The nuclear test by North Korea on Monday, following an earlier one three years ago, occurred not only on Memorial Day in the U.S. but during mourning in South Korea for former President Roh Moo-hyun, who committed suicide. The explosion has also been accompanied by missile tests. This latest move in the now long story of provocation by the communist regime is cause for very serious concern. Last month, after great public fanfare, Pyongyang test launched a missile. The Taepodong 2 missile fell into the ocean after passing over Japan. The device dubbed Unha-2 was an improved version of one tested on July 4, 2006 U.S. Independence Day. Those on the front line of diplomacy most directly affected by these tests - in particular South Korea, Japan and the United States - have reacted with public protest but military restraint. Significantly, North Koreas ally China has also condemned this latest nuclear test, along with Russia. Pyongyangs provocations stymie prospects for diplomatic progress, which recently had been promising once again. Last fall, Washington removed North Korea from the list of terrorist states in return for Pyongyangs agreement to disable a key nuclear facility. The Bush administration also gave renewed emphasis to the Six Power talks involving China, Japan, Russia and the U.S. along with the two Koreas. This dramatic reversal from earlier emphasis on unilateralism provided strong testimony for the durable value of trying to reach diplomatic understanding with the isolated communist state. The high stakes involved are self-evident. The three-year Korean War which began in 1950 took at least one million lives, and probably far more, brought direct combat between American and Chinese forces and devastated the Korean Peninsula. In the United States, public support for the Truman administration evaporated and anti-communist alarm greatly increased. Currently, economic tools beyond customary diplomacy should receive priority. Given the extraordinary poverty of North Korea, financial pressure may help bring a return to relatively moderate behavior. There is instructive recent precedent. In the first part of 2007, Washington declared Banco Delta Asia (BDA) based in Macau a renegade institution assisting illegal financial activities by Pyongyang. U.S. businesses were banned from dealing with BDA, and others followed suit. Macau government authorities froze $25 million in North Korean funds. Washington then offered to facilitate sending the funds to Pyongyang in return for restraint concerning initiatives regarding developments of nuclear weapons capabilities. A transfer of funds to North Korea eventually was carried out by BDA, reportedly with assistance from the Federal Reserve Bank of New York, the central bank of Russia and a small private Russian financial institution, the Far East Commercial Bank. This pressure resulted in a more flexible attitude by the North Korean government, at least for a time. A return to similar economic incentives as part of a comprehensive diplomatic response might be useful now. Pyongyang is rightly notorious for extensive black market activities, including weapons along with other products. Now is the time to focus on that dimension. Over the years, Pyongyang has become masterful at creating crises, sometimes approaching the brink of war, only to step back, usually in return for substantial economic assistance. For Seoul, Washington and their negotiating partners, the process has been very arduous, and at times painful. Nevertheless, war has been averted and regional stability maintained. Right now, patience is in order. Arthur I. Cyr is Clausen Distinguished Professor at Carthage College and author of After the Cold War (NYU Press and Palgrave/Macmillan; Korean edition from Oruem Publishing). He can be reached at acyr@carthage.edu