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Vietnam two decades on, once more the dollar is god

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The Vietnamese Communist Party swept victoriously into Saigon nearly twenty years ago. Brought to power in a mass, revolutionary war would the Stalinist regime escape the fate of its Russian and East European backers? Twenty years on the answer is clearly no. Chris Bryant examines the Vietnamese bureaucracy’s journey from anti-imperialist victory to an attempt at capitalist restoration.

War has broken out again in Indochina. This time the protagonists are not opposing armies but two great symbols of United States commercialism, Coke and Pepsi. Their flashing neon signs will compete with those of Philips and Sony for the attention of the new breed of cell-phone toting Vietnamese Yuppies who prowl the streets of Ho Chi Minh City.

Visitors who knew the city before 1975 are quick to comment on the similarities between the Saigon of General Thieu’s crumbling, corrupt regime and today’s Ho Chi Minh City, as the Stalinists renamed it after the war. The dollar is God again. It can buy you anything: the body of one of tens of thousands of prostitutes, a slice of one of the old state industries or rights to the estimated 2.5 billion barrels of oil that lie under the Tonkin Gulf.

The defeat of US imperialism in Vietnam in 1975 was a great victory for the working class internationally. But the fact that it was led by a Stalinist bureaucracy that did not allow the working class and the peasantry even a hint of political power was a terrible defeat. Unless the bureaucracy is overthrown by a revolution in which the working class leads the peasantry to seize power, all the gains of 1975 are doomed to destruction.

When the Vietnamese Communist Party (VCP) entered Saigon in 1975, they were greeted by a celebratory general strike. But the Stalinists stuck to the letter of the “stages theory” of revolution which dogmatically insists that all anti-imperialist struggles must lead to a capitalist stage of development. They argued that while the North was in a phase of “socialist construction”, the South needed to complete its “national democratic” revolution. Thus, initially, they had no plans to end capitalist exploitation in the South. They hoped in this way to secure the $3.25 billion aid promised by France and the US.

But there is one thing that is more dear to Stalinism than any of their pseudo-Marxist phraseology and that is maintaining power. It was only when the aid failed to arrive and a tight embargo was erected around the country that they finally began to move against capitalism.

In the summer of 1975 all Southern banks were nationalised and all but small scale industry was taken into state hands. In 1976 with no aid forthcoming apart from a paltry irrigation loan from the IMF, they were forced to assimilate the South into the North and impose the Northern planning system through a unified five year plan. These measures were followed by the signing of aid deals with both China and the USSR placing unified Vietnam firmly in the Stalinist “camp”.

Faced with the tasks of reconstructing a war-torn economy, it was essential that the enormous potential of the Vietnamese working class and peasantry were drawn into a democratic planning process. But this, too, would have threatened the monopoly of power enjoyed by the Vietnamese CP.

Instead, the Stalinists relied on an incentive scheme that offered no real incentive to the masses at all. Worse, it was prone to corruption. As a result the black market was strengthened and the speculators and commercial capitalists flourished.

To counteract this threat, currency union was imposed making hoards of southern money useless against the new dong (Vietnamese currency). Currency union was also carried through with no regard for real price differences between North and South. It sparked an inflationary spiral which by the mid 1980s reached 700%.

In 1978 the VCP moved decisively against ethnic Chinese merchants whose hoarding was causing chronic shortages. China saw the expropriation of these Hoa merchants as a violation of their citizens’ national rights. Egged on by the USA, China used the crackdown on the Hoa and a territorial dispute over the Spratly and Paracel Islands as a pretext for breaking off relations with Vietnam. It was only a matter of time before war broke out.

As Trotsky had predicted 40 years earlier, Stalinism, which conceives the construction of socialist society as proceeding along national lines, will inevitably break up along those national lines. This is what happened with bloody and tragic consequences in South East Asia.

On the Southwest border, a territorial dispute with Kampuchea, now firmly allied with China, escalated into all out war. In December 1978 Vietnam invaded and set up a friendly government in Phnom Penh. China responded by invading Vietnam which, although quickly repulsed, left some key provincial capitals devastated.

Between 1979 and 1985 the bureaucracy wrestled with the legacy of imperialist occupation, continuing war, its own incompetence and the slow strangulation of the US-led embargo. While some successes were made, the price was an increased dependence on the Comecon countries where the $5 billion national debt was concentrated. Thus the VCP ended up slavishly tailing Gorbachev in the opening phases of the collapse of Stalinism in Eastern Europe. When Gorbachev embarked on his project of perestroika, the VCP launched its own programme of doi moi (renovation).

The sixth congress of the VCP in 1986 abandoned the immediate goal of socialist construction for that of developing state industry to make a profit. Party secretary Truong Chinh summed up the new position:

“. . . we laid stress on changing the ownership of the means of production, but overlooked the settlement of problems relating to management organisation and the system of distribution. We often resorted to campaigns like coercive measures, running after quantity but neglecting quality and efficiency”.

Without realising it, he was identifying one of the inherent weaknesses of bureaucratic planning. Because Stalinist planning is done by the bureaucracy and without the democratic control of the mass of consumers it invariably runs after quantity and neglects quality.

Because Truong Chinh was himself a Stalinist apparatchik, terrified of direct control by the producers, he was willing to argue that changing the ownership of the means of production was secondary to “quality and efficiency”. In the absence of workers’ democracy which could provide a real social incentive for high quality goods these things could only be brought about by market competition.

The 1986 congress was a turning point from the reluctant use of market forces–which even a healthy workers state would have to consider if it was isolated–to a wholesale attempt to unleash market forces in the Vietnamese economy. The turn was accompanied by a purge of the old hard-liners, including the vice-premier in charge of the economy, who saw their interests lying in the heavy industrial side of the Stalinist plan.

The election victory of Solidarnosc in Poland in 1989, combined with increasingly open factionalism within the bureaucracy, terrified the bureaucrats. They abandoned even the cosmetic moves towards political openness that began in 1986.

Since then, the central dilemma facing the decisive sections of the VCP leadership has been how to implement a reform package that unleashes capitalist economic forces without losing political power. This contradiction has led to increased tensions both within the party and between the party and the legislative apparatus, the National Assembly.

Although political reform has been blocked, economic reform since 1986 has gone ahead at breakneck speed. Between 1986 and 1990 internal trade barriers were lifted, the state monopoly of foreign trade was dismantled, private enterprise in all but the key state sectors was encouraged.

Those enterprises that remained firmly in the hands of the state were allowed to buy on the open market. Enterprises could now go bust and bosses were given the right to sack workers. Local and regional planning bodies are no longer subject to central planning restrictions. Instead of state procurement, a capitalist taxation system is now in place. A vicious austerity programme has thrown 3.5 million state employees out of work in order to cut back on spending.

In agriculture the changes were even more radical. In 1988 the collectives and co-operatives were freed from regional control. The following year private land ownership was effectively re-introduced. Although the state remains the legal owner of the land, many co-operatives have been allocated land on long-term leases to families. These families agree their own contracts with the state for whichever crops they choose to cultivate, unhindered by the old quota system. Crucially, the leases can now be inherited.

A new landlord class will soon develop out of the richer peasants, many of them Communist Party cadres. As early as 1989 western observers were reporting that poor peasants were starving in the countryside as a result of government policies.

The collapse of Stalinism in Eastern Europe pushed the VCP firmly towards the West as trading partners. But their continued backing for the People’s Republic of Kampuchea was a central obstacle to getting the embargo lifted. In September 1990, Vietnamese troops were withdrawn from Kampuchea. Political and economic self-interest far outweighed any supposed internationalist obligation.

From 1991, relations with China and regional capitalist states were normalised. Singapore and Vietnam granted each other “most favoured nation” status. Japan began back-door trading with Vietnam in the late 1980s and granted a $395 million commodity loan at the end of 1992 which gave the green light to the Japanese multi-nationals to begin open trading. European firms have been negotiating with Vietnam since at least 1990.

The USA still insisted on pushing the issue of the US soldiers “missing in action”—the 1,200 still unaccounted for since the war. But, as non-US multi-nationals increasingly breached the embargo, the US Senate’s resolve crumbled. Representatives of US firms, who for the last four years have been visiting Vietnam posing as tourists, finally got what they were waiting for.

While Vietnamese street traders wonder what to do with their unsold stocks of “lift the embargo now” T shirts, the Stalinists have bigger things to worry about. The free market demands that they either open up politically to bourgeois opposition forces or expand the bureaucracy so that it can represent the interests of the new competing sections of capitalism, eventually transforming itself into a comprador state-capitalist class.

Moves have been made towards this second course. Last year the CP increased its membership by one third and more of the conservative elements have been purged from both the party and the government.

While the people of Vietnam have an average income of $220 per year, the Asian Development Bank praises the country for its growth rates of 7-8% per annum. A small section of society is benefiting from the reintroduction of capitalism: the careerists, racketeers and bureaucrats.

The millions of Vietnamese workers and peasants who were the backbone of forty years of war against the imperialists, face only poverty and starvation as their rulers welcome in the old enemy.n