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THE SITUATION ROOM

North Korean Crisis; Interview With Former New Mexico Governor Bill Richardson; If North Korea Launches, Then What?; War Game Exposes Flaws in U.S. Plans; North Korea: A Smuggler's Paradise; Dangerous Duo: North Korea and Iran; How China Could End North Korean Crisis; Chaplain Gave POWs 'Will to Live'

Aired April 10, 2013 - 18:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


WOLF BLITZER, CNN ANCHOR: I'm Wolf Blitzer. This is a SITUATION ROOM special report, "The North Korean Crisis."

Happening now, Kim Jong-un keeps the world on edge. His missiles could launch literally at any moment. And there are new signs he won't stop with just one provocation.

Plus, CNN's rare visit to the dividing line between North and South Korea. It's the most militarized border on the planet, where the threat of war is very real. And the crime to help pay for North Korea's military might, it's like something out of the movie "The Godfather."

Well, we begin the hour with a tough new warning to North Korea today from the defense secretary of the United States, Chuck Hagel. He says Kim Jong-un is skating, his words, very close to a dangerous line. The communist leader could order a missile test launch at any moment. We're being told that the North Koreans are military masters of deception who may have something else up their sleeves as well.

Our Pentagon correspondent Barbara Starr joining us now with the very latest -- Barbara.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, military masters of deception indeed, and new indications that the North Koreans, they have some other plans up their sleeve.

(BEGIN VIDEOTAPE)

STARR (voice-over): Defense Secretary Chuck Hagel's message to Kim Jong-un and his North Korean regime: Enough is enough.

CHUCK HAGEL, U.S. DEFENSE SECRETARY: With his bellicose rhetoric, his actions have been skating very close to a dangerous line.

STARR: In the hours before an expected North Korean missile test, Hagel made clear the U.S. military is ready to respond.

HAGEL: Our country is fully prepared to deal with any contingency, any action that North Korea may take, or any provocation. STARR: The Joint Chiefs chairman offering a grim assessment of how close North Korea is to putting a nuclear warhead on a missile, a direct threat to the U.S.

GEN. MARTIN DEMPSEY, JOINT CHIEFS OF STAFF CHAIRMAN: In the absence of concrete evidence to the contrary, we have to assume the worst- case.

STARR: U.S. intelligence indicates the regime in the last few days may have moved several short-range missile launchers around the country. That's on top of the two intermediate-range mobile missiles it parked along its East Coast.

The U.S. worries multiple missile launches are the first of more provocative actions by the North. No one has forgotten the 2010 shelling of a South Korean island by North Korea.

VICTOR CHA, FORMER NATIONAL SECURITY COUNCIL MEMBER: We may see a succession of things to try to make this point that they are a strong and prosperous nation, and try to coerce the international community back into negotiations.

STARR: Kim Jong-un, Victor Cha says, may feel compelled to act.

CHA: They have pushed the rhetoric up so high now, that to do nothing, they would really look like a paper tiger.

(END VIDEOTAPE)

STARR: And Hagel says that Kim Jong-un's regime now is so unpredictable, that the U.S. simply has no choice but to prepare for whatever may come.

And, tonight, the U.S. Navy has two ships in key positions, able to shoot down a missile if it comes their way. One is east of Japan, the other further in the Pacific near Guam -- Wolf.

BLITZER: And U.S. and South Korean troops clearly now on a higher, higher state of alert. Barbara, thanks for that report.

Let's go now to CNN's rare visit to that Korean border, the demilitarized zone, or the DMZ, the historic buffer between the North and the South. It was created at the end of the Korean war some 60 years ago. And it could be a front line if -- if a new war erupted.

CNN's Kyung Lah went there today. She's now back in the South Korean capital of Seoul. And she has more on what's going on.

What else is going on, Kyung?

KYUNG LAH, CNN CORRESPONDENT: Well, what we can tell you is that when you go to the border, you certainly get a sense of how it feels between the two countries. Remember, the Korean War ended at armistice. It never really truly ended, and that's apparent at the border with a thin line between these two countries.

(BEGIN VIDEOTAPE)

LAH (voice-over): There is near absolute silence in the most militarized border on the planet, South Korean soldiers on the edge of a fight, staring down a sworn enemy, that unblinkingly stares right back, sometimes through binoculars peeking out from windows.

(on camera): This area that we're walking into is called Tamujan (ph). And the (INAUDIBLE) are actually divided in half. This side is South Korea. Over there is North Korea.

UNIDENTIFIED MALE: All cameras facing this way.

LAH (voice-over): Rules are tight on this military-guided press tour. Don't linger. Don't point. This is cold war up close.

(on camera): When we talk about tensions on the peninsula, this is about as tense as it gets. South Korean soldiers, their backs to us, facing off with North Korean soldiers, right on the other side, just feet away.

This room we're about to enter is actually divided in half, shut down, just so we can come in and capture some pictures.

UNIDENTIFIED MALE: But you can maneuver around. just please stay within arm's length of the soldiers.

LAH (voice-over): The soldiers are here so we don't get grabbed and pulled into North Korea. We're only given a few minutes in here.

(on camera): This is technically South Korea on this side. To get over to North Korea, just on the other side of these microphones.

(voice-over): The next stop is a lookout.

(on camera): You see over there in that tower? That's North Korea. You can see a North Korean flag flying right there. And that village right underneath, that is what North Korea calls the Peace Village. But South Korea refers to it as Propaganda Village.

(voice-over): Propaganda because the U.S. doesn't believe anyone actually lives here. This is all for show. One of the world's most lethal borders is up close, just a fence, barbed wire and a trench, this zone, the DMZ, uninhabitable, so untouched that endangered wildlife and plant species soar here.

And in a bizarre contradiction of the war's edge, tourists are allowed to visit this lookout, the final stop of our press tour, where we meet American brothers Joseph and Vito Lannitti.

JOSEPH LANNITTI, TOURIST: It's a little surreal knowing that just a few hundred yards that way, there are people starving and being tortured and so forth. It's just unreal.

VITO LANNITTI, AMERICAN CITIZEN: I had a lot of people ask me, family friends, if I was afraid to come over here. And I, too, knowing the history, I was like, no, I think it's going to be OK. LAH: A peek into a reclusive nation while the world guesses what move it will make next.

(END VIDEOTAPE)

LAH: As tense as it is right up at the border, people who are there frequently at the DMZ say they haven't noticed any discernible change, especially on the North. They haven't noticed that there's anything that they're doing differently. But, remember, Wolf, this is where we see the theater of war to avoid real war -- Wolf.

BLITZER: Kyung, you're back in Seoul now. That's, what, only 20 or 30 miles from the demilitarized zones, a city of many, many millions of people. I assume everyone there recognizes they're within easy artillery range of the thousands of artillery pieces the North Koreans have just north of the demilitarized zone?

LAH: Oh, yes, everybody knows that. Everyone they can get in their car and in an hour drive up to the DMZ. They know this. They grew up with this.

And so the idea of being frightened because North Korea is going to launch a missile is something you simply cannot live with daily, if you want to try to live here in Seoul. There are 11 million people here. They are doing their very best to just live life normally. And if you walk around on the streets here, and you talk to people, they are going to tell you they are numb, they are tired of North Korea, they have seen these missile launches before, they are hoping that everyone is right, that this is going to be a test. And they're just going to continue with their daily lives.

BLITZER: Kyung Lah in Seoul, South Korea, excellent report. Thanks very much.

We're joined now by a man who knows North Korea about as well as anyone, the former New Mexico Governor, the diplomatic troubleshooter Bill Richardson. He was just in North Korea in early January.

Governor, thanks very much for coming in.

U.S. intelligence now telling CNN, North Korea may be planning what they call multiple missile launches in the coming maybe hours or next few days. What is your assessment?

BILL RICHARDSON (D), FORMER NEW MEXICO GOVERNOR: Well, this is very troublesome.

There's a lot of bluster, a lot of bluffing. But when there's movements of those missiles that can be detected, then that means they're up to something. So I don't have any concrete information that they're going to take those tests. But if they do, it basically means this.

One, the North Korean military, the hard-liners have basically won out in terms of a potential power struggle there over the Foreign Ministry, the civilian types that are in that government. Number two, I think it's also reached a stage where Kim Jong-un has already used this bluster and strength internally for his domestic purposes. I mean, you can only do so much.

I think he's getting the support that he needs internally. So then the question is, why are they continuing this escalation? There's no sign that at the end of the tunnel, they're ready to negotiate with the United States, or South Korea, or Japan, or China on more food or fuel. So I think this is very perplexing now, and it's because of the new leadership, perhaps a vacuum of leadership that is happening there.

BLITZER: U.S. officials who are knowledgeable about what's going on, Governor, have suggested two dates that could be significant, April 11, that's the anniversary of Kim Jong-un's arrival in power, if you will, in Pyongyang.

Also April 15, that's the 100th birthday of Kim Il-Sung. Well, that's the birthday of Kim Il-Sung, the founder of North Korea. These dates are symbolically important. Usually they like to do something on those dates. How worried should we be about these dates?

RICHARDSON: Well, we should be worried, because they always do something dramatic on those dates, on birthdays, on anniversary deaths.

They have many of them around the deity, around the father and the son, and the founder, Kim Il-Sung. So what you want is to watch very closely what their intentions are. In the end, I think it's important for everybody to keep cool. The biggest danger here is a misjudgment, a miscalculation on the Yellow Sea, naval vessels at the border.

You just mentioned the DMZ. I think the U.S. military is playing it positively, well, basically saying, look, there's going to be a response, a cost if there is an aggressive action. And that's all we can do. I think there's an internal game, possibly a power struggle going on in North Korea with the young leader not necessarily feeling his oats, but uncertain where to go.

BLITZER: You were there -- and, in fact, I was there with you for six days in December 2010, when Kim Jong Il was still in power. You were there more recently in January of this year. You went with Eric Schmidt, the head of Google, and you spent a few days there this year when Kim Jong-un has been this power.

Between those two visits, did you sense any real change in North Korea?

RICHARDSON: Well, I thought that the new leader, Kim Jong-un, would be more diplomatically oriented, more willing to talk to the West. He had been educated in the West, that he would be willing to enter into negotiations.

But apparently what happened is when that missile launch failed, Kim Jong-un had to show his people that he was strong. He had to show his military that he was tough. So these aggressive actions followed. So I saw a positive move more towards negotiations, more towards dialogue, less rhetoric, but now the turbulence has happened since Kim Jong-un seems to have affirmed his power.

So, yes, I have been there a lot. You were there. Many have been there. But it's just very vexing what is happening. And once again, North Korea is showing something very clear. They're unpredictable. You don't know what they're thinking. They don't think like we do. And so it's very difficult to gauge what they're going to do next.

BLITZER: You're not going to go there anytime soon, are you?

RICHARDSON: No. I'm here in Santa Fe, private citizen. I'm very happy right here.

BLITZER: All right, good place to be. Governor, thanks very much for coming in.

RICHARDSON: Thank you, Wolf.

BLITZER: Up next, we have all seen the video of North Korea's military on parade. But how well are they actually trained, the North Korean troops? We're taking a closer look.

And in Japan right now, Patriot missiles, they are poised. One city has jumped the gun, mistakenly claiming that North Korea's missile has launched.

(COMMERCIAL BREAK)

BLITZER: Column upon column of highly disciplined soldiers. This is North Korea's massive fighting force and they're watching what's going on. They're trained specifically to wage war against South Korean and American military forces on the Korean Peninsula.

CNN's Tom Foreman and CNN contributor retired U.S. Army General Spider Marks take a closer look.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT: Wolf, the cornerstone of everything we have been talking about for the past couple of weeks is the North Korean army.

General, walk us through the force of this army.

BRIG. GEN. JAMES "SPIDER" MARKS (RET.), CNN MILITARY ANALYST: This is an army that has over about a million folks under arms, very large reserve component.

Certainly, mandatory service, service is anywhere from a couple of years up to 10 years.

FOREMAN: A large force, and particularly large if we think about the size of the area involved. Look at this map of the United States. That's where North Korea would fit, roughly in the same space as Mississippi. So as militaries go, this is a very massive force for a small country.

MARKS: But a very paranoid leadership.

FOREMAN: Let's talk about the breakdown of that. If you talk about the leadership, what is the number one quality required of the top officers in this military?

MARKS: Loyalty to the Communist Party and the leader right here.

FOREMAN: Kim Jong-un. That's the number one quality. What about their special forces?

(CROSSTALK)

MARKS: Very large special forces, very well-trained, the best of their military, over 100,000. They can insert by air or by sea. And we estimate that there are stay-behind forces, sleeper agents that are already located in South Korea.

FOREMAN: Beyond that, there's everybody else, and this is a massive number of people. Are they generally considered to be well-trained, good soldiers? What are they?

MARKS: They are well-trained. Compared to the rest of the population of North Korea, they have good nutrition, they have good medical care. They get a lot of training throughout the year, primarily during the winter training cycle. Then as the spring and summer roll around, they get into some of those other duties. But they're pretty good.

FOREMAN: I would guess that one of their chief hampering forces here is lack of supply, fuel, foods, sometimes, things they might rely on.

MARKS: The limiting factor, as we call it, is their ability to sustain themselves in combat.

FOREMAN: OK.

And moving on from that, if we look at a normal soldier there, tell me a little bit about this person. What would he be like?

MARKS: Now, this is where we get into those additional duties. First of all, it's relatively young. Again, they're all drafted. These additional duties that I referred to just a second ago is that these soldiers have to be able to sustain the countryside.

North Korea was founded on the principle of juche, which is self- reliance. And that means we have to be able to take care of our own medical, our own trade, our own development, our own infrastructure, our agricultural needs.

FOREMAN: And so when you fit that in with the modern policy of military first, many of the duties of government fall to this guy that we might have in different departments. It's all military.

(CROSSTALK)

MARKS: Absolutely correct. Absolutely correct.

FOREMAN: So road building, many, many things.

MARKS: All of that.

FOREMAN: Is that a big burden on an army if you're trying to maintain the army for fighting purposes?

MARKS: It certainly is. They're distracted as a matter of routine. They can train episodically during certain periods of time. Then the rest of the time, they are conducting these other duties.

FOREMAN: Which can be a huge burden upon them.

General, thank you very much -- Wolf.

(END VIDEOTAPE)

BLITZER: Tom Foreman, thanks to you and to General Spider Marks.

Let's go to Japan right now and a stunning mistake that may have created even more anxiety.

CNN's Diana Magnay is joining us from Tokyo right now.

Diana, what happened?

DIANA MAGNAY, CNN CORRESPONDENT: Hi, Wolf.

Well, the city of Yokohama accidentally sent out a tweet -- or the crisis management agency did -- saying that North Korea had already launched its missile. That tweet stayed up for 20 minutes, sent out to the agency's 42,000 followers, until they realized it was a mistake. Apparently, it was human error, but obviously very embarrassing for that particular official who sent it out, very embarrassing for the city, too, at a time at least of partially heightened tensions in this country, Wolf.

BLITZER: We have seen these Patriot air defense missile batteries now right in downtown Tokyo, if you will, Diana. How worried are people there when they see these kinds of missiles, these batteries right in the heart of their city?

MAGNAY: Well, they have seen them before. They have heard this kind of rhetoric, war talk coming out of North Korea before. It's a bit like what Kyung Lah was telling us earlier. They have been here before.

The thing is, they're a bit worried about Kim Jong-un as opposed to his father who was more of a known entity. But the message at least from the government is, this is all in hand, we're doing everything that we can to protect the citizens. That said, when we were down at the Patriot missiles in central Tokyo, the minister of defense came in to talk to their unit there, and said, you know, the situation is acute. Be prepared to act as soon as the order comes.

If you think about it, the time that officials here will have to act is so limited, given how close Tokyo is to Pyongyang. And I think that does, of course, adds to a bit of tension amongst the people here, Wolf.

BLITZER: All right, Diana, Diana Magnay in Tokyo for us. We will stay in close touch with you.

And you will be able to find out more about North Korea's missile capabilities, including an interactive map showing how far each type of the missile could potentially travel. Go to our Web site, CNN.com.

Still ahead here in our SITUATION ROOM special report, the smuggling operation that helps pay for North Korea's military, illegal weapons, drugs, and a lot more.

And Christiane Amanpour and Fareed Zakaria, they are both here, as they have been every single day. We're watching what's going on with them.

(COMMERCIAL BREAK)

BLITZER: Happening now: a frightening scenario for U.S. troops. They have practiced and practiced for a nuclear emergency with North Korea, and we have learned, guess what, it didn't go well.

Kim Jong-un's criminal network, the smuggling operation that would make Tony Soprano proud.

And new fears about an axis of evil. Is North Korea helping Iran develop nuclear weapons?

I'm Wolf Blitzer. And this is a SITUATION ROOM special report, "North Korean Crisis."

In North Korea right now, the window is wide open for a missile test literally at any moment. We're told U.S. intelligence suggests there may be multiple launches. The defense secretary of the United States, Chuck Hagel, is warning that Kim Jong-un is skating very close to a dangerous line and he promises the United States will be ready.

(BEGIN VIDEO CLIP)

HAGEL: As we have said many times, our country is fully prepared to deal with any contingency, any action that North Korea may take or any provocation that they may instigate. And we have contingencies prepared to do that.

(END VIDEO CLIP)

BLITZER: Let's bring in our chief international correspondent, Christiane Amanpour, the anchor of "AMANPOUR" that airs on CNN International. Also joining us, our own Fareed Zakaria. He's the host of CNN's "FAREED ZAKARIA GPS," which airs on CNN as well.

Christiane, you and I know Chuck Hagel. Fareed, you know Chuck Hagel. He is not a guy who speaks provocatively, shall we say, without specific warning, without specific reason. When I heard what he was saying, I sensed he's pretty concerned. CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: He is concerned, but rather than ominous, it sounded kind of reassuring. He basically said that we have what it takes to defend the homeland, to defend our allies.

And I think that yesterday the admiral in charge of the Pacific Command, Admiral Locklear, told Congress that of course they would take defensive action if they saw any missile headed in a hostile manner toward allies or towards U.S. bases in Gaum, but he would not suggest shooting down any kind of missile if it was simply headed into open Pacific water or into sparsely inhabited areas, in other words, not targeted in anger.

BLITZER: What happens, Fareed, if they do launch not just one or two, but multiple missiles, but they all let's say go into the Pacific Ocean, they fly over Japan, land in the water? Then what?

FAREED ZAKARIA, CNN WORLD AFFAIRS ANALYST: That's precisely why I think the American plan seems to be at least not precipitously to intercept them and shoot them down, because if these are sort of harmless missile tests that end up in the ocean, perhaps one way to stop the escalation is not to intercept them.

If they do appear to be close to South Korea or to Japan, I think that becomes a different matter. The key here, Wolf, is probably not really what we are doing to protect ourselves. North Korea is really not a threat to the United States. It has no capacity. The nuclear warheads it has are too heavy to sit on these missiles. The missiles it has are not particularly good. You remember a couple of years ago they tested one and it was a spectacular public failure.

The danger is, how will the South Koreans and the Japanese react? It's all right for us to look at this. We're the superpower, and we're 10,000 miles away. The South Koreans are right there, an hour away. Japan is close by. If they start looking at all this and saying, you know, "We can't keep relying on the United States for this security umbrella, for this nuclear umbrella, we have to do something," remember, these are very advanced countries. Japan in a sense is a few months away from a nuclear bomb, just because they have such a sophisticated nuclear industry. South Korea could get one very easily.

So what we're trying to do is to reassure the Japanese and the South Koreans that, "Look, we can take care of your security. Don't worry. We have the capacity to do what it takes," without getting into a kind of mano-a-mano tit for tat with North Korea.

BLITZER: Do you, Christiane, have a sense of how good U.S. intelligence on North Korea may be? I'll tell you what I've heard, that the United States has very good reconnaissance, satellite photography, communications, electronic intercepts, stuff like that, but really not necessarily a good sense of what's going on with Kim Jong-un and his inner circle; human intelligence, if you will. I wonder what you've heard?

AMANPOUR: Well, precisely that. They obviously have quite a lot of intelligence on the technical matters but not on the leadership and not on Kim Jong-un. And we've been hearing that and talking about that for the last several days since this crisis has ratcheted up.

And I've been speaking to quite a lot experts, and Mike Chinoy, who used to be a CNN correspondent, has visited there 15 times, who's met Kim Il-Sung, and he's been there very recently, you know, he feels that the sort of game has changed in North Korea. That they're no longer -- they've changed their calculation. They want to be taken seriously as a nuclear state.

And so the United States has to come up with some kind of way to deal with this. As he points out and as we know, sanctions, and the, you know, the punishments that have been inflicted on North Korea haven't actually worked when it comes to their programs. I mean, you know, they keep testing nuclear devices. And according to the experts, they do get marginally better at it, including their missiles.

The United States is not going to go to war over North Korea with all those consequences that it would have. And so what's the answer?

So after this crisis, which they believe will pass with the North Koreans able to say, look, you know, "We did this. We faced the U.S. down. We stopped the United States from, you know, invading us, and invading North Korea," then what next to avoid this constant cycle of back-and-forth provocation and who knows what?

Obviously many people have a suggestion that the Obama administration should stick to what it said. President Obama in his inauguration speech said we should have the courage to engage, not to be naive, but to be able to engage to resolve things peacefully. So some are suggesting name a high-level envoy. Somebody needs to meet Kim Jong- un, and in the North Korean system it is only the top-top leadership which makes the decisions. Kim Jong-un, like his father and his grandfather, makes the decisions.

BLITZER: Would it be smart, Fareed, to send someone like former president Bill Clinton, former secretary of state Madeleine Albright, to Pyongyang?

ZAKARIA: I think it would be a terrible idea right now. Just look at what happened. They've engaged in the spectacular display of aggression, violating international treaties, violating their obligations, threatening their neighbors.

And what do they get from it? They get a high-level American representative who comes to Pyongyang. It is exactly the wrong message to send.

Of course, we should engage with these countries, but not right now. You don't do it as a reward for behavior that everybody, the Chinese and the Russians, have argued is provocative.

The Chinese premier made a very important statement, perhaps the most important thing that's happened in the last few days, saying no single country should be able to threaten global and regional stability. A clear reference to North Korea. To my knowledge, that is the first time the president of China has ever implicitly criticized North Korea.

What we should do right now is to make clear that because of what North Korea has done, it is not going to get rewarded. Far from it, it is going to have the international community come together in a consensus around it.

At some point in the future, of course, it has always made sense for us to negotiate. We have tried, by the way. We did in the Clinton administration. We signed an agreement with them. Even the Bush administration signed two agreements with them. They broke all of them. They cheated on all of them.

This is a country that right now shut down a joint industrial park with South Korea, which was giving them $90 million, which was employing 1 in 6 of the North Koreans in that city. Why? Nobody really understands. Remember, this is a regime that has starved 2 million of its own people. It's easier to say we should negotiate with them. Practically, it hasn't achieved very much in the past.

BLITZER: Fareed, Christiane, we'll continue this tomorrow. Thanks to both of you.

Up next, our special report continues with North Korea, a paradise for smugglers. So...how'd it go?

(COMMERCIAL BREAK)

BLITZER: When it comes to North Korea, the United States says it's, quote, "fully prepared to deal with any contingency." But that's not exactly what our chief Washington correspondent, Jake Tapper, found during a recent war game exercise.

(BEGIN VIDEOTAPE)

JAKE TAPPER, CNN ANCHOR: Hey, Wolf, it could be bombs away any minute now in North Korea, with the latest intel indicating multiple missile launches may be planned. Defense Secretary Chuck Hagel says Kim Jong- un is coming very close to a dangerous line.

So are we prepared? That's not exactly what we found during a recent war game exercise.

(voice-over): Imagine this: the North Korean regime is toppled, either because the U.S. or South Korea take it out, or because of a coup. And the U.S. now has to surge troops to secure the country's nuclear stockpiles to make sure they don't fall into the wrong hands.

It's a frightening scenario played out recently at the U.S. Army War College, one that did not end all that well. The military set the scene for their war game in the fictitious land of North Brownland, essentially an alias for North Korea.

PAUL MCLEARY, DEFENSE NEWS: It was a family regime, had nuclear weapons, lost control of nuclear weapons. The population was considered to be essentially brainwashed. TAPPER: Paul McLeary, a writer for Defense News, was present as the military officials debated the plans. U.S. troops, he says, had immediate problems, surging into the North Korea-like country. B-22 Ospreys zoomed U.S. soldiers deep beyond the border, but with reinforcements so far behind, they're quickly surrounded by the enemy and need to be pulled out. American troops eventually made it over the border but with nuclear sites located in populated areas, their mission grows more difficult.

U.S. forces make humanitarian aid drops to draw people out of the cities.

MCLEARY: They made the game as difficult as possible, to really test the capabilities. They haven't really spent a lot of time or money modernizing their nuclear and chemical troops. So that's a big concern.

TAPPER: It takes the U.S. a staggering 56 days and a huge force of 90,000 troops to secure the country's nuclear weapons. Seen by many as way too long and way too many troops.

BRUCE BENNETT, NORTH KOREA EXPERT: We're not very well prepared to deal with a collapsed North Korea.

TAPPER: North Korea expert Bruce Bennett says his numbers for containing the regime's nuclear arsenal run much higher: 200,000 troops. That's larger than the forces in Iraq and Afghanistan at its peak.

BENNETT: We would have to send perhaps a third of our army to South Korea in order to deal with the weapons of mass destruction.

TAPPER: It's thought that North Korea has 100 sites linked to their nuclear and missile program. But with a black tarp shrouding of intelligence, troops would likely have to fight their way through the country to find and secure them.

BENNETT: North Korea has about 1.2 million people in the military. That's a very large military for us to deal with, but they also have, according to the South Korean defense ministry, about 200,000 special forces. And those special forces would be prepared to fight you like Taliban or the Iraqi insurgents.

TAPPER (on camera): One note, Wolf: the Army today was quick to remind us that the fictional North Brownland might not be expressly North Korea, but could be any one of the 28 countries that have weapons of mass destruction capabilities -- Wolf.

(END VIDEOTAPE)

BLITZER: Jake Tapper reporting for us, thank you.

North Korea's buildup, it's built up one of the world's largest armies. So how can they actually afford it? A poor country where so many people are starving. In part -- in part, because the country is a smuggler's paradise. Brian Todd is here taking a closer look at this part of the story. You've been checking out the money.

BRIAN TODD, CNN CORRESPONDENT: Right, Wolf. And you know, experts are telling us smuggling accounts for between 10 percent and 40 percent of North Korea's revenue. Add it all up, and you have a sophisticated criminal network that funds the nuclear weapons program of an unstable government.

(BEGIN VIDEOTAPE)

TODD (voice-over): December 2009, a cargo plane is intercepted at a refueling stop in Thailand carrying 35 tons of weapons, including rocket-propelled grenades. It came from North Korea, reported destination, Iran. A flight that violated U.N. sanctions.

April 2003, a North Korean vessel is intercepted carrying about 300 pounds of heroin to Australia. Part of a smuggling network that experts say raises hundreds of millions of dollars a year, helping to underwrite North Korea's nuclear program.

BRUCE KLINGER, THE HERITAGE FOUNDATION: Kim Jong-un really sits atop a criminal network that would make Tony Soprano proud.

TODD: A network smuggling missiles, missile parts and other weapons, counterfeit American dollars, fake Viagra and other pharmaceuticals, illegal drugs like heroin and methamphetamine. Analysts said Asian officials tell us the drugs go to U.S. and Asia over land and water. Missile parts are flown to Iran. A spider web of shipments with ever more creative methods of transport.

MARCUS NOLAND, PETERSON INSTITUTE FOR INTERNATIONAL ECONOMICS: They also act as couriers, kind of the FedEx of the international drug trade. North Korean diplomats have been busted in a number of countries using their diplomatic pouch to smuggle drugs.

TODD: Former top CIA officer Bruce Klinger, who spied on North Korea for several years, lays out another smuggling tactic.

KLINGER: We know they've used freighter ships to get the drugs into Japan. And then when that became difficult, they were even using the semi-submersible agent insertion special operations boats. They would send shipments out here, and then drop them off to be picked up by the Yakuza, the Japanese organized crime gangs for pickup to then go into Japan.

TODD: It's not just trafficking. Analysts say counterfeit dollars and methamphetamine carry the "made in North Korea" label.

NOLAND: This area is the Rust Belt of North Korea. The city of Changjin (ph), historically, has been the center of the chemicals industry. And in its depressed state, it has become a center of making illegal methamphetamines. They're made in Changjin (ph), and shipped right across the border into China.

TODD: Creating meth addicts in China and anger from Chinese officials, maybe the only true friends North Korea has left.

(END VIDEOTAPE)

TODD: I called the North Korean mission at the U.N. for a response to our report. An official there said, quote, "Smuggling has nothing to do with us. What is that?" And then he hung up on me. Iranian officials at the U.N. did not respond to the reporting that their country is a major client for North Korean missiles -- Wolf.

BLITZER: Brian will have more on that part of the story coming up. Thanks very, very much.

A nuclear nightmare scenario. The why the U.S. believes right now, North Korea and Iran may be working together on weapons.

(COMMERCIAL BREAK)

BLITZER: U.S. officials say the Korean crisis underlines what they describe as one of the United States' greatest worries. That two of the world's most dangerous nuclear programs, North Korea's and Iran's, may right now be cooperating.

Here's CNN's foreign affairs correspondent, Jill Dougherty.

(BEGIN VIDEOTAPE)

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT (voice-over): It's national nuclear day in Iran. An official holiday. Iranian TV proudly showed off pictures of everything from the Iranian mining to processing, and Iran's government announced the opening of a new processing plant.

MAHMOUD AHMADINEJAD, PRESIDENT OF IRAN (through translator): Nuclear energy is like sun, water, air and nature, it belongs to all nations. Every nation has a right to use it.

DOUGHERTY: Tuesday asked about Iran's announcement, Secretary of State John Kerry drew a parallel to the situation in North Korea.

JOHN KERRY, SECRETARY OF STATE: Clearly, any effort not unlike the DPRK, where Kim Jong-un decided to reopen his enrichment procedures by rebuilding a facility that had been part of an agreement to destroy, in the same way as that is provocative, to open up yellow cake production.

DOUGHERTY: While there's no known link between North Korean and Iranian nuclear programs, Iran already relies heavily on North Korea for its missile program.

GARY SAMORE, FORMER U.N. ARMS CONTROL COORDINATOR: The entire missile program in Iran is based on North Korean missiles and technology, which the North sold to Iran. So in that sense, there is very deep cooperation.

DOUGHERTY: The big question: Does North Korea's help extend to nuclear capability? On Capitol Hill Tuesday, the Navy's top commander in the Pacific wouldn't elaborate.

ADMIRAL SAMUEL LOCKLEAR, COMMANDER, U.S. PACIFIC COMMAND: I think that Iran would be greatly advantaged if North Korea helps them.

UNIDENTIFIED MALE: Is that help ongoing?

LOCKLEAR: I can't give you verification of that in this forum.

DOUGHERTY: Over the weekend, representatives of the U.S. and Europe's major powers wrapped up talks with Iran, making virtually no progress in getting Iran to prove whether its nuclear program is for power plants or weapons.

So while U.S. diplomats keep an eye on both countries, the Pentagon is flexing its military muscle. The Navy just announced plans to deploy a laser weapon. New, quick reaction capability to potential targets in the Persian gulf, meaning Iranian drones or gun boats.

Jill Dougherty, CNN, London.

(END VIDEOTAPE)

BLITZER: No one has more leverage in North Korea than China. CNN's David McKenzie is in Beijing with a closer look.

(BEGIN VIDEOTAPE)

DAVID MCKENZIE, CNN CORRESPONDENT (voice-over): Firing nuclear rhetoric. Armies at the ready. Missile defense systems in downtown Tokyo. Who can bring down the temperature?

THOMAS FRIEDMAN, "NEW YORK TIMES" COLUMNIST: There is one power that can end this story very quickly, end this, first of all, human tragedy of North Korea and this incredible farce of a regime. And that country is called China.

MCKENZIE: China could cut off the fuel taps and food aid to starve the regime. But through years of nuclear tests and missile launches, China's trade with North Korea has increased, not decreased.

BARBARA DEMICK, AUTHOR, "NOTHING TO ENVY": China does not want North Korea to collapse. They've made that very clear. They consider it a buffer zone.

MCKENZIE: The status quo is what China wants, says author and journalist Barbara Demick.

DEMICK: It would be taken over by South Korea, a country highly influenced by the Americans who, effectively, have the U.S. western imperialism at your doorstep.

MCKENZIE (on camera): North Korea has few friends, but China has always been one of them, putting up with their neighbor like a reckless relative.

(voice-over): China sent soldiers to fight in the Korean War, welcomed the North's founder, Kim Il-Sung, and embraced his son, Kim Jong-Il. China's leaders have long memories, says Victor Gao. VICTOR GAO, CHINA NATIONAL ASSOCIATION OF INTERNATIONAL STUDIES: On the Chinese government side, there is a lot of importance attached to maintain what he call the traditional friendship between China and DPRK.

MCKENZIE: But he says North Korea's young dictator may have gone too far this time. There hasn't been high-level talks between the two countries since November. So the threat of a nuclear North Korea may ultimately bring the U.S. and China together.

David McKenzie, CNN, Beijing.

(END VIDEOTAPE)

BLITZER: Coming up, an unsung hero of the Korean War.

(COMMERCIAL BREAK)

BLITZER: Barbara Starr has the story of an unsung hero.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Rations and water are scarce.

BARBARA STARR, CNN PENTAGON CORRESPONDENT (voice-over): In the winter of 1950, the Korean War was tough going for often overwhelmed U.S. troops. Here on the right, an extraordinary soldier who never fired a shot. And now, more than 60 years after his death, Emil Kapaun is receiving the Medal of Honor, the nation's highest award for valor in action.

For Father Emil Kapaun, a Catholic Army chaplain, the sole weapon, faith. Mike Dowe, now 85, was a young lieutenant.

(on camera): You still to this day keep his photo on the wall?

MIKE DOWE, U.S. ARMY VETERAN: Yes. That one picture is the one I like of him holding his pipe when it was shot out of his mouth.

STARR (voice-over): Captured in November 1950, Dowe met the priest as they carried the wounded on the long POW marches north.

DOWE: It was along the back of the stretcher that I was in the front of. And I said, "I'm Mike Dowe. What's your name?"

And he said, "Kapaun."

STARR: Father Kapaun's nephew, Ray, is accepting the medal in part for the men who were there.

RAY KAPAUN, FATHER KAPAUN'S NEPHEW: Even though this Medal of Honor is for Emil, it's for these guys, too. They would tell everybody and anybody that they didn't want the story to die.

STARR: Stories of a priest rescuing the wounded.

KAPAUN: Didn't matter if there were mortar shells falling around him and bullets flying by.

STARR: Mike Dowe says he survived being a POW because of Father Kapaun.

DOWE: He was able to engender a spirit of loyalty and meaningfulness to being a captive by resisting your captors and maintaining your faith with your country that enabled you to keep your will to live.

STARR: The priest regularly stole food for the starving men.

DOWE: He'd come around saying, "Hot coffee" and give hot water to all of us there. And, man, that was -- may not sound like much today, but that sure meant a lot under those circumstances.

STARR: The enemy, the North Koreans and Chinese, began to fear the now ailing Catholic priest.

KAPAUN: The Koreans came in and told him they were going to have to take him to the hospital. And the hospital, you ask all the guys, the hospital was just a dead house.

STARR: But they couldn't save him. Father Kapaun's final moments with his flock of POWs as he was carried away, difficult even now for Mike Dowe.

DOWE: He turned to me and said something to the effect, "Mike, don't worry. I'm going where -- I always wanted -- I always wanted to go, and when I get there, I'll say a prayer for you."

STARR: To this day, his remains are buried in a mass grave in North Korea. His nephew says, still, the family would like to bring him home.

Barbara Starr, CNN, Washington.

(END VIDEOTAPE)

BLITZER: That's it for me. Thanks very much for watching. The news continues next on CNN.