He's Still There

Perhaps it was nothing more than wishful thinking by his many enemies, but the wildest rumor to sweep through Asian financial markets last week was that Kim Jong Il, North Korea's despotic leader, was shot in the head by his brother-in-law's son during a palace coup. Quickly dismissed as pure fantasy, the rumor of Kim's demise was merely the most extreme example of recent speculation regarding the fate of Kim's Stalinist regime.

South Korean newspapers last week reported that 10,000 Chinese troops were digging in along the North Korean border, possibly to repel a wave of refugees expected to flee the North should there be political upheaval. In other reports from the South Korean and international press, North Korean generals were said to be defecting in droves; ubiquitous propaganda portraits of Kim were mysteriously disappearing from Pyongyang's public places; and fewer North Koreans traveling abroad were wearing lapel pins depicting Kim's visage. In an interview with Fuji Television, influential Japanese lawmaker Shinzo Abe underscored a general sense of foreboding when he urged his nation to dust off contingency plans for a destabilized North Korea. "I think we should consider the possibility that regime change could occur," he said.

North Korea's isolation certainly makes it seem as if anything is possible—the country remains a black box to the outside world. But informed Western diplomats and North Korean refugees who maintain contacts with relatives back home say it does not seem as if Kim's collapse is imminent. Pyongyang's closest ally, China, appears unworried. Vice Foreign Minister Wu Da-wei last week flatly denied that his country was massing troops at the border. Ministry spokeswoman Zhang Qiyue denied any knowledge that Kim Jong Il had been toppled and admonished the world to ignore "groundless reports and news" about North Korea. Kim was on the job as recently as Nov. 22, when he visited a unit of the Korean People's Army and listened to soldiers recite poetry, presenting the young bards with gifts of automatic rifles, according to the Korean Central News Agency.

Still, pressure on Kim's regime is rising. North Korea's refusal to continue nuclear-disarmament talks with neighboring countries and the U.S. makes the North an increasingly worrisome misfit in the international arena, and there are signs that Kim is facing unprecedented challenges at home. He recently purged his brother-in-law, Jang Song Taek, for trying to set up his own power base in the military, according to South Korean intelligence testimony to Seoul lawmakers last week. Jang may have been an obstacle to Kim's plans to some day hand power over to one of his three sons, according to the testimony. Kim himself inherited power from his father, Kim Il Sung, in the communist world's first dynastic succession. "Jang got too big," says Sohn Kwang Joo, an expert on the Kim family at the government-run Research Institute for International Affairs in Seoul.

Palace intrigue isn't the Dear Leader's only headache. Launched in 2002, North Korea's half-hearted economic reforms have failed to fix its flat-lining economy. Instead, they have fueled rampant inflation and an uptick in public discontent. The country will require outside help to feed more than a quarter of its estimated 23 million people next year, the World Food Program warned last week, despite the best harvest in 10 years. Economic reforms have cut subsidies to households and factories while millions remain out of work. With inflation running at more than 100%, even many people with government salaries can't afford rice.

Indeed, North Korea's on-again-off-again economic reforms may be sparking some of the speculation regarding Kim's status. North Korea can't condemn capitalism and still allow increasingly open markets without overhauling its ideology and propaganda. China's economic reforms, begun 25 years ago, coincided with the demise of Mao Zedong's cult of personality. It makes sense that Pyongyang, too, will begin a process of change by lowering Kim's profile. Professor Ruediger Frank, a North Korea specialist at the University of Vienna, visited Pyongyang in September and for the first time noticed that portraits of North Korean leaders had been removed from his hotel room. In an essay posted on the Internet, Frank says that half the slogans in the capital now read, "The Great Leader Kim Il Sung will always be with us," which suggests a renewed emphasis on Kim's father, who died in 1994, and less emphasis on the son.

Frank suggests that trimming Kim Jong Il's personality cult could be a sign that the country is paving the way for economic reforms and possibly for a more collective form of leadership. If that's the case, then removing Kim's portraits from public places may be more a sign of strength than of weakness. Besides, the regime's ability to control its citizens appears undiminished. This summer, North Korea launched a sweeping crackdown on illegal bootleg videos of South Korean TV dramas now flooding into the country from China, according to North Korean defectors. In May, Kim took another big step back from greater openness when he shut down North Korea's new cell-phone system. That order came a month after a train mysteriously exploded in Ryongchon station, near the northern border, within hours of Kim's expected passage through the town on his way back from a trip to China. "Kim is still in control," said Peter Beck, head of the Seoul office of the International Crisis Group, a nongovernmental organization that studies security issues. "But he is under pressure to navigate the regime through some very rough waters." One thing is for sure: for every cautious assessment such as that, the next few months will see just as many wild rumors of events in the Hermit Kingdom.