I had been asked to the hotel to interview Vang Pobzeb, head of something called the Lao Human Rights Council, an organization in Eau Claire, Wisconsin, that lobbies on behalf of the Hmong, a Laotian ethnic minority, and against closer relations between our country and the government of Laos. Despite the fact that his chosen venue seemed longer on bargirls than conference rooms, Vang had managed to lure reporters from two of the three main newswires—myself and a Reuters guy—by dint of his Web site, a product that was a good deal classier than our hotel. The Reuters reporter and I quickly realized that Vang, who spoke so fast that he sounded like a Christie’s auctioneer, had little hard evidence to prove his points. To support his contention that the Lao government was massacring ethnic Hmong, Vang produced a grainy videotape that resembled a ’70s snuff film minus the music. When I played the tape on a VCR, all I could make out were shadowy figures. I half expected Haley Joel Osment to appear suddenly and warn me that I was seeing ghosts.

Still, Vang was talking more about Lao-U.S. and Hmong-Lao relations than any of the local diplomats, most of whom wouldn’t trouble themselves with such a tiny state. Since the U.S. embassy and the Lao government offered us nothing newsworthy to fill out wire quotas—as a wire service journalist for Agence France-Presse, I had to file stories constantly or risk having my sins catalogued in French by my indignant boss—we dutifully jotted down whatever Vang told us and used his briefing in stories. In this small way, our stories helped prevent the United States from strengthening its ties with Laos.

The scene at the hotel encapsulates an important but little-understood shift in the conduct of post-Cold War American foreign policy. These days, ethnic lobbies are about the only American organizations actively engaged in many small countries around the globe. But while they can be helpful—to reporters like me, for instance—ethnic lobbies increasingly determine U.S. action towards these countries, sometimes pushing Washington into extremely inconsistent policies.

Ever wonder, for instance, why the U.S. government bends over backward to develop closer trade relations with a repressive communist regime like China, but maintains sanctions against Cuba? Well, China is a vast new market and a growing military power that threatens U.S. security. American corporations and some military experts believe that engagement with China is crucial. Cuba, on the other hand, poses no military threat to the U.S and is too small a market to be of major interest to corporate America. Consequently, it’s easy for Washington to pander to the noisy Cuban-American lobby.

Laos is a poorer, smaller version of Cuba: a tiny, tropical state of roughly five million people in Southeast Asia that is home to one of the world’s more backward governments. The country’s opaque communist regime routinely attacks opponents and stifles public demonstrations, while its fiscal mismanagement has plunged ordinary Lao citizens into near-African poverty. Laos’ currency, the kip, has plummeted from 760 to the dollar in 1997 to more than 8,000 today. Although Laos has an emerging middle class, many more have fallen into squalor. This year, foreign aid (none of it from the United States) will constitute more than half the government’s budget. Meanwhile, the government celebrated 25 years in power last winter with a Soviet-style parade replete with goose-stepping troops and masses of civilians conscripted to cheer.

Though Laos is neither an expansive potential market like China nor a missile threat like North Korea, there are good reasons to keep an eye on it. One third of the world’s opium supply originates in the northern part of the country. Over the past two years, a series of unexplained bombings and other acts of violence—some allegedly facilitated by Hmong-Americans—have shattered the country’s somnolent atmosphere. What’s more, China is increasing its influence there in order to gain leverage against the U.S. in Southeast Asia.

Thirty-five years ago, Laos was a frontline state in the battle against communism. Top White House, Pentagon, and State Department officials guided our policy towards it. Today, despite the opium production and bombings, it is of little consequence to Washington. But it remains a considerable interest to one small lobby: Hmong veterans of the Vietnam War now living in the United States. In the absence of other interests, U.S. policy toward Laos is now determined by whatever the Hmong’s lobby wants.

The Hmong allied with the United States during the Vietnam War. At the time, Laos was a shipment route for the North Vietnamese communists (the Ho Chi Minh Trail ran through Laos) and thus was the target of intense American bombing. U.S. aircraft dropped more explosives then on tiny Laos than on Germany during World War II. At the same time, the Pathet Lao, a communist-controlled insurgency supported by the North Vietnamese, was attempting to overthrow the country’s comic-opera oligarchy. The Pathet Lao were drawn mostly from the lowland ethnic Lao; the CIA trained and equipped their ethnic enemies, the Hmong, who lived in the mountainous north. More than 20,000 Hmong died in the fighting. Ultimately, the U.S. pulled out, the Pathet Lao triumphed in 1975, and the communists have ruled Laos ever since.

Today, reminders of the war scar the Lao landscape. The streets of Luang Prabang, Laos’ second largest city, display an entire tourist industry developed around unexploded ordnance. For a pittance, I could take a guided tour of the areas American bombers had devastated and buy items fashioned from old shells.

After the havoc wrought on this tiny country and the totalitarian fate that awaited the losers, Washington owed the Hmong, and thousands fled to the United States. Today almost as many Hmong live in America (250,000) as in Laos (300,000). Those who came here settled close together, dominating several congressional districts in Wisconsin, Minnesota, and California. What’s more, many Hmong remained devoted to their wartime leaders, such as General Vang Pao, a Kurtz-like figure who lives in southern California, surrounded by a retinue of worshipful advisors. And some Hmong-Americans have faithfully returned to visit family and friends, sometimes allegedly backing Hmong insurgents in Laos.

Fifteen years ago, Hmong-Americans had little political organization. But as the Hmong and many other groups recognized that the federal government was abdicating policy toward smaller states, they seized the opportunity to set up powerful lobbies. Today, Hmong-Americans have multiple lobbying groups augmented by the power of new technology. Through the Internet, groups like the Lao Human Rights Council can stir up their grass roots—and conceal their true size. The Lao Human Rights Council’s impressive Web site would lead most to assume that the organization has numerous staffers—unless they had met Vang Pobzeb in a shady hotel and realized how little help he was. Cheap airline tickets, the opening of cross-border land links, and the development of more advanced international banking systems enable U.S.-based groups to supply money—or arms—directly to countries they hope to affect.

When leaders like Vang Pao issue an edict, many Hmong-Americans respond. And though many younger Hmong are less interested in Lao politics, the Hmong interest groups still hold a hard line. Speaking with a Washington Times reporter in 1997, Vang Pobzeb said “Any person who speaks out to support the Lao government or support most-favored nation and foreign aid for Laos, they are communist agents.”

A good example of the Hmong lobby’s clout is the U.S. government’s response to the 1999 disappearance of two Hmong-Americans, Michael Vang and Houa Ly, along the Thailand-Laos border. The circumstances surrounding their disappearance remain murky; some Southeast Asia specialists believe the pair had traveled to the region to supply money to Hmong insurgents. Hmong activists believe they were snatched by the Lao government. There is no hard evidence for any of this. In any event, Hmong-Americans pushed hard for an investigation and for retribution against Laos. They got their wish. Congress passed a resolution condemning the Lao government, and the U.S. embassy in Vientiane, the Lao capital, threw all its resources into finding Vang and Ly. The embassy even enlisted the Vientiane Times, the major English-language newspaper that is tightly controlled by the Laotian government. Regular readers of the Times—known primarily for its glowing testimonials to Laos’ few successful industries, such as its national beer maker—must have been surprised when they encountered a large advertisement placed by the embassy seeking any information about the two men.

The quest for Vang and Ly (who have never been found) was a rarity. Absent pressure from Washington—and from ethnic lobbies—some American diplomats in mainland Southeast Asia tend to do their jobs with a healthy dose of bo bpen ngan—an all-inclusive Lao term meaning “relax” or “it doesn’t matter.” During visits to Laos I have often noticed the American charge d’affaires taking it easy at Vientiane’s best patisserie, enjoying an almost colonial pace of life. The laid-back atmosphere makes the U.S. embassy a poor source of information for journalists. I’ve had better luck at the Australian embassy, where the chief political officer gave me terrific, informed briefings, primarily because he actually took the time to interact with Lao people.

And yet, for some of the most difficult stories, ethnic lobbies are often the only source of information. For six months last year, I attempted to find out what went on in the military-controlled zones of Laos: Rumor had it that troops were brutalizing civilians and even helping to run drugs. I badgered diplomats, expatriates living in Vientiane, and the Lao government, to no avail. Fed up with this stonewalling, I turned to the lobbies, and got some results. While the Hmong organizations’ videos and data had to be viewed through a lens of healthy skepticism, the lobbies at least had reports from the military zones—on-the-ground information more valuable than reports culled from news articles.

In these and other ways, ethnic lobbies are of real value. Unfortunately, too often their single-minded devotion kills off arguably better policies. When Congress debated improving trade links with Laos in 1996 and 1997, Hmong-American veterans marched to the Capitol in protest, and so far have succeeded in choking off expanded trade with Vientiane.

The veterans’ enthusiasm may be misguided. In just the past three years, I have seen how limited economic growth, driven primarily by trade with neighboring Thailand, has changed Vientiane. The city remains the quietest capital in Southeast Asia, but since 1998 it has sprouted Internet cafes, satellite television, upmarket restaurants and bars, and many other new establishments. Restrictions on the import of foreign newspapers have been lifted somewhat, and Thai papers like The Bangkok Post are available in Vientiane. Furthermore, Laos is inching away from its isolationism, boosting air links with neighbors and joining several regional political organizations.

All these developments mark the growth of a cadre of middle-class entrepreneurs who may yet loosen the grip of the aging, heavy-handed Vientiane regime. In fact, in 1999, a group of emboldened university students and professors in Vientiane even attempted to stage a peaceful protest against the regime, the first such demonstration since the communist takeover in 1975. (The regime shut down the demonstrations; many of the demonstrators haven’t been heard from since.)

The limited, fitful signs of liberalization in Laos present the United States with an opportunity—and a challenge. When it comes to larger, equally repressive communist states such as China or Vietnam, which Colin Powell just visited, the U.S. government consistently argues for closer trade ties on the theory that trade and economic growth creates a middle class and, subsequently, internal pressure for political reform. This theory may or may not prove true. But certainly, it applies as much to Laos as to China or Vietnam. The real reason we haven’t opened up trade with Laos is that policymakers, weighing the value of doing so against the reprisals of the Hmong, think to themselves, oh well, bo bpen ngan.

But there are greater costs involved when Washington treats similar regimes in opposite ways. Such inconsistency flummoxes American voters, angers foreign governments, and makes the high-minded principles trumpeted by our elected officials sound like empty propaganda. Ethnic lobbies are right to call attention to human rights abuses in their home countries, and they do us a favor when they pick up the slack from slackers in our diplomatic corps. But letting them dictate our policies towards small countries makes no sense.

Joshua Kurlantzick covers trade and international politics for U.S. News & World Report. He has traveled to Laos more than 10 times.