North Korea, Iran and Israel – The Return of Geopolitical Risk

Suddenly, and with little warning, geopolitical risk is back.

Not that it ever really left, of course. Preoccupied with a sea of financial troubles, the world had simply put it out of sight and out of mind for a while.

Now, with all the thundering force of an underground nuclear explosion, our heads are turned to the globe’s unstable flashpoints once again...

North Korea: “Look at Me”

In North Korea, the Kim Jong Il Regime has just conducted a fresh nuclear test (and fired three short-range missiles). “World leaders reacted with outrage,” according to CNN, in response to the unlawful test. The U.N. Security Council held a special emergency session to “condemn” the move.

“North Korea is directly and recklessly challenging the international community,” U.S. President Barack Obama said. The president added that “It [North Korea] will not find international acceptance unless it abandons its pursuit of weapons of mass destruction and their means of delivery.”

Therein lies the rub. In reality, North Korea doesn’t give a damn about international acceptance. What Western leaders do not say, but quietly recognize, is that all their peaceful plans and prescriptions for North Korea are viewed as poison pills by the Kim Jong Il regime.

To understand the situation, put yourself in Kim’s shoes for a moment. Were North Korea to act logically and responsibly in the eyes of the international community, gushers of aid would come flooding in. Treaties would be signed... borders would open... the country would begin to heal... and the totalitarian machine that has crushed North Korea beneath its fist for decades would be swept away in a sea of populist uprising, its leaders thrown in jail to rot for war crimes against humanity.

That is to say, thrown in jail or shot like dogs. Or perhaps hung like common thieves. North Korea’s leaders have CNN too – they saw what happened to Saddam Hussein. Does anyone imagine they really intend to let the same thing happen to them?

The Kim Jong Il regime is crazy, but not suicidal. Their tendency towards self-preservation explains why they hang on to the nuclear option with a death grip. It’s their only form of insurance against getting turfed out like Saddam. That further explains why North Korea is unlikely to actually unleash a nuclear attack on a rival power.

But North Korea is a huge headache for the rest of the world nonetheless. While the regime is unlikely to use weapons of mass destruction, it can certainly sell blueprints and materials to the highest bidder. If some aspiring terrorist leader – a sort of Bin Laden 2.0 – had the cash and contacts to make something happen, Kim Jong Il & Co. would be high on his list of folks to see.

Some hope that if we only wait long enough, North Korea will eventually collapse of its own accord. But that isn’t a very attractive option either. For one thing, a true collapse would again mean the bloody end of the regime – and there’s no telling what a nasty dictator at the end of his rope might do.

What’s more, China lives in quiet fear of a mass influx of North Korean refugees (as does South Korea). Such a flood of terrified, impoverished North Koreans could be economically and politically devastating for the border country forced to receive such an influx on short notice.

Iran: “Us Too”

Somewhat overshadowed by the North Korea news, Iran has made moves of its own that would have surely dominated headlines in any other news cycle.

Earlier this month, Iran test-fired a surface-to-surface missile with a 2,000 km (1,200 mile) range, according to Reuters – far enough to reach U.S. and Israeli military bases in the region.

In further escalation, Admiral Habibollah Sayyari announced this week that “Iran has dispatched six... warships to international waters and the Gulf of Aden region in an historically unprecedented move by the Iranian Navy.”

As you can see, North Korea isn’t the only country that wants attention...

“Iranian waters stretch along the Gulf, the Strait of Hormuz and the Sea of Oman,” Reuters goes on to add. “Iran has threatened to block the Strait of Hormuz, through which about 40 percent of the world’s oil is shipped, if it were attacked over its nuclear program."

Once again, this isn’t a case where the West can just ask Iran to play nice. It’s a game of high stakes poker in which Iran is determined at all costs to reach its goal – full-scale nuclear capability – and is willing to openly threaten 40% of the world’s oil supply in order to achieve that goal.

Israel: “We’ll Be Ready”

And the country watching Iran with the wariest eye of all? That would be Israel.

Next week Israel will be conducting a five-day drill, dubbed “Turning Point 3” by Home Front Command. The drill is meant to prepare Israel’s rapid-response capability in the event of simultaneous missile strikes and terrorist attacks, the Jerusalem Post reports.

On the third day of “Turning Point 3,” a siren will go off “throughout the entire country,” at which point all citizens of Israel will head to the nearest bomb shelter (or makeshift equivalent). Suggested reaction times vary by region – from less than 30 seconds in the Golan Heights to a full three minutes in Jerusalem

“This isn’t an imaginary situation,” says Israel Deputy Defense Minister Matan Vilnai. “This isn’t detached from reality and if there is a war, it’s very likely that this is what will happen.”

According to a poll released by Tel Aviv University on Sunday, 51% of Israeli citizens back an immediate strike on Iran’s nuclear sites. The other 49% prefer awaiting the outcome of U.S. negotiations. That mix could change quickly, obviously, depending on how future events unfold.

To further ensure readiness, in the past ten days the Israeli air force has held drills simulating “all-out war.” Again according to the Jerusalem Post: “Fighter jets, cargo planes and missile defense systems of the corps took part in the drill where defense from a simultaneous attack against Israel from the south and north was simulated.”

Make no mistake – there are some real storms brewing here. And we haven’t even touched on other flashpoints like Pakistan, Venezuela and Nigeria... tomorrow we’ll take a closer look at what this all means.

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