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8/2/1965 - The Rice Tangle by Takashi Oka

INSTITUTE OF CURRENT WORLD AFFAIRS NOT FOR PUBLICATION TO The Rice Tangle P O Box Salgon Vietnam August Mr Richard H Nolte Institute Current World Affairs Madison Avenue New York N Y Dear Mr Nolte South Vietnam short Several times United States emergency imports By total emergency reach This alarming statistic Before World War II Vietnam export million almost Mekon River delta south Of Saion Even today citizen Saigon finds difficult believe cannot would The Communist offensive hittln places where hurts purse stomach In Saion today kilogram quality costs piastres about cents compared eight piastres A cheaper plastres government licensed shops presents family willing queue hours But obtain kilos quality great broken At Chaudoc western delta costs seven plastres The reason longer freely barge western producing areas capital But statement oversimplification actually fascinatingly complicated tangle The Communists principal element disruptin normal movement If there Communists stepped their military economic offensive Saigon citizens would complaining about price about alleged quality imported American Each Asian people dislikes grown elsewhere unless happens At greed speculators hoarders mismanagement corruption government military officials callous attitudes shown overnment officials Communist cadres towards peasant produces compounded problem Traditionally trade South Vietnam hands Chinese dealers based Cholon almost wholly Chinese which forms Salgon administratively There these dealers network agents covering Mekon8 delta The Vietnamese Mekong Cuu Lons Nine Dragons because mouths Each dragons waters enriches luxuriously green smiling plain crisscrossed canals which built nineteenth century Vietnamese emperors others recently French The delta still relatively uncrowded plenty reclaimable marshes drained canals opened Here isurely colonial before World War II handful baronial Vietnamese French landlords commuted between their plantations their residences Saion Cap St Jacques Dalat Here lesser peasants tenants least enoush their stomachs unlike impoverished cultivators handkerchief slzed plots north central Vietnam I Vietnamese friend whose mother owned hectares acres choice paddies islands between Nine Dragons And 5randmother owned hectares boasts To operating costs large plantation money tenants before harvest friend mother borrowed money resularly Chinese dealer And dealer would It rhetorical question throushyears experience could calculate almost twenty kilograms paddy unmilled Madame Xuan fields would produce Madame Xuan would straight point I piastres until harvest would Certainly certainly I charge interest dealer would respond But promise harvest price would figures calculated basis production estimates market prices export outlook No documents would exchanged between Their their ibond The dealer would return Saigon apply immediately Baque Indochine credit piastres Each Chinese Vietnam belonss French called congregations communities based China which ancestors emigrated The dealer originally Swatow would leader TO congregation If leder vouched would Ive credit without furthe formalities Within hours would Madame Xuan requested plastres Few landowners wealthy Madame Xuan Chinese merchant dealt large small With small landlords owner peasants dealers representative Can Tho other convenient provincial capital would rounds In either dealer agent acted banker andas purchaser producers Mekon delta Once bought paddy would bares delta Saigon where would milled consumption transshipment deficit areas Indochlna export World War II disrupted pattern Indochina continued dislocation Many landlords captured Communists denounced meetings beheaded buried alive Others provincial capitals Saion After peace restored Vietnam divided between Communist North South No Dinh Diem regime South proclaimed reform under which individual landholdings restricted hectares It fixed ceiling percent harvest Survivin landlords livin secure areas around restrictions dividin their members family But mammoth landowner finished The individual peasant squeezed landlord before combination landlord Chinese dealer supplied essential credit To overnment created cooperatives National Arlcultural Credit Office Rice production South Vietnam slowly recovered during years relative peace Even after Communists began their armed insurgency interfere establlshed pattern trade They however require dealers euphemistically calle circulation transported Slowly production returned prewar levels because increased populatlon exports never exceeded Still rubber mainstay South Vietnam exports Even country exported In figure sharply reduced partly because increased Communist activity partly because disastrous floods Central Vietnam In normal times government tries stock O00 warehouses Saigon It purchases Chinese dealers under contracts negotiated Saigon happens boundary between surplus deficit areas South Vietnam The Mekon8 delta south producin East north forests rubber plantations these import Central Vietnam former Annam narrow valleys coastal plains between mountains marching Densely populated import The government estimates consumed Saigon month In addition month shipped deficit areas Thus O00 reserve little months supply purposes With reserve emergencies excessive fluctuation prices Normally cheap producin areas cities Just after harvest This peasants greater their harvest Prices gradually reach their summer before harvest comes A consumer piastres winter expect around eight plastres summer As peasant around plastres twenty kilograms paddy harvest He retains around summer seventy eighty piastres This December December AEriculture Ministry estimated would about This meant there should enough South Vietnam normal needs harvested could collected shipped Saigon usual The floods Central Vietnam forced government O00 stock The Communists stepped their military pressure Central Vietnam delta Both American Vietnamese officials feared Communists might attempt disrupt movements every collection shipment Saigon shipment Saion The overnment requested United States approved emergenoy llotment Amemican under Public Law Twenty thousand arrlved February allocated Mini Defense This enough armed forces seven months As O00 reserve remained unreplenlshed At point February South Vietnam through frequent changes government Dr Phan Huy Quat became premier appointed Professor Nguyen Van Vinh Economics Minister Professor Vinh Roman Catholic degree Louvaln University But incompetent economics Dr Quat later agreed appointment disaster For complicated political reasons Dr Quat unable Mr Vinh The EcOnomics Ministry remained rudderless February until Quat cabinet June caused Dr Quat efforts disembarrass himself Mr Vinh TO The Communists increased their circulation dealers three plastres January piastres February eleven piastres March In July overnment urces estimated circulation remained eleven twelve piastres This naturally increased shipment costs dealer At dealer offerin peasants approximately sixty plastres paddy The peasant little The Communists offering plastres As government sources story Communists peasants forty percent their The remaining sixty percent peasants For portion Communists offered plastres Most peasants areas controlled Communists government former night latter Chinese dealers being polltlcal usually these areas Being political drive hardest bargain whomever paying bribes taxes whomever Since dealer usually taxes bribes government officials civil military taxes probably bribes Communists profit margin buying heaply possible peasant selling possible consumer As explained before government attempts runaway appetite profits manipulatln reserve stock But under Mr Vinh disastrous policy rather pollcy government steps replenish depleted reserve In Mr Vinh allowed reserve until office June there nothing Under these conditions wholesale price which plastres kilos December climbed steeply plastres military government Brigadier General Nguyen Cao Ky installed June The Economics Ministry headed Truon Thai Ton immediate steps remedy situation The first psychological campaign dealers whose prices Eovernment completely allowin increased Communist taxes actual stoppage destruction barges comin Saigon The assistant province chief An GianE recently whereas barges voyages month Lone Xuyen province capital Salgon twice Merchants repeatedly asked armed escorts bares General Ky announced tough policy against hoarders speculators black marketeers He threatened drastic flnes prison sentences execution those convicted economlc crimes He proclaimed decree enabling government confiscate official prices Simultaneously Economics Ministry known negotiating imports United States With Thailand The remaining promised United States arrive July Using foreign exchange reserves government arranged Thailand standby basis Thai expensive similar Vietnamese In addition could delivered Saigon within three weeks Despite these psychological preparations officials began negotiating dealers SaiEon found dealers bring prices The dealers proposed government plastres The 5overnment The dealers Again government refused The dealers asked government price The government would In horror dealers piastres themselves government would business The government replied official price plastres twenty plastres cheaper government offering dealers It clear could Confiscate dealers stocks official price chose It suggested current season nearly dealers already handsome profits losses their books would balance Grudgingly dealers agreed supply government during July under Contract D As these negotiations 6overnment asked dealers declare their stocks The dealers reported Saigon The sovernment Take If false declaration prosecuted Thanks threatening gestures already announced General Ky dealers cameu figure Meanwhile General Quang commander Fourth Corps which covers Mekong delta promised collect deliver Saigon This meant government could count during July At month American would arrlve The prospect August modest Perhaps another could obtained delta With July should enough month As September United States being asked supply since there would prospect obtaining before December harvest Another would needed October November bringing total U S TO These frankly emergency measures which 6overnment hoped squeeze through As cominz hopes dependent Saigon dealers It plans system whereby peasants local dealers directly overnment provinces It plans reinforce exlstin agricultural cooperatives strensthen their credit functions played landlords dealers It plans group smaller dealers toether private corporation which compete dealers Finally plans Office Rice problem aspects Numerous problems remain ironed future implementing present programs For instance order collect promised Saigon General proclaimed official price plastres paddy He ordered peasants needed their surplus He ordered field collect But actual collecting dealers government Theoretically peasant refuses dealer piastres dealer In practice dealer knows risking He himself politlcal merchant taxes tection money Communists Eovernment officials alike He dealing peasants since before Communist insurgency began He expects continue after He haggle prices peasants because expect But collect forcibly would dealer agent Eovernment His relative immunity Vietconz retribution would vanish As peasant sorts excuses selling plastre price On black market bein5 plastres Why should reduce prices order inflation distant What government should demand sacrifice Thus reasons This sltuatlonshould Communists plenty rievances exploit But adopting predatorY itude towards peasant They still remember better government Mac Tse dictum peasants water which guerrilla But Mac nothin about shall waters South Vietnam resemble sharks It fairly established Communists offer peasants plastres At first peasants delighted But shifted Liberation Front bonds Knowin Saion dealers squeezed peasants Why Communists They proceeded drive skinflint baraln knowin Communists provided competition The Communists would better continued rather bonds offerln prices slightly higher dealers currently offering Durlnz western delta I talked villages district towns peasants government officials Everyone wanted higher price least seventy seventy piastres instead Even government officials conceded practice forcible collections served punitive measures against areas completely under Vietcong control If carried government c0ntrolled areas collections would alienate peasantry But higher prices producer combined lower prices consumer intelligent coordinated overall policy The government taking steps direction urgent Communists continue their disruptive tactics there great pressure ernment almost exclusively military counter measures Military doctrine tends portray contest between government Communist forces terms securing peasant rather allegiance during Ind ochlna remains today Each harvest season Communists government sanguinary battles secure larger share harvest To extent government forces harvest Communists extent consider themselves successful Military doctrine cannot totally ignored But easier implement patient institution building efforts undertaken range coordinated policy Here almost every other field In Vietnam tragedy exigencies immediate situation urged excuses cominz grips neglected needs Sincerely yours Received New York August