President BILL CLINTON (July 11, 1995): "Today, I am announcing the normalization of diplomatic relationships with Vietnam."

Ambassador ROBERT GALLUCCI: We engaged the North Koreans very narrowly initially on the nuclear issue. I think that engagement has a good chance of leading to political change over time.

WAYNE SMITH: Good Lord, if we can talk to the North Koreans, surely we can talk to the Cubans.

NARRATOR: Vietnam, North Korea and Cuba, three long-time enemies of Uncle Sam. Are we finally ready to declare peace now that the Cold War is over?

Admiral JOHN SHANAHAN (USN, Ret.): I'm Vice Admiral Jack Shanahan, director of the Center for Defense Information. In our program today we visit three Cold War protagonists just to see if there have been any changes.

NARRATOR: For many Americans, "Vietnam" is synonymous with "war." But today, twenty years after that misguided conflict, Vietnam is a country undergoing an historic transition.

With the demise of its Soviet patron, Vietnam's communist government has implemented a policy of "economic renovation" that has opened up the country to a host of influences from the outside world.

President CLINTON: "Today I am announcing the normalization of diplomatic relationships with Vietnam." (Applause.)

FREDERICK BROWN: In my view, normalization in July of '95 was overdue.

NARRATOR: Frederick Brown, directs Southeast Asian Studies at Johns Hopkins School of Advanced International Studies. He spent five years in Vietnam as a foreign service officer and most recently visited there in the summer of 1995.

Dr. BROWN: Normalization is not a fixed destination, normalization is a process, and ever more so with regard to Vietnam, a country with which we had a war, a bitter war.

NARRATOR: Vietnam's forthright cooperation in the ongoing search for the remains of Americans still listed as "Missing in Action" convinced President Clinton to go forward with full diplomatic relations, a decision supported by members of both parties in Congress, many of whom are veterans of the Vietnam War.

President CLINTON: "We have reduced the number of so-called 'discrepancy cases' in which we have had reason to believe that Americans were still alive after they were lost to 55."

JOHN TERZANO: There's been tremendous progress on this issue.

NARRATOR: John Terzano, president of the Vietnam Veterans of America Foundation, led the first delegation of American war vets to visit Vietnam in 1981.

Mr. TERZANO: The US military is going into villages, looking for bits and pieces of American servicemen, while at the same time a lot of these villagers themselves have family members who still remain missing from the war. And the way the Vietnamese people have opened up themselves to allow this to happen is truly phenomenal.

NARRATOR: The Pentagon spends $55 million a year searching for the remains of personnel lost in combat. Casualties from the Vietnam War have been more thoroughly accounted for than from any other American conflict. But the families of those still unaccounted for are looking for answers.

Dr. BROWN: Most of those, you understand, are now declared missing in action and presumed to be dead. The question is how did they die. And I think the Vietnamese will continue to cooperate. Indeed, I think the diplomatic recognition will certainly not slow down the process and may, indeed, speed it up to put -- to write 'end' to this particular chapter.

NARRATOR: Recognizing the changes needed to revive its war-torn economy, Vietnam has recently encouraged private enterprise and free market reforms. The same diligence that enabled the Vietnamese to defeat the French and outlast the American military is now driving an economy that grew by 9 percent in 1994. Vietnam has become the world's third largest exporter of rice and has significant oil reserves. Foreign investment has been growing since the late 80s, but due to the US trade embargo -- in effect, until February 1994 -- American corporations are just now getting into the act.

Dr. BROWN: The Boeing Corporation, for example, estimates that during the next ten years, the number of aircraft that Vietnam will buy from Boeing probably will keep at least 10,000 Boeing employees on the rolls. And you can expand that to companies like Caterpillar, like AT&T, and other high-tech companies who will keep people employed back here in the United States by reason of the business that they're going to be doing in Vietnam.

NARRATOR: With all the glitz of a Hollywood premiere, Citibank recently opened a branch in Hanoi, as did the Bank of America.

LUU LE (Bank of America representative): "I think the past is the past. Let's look at the future, let's build it."

NARRATOR: Constructive engagement with Vietnam not only affords the United States business opportunities, it also opens the door for American cultural and political ideas to take hold.

Mr. TERZANO: Now that we have an embassy there, now that we have people going all over the country, you're going to be able to positively affect the direction that Vietnam is going to take over the next decade-plus. And you do that by engagement, you don't do that by isolation.

NARRATOR: With more than half of its population born since the end of the "American War," as it is called here, the Vietnamese are welcoming and friendly to a growing number of American tourists.

Mr. TERZANO: For them, the war has been over for many, many years. It's still America whose hearts and minds have remained captured by the war.

NARRATOR: Vietnam is still ruled by a one-party government that permits little dissent. But effective pressure to change the political system is most likely to come from within the country, rather than from without.

Dr. BROWN: I think there is no question that opening up to the outside, as Vietnam is doing economically, socially and, I must say, politically, that over time this is going to have an immense impact on Vietnamese society.

NARRATOR: Vietnam is strategically located between China and the thriving nations of Southeast Asia. It is at the crossroads of the fastest growing economic region on earth. By treating Vietnam as a country rather than a "syndrome," the United States has much to gain.

NARRATOR: In early 1993, communist North Korea, long suspected of trying to develop nuclear weapons, refuses access to International Atomic Energy Agency inspectors to two sites thought to be storing waste plutonium. North Korea then announces its intention to withdraw from the Non-Proliferation Treaty, a move that could trigger the treaty's collapse and the global spread of nuclear weapons. Over the next year, high-level talks between the United States and North Korea give way to increasingly hostile actions and rhetoric.

President CLINTON (at the DMZ in Korea, July 1993): "It is pointless for them to try to develop nuclear weapons because if they ever used them, it would be the end of their country."

NARRATOR: A crisis atmosphere grips the news media: Would we go to war again on the Korean Peninsula? But then events took an unexpected turn. Former President Jimmy Carter flew over to meet with North Korean officials and saber-rattling gave way to negotiation. Tensions eased.

Despite the death in July 1994 of North Korea's long-time leader Kim Il Sung and the succession to his son, Kim Jung Il, negotiations continued. In October 1994, the United States and North Korea joined in a "framework agreement" which calls for North Korea to abandon its suspected nuclear weapons program in exchange for two light water reactors from South Korea, improved relations with Washington, and much-needed fuel oil. South Korea and Japan have pledged to provide the major funding.

Amb. ROBERT GALLUCCI: The nuclear issue is essentially resolved. At least it is resolved as long as the agreed framework is implemented.

NARRATOR: As the State Department's ambassador-at-large to the North Korean negotiations, Robert Gallucci is the chief architect of the farreaching and complex agreement.

Amb. GALLUCCI: As a result of the agreed framework, the North Koreans have been brought to accept continuous presence of international inspectors, ultimate acceptance of special inspections, and a return to the Non-Proliferation Treaty. That sounds like a good deal from our perspective, achieved without loss of life and without enormous financial expenditure.

WILLIAM TAYLOR: I think the agreed framework is fatally flawed, quite frankly.

NARRATOR: William Taylor is senior vice president for International Development at the Center for Strategic and International Studies. He has met with the North Korean leadership on several occasions.

Dr. TAYLOR: The one thing it's done is to take North Korea and the previous crisis over North Korea's nuclear program off the Clinton administration's agenda and what it does it put it on the agenda of the next administration, or maybe two administrations removed.

NARRATOR: One controversial aspect of the agreement is that it does not require the North Koreans to permit special inspections of their suspected nuclear sites until key components of the new reactors are built, which could take five years or more.

Amb. GALLUCCI: The capability to put weapons on the ground in significant numbers was present and an agreement was negotiated that would stop that in its tracks, if it's implemented over time. Future administrations are going to have to worry about implementing that agreement just as we do now. It's a matter of constantly pursuing a non-proliferation policy.

NARRATOR: Today, North Korea is an underdeveloped, fearful and isolated nation. It is a political dinosaur, the last of the closed, hard-line communist societies.

NORTH KOREAN Farmworker: "I can proudly say that the conversion of this farm into a beautiful farm is directly linked to the personal instruction and guidance of the dear leader, Comrade Kim Jung Il."

NARRATOR: The end of the Cold War also meant the end of North Korea's political and economic support from the Soviets and Chinese. As an already shaky economy began to decline, North Korea resorted to the nuclear card as the one sure way to get attention.

DON OBERDORFER: I think what motivates the North Korean hierarchy is basically the effort to survive.

NARRATOR: As Northeast Asia correspondent for The Washington Post, Don Oberdorfer made 25 trips to Korea.

Mr. OBERDORFER: The United States has nuclear weapons deployed in South Korea, tactical nuclear weapons, from sometime in the 1970s until 1991.

NARRATOR: From its own point of view, North Korea's sense of insecurity is well-founded. In the past, the United States threatened to use nuclear weapons if war broke out, and today maintains 37,000 troops in South Korea.

Dr. TAYLOR: Thirty-seven thousand troops, US troops in South Korea is probably a lot more than we need. I've argued in the past that we could go down to perhaps one reinforced brigade.

NARRATOR: Current US military spending of $260 billion a year is driven by a strategy that calls on the armed forces to prepare to fight and win two wars simultaneously, without any help from allies, if necessary. In the Pentagon scenario, one of those wars is against North Korea.

While the North Korean military has large numbers of personnel, they are equipped with leftovers of a bygone era.

Meanwhile, our affluent South Korean allies boast twice the North's population, 12 times its economic power, and armed forces equipped by the same modern industrial capacity that churns out cars and electronics. In light of these disparities, North Korea's apparent attempt to build nuclear weapons is not surprising.

Dr. TAYLOR: They know what they're doing. And again, under this nuclear agreed framework, they are in control of the agenda and the timing and are receiving millions of tons of oil and rice to prop up a regime -- from us, the Japanese, and South Koreans -- which is in economic difficulty.

Amb. GALLUCCI: It is my own personal view that we will not be propping up the government with this deal, but by the economic opening that will come from it, we are likely, I believe, to achieve a political opening and I do believe political change is more rather than less likely to result from the agreed framework.

NARRATOR: In carrying out the agreement, North and South Koreans will come into contact on a cooperative basis that has not occurred since the country was arbitrarily divided by the superpowers at the end of World War II.

Mr. OBERDORFER: They drew a line across the narrow part of the Korean Peninsula at the 38th Parallel and they said to the Russians, 'You take the surrender of the Japanese down to this line and we will take, the American troops will take the surrender of the Japanese below that line. Later, we'll unite the country.' Well, unfortunately, what happened was that the Soviet Union and the United States got into a Cold War, the Cold War deepened.

NARRATOR: Half a century later, that Cold War is over. advocates believe the framework agreement could be the beginning of a thaw in US relations with North Korea. For South Korea, alarmed by the problems of an abruptly unified Germany following the fall of the Berlin Wall, there is new hope for gradual reconciliation between the two Koreas.

NARRATOR: As a communist country 90 miles off the Florida coast, Cuba has rankled the US Government since Fidel Castro first rode a revolution to power in 1959. The US tried to get rid of Castro on numerous occasions, from the ill-fated Bay of Pigs invasion in 1961 to a CIA plot to poison his beard. So far, Fidel Castro has outlasted eight US presidents.

Senator JESSE HELMS (R-NC) (May, 1995): "Whether Mr. Castro leaves Cuba in a vertical position of a horizontal position doesn't matter to me. That's up to him and that's up to the Cuban people. But he must -- he will leave Cuba!"

WAYNE SMITH: It's simply very difficult for a great country to come to terms with a tiny, little neighbor that still refuses to do its bidding.

NARRATOR: Wayne Smith was the chief of mission to the US Interests Section in Havana during 25 years with the State Department. Today, he is a senior fellow at the Center for International Policy.

Mr. SMITH: Cuba seems to have the same effect on American administrations that the full moon once had on werewolves.

NARRATOR: For 35 years, the United States has maintained a trade embargo against Cuba in the hopes of causing enough hardship among the Cuban people that they will overthrow Castro.

MARK FALCOFF: I think the trade embargo has served two purposes.

NARRATOR: Mark Falcoff is resident scholar at the American Enterprise Institute and has published widely on US relations with Latin America.

Mr. FALCOFF: The first was during the Cold War to make it more difficult for Cuba to prosecute its internationalist mission, which was to interfere in the events of other countries. Since the Cold War, the embargo remains the only tool that the United States has to reward a transition regime in Cuba. It's the only thing we have to give.

NARRATOR: The embargo has taken its toll on the average Cuban, especially since it includes food and medicine, a provision so strict that not even our embargo against Iraq includes it. However, since the US in the only country in the world which maintains the embargo, some question its utility as a tool to bring down Castro.

Mr. SMITH: The embargo has not worked and no embargo can work when it is a unilateral embargo. The United States is totally isolated in its Cuban policy to such an extent that it's almost a national embarrassment. The vote against us in the United Nations last year was 101 to 2 against our embargo.

NARRATOR: Some claim that the embargo even strengthens Castro's hand by providing a clear external enemy he can point to to justify his policies. Yet now Congress is trying to further tighten the embargo by punishing other countries that trade with Cuba. US policy toward Cuba is strongly influenced by the wealthy Cuban-American lobby based in Miami, which makes substantial campaign contributions to candidates who champion anti-Castro legislation.

JORGE MAS CANOSA (Congressional testimony, March 17, 1994): "Castro is the worst killer that any people living in the Western Hemisphere have ever suffered."

NARRATOR: Because politicians are fixated on wooing the Cuban-American vote, US Cuba policy often overlooks a critical question: Does Cuba pose any threat to the United States today?

Certainly, it did in 1962, when Soviet missiles placed in Cuba triggered a confrontation that brought us to the brink of nuclear war. Now that crisis is marked by this monument on the edge of Havana.

Russia provides no aid and all Cuban troops once stationed overseas have been brought home. These were once the US conditions for opening dialogue with Cuba.

Mr. SMITH: I think the Cubans have concluded that no matter what they do, the United States will always move the goalpost and that there will never be any response from the United States.

NARRATOR: Fuel shortages mean that most Cubans get around on crowded buses or bicycles, even the military.

Mr. FALCOFF: There's always the fear, right or wrong, that in an extreme situation, Castro might try to provoke a military confrontation with the United States rather than to leave quietly.

NARRATOR: But Marine General Jack Sheehan, head of the US Atlantic Command, recently stated: "Cuba is not a military threat to the United States or the region; it is the social and economic collapse of Cuba that I am concerned with."

Mr. SMITH: The administration says that its objective is a peaceful transitional process in Cuba. And yet, its policy of trying to isolate Cuba, keep the pressure on, is more designed to bring about an explosion in Cuba than that peaceful transitional process. That implies a bloody civil war.

A bloody civil war is the last thing that would be in the interest of the United States. It would result in tens of thousands, if not hundreds of thousands of refugees ending up on our shores, pressure on us to go in and stop the fighting, restore order, bog down in a morass in Cuba.

NARRATOR: Without Soviet support, the Cuban economy has struggled. Farms once worked with tractors are now tilled by oxen, and food shortages have led to rationing. Facing up to these new realities, Cuba has recently instituted significant changes in its economy.

Mr. SMITH: The government has opened peasant markets. It has moved ahead to allow artisan markets. It is drafting a small business law, has expanded foreign investments, and taken a number of other rather key steps towards a mixed economy, and the mood has changed. Now there's a sense we're still in economic difficulties, but the government is moving.

Mr. FALCOFF: The Castro regime is at a very crucial point in its history in which it must make certain economic choices for survival. If they make enough of those choices, they will undermine their political hold on the island.

NARRATOR: Most Americans have stereotyped impressions of Cubans. Because US policy makes it illegal to travel to Cuba, few Americans, including politicians, have any knowledge of contemporary Cuban life.

JODY AVIRGAN: You can't change something unless you know about it.

NARRATOR: Jody Avirgan and Sarah Park were part of a group of high school students who chose to challenge the travel ban in June 1995.

SARAH PARK: I should be able to travel anywhere I want to. I'm not -- I'm not like a prisoner within my country.

Mr. AVIRGAN: I just got the impression that everyone was there to lend a helping hand, they're just a fun -- you know, every day there was dancing and parties and it's was just a -- I mean, it's just a very relaxed and a great society.

Ms. PARK: And the Cubans seem like they have a genuine interest in getting to know Americans and they can distinguish between Americans as a people and the government or politics.

NARRATOR: Apparently acknowledging the value of such "citizen diplomacy," in October 1995, President Clinton announced an easing of the travel ban that would permit academic and human rights groups to visit Cuba. But at the same time, he reaffirmed his commitment to the embargo.

Mr. SMITH: We should be concentrating on encouraging the peaceful transitional process. What US policy is doing rather than that is to say when you have become a market economy and when you have achieved a perfect democracy, then perhaps we'll talk to you. What's the purpose of diplomacy? I mean, why talk to them after they've done everything you wanted?

NARRATOR: Just as happened in Vietnam, American businesses are now seeing foreign competitors investing in a potentially lucrative Cuban market, a market that is off limits to them. Growing pressure from the business community to open dialogue with Cuba could provide a catalyst for change in US policy.

Whether it's in Vietnam, North Korea, or Cuba, every foreign policy challenge brings its own set of circumstances. But regardless of region, many analysts today believe that US interests are best served by engagement, trade and cooperation rather than the confrontational military relationships that often marked the Cold War.

Yet Congress seems fixated on the past, as current plans call for boosting military spending while cutting funds for the non-military elements of US foreign policy. Foreign aid, less than one percent of federal spending, is being slashed. Fifty overseas diplomatic missions will have to be closed. Foreign service agencies, designed to constructively engage other countries, are being shrunk and consolidated.

Dr. BROWN: This means the United States increasingly becomes deaf, dumb and blind in its ability to apprehend, to understand what's going on outside its borders. We should look upon our investment in the State Department, and in the Foreign Service, and in the system of foreign aid, and our involvement with United Nations peacekeeping, for example, we should look upon these as investments in the protection of the United States, not as boondoggles, as some in Congress would say.

Adm. SHANAHAN: The United States battled its enemies in Korea and Vietnam in two hot wars without achieving its desired military and political goals. We are now trying constructive engagement with both countries, a process which seems to be bearing fruit. Perhaps we should try the same process in our relations with Cuba. Will it work? Who knows unless we try.

For "AMERICA'S DEFENSE MONITOR," I am Jack Shanahan.