North Korea and China appear to have fallen out, but they still are talking. At the end of May, Pyongyang envoy Ri Su-yong arrived in Beijing and apparently affirmed his government’s intention to become a nuclear power, surprising no one. Kim Jong-un used the Korean Workers’ Party’s recent congress to cement his power. He highlighted North Korea’s nuclear program but, contrary to expectations, failed to offer any major new economic initiatives.

The regime already has conducted one nuclear test and appears to be planning another. North Korea is regularly testing missiles. The Democratic People’s Republic of Korea is an economic midget, but appears intent on becoming a regional military power. David Albright of the Institute for Science and International Security estimates that North Korea has accumulated fissile material for about twenty nuclear weapons. Those are enough bombs to be noticed, but not enough to be considered a major power. However, Albright suggests that Pyongyang is capable of adding another seven warheads a year. At that rate, North Korea will be in the league of India, Israel and Pakistan if the next U.S. president’s potential two terms.

It’s a prospect that should unsettle all of North Korea’s neighbors, including China.

The policy of isolation has failed. North Korea has been hurt by the latest round of sanctions backed by China, which clearly is displeased with its nominal ally. However, Beijing does not yet appear to be ready to end commercial ties with and stop shipments of energy and food to North Korea. Anything less is unlikely to have any chance of changing North Korea’s course.

Pyongyang doesn’t bother to hide its plans. Ri reportedly told his Chinese hosts that Kim’s “byungjin” policy, which emphasizes both economic development and nuclear weapons, is a “permanent strategic line” intended for North Korea’s defense. Beijing no doubt was displeased, but President Xi Jinping unexpectedly met with Ri, explaining that the PRC "attached great importance to developing a friendly relationship with North Korea."

Xi did so even though Ri’s visit coincided with another North Korean missile launch. Although the test was deemed a failure, its timing suggested that Pyongyang was confident in Beijing's mild reaction. Indeed, former State Department official Evans J.R. Revere suggested it might have been an attempt to signal that China risked even more trouble if it abandoned North Korea: “over the years, North Korea Koreans have shown themselves nothing if not skillful in manipulating the Chinese.”

The Republic of Korea already has done what it can economically against North Korea: ending most aid and closing the Kaesong industrial park. Doing so denies North Korea hard currency which could be used for further weapons enhancement and economic development, but has only been enough to generate rhetorical fulminations rather than behavioral changes in North Korea. Seoul also should invest more in its military, but so far prefers to save money by relying upon the United States.

Washington could intervene by maximizing unilateral sanctions. However, such penalties have yet to force political change in any nation. For a half century, Cuba resisted U.S. pressure, even after the U.S. imposed secondary controls. Sudan survived decades of financial isolation. North Korea almost certainly would do the same, especially if the China continued to support its frenemy.

Military action remains possible but, that would be a wild gamble and will become ever less possible as North Korea augments its nuclear arsenals. Advocates of a strike on North Korea’s nuclear facilities contend that the Kim regime would ensure regime survival by doing nothing. However, Pyongyang could initiate a limited, albeit devastating, retaliatory strike on Seoul, threatening to trigger a full-scale war. The U.S.-South Korean alliance might not survive a unilateral American decision to risk war which would be fought on and over South Korean territory. Alternatively, Kim could look at Washington’s record at taking advantage of opportunities for regime change and presume that he was America’s real target. He would probably then would seize the initiative to start a conflict seen as inevitable. His government would be defeated, but everyone would lose. So what are possible responses to North Korea?

One is to initiate both bilateral and multilateral talks, and determine if there is any kind of deal to strike. Forget convincing North Korea to give up its existing arsenal. Instead, consider limits on future production, proliferation activities and conventional threats. At the same time the U.S. and its allies should emphasize steps which would reduce any perceived threat to North Korea. Obviously, Pyongyang’s claims to fear aggression should be considered with several barrels of salt. However, even paranoids have enemies, it is said, and the U.S. routinely imposes regime change whenever the opportunity arises. Most notable was the decision to back the ouster of Muammar Qaddafi, who had made a deal with the West to abandon his nuclear and missile plans. Which left him vulnerable to allied intervention, something noted by North Korean publications.

The second approach is to prepare for a truly nuclear North Korea. First, South Korea and Japan should enhance their militaries. A growing North Korean missile and nuclear threat certainly would justify investment in missile defense. The two countries, the most obvious targets of North Korea’s ill will, also should enhance their retaliatory and preemptive capabilities. Pyongyang should be aware that resort to war would not be costless. Equally important, China should be aware that if its neighborhood exploded it could not avoid suffering perhaps significant collateral damage.

Third, the United States should begin a serious regional discussion over the possibility of the South and Tokyo developing countervailing nuclear programs. Proliferation is not desirable, but might be second best to leaving nukes only in the hands of the bad guys—Russia, China, North Korea—in Northeast Asia. It certainly is not in America’s interest to remain at the center of such a potential imbroglio, expected to risk Los Angeles and Seattle to protect Seoul and Tokyo.

Moreover, North Korea should be aware that it cannot gain a unilateral advantage with its program. China should be aware that Pyongyang’s activities threaten to spur development of nuclear weapons elsewhere that could be used against it as well. That might well spur Beijing to take more serious action against North Korea.

Finally, Washington should step back from its intrusive military role in the region. Absent American military forces in and around North Korea, Kim Jong-un would have little interest in the U.S. But Washington has made the DPRK America’s business. It would be strange if North Korea did not respond in kind. If the U.S. simply turned North Korea Korean mess over to those with the greatest interest in regional peace and stability—ROK, Japan, Russia and China—they would feel more pressure to act decisively against the Kim dynasty. It makes no sense for Washington to adopt Northeast Asia’s potential conventional wars as America’s own. It is beyond foolish to do so for potential nuclear conflicts.

North Korea is a nuclear power with a growing arsenal. Washington and its allies should confront that reality and prepare policies for a very different Northeast Asia.                                              

Doug Bandow is a Senior Fellow at the Cato Institute and a former Special Assistant to President Ronald Reagan. He is the author of Tripwire: Korea and U.S. Foreign Policy in a Changed World and co-author of The Korean Conundrum: America’s Troubled Relations with North and South Korea.

Image: Flickr/Matt Paish.