Vietnam’s muddled economy and ‘meddlesome priest’

Two news items emanating from Vietnam in the past few days show the considerable challenges this promising nation still faces. The stories at first glance would seem to have little in common. The first, from the Washington Post, relates an appalling incident in which Vietnamese security thugs attacked a U.S. diplomat attempting to visit the dissident and Catholic priest, Father Nguyen Van Ly, under house arrest. The second, from the New York Times, describes the economic turbulence besetting Vietnam as its state-run industries and unstable currency face the harsh reality checks of international finance and market forces. Undergirding both stories is a common theme: the liability of one-party rule by Vietnam’s Communist Party and its decrepit authoritarianism.

Much of the prevailing debate about the Chinese model of authoritarian capitalism (and its Russian cousin) overshadows the fact that other nations, such as Vietnam, are trying to follow a similar path. It is a mixed record. Since Vietnam’s Politburo inaugurated the "Doi Moi" economic liberalization reforms in 1986, the country has experienced substantial growth averaging around 7 percent per year. Behind these impressive numbers are the countless Vietnamese citizens whose lives and livelihoods have been considerably improved over the past two decades.

Yet as the late economist Herb Stein declared in his eponymous law: "if something cannot go on forever, it will stop." Such is the case with the hopes for enduring growth in a brittle system such as Vietnam’s, where the Communist Party still plans much of the economic activity and vainly tries to insulate its state-owned enterprises from market discipline. The Times story includes a statistic that dramatizes the inefficiency of Vietnam’s government-owned companies: they absorb 40 percent of the capital invested in the country but produce only 25 percent of its gross domestic product. Such capital misallocations are having deleterious consequences, such as inflation, credit rating downgrades, rising interest rates, and a stagnant stock market.

Father Ly’s case puts a more vivid face than economic figures on the maladies of Vietnam’s one-party rule. Along with the Buddhist monk Thich Quang Do (who has been confined to pagoda arrest — yes, pagoda arrest — for years), Father Ly is one of the country’s most prominent religious dissidents and human rights activists. The plucky cleric has been imprisoned and released (usually on account of international pressure) numerous times over the years, and his brash criticisms of the government continually provoke the Communist Party into foolish displays of its most unsavory traits. Such as this most recent appalling episode, where Vietnamese security agents attacked U.S. Embassy officer Christian Marchant simply for attempting to visit Father Ly in his home. Were the brutish police responding to the fulminations of a Politburo member invoking Henry II and bemoaning "who will rid me of this meddlesome priest?" Or were these the actions of, as the boilerplate excuse would put it, "overzealous local officials?" Either way, this assault on an American diplomat is a damning indictment of the Vietnamese Government.

Somewhat ironically, these two setbacks for both human rights and economic growth come in the midst of an otherwise growing strategic convergence between the United States and Vietnam. These improving ties, begun under the Clinton administration and furthered under the Bush and Obama administrations, are a welcome trend and should continue as part of U.S. grand strategy in Asia. But a wise geopolitics encompasses all aspects of a relationship. As the Bush administration in particular demonstrated, it is both possible and prudent to press Vietnam strongly for human rights improvements while still strengthening overall bilateral ties. Even more so, over time a Vietnam that respects the economic, political, and religious freedoms of its people will make a more reliable partner for the United States and perhaps even become another successful chapter in Asia’s freedom story.

The Times article closes with the optimistic observation that Vietnam will weather these latest economic challenges because of the resilience, dynamism, and dedication of its citizens. As anyone who has visited or lived in Vietnam in recent years will attest, the Vietnamese people are indeed a marvel: personable, hard-working, optimistic. Which is why Vietnam will never reach its full potential under an unaccountable government that tries to silence its most creative, courageous citizens, such as Father Ly.