The Mayor of London is an old Etonian. The next British Prime Minister will be too.

The last president of the United States was the son of a former president.

The current secretary of state in the US is the wife of a former president.

Try looking at all those in power, or recently out of it, linked to the Carlyle Group and see all the strings they are pulling and the millions they are making. These even includes such talentless individuals as John Major.

And so it goes around. And it's always gone around.

It's not ideal in the West or the East. But you can't bash a country over the head for decades for being Communist and then tut tut them when they start to behave like capitalists.

"The biggest state corporations are setting up unaccountable funding channels to finance projects with minimal economic logic" Sounds like our " Too big to fail friends" in Wall Street. At least the Vietnamese Government may be able to stand up to its financial sector before it creates a disaster. No chance of that happening in US, especially now that the Supreme Court is allowing corporations to spend as much as they want to buy the candidates of their choice. Vietnam may become a model of fiscal discipline in comparison to US.

After 20 years of destroying the economy and impovershing their people, the younger generations of Vietnam's communist party started about 15 years ago in attempting to grow the economy on quasi-capitalist lines. The crucial ingredient for sucess in this new environment is not talent or capital, but a close relationship to the ruling elite. The Vietnam model is developing into a version of the crony capitalism that has existed for years in South East Asia and is currently dominant in China.

The trouble with crony capitalism isn't that it is all bad -- it will certainly provide better economic growth than the socialist model. However, over time the State will have to assert more and more control over the economy, and use their power to jail any independent entreprenuers who show signs of having too much independence. Again, this is what is happening in China, which has quite a head start on this pattern of development.

Eventually, however, growth will slow as the advantages of Vietnam -- mostly, a low cost of labor and a young population -- are offset by an increased cost of production, lack of internal markets, poor educational system, and the general inefficiency and corruption of the country, not least in the government. Vietnam will get caught in the middle-income country trap -- manufacturing low cost goods for export, a fair number of well-connected rich, a somewhat insecure middle and professional class (both classes will hedge their bets by securing foreign passports) and a large working class with increased ecomic and social aspirations. Again, lives will be overall much better than they were under the socialist model, but growth in a closed society is bound to be limited and hindered. Over time, the government will renew its focus on mainining power, even at the expense of the economy.

Crony capitalism is not the worst system, but for long run growth, an economy needs to be fairly open and fairly democratic, especially if it is ever going to develop a first world standard of living. Neither Vietnam nor China show any sign of making this further necessary leap; it is probably too much to hope that the governments in question will respond with more openess rather than increased repression. So the question is not whether or not a crackdown is coming, but how soon and how bad -- and how successful -- the crackdown will be.

Actually, I am writing a term paper about this and found that most of the information stated here are similar to my findings! Thanks for the share! This will be a big help for my paper.

Despite condemning the recent arrest of dozens of pro-democracy activists,
the US still plans to move ahead with its agenda to increase trade with Vietnam via the Trans-Pacific Partnership and has no intent on dealing with the human rights issues at stake. Democracy is not just a moral tenet, it is a component of a stable investment climate, efficient work force, and future growth. With Vietnam as the United States’ 38th largest goods trading partner with $15.7 billion in total (two ways) goods trade during 2008, we should be demanding more accountability behalf our trading partners. As free trade agreements proliferate, governments should use these instruments as economic incentive tools to push for democratic institution building in lesser developed countries. It is time for the United States to embrace its responsibility from both an economic and moral perspective to demand more from the Vietnamese government.

Nicole Skibola, www.rightrespect.com

Hi Bill,

I know the a few people mentioned in your article and the situation in Vietnam as well as the situation in China and Russia, but don't see the outcome you are predicting yet.

The Communist Party of Vietnam is too powerful and can use their iron fists to make sure things are in line with their vision.

The latest conviction is to scare the hell out of the opposition appealing for justice and less corruption and they can repeat it again in the future if needed. It was not about punishing their own ranks crossing the line.

Party Members send their kids to the US for education and those kids will come back and govern this country as the new crony capitalists in the name of the people and socialism.

The country may slow down in its development but the elite ruling members will enjoy more wealth for many year to come.

Thank you for sharing this information. It should really help me to write a perfect cheap essay for my friend.