After China became a communist state in 1949, the stability of Japan became of paramount importance to Washington, and Japanese development required access to the markets and raw materials of Southeast Asia. The outbreak of war in Korea in 1950 served primarily to confirm Washington's belief that communist aggression posed a great danger to Asia . Subsequent charges that Truman had "lost" China and had settled for a stalemate in Korea caused succeeding presidents to fear the domestic political consequences if they "lost" Vietnam. This apprehension, an overestimation of American power, and an underestimation of Vietnamese communist strength locked all administrations from 1950 through the 1960s into a firm anticommunist stand in Vietnam. .
Because American policy makers failed to appreciate the amount of effort that would be required to exert influence on Vietnam's political and social structure, the course of American policy led to a steady escalation of U.S. involvement. President Dwight D. Eisenhower increased the level of aide to the French but continued to avoid military intervention, even when the French experienced a devastating defeat at Dien Bien Phu in the spring of 1954. Following that battle, an international conference at Geneva, Switzerland, arranged a cease-fire and provided for a North-South partition of Vietnam until elections could be held. The United States was not a party to the Geneva Agreements and began to foster the creation of a Vietnamese regime in South Vietnam's autocratic president Ngo Dinh Diem, who deposed Bao Dai in October 1955, resisted holding an election on the reunification of Vietnam. Despite over $1 billion of U.S. aid between 1955 and 1961, the South Vietnamese economy lan!.
guished and internal security deteriorated. Nation building was failing the South, and, in 1960, communist cadres created the National Liberation Front (NLG) or Vietcong as its enemies called it, to challenge the Diem regime.
