KAI RYSSDAL: To be honest, most attention in Washington wasn't on the Pentagon's money troubles today. The election's in a week, of course. But also, North Korea made the headlines this morning. Pyongyang agreed, after some arm-twisting and a nuclear bomb, to go back to the negotiating table. What's interesting is who did the twisting. We got in touch with Mike Moran at the Council of Foreign Relations.
MICHAEL MORAN: China, almost everybody will acknowledge, is the only country with any real leverage over the North. Of course, they control their oil flows, a lot of their agricultural supplies come from China. But what appears to be important here is that the North Koreans, who had previously said they would not return to the talks until the U.S. relented in some efforts to pin them down financially for their hard currency supplies, have relented on that and said "We will come to the talks."
China did something that they're not revealing that caused the North Koreans to come to the table.
RYSSDAL: Do you think the North Koreans really believe that the Bush administration is going to ease off on its financial banking institutions sanctions?
MORAN: I don't think so, but we haven't had the chance yet to scrutinize the Bush administration on that. But the crackdown on hard currency — I mean, the Administration was alleging that there were counterfeit operations and that certain banks in Macao were being used to funnel black-market funds to the North. And it appears that those sanctions remain in place.
RYSSDAL: The Chinese were reluctant to enforce some of those United Nations sanctions, which stay in effect. How much of that plays into what's going on here?
MORAN: Well, as you probably saw, there were reports today of China's monthly trade figures being released. And it showed a very significant — more than 70 percent drop in shipments of oil during September to North Korea. Now, September is the run-up to the tests. The tests took place in October. So, we don't know what the October statistics are but it's quite possible that it's similar and that the North Koreans are really facing some kind of a crunch. On the other hand, anecdotally, reporters who have watched the border say that goods and services seem to be moving fairly normally.
RYSSDAL: Once we get these talks going again in November or December as some of the press reports say today, what's really going to happen?
MORAN: That's the, you know, $64,000 question. I think analysts agree that this is a road to nowhere at the moment. You're basically inviting North Korea back as a nuclear state to a round of talks that's about preventing them from becoming a nuclear state. There is a kind of Dr. Strangelove quality to all this at this point. And I think, you know, it reflects the fact the Administration has really been back on its heels since the test and trying to figure out what American policy toward the North should be at this point.
RYSSDAL: Michael Moran's the executive editor of the website at the Council on Foreign Relations. It's cfr.org. Mike, thanks a lot for your time.
MORAN: Thank you, Kai.