Good Morning, Vietnam

By RICHARD HORNIK/HO CHI MINH CITY

The snub-nosed .38 revolver aimed at Bay Lop's temple and the grimace on his face are etched into the memory of every American who read a newspaper in 1968. His summary execution by General Nguyen Ngoc Loan, chief of South Vietnam's national police, during the second day of the 1968 Tet offensive in Saigon altered U.S. public opinion about what was at stake in the war as much as any other event did. A quarter-century later, the victim's widow Nguyen Thi Lop, 60, lives in a decrepit house on the outskirts of what is now called Ho Chi Minh City. For a decade after the war, she and her three children were homeless. The Vietnamese government provided shelter only after a Japanese TV crew found her living in a field. Yet she exhibits no rancor: "I am proud of the death of my husband. It was a signal to end the war in Vietnam. I never blamed Americans, but I condemn Loan."

The fate of Lop, a captured Viet Cong captain, was a starkly dramatic moment in a nationwide battle that lasted 25 days and was fought in more than 100 cities, towns and military bases. Perhaps 37,000 South Vietnamese guerrillas and North Vietnamese soldiers died during Tet and subsequent cleanup operations. The losses of the American and Saigon-regime forces were about a tenth of that. Tet was a crushing defeat that practically annihilated the political and military capabilities of the Viet Cong. Yet the offensive marked the beginning of the end of U.S. involvement -- a disengagement freighted with national guilt and recrimination and completed in disarray in April 1975.

The offensive was a gamble by the communist leadership in Hanoi to break the momentum of the U.S. war effort. "The American military was so huge we could not possibly destroy it, so we had to destroy America's will to fight," says legendary military strategist General Vo Nguyen Giap, who served as North Vietnam's Defense Minister in 1968. "And by that measure, the Tet offensive * succeeded." America's leaders had convinced their public that the war against communism was being won at a reasonable cost. Tet shattered that myth.

But the Tet offensive finds no place in the Vietnamese pantheon of military victories. The government did not even bother to commemorate the 25th anniversary of the battle this year. Today, says a journalist who lives in the south, "most people here just want to forget about it, and most young people just don't care."

On the other hand, four successive U.S. Presidents have sought to punish Vietnam through an economic embargo and diplomatic isolation. It is impossible to determine whether the Vietnamese economy was damaged more by those policies or by the misguided efforts of Ho Chi Minh's heirs to impose a Soviet-style system on the unified country. But the combination proved devastating. By 1985, 10 years after "liberation," Vietnam was on its knees and heavily dependent on aid from its chief ally, the Soviet Union.

In 1986, however, Hanoi's leaders launched an economic-reform program called doi moi. After a halting beginning, the regime began aggressively removing central controls and subsidies in 1989. None too soon. When Soviet aid suddenly vanished two years later, the newly unshackled economy showed unexpected resilience, and last year it was growing at a robust 8%. Much of the growth still comes from state-owned firms that must now make a profit or fold. But the government has also unleashed the forces of private enterprise.

In the new economy, old soldiers need not fade away or write their memoirs. After retiring from the military, Colonel Tran Minh Duong, 59, started a small salt-processing venture in a Ho Chi Minh City suburb. It's a radical change for the man who commanded the force of about 3,000 that seized the citadel in the South Vietnamese city of Hue, the country's ancient imperial capital, and held it for 25 days in Tet's bloodiest battle. Duong speaks eloquently of the trials of his men back then, but he speaks with equal pride of how he now sells his salt through neighborhood residents, giving them a chance to make money as well. Duong would like to meet some of the Americans he fought against to compare notes. "For war veterans we are friends now, not enemies," he says.

If the Vietnamese are not captives of their past, they are certainly enterprising enough to make a buck from those who are. The Vietnam War Veterans Association of Ho Chi Minh City has formed "CCB Tour," which has designed specific trips for veterans of each American military unit that served in Vietnam. They even provide former Viet Cong officers as guides.

But the country's aging leaders are of two minds about increased contact with the U.S. They understand the need for foreign capital and economic know- how but fear a peaceful democratic revolution that would gradually destroy their authoritarian regime. In 1991 Hanoi normalized relations with China, an ancient nemesis but fellow communist holdout. It hoped the move would reduce Vietnam's need for "imperialist" investment. Instead Beijing brazenly reasserted numerous territorial claims, particularly in the oil-rich South China Sea. Meanwhile, Chinese entrepreneurs flooded Vietnam with cheap consumer goods, endangering the economic health of many Vietnamese firms. "The leaders have no more illusions about China," said a Hanoi official.

With few places left to turn, Hanoi finally focused on the one issue it and the Americans have never been able to resolve: What were the fates of the 2,261 U.S. servicemen listed as missing in action during the war? By the middle of 1992, American MIA investigators had found a new readiness in Hanoi to cooperate. As a result, the Bush Administration became encouraged enough to ease the embargo by permitting American firms to open offices in Vietnam and negotiate, but not fulfill, commercial deals.

None too soon. At least that's the position taken by U.S. businessmen and investors who believe Washington's vindictiveness is beginning to backfire. Asian and, increasingly, European businesses are rushing to get in on what could be the next Asian economic miracle. Americans, at this point, can only stand by and watch. Says Frank Hawke, Citibank's point man on the country: "Vietnam's culture emphasizing sacrifice, education and hard work is similar to that of the other economic success stories in East Asia. And unlike Taiwan, Hong Kong, Singapore and South Korea, Vietnam will be a net exporter of foodstuffs and energy for the foreseeable future."

Last year foreign investment reached almost $2 billion despite the American embargo. Taiwan leads the way with $1.1 billion, more than twice that of its nearest competitor, Hong Kong. Until recently Japanese businessmen stood impatiently on the sidelines constrained by their government's informal adherence to the U.S. embargo. But in November Tokyo announced the resumption of foreign aid to Vietnam. That was the sign for major Japanese firms, which had been operating through foreign subsidiaries for several years, to enter the Vietnamese market with a splash. Already there is a gleaming Toyota showroom in Ho Chi Minh City. Says Tran Bach Dang, one of the top three commanders of the Tet offensive: "I could almost understand the embargo before, but now it makes no sense. Does America want Japan to take over this whole region?"

Rapid economic growth and opening its markets to the outside world have taken a sad but predictable toll on the country's traditional values. Police estimate there are 50,000 prostitutes in Ho Chi Minh City, more than in 1975. Drug addiction is a growing problem. That in turn is boosting petty crime. Dozens of pickpockets, beggars and touts prey on unsuspecting foreigners in the square in front of city hall, within the gaze of an avuncular statue of Ho Chi Minh. Says a local official: "This is the price we must pay in order to leave our impoverished state."

These problems only further confuse the gerontocratic leaders in Hanoi and reinforce their fear of change. The social problems so reminiscent of those that plagued the country during the American occupation also strengthen the hand of the already powerful security forces, who insist on keeping the country a police state. Although in 1992 Hanoi released the last political prisoners held because of service to the old Saigon regime, thousands of new "enemies" have been discovered. The police may not be able to stop banditry, prostitution or corruption, but woe to anyone openly critical of the government. The regime has even launched a harassment campaign against the relatively benign Unified Buddhist Church of Vietnam, seeking to force it to merge with the government-approved Vietnam Buddhist Church. Says a Saigon observer: "It seems our leaders think they are still fighting in the jungles."

But in spite of Vietnam's political problems, this nation of 70 million highly motivated people is poised to succeed. The majority would like America to be involved both for nostalgic reasons and because, as far as the long isolated Vietnamese are concerned, American products are still by far the best available.

The Clinton Administration may choose to keep the embargo against Vietnam. On the other hand, Clinton could side with those who believe that if he renews relations he will complete the painful process of healing. Bay Lop's widow is ready. "My husband died for our independence," she says, "but my son has studied English. If he could work for a new American consulate here, I would be glad."