Savings Wiped Out

In one 2007 Central Committee communiqué, Kim Jong-il complained that the markets had become “a birthplace of all sorts of nonsocialist practices.” The Nov. 30 currency devaluation upended them. The state decreed that a new, more valuable won would replace the old won, but that families could trade only 100,000 won, about $30 at the black market rate, for the new one. The move effectively wiped out private stores of money.

To cushion the blow, workers say, they were promised that their salaries would be restored if they returned to their government jobs. In fact, the construction worker and others say, they got one month’s pay, in January, before salaries again disappeared.

Some with political connections skirted the worst. One woman from Hamhung, North Korea’s second-largest city, said the local bank director allowed her relatives to exchange three million won, 30 times the official limit.

The party official’s wife, hair softly curled, a knock-off designer purse by her side, boasted about her six-room house with two color televisions and a garden. In the next breath, she praised devaluation as well-deserved punishment of those who had cheated the state, even though she acknowledged that it led to chaos and noted that a top finance official was executed for mismanaging the policy.

“A lot of bad people had gotten rich doing illegal trading with China, while the good people at the state companies didn’t have enough money,” she said. “So the haves gave to the have-nots.”

The former teacher gave all she had. After her creditors stripped her of all her money, she said, she walked across the frozen Tumen River at night and into China to seek help from her relatives there. Famished and terrified, she said she banged randomly on doors until a stranger helped her contact them.

Now safe in her relatives’ home, she said, she marvels over how they enjoy delicacies like cucumbers in winter. But temporarily deserting her son and daughter, both in their mid-20s, has left her so guilt-ridden that she sometimes cannot swallow the food set in front of her. “I don’t know whether my children have managed to get some money, or whether they have starved to death,” she said, her eyes brimming with tears.