(Bloomberg Businessweek) -- Donald Trump will soon sit down to the most consequential negotiation of his career if, as expected, he becomes the first U.S. president to meet a North Korean leader since the devastating war on the peninsula in the 1950s. Trump, of course, wrote a book on dealmaking, only this time nuclear war and peace will hang in the balance, rather than a real estate contract. And on the evidence so far, his sparring partner Kim Jong Un has mastered The Art of the Deal, too. In fact, frequent North Korea visitor Dennis Rodman told TMZ he gave Kim a copy of the book for his birthday in 2017.
Trump offered 11 pieces of advice to budding negotiators in his 1987 book, and Kim seems to have put at least half of them to good use, starting with the first: Think Big. It was Kim who proposed a meeting with Trump earlier this year as he sought to de-escalate a spiral of threats and counterthreats over a series of nuclear and ballistic missile tests. What nobody knows, as new national security adviser John Bolton acknowledged on April 29 on CBS’s Face the Nation, is whether Kim really means to put North Korea’s complete, verifiable, and irreversible disarmament on the table.
The language on denuclearization that Kim has used isn’t new, and longtime observers of North Korea’s seemingly endless dance with the U.S. are skeptical. His true goals may instead be to split the U.S. from its allies in South Korea and Japan, loosen the economic sanctions that are strangling his country’s economy, and string out nuclear talks until the White House has a less explosive occupant. In some of those areas, Kim has already changed the conversation while giving away very little, beyond a moratorium on nuclear tests that may no longer be needed. “He’s done this masterfully, obviously wedging and decoupling to make daylight between these alliances,” says Jonathan Berkshire Miller, a senior visiting fellow at the Japan Institute of International Affairs, a Tokyo-based think tank.
The summit alone is a public-relations coup for Kim. A one-on-one meeting with the U.S. president has been a long-held North Korean goal. The TV images beamed into North Korea will show the leader of a small totalitarian rogue nuclear state on an apparently equal footing with the leader of the free world. That already would be a significant diplomatic and domestic political win for Kim. On April 27 he also became the first leader of his country to step beyond the 38th parallel that divides the peninsula, where he grasped the hand of a smiling President Moon Jae-in of South Korea—and promptly guided him over to visit the northern side of the demarcation line, making clear he’d given nothing away. If only Kim had stepped over, it would have been interpreted as a sign of deference.
After his historic meeting with President Moon, the portion of South Koreans who say they trust Kim hit 78 percent
Next up among the pages Kim already seems to have torn from Trump’s dealmaking book: Know Your Market—in this case Trump. Kim appears to have recognized that the latest White House occupant would be more willing than any before (and most likely after) to ignore both North Korea’s appalling human-rights record and warnings from the U.S. foreign policy community about the risks of holding such a meeting. Quickly organized and without scripted outcomes, the summit is a high-stakes endeavor, especially given Pyongyang’s past history of double-dealing over nuclear commitments.
“I’ve been through three North-South summits,” says Daniel Sneider, a lecturer in East Asian studies at Stanford, recalling that Kim Dae-jung, a former South Korean president, won the Nobel Peace Prize after a similarly ballyhooed meeting with North Korea in 2000. “Does it lead to denuclearization? I don’t think so.”
Kim, with his odd haircut and theatrical warnings about the nuclear button on his desk, may not have needed Trump’s advice to get himself in the news by being “a little different, or a little outrageous.” But he certainly succeeded. Then there’s Use Your Leverage, a key element in Trump’s playbook that he described in The Art of the Deal as “having something the other guy wants.” Kim has used the U.S. desire for “complete, verifiable, and irreversible” nuclear disarmament to good effect. Last year he expanded that leverage by conducting a series of nuclear and ballistic missile tests that brought North Korea close to a capacity to deliver a nuclear holocaust to Los Angeles or New York.
Kim has time on his side. As an unelected dictator in his 30s (nobody outside Pyongyang is quite sure when in the 1980s he was born), he can afford to play a longer game than the 71-year-old Trump, who faces reelection in 2020 and whose party has to defend its majorities in Congress this year. But Trump has increased his leverage, too, pressuring Kim’s sole ally, China, to tighten restrictions on trade with the Hermit Kingdom.
By offering both the carrot of a possible opening and sticks in the form of sanctions and enough unpredictability to make both China and North Korea worry that U.S. military action might follow, Trump has already outplayed both of his White House predecessors, Barack Obama and George W. Bush, according to Ian Bremmer, president and founder of the New York-based Eurasia Group risk-consulting firm. “I think Trump deserves credit for taking what had been a difficult and deteriorating status quo and actually making peace a possibility,” says Bremmer. Late on May 2, Trump tweeted to followers that they should ``stay tuned'' for the release of three U.S. citizens imprisoned in North Korea, a condition he had set for the summit.
Now that Kim has taken the ball and run with it, the U.S. is unlikely to be the biggest winner from the deal. While U.S. troop presence on the peninsula has not been put into question, the expanded joint military exercises of the past year may wind up curtailed—a key goal for both China and North Korea. South Korea, meanwhile, would enjoy the prospect of increased economic flows over the border, a lower security threat, better relations with China, and even the potential for a later reunification that could turn Korea into a nation the size of Germany. Japan, an historic rival, would have the least to celebrate at that prospect.
The chances of Kim actually giving up his nuclear deterrent would appear to be slim, given the example of Libya’s autocrat Moammar Qaddafi, who was overthrown with the help of Western air power and brutally murdered in 2011 after giving up his nuclear program. That makes an end to North Korea’s intercontinental missile development the best Trump can hope for.
It may also be difficult for Trump to keep pressure on Kim while he negotiates, as he has pledged to do. In April, just months after North Korea’s latest ballistic missile test, China’s state-backed English-language daily, the Global Times, argued in an editorial that it was time to reward Pyongyang’s change of tone by ending U.S. military drills and international sanctions.
This is where Kim has the most to gain. Sanctions have exacted a severe toll on North Korea. While no reliable official data exist for the economy—outside estimates have to be made by extrapolating from consumption of cooking oil, among other creative methods—this is undoubtedly a poor country. According to South Korea’s central bank, North Korea’s nominal gross domestic product was about $30 billion ($1,300 per capita) in 2016, compared with $1.4 trillion (more than $27,000 per capita) in the South. United Nations sanctions have played a role, driving exports down to $1.9 billion last year from as much as $3.5 billion in 2012, according to the International Monetary Fund. That’s left North Korea reliant on China for 86 percent of its exports, more than twice the share from a decade ago. The resulting squeeze on foreign currency reserves may have drawn Kim to the negotiating table, according to analysis by Bloomberg Economics.
One rule in Trump’s book that neither man seems to be following is to maximize alternatives in case things go wrong during negotiations. An acrimonious collapse of talks, between men who not long ago were deriding each other as the “Little Rocket Man” and “mentally deranged,” could leave the peninsula as close to war as if there had been no talk of a summit at all. —With Kanga Kong and Isabel Reynolds
To contact the author of this story: Marc Champion in London at mchampion7@bloomberg.net.
To contact the editor responsible for this story: Matthew Philips at mphilips3@bloomberg.net.
©2018 Bloomberg L.P.
