A passage from a Washington Post story run in yesterday's Seattle Times was an eye-catcher:
North Korea had pledged in February to disable its Yongbyon reactor, but it missed an April deadline because of a dispute over $25 million in North Korean-linked funds that had been frozen because of a Treasury Department investigation. North Korea demanded a wire transfer, but for months no bank would agree to accept the money because about half of it appeared linked to North Korean money-laundering and other illicit activities. [emphasis added]
Notice North Korea had trouble finding a financial institution willing to even hold its money, thanks to the US Treasury's incredibly effective action against the regime. As the Post story indicated, it's not just that the initial American action had essentially frozen the North Korean money in place, it's that no other institution was willing to be associated with such funds after US action.
It's all part of the latest tactic in bringing "soft power" to bear on America's enemies.
Although Section 311 has been exercised only 11 times -- against bank accounts involving Iran, North Korea, Syria, Burma, Latvia, and Ukraine -- the mere threat of its use has caused private banks around the world to voluntarily freeze assets and suspend accounts.
In today's world of a globalized, interconnected economy, these new tools may be one of the post powerful weapons in the United States arsenal short of military action:
For instance, last year the United States cut off Iran's state-owned Bank Saderat from access to the U.S. financial system alleging Tehran used the bank to transfer money to terrorist groups, including Hezbollah. Paulson said, "Almost immediately, financial institutions around the world began to adjust their business with all Iranian state-owned banks and with Bank Saderat, specifically."
More of that applied to Iran wouldn't be a bad thing.
Posted by Eric Earling at June 23, 2007 01:26 PM | Email ThisUse every tool, financial or whatever, to isolate and destroy the Kim government. Don't expect any North Korean cooperation with anything.
Posted by: Ken Hahn on June 23, 2007 10:23 PMWeb search "oil for food" - the Iraqi response to banking sanctions.
Conservatives have voted for sanctions as a tool to temp hurt and slow down an enemy, but we have always spoken against soft-headed liberal thinking of expecting sanctions to change the minds of madmen or overturn their governments.
The question is not whether Yongbyon will shut down, but what will happen next. We've known the endgame here for years, because it's the same as it was in 1994: we give DPRK money, fuel, and so on and he stands down. This time, we will give him more to get more (not just halting the reactor and reprocessing, but dismantling it), and because China will be in on the deal, there's a much greater likelihood of DPRK sticking to it. Likely, the U.S. will push hard for China to agree to stop shipments of food and so on, should DPRK renege.
That is: we have been isolating the regime, which is how we've gotten this far. And the threat of greater and further isolation is what will help keep them in line after agreement has been reached.
The only reason DPRK restarted Yongbyon, and the only reason they tested a nuclear weapon, is so they could extract more money and fuel from us. That's fine by me if it leads to a "permanent" solution, an actual dismantling of their weapon program.
Posted by: pudge on June 24, 2007 01:30 AMPosted by: Organization Man on June 24, 2007 10:46 AM
And doesn't SK have missles trained on us? They can't get here yet, but they are aimed at us.
And, sometimes there are slow news days and the boredom of non- local issues is broken by a national topic.
And, there is a need for breaks from the nonsense the mostly Ds and a few Rs pull off in Olympia.
Posted by: swatter on June 25, 2007 09:17 AMLet's just withdraw and let the neighbors handle the pipsqueak in the North. I think China, Russia, Japan and South Korea can take care of things in their own backyard. Time for us to leave.
Posted by: Libertarian on June 25, 2007 09:47 AMBut, Libert, what would then keep China from invading all the countries over there?
Posted by: swatter on June 25, 2007 10:00 AMHmmpf, so uninformed. Sanctions are one tool among many and like any tool, sometimes they woork and sometimes they don't!
You may recall that the Iranians took US hostages -- a crime ! -- and took the embassy -- basically an Acte of War! But le President Carter did not mount a full invasion or go to war! And the PResident ReEagan did not either! Instead they talked. And talked and talked.
Meanwhile, they put on the sanctions.
Also, meanwhile, they seized all the $$$$ and assets of Iran in the USA, England and so on. Like bank accounts. This included a few billion dollars in the Banque de Londres.
The restult is history -- an accord to return the hostages....a US IRan claims tribunal ....peacefulness....no war against Iran ...no punishment for its crimes !!!!!
They got away with it !!!!
Evan your great President Reagun swallowed the big insult and do punish Iran.
You see, sometimes a man -- like PResident Reagan -- or President Truman who let the Communists have E. Europe -- is best to let a terrorist get away with it -- because sometimes he can not win the war or does not want to pay the price to punish them. PErhaps he thinks if I start the war they will hit us back!
And yes sometimes you decide to take these risks.
But to say "always start the war, sanctions never work" is like the imbecile.
We let Iran get away with the stuff in the 70s, and now they are building nuclear bombs. So instead of a limited land war we will be looking at radioactive clouds.
We didn't push back on the communists, and we sentenced millions of people to life under a tyranny. (If you've never been to a hardcore communist country, go. Come back and tell me it's not so bad.) Trillions were spent to contain and destroy communism and it still haunts us to this day.
The lesson here is if you let the little things slide then big evils happen. Better a small war today than a bigger one later. Guiliani proved the success of this theory in New York with his Broken Windows philosophy. I think you've just convinced me he should be our next President (and I was rooting for Romney.)
Posted by: johnny on June 25, 2007 01:19 PMBut, Libert, what would then keep China from invading all the countries over there?
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Those countries will have to stand up for themselves. We've done enough.
Posted by: Libertarian on June 25, 2007 01:26 PMA little stretchy there, Libertarian. I think bases in Europe would be safer to let go than in South Korea. Agree to that location and then let's talk about the Red Threat.
Posted by: swatter on June 25, 2007 04:20 PM