Even With Logical Policies, Vietnam Fails Economically

Vietnam has a new top leader, a new first among equals in the collective leadership that runs the country from Hanoi. He is Nguyen Van Linh, a longtime revolutionary from the jungles of South Vietnam who was named general secretary by the sixth congress of the Vietnamese Communist Party on Dec. 18. The congress also elected a guiding Politburo, dropping some members and adding new ones.

Changes in the Politburo and in the central committee structure just below it are considerable. However, the top leadership appears to have been more reordered than replaced, with no additions that could be termed new blood. Vietnam remains a gerontocracy.

Linh is being billed as a new broom on the model of the Soviet Union’s Mikhail S. Gorbachev or China’s Deng Xiaoping, but not enough is known about him to assert this with certainty. Possibly Linh will rise to the office despite his largely unprepossessing background. To succeed, he must solve several intractable problems.

There is the problem of the military bogdown in Cambodia, a war that Vietnam can neither win nor lose. There is the problem of Vietnam’s regional isolation, surrounded as it is by hostile neighbors and in a Cold War with China. There is the problem of internal social pathology brought on by the festering geographic regionalism, a divisive sociopolitical struggle among north, center and south and, within this, between communist North Vietnam and formerly non-communist, still unassimilated South Vietnam.

By far the most pressing problem is the economy, which is beset by a vast array of enormous difficulties.

With victory in 1975, Hanoi stood on the launching pad of what should have been a prosperous future. For various reasons, however, the economy began a precipitous decline. By 1979, by every measurable economic index, it was worse off than it had been during the war. Food production was down, causing rice riots in some of the more remote villages when supplies of rice ran out entirely. There was a shortage of all necessary consumer goods, even coffins.

In mid-1979 came the leadership showdown over the economy, essentially between the ideologues, with their doctrine of economic growth through “moral exhortation,” and the pragmatists, with their “logic of the situation” policy approach. The pragmatists won--on paper. A new master plan to solve fundamental economic problems was approved. But while the ideologues were not strong enough to block the program, for six years they were able to sabotage its implementation.

The ideologue-pragmatist struggle continued. Gradually, helped by the fading elan of the ideologues, the pragmatists began to gain the upper hand in shaping economic policy. By June, 1985, the pragmatists were able to restate their policy in a new directive, and to gain more or less universal acceptance for it.

The new approach has been in effect for about 18 months now, and most outside observers consider it to be the correct, necessary and proper policy. The irony is that, at least to date, it has not worked. Inflation, for instance, is now worse than ever, running at about 700% per year.

It is at this point that Nguyen Van Linh takes over. His first task is to determine why the new policy is not working well and to rectify it. If he succeeds, he will have solved the short-run pressing economic problems and gotten the economic machine in gear and running. That in itself would represent quite an accomplishment.

Beyond this necessary economic short-run fix lies an even more important challenge--to launch the country onto the path of true nation-building. It is an infinitely more formidable task. Major requirements or pre-conditions for economic development in Vietnam or any developing nation are an enlightened and determined leadership willing to make sacrifices in other policies in the name of economic development; a modernized economic infrastructure, which, above all, means large allocations of resources to education, particularly in science and technology; a receptive social environment, which means easing existing social tensions between Vietnam’s north and south; capital--vast amounts of investment money--which in Vietnam’s case would have to come from outside, and, finally, reasonably harmonious external relations, which means settling the Cambodian problem and detente with China.

None of these conditions exist to sufficient degree today to take Vietnam even to the point of departure for long-term economic development. These are the uncompleted tasks that lie before Vietnam and its new leaders. It is a formidable challenge.