In Vietnam, Message of Equality Is Challenged by Widening Wealth Gap

Thomas Fuller       
September 1, 2012


HANOI, Vietnam — She wore a pink outfit and matching high heels as she toured the dusty construction site. Soon after To Linh Huong’s visit in April, photos that captured the moment went viral on the Internet, but not because of Ms. Huong’s sense of style.

To Linh Huong, the daughter of a member of the Vietnamese Communist Party’s Politburo, in April, days after she had been appointed the head of a state-run construction company.

The daughter of a member of the Vietnamese Communist Party’s Politburo, the country’s most powerful political body, Ms. Huong had only days before been appointed the head of a state-owned construction company. Commentators on the Internet expressed outrage that someone so young — she is reported to be 24 — held such a senior corporate post.

“Taking a little girl who just graduated from journalism school and making her the director general of a construction company is no different than making a one-legged man a soccer goalie,” read a comment on Pham Viet Dao, a popular blog by a Vietnamese writer of the same name. “Sorry to say — this is so stupid.”

Like the Communist Party leaders in China, Vietnam’s political mandarins are struggling to reconcile their party’s message of social justice and equality with the realities of an elite awash in wealth and privilege. The yawning divide between rural poverty and urban wealth has become especially jarring, now that a decade of breakneck growth has come to an end, dimming the prospects for the poor and middle class to fight their way up the social ladder.

“Up until now, growth has been wonderful, and to be rich was great,” said Carlyle A. Thayer, a leading expert on Vietnamese politics who has a database of Vietnamese leaders and their family members. “There’s a growing resentment, particularly among the have-nots, toward the wealthy.”

Much of the ire has been focused on Vietnam’s version of crony capitalism — the close links between tycoons and top Communist Party officials. This criticism has been able to flourish partly because news of abuses has leaked out as state companies, which remain a central part of the economy, have floundered, helping precipitate Vietnam’s serious financial woes. Activists and critics have also been able to use the anonymity of the Web to skirt tight media controls that had kept many scandals out of public view.

As criticism has mounted, some of the relatives of Communist Party officials have stepped back from high profile roles.
Ms. Huong left her state-run company in June, three months after her appointment, and the daughter of the prime minister recently left one of her posts, at a private bank.

Government officials, meanwhile, are sounding defensive.

Vietnam’s president, Truong Tan Sang, issued a blunt self-criticism in a recent article in the state-run media, writing about the “failures and ineffectiveness of state-owned companies, the decay of political ideology and morality.” He also blamed the “lifestyle of a group of party members and officials” for the country’s problems.

“We should be proud about what we have done,” he wrote, speaking of the economic boom under Communist leadership, “but in the eyes of our ancestors, we should also feel ashamed for our weakness and failures, which have been preventing the growth of the nation.”
On the Internet and social networks, much of the anger about nepotism and poor economic management has been directed at Prime Minister Nguyen Tan Dung, who was re-elected to a five-year term last year amid the turmoil of failing state-owned companies.
“People are concerned that he has too much power — they feel he needs to be reined in,” said Mr. Thayer, who is emeritus professor at the University of New South Wales in Canberra, Australia.

Mr. Dung’s family was the focus of a diplomatic cable in 2006, the year he became prime minister, written by Seth Winnick, who at the time was United States consul general in Ho Chi Minh City.

The cable, made public through WikiLeaks, highlighted the corporate career of Nguyen Thanh Phuong, the prime minister’s daughter. “There is no doubt that she is talented,” Mr. Winnick wrote. “However, her rapid advance, and the many doors that opened for her and her two brothers are indicative of how the Vietnamese political elite ensures that their progeny are well placed educationally, politically and economically.”

Although her work was in the private sector, the cable noted how public and private tend to overlap in Vietnam, with its hybrid system of Communist one-party rule and burgeoning capitalism.

Ms. Phuong runs an investment fund called Viet Capital Asset Management and a brokerage firm, Viet Capital Securities, both private companies. In June, amid criticism on the Internet of her wealth and influence, she stepped down as chairwoman of Viet Capital Bank, a position she had held for four months.

While Ms. Phuong is among the better known of the so-called “children of the powerful,” the list is long. It includes her brother, who is the deputy construction minister, and Ms. Huong, the young woman who headed the construction company and is the daughter of To Huy Rua, a powerful member of the Politburo. Others have moved up in the party. The son of Nong Duc Manh, who retired as general secretary of the Communist Party last year, is a member of the party’s Central Committee.

Because of tight controls on the media — and severe punishment for dissent that can include jail terms — criticism of the leadership has been largely anonymous, on blogs and Facebook pages, often driven by rumors and unsubstantiated gossip. But as state-owned companies struggle with scandals and mountains of debt, details of nepotism and shady dealings have also slipped into the public domain.

In reporting the collapse of one of the largest state-owned conglomerates, Vinashin, the state-run news media revealed that at least three family members of the company’s chairman, Pham Thanh Binh, held senior positions in the company, including his son and brother.
The total cost of these scandals to Vietnamese society remains unknown. But the billions of dollars in debt are likely to be a huge burden for the economy for years to come.

Given Vietnam’s history of revolt, it is perhaps fitting that many of the bitter comments online about the scandals have often been accompanied by an ancient Vietnamese poem taught to schoolchildren:

The son of a king will become king
The son of a temple janitor will sweep the leaves
When the people rise up and take over
The son of a king will lose power and sweep the temple.