{"id":727,"date":"2026-08-27T20:39:32","date_gmt":"2026-08-27T20:39:32","guid":{"rendered":"https:\/\/frontierhousingreport.com\/?p=727"},"modified":"2026-08-27T20:39:32","modified_gmt":"2026-08-27T20:39:32","slug":"why-are-we-and-were-we-in-vietnam","status":"publish","type":"post","link":"https:\/\/frontierhousingreport.com\/?p=727","title":{"rendered":"Why Are We (and Were We) in Vietnam?"},"content":{"rendered":"
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Amid all the consequences of Donald Trump\u2019s impulse-driven trade wars; amid all the inflows and outflows of goods and services, capital and labor, one new statistic has arrested my attention: The nation which currently has the largest trade surplus with the United States isn\u2019t China or Taiwan or Mexico or any of the usual suspects.<\/p>\n

Read more Anthropic (Re-)Enlists for War<\/a><\/p>\n

It\u2019s Vietnam.<\/p>\n

In the first six months of this year, the value of goods made in Vietnam and imported to the U.S. exceeded the value of U.S.-made goods and services exported to Vietnam by $114 billion\u2014more than the surplus of any other nation.<\/p>\n

More from Harold Meyerson<\/strong><\/em><\/p>\n

That\u2019s partly the result, of course, of Trump\u2019s tariffs on China, whose rate was 23.2 percent in June, compared to the rate on Vietnam, which was 6.5 percent in June. (These figures come from the Penn Wharton Budget Model.) It\u2019s partly the result of the low-wage Vietnamese not constituting much of a consumer market: While Vietnamese exports to the U.S. came to $123 billion from January through June, American exports to Vietnam came to just $9 billion. It\u2019s partly the result of Vietnam\u2019s proximity to China, which made it a handy place for such American corporations as Nike and Lululemon, not to mention Apple (the flagship of U.S. production in China), to relocate their factories once it became clear that economic relations between China and the U.S. were in for a long-term downward revision.<\/p>\n

Today, Vietnam isn\u2019t just turning out shoes and clothes. As the Journal<\/em> reports, roughly 60 percent of its exports to the U.S. are machinery or electronics, with companies like Intel, Samsung, and Apple\u2019s own manufacturer, Foxconn, centering much of their production in the country.<\/p>\n

But Trump\u2019s tariffs and the economic rivalry between China and the U.S. can\u2019t really be adduced as the long-term cause of this shift in global production between these adjoining Asian nations. Vietnam is surging for the same reason that China once surged: Labor comes cheap, and the state ensures that worker discontent will be held in check. China\u2019s rise as the world\u2019s factory over the past 30 years has enriched that nation to the point that it now has a massive middle class\u2014a transformation still just getting started in its neighbor to the south. While neither nation has reliable data on median household income (or, in the case of Vietnam, any<\/em> data on median household income), per capita income in China last year came to $14,230, while in Vietnam, it was just $4,970.<\/p>\n

Read more Mental Health Workers Say Algorithmic Triage Is Hurting Patients<\/a><\/p>\n

For American corporations looking to boost their profits (which, as the Journal<\/em>\u2019s Greg Ip recently pointed out, are at their highest share of the nation\u2019s gross income since 1950), the wage differential between China and Vietnam made moving their production to the latter a no-brainer\u2014just as the wage differential between the U.S. and China once made moving their factories from the Middle West to the Middle Kingdom a no-brainer, too.<\/p>\n

A quarter-century ago, when advocates of normalizing trade relations with China insisted that doing so would compel China to transform itself into a democracy, America\u2019s unions, a number of social democrats (including at the Prospect<\/em>), and a smattering of China hands (James Mann in particular) called that argument a non sequitur: Capitalism had co-existed with right-wing authoritarianism and dictatorship, and would with its left-wing (or ostensibly left-wing) counterparts, too. Today, Leninist one-party rule (or in China, neo-Stalinist one-leader rule) gets along just fine with the C-suites of America\u2019s corporations and banks, for the same reason that Wall Street prefers production in \u201cright-to-work\u201d states: the absence of worker power and the ensuing low levels of workers\u2019 wages.<\/p>\n

More than half a century ago, the fear that communism would spread across the globe, particularly throughout the former colonies of Asia and Africa, was one of the foundations of our war in Vietnam. What the architects of that cataclysmically mistaken war failed to foresee was that the American economic establishment, for whose interests they largely worked, would eventually diminish its reliance on American workers and answer only to its shareholders, once the spirit and letter of New Deal regulations had eroded sufficiently. And with that new and refined mission, that it would embrace authoritarians not just on the right but on the left as well, most particularly Leninist capitalism, provided they kept wages down and, therefore, profits up.<\/p>\n

Thus, the story of U.S.-Vietnamese relations: one of ironies and (when it comes to capital\u2019s need for profits) iron laws.<\/p>\n

Read more Health Care Reform Needs More Than Universal Coverage<\/a><\/p>\n<\/div>\n


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