Gordon Gekko Nguyen?

Remember Gordon Gekko, the Michael Douglas character in Oliver Stone’s Wall Street? He’s the one who proclaimed that “greed is good” at a shareholder meeting. Wall Street hasn’t changed much since the 1987 film. Those nice folks who brought you the sub-prime housing crisis, the Great Recession, the too big to fail bailouts, and the obscene bonuses are still bilking all of us. America is still run by the fat cats and special interests. So is Vietnam and cynically “greed is good” could also be the national tagline in Vietnam. The cynical view doesn’t take into account the incredible industry of the people, their positive outlook on life, or their willingness to sacrifice their own welfare for the welfare and education of their children. But, greed and corruption are huge problems in the country and in some ways seem to be driving the culture. It used to be unmentionable but recently it’s more and more a topic of concern and conversation along with the Bo Xilai corruption scandal in China.

Every economist who discusses the business forecast for Vietnam mentions corruption and infrastructure as two of the major obstacles to growth. They go hand in hand. Every major construction project is fraught with corruption from the permitting process to the substitution of materials. Everyone takes a piece of the pie and the final product is often delayed and inferior. In 2007 we rode our bicycles from Saigon to Hanoi. There was one national highway, Highway 1, connecting the two largest cities in the country. Most of the way it is two lanes and all of the commerce north and south takes place on it. In 2005 Sandy Northrop, an American journalist and filmmaker, released a three part video series on Vietnam and Part One included a report on a second highway being built to handle north south traffic. Sandy’s video said the new highway would be completed by 2007. It is now 2012 and I haven’t heard or seen anything about the second highway in the last three years. My guess is that it has become so costly because of corruption that it’s completely stalled and may not make sense any more.

I have an Australian friend who runs a logistics company that moves freight around the country. He told me that his company has a line item, a big line item, in its budget for bribes his drivers have to pay in order to get from A to B on the highway. Another friend in the know told me that the police have to pay the government to get exclusive rights to a section of Highway 1. The buy-in is three years salary but the payoff is enormous. Every time he stops a truck he gets 500,000VND ($25USD). An average day or night is worth about $800USD, and that’s just for his section of the highway. The driver has to travel 1500 miles. Imagine.

I had dinner at a British friend’s house last year and he pointed out the houses on either side of his in an exclusive gated compound in District 2. His neighbors, he also pointed out, were both local police officers. Real estate in this neighborhood is not cheap. Most of the villas in the compound are in the million dollar range. Not easy on a government salary of $300-500 a month.

On the local level, it’s fascinating to watch what happens when a policeman pulls over a motorbike. There is a short conversation. I’m imagining a lecture on safe driving or mechanical soundness. Then the officer asks for the driver’s papers which are tendered but include 200,000VND neatly folded between the pages. The papers are scrutinized and returned with a stern warning and both drive off. Transaction complete.

My own experience is limited, but on returning to Vietnam last month I had a small visa problem. Mine was issued in San Francisco with the wrong expiration date, a date that was earlier than my intended return date. I had a copy of the email with the correct dates and was told by the Vietnamese consulate in San Francisco that with my email confirmation it would be corrected on arrival in Saigon. It was corrected but not before the first immigration officer asked me for $50 to fix it. I pointed out that I had already paid for the visa and that the consulate had made the mistake. He did not have the stamp to make the official change, so he reluctantly took me over to another immigration line where I was told it could be done for $10. I saw the handwriting, so to speak, and rather than wait an hour for the process to work I handed over the $10 in order to speed the process up. No receipt was given but I did get the visa fixed and went on my merry way.

It’s easy to get discouraged, and doing business in Vietnam can be a sordid affair. On the other hand, America has a formalized and codified brand of corruption. It’s called lobbying and it’s corrupting Congress and preventing the legislative branch of government from acting in the national interest. If 75% of Americans believe we should have universal health care and that banks should be closely regulated to prevent another financial crisis how can we explain to to the world that Republicans are vowing to repeal the healthcare law and stonewall financial reform if they win in November? Are those things in the national interest? I have a hard time seeing how either America or Vietnam are going to fix themselves, but I think I have more confidence that Vietnam can do it than I think America can. How’s that for the cynical view?

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