Conflict in Asia

• When analysing markets, a range of assumptions are made about the rationality of economic agents involved in the transactions
• The Wealth of Nations was written

  1776
• Rational

  (in classical economic theory) economic agents are able to consider the outcome of their choices and recognise the net benefits of each one
• Producers act rationally by

  Selling goods/services in a way that maximises their profits
• Workers act rationally by

  Balancing welfare at work with consideration of both pay and benefits
• Governments act rationally by

  Placing the interests of the people they serve first in order to maximise their welfare
• Rationality in classical economic theory is a flawed assumption as people usually don't act rationally
• Marginal utility

  The additional utility (satisfaction) gained from the consumption of an additional product
• If you add up marginal utility for each unit you get total utility
• Dien Bien Phu, 1954, and its consequences
• The French lost 3000 dead in the battle and 8000 more died in captivity. The Viet Minh forces had defeated the French in open battle with the help of modern weapons from the USSR and China. A small Asian state had defeated a rich European state through a combination of effective leadership, the right tactics and sheer domination.
• At the 1954 peace Conference, the country was effectively divided into North and South Vietnam until elections could be held to decide its future.
• May 1954 Britain, France, China, the USSR, the USA and Vietnam met in Geneva. They were to decide the future of Vietnam and a settlement for the who of Indo-China.
• They agreed: French troops to withdraw, a ceasefire and a new territorial settlement. Laos and Cambodia were formed, North and South Vietnam were created (although it was intended to be temporary). Vietnam divided along 17th parallel. North =communist. South = Anti-communist

  
• Under the terms of the cease fire, elections were to be held within two years to reunite the country.
• However the USA prevented the elections from taking place because it feared that the Communists would win.
• President Eisenhower was convinced that China and the USSR were planning to spread Communism throughout Asia. The idea was often referred to as the Domino Theory. – If Vietnam fell to Communism, then other Asian countries might also – like a row of dominoes. The USA saw Vietnam first in the line of the dominoes and was determined not to let it fall. 1964 USA committed to protecting South Vietnam – threat from North Vietnam (Vietminh) and communists in south (Vietcong)

  
• Domino Theory

  If Vietnam fell to Communism, then other Asian countries might also – like a row of dominoes
• New countries formed in the Geneva Agreement: Laos and Cambodia
• The defeat of France was unexpected because a small Asian state had defeated a rich European state through a combination of effective leadership, the right tactics and sheer domination.
• Vietnam was divided into North (communist) and South (anti-communist) along the 17th parallel, although it was intended to be temporary until elections could reunite the country.
• No unification election was held because the USA prevented it, fearing the communists would win.
• A non-Communist government was set up in South Vietnam under President Diem. However, his rule was harsh, corrupt, and unpopular. Enemies were imprisoned. Money was wasted or Spent on defence.
• Diem was a Catholic and the government persecuted the Buddhist majority. Monks protested about the lack of religious toleration, in extreme case by setting fire to themselves. In spite of this, Diem received the support of the US government—simply because he was anti-Communist.
• Ho Chi Minh was a popular leader. His mission was to unify Vietnam. In 1960 the NLF (National Liberation Front) was formed, with the task of unifying the country. Diem called the members of the NLF the Vietnamese Communists (Viet Cong). The NLF demanded the removal of Diem and began a campaign of Guerrilla Warfare. By 1961 there were over 20,000 Viet Cong Guerrillas in South Vietnam.

  
• The NLF was a guerrilla movement trained in conducting ambushes and it had support in the North and South of Vietnam. The Viet Cong lay traps, and used cover of the jungle in their surprise attacks. They were supplied through the Ho Chi Minh Trail, created in 1959 to carry supplies from the North to the South. The trail was made up of 100s of interlocking trails that all led from the North to the South, some passing through Laos and Cambodia, walking along it could take up to two months.
• In South Vietnam the Viet Cong gained support from the local population and in the early 1960s, with over 100,000 troops, the Viet Cong controlled many parts.
• Diem had become increasingly unpopular in the south and in 1963 was killed by his own troops. 10 different governments ruled over the next 2 years.
• The NLF / Viet Cong hoped to achieve the unification of Vietnam.
• The people of South Vietnam did not like the rule of the government, as evidenced by the protests of the Buddhist majority against the persecution by Diem's Catholic government.
• The USA provided aid to South Vietnam; $1.6 billion between 1954 and 1960. Military advisers were also sent. By 1962 there were 11,000 providing training.

  
• The Strategic Hamlets programme, which moved peasant villages from Viet Cong controlled areas to areas controlled by the South Vietnamese government, further converted many to Viet Cong sympathisers as the villagers resented working without pay to build defences and the corrupt officials who took the money meant for social benefits.
• In August 1964, North Vietnamese patrol boats opened fire on the US ships in the Gulf of Tonkin. The US congress passed the Tonkin Gulf Resolution, it gave Johnson the power to 'take all necessary measure to prevent further aggression and achieve peace and security'. It effectively allowed the USA into full-scale war.

  
• Following further Viet Cong attacks in 1965, Johnson approved a massive bombing campaign in February against North Vietnam called Operation Rolling Thunder. 8th March, 35,000 US marines came ashore at Da Nang.

  
• In early 1965 the NVA (north Vietnamese army and the Viet Cong had approximately 170,000 soldiers. Weapons and equipment were supplied from China and the USSR, but the South Vietnamese and US forces outnumbered and outgunned them.

  
• The Vietcong used guerrilla tactics to avoid a pitched battle with the enemy, as they could never hope to defeat the might of US forces in a battle. They relied on the support of the local people to hide them, provide food and shelter.
• The Vietcong hoped to wear down the Americans and destroy their morale in fighting an enemy that they could not see, which would allow the Vietcong to take control of areas where the Americans were stronger.

  
• The Vietcong were recruited mainly from men and women who lived in South Vietnam, and some recruits came from North Vietnam. They lived and worked in the villages and became part of the village.
• The Vietcong had a code of conduct to ensure the villagers were treated with respect, including being polite, fair, not damaging crops, and not flirting with women.
• The Vietcong would target unpopular officials of the South Vietnam government and kidnap and murder them to persuade villagers to join them. They were prepared to kill any peasants that opposed them, and 27,000 civilians were killed by the Viet Cong between 1966-71.