Trump’s Threats Over North Korea Belie Limits on His Options

  • Administration considering tougher new trade sanctions
  • Trump has few military options that wouldn’t hurt South Korea

Nomura: Sanctions on Companies With N. Korea Ties

Hours after North Korea said it successfully tested a hydrogen bomb, President Donald Trump mused about new sanctions that would mean cutting off trade with China while his defense chief talked of military options. Neither is likely to happen.

That Trump is even considering such responses underscores how Kim Jong Un’s regime has frustrated his administration and left him with few good options. North Korea’s nuclear test, the first of Trump’s presidency, raises the likelihood the U.S. will impose significant new diplomatic sanctions targeting both North Korea and China, potentially roiling international markets.

The White House is considering a range of actions that go as far as cutting off economic ties to countries that do business in North Korea, Trump said Sunday in a tweet that was squarely aimed at China. While such a drastic step is unlikely, the U.S. could push ahead with penalties on Chinese banks and moves to cut off oil exports to North Korea, both of which have been considered in the past.

While Trump has few military avenues that would not risk widespread collateral damage for U.S. allies South Korea and Japan, slapping big sanctions against Chinese banks could set off a “gunfight at the O.K. Corral,” said Doug Paal, vice president for studies at the Carnegie Endowment for International Peace in Washington.

“If you really ratchet up the sanctions against China’s largest banks, that could have systemic consequences for the global economy and could really hurt the American economy as well as the North Korean economy,” said Paal, who was on the National Security Council staffs of Presidents Ronald Reagan and George H.W. Bush.

Meeting Convened

Trump convened a meeting with military leaders Sunday after North Korea’s underground nuclear test, which the regime said showed “unprecedentedly big power.” Trump earlier posted a series of tweets that criticized South Korea for pursuing “appeasement” with Pyongyang and threatened a trade embargo against countries that do business with it. China is North Korea’s largest trading partner and its main ally.

The president followed those tweets by telling reporters, “We’ll see” when asked whether he plans to attack North Korea.

“We have many military options,” Defense Secretary Jim Mattis said after meeting with Trump. “We are not looking to the total annihilation of a country, namely North Korea, but as I said, we have many options to do so.”

Tougher Sanctions

While the president has appeared to sour on the idea of solving the standoff through talks, experts and members of Trump’s own inner circle have signaled a military campaign against North Korea would be both catastrophic and unlikely. Officials including Treasury Secretary Steven Mnuchin and United Nations Ambassador Nikki Haley are instead pursuing new sanctions against North Korea and its benefactors.

Countries including the U.S., Japan, and South Korea have called for an emergency meeting of the United Nations Security Council on Monday, Haley said Sunday on Twitter.

Trying to curb North Korea’s nuclear ambitions through military action has a “fairly low” probability of success, said Paal. That sentiment echoes the conclusion of Trump’s former chief strategist, Steve Bannon, who told the American Prospect last month there was “no military solution” for North Korea.

“Until somebody solves the part of the equation that shows me that ten million people in Seoul don’t die in the first 30 minutes from conventional weapons, I don’t know what you’re talking about,” he told the magazine. “They got us.”

The U.S. military has about 28,000 service members stationed across South Korea.

Seoul Pushback

South Korean President Moon Jae-In has also pushed back against the prospect of a U.S. strike. In a speech last month, Moon asserted the right to veto any military action, saying that decision should be made by “ourselves and not by anyone else.” He has also vowed to prevent war at any cost.

Trump, who has recently criticized the U.S. trade deal with South Korea, voiced frustration with Moon on Twitter on Sunday.

“South Korea is finding, as I have told them, that their talk of appeasement with North Korea will not work, they only understand one thing!” Trump said.

While Trump has floated the idea of an all-out trade embargo against China, several top Republicans in Congress are pushing for a more realistic set of sanctions that would crack down on countries doing business with North Korea. China provides North Korea with most of its energy supplies and accounts for upwards of 90 percent of North Korea’s total trade volume.

Options include sanctions cutting off some Chinese banks from the U.S. financial system and an economic blockade targeting oil shipments to North Korea.

‘Unacceptable Behavior’

“I am going to draft a sanctions package to send to the president for his strong consideration that anybody that wants to do trade or business with them would be prevented from doing trade or business with us,” Mnuchin said on “Fox News Sunday.” “People need to cut off North Korea economically. This is unacceptable behavior.”

After sanctioning a small Chinese bank in June, Mnuchin said the U.S. would be willing to penalize other banks providing “illicit funding” to North Korea.

Still, such “secondary sanctions” against China could backfire, both harming the U.S. economy and potentially undermining ties, said Dursun Peksen, who teaches political science at the University of Memphis and has written extensively on economic sanctions.

“Given the size of its economy and involvement in the global economy, China is not a country that would easily give in to the threats of comprehensive economic sanctions,” Peksen said.

China was the top U.S. trading partner last year, with the two nations having a combined $579 billion in commerce, according to U.S. Census data.

Seeking new trade-based sanctions may be about the only non-defense form of punishment left as other penalties haven’t worked, said Mark Dubowitz, chief executive of the Foundation for Defense of Democracies, a think tank that tracks national security issues.

The best approach, Dubowitz said, would be to bar any companies or financial institutions that do business with North Korea from doing trade with the U.S. or using the U.S. dollar.

Read More: North Korea Defies the World With Nuclear Ambitions: QuickTake

“Chinese companies would have to make a decision: Do they want to work in a $19 trillion U.S. market, or a puny North Korean market?” he said.

North Korea’s action came despite a series of recent actions by the U.S. and the UN Security Council. Trump signed into law legislation approved in Congress in late July that contained further economic penalties, and the UN on Aug. 5 imposed what it called the “most stringent” sanctions yet. Those measures, which came in response to Pyongyang’s testing of two intercontinental ballistic missiles in July, would ban exports of coal, iron, lead and seafood.

South Korea on Monday said it detected that North Korea was continuing to prepare for a possible ICBM firing. The nation’s spy agency said there was a chance it could be launched into the Pacific Ocean, and that the isolated state was able to conduct a nuclear test at any time, the Yonhap news agency reported.

Some members of Congress are already pushing for stronger penalties after Sunday’s nuclear test.

“Working with our allies, especially South Korea and Japan, we must apply maximum financial and diplomatic pressure,” Ed Royce, Republican chairman of the House Foreign Affairs committee, said in a statement. “That includes targeting more Chinese banks that do business with North Korea -- with or without Beijing’s cooperation.”

— With assistance by Mark Niquette, Mark Drajem, and Andy Sharp

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