[theapportioner]

MAD policy works when only a few parties have nuclear weapons -- the game is tightly controlled. When every Tom, Kim, and Pervez has one however it won't be as effective. To draw a parallel, it's like how in markets, game theory works most effectively when the players are fewer in number. When things get democratized everything breaks down. I do think there is a real threat that some nasty terrorist organization would acquire a "loose nuke" and use it. Since there is no obvious counterattack target, and since they want to be martyrs anyway, the MAD doctrine would fail here too.

N. Korea may be sabre-rattling, but I won't get too much into armchair analysis of that situation. From other accounts I've read though, it seems that Kim Jong Il may be genuinely nuts.