"[A]mong nations suffering economic crises, we continue to hear calls for democracy and reform in many languages -- people's power, doi moi, reformasi." With that statement, Vice President Al Gore famously sparked an international diplomatic war of words at the APEC summit in Kuala Lumpur. Less remarked upon than his expression of support for political protestors in Malaysia was Gore's reference to the stagnating Vietnamese economic reform program dating to 1986. Neither American businessmen in Vietnam nor aspiring Vietnamese democrats could miss the irony of Gore's proposition that meaningful economic reforms, as signified by the doi moi reference, or the massive political upheaval he meant to invoke, as in the Philippines in 1986 or Indonesia in 1998, were taking place in Vietnam. Indeed, most observers single out Vietnam for its distinctive reluctance to pursue economic and political liberalization. Personally, I am skeptical about the Vietnamese leadership's willingness to implement some of the changes that are manifestly in their country's national interest. Nonetheless, my November 1998 trip to Hanoi left me guardedly optimistic about the potential for positive change within Vietnam and the future of U.S.-Vietnamese relations. American businessmen and investors in Vietnam cannot be blamed for questioning the continuing viability of their investments. Corruption, red tape, and bureaucratic inertia remain pervasive, as I never fail to remind the Vietnamese leaders with whom I meet, and as I myself am consistently reminded by U.S. business leaders in Vietnam. The latest Heritage Foundation/Wall Street Journal Index of Economic Freedom places Vietnam at the bottom of its "Repressed" economies category, in the unpleasant company of Somalia, Iraq, Libya, Cuba, and North Korea. Foreign investment in Vietnam declined by 40 percent in 1997 and 50 percent in 1998. Prime Minister Phan Van Khai speaks of the "need to maintain a leading role for the national state-owned enterprises," despite World Bank pressure for privatization. Few American businesses are earning a profit in Vietnam. Ironically, Vietnam's economic backwardness has allowed it to weather the financial crisis that devastated the more developed economies of Indonesia, Thailand, and South Korea. As Indonesia's economy shrank by 14 percent and record numbers of South Koreans lost their jobs, Vietnam's economic expansion slowed to a respectable 5.8 percent in 1998 after four years of growth averaging 9 percent annually. As in China, Vietnam's nonconvertible currency did not allow for the massive capital flight first seen in Thailand in 1997. In the wake of the financial crisis, Vietnam's leaders must resist drawing the conclusion that closed, non-market economies are comfortably immune from the pressures of globalization, or that economic openness invariably results in financial panic and macroeconomic destabilization. Vietnamese leaders, like their Chinese counterparts, must recognize that the Asian contagion, while financially painful and socially destabilizing, has effectively forced upon its victims the institutional reforms that should help build the kind of free, transparent, appropriately regulated, law-based economies so attractive to foreign investors. Although it was somewhat sheltered from the economic storm, I believe Vietnam, like China, must now freely adopt reforms its wealthier neighbors are already implementing in order to advance to the next level of prosperity. Not to do so will doom Vietnam to remain an impoverished, rural-based economy well into the new century, a fate unworthy of its people and inimical to its leaders' interest in demonstrating the continuing benefits of their rule. Conventional wisdom has it that Vietnam's leadership is so obsessed with social and political stability that even modest economic reform proposals generate intense debate within the Politburo. I know conservatives like Communist Party General Secretary Le Kha Phieu and his influential predecessor, Do Muoi, to be cautious individuals without discernible reformist impulses. The ambitions of reformers are held in check by their superiors on the Central Committee. A new generation of leaders in Hanoi remains under the influence of the war-era Old Guard. If they insist on rejecting well-intentioned advice from Western donors to liberalize their economy, Vietnam's leadership should look north, where Chinese Premier Zhu Rongji is implementing an ambitious reform agenda that includes restructuring a dangerously indebted banking system, closing unprofitable state-owned enterprises, ending the military's commercial activities, and putting in place the rudiments of a social safety net. Like Vietnam, China may find itself overwhelmed by political unrest if the remaining legitimacy of Communist Party rule is undermined by widespread economic hardship. Unlike their Vietnamese counterparts, China's leaders have accepted that dramatically freeing up markets and reducing the role of the state is the best means of sustaining economic growth, a pillar of social stability. The Vietnamese leadership, haunted by grassroots protests over taxation and corruption in Thai Binh province in 1997 and 1998, must recognize sooner or later that its statist economic policies do not fully address the needs or the grievances of the Vietnamese people, who remain among the poorest on Earth. That Beijing, which once represented the vanguard of Asian communism and remains hostile to political reform, is adopting painful free-market reforms and prosecuting corrupt senior officials with an unprecedented sense of urgency should serve as a reminder to Hanoi that times have changed. Times have changed indeed. The United States and Vietnam have gingerly undertaken several high-level military-to-military exchanges, setting the stage for future cooperation on security challenges in Southeast Asia. Admiral Joseph Prueher, America's recently departed senior officer in the Pacific theater, has visited Vietnam, and Vietnamese military officials, including the Vice Minister of Defense, have visited the United States. Defense Secretary William Cohen has been formally invited to Vietnam and will likely travel to Hanoi this year. The Vietnamese are, understandably, somewhat cautious about the pace of high-level defense exchanges, but they seem to accept that both nations stand to benefit from this budding military-to-military relationship. In the U.S. Congress, legislation relating to Vietnam remains contentious, but the balance of opinion continues to shift in favor of closer U.S.-Vietnam ties. In 1998, I joined Senator John Kerry in opposition to legislation to overturn the President's decision to waive the Jackson-Vanik amendment for Vietnam. Congress ultimately endorsed the waiver, which permits the Overseas Private Investment Corporation and the Export-Import Bank to support U.S. business in Vietnam. Senator Kerry and I also successfully removed from an appropriations bill language that would have tied the release of funding for American diplomatic facilities in Vietnam to burdensome and unreasonable reporting requirements regarding Vietnamese cooperation in the search for our missing service members. The vote to remove the onerous provision, like the earlier Congressional vote to uphold the Jackson-Vanik waiver, implicitly endorsed closer U.S.-Vietnam ties. The United States and Vietnam are currently negotiating the terms of a bilateral trade agreement. Negotiations have dragged on for several years, but significant progress has recently been reported. Some experts and officials expect an agreement to be reached this summer, allowing for its submission to Congress for approval before the year 2000, when the Congressional and Presidential campaigns will make consideration of trade agreements extremely difficult. Congressional approval of a bilateral trade agreement would grant Normal Trade Relation status to Vietnam and open the way to Commodity Credit Corporation support for U.S. trade with Vietnam, designation of Generalized System of Preference status to Vietnamese imports, and increased levels of U.S. bilateral assistance. Clearly, these programs would benefit Vietnam and the American businesses operating there. Obstacles still stand in the way of closer U.S.-Vietnam ties. Some critics maintain that by "rewarding" Vietnam with trade and diplomatic benefits, we provide Hanoi little incentive to help us locate our missing service members. Moreover, human rights abuses continue, despite the welcome release of political detainees in September 1998, including prominent dissidents Doan Viet Hoat and Nguyen Dan Que. I continue to support closer U.S. relations with Vietnam for the reasons that motivated my advocacy of normalized trade and diplomatic ties in 1994 and 1995. Vietnamese cooperation on POW/MIA accounting has been excellent since we normalized relations, according to the American military teams working on the ground in Vietnam. Vietnamese cooperation on refugee resettlement has also improved substantially. Vietnam has not done enough to safeguard the human rights and religious freedom of its citizens but can hopefully be encouraged to do more. America's strategic interests in Southeast Asia are served by closer diplomatic and military ties with Vietnam. Recent unrest in Indonesia and Chinese activities in the South China Sea are useful reminders that American security interests in Asia could be threatened at any time, and that our military and diplomatic relationships with countries in the region remain valuable. It is my hope that Vietnam will continue to engage overseas while undertaking the economic and political reforms required for stability and prosperity at home. Simplifying investment regulations, privatizing state-owned enterprises, reducing trade barriers, and implementing legal reforms to safeguard private property and uphold individual rights are absolutely necessary. Political reform is also important. Some believe that the political status quo is itself destabilizing. As Doan Viet Hoat, a man I admire and respect, said in a recent interview with Asiaweek: "If the Party doesn't accept democratization, violence will break out and we will have chaos after the communist regime is overthrown. No one wants that." Let us hope Vietnam's leaders accept the reasonable premise that only with the support of the Vietnamese people will their rule advance the common interest in a stable, open, prosperous Vietnam.