
Mr. Sherman. Three hundred thousand tons, and then
production inside the country of roughly 4 million or 3
million?
Mr. Thomas. 3.5 I think someone said. These are very rough
figures.
Mr. Sherman. Has my time expired?
Chairman Gilman. The gentleman's time has expired.
Mr. Sherman. Thank you.
Chairman Gilman. Mr. Knollenberg.
Mr. Knollenberg. Thank you, Mr. Chairman.
I want to now focus on the monitoring system for the heavy
fuel oil. Here is a country that has refused to make any type
of reforms. I know Congressman Hall has done a great number of
good things, and he continues to be, I think, an advocate for
the right thing, but I would remind everybody that this is the
most oppressive country in the world. As they have the highest
rate of violations for human rights, they have made no
societal, economic, or agricultural reforms, this KEDO issue
comes to mind now.
By law, in order for U.S. aid to be disbursed to North
Korea, Congress has to be certain that KEDO-supplied heavy fuel
oil is not being diverted to purposes outside the 1994 Agreed
Framework. Although KEDO has a monitoring system in place,
which I am going to talk about, the system is limited in the
information it can provide. According to the GAO report, which
I have, ``there are no arrangements with North Korea for
monitoring the large quantities of heavy fuel oil in storage or
in transit to the plants consuming the heavy fuel oil''.
Ms. Jones. That is correct, sir.
Mr. Knollenberg. It goes on to state that monitoring
equipment is not installed on the numerous railcars and
pipelines used to transfer that heavy fuel oil from the
delivery ports to storage, and from storage to the plants where
the heavy fuel oil is to be consumed.
Ms. Jones. That is correct.
Mr. Knollenberg. So after reading this report, it seems to
me that there are some very, very large holes in KEDO's
monitoring system. Would you agree?
Ms. Jones. Those are holes in KEDO's monitoring system that
is correct, but it was not designed to give complete assurance.
Mr. Knollenberg. I think that last statement is what I am
looking for. It was not designed to give 100 percent assurance.
Ms. Jones. That is because they had complementary national
technical means to help with that assurance.
Mr. Knollenberg. Under the current KEDO monitoring system,
what assurances do we have that oil is not being diverted
through storage or transit?
Ms. Jones. I think that the U.S. State Department has
admitted to a 5 percent diversion. Anything other than that,
Mr. Knollenberg, we would be happy to discuss with you in a
different venue.
Mr. Knollenberg. I understand.
Under the current KEDO monitoring system, that we have in
place, designed as it is, I could say flawed, but designed as
it is, will the President ever be able to certify whether oil
is being diverted?
Ms. Jones. We can't just rely on the KEDO system. It was
not designed to do it by itself.
Mr. Knollenberg. Couldn't the North Korean army, for
example, intercept a railcar, take some oil out and send it on
its way?
Ms. Jones. I assume that that could happen.
Mr. Knollenberg. They have been very, very limited in what
they will allow us to inspect or to see. In fact, that has
been, I think, where they haven't been living up to their
commitments since the 1994 Agreed Framework was initiated.
Ms. Jones. In terms of the oil monitoring, or are you
talking about other issues?
Mr. Knollenberg. I am talking specifically about how the
design of the agreement literally allows for these holes, and
that we can't be assured in any way that there isn't diversion
taking place because there is no monitoring system in place
during the transit of oil in railcars, and that kind of thing.
Ms. Jones. I think, Mr. Knollenberg, that the KEDO system
is looked at as really one tool in a toolbox in terms of the
ability to determine if there are diversions. When you couple
the KEDO system with a national technical means, there is a lot
more confidence in terms of what is going on.
Mr. Knollenberg. I know my time is running out here, but
can you very briefly give us an idea as to how we might improve
this monitoring system so that we would be able to offer some
assurances of certification that they are living up to the
agreement? What would have to be done?
Ms. Jones. I think, first, that KEDO has made strides in
terms of the monitoring system by putting in the power surge
protectors, the power conditioning machine that is allowing----
Mr. Knollenberg. That is new now?
Ms. Jones. That is fairly new, yes, sir. In fact, they are
kind of on their second generation and are hoping that it is
going to be much more workable to ensure that there is
continuous monitoring.
They have also put in systems, I think it was after March,
1997, which basically are kind of solid state systems where
when the KEDO monitors come in periodically, they can download
this information. It is not just the paper runs. They basically
have some information off a computer, which, again, will give
them more information and better information. So KEDO has made
great strides in terms of their monitoring system to make it
more effective.
Mr. Pomeroy. Will the gentleman yield?
Mr. Knollenberg. Sure.
Mr. Pomeroy. I know the gentleman's time has expired, and
he will be departing soon to the Appropriations Committee on
which he serves, but before he leaves this Committee I would
like to ask the gentleman, serving as the distinguished co-
chair of the Speaker's Advisory Group, whether or not your
report on the matters before the Committee this morning is
completed and if we might have a copy of it?
By way of background, Joe, I understand that the National
Journal has been given a draft report, and it would just seem
in fairness, that the Democrats ought to have a report.
Chairman Gilman. Before the gentleman yields, let me just
clarify. The report has not been given to the National Journal.
They were shown one paragraph inadvertently. It has not been
released yet. It goes to the Speaker first, and he will be
making a release within the next few days when the report is
finally completed. At this point, it is not final status.
Mr. Knollenberg.
Mr. Pomeroy. In light of that helpful information, Mr.
Chairman, either of you could respond to this, if you would.
The National Journal reported that the report alleges
significant diversions, quote, unquote, of food and fuel aid.
The GAO has told us that has not been substantiated. Is that in
your report or is that being subject to revision?
Mr. Knollenberg. I yield again to the Chairman. Whatever
the Journal editor reported was something they gathered on
their own, but the Chairman has already spoken to the specifics
of what we have released.
Chairman Gilman. The Journal reporter spoke to one of our
staff, and there has not been a formal release. He has not seen
the full report. The report is still in the final stages of
completion. Hopefully, within a few days there will be a
submission by the Task Force to the Speaker, at which time he
will disseminate a report to the Congress.
Mr. Pomeroy. I thank you, Joe.
Mr. Knollenberg. I would just like to conclude.
I think that both sides of the aisle should focus on the
facts which are emerging here, and let those facts be our guide
to not only how we develop policy, but also to our insistence
on finding out, through transparency--which has not been a part
of North Korea's policy--just what is taking place.
I will conclude with that. I yield back my time. I thank
the panel very much for their testimony this morning.
Chairman Gilman. Are there any other questions before we
release the panel?
Mr. Ackerman. Yes.
Chairman Gilman. Mr. Ackerman.
Mr. Ackerman. Mr. Chairman.
Mr. Seldin. My name is Richard Seldin. I am counsel to the
group, and I wanted to make----
Mr. Ackerman. You are counsel to?
Mr. Seldin. The GAO group on these two reports.
One of the points I wanted to make in response to
Congressman Knollenberg is about the 1994 Agreed Framework and
the pledges. The pledge on the oil is a very broad pledge. It
just talks about heating and oil production. So in terms of
determining what a significant diversion is, looking back to
the 1994 Agreed Framework, it is very difficult to really
determine that because there are no criteria provided. There is
no definitional material in the 1994 Agreed Framework.
Mr. Knollenberg. Would you say the agreement was flawed by
design in that regard?
Mr. Seldin. It is a nonbinding political agreement, and I
think both countries wanted some leverage, that is true.
Mr. Knollenberg. I gather from what you have just said that
there was something missing then. The latitude being granted by
that language, as you state, suggests to me that it was drawn
up purposely to allow for the inability to monitor what goes on
in North Korea.
Mr. Seldin. I can't answer that. I am not sure about the
diplomatic history of the negotiations regarding the 1994
Agreed Framework.
Mr. Knollenberg. I thank you.
Chairman Gilman. Thank you, Mr. Seldin.
Mr. Ackerman.
Mr. Ackerman. Thank you, Mr. Chairman.
The word ``significant,'' I believe, was left out by design
to allow some latitude. Nobody wanted to box anybody in.
We can't guarantee the delivery of anything with 100
percent certainty. Go to any of our airports and they talk
about how much merchandise is lost at the airport by design,
not just accidentally. I go to the garment center, and they
talk about shrinkage. It is all built into the cost of doing
business. I am absolutely astounded that the assertion here is
not that the glass is half full or half empty, but rather that,
even though we can't monitor it, at least 95 percent of the
fuel oil is going where it should be.
It was asserted before that, in answer to a question by our
colleague, Mr. Knollenberg, as to weather the army have taken
and diverted 5 percent of the oil, that they could have.
Ms. Jones. No, I think what Mr. Knollenberg asked is could
they take a railcar off-line and divert the oil that was in
that railcar. It wasn't the 5 percent issue. It was basically
could they divert a railcar.
Mr. Ackerman. Do you have any evidence that they diverted
any railcar?
Ms. Jones. We could discuss that in a classified venue, Mr.
Ackerman.
Mr. Ackerman. Do you know the answer to the question?
Ms. Jones. I could discuss that in a different venue, Mr.
Ackerman.
Mr. Ackerman. You can say that you know the answer or don't
know the answer without giving the answer.
Chairman Gilman. Mr. Ackerman, you are not badgering the
witness, are you?
Mr. Ackerman. I just wanted to know if they know the
answer, so I don't have to go to a meeting in which I am told
we don't know the answer.
Chairman Gilman. I think the witness has said she would
discuss at a different venue, indicating it may be classified.
Mr. Ackerman. You are reading my playbook. Thank you very
much.
Could a group of bandits from Paris have snuck into the
country and diverted the oil from a railcar?
Ms. Jones. I am not sure that we want to write a novel
here, Mr. Ackerman. I am not sure that would be appropriate for
me to respond to that.
Mr. Ackerman. Is it possible that that could happen?
Ms. Jones. I wouldn't want to respond to that. I would have
no idea.
Mr. Ackerman. You do have an idea of whether or not the
army diverted a railcar?
Chairman Gilman. Mr. Ackerman, the witness has already
responded to your previous question.
Mr. Ackerman. What would the army do with grade six heavy
sludge? Without giving away any great national secrets, what
could they do with this sludge besides bathe in it?
Ms. Jones. I don't know the capacity in North Korea to
refine the oil, the sludge. Sludge is usually used for heating.
Mr. Ackerman. That is correct. Could the army use it for
anything other than heating? Does the army have the capacity to
refine the oil? Do you know any of the answers?
Ms. Jones. I don't know that, Mr. Ackerman.
Mr. Ackerman. So, it is quite possible that, even if the
army did divert a railcar with sludge, that it is very likely
they couldn't do anything with it to begin with, even accepting
the speculation that they could have; is that accurate?
Ms. Jones. I don't know what they could do with the oil. I
don't know what capacity they have.
Mr. Ackerman. Nobody has asserted anywhere that the army
has the capacity, or nobody believes the army has the capacity
or their own refineries, and that is probably absolutely
accurate from what I know.
I thank you very much for helping us today.
Chairman Gilman. Gentleman's time has expired.
Any further questions? Mr. Pomeroy.
Mr. Pomeroy. My first question would be for either Ms.
Jones or the counsel from GAO relative to the 1994 Agreed
Framework. In particular, in response to the last statement of
clarification to Mr. Knollenberg, I believe you indicated that
there was a broad political framework and whether or not there
were benchmark achievements was impossible in light of the
general nature?
Mr. Seldin. I didn't say that they were impossible, but
that is how the agreement was drawn up.
Mr. Pomeroy. Secretary Perry has told us--Secretary Perry,
former Secretary of Defense, has served as Special Advisor to
the President and the Secretary of State by heading a
commission congressionally charged to review policy to North
Korea. Among his formal findings, they have been presented to
this Committee as well, is that there has been no production of
fissile material at Yongbyon since the 1994 Agreed Framework
came into force. Does GAO know whether or not that is an
accurate statement?
Mr. Aloise. According to the IAEA, the freeze is in place.
Mr. Pomeroy. Does GAO contest the accuracy of the
Secretary's statement in this regard?
Mr. Aloise. No, we don't.
Mr. Pomeroy. The stopping of production of fissile material
capable of being made into weapons-grade plutonium would seem
to be a measurable, discernible, quantifiable achievement of
some renown or some significance under the 1994 Agreed
Framework. Counsel, would you respond to that?
Mr. Seldin. Yes, I would agree with that.
Mr. Pomeroy. Thank you.
On to the questions relative to food assistance. I must say
that I participated with Mr. Hall in the discussions with Mr.
Walker and with Mr. Nelson relative to the preparation of this
report. I appreciate the fact that the presentation today has,
I believe, helped put into context some of the attendant
circumstances to the report. Let me try to highlight them now.
Does GAO accept reports from sources, be they government or
NGO sources, that there is a significant food shortage problem
in North Korea?
Mr. Nelson. That is correct, sir. GAO does not take issue
with that statement.
Mr. Pomeroy. That malnutrition has been a significant issue
for North Korea?
Mr. Nelson. That is correct.
Mr. Pomeroy. Does GAO note whether or not U.S. military
leaders in South Korea support the effort to provide food
assistance in North Korea?
Mr. Nelson. GAO is not in possession of any direct evidence
that such is the case. However, we have been told by one
individual that he has evidence that the U.S. military supports
the food aid program, but GAO has no direct evidence.
Mr. Pomeroy. You made no inquiry in that?
Mr. Nelson. I made no inquiry in that regard.
Mr. Pomeroy. Does GAO have any information relative to the
position of the South Korean government and the primary
opposition party in South Korea relative to providing food aid?
Mr. Nelson. No, sir, we do not have any information in that
regard.
Mr. Pomeroy. It would seem to me that those very important
stakeholders in this question, the South Korean government, the
opposition party in South Korea and the United States military,
might have been noted in your report for this reason. If indeed
there is significant belief and substantiation of diversion of
food for military sources, it would be contrary to the
interests of both the military and the South Korean government.
Now, the fact that they tend to be supportive of food aid
rather than in opposition might weigh on the question of
whether or not there is diversion of food.
I want to quote to you from a National Journal article
which quotes the much-discussed Special Advisory Report, which
is a Majority party only Task Force on North Korea. Reading
from the National Journal, October 23rd, ``moreover, the report
accuses the North Koreans of, quote, significant diversions,
unquote, of food and fuel donated by the international
community to aid the famine-wracked countryside''.
In your work, and if I read your conclusion correctly, you
indicate that there are not facts to confirm that finding nor
are there facts to disprove that finding; is that correct?
Mr. Nelson. In our review, yes.
Mr. Pomeroy. Based on the GAO's best efforts, you have not
been able to prove significant diversion, you have not been
able to confirm those suspicions; is that correct?
Mr. Nelson. That is correct.
Mr. Pomeroy. Is the GAO aware that the Majority Task Force
has access to some sources that you have not availed yourself
of?
Mr. Nelson. I am not in a position to answer that question.
We are not familiar with the scope of work or the approach of
the Advisory Group.
Mr. Pomeroy. Primarily, the thrust of the GAO report
relative to food aid is that monitoring is a problem; is that
correct?
Mr. Nelson. That is the thrust of our report.
One point I would like to reiterate, Congressman Pomeroy,
is that we did not raise a question of whether the aid should
be provided or the impact of the aid. We were asked to examine
whether there is reasonable assurance that it is reaching the
intended or targeted audience. We examined the accountability
mechanisms which would include the ability to do random checks,
the ability to have unsupervised visits and the ability to
audit distributions. That is our area of expertise, which is a
management area.
Mr. Pomeroy. Mr. Nelson, just to try to draw your
conclusion out here, as I heard you in your opening testimony,
you said you were charged with two tasks, confirming whether
food aid is adequately monitored and confirming whether or not
there have been significant diversions of food aid. As to the
first, you think monitoring could be improved. As to the
second, you do not have evidence of significant diversion,
although you can't say for sure.
Mr. Nelson. That is correct. We do not have evidence of
significant diversion.
Mr. Pomeroy. I am heartened by one aspect of the hearing
today and that is the Chairman's comments that no one is
intending to cut-off food aid. I would certainly hope not in
light of the significant starvation issues that face North
Korea. There is a bill, however, introduced that has conditions
precedent before food aid could be provided. I want to ask you
a couple of those conditions and ask if you have a conclusion
in terms of whether or not you believe these conditions could
be met based on your audit experience in the context of this
audit.
You would have to certify that previous U.S. food
assistance to North Korea has not been significantly diverted
to military use, and you would have to further certify that
North Korea military stocks have been extended to respond to
unmet food aid needs in North Korea. Do you have conclusions in
terms of whether it would be possible to certify as to either
of these?
Mr. Nelson. No, sir, I do not.
Mr. Pomeroy. You have no conclusions.
All right. I thank the panel.
Mr. Chairman, thank you.
Chairman Gilman. Thank you, Mr. Pomeroy.
I want to thank the panelists for being with us and for
your patience and indulgence. You have provided us with
significant information for this Committee's consideration. I
thank our GAO for being present, and for your good work. Thank
you.
We will now proceed to the third panel, but before doing
so, we will take a brief recess.
[recess.]
Chairman Gilman. The Committee will come to order.
I welcome our third panel headed by Dr. Nick Eberstadt,
Visiting Scholar at the American Enterprise Institute. Dr.
Eberstadt recently completed his book, The End of North Korea.
We are glad that Dr. Eberstadt is able to join us today to give
us his perspective on the Korean problem.
We also have Mr. Joseph Bermudez, Senior Analyst for Jane's
Intelligence Review. Dr. Bermudez is an internationally
recognized expert on North Korean defense issues. He is also
the author of an upcoming book on the North Korean armed
forces. We welcome your perspectives on the North Korean
missile program.
Finally, we will hear from Ms. Nancy Lindborg, Executive
Vice President of Mercy Corps International. Ms. Lindborg, we
are glad you are able to join us today to give us your
perspective on food aid from the NGO's' perspective.
We welcome our entire panel. I know that many of you have
appeared before the Congress previously, but for the sake of
time, I would request that you summarize your statements, and
we will have your full statement appear in the record without
objection. As well, I would ask our Members to withhold
questions until all of the witnesses on the panel have
testified.
Chairman Gilman. Dr. Eberstadt, please proceed as you may
deem appropriate.
STATEMENT OF NICHOLAS EBERSTADT, VISITING SCHOLAR, AMERICAN
ENTERPRISE INSTITUTE
Dr. Eberstadt. Mr. Chairman, Members of the Committee and
distinguished co-panelists and guests, it is always a pleasure
and a privilege to appear before your Committee.
I was asked to discuss North Korea's economic prospects and
prospects for aid-linked reform, economic reform in the DPRK
today. Before I summarize my remarks, I should emphasize a
couple of pretty major caveats.
North Korea is a very difficult country to understand. The
DPRK is a very difficult government to understand. It is such a
different government from our own that we often lack the
intuitive linkages that would help us to understand it. Very
little information is available about this country. Some of the
few pieces of information that are available seem to be
contradictory. Finally, not least importantly, the North Korean
government appears to be strongly committed to a policy of
strategic deception, that is to say, to misinforming and
disinforming the outside world about its capabilities and
intentions.
The surprise attack that launched the Korean War in 1950
may be the most well-known of North Korea's efforts in
strategic deception, but it is by no means Pyongyang's only
effort at misinforming the outside world about its intentions
and capabilities.
That being said, I would venture five comments or
observations about North Korea's economic situation and its
prospects.
First, it is widely known that the DPRK is currently in the
midst of an economic catastrophe, but it is important that the
actual nature of that catastrophe be specified. Rampant hunger
is raging in North Korea today. I don't think there is any
contesting that sad fact. But the hunger crisis that we see in
the DPRK today, that is to say, a hunger crisis in a
predominantly urbanized, predominantly industrialized economy
during a peacetime, is utterly unprecedented in the modern
experience.
That hunger crisis speaks not just to agricultural failure.
Modern industrial economies can feed their people even when
they do not produce enough domestic food to meet their
population's needs. North Korea's food crisis is indicative of
a systemwide failure of the entire DPRK economy. This failure,
moreover, did not start with the well-publicized floods, bad
weather since Kim Il Sung's death, or even with the collapse of
Pyongyang's Soviet block sponsors.
The roots of North Korea's current economic catastrophe can
be traced back much further: They go back at least a
generation, to such milestones as the effective North Korean
default on its Western debts back in the mid-1970's. North
Korea's economic travails today are not a recent aberration
but, rather, represent the culmination of a long-standing
development trajectory--the culmination of a particular
development strategy.
Second, North Korea's ongoing economic disaster cannot be
written off as simply a consequence of bad weather or bad luck.
Rather, it is the direct and entirely predictable consequence
of a highly perverse and destructive set of economic policies
and practices, relentlessly pursued and stubbornly enforced.
When one considers the North Korean economic approach--its
adherence to rigid central economic planning; its apparent
penchant for planning without facts; its extraordinary hyper-
militarization; its contempt for and ongoing campaign against
the country's consumers; its disregard for prices in the
allocation of goods and services; its indifference or even
outright hostility toward possibilities for international,
commercial exchange; its insistence on a particularly misguided
variant of food self-sufficiency--we do not need bad weather or
bad luck to explain the results that we see today.
Third, since the country's dire condition is a very largely
predictable consequence of the relentless enforcement of
economic policies that range from the manifestly wasteful to
the positively disastrous, moderating that self-punishing
regimen could be expected to bring an almost immediate measure
of relief to the North's beleaguered economy. The sorts of
measures that might spark the revitalization of the North
Korean economy are hardly secret. The path to renewal and
resumed growth runs squarely through the international economy.
Why then has the DPRK leadership not seized those obvious
options for remedying the economic catastrophe that it so
plainly confronts? Kim Jong Il's continued reticence about
embarking upon a more pragmatic course appears to be a
deliberate and considered decision, one reflecting the DPRK
leadership's assessment and understanding of its own political
system.
I could cite many particular instances, but let me just
cite one pronouncement from DPRK press that occurred last year
after Kim Jong Il's succession to the top state post.
``It is a foolish daydream'' DPRK authorities emphasized,
``to revive the economy by introducing foreign capital, not
relying on one's own strength. If one wants prosperity of the
national economy, he should thoroughly reject the idea of
dependence on outside forces. . . we must heighten vigilance
against the imperialist move to induce us to `reform' and
`opening to the outside world.' `Reform' and `opening' on their
lips are a honey-coated poison.'' As I say, this is hardly an
isolated comment.
Fourth, the DPRK does seem to have an economic strategy to
see it through these perilous times. That strategy lies in
establishing itself as a permanent recipient of government-to-
government transfer payments. At first glance, it might seem
that such a quest for financial aid would be doctrinally
inconsistent with the self-reliance that North Korea espouses.
It is not. From its very founding, the DPRK has embarked on a
perpetual hunt for subventions from abroad.
Today, it would appear that North Korean leadership hopes
to establish itself as an ever-more-menacing international
security threat, thereby compelling its neighbors and, even
better, its enemies, to propitiate the DPRK with a constant and
swelling stream of financial gifts.
This, I should emphasize, is not merely my surmise. North
Korea's intentions have been spelled out in this regard by its
highest authorities. At the same September 1998 Supreme
People's Assembly that elevated Kim JongIl, North Korea's
Government officially embraced a new policy objective, that of
becoming what they call a ``powerful and prosperous state.''
The precise meaning of that slogan was articulated in the
following month, when DPRK media declared: ``The defense
capabilities are a military guarantee for national political
independence in the self-reliant economy.'' They went on to
state, ``The nation can become strong and prosperous only when
the barrel of the gun is strong.'' Let me repeat that, ``only
when the barrel of the gun is strong.'' Credible military
menace, in other words, is now at the heart of North Korea's
economic strategy and its very strategy for survival.
Finally, in the wake of recent events, such as the Berlin
meetings, the lifting of some U.S. sanctions and the release of
the Perry Report, the question arises as to what U.S. economic
relations with the DPRK and what North Korea's international
economic relations may look like.
My own assessment would be that, in purely commercial
terms, this new set of approaches should be expected to have
only small or marginal impacts on North Korea's economic
prospects.
North Korea currently engages in trade not just with the
United States, but with many other OECD countries which do not
have the same restrictive regimes of economic sanctions. Over
the last two decades, North Korea's trade volume, in inflation-
adjusted terms, has substantially declined with that group of
countries. This is not because their total volume of trade has
decreased; of course it hasn't. World trade has been
dramatically expanding. Stagnant OECD-DPRK trade trends,
rather, speak to restrictions on Pyongyang's part.
There are few signs, if any, of high-level commitment to
change the direction of economic policy in North Korea. The
very word ``reform'' is still officially proscribed. There are
various additional indications that I could bring to your
attention that argue for caution or pessimism about the DPRK's
new economic prospects. I would be happy to go into those in
discussion. But the new direction in U.S. policy toward
Pyongyang, by itself, should be expected to bring little
improvement to North Korea's basis economic prospects.
Thank you.
Chairman Gilman. Thank you very much, Dr. Eberstadt.
Chairman Gilman. Mr. Bermudez.
STATEMENT OF JOSEPH S. BERMUDEZ, JR., SENIOR ANALYST, JANE'S
INTELLIGENCE REVIEW
Mr. Bermudez. I would like to thank the Chairman and the
Committee for inviting me to share my thoughts on North Korea.
I would like to preface my remarks with a personal
statement that I am a horrible public speaker, and my comments
will be very brief, but I am very good at answering questions.
Chairman Gilman. We will take you up on that.
Mr. Bermudez. During the past 30 years, North Korea has
pursued a ballistic missile program. It is only in the past 10
years, however, that we have really taken notice of it in that
it has threatened not only our allies, but it is beginning to
threaten us directly.
During the past 15 to 20 years, it has taken that program
and exported the products of the program which has extended its
threat, indirect threat, to other allies than to just the
United States. The rate at which the DPRK has developed its
ballistic missile capabilities is quite astonishing in some
aspects. This could only have been achieved with the assistance
of outsiders, which is of grave concern.
At present, their ballistic missile program consists of
three families--what we call the Scud family, being the Scud B
and Scud C, but which the North Koreans call the Hwasong, which
means Mars, the No-dong family, and the Taep'o-dong family.
I won't go into the details of each because that would take
too long. However, with regard to the No-dong family, if you
look at the time lines of its development and at the time line
of the nuclear program, it is clear that the No-dong was
intended to be the first system to deliver a North Korean
nuclear weapon, had their program proceeded unabated.
The Taep'o-dong family, which is of the greatest concern at
the present time, is very interesting. The Taep'o-dong 1 is a
product of taking a No-dong at the first stage and one of their
earliest Scuds, the Hwasong, to the second stage and just
combining them, quite simply.
The recent test in 1998, in which they combined a third
stage to launch a satellite, resulted in a failed launch, but
demonstrated a number of technologies in which they have skill.
If that system had been used as a ballistic missile instead of
as a space launch vehicle, it would have a range in excess of
4,000 kilometers. If they had done a few other things, it could
have a range of approximately 10,000 kilometers with a 200-
kilogram warhead, not very significant in size, but in range it
actually puts the United States at risk.
The second component of the family, Taep'o-dong 2, has the
ability to reach the United States if it uses a reduced
warhead. It certainly can reach Alaska if everything goes well,
for them that is. If it has a reduced warhead, it can strike
anywhere within the United States.
Current estimates as to the total number of missiles
produced by North Korea run anywhere from 750 to 1,150. Of
those, approximately 300 to 400 have been sold overseas to a
number of states, some of which are quite surprising. These
states include Egypt and Iran. There has been possibly some
cooperation with Iraq, Libya, Pakistan, Syria, the United Arab
Emirates and Vietnam.
Probably the greatest concern about North Korea's program
is that we simply don't know enough about it. Everybody has
talked about the closed nature of North Korean society, and
that is very true. North Korea has also become very adept at
deceiving us and camouflaging its activity.
With that, I want to thank the Committee.
Chairman Gilman. Thank you, Mr. Bermudez.
[The prepared statement of Mr. Bermudez appears in the
appendix.]
Chairman Gilman. Ms. Lindborg.
STATEMENT OF NANCY LINDBORG, EXECUTIVE VICE PRESIDENT, MERCY
CORPS INTERNATIONAL
Ms. Lindborg. Thank you, Mr. Chairman and Members of the
Committee. I appreciate the opportunity to be here today to
talk a little bit about the experiences and observations of the
Private Voluntary Organization Consortium in monitoring a
portion of the U.S. food assistance for North Korea.
The Private Voluntary Organization Consortium, or PVOC, is
a group of U.S.-based relief and development organizations
which was initially organized in response to the crushing food
crisis that in 1996 was reaching famine proportions. There is
ample evidence, as we have heard this morning and has been
cited frequently by the Congress, that the number of deaths
caused by this famine is well more than one million.
Initially five organizations formed the PVOC: Amigos
Internacionales, Catholic Relief Services, CARE, Mercy Corps
International and World Vision. We have now expanded to include
nine organizations, and collectively our agencies represent a
broad cross-section of the American public. Our respective
constituencies have strongly supported our efforts and the U.S.
response to this silent famine that has claimed so many lives
in North Korea. In addition to monitoring food aid, all the
involved organizations have contributed substantial private
dollars for provision of relief assistance.
All of us share the strong conviction that it is imperative
that the U.S. respond to this crisis with food and follow the
policy that a hungry child knows no politics. Our experience in
repressive and closed societies is that it is the children, the
powerless and the elderly who suffer most.
In August 1997, the PVOC first undertook the
responsibilities of monitoring a portion of the food donated by
the U.S. Government. This first mission represented a historic
first step of engagement between the citizens of the United
States and North Korea. Since then, we have sent in a total of
five teams, and the fifth team is in-country now. We have
documented each of the four completed missions to date in
written reports to our donors, as well as frequent briefings
here on the Hill for staffers and Members.
We have been fully transparent in our desire for increased
accountability and improved monitoring, and have identified the
considerable work that needs to be done to bring this program
in line with international monitoring standards. We also
continue to work with our interlocutors in North Korea to
improve the level and quality of monitoring.
We have documented in these donor reports the significant
improvements in our monitoring abilities, as well as our
continued conviction that there remains an urgent need for
continued food aid.
In reviewing our progress since 1997, we have concluded
that each mission has advanced our quest for more accountable
programs and that we have built upon the experiences and
findings of each team to improve incrementally our ability to
monitor the food. In particular, we have increased the number
of monitors and the amount of time they have been able to stay
in the country. We have improved our geographic access within
the county. To date, we have sent in a total of six Korean
speakers, and we have distributed food to a total of some 6
million North Koreans, for which we have received direct and
gracious thanks.
As we review our programs, we see a pattern of evidence
that suggests that the food is reaching the more vulnerable
populations. For example, in 1998, our team reported that they
were told repeatedly by officials in food deficit counties that
the public distribution system, which has traditionally been
responsible for distributing food to the general population,
has lacked grains for several years to distribute.
International food is virtually the only food keeping these
people alive. One county official told our team members that as
the one responsible for securing food for his county, he could
not sleep any more, wondering where he would get the food. We
believe that county officials, anxious to feed as many people
as possible, sometimes stretch the available food to feed as
many people as they can.
We have clearly identified both improvements in our
monitoring capabilities within the DPRK, as well as the long
road that remains ahead. We are convinced that this aid has
been instrumental in saving the lives of North Koreans, as well
as demonstrating to the people of North Korea the compassion of
the people of the United States.
Nine U.S. food monitors are currently in Pyongyang for a 6-
month program to monitor the current tranche of U.S.-donated
food. Despite the monitoring challenges they face, each of the
current monitors has expressed a desire to return. Many of the
monitors who have gone to Pyongyang since 1997 reaffirm the
strong benefit of building relationships with their
counterparts in North Korea, helping to dispel the image of the
United States as the enemy, and building friendship and
goodwill at many levels.
Our organizations and the diverse cross-section of
Americans that we represent are united in our desire to support
the saving of human lives. We remain committed both to the
provision of aid to North Korea and to the continued effort to
increase the accountability of our monitoring abilities.
Thank you.
Chairman Gilman. Thank you, Ms. Lindborg.
[The prepared statement of Ms. Lindborg appears in the
appendix.]
Chairman Gilman. Permit me now to address some questions to
our panelists.
Critics claim, Dr. Eberstadt, that our Nation has
repeatedly given concessions in response to threats from the
North Korean government, thereby involving ourselves in a
dangerous cycle of political blackmail. What would be your
assessment of our policy, and how best can we extricate
ourselves from that cycle while addressing our national
security concerns?
Dr. Eberstadt. The North Korean government faces a very
unpromising situation in an awful lot of regards.
One of the few rays of hope from the standpoint of North
Korean strategists, in looking at the outside world, is that
the constellation of governments that it confronts most
directly--which is to say Washington, Tokyo, Seoul. Beijing,
and Moscow, has changed very dramatically in nature since the
end of the Cold War.
Generally speaking, these governments have become more
preoccupied with their own domestic concerns as opposed to
international concerns. Generally speaking, they have moved in
the direction of focusing on shorter-term, rather than longer-
term, problems. Generally speaking, these governments have
become less willing to expend what some would call ``political
capital'' for international purposes reasons.
One way of describing that constellation of governments
would be to say that North Korea now faces a ``weaker''
constellation of international actors than it did before.
However one describes it, though, this gives North Korea's
government more room to maneuver than it would have had during
the Cold War era.
Part of what the DPRK government has been consummate in
doing, not just since the end of the Cold War but during the
Cold War was as well, is extracting aid from big powers. In the
Cold War era, North Korea's aid-extracting game was to put its
hand, so to speak, in the pockets of Beijing and Moscow,
attempting to play those two off against each other, getting
aid from both and declaring allegiance to neither.
With Moscow effectively out of that game, North Korea's
approach has been to attempt to extract aid from big, and to
Pyongyang's view, hostile powers--Washington, Tokyo and, to
some degree Seoul. If one looks at the post-Cold War period,
one would certainly have to say that the North Korean
government has been very good at putting its hands in other
people's pockets. Tactically speaking, it is expert at that.
Strategically, though, North Korea is in a dead end. It is
hardly clear that it can extort enough money from the rest of
the world to revive its economy, especially given the sorts of
economic practices that its leadership seems to prefer.
Certainly it will not be able to extract enough money from the
rest of the world to be able to counterbalance South Korea's
economy, notwithstanding the problems Seoul may have had since
1997.
In general, I would advise American policymakers and
American allies to be very careful about providing money to the
DPRK regime. We would also, I think, be well advised to try to
think about what the Korean Peninsula would look like after the
DPRK, because it is the DPRK government itself that is the
fundamental source of insecurity in that peninsula.
Thank you.
Chairman Gilman. Thank you very much, Dr. Eberstadt.
With regard to U.S. aid, is the Administration sustaining a
repressive North Korean regime? Is our Nation preventing the
downfall of this odious government by continuing our
assistance?
Dr. Eberstadt. all government-to-government aid strengthens
the recipient government and permits the recipient government
to pursue its own intentions, whatever those intentions may be.
In this regard, I think some of the discussions about
monitoring of our food aid and our oil aid neglect another
important point. For resources like cash or food and, to a
lesser degree, various energy products, there is a fungibility.
This means that any new resources given to a recipient
government, for any specific purpose, strengthen that
government and permit it to pursue its existing objectives. If
those objectives are hostile to U.S. national interests, a more
powerful problem for America is created by aid transfer.
Chairman Gilman. Thank you again, Dr. Eberstadt.
Mr. Bermudez, in terms of security policy, would North
Korea ever be willing to give up its missile programs, either
its domestic development or international sales?
Mr. Bermudez. At this point in time, I don't think it will
be. It might be willing and it has proven to not test
domestically, but I don't think that it is willing to give them
up, no. It is too much a part of the psychological makeup of
the leadership.
Chairman Gilman. I know that you have commented about a
number of intelligence sources. Do you believe North Korea
continues to infiltrate South Korea and Japan with agents in
military reconnaissance teams?
Mr. Bermudez. Absolutely. In fact, the governments say they
do. They only know about it subsequently, when they capture
somebody or when there is a mistake on the part of the
infiltrating teams. There definitely is a very active
intelligence-gathering network in both South Korea and Japan.
Chairman Gilman. So as they are receiving our assistance,
they are still infiltrating the South and also Japan; is that
correct?
Mr. Bermudez. It certainly appears to me, yes.
Chairman Gilman. Mr. Bermudez, you noted that North Korea
is the world's largest proliferator of ballistic missiles and
technology. The Administration hasn't labeled North Korea in
that manner. How did you arrive at that conclusion?
Mr. Bermudez. I just look at what Third World countries
have received and from whom they have received it, and the
numbers speak for themselves.
Chairman Gilman. Ms. Lindborg, one of the PVOC's own food
aid monitors calls the food monitoring system a ``scam.'' No
one--I repeat, no one--wants to cut-off food aid to North
Korea, but how can we provide accountability?
Ms. Lindborg. I think it is actually a very frustrating
experience to be a monitor in-country, and any given individual
is certain to have reactions from an experience of being in a
very closed society. That is why we have tried to look over the
total of the experience since 1997 to discern the pattern of
improvement and of evidence that we believe the vulnerable
populations are being fed.
However, we do agree that monitoring needs to be improved.
We are pressing for a more continued presence in-country, and
we are continuing to press for better and more random visits.
Chairman Gilman. Why were the PVOC experienced Korean-
speaking monitors not allowed to reenter North Korea?
Ms. Lindborg. We have had some of our Korean-speaking
monitors reenter. I think the question of returning staffers is
less related to the Korean language ability than it is to the
North Korean's reluctance to have people return who have had
experience. They have indicated a preference to put a 6-month
cap on any individual monitor, regardless of Korean language
ability.
Chairman Gilman. Why do they assert the 6-month limitation?
Ms. Lindborg. I think they have their own reasons for
wanting to limit the amount of time that any given American
spends in-country. We are negotiating with them to change that,
and we have recently had certain monitors able to stay longer
and to return.
Chairman Gilman. Why doesn't the U.N. have any Korean-
speaking monitors on its team?
Ms. Lindborg. I can't answer that, Mr. Chairman. I think
you will have to ask the World Food Programme.
Chairman Gilman. Thank you.
Mr. Pomeroy.
Mr. Pomeroy. Thank you. My first questions are to Ms.
Lindborg.
The GAO concluded, after reviewing the food programs, that
there is insufficient monitoring; and second, that they cannot
prove or disprove significant diversion to the military of the
food aid. Let's start with the second one.
Some have suggested, it appears, that there might be a
forthcoming report which suggests that there is significant
diversion of food aid to the military. Do the programs actually
involved in delivering the food aid have an opinion on that
question?
Ms. Lindborg. We have reported in each of our written
reports to our donors that there is no evidence of diversion to
the military or otherwise. We do agree with the GAO report that
we are hopeful for improved monitoring of our programs, but we
also believe that there is a pattern of evidence that suggests
that food is reaching its targets. In part, we rely upon, as we
do in many countries, the provision of low-value grains, coarse
bulk grains like corn and unground wheat, which have less value
to the elite cadres.
We also presume, based on a great deal of anecdotal
evidence and analysis, that the North Koreans have sufficient
stocks from their own production to feed the military and
political elites. Therefore, as is the case in many of these
closed societies, it is the children and the powerless that are
most likely to not be fed when there is a shortage of food. By
FAO's reports, as well as DPRK reports, they are short between
1 and 1.5 million metric tons of grain production per year.
That means that we are feeding those who would otherwise not be
fed.
Mr. Pomeroy. Are the children, the elderly, the sick and
the vulnerable a significant political force in North Korea?
Ms. Lindborg. I certainly don't believe so.
Mr. Pomeroy. The first question is to monitoring.
The monitoring needs to be improved. It is very, very
unfortunate that North Korea would raise the kinds of questions
we are asking today, in part, simply because there is no
transparency--there is not better transparency in terms of
seeing the clean flow of food aid to its intended recipients.
On the other hand, is this a unique problem with North Korea?
Ms. Lindborg. No. Within the PVOC, the most experienced
food NGO's of the United States operate in many very difficult
environments, including countries like Sudan, Ethiopia, and
Eritrea. It is always difficult in a conflict-ridden area to
fully monitor the food. I think, as is the case in those
countries and certainly within North Korea, there is a
continuous effort to improve the quality of the monitoring, but
it is certainly not unique.
There are unique issues regarding the DPRK, however, in
that it has been closed-off for 50 years. It is very difficult
for them to understand some of the monitoring requirements that
we are pressing. For that reason we are heartened to see that
there is incremental progress because it is, to some degree,
due to the ongoing negotiations with our interlocutors to help
them better understand why we need to do what we need to do.
Mr. Pomeroy. The very notion of external monitoring is
literally foreign from their experience?
Ms. Lindborg. It is completely foreign, and they view it
very much as a security threat. I think it has been very
important, as I mentioned in my testimony, to focus as well on
the relationship-building aspects of having individuals in-
country who are face to face with our interlocutors within
North Korea, who can begin to understand why it is that we are
asking to monitor the food and that the food is simply for the
provision of feeding these vulnerable populations.
Mr. Pomeroy. Are you testifying on behalf of the----
Ms. Lindborg. I am testifying on behalf of the nine-member
Private Volunteer Organization Consortium.
Mr. Pomeroy. Thank you.
Dr. Eberstadt, if I understand the thrust of your
testimony, it is that providing any aid into North Korea helps
allay circumstances whereby we might bring this dreadful
government to an end? Is that the heart of what you are saying?
Dr. Eberstadt. Basically, sir, yes.
Mr. Pomeroy. I would just read to you from the Perry
Report, report of former Secretary Perry. He writes, ``Finally,
we have determined that while North Korea is undergoing
terrible economic hardship, these hardships are unlikely to
cause the regime to be undermined. We therefore must deal with
the DPRK regime as it is, not as we would wish it to be.''
In light of the fact that they have sufficient food stocks
for the military, political elite and that, clearly, this is a
system that has already experienced a level of starvation,
death and malnutrition that certainly would have provided the
basis for political overhaul in a different political context,
it seems to me that there is basis for what Perry has written.
Withdrawing food aid will cause many to starve and will put
pressure on the government. But that raises, if nothing else,
security issues rather than likely political transition issues.
Would you respond?
Dr. Eberstadt. Under current circumstances, Congressman, I
would recommend attempting to feed the needy populations as
best we can without feeding the government, to draw the
distinction there. However, this is a very difficult
distinction to draw.
Mr. Pomeroy. That is a slight clarification on my first
question. So you perhaps can get aid to the needy populations
without feeding the government?
Dr. Eberstadt. Congressman, my assessment is that is a
very, very difficult needle to thread, but it is one that is
worth attempting to thread.
I think there are some ways that we could attempt to
improve the distinction between feeding the needy and feeding
the DPRK state.
Centralizing aid through the DPRK public distribution
system is exactly not the way to nourish the needy in North
Korea. It seems to me that we want many, many Mercy Corps in
the DPRK --hundreds of thousands of PVO's doing their own good
works separately in their own manner, attempting to make their
own assessments of individual needs.
To me, one of the horrifying aspects of the current hunger
crisis in North Korea is how extraordinarily reluctant, how
stubbornly resistant, the North Korean state has been to
release information it possesses about the magnitude nature of
the hunger crisis to the very agencies which wish to relieve
it.
I think there are diverse ways that we could promote the
objective of nourishing the vulnerable without nourishing the
North Korean state.
Mr. Pomeroy. I thank you for that comment, and I think that
is something both sides of the political aisle on this
Committee have to pay a lot of attention to. I think we could
advance our shared goal of feeding the needy without feeding
the government much more constructively if we are working on
narrow questions of distribution, improving monitoring, really
doing the technical business of achieving just that end, rather
than making unsubstantiated allegations that there are
significant diversions to the military and passing
preconditions that cannot be met, thereby precipitating
cessation of food aid.
I think we have common concerns, but we certainly have
dramatically different notions in terms of how best to press
the concerns. I think your comments are very apt to the
differences on the Committee. Thank you very much. I thank the
panel very much.
Chairman Gilman. Mr. Pomeroy, thank you.
Dr. Eberstadt, I understand North Korea uses hard currency
to buy some very unusual items despite the famine, such as
Mercedes cars and infant diet formulas. What can we learn from
their buying habits?
Dr. Eberstadt. Congressman, I think you are referring to
some of the reported purchases of DPRK goods in the
international marketplace, which we review through so-called
mirror statistics.
One thing we can learn through those statistics is that
there seems to be a two-tiered food system in the DPRK. On the
one hand, there are big orders of 50,000, 200,000, or 500,000
tons of course grain. Then, on the other hand, there are small,
specialized purchases of one or two tons of specialty cakes or,
as you mentioned, of infant dietary food supplements--unusual
items, but small enough in volume that one would infer that a
rather limited group is being served.
Maybe that just corroborates what we already know: Namely,
that the DPRK has a small elite and a large number of people
who are at the mercy of that elite.
Chairman Gilman. Thank you.
Mr. Bermudez, which of the nations are beneficiaries of
some of the military hardware that North Korea exports?
Mr. Bermudez. There is a very long list. The most notable
are Syria, Iran, Pakistan, but the list is really Zimbabwe,
Tanzania, countries in South America. A good majority of the
countries in the world, Third World countries that is, have
received some military assistance, whether it be material or
personnel; and the percentage is very high in Africa and Asia.
Could I make a comment? Everyone keeps talking about the
armed forces or the army in North Korea, and food aid, whether
it helps North Korea's military stature. Most people don't
understand that within North Korea, the military is the state
and the state is the military.
The vast majority of North Korea's population--when you
become a teenager, you join the Red Youth Guard, which is a
paramilitary youth organization, and then you join the
military. If you are not a social elite and if you are not in
the military, you are an outcast to society. You go through
your military service. When you come out, you go into either
the Worker/Peasant Red Guard, which is a paramilitary force, or
you go into the paramilitary training unit, which is more like
an active reserve. From the age of maybe 14 all of the way up
to 55, you are part of a military organization of the state.
Chairman Gilman. Mr. Bermudez, what is the total population
of that military cadre?
Mr. Bermudez. Of all of the reserves and the military, I
don't have the figure.
Chairman Gilman. What would you estimate it to be?
Mr. Bermudez. Three, 4, 5, 6--I would roughly--and I would
have to look at my notes--8 million people.
Chairman Gilman. Out of a total population of?
Mr. Bermudez. I don't know total population right now,
especially with the losses in the past 5 to 10 years.
Chairman Gilman. My staff says 22 million. So a good fourth
of the population is in the military?
Mr. Bermudez. I would say a little more. They are
controlled by the military or have military training and serve
either as--what we would call our Reserves or our National
Guard.
Chairman Gilman. How much of the economic structure of
North Korea is dependent upon the export of military supplies?
Mr. Bermudez. Right now, a very high percentage of foreign
trade is related to military export.
Chairman Gilman. What do you estimate that to be?
Mr. Bermudez. I don't have----
Chairman Gilman. A rough estimate.
Mr. Bermudez. I have seen estimates that vary from 50 to 90
percent.
Chairman Gilman. Fifty to 90 percent of the GDP is in
military?
Mr. Bermudez. I have seen estimates in that range.
Chairman Gilman. Who would be the largest beneficiary of
those military exports?
Mr. Bermudez. Which country receives the highest percentage
of military exports?
Chairman Gilman. Yes.
Mr. Bermudez. It has to be either--I would say Iran or
Pakistan at this point. But it varies; each year it is
different.
Chairman Gilman. They are the largest trading partners?
Mr. Bermudez. For military equipment at this point, yes.
Chairman Gilman. Again, I want to thank our panelists for
being here and for providing us with very valuable insights.
The Committee will stand adjourned.
[Whereupon, at 1:15 p.m., the Committee was adjourned.]
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A P P E N D I X
October 27, 1999
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