Asia Sentinel

From charter member of the axis of evil to new partner in diplomacy, North Korea gets away with it.

The apparent deal to release some or all of the US$25 million dollars in frozen North Korean funds at Macau's sleazy little Banco Delta Asia, represents a final, humiliating reversal of George W Bush’s take-no-prisoners foreign policy.  And it illustrates again how Kim Jong Il can run rings around supposedly the mightiest nation on earth.

It’s a deal so small that it’s questionable how far it will resonate with the US’s remarkably docile conservative voters, who ought to be in front of the White House with pikes and flaming barrels of tar. That is because it illustrates how desperate the Bush administration is now to bargain for even tenuous Asian security. 

Along with Iraq and Iran, the Bush administration famously branded North Korea a part of an “axis of evil” and from the start designed a policy that envisioned engineering the collapse of dictator Kim Jong Il’s government. But in the six years since he was elected president, Bush has had to face reality. Nasty as the North Koreans may be, nobody but the US wanted the North to collapse. This is not the Middle East, and neither China nor South Korea was having any of Bush’s bid to destabilize this region by ending Kim’s reign, which was inevitably going to cause more chaos than anything else.

The Banco Delta agreement, in which the US Treasury Department concluded an 18-month “investigation” that ultimately clears the way for Macau authorities to release the frozen funds, is a farce. Banco Delta Asia was branded by the US as a major conduit to the west for profits from the sale of illegal drugs by North Korea and peddling bogus US currency printed on North Korea’s sophisticated printing presses.  The bank, for the record, maintains that it did nothing wrong. But never mind.

Although the larger six-party agreement signed to supposedly freeze North Korea’s nuclear program was partly conditioned on stopping North Korea from peddling counterfeit bills and trafficking in illegal drugs, this agreement isn’t going to do it. That is apparent from an earlier Asia Sentinel story which shows that it is still possible for greenhorn tourists to go to Dandong, China, the gateway to North Korea, and buy phoney US money on the street.

For all the bluster, the US strategy of dragooning other countries into the bogus “war on terror,” and the determination to promote “freedom and democracy” worldwide, is over, gone with the departure of former Defense Secretary Donald Rumsfeld and the apparent sidelining of Vice President Dick Cheney.  The Banco Delta agreement is an indication that the US has accepted as the price of a suspect nuclear agreement the reality that North Korea is going to keep peddling counterfeit money.

Reality. Perhaps the most salient quote ever attributed to a senior Bush administration official was delivered to Ronald Suskind, who wrote the 2004 book “The Price of Loyalty.” “Guys like me,” Suskind said he was told by a Bush aide, “were ‘in what we call the reality-based community,’ which he defined as people who ‘believe that solutions emerge from your judicious study of discernible reality.’” The aide told Suskind, “That's not the way the world really works anymore. We're an empire now, and when we act we create our own reality.”

The Bush empire is now creating an entirely new and uncomfortable reality ‑ that a toothless agreement to freeze North Korea’s nuclear weapons, and the apparent agreement that the bogus funds that exist in Banco Delta Asia are, well, maybe not so bogus, exemplifies the promotion of “freedom and democracy”  across the world.

Banco Delta Asia was designated by the US State Department in September 2005 a “primary money laundering concern” under Section 311 of the U.S. Patriot Act. What all that means now, we’re not quite sure.

From the start, after excoriating the Clinton administration’s 1994 agreement to try and work a deal with North Korea, Washington’s neoconservatives learned that they had no leverage over a country with nothing to lose but with a military force that could turn South Korea’s capital city of Seoul into a smoking ruin in hours.  There was also the US relationship with China to consider. 

So for six years, the Bush administration sat on its hands, hurling the occasional threat. So Kim, no fool, began some blackmail of his own.  He announced North Korea was opting out of the Nuclear Non-proliferation Treaty and began to build the bombs the world had always suspected he was building in the first place.

Meanwhile, on the other side of the earth the Bush administration was committing the biggest strategic blunder since Adolph Hitler ordered the invasion of Russia during World War II by blitzkrieging Iraq without provocation, accompanied by a handful of reluctant partners it designated the “coalition of the willing.” Today, the United States is in a trap in Iraq that it can neither get out of nor stay in.  So back to the man with the bomb in the mysterious orient who was giving him fits. Bush had to negotiate.

The agreement that the US ended up with may be the best of a bad bargain – North Korea agreed to shut down its Yongbyon reactor, freeze its production of plutonium and allow international inspectors to monitory and verify compliance in return for food and fuel from the US, China, North Korea and Russia. It doesn't have to dismantle its facilities. The agreement doesn’t require North Korea to denounce outright all of its nuclear activities and it gets to hold onto the smoking gun, what may be as many as four or five bombs or the wherewithal to make them in short order.

Predictably, the deal kicked off a storm of protest from the hardliners who once made up George Bush’s SWAT team of neoconservatives – including John R. Bolton, the superhawk who was unable to win nomination as UN Ambassador because almost everyone, including members of his own party, detested him.

Bush, the decider-in-chief, blinked into the headlights on February 13: “I am pleased with the agreements reached today at the Six Party Talks in Beijing. These talks represent the best opportunity to use diplomacy to address North Korea’s nuclear programs.  They reflect the common commitment of the participants to a Korean Peninsula that is free of nuclear weapons.” 

Six years of threats and toothless intimidation from the most militaristic US administration since Bush’s hero, William McKinley, invaded the Philippines, have come to this. The US cuts a deal with a crooked bank in order to make a deal with North Korea.

Comments (13)

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I\'m in the market for a safe, and a guard with a shotgun
written by Peter Kauffner , April 18, 2007

Tip me over with feather. JL steps up to plate and provides insightful commentary on a great issue of our day. And all this time I assumed he was just a greedy thief.

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FAKER
written by J L , April 17, 2007

Kauffner wrote: "I don't support the Six Party Talks myself."

Sorry Peter but I doubt that you support any talks anywhere. I have yet to read one of your analysis that isn't bent out of whack. Somewhere in you mind is the concept 'If not A, then B" and you never consider answer 'C.' Stop trying to impress and get a job.

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written by A guest , March 27, 2007

Agreed Stanley Au will be fine. Those employees of the bank that lost their jobs as a result of the US actions less so. True the bank's anti-money laundering procedures were laughable (stemming from incompetance rather than by design) but then lax anti-money laundering was something that could have been levied against the whole of Macau. 'The point of the sanctions is put pressure on North Korea and make banks think twice before doing business with the country. Whether is DBA is culpable or not is a secondary issue.' Again agreed, this is of course the real reason for the US action. But, if someone levied UNSUBSTANTIATED accusations against you for wrongdoing to deter others, would you not feel a sense of injustice? If indeed BDA are guilty, provide the evidence that no one else can find and end the arguement.

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Point of sanction was to get nuclear
written by Peter Kauffner , March 25, 2007

The evidence against the Banco Delta Asia is that they no policy to pervent money laundering and that they were accepting large commissions for cash deposits from North Korea. The point of the sanctions is put pressure on North Korea and make banks think twice before doing business with the country. Whether is DBA is culpable or not is a secondary issue. DBA owner Stanley Au still has plenty of money, he'll be fine.

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Article doesn\'t mention that BDA will be closed!
written by Peter Kauffner , March 25, 2007

This article just doesn't seem be able to get anything right. North Korea renounced the Nuclear Non-Proliferation Treaty in 2003, before the Banco Delta Asia issue came up. NK had no interest in serious negotiations on the nuclear issue until after the bank was sanctioned, so the sanctions can be given credit for bringing NK to the table. The $25 million is small beer. The most important outcome is that BDA will be liquidated and that other banks are now afraid to do business with NK, even the Bank of China. I don't support the Six Party Talks myself, but recent agreement is almost the same deal that the US offered, and NK turned down, back in 2005. So it's not Bush who has done the "humiliating reversal."

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written by a guest , March 25, 2007

Despite all the accusations levied at Banco Delta Asia the US has NEVER provided ANY evidence of money laundering. Despite investigations by the Macau government, the Hong Kong Monetary Authority, Ernst & Young and KPMG still no evidence has been found. To date the US has been unwilling (or unable) to provide proof. One might view North Korea as a customer to be distasteful in the extreme but it is not illegal. The US patriot act allows accusations and sanctions to be levied without the burden of proof. The principle of being innocent until proven guilty does not apply now to the US. Such 'justice' would be expected of N Korea but the US?

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written by yapper , March 19, 2007

Bush is hyping up all this axis of evil theory so that he can create a legacy for himself.

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Bolton is Right
written by Vale , March 18, 2007

John R. Bolton is right. Bush is wrong. Bush should have listened to Bolton instead of giving in to Kim Jong-Il's starve-his-own-countrymen regime. Bolton is acutally quite popular among many Americans, just not Democrats and a few turncoat RINO's.

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Your Crazy
written by Rick , March 17, 2007

You guys are all crazy.Bush does know what he is doing.If we had your guys way we would all be taken over by a bunch of babies like all of the people who wrote their opinion.

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right
written by john brant , March 17, 2007

I couldn't agree more. What we can do now is make sure as many people as possible know the details. It sucks.

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written by Whys , March 17, 2007

Let me see if I have this right. Kim Jong Il will be receiving food aid from the United States. The costs for which are of course paid for by the U.S. tax payer, like myself. Kim Jong Il's tyranical control over the people of North Korea is gained in no small part from his control over the food supply. It is that control which makes his Joy Brigade of teenage sex slaves a reality.

Let me ask this again, because I REALLY want to make sure I have this right. I'm helping to make the Joy Brigade possible?

Shouldn't I at least get a time share?

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written by Malaysian , March 17, 2007

Not sure I'd call it wonderful to see North Korea gaining the upper hand, no matter how detestable/criminal the Bush regime may be.

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Speculator
written by Bill , March 17, 2007

Isn't wonderful to see some cracks in the Bush Manifesto? The Bush Gang (is there any other name for the really?) including Gonzales, Cheney, "41" (as Georgie's Pap is called) and of course George himself should all me indicted and serve time for the crime they have committed against every last citizen in the county. What they stole from us may never come back, the land of the free (and brave) - HAH! The land of the afraid is more like it. Welcome to the police state!

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