Preoccupied with the threat of a coup, neither Diem nor his brother Nhu seems to have recognized the growing seriousness of the insurgent threat, whose roots lay as much in the inequities of their regime as in the machinations of the communist leadership in the north. True, they attempted to profit from the lessons of the successful British counterinsurgency in Malaya by concentrating the peasantry in relatively large, well- defended villages. The first experiment with this concept, the so-called Agrovilles, was initiated in 1959 and withered away in the face of massive hostility among those whom it was supposed to benefit. The experience served mainly to demonstrate just how little understanding the Diem regime had of the aspirations and fears of the peasantry. A similar display of lack of realism was demonstrated in the regime's official idealogy, Nhu's "Personalist" movement, a weird combination of French philosophical ideas, communist organization and fascist tactics, which served over the short term as a useful propto the regime but utterly failed to attract any following beyond the mandatory membership that was a concomitant of government employment.
By 1959, the weaknesses of the Diem regime had combined with growing Viet Cong confidence and competence to produce the makings of an incipient crisis, though few American observers discerned its dimensions. Diem had followed the expulsion of French forces with a request for American aid and military advisors and by the end of 1959 there were just over 750 U.S. military personnel in South Vietnam. At the same time, the number of terrorist incidents and assassinations of government officials had grown exponentially and, on 8 July, 1959, a Viet Cong attack on Bien Hoa air base killed a U.S. Army major and a master sergeant, the first American combat casualties in Vietnam since the immediate aftermath of World War II. At this pivotal juncture the United States, upon whom Diem and South Vietnam depended, underwent a change of leadership: on 8 November, 1960, Democratic Senator John F. Kennedy defeated Vice President Richard M. Nixon in the presidential election, to replace Dwight Eisenhower as President. By the time the new President was inaugurated on 20 January, 1960, the communists had announced the establishment of the National Liberation Front, the political arm of the Viet Cong, which was set up to provide organization and leadership to dissidents of whatever stripe who were prepared to fight for the overthrow of the Diem regime. Few recognized it at the time. but America was at war.