North Koreans who survived the system in which the state provided everything were on their own when the state failed to provide food during the famine of the past decade.
That tragedy, combined with the government's experiment with a partial market economy have now given rise to a huge population of peddlers and retailers throughout the country.
But on top of innumerable difficulties they face — lack of materials, infrastructure, experience and market systems — these neophyte business people face two new tyrannies: mounting prices and taxes.
Lee, a North Korean businesswoman from Hoeryong, North Hamkyong Province, said she had to come to China because she could not buy rice for herself and two sons much less pay for their schooling.
Theoretically, North Korea has full employment since everyone must have a job. Lee was a garment factory worker and still is on its payroll. But she has not been paid since 1994, when the factory stopped operating due to the lack of raw materials.
To make matters worse, distribution of food also stopped. Many people went to cities to become peddlers. Under regulations, however, workers must still report to work every day even though there is no work to do. Those who became peddlers paid the factory 5,000 Won for doing their own business without reporting to work.
The central government still allocates production quotas to factories. "This is nothing but a pretext to collect tax money," Lee said. "Of the money collected from the factory workers doing business, the factory manager and the party official get their portion and send the rest to the government," she said.
"If you think the payment to the factory is the only tax we pay, you are wrong," she said. "We pay another 5,000 Won for the peddler's stand we use at the marketplace. And then there are taxes we pay to our village authorities. Whenever there is a special national project planned, they collect money from us."
The biggest irony for the "great socialist society" is that people have to pay for textbooks and teachers' salaries, Lee said. Teachers have long been unpaid by the state and cannot leave the school because they have to teach the children. So the school collects money from the students to pay the teachers.
"I made about 80,000 Won a month selling things in the market," Lee said "The authorities take half of the money as tax and dues. Sure, I can live with 40,000 Won, but not enough to send my two boys to school."
She shrugged and added, "That's why I bribed the border guard and crossed the river to come here."
