Key Points

• Twenty-five years after the end of the Vietnam War, the U.S. still treats Vietnam with a double standard; the July 2000 signing of a bilateral trade agreement is one step toward a balanced policy.
• Most Vietnamese have put the war behind them and harbor no ill will toward Americans.
• Vietnam’s political system and society remain authoritarian yet are gradually changing toward greater tolerance and openness.

Twenty-five years ago, on April 30, 1975, North Vietnamese troops marched into Saigon, ending what Vietnamese call the “American War” and leading to the reunification of the country. The war cost the lives of three million Vietnamese on both sides, and at least a million Laotians and Cambodians. Although most Vietnamese have put the bitter memories of the war years behind them, U.S. policy has still not fully accepted the loss of the war—as if the U.S. had grievances against Vietnam rather than the other way around. Any mention of Vietnam in the United States still evokes the war, first and foremost. Despite five years of diplomatic ties between the former enemies, the legacy of war remains hidden below the surface—sometimes quite literally, in the form of land mines, unexploded ordnance (UXO), and Agent Orange (dioxin). Over 100,000 Vietnamese have been killed or maimed by mines and UXO since 1975, and an estimated one million people suffer from toxic contamination. Additional consequences of unresolved conflicts include the economic and political isolation that still plagues the Vietnamese government, which won the war but has arguably lost the peace.

Early postwar hopes for normalization of relations between the former enemies were dashed when Washington refused to provide the reconstruction aid originally promised to Hanoi. When open conflict arose between Vietnam and Pol Pot’s Cambodia in 1978-79, the U.S. tacitly supported the Khmer Rouge and their Chinese patrons, establishing full diplomatic ties with China and agreeing to look the other way from Deng Xiaoping’s punitive invasion of northern Vietnam. In the geopolitical mindset of the Carter, Reagan, and Bush administrations, China formed a counterweight to the Soviet Union, while Vietnam was dismissed as a Soviet satellite. China received temporary normal trade relations (NTR) status, full diplomatic recognition, and, until 1989, military assistance. Vietnam got a twenty-year trade and aid embargo, which compounded the effects of a vast refugee exodus and other postwar difficulties.

The U.S. political establishment reacted to its defeat in Vietnam by adjusting its military strategy to minimize casualties to Americans. But the basic foreign policy errors that led to the Vietnam debacle lie embedded in persistent cold war thinking and in the assumption that the American way is always best. Instead of admitting that it might have supported the wrong side in the Vietnamese revolution, the U.S. has continued to fight the war by other means.

The U.S. isolation of Vietnam continued until well after the end of the cold war. President Clinton finally lifted the unilateral trade embargo in 1994 and reestablished diplomatic relations the following year. U.S. investors currently constitute 3.5% of Vietnam’s total foreign investment, ranking ninth among Vietnam’s trading partners. A bilateral trade agreement, considered by Washington to be the stepping stone to NTR, was negotiated in 1999 and signed in July 2000. But the accord will not enter into force until ratified by the U.S. Congress. With a few exceptions, U.S. assistance to Vietnam’s development has been shamefully inadequate. On the most overt war-related issues, landmines/UXO and Agent Orange, it has taken the U.S. a generation to accept the scope of the problems and to consider addressing them in a comprehensive way. In at least one aspect, normalization has had a negative impact on Vietnam: as a condition of new relations, Hanoi has been forced to begin repayment of $146 million in former South Vietnamese bilateral debt.

The widespread coverage of the April 30 anniversary in mainstream publications such as Time and People has shown Americans the new face of Vietnam. More than half of all Vietnamese were born after the war. Both they and the older generation desire peace, continued reform, and economic opportunity, ending their isolation while maintaining a distinct national identity. It behooves Washington—considering both economic interest and moral responsibility—to support the Vietnamese in these developments. Doing so, however, requires dismantling the barriers to good relations that remain as legacies of the war.

Problems with Current U.S. Policy

Key Problems

• U.S. policy continues to be dominated by cold war anticommunism and the POW/MIA myth.
• The main alternative to this policy, a trade liberalization-focused agenda, fails to satisfy legitimate Vietnamese concerns over the social consequences of economic changes.
• Trapped in their respective worldviews, U.S. and Vietnamese officials frequently fail to communicate effectively.

U.S. officials argue that the responsibility for improving relations lies largely with Vietnam. But even after signing the bilateral trade agreement, many obstacles remain on the American side. Why, for instance, has the U.S. granted permanent NTR to China while denying it to Vietnam? Why are Vietnam and neighboring Laos denied NTR status, along with Afghanistan, Cuba, North Korea, and Serbia? The answer lies in a toxic cocktail of geopolitics, business pressure, and die-hard domestic opposition.

The “paramount” American interest in Vietnam, according to Secretary of Defense William Cohen, remains recovering the bodies of U.S. soldiers listed as missing in action (MIA) during the war. Working in cooperation with Vietnamese authorities, the U.S. has spent upwards of $75 million per year since 1988 to identify fewer than 600 MIA remains, with around 1,500 Americans still unaccounted-for. Well-organized veterans’ groups have combined the MIA issue with that of American prisoners of war (POWs) to create an insidious myth justifying continued U.S. hostility toward Vietnam.

Despite the publicity it receives, the POW/MIA linkage has no basis in fact. U.S. Ambassador Douglas P. (“Pete”) Peterson, himself a former POW, confirms that all allegations have been exhaustively investigated without uncovering any evidence of POWs. There are no POWs alive in Southeast Asia; all known prisoners were released soon after the end of the war. Meanwhile, at least 400,000 Vietnamese from both sides of the conflict are still missing. Despite the inequality and even racism inherent in searching only for American remains, observers from President Clinton on down confirm that Vietnam’s cooperation with the MIA program has been excellent.

Another barrier to treating Vietnam as a normal country has been the influence of reactionary Vietnamese-American (Viet kieu) politics. Like their Miami Cuban counterparts, former South Vietnamese soldiers and officials refuse to accept current political realities, preferring to live in an imagined past. Although they do not represent the majority of Vietnamese-Americans, extremist Viet kieu groups wield a disproportionate voice in U.S. policy and at times resort to threats and even violence to silence others.

Despite widespread opposition from conservatives, veterans, and Vietnamese-Americans, Ambassador Peterson arrived in Hanoi in 1997 with an explicitly protrade agenda. Since providing direct assistance was deemed politically impossible, the U.S. is using free trade to invest its way out of history and bring prosperity to Vietnam.

Vietnamese enthusiasm for open markets, however, dropped significantly with the onset of the Asian economic crisis, during which economic isolation and restrictions on capital movements helped to shield Vietnam from the worst effects of the meltdown. Officials in Hanoi look more and more enviously at China’s economic reform policies, encouraging some investment while ultimately holding the economic reins and maintaining tight political control. In contrast, the U.S. model of free trade and capital liberalization seems distinctly less attractive.

Negotiations on a U.S.-Vietnam trade agreement dragged on far beyond Ambassador Peterson’s original schedule. The negotiators finally arrived at an “agreement in principle” in July 1999, but the Vietnamese participants apparently acted under intense U.S. pressure and without full support from their superiors. A year of renegotiations ensued before a final agreement was signed. The accord includes specific language on import quotas and tariffs, financial services, telecommunications, agriculture, and intellectual property rights—topics more comprehensive and far-reaching than any other U.S. bilateral trade agreement. Overall, tariffs on both sides will drop from an average of 40% to 3%, though reductions will be phased in over a period of years. Vietnamese negotiators won a few concessions from the U.S. in the final round of negotiations, particularly over telecommunications.

Hanoi’s hesitation on the trade agreement should not be read as mere obstructionism. Underneath the political rhetoric percolated an intense controversy within the government over the impact of globalization and the social consequences of economic reform. Debates among the government, Communist Party, and National Assembly have been drawn-out and significant, though their exact contours are hard to determine. As with the USTR and the WTO, Vietnamese economic policymaking happens behind closed doors. But some worries are clear. Communist Party leaders view unrest in the former Soviet Union and China with alarm and are determined to prevent instability at home, both for their own interests and for national survival. In light of the history of U.S. hypocrisy and broken promises, Hanoi is understandably suspicious of new offers coming from Washington.

Part of the delay in accepting the trade agreement was also rooted in political culture. Vietnam’s single-party system operates by consensus, and even one strong dissenting voice can delay agreement. This methodical, conservative style of work invariably conflicts with the American desire for fast results and measurable progress. (One Vietnamese official recently told a group of visitors, “‘Yes’ does not necessarily mean ‘yes.’”) Successive American delegations arrive in Vietnam with high hopes—after all, the Vietnamese are so capable and hospitable—only to find their prospects dashed by roadblocks and delays. Where the Vietnamese favor caution and prudence, American observers read ignorance and incompetence, often mistakenly. The Vietnamese can be extremely skillful negotiators, but they operate on their own schedule. In the case of the trade agreement, Hanoi agreed to move only after the congressional passage of the China PNTR legislation in May 2000 and signs that the U.S. was willing to renegotiate.

Toward a New Foreign Policy

Key Recommendations

• The U.S. Congress should ratify the U.S.-Vietnam trade agreement as soon as possible, and Washington should grant permanent NTR to Vietnam.
• The U.S. should accept responsibility for the consequences of the war through increased funding for demining and assistance to war victims.
• The $146 million in debt that Vietnam owes the U.S. should be converted into educational and development programs.

Breaking the current deadlock in U.S.-Vietnam relations requires substantive new initiatives on the part of the United States. Of primary importance is the bilateral trade agreement—not because signing it will bring Vietnam the economic benefits that the U.S. business lobby claims, but because it removes a critical cold war-era roadblock to full relations. Increased access for U.S. corporations will, of course, have dubious effects on Vietnam’s workers and overall social development. But the effects of the trade agreement may well be less significant than claimed by either its proponents or its detractors. Few Vietnamese companies are in a position to expand rapidly into the U.S. market, and potential U.S. investors may find their returns smaller than expected. Contrary to President Clinton’s hyperbole, the agreement will not “dramatically open” Vietnam’s economy or society, let alone “go hand-in-hand with [improvements in] human rights.”

Congressional passage of the trade agreement is likely early next year. Before Vietnam’s trade status is considered, the Senate must consider the president’s request to grant permanent NTR status to China. President Clinton may be able to accelerate congressional consideration of Vietnam’s trade status by drawing attention to Vietnam during his November visit. Also, with the election over, Clinton might feel free to propose other groundbreaking changes in the bilateral relationship.

The March 2000 visit of Secretary of Defense Cohen to Hanoi, the first by a senior military official since the war, did result in initial steps toward accepting U.S. responsibility regarding Agent Orange and land mines. Cohen agreed to consider joint research on the effects of dioxin poisoning and offered to provide deep-detection mine clearance equipment and training, overtures that seem to have been well-received by Hanoi. After further negotiations in June, the State Department agreed to include Vietnam in its Humanitarian Demining Program and offered to provide $1.7 million worth of equipment.

The U.S. Agency for International Development (USAID) provided approximately $10 million to war victims, displaced children, and orphans in Vietnam during the 1990s, the only significant war-related assistance from the U.S. since 1975. USAID’s efforts should be applauded, but the amount of assistance is still pitifully small compared to the scope of the problems or even to the size of Vietnam’s $12-million yearly payments under the 1997 bilateral debt agreement. The U.S. could demonstrate good faith in its dealings with Vietnam by doubling or trebling its aid and pursuing serious debt relief, either through outright cancellation or through some form of debt-for-education or debt-for-environment swap. Cohen’s offers and the existing USAID programs won’t solve Vietnam’s mine and UXO problem, but they do point in a positive direction. Regarding debt, however, there is no progress to report, as the U.S. Treasury remains adamant that it will only act on a formal Vietnamese request.

More noteworthy results have been achieved by nonprofit development organizations. American NGOs, comprising more than 150 of 500 foreign organizations registered in Vietnam, have been working in Vietnam since the early 1990s or, in a few cases, before that. Quaker Service Vietnam and the Vietnam Veterans of America Foundation are two organizations that have incorporated reconciliation into both their program agendas and their styles of operating in Vietnam. Private donors have also taken the lead, with a recent $150,000 Ford Foundation donation to a fund for Agent Orange victims and a $1.5-million Freeman Foundation grant to PeaceTrees for demining and tree planting in the central province of Quang Tri.

Human rights remain a sticking point in bilateral relations. In its interactions with Vietnam, as with certain other countries in the Asia-Pacific region, Washington employs a de facto two-pronged approach: the State Department plays the softer line through yearly human rights dialogues, and the House of Representatives asserts a harsher position through yearly Sense of Congress resolutions, aimed at satisfying Viet kieu constituencies. It is no accident that the May 2000 resolution, H.Con.Res. 295, was sponsored by representatives Dana Rohrabacher and Ed Royce (both R-CA), who represent Little Saigon in Orange County. A more constructive approach to human rights would focus more on specific, well-documented cases and less on sweeping denunciations.

With Congress unlikely to develop constructive new proposals, the initiative for policy change rests largely with the executive branch and with nonprofit donors. Both Americans and Vietnamese have to negotiate the minefields, both literal and metaphorical, that still separate the former enemies. There will be no easy fixes, but if the U.S. acts with realistic expectations regarding the time frame and the likely Vietnamese responses, progress toward resolving the legacy of the war can continue.