Why the continuity is as important as the change at the 9th Congress of April 2001

Why the continuity is as important as the change at the 9th Congress of April 2001

By Michael Karadjis

(Originally published in the June 2001 issue of Vietnam Economic Times, Hanoi)

Asked to comment on the Communist Party’s 9th Congress, my initial reaction is to wonder what authority I have to judge the actions of people who successfully led decades of resistance to the most powerful imperial states in history.

After all, as a 13-year old schoolboy marching against my country’s involvement on the US side in the most devastating attack on any country in history, I was already late – Uncle Ho had passed away three years earlier, General Giap had led one of history’s most decisive battles 18 years earlier – and my future wife was being evacuated from Hanoi with thousands of other children as US bombers wreaked unprecedented vengeance on the civilian population right up to the very second before signing the Paris 1973 Accords.

My first reaction, therefore, to being invited to the Congress as a representative of the Australian Democratic Socialist Party, is that it is quite an honour.

However, a quarter of a century later, what does this Congress have to say about the progress towards the non-exploitative society called socialism that both Vietnam’s fighters and, in our own modest way, many anti-war protesters in the West were together marching for?

At least that is my question. Yet for many of my fellow expats, it would seem the very opposite question is foremost in their minds. Some things are slowly changing, but the Congress still spouted the “same old dogma”. The Party talks about reform of State Owned Enterprises (SOE’s), but when are they going to end this “monopoly” completely and sell them off to the highest bidder? Despite the continually increasing incentives to foreign investment, when will all restrictions and guidelines be swept away to open the floodgates? Indeed when are they just going to forget about “tired old ideas” like socialism altogether?

In fact, there were many changes in policy detail regarding economic policy and administrative reform – while I won’t go into detail here, it is enough to say that they were sufficient to move the IMF to coming through with a $368 million loan held up for five years, and the World Bank to offer a new $400 million loan for economic development and poverty reduction. Vietnam needs loans and investment, so it has to please such organisations.

But the Post-Modern catastrophe called Russia and the collapse of the Asian “miracle” tell us that Vietnam’s caution in going little further than necessary is very wise.

Regarding overall socio-economic direction, much is fundamentally similar to that pointed to at the last Congress in 1996. While continuing to emphasise the need for the growth of both the private capitalist sector and of foreign investment, right through the political resolution there is a strong reaffirmation that the State sector aims to play the dominant role in the economy and that socialism remains the goal.

Which allows me, and millions of other communists and socialists and people concerned about equality and social justice around the world, to breathe a sigh of relief.

There is no question that Vietnam needs considerable change in a host of theatres. Change in any society is good and necessary – an unchanging society suggests a lack of dynamism. Anyone who’s ever read Marx or Lenin would understand that calls for constant renewal of policy, of tactics, of personnel, and going to the masses to root out bureaucratic inertia, were fundamental to their entire political philosophy. The gigantic bureaucratic machines built by Stalin and Mao and their heirs were not, as is often thought, a “dogmatic” version of Marxism-Leninism, but rather, its antithesis.

The crucial question is however, what kind of changes? Aside from the changes in socio-economic policy detail, there were a number of important changes.

Firstly, there were important changes in personnel. The new leader is 10 years younger, the official position of older Advisers was scrapped, a new Central Committee was elected with an average age of 54 years, 92 per cent of whom have university degrees.

Yet this change also reflects continuity of tradition. Renewal at the leadership level has been reasonably constant in Vietnam since 1986, when the bulk of the older leadership stepped down. After every five-year Congress there have been personnel changes to the Politburo, the Central Committee and the Party leadership. In the last 15 years there have been an average of three Party leaders, three Prime Ministers and three Presidents. How come a US President can be around for 8 years, but if Vietnamese leader rules for five years that’s too long – yet on the other hand, if former leader Le Kha Phieu ran the show for only one year less than that, that is suspiciously short?

Secondly, a renewed emphasis was put on addressing ethnic minority issues. Frequent interventions from Congress delegates addressed the issue. Cu Hoa Van, head of the Party’s Nationalities Commission, stressed that economic development in minority regions must be higher than the national average; that the cultural identity, including language and writing systems, literature and art, of each minority must be preserved; that education and training of minorities for cadre development must be stepped up; and that democracy and transparency in socio-economic development programs must be enhanced, with minorities and local people participating more decisively in framing and developing such projects.

Notably, these points build on already established policies. Regarding the last theme, the 1998 Grassroots Democracy Degree allows international funding bodies to deal directly with people at the commune level, bypassing various levels of bureaucracy and hence undercutting opportunities for corruption – while getting more direct popular input.

The high rate of poverty in highland and remote areas where minorities live has been reduced by 4-5 per cent annually over the last two years – and a major corruption scandal busted. Regarding languages, last year nine ethnic minority language radio stations were established – and lets not forget that one of the earliest acts of the revolution in the 1950’s was to establish writing systems for a host of minority languages.

Having someone from the Tay minority run the Party is also highly symbolically important – a Palestinian-Australian friend of mine e-mailed me to congratulate the Party on this. After all, he simply can’t imagine when Australian society will ever be mature enough to accept an Aborigine running the country, and of course the rights of the Palestinian people are daily violated on a massive scale.

Thirdly, there was the process of making changes to the political resolution after the draft was published. This consisted of nightly televising of input from people around the country, leading to a huge number of amendments. It is interesting to quote the Far East Economic Review on this, where it conceded “Those may sound like small steps toward "grassroots democracy," but for Vietnam, they are meaningful.”

Just a moment. “For Vietnam”? The irony may have escaped you. Perhaps the FEER should explain where else such public input is encouraged into major policy documents. I can’t think of any off hand. Nothing has ever approached it in Australia. It is unimaginable in any other state in south east Asia.

Fourthly, there were continual calls at the Congress for more “grass-roots democracy”, defined by the FEER article as “bottom-up participation in decision-making and budget supervision, and linking party promotions to public feedback”. These were commended by the article, but also relegated to the status of a “safety valve” for the Party. Perhaps. But still, grass roots participation in supervising a budget has never been a noted feature in capitalist countries, where economic experts – inevitably economic rationalists – zealously guard the elite knowledge and right to rule of their caste. Popular pressure for better health, education or welfare funding can be dismissed as the ravings of people who do not understand supposedly eternal, immutable economic “laws.”

Again, it is notable that this call on grass roots party members throughout the country to “supervise, identify and denounce” state and party leaders who were corrupt or authoritarian did not first appear at the Congress, but has been forcefully repeated since 1998 by none other than former leader Le Kha Phieu – something a little different to the usual western media picture of a “conservative.”

According to a Reuters dispatch during the Congress, “a news conference on Friday afternoon highlighted the failure of an anti-corruption drive launched two years ago onwhich Phieu had staked his reputation. Senior central committee official Pham Van Tho said the party had expelled nearly 3,000 members and disciplined more than 16,000 others, including senior officials, in the period to clean up graft and mismanagement.”

Note that for Reuters, this is obviously a failure; one wonders how many other ruling parties in south east Asia or elsewhere have expelled thousands of members for corruption and continue to call on the grass roots to take such action. And don’t give me the one about corruption being more serious here than in neighbouring countries.

If you are corrupt in Thailand, and you have been involved in military coups, you become the prime minister. If you are unimaginably corrupt in Indonesia or the Philippines, you stay in power for decades backed by the military and have to be overthrown by the people. In Vietnam, if your corruption reached unsurpassed levels, you were probably in the former Saigon regime and had to employ the entire US arsenal to remain in power. All countries, mind you, based on the unfettered “free market.”

Which leads to the other major theme of the Congress – a stepped-up fight against corruption, which Nong Duc Manh declared would be a life and death issue for the future of both the Communist Party and of any progress towards socialism in Vietnam.

He’s right. Not because corruption is worse here. It isn’t. But when corruption exists in capitalist countries, which already promote the cult of flamboyant wealth for the few, massive inequality and a “blame the poor” mentality, even huge corruption can only ever be a blemish. In a country aiming for socialism, it attacks the very essence.

Moreover, if the evil isn’t rooted out, it will make much of what was pushed at the Congress, from poverty alleviation and ethnic minority participation to clearing away administrative hurdles to private investment and promoting the leading role of the State sector, merely a lot of fine words.

What of the overall socio-economic direction. While cautiously welcoming the leadership change, the Washington Post noted that “political analysts and diplomats say they do not expect Manh to move radically away from a socialist economy.”

This was certainly made clear in the political resolution. “Public ownership of the key means of production is the outcome of a developed economy with highly socialized, modern productive forces; it is to be established gradually and will hold absolute superiority once socialism has been built.” This path involves “bypassing the establishment of the dominating position of capitalist production relations and superstructure, but acquiring and inheriting the achievements recorded by mankind under the capitalist regime.” Well said.

This path “requires a long period of transition with many transitional stages and forms of socio-economic organization… In the period of transition, there are many forms of ownership of the means of production, many different economic sectors, classes and social strata… therefore there inevitably remain class contradictions and class struggle."

While promoting these many different sectors, the Socio-Economic Development Strategy calls for building “State corporations sufficiently strong to operate as the core of major economic groups, such as in petroleum, electricity, coal, aviation, railways, high sea transport, telecommunications, mechanical engineering, metallurgy, chemicals, building materials, import-export, banking, insurance, auditing etc.”

That of course shocks the economic rationalists, but not those of us who in the West have campaigned against privatisation of all kinds of public utilities, because we don’t believe people’s access to them should depend on the size of their wallet, or that planning in such basic areas should depend on the needs of the owner’s profit-making rather than human need.

It should be noted, however, that this wording only expresses an aim for the State sector – it does not any special privileges for it in terms of credit or subsidies, something which the Congress affirmed. According to FEER, “The advantage of ambiguity is that the broad platform does not commit Vietnam to a detailed plan to pump up the state sector at the expense of the private sector.”

That’s true. But neither does it prevent it from pumping up the State sector. The May 4 Viet Nam News, just after the Congress, announced that VND28.142 billion will be pumped into the electricity, coal, steel, electronics and information technology industries this year “to make them more productive and competitive.” Those advocating that this not happen are advocating that Vietnamese industry be smashed when it joins AFTA and the WTO.

According to the April 22 Washington Post, “foreign business and political leaders have been disappointed that this nation has not moved faster to inject free-market policies into its moribund economy, dashing hopes that it would become Asia's next economic force.”

Yes, there is always more that can be done, especially in terms of removing unnecessary and overlapping administrative hurdles and improving legal clarity. However, is it insignificant that, under the former leadership, the Enterprise Law was passed, resulting in 10,000 new business registrations last year? Or that last August, the Law on Foreign Investment was amended, leading to a 7 per cent increase in FDI capital in the first quarter of 2001 compared to last year?

Those decrying the decline of foreign investment over the last few years rarely remember the Asian crisis since 1997 – Asia is where most investors are from. The whole of the Third World is in fierce competition for foreign investment, 75 per cent of which flows between the developed countries – ie those with the biggest market – and half the remaining quarter goes to China. That leaves little for the rest of Asia, the Middle East, Africa and Latin America. Economic liberals are trying sell an illusion to Vietnam, that if you get down on your hands and knees, foreign investors will just flow in. Many foreign investors are already offered an eight-year tax holiday in Vietnam, something many local private businesses complain about.

Presumably, “Asia’s next economic force” means being like the economies which collapsed in 1997 due to a false boom and unfettered economic liberalism. According to Vietnam expert Adam Fforde from the National University of Singapore, “Vietnam delivered by far the best performance in ASEAN during 1998. This has been spectacularly ignored by the world, especially organisations such as the World Bank and the IMF. This is because Vietnam's still protected and 'unreformed' economy was her major source of protection. Not having followed some advisers and opened up her capital markets to foreign investors, there were no major opportunities for speculative positions to be taken against the dong, nor for capital flight.”

Many Vietnamese I speak to seem overcome by a grand inferiority complex in relation to Asia. The view that we are “far behind the region” has been repeated so often that it has almost become unquestioned. The implication is that open capitalism will accelerate Vietnam’s development.

I am an absolute dissident on this issue.

The fact that Vietnam is behind countries in the region in terms of GDP per capita is hardly surprising given that they had the opportunity to grow in peace for decades while Vietnam was being “bombed back into the stone age,” to quote US President Johnston.

However, a look at a number of key social indicators, rather than the often meaningless GDP figures, tells us that a socialist-oriented country, even in conditions as adverse as those in Vietnam, can bring about a considerably better spread of what wealth is created.

Vietnam’s key indicators - a literacy rate of 94 per cent, life expectancy at 68 years and an infant mortality rate of 29 per 1000 births (World Bank 1997 or more recent figures) – are roughly equivalent to or better than those of regional capitalist countries like Thailand and the Philippines which have far higher GDP levels. Malaysia does much better on infant mortality, but much worse on literacy.

As for Indonesia, a country with GDP per capita three times that of Vietnam, its literacy rate is eight points behind that of Vietnam, life expectancy three years behind and infant mortality is 47 per thousand – 18 points behind Vietnam.

In some respects, Vietnam is ahead of all of them – while it still suffers a maternal mortality rate of 105 per 100,000 births, the figure is double in Thailand and the Philippines (200, 210), while in Indonesia it stands at 390 – four times the Vietnamese rate. Similarly, Vietnam’s 96 per cent child immunisation rate, against 6-10 major infectious diseases, places it ahead not only of Thailand, Malaysia, Indonesia and the Philippines, but also South Korea, Hong Kong and Singapore – virtually the whole region except China and Japan. Vietnam has been “evaluated by the UN as a leading country in the implementation of the UN Convention on the Rights of the Child,” according to Morton Giersing, the UNICEF Representative in Vietnam.

One of Vietnam’s worst statistics is its 33 per cent child malnutrition rate, a continuing legacy of the US obliteration of Vietnam’s productive forces and years of embargoes. However, the rate was 53 per cent just five years ago – quite a dramatic reduction, given the Asian crisis took place during that period. In 1997 the Philippines’ rate was 33 per cent and that of Indonesia 42 per cent - before the onset of the crisis that has doubled the rate of poverty throughout capitalist south east Asia.

Notably, the United Nations Development Assistance Framework has commended Vietnam on the success of its poverty alleviation program, claiming “the rate of poverty has registered one of the sharpest declines of any developing country on record, falling from a high 58 per cent in 1993 to around 37 per cent in 1998 according to the World Bank’s poverty measure.”

Much of this reflects Vietnam’s better health infrastructure than the GDP-richer countries of the region. While this is not to deny that the situation is dire compared to anywhere in the First World, it is remarkable that, according to World Bank 1997 figures, there was one hospital bed for every 263 people in Vietnam, for every 500 people in Malaysia, for every 600 in Thailand, for every 910 in the Philippines and for every 1428 in Indonesia. In 1993, in Vietnam there were 1200 people per doctor, in Malaysia 2700, in Thailand 5000, in the Philippines 8300 and in Indonesia around 7000.

Is heading down the capitalist path then really a good idea, if having many times its current GDP translates into health, education and poverty levels either no better or considerably worse than at present? In fact, Vietnam’s relative strengths in these social fields reflect the continuation of an overall socialist framework, and a continuing commitment to redistribute the new wealth that the capitalist sector is helping to create. Much as market reform and development of a capitalist sector were necessary for Vietnam to break out of the bureaucratic centralist logjam in the 1980s, it is the cautiousness of this process that have allowed Vietnam to translate growth into relative equity. If it were purely the “market” and the capitalist sector that were doing the trick, then what went wrong in the rest of the capitalist Third World would be a mystery.

Over the last couple of years, there has been a certain push to further “liberalise”, ie privatise, agricultural land, which would result in vast land concentration and landlessness – the kind of society that the Communist Party overthrew. With relief, I saw that socialist ideals prevailed and there was no mention of it in the political resolution. Anyone who thinks it’s a good idea, and that Vietnam should follow the path of its neighbours, ought to look at what happens there to the absolutely landless.

For example, Vietnamese were shocked when the Philippine garbage dump landslide tragedy revealed that 80,000 people live on the dump outside Manila – and that’s only the example that came to light. So let’s not spread myths that the “free market” automatically sets up businesses to employ all these victims of the “free market” in land.

Likewise, glitter can hardly hide the fact that Thailand’s role in the “globalised” world has been transformed into the “global brothel”. NGO sources in Thailand claim some 2 million women and 800,000 children have been driven into prostitution (according to Naruemon Thabchumpon in the classic study of the Asian victims of pseudo-development, The Dispossessed). That’s a country where small farmers have been shut out of 50 per cent of all cultivable land by giant cash crop plantation owners.

Other strong points include the 26 per cent representation of women in the National Assembly, the highest in Asia and the ninth highest in the world, and the 17 per cent representation of ethnic minorities, who make up 13 per cent of the population. In 1999, Vietnam won the UN Population Award for its population and family planning efforts, conducted at a grassroots level largely by the Vietnam Women’s Union. Some 75 per cent of women aged 15-49 in Vietnam are estimated to use contraceptives, the third highest rate in the Third World (after China and Brazil) of those countries with estimates.

Market reform was necessary for Vietnam to break out of the bureaucratic logjam in the 1980s, but it is Vietnam’s socialist commitment to redistributing the wealth the private sector is helping to create that allows it to translate growth into relative equity.

That is why I am just as impressed with the policy continuity at the Congress as with the policy changes – sticking up for your principles in today’s world takes guts.

Moreover, who are others to lecture - the very land of the “free market”, the US, boasts GDP per capita 80 times that of Vietnam - and 37 million homeless. Vietnam can do better than that.

Finally, the effects of the US war are still major – Vietnam never saw a cent worth of reparations. The Hanoi-based NGO Resource Centre claims that seven million people are disabled. This is an incalculable economic burden on a poor and devastated country. During President Clinton’s visit last year, some criticised Le Kha Phieu for demanding the US accept its responsibility for the war and come up with significant reparations. I couldn’t have agreed with him more. I have been thrilled to see Nguyen Thi Binh continue to hammer away at that message recently. Despite the hype of Clinton’s visit, no significant money was promised to help clear this ordinance, while the US is still “researching” whether Agent Orange had any effect on its victims! (Of course there was plenty of money for his 2000-strong circus).

No economic approach is perfect. But considering what’s on offer and Vietnam’s particular situation, the direction pointed to at the Congress is largely appropriate for the “new millenium” – one in which most of the world’s problems, like the widening North-South divide, are the same or worse than in the last.