Vietnam War Era: American Advisers and the Invention of South Vietnam, 1954-1960

James M Carter. Vietnam War Era: People and Perspectives. Editor: Mitchell K Hall. ABC-CLIO, 2009.

Commenting on the U.S. nation-building project in Vietnam in the 1960s, American adviser Frank C. Child wrote that southern Vietnam was in its “eleventh hour.” The efforts to build democracy and promote economic development floundered. Meanwhile, southern Vietnam had become “a police state.” Corruption, waste, incompetence, favoritism, and zealous and reaching government controls all plagued the project. All the effort to construct a new, modern, democratic state below the 17th parallel in Vietnam had instead brought this: “the shortcoming of [the] regime is not that it is undemocratic,” Child (1961) wrote, “it is that it is a failure. It has neither of the two saving graces of an ‘acceptable’ dictatorship: it is neither benevolent nor efficient” (14). During the Vietnam War, similar criticism became commonplace. What is surprising and instructive about this critique is that it came when it did.

Years before U.S. policy in Vietnam expanded into wide-scale warfare and captured the attention of the nation, many advisers closest to the project already anticipated tragedy. Political science professor Wesley Fishel headed the Michigan State University Vietnam Advisory Group (MSUG), charged in 1954 with building the new state of South Vietnam. The United States entrusted President Ngo Dinh Diem to lead this new state, but advisers held few illusions regarding the magnitude of the task at hand. Shortly after arriving in Saigon, Fishel wrote with alarm, “I’ve never seen a situation like this. It defies imagination…. The government is shaky as all hell. It is being propped up for the moment only with great difficulty. Nothing can help it so much as administrative, economic, and social reforms…. The needs are enormous, the time short” (Carter 2008, 56). By the time Frank Child returned home in 1961, the United States had already spent around $2 billion in Vietnam. Child, a Stanford University economics professor, worked with the MSUG in Vietnam for two years. The experience left him pessimistic, as he concluded, “it has become clear that Diem can only postpone defeat—he cannot win” (Child 1961, 14-16). Although American architects of the enormous war that followed were loath to admit failure, their colleagues responsible for building the new state in southern Vietnam in these early years had already conceded the point.

During 1954-1960, American advisers to Vietnam accepted the challenge of nation building, believing the United States was uniquely positioned to stem the expansion of communism and provide the model for national development in former colonies then moving toward independence. In the process, they faced the many inherent contradictions and obstacles in U.S. Cold War policy toward the Third World. As their efforts floundered in the face of these contradictions and mounting native resistance, they slowly alloyed their optimism with growing realism, skepticism, cynicism, and frustration, well before those sentiments became commonplace in the American media and in Washington in the 1960s.

Building “South Vietnam”: The USOM And MSUG

After only a short time in Vietnam, Wesley Fishel enjoyed considerable support from and influence on Ngo Dinh Diem, and he eagerly assumed the role of presidential adviser. The relationship between Saigon leaders and Michigan State University (MSU) solidified quickly, and by spring 1955, Fishel and a number of other MSU specialists were working closely with a few Vietnamese to provide assistance in public administration, police and security, finance, and economics. Despite a near total lack of governmental infrastructure and the admittedly narrow base of support for Diem, American advisers remained optimistic that they could build a state around his leadership. They had their work cut out for them.

In 1954 all of Vietnam suffered from years of war, neglect, dislocation, and political chaos. In addition to political difficulties, the physical infrastructure and economy of southern Vietnam remained undeveloped, damaged, or abandoned. The political division of the country at the 17th parallel further aggravated the situation. While various military and governmental officials worked out the transition from French to American influence, Saigon became a veritable laboratory for development initiatives.

Wesley Fishel was uniquely positioned to influence events because of his personal relationship with Ngo Dinh Diem. Edward Weidner, chief adviser of the MSUG, recognized Fishel’s importance to the program when he arrived in Vietnam in early October 1954. Cabling MSU president John Hannah, Weidner explained that “the situation here is extremely serious” and that according to the “highest authority … Professor Wesley R. Fishel is quite essential to American policy as long as Diem stays in power” (Carter 2008, 58). Fishel seemed to be especially proud of his relationship with a foreign head of state, writing to Weidner a couple of weeks earlier, “I go in and out of the palace so often these days I’m treated as one of his [Diem’s] staff by the guards. Yesterday I was there for 15 hours, and on Saturday for 19 hours. Today is abnormal … I’ve not been in the place for five whole hours now” (Carter 2008, 58).

A team of university specialists spent that fall pasting together a political regime in Saigon. In addition to Fishel, this mission included MSU political scientist Edward Weidner, Arthur Brandstatter as a specialist on police administration, James Denison as a public relations specialist, and economics professor Charles Killingsworth. Of the group, only Fishel was considered an Asia expert. The rest read what they could at MSU and en route to Vietnam. The team conducted a brief two-week survey and pieced together an aid program based on its findings. The report, submitted in October, recommended emergency measures in public administration, police administration, and efforts to shore up the economy. With the aid of Fishel and MSU faculty, Diem and other Saigon leaders initiated a crash program to install a political structure that could ensure control over and development of the southern half of Vietnam.

In 1954-1955, Diem survived a number of serious challenges to his position. In spring 1955, he surprised his critics by effectively routing his political rivals with a show of force in the so-called Battle of Saigon. In doing so, he also provided a justification for continued U.S. support. The MSUG began its work in the immediate aftermath of that apparent triumph. To survive the Geneva-mandated national elections of 1956, the MSUG, the military, and others involved rapidly built a government infrastructure and aggressively promoted Diem to stabilize, popularize, and legitimize his rule.

The MSUG found the existing police system lacking proper authority, organization, trained personnel, buildings, and equipment. In July, Howard Hoyt recommended to Brandstatter that the MSU program scrap “everything else,” such as the Gendarmerie, Sureté, “and all other various enforcement agencies.” He believed they were all “going around in circles, stepping on one another’s toes,” and that the MSUG “should at least set the example” of how a police system ought to work (Carter 2008, 66).

The security apparatus needed far more than a fresh coat of paint. Chief adviser Weidner worried “about the future of democracy in Vietnam” because of the degree of insecurity and the inability of Saigon’s leadership to address the problems (Carter 2008, 66). Reorganizing, training, and equipping a police force occupied much of MSUG’s energy over the course of the next couple of years. Advisers almost completely rebuilt the police structure, updating equipment; importing modern fingerprinting methods; providing training in various police tactics and weaponry; and funding the construction of facilities such as vehicle garages, barracks, interrogation centers, detention centers, and crime laboratories. In 1956, MSUG further centralized the system by moving the Vietnamese Bureau of Investigation (VBI) to Saigon, where it received much of the police program’s attention and funding and became a showpiece for the project.

At the same time, the various American groups held different priorities for nation building in Vietnam. Diem took advantage of the newly crafted police system to eliminate his political opposition through harassment and intimidation, and by imprisoning more than 20,000 by 1956. MSUG advisers criticized the increasing militarization of the civil police forces, the Civil Guard, but the regime ignored their advice and channeled equipment to favored units. Police engagement in combat operations and complaints of police brutality from ordinary Vietnamese mounted. Finally, in 1957, the MSUG cut off further funding for the Civil Guard. The United States Operations Mission (USOM) quickly filled the gap. With Washington’s approval, the latter restored funding and the militarization of the regime’s police system proceeded. This incident highlights the growing differences over the proper course of state building in Vietnam.

Besides the police project, the MSUG also spent considerable effort and resources on public administration. The program involved providing training in comparative administration, fiscal and budgetary problems, political science, public administration, comparative governments, and management of private enterprise. An additional facet of the program involved foreign training in such places as the Philippines, Malaya, Hong Kong, and particularly the United States. Additionally, around 325 foreign-educated Vietnamese returned to Vietnam after Diem ascended to power and filled positions in the civil service. As one MSUG member pointed out, however, the main “external source of trained civil servants is the study programs financed by the American government” (Scigliano 1963, 64-65).

Officially known as the Participant Program, MSUG and USOM sought out exceptional Vietnamese students to continue their education in the United States before, hopefully, returning to government service in Vietnam. Diem also prompted the MSUG to seek out Vietnamese students already in the United States to provide instruction at the National Institute of Administration (NIA) in Saigon, which trained people for careers in government. Adviser Stanley Sheinbaum described it as “primarily a technical assistance program not a cultural exchange” (Carter 2008, 71). Estimates of the number of participants vary greatly. Through 1961, the MSUG sponsored 179 Vietnamese and the USOM sponsored 1,705 more, most of them trained in the United States. According to MSUG adviser Robert Scigliano (1963), however, these numbers are only a fraction of the actual number of Vietnamese trained in the United States during the period. In any event, the NIA facilities in Vietnam trained a large number of students, enrolling between 200 and 300 per term (and about 500 per term in the evening school) and training thousands more through an in-service program.

Some MSUG members viewed the training project in Vietnam as only marginally successful. Advisers and instructors grew frustrated over the Vietnamese reluctance to establish a school based on the American system. Some Vietnamese, for example, relied on the old French system that emphasized lecture and limited classroom interaction. MSUG personnel later complained that, while understandable, Vietnamese were “unwilling to sit in on classes taught by MSUG professors, and almost equally reluctant to offer courses jointly with them” (Ernst 1998, 51). The problems extended to more than just matters of style. There were also obvious cultural differences aggravated by language barriers. Furthermore, as in a number of other instances, the Diem regime insisted on very close scrutiny of the program and of potential candidates. Diem, either personally or through a designee, demanded ultimate oversight, creating a bureaucratic logjam and increasing the time required to fund, approve travel, train personnel, and fill positions in the government. Further, as Robert Scigliano (1963) later noted, the system was handicapped “by the government’s insistence upon furnishing it with weak leadership, using its faculty positions as a convenient dumping place for civil servants not wanted elsewhere.” Consequently, the NIA did not “enjoy a high reputation among high government officials and intellectuals generally” (65).

Despite the difficulties, the institute ultimately trained tens of thousands of people in conjunction with the in-service, participant, and other types of formal training. Over the course of the multiple programs inaugurated from 1955 until 1957, American aid projects created enough of a government to be relatively sanguine in progress reports. The Police Administration continued to train tens of thousands of new police, from VBI agents to municipal officers, despite MSU’s suspending aid to the Civil Guard in 1957. Overall, personnel on the MSUG staff increased to a high of 182, excluding those employed directly by USOM (Carter 2008). Indeed, the program expanded considerably and events, despite occasional setbacks, seemed to justify increased effort.

By 1957, some of the more serious obstacles seemed less formidable. The October 1955 referendum effectively removed Bao Dai from power. Diem seated his National Assembly early the following spring with pomp and circumstance and little substance. Diem approved or handpicked 90 of the 123 members to ensure passage of a constitution drafted by him and his coterie of advisers (Anderson 1991). With the support of the United States, Diem was building all the accoutrements of a democratic government while retaining ultimate control. The date for the Geneva-mandated national unification elections came and went during 1956. Neither the United States nor Diem planned to comply with free elections that the communists would almost surely win.

By 1957, the American country team assured itself that the “newly created nation would survive successfully the series of crises which threatened its existence at the outset” (Carter 2008, 85). Beginning the following year, the aid mission, in conjunction with the Saigon regime, pursued a number of long-term projects. Most American advisers now assumed that the period of emergency had passed and that economic development and the creation of a modern national infrastructure would occupy the lion’s share of their energies into the later years of the decade.

In addition to police and public administration training, the USOM oversaw substantial development aid to southern Vietnam for projects in a number of other fields. The USOM awarded lucrative contracts to numerous private firms to facilitate internal economic growth and build the necessary basic infrastructure in Vietnam. Director Arthur Gardiner told a Senate investigative committee in 1959, “You would be astonished … at the amount of business that has gone on in Vietnam under that [aid] program without any interference by the diplomats or the bureaucrats.” His agency released $7.4 million to finance road and bridge construction in 1959 (Carter 2008, 89).

American firms Capitol Engineering and Johnson, Drake and Piper built a system of roadways stretching across southern Vietnam. National Route 21, completed in 1960 at a cost of $14 million, linked Ninh Hoa along the coast to Ban Me Thuot further inland and became the largest aid project since the resettlement of Catholic refugees during 1954-1955. Barely a road at all as late as 1957, the artery now boasted two well-surfaced lanes, built according to modern standards, that provided year-round access. The road dramatically reduced transportation costs and “greatly increased the exchange of commodities.” The Saigon-Bien Hoa Highway consisted of nearly 20 miles of roadway, two major bridges (the two longest ever built in Vietnam), six intermediate bridges, drainage systems, and erosion and traffic controls. Surfaced in asphaltic concrete and more than 52 feet wide, complete with stable shoulders for heavy military traffic and built through swamp conditions, this road showcased the technological and individual hubris of the American mission. For these and other road projects, the American mission provided $18 million worth of tractors, power shovels, maintenance equipment, and spare parts. USOM trained thousands of Vietnamese for these jobs and contractors furnished technical manuals for the trainees (Carter 2008, 90).

To industrialize the country and integrate it into a market economy, in late 1957, the U.S. aid mission and the Saigon leadership established the Industrial Development Center (IDC). Southern Vietnam possessed only small-scale industrial concerns such as cigarette making, rice milling, small ship building, some sugar refining, and cottage industry textile manufacturing. The USOM saw possibilities in developing coal, limestone, iron, and gold and copper mines and in constructing hydroelectric dams in central Vietnam. Although resources turned out to be less abundant than initially hoped, advisers believed the economy had to diversify to survive a volatile world market. Relying on rice production and limited coal production left southern Vietnam vulnerable. The IDC fostered industrial diversity through financial and technical assistance, offering loans to would-be entrepreneurs. The Commodity Import Program (CIP) also financed imported capital goods for industrial projects, such as heavy equipment and machinery. The project oversaw the launch of a variety of businesses in industries ranging from textiles, ceramics, and soap to tobacco, pencils, and dinnerware.

Though initially ambitious, the IDC began with a number of entrenched and stubborn handicaps. The idea behind the scheme was, of course, to foster business and industrial growth, create an internal source of wealth, and wean the client from American aid. To increase private-sector industrial production would, in the eyes of American planners, encourage foreign and private investment and private ownership. Diem and his brother Nhu, however, emphasized government ownership of business enterprise. As Nhu explained to the American ambassador, he wanted to pursue a “third way” between the heavy state planning of communism and capitalism’s emphasis on private ownership and market forces. A “mixed” economy of some government-owned enterprise and private ownership solved the lack of expertise, managerial skill, and risk capital because the government provided initial financing for capital ventures. Ultimately, as Nhu and Diem both pointed out, private concerns would take over these business enterprises.

From the outset, Saigon and the U.S. advisory mission clashed over these differences. Ironically, the compromise hammered out to begin the IDC undermined the program. The agreement kept American aid available to government firms, while making counterpart financing available to would-be importers. Through the CIP, the United States would use imports to make capital available to the regime, promote economic growth, and stymie inflationary pressures. Because commodity imports were entirely subsidized by the U.S. aid program, importers reaped enormous profits before any real exchange of commodity, thus discouraging manufacturing. Because the exchange rate alone guaranteed profit, and Diem tightly controlled access to funding, private foreign investment remained limited. Only 4 of the more than 100 loan applications received by the spring of 1959 received any assistance. Consequently, the IDC effectively became “a holding company for government enterprises,” and the flow of American aid provided safe and certain profit to a business class eager to take the path of least resistance (Trued 1960, 258-261).

Industry remained a minor part of the overall economy. Although industrial enterprises such as coal, sugar, textiles, and glass expanded and were nurtured along by the regime, the industrial sector never approached the level necessary to reverse the constant trade imbalance. Imports fluctuated from $232 million in 1958 to $225 million in 1959 and back to $240.3 million in 1960, and imports continued to outstrip exports. Exports for the same years were $55.2 million, $75 million, and $84.5 million. From 1960 until 1972, in fact, the largest growth sector for the economy was government, which grew 10.6 percent. In contrast, agriculture grew by only 0.6 percent (Carter 2008).

Rice and rubber remained mainstays of the export economy, accounting for 80 to 90 percent of all exports through the 1950s and into the 1960s. Even these products, however, fell short of requirements based on population growth. Other crops, such as sweet potatoes, sugarcane, peanuts, and corn, steadily expanded, although they never contributed significantly to the trade imbalance (Fall 1967). The aid program nurtured greater dependency rather than modernization and eventual independence for the new state.

Vietnam had long been primarily an agricultural nation. Four-fifths of southern Vietnam’s labor force worked in agriculture, and of a population of 13 million, 11 million lived in the rural environment. No more than an estimated 20 percent of American aid ever reached the countryside in a way that was recognizable to the people (Scigliano 1963). Southern Vietnam could not be effectively modernized and developed into a sovereign state if the vast majority of the people remained isolated in their villages and hamlets.

The aid mission envisioned transforming the Vietnamese agricultural economy by discarding “out-moded traditional production methods” and creating a “self-reliant nation of high proficiency” by implementing the most modern farming techniques and technology from the West. Soil analysis could determine the most efficient crops, while fertilizers and pesticides would reduce parasite damage. Introducing new varieties of fruits and vegetables, such as okra, eggplant, peppers, dry onions, potatoes, and garlic, would further diversify Vietnam’s economy, and improved strains of sugarcane would replace and revitalize that crop. Individual farmers needed to become more efficient and the yield per hectare dramatically increased (Carter 2008, 93-94). With increased production Vietnam could boost exports of various commodities and ultimately become self-sufficient. Improved infrastructure, including roads and bridges, would provide farmers with an expanded market. The whole process would make peasants both more self-interested and interested in maintaining the new production system as their livelihood now depended on it. Furthermore, failure to reach out to the countryside threatened not only to fatally delay the ultimate goal of expanding agricultural production, but it also threatened the continued existence of the regime in Saigon.

For this reason, Diem continued to channel American aid to the countryside not only for road and bridge construction, but also for an increased military presence that harassed and jailed thousands of people and waged a propaganda campaign against his growing opposition. A number of officials believed Diem paid insufficient attention to industrialization or agriculture. As the situation in the countryside deteriorated during the late 1950s, economic development became less urgent. That deterioration created significant fissures within the American country team and between it and Saigon officials. By 1959, divisions over the proper use of American aid reached a critical juncture when key events drew a level of public attention and scrutiny not seen since 1954.

Nation Building and the Politics of Foreign Aid

As more policy makers, journalists, military figures, and advisers questioned the efficacy and use of aid monies, the added attention exposed numerous problems. Some leveled accusations of outright corruption; others charged enormous waste and inefficiency. Part of the problem stemmed from the inability of officials to identify substantive results. Many could quote specific numbers for railroad track mileage, roadways rebuilt, canals dredged, and police and military personnel trained, but reports on South Vietnam’s self-sufficiency were less than glowing and riddled with inconsistencies and ambiguities. These problems came to light in a series of 1959 investigative articles written by Albert Colegrove for the Scripps-Howard newspapers.

Colegrove found evidence that substantially supported this negative view of American aid to Vietnam. He spent nearly three weeks in Vietnam turning up numerous examples of waste, mismanagement, favoritism, fraud, and widespread disinterest in the dispersal of American funding. Published under the title, “Our Hidden Scandal in Vietnam,” the articles appeared in more than 15 newspapers with a nationwide audience of over 2.6 million. Colegrove charged the aid mission with losing 2,700 vehicles, failing to account for $34 million given to the Saigon regime, paying for more than a dozen nonexistent radio towers, subsidizing lavish living standards for Americans in country who never left the confines of Saigon, and losing $8 million in a 1955 fire, among others (Montgomery 1962, Appendix III). Not surprisingly, the articles caused a sensation in the media, and Congress quickly convened hearings to investigate the aid mission to Vietnam.

The U.S. mission immediately condemned Colegrove and the Scripps-Howard newspapers. USOM director Arthur Z. Gardiner testified to Congress that the claims were completely erroneous. Similar testimony came from Assistant Secretary of State for Far Eastern Affairs J. Graham Parsons, Ambassador Elbridge Durbrow, the Military Assistance and Advisory Group (MAAG) chief Lt. Gen. Samuel T. Williams, and others. Williams denied any record of the 2,700 vehicles mentioned; Durbrow claimed there was no cost-of-living allowance that provided “luxury” for the American mission; and Gardiner assured investigators there were no missing radio towers. Colegrove himself took the witness chair and maintained his ground, even offering to provide additional witnesses if needed (Carter 2008). The hastily convened hearings ended in a stalemate. No conclusive evidence emerged that the program was quite as corrupt as the articles had portrayed. Nor did officials manage to dispel suspicion of a broken aid program.

Diem’s American advocates rallied and quickly scuttled the Colegrove exposé. The American Friends of Vietnam publicly denounced the reporting as “grist for the Communist propaganda mill.” The organization’s chairman, Gen. John “Iron Mike” O’Daniel, called Colegrove’s effort “a disgraceful example,” even “yellow journalism” larded with “misinformation” and “plain unvarnished sidewalk gossip.” Meanwhile, Wesley Fishel attempted to discredit Colegrove’s story by reporting his brief Vietnam itinerary to the American Embassy. Fishel dashed off a letter to Sen. Mike Mansfield, who had recently engaged in “increasingly frequent attacks” on the aid program, to inform him that Colegrove was merely a “malicious sensationalist” who would soon be discredited as the facts came out. The MSU professor also played the public relations angle, organizing a conference on Social Development and Welfare in Free Vietnam. He cajoled President Diem into allowing Vice President Nguyen Ngoc Tho to attend to increase the regime’s visibility in the United States and to showcase “the progress which can be expected when a Southeast Asian country is well led and when its ideological guidons keep it stable, peaceful, and progressive.” Fishel cited the Colegrove articles and the attention they attracted as threats to continued approval of aid monies from the U.S. Congress (Carter 2008, 101-102).

Almost simultaneously in Vietnam, however, the situation undermined the claims of these American mission officials. From May to July, for example, the periodical Times of Vietnam, noted for its pro-American perspective, reported the arrest of three well-placed Vietnamese officials for an array of crimes. Militia second lt. Tran Quoc Thai and Ngo Van Huan, an official of the Commissariat for Refugees, were convicted for embezzlement, and Capt. Dang Nhu Tuyet was convicted for embezzlement, false arrests, and receiving bribes. The Saigon government was so concerned with growing corruption that it made embezzlement of government funds punishable by death.

In October, the Scripps-Howard newspapers published a story that alleged fraud within the MSUG as well. What came to be termed the Rundlett Affair involved MSU adviser Lyman Rundlett giving contracts to Motorola, his former employer. The USOM reported that Motorola actually bid lower than competitors “on only two of the 31 items contained in the Invitation to Bid.” Further, the American Justice Department had reportedly been investigating allegations that Rundlett received financial kickbacks for allowing the company to supply police radio equipment to the Diem regime (Ernst 1998, 75). Rundlett never faced charges, and he soon departed Vietnam and resumed employment with Motorola.

Following up on the investigation, a congressional delegation journeyed to Vietnam late in 1959 to conduct on-site hearings, interviews, and inspections. Heading the delegation were senators Albert Gore Sr., Gale McGee, and Bourke Hickenlooper, and representatives John Pilcher, Harris McDowell, Dante Fascell, Marguerite Church, and Walter Judd. Senators Gore and McGee sharply disagreed over what they saw. McGee observed “the most exciting and imaginative [aid program] of any … around the world.” Gore was “shocked and disturbed” at the “slack-jawed laxness with which our tax money is being handled.” The Saigon hearings also cast in relief the tense relations among all parties involved: the U.S. Congress seemed not to believe the official story given by aid mission members; the ambassador and the MAAG chief squared off over who actually was in charge; the Vietnamese were miffed at the arrogance of the delegation in assuming authority on Vietnamese soil; and the added scrutiny strained relations among the MAAG, the ambassador, the Saigon government, and the MSUG (Carter 2008, 102-104).

Senator Mansfield ultimately steered Congress away from the fundamental question of the efficacy of the current U.S. aid programs in Vietnam. Rather, he gave assurances that despite public statements by senators Gore and McGee, the issue “would be framed in such a way that its [the subcommittee’s] recommendations would be generalized for the whole aid program rather than specifically directed toward Vietnam.” Consequently, the final report is littered with detailed criticisms from the way contracts were awarded to the chain of command within the American mission. All recommendations, however, point to greater command and control, increased congressional oversight, and a general tightening of the budget. Mansfield explained to Senate Foreign Relations Committee chair J. William Fulbright that although “Vietnam has made a great deal of progress,” the time had come for a “reshaping” of the aid program to make it more “efficient” and “effective” (Carter 2008, 104). Mansfield recognized that deeper questions and greater scrutiny of the program threatened Congress’s ability to continue supporting the Diem regime and to control that support.

The Diem Regime and the Rise of the Insurgency

The Saigon regime had by this time a well-established presence beyond that city. Aside from the development of transportation and communication infrastructure, Diem had eliminated many elected village council posts in favor of direct appointments under his control. As he larded village and municipal councils with his own people—often outsiders—he eliminated an important degree of local autonomy and further centralized his administration. Saigon alienated many people by having these appointees implement denunciation campaigns aimed ostensibly at communists but reaching well beyond. By mid-1956, less than one year into the “denounce the communists” campaign, officials reported that more than 94,000 cadres “rallied to the government,” more than 5,600 surrendered, and 15,000 to 20,000 were placed in camps. Between 1954 and 1960, almost 50,000 people were jailed. The official numbers reflect only a portion of the real damage done. As oppressive tactics became normalized, channels of political and social expression ceased to exist for ordinary Vietnamese. Local officials jailed hundreds of people without evidence so they could extort money or eliminate possible rivals for power. In Long An Province, for example, the Cong An security agents became notorious for inflicting terror and practicing extortion (Kahin 1987, 96-98).

Diem solidified his police state with the introduction of Law 10/59 in May 1959. This law reached well beyond earlier efforts in prescribing the death sentence, without right of appeal, for any act that could be construed as “sabotage” or as “infringing upon the security of the state” (Kahin 1987, 98). Diem’s security forces rounded up suspected subversives, Viet Minh cadres, and those related to or suspected of supporting them; tried them before military tribunals; and sentenced them, all in three days. Although it disrupted the revolutionary effort in the countryside, this decree also caused a great backlash among villagers who feared and resented the regime. By 1959-1960, American observers were increasingly concerned that the whole experiment might be undermined by such policies. Even such indomitable supporters as Wesley Fishel warned Diem of the growing image within some circles in the United States of an emerging dictatorship in Vietnam, and the damage that would have on continued support. In a lengthy and thoughtful memorandum, Ambassador Durbrow also warned, “we should be prepared to acknowledge to ourselves that even over the longer term democracy in the Western sense of the term may never come to exist in Viet-Nam.” Instead, the United States would have to learn to live with autocratic leadership and not attempt “to make over Viet-Nam in our own image” (Carter 2008, 106, 108). It was within the breathing space created by this contradiction that the Diem regime flourished and redoubled efforts to tighten security over the whole of southern Vietnam.

Diem based his increasing concerns over security issues on mounting evidence of a growing opposition. As early as 1957, assassins made a bold daylight attempt on the president’s life at the opening of the Ban Me Thuot Economic Fair. Bombings, ambushes, and sabotage, as well as intimidation, harassment, and assassination of officials loyal to the Diem government had been escalating for several years. Assassinations of officials, for example, rose from approximately 700 in 1958 to 2,500 in 1960 (Herring 2002). The regime’s aggressive security measures contributed to the opposition. The program of forced resettlement into agrovilles in 1959, for example, generated a great deal of resentment from the people. The first of many similar schemes to come over the years, the agroville program relocated large numbers of Vietnamese into concentrated zones along major transportation routes. Once concentrated, the peasants no longer provided the insurgency with a base of operations and sustenance. The effort smacked of the old colonial system of corvee labor as the government forcibly removed people from their farmlands and ancestral tombs to build their new quarters, occasionally out of materials from their dismantled former homes, and to construct the camp, all without recompense. Local officials took advantage of the confinement to extort money and goods, while meting out physical abuse and torture. Within the barbed wire surrounding these camps, not surprisingly, opposition only grew. Amid obvious failure and growing protest over the camps, the regime finally abandoned the effort, but not before it had demonstrated to large numbers of Vietnamese the necessity of resistance.

In April 1960, 18 well-placed officials demonstrated that government-generated hostility reached even into the cities. The group, including four former government ministers, issued their manifesto calling for a recognition and inclusion of opposition parties and asking the president to “liberalize the regime, promote democracy,” and “guarantee minimum civil rights” to end the government’s alienation of the people and stave off collapse. This Caravelle Manifesto was widely publicized, particularly in the United States, and caused considerable alarm among Diem’s Vietnamese and American supporters. Wesley Fishel, who had warned his friend earlier of the betrayal of the intellectuals, advised “discrediting [the manifesto’s] authors by presenting to the world their records of past collaboration with the French and with Bao Dai.” Fishel urged Diem to forward brief biographies on each of the signers and promised he would “see what can be done” in the United States to counter their efforts. The regime immediately attacked the group as enemies of the state and moved to malign their individual reputations (Carter 2008, 108). Diem refused to allow publication of the manifesto and harassed and arrested some of those involved. As historian David Anderson has pointed out, however, “the complete ineffectiveness of the protest laid bare the truth of its charges.” The government was not about to reform or to allow such criticism. The episode exacerbated tensions between different elements of the country team, with the ambassador, MAAG chief, and Diem increasingly at odds over how to proceed as the people grew restless and protests mounted (Anderson 1991, 184-186).

The regime became increasingly paranoid. The Can Lao, or Personalist, Party enveloped the president and his family to prevent encroachment from outsiders but also to prevent the intrusion of unwanted criticism and advice. Officially known as the Revolutionary Labor Personalism Party, this organization represented the ruling elite and served as an anticommunist, pro-Diem propaganda machine tightly controlled by Diem’s brother, Ngo Dinh Nhu. With its emphasis on conservatism, hierarchy, and position, personalism justified rigid and authoritarian rule. However, the doctrine mattered little because very few Vietnamese actually adhered to or even understood it. It became another in the panoply of weapons used to silence opposition and safeguard the Ngo hold on power.

By most accounts, security rather than democratic reforms motivated the Diem regime. The countryside teemed with opposition. Despite a variety of tactics aimed at destroying the insurgency, which Diem and others referred to derisively as the “Viet Cong,” it continued to grow among the general population, which both joined and sustained it. That insurgency grew out of a decades-old revolutionary movement spanning all of Vietnam that had defeated the French and now opposed the Americans and Diem. By late 1960, this revolution, led by the Vietminh, attracted thousands of insurgents from all over southern Vietnam and formed itself into the National Front for the Liberation of Vietnam (NLF). Hanoi provided formal recognition by the close of the year for its aggressive opposition to Diem’s rule. Additionally, a broad spectrum of workers, students, civil servants, and the military continued to oppose the government in a variety of ways.

Only weeks earlier, opposition reached crisis proportion as a coalition of military officers attempted a coup, and very nearly succeeded. Led by an elite parachute regiment and a marine battalion, in the early hours of November 11 the rebels stormed the presidential palace and took over army headquarters and the airport. As this fragile and divided coalition conferred about the composition of the new provisional government, Diem used phony concessions to stall for time. When loyal troops arrived the next day to surround the palace and its captors, the coup crumbled and its leaders fled to exile in Cambodia. On November 14, Diem announced, “The Government continues to serve the nation in accordance with republican and personalist principals” (Carter 2008, 110). The coup came and went quickly and seemingly without disturbing the balance of forces in Saigon. For the time being, Diem remained in power.

The coup did, however, expose an ominous trend. It revealed and even nurtured a politicized military, and it pitted that military against incompetent and, in many quarters, illegitimate political leadership. For the American mission, the event further divided Durbrow, who increasingly demanded reform, from now-retired MAAG chief Williams, who believed the ambassador had encouraged the plot or at least withheld wholehearted support for Diem in his hour of need. Diem clung to power in Saigon for the next several years, during which time the situation only worsened. The NLF gained more power, engaging increasingly in armed clashes with Diem’s forces. Insurgent guerrillas became ubiquitous in numerous villages and controlled large areas of rural Vietnam as peasant dissatisfaction with the regime, now referred to derisively as “My-Diem,” or America’s Diem, grew. The Ngo family maintained its intransigence and continued to aggressively squash dissent and opposition. The American mission shifted as well, as circumstances drifted toward open armed conflict and away from any real focus on economic development. Indeed, the events of 1958-1960 in Vietnam set in motion tensions and divisions over American policy that became deeply entrenched and significantly informed U.S. policy toward Vietnam for years to come.

Conclusion: A Crumbling Bastion in Southern Vietnam

From the late 1950s into the early 1960s, the Eisenhower administration increased its aid to the Saigon regime in part to encourage its development but largely to stave off collapse. In the process, policy makers, both American and Vietnamese, invented a Vietnam below the 17th parallel that required constant aid and support to survive. By 1960-1961, the state invented below the 17th parallel, to the extent that it existed at all, was not what planners imagined. The Diem regime required increasing military aid as the revolution in the countryside became better organized and expanded its resistance. All the while, the aid program designed to build a modern state infrastructure around Vietnamese leadership had grown exponentially, although not uniformly.

Nevertheless, even as contrary evidence piled up, Senator Mansfield and others continued to believe that the Vietnam the United States wanted to create below the 17th parallel could only be built around Ngo Dinh Diem. As the senator submitted his report after the congressional investigation, he was well aware that the regime in Saigon had earned the fear and hatred of many Vietnamese, and that, as far as some were concerned, the U.S. aid program made Diem’s authoritarian rule possible.

Formerly enthusiastic American nation builders closest to the project also voiced their own grave concerns that the effort had veered onto the wrong track. MSUG economic advisers Adrian Jaffe and Milton Taylor believed the American aid program had overemphasized military concerns and had made the economy dangerously dependent. The two published a 1961 article warning that the project to build the new state in southern Vietnam was doomed. The authors believed Washington had deluded itself and the American people by touting the success of the U.S. aid program for Vietnam. Far from being a success story, according to Jaffe and Taylor (1961), “Vietnam is not stable, not viable, not democratic, and not a bastion” of the “Free World,” as officials claimed. It was instead “a crumbling bastion” (17-20).

Other analyses found that of a population of more than 12 million, only about 15,000 paid any taxes. Of that number, approximately 12,500 were civil servants and military personnel. In short, the regime had little or no revenue-gathering capacity beyond American aid. The Commodity Import Program thwarted home production and the growth of manufactures as it continually expanded to meet inflationary pressures. This formula in southern Vietnam had mushroomed and become entrenched. The very structure of the program determined that the Americans could never cut it off and leave. These criticisms were sharply at odds with the more optimistic appraisals coming out of Washington. Not surprisingly, Diem rankled at such criticism and reacted strongly, expelling journalists, resisting reforms, and refusing audiences with key advisers. By 1962, Saigon leaders determined that they could afford to allow the MSUG contract to expire, and those advisers packed up and went home.

Over the course of these debates, hearings, and investigations the U.S. aid program for Vietnam hovered between $250 and $350 million annually. By 1961, total U.S. aid for the project climbed to $2.19 billion (Carter 2008). The massive and growing program in Vietnam could be either a showcase of U.S. Cold War state-building projects, or it could be an embarrassing failure. Some in Congress were keen to ensure the former.

This tendency to downplay or to conceal altogether the bad news or the ominous developments with the project became pervasive among American officials, both in Washington and Saigon. By the early 1960s, the U.S. aid program had nurtured the development of an utterly dependent regime. The point at which the Americans could have announced success, ended the aid program, and gone home continued to recede into the distance. Although those close to the project in Saigon and numerous others in Congress recognized this dilemma, they continued to limit their options as U.S. responsibility for the sustenance of the project expanded.

In that critical 1961 essay, advisers Jaffe and Taylor (1961) had already begun the now-familiar puzzling over how it all could have happened the way it did in Vietnam:

How was it possible for us to make so many mistakes, over so long a period of time? … We have sent to Vietnam, in large numbers, men of distinction in the academic and governmental world, professors and experts drawn from government agencies…. There have been few days when President Diem has not broken bread with at least one PhD and on good days, three or four. One of Diem’s personal advisers … is one of the world’s leading experts in the field of agricultural reform, and the Vice President of Vietnam is learning English at present from an American Chief of Mission. Another adviser, a political scientist with a PhD, has made some 22 trips to the Far East, and has written an article entitled “Vietnam’s Democratic One-Man Rule.” … But never in the history of our foreign affairs have we received more misinformation from a more qualified group (19).

Some of those experts and PhDs had, in the end, only limited influence. Many were surprised and disappointed to learn this. Despite their sober and earnest warnings, officials in Washington did not take heed, did not substantially shift course, and did not reform the aid program. Instead, they opted for greater levels of military force to provide security amid growing violence, instability, and resistance. That resistance coalesced late in 1960 as the NLF, in conjunction with Vietnamese above the 17th parallel, decided on overt, organized opposition to the U.S. effort and the American-backed regime in Saigon. Shortly after John F. Kennedy became president in early 1961, officials spoke of a “war” to be won in Vietnam. Meanwhile, that initial batch of advisers to Vietnam looked on from back in the United States as the nation-building effort gave way to open conflict and a set of military solutions to an array of nonmilitary problems. Shortly after numerous American advisers concluded that the project was hopelessly lost, military initiatives and open warfare supplanted nation building, and the successful creation of an independent South Vietnam receded further over the horizon.