9/04/2012

With North Korea possibly dumping communism, is there any place left?

North Korea's agricultural reforms are only about 80 years behind those in the former USSR, where private plots were created under Stalin and later encouraged under Khrushchev, but it is still a start.  While private plots in the former USSR may have accounted for just a tiny fraction of the farm land (just 2.8 percent in 1974), they made up a huge percentage of total agricultural output.  In 1974, 41% of eggs, 32% of milk, and 64% of potatoes were produced on these private plots.  You would think that the benefits of private property would then be obvious to even many of the most loyal socialists/communists.  Hopefully, this change in North Korea will eventually have the same impact.  Meanwhile, Obama wants to take the US in the opposite direction in areas such as health care.

From the Washington Post:
Under new leader Kim Jong Eun, North Korea in recent months has shifted its rhetoric to emphasize the economy rather than the military and is introducing small-scale agricultural reforms with tantalizing elements of capitalism, according to diplomats and defector groups with informants in the North. 
The changes, which allow farmers to keep more of their crops and sell surpluses in the private market, are in the experimental stage and are easily reversible, analysts caution. But even skeptical North Korea watchers say that Kim’s emerging policies and style — and his frank acknowledgment of the country’s economic problems — hint at an economic opening similar to China’s in the late 1970s. . . .
Yet, some caution is in order and the North Korean reforms are different from those in the former USSR.  In particular, farmers can only keep for private use output above their quotas.  One problem with this is that farmers might feel that if they exceed their quotas, the government could come back and simply raise their quotas in the future.  The farms are still collectively run, though the free-riding problem might be somewhat reduced.
Those measures, according to the reports, reduce the size of cooperative farm units from between 10 and 25 farmers to between four and six. The decrease is critical because it allows one or two households, not entire communities, to plan and tend to their own farms. . . .  

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