To test its intentions, I submitted a detailed proposal to Foreign Ministry nuclear negotiator Li Gun for a "grand bargain" in advance of a visit to Pyongyang last month. North Korea, I suggested, would surrender to the International Atomic Energy Agency the 68 pounds of plutonium it has already declared in denuclearization negotiations. In return, the United States would conclude a peace treaty formally ending the Korean War, normalize diplomatic and economic relations, put food and energy aid on a long-term basis, and support large-scale multilateral credits for rehabilitation of North Korea's economic infrastructure.

The North's rebuff was categorical and explicit. Its declared plutonium has "already been weaponized," I was told repeatedly during 10 hours of discussions. Pyongyang is ready to rule out the development of additional nuclear weapons in future negotiations, but when, and whether, it will give up its existing arsenal depends on how relations with Washington evolve.

Sixty-eight pounds of plutonium is enough to make four or five nuclear weapons, depending on the grade of plutonium, the specific weapons design and the desired explosive yield. Li Gun would not define "weaponized," despite repeated questions, but Gen. Ri Chan Bok, a spokesman of the National Defense Commission, implied that it refers to the development of missile warheads.

Faced with this new hard line, the United States should choose between two approaches, benign neglect and limiting the North's arsenal to four or five weapons.

Benign neglect would mean a suspension of ongoing efforts to denuclearize North Korea by providing economic incentives and moving toward normalized relations. But it would also mean avoiding the hostile policies initially pursued by the Bush administration with their implicit goal of "regime change."

The strongest argument for this approach is that the United States has nothing to fear from a nuclear North Korea. Pyongyang developed nuclear weapons for defensive reasons, to counter a feared U.S. preemptive strike, and U.S. nuclear capabilities in the Pacific will deter any potential nuclear threat from the North.

The purpose of this strategy would be to end the present bargaining relationship in which Pyongyang uses its nuclear program to extract U.S. concessions. It would be risky, though, because Pyongyang could well react with provocative moves to make sure that it is not neglected.

Under the second approach, the six-party denuclearization negotiations would be continued with the goal of limiting North Korean nuclear weapons to the four or five warheads so far acknowledged. This would require, first, U.S.-orchestrated arrangements to provide the 200,000 tons of heavy fuel oil that have been promised but not yet delivered to North Korea in return for its disabling the Yongbyon plutonium reactor, and, second, negotiating the terms for dismantling the reactor so that additional plutonium cannot be reprocessed.

The terms outlined to me in Pyongyang for dismantling the reactor are much tougher than those hitherto presented: completing the two light-water reactors started during the Clinton administration and conducting the broadened verification process envisaged by the United States, China, Russia, Japan, South Korea and North Korea in a statement last July. This could require inspections of U.S. bases in South Korea to verify that the United States has removed its nuclear weapons, as announced in 1991, in parallel with inspections of North Korean nonmilitary nuclear installations. The inspections in North Korea would include taking samples at suspected nuclear waste sites, a key U.S. demand, but the "weaponized" plutonium would not be open to inspection.

While in Pyongyang, I found evidence that the hard-line shift in the North's posture is directly related to Kim Jong Il's health. Informed sources told me that Kim had suffered a stroke in August. While still making "key decisions," he has turned over day-to-day authority in domestic affairs to his brother-in-law, Chang Song Taek, and effective control over national security affairs to the National Defense Commission. I was not permitted to see several key Foreign Ministry officials identified with flexible approaches to the denuclearization negotiations whom I have regularly seen in previous trips.

The bottom line is that there is a continuing policy struggle in Pyongyang between the hard-liners in the National Defense Commission and pragmatists who want normalization with the United States. Continued U.S. engagement with North Korea leading progressively to economic and political normalization would strengthen the pragmatists.

If the United States can deal with major nuclear weapons states such as China and Russia, it can tolerate a nuclear-armed North Korea that may or may not actually have the weapons arsenal it claims. Just in case Pyongyang has, in fact, learned to miniaturize nuclear warheads sufficiently to make long-range missiles, the Obama administration should couple a resumption of denuclearization negotiations with a revival of the promising missile limitation negotiations that the Clinton administration was about to conclude when it left office. "If we can have nuclear negotiations," said negotiator Li Gun, "why not missile negotiations?"

Selig S. Harrison, a former Northeast Asia bureau chief for The Post and author of "Korean Endgame," directs the Asia program at the Center for International Policy.