CURRENT INTELLIGENCE WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A003700030001-0
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 42
• Document Creation Date: December 21, 2016
• Document Release Date: May 19, 2008
• Sequence Number: 1
• Publication Date: July 13, 1962
• Content Type: SUMMARY

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SECRET
CURRENT
INTELLIGENCE
WEEKLY
SUMMARY
CENTRAL INTELLIGIENCE AGENCY
OFFICE OF CURRENT INTELLIGENCE
ARMY review(s)
completed.
State Dept. review
completed
GROUPI
Excluded from automatic downgrading
and declassification
COPY NO. 76
OCI N O.0425/62
13 July 1962
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 July 1962
T H E W E E K I N B R I E F
(Information as of 1200 EDT 12 July)
SOVIET FOREIGN POLICY DEVELOPMENTS e , , , , , , , , m . . Page
Moscow has continued to exploit tension in the Taiwan
Strait area to demonstrate bloc solidarity and Sino-Soviet
"friendship," There are no signs of Soviet apprehension
regardin Peiping's militar intentions,
Khrushchev has publicly alluded to "progress" in the
US-Soviet talks on Berlin
and Radi
IA- -
h
,
o
w
as described
President Kennedy's 5 July press conference remarks on the
talks as a "realistic approach." Soviet propagandists,
however, have said these remarks are in contrast with the
President's proposal in his 4 July address to "widen the
atomic club" throuh'.the formation of a European nuclear
force.
THE USSR AND THE GENEVA DISARMAMENT CONFERENCE , . . . . . Page 4
Khrushchev's routine restatement of the Soviet dis-
armament position in his 10 July speech to the World Congress
for Disarmament and Peace in Moscow suggests that there
will be no significant changes in the USSR's approach at
the 17-nation talks in Geneva, resuming on 16 July after
a one-month recess. Soviet actions during the first three
months of the conference underscored Moscow's unwillingness
to grant any meaningful concessions on disarmament as long
as the Berlin problem remains unresolved. The Soviet dele-
gation probably will continue its tactics which aimed
primarily at discrediting the Western approach to dis-
armament, developing a justification for the eventual re-
sumption of Soviet nuclear testing, and attractin the
support of the eight nonaligned delegations.
PUBLIC SECURITY PROBLEMS IN SOUTHEASTERN CHINA , , . , , > Page
Peiping's public security apparatus is facing a severe
test. Unrest stemming from a variety of causes is general
throughout the mainland but appears acute in the province
of Kwangtung, historically a trouble spot for the central
authorities.
o the d
north and west of Canton have left thousandsfdesti-
tut. and will gravate an alread serious situation.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 July 1962
CROP CONDITIONS IN COMMUNIST CHINA o 0 o a o 0 0 0 0 0 0 o Page 7
The 1962 crop year is apparently off to a poor start
in Communist China. The early crops, which account for
roughly 25 percent of total annual grain production, prob-
ably are no better than last year's below-normal harvests.
Winter wheat is only slightly better than 1961's unusually
poor crop, and the early rice harvest is less than last
year's. There is little prospect for improvement in the
tight food situation at least through early fall.
SOVIET AGRICULTURAL TROUBLES a
o 0. o 0 0 0 o o 0 Page 10
Moscow is gradually conditioning; the Soviet people not
to expect too much of the 1962 harvest. An appeal exhorting
the agricultural workers of Kazakhstan to greater efforts
covered the entire front page of Pravda on 7 July, It
reiterated Khrushchev's recent conservative predictions
concerning prospects for the grain harvest in the Ukraine
and, by implication, cast doubt on his optimistic fore-
cast that the country's total harvest would be the greatest
in Soviet history.
SOVIET-YUGOSLAV RELATIONS
Page 11
The Soviet-Yugoslav rapprochement was considerably ad-
vanced in the past three weeks during visits to-the USSR by
high-level Yugoslav parliamentary and economic delegations.
The desire of both sides to restore friendly relationships
was particularly evident in economic negotiations in which
Moscow appeared to meet all of Yugoslavia's requests. After
the delegations had left Moscow, Soviet President Brezhnev
accepted an invitation from Tito to visit Yugoslavia in
ALGERIA
Page 12
Vice Premier Ben Bella made a triumphant entry into
western Algeria on 11 July. Although his remarks at a
rally in Tlemcen reaffirmed his support of the Evian
accords and the principle of collective leadership for
Algeria, there are indications that his talks in Rabat
with emissaries of the provisional Algerian Government
(PAG) did not resolve the split in the Algerian leader-
ship, Ben Bella
w 1 probab y continue to insist that either the National
Revolutionary Council or a special group of Algerian
National Army commanders meet to resolve the quarrel..
Meanwhile, Algerian Army units loyal to Ben Bella ap-
pear to be consolidating their control over Oran and much
of the countryside,
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 July 1962
LAOS . . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 14
At the Geneva conference the major powers have achieved
substantive agreement on all outstanding issues; foreign
ministers of the participating nations will probably meet
soon to sign the accords. Thailand and South Vietnam,
which had threatened to withhold their signatures, now
appear to be adopting a more flexible attitude, but could
still make trouble. Souvanna, wishing to avoid actions
which could jeopardize the success of the conference, has
instructed his coalition government to suspend the establish-
ment of new diplomatic relations. The government has
formed three token "integrated" battalions to be based
5
2
X1
ment over means to halt it. 25X1
faced with another round of political maneuvering among
its own members, a near collapse of its economy, and
more difficulties in asserting its control even in those
provinces which nominally admit its authority. UN of-
ficials and Western European and African leaders are con-
cerned over the present drift, but there is little agree-
CONGO . . . . . . . . . . . . . . . . . . . . . . . . . . . Page 15
After almost a year in office, Adoula has still not
achieved his main objective--central government control
over Katanga--and the prospects of his doing so appear
dim., Tshomb6, has successfully resisted pressures from
within the Congo, from the UN, and from individual out-
side powers. He has conceded practically nothing in his
negotiations with Adoula. The Leopoldville government is
Student demonstrations in Rangoon on '7 July highlighted
the increasing hostility aroused by his dictatorial tac-
tics. The army's ruthless crushing of this protest will
BURMA
. . . . . . . . . . . . . . . . Page 17
Ne Win's announcement of plans for a comprehensive
authoritarian political organization has made evident his
determination to establish a totalitarian regime in Burma.
PAKISTAN . . . . . . . . . . . . . . . . . . . . . . . . . Page
President Ayub has been encountering increasing
defiance from the National Assembly since it convened in
early June under the constitution he promulgated last
March. A majority of the politicians apparently believe
that the time is ripe to press Ayub for concessions and
to clear the way for future political action. Ayub, 25X1
however, is unlikely to tolerate for :Long what he regards
as destructive opposition and may eventually re-establish
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 July-196,2,-
EUROPEAN INTEGRATION DEVELOPMENTS a o o e . . . o , , . . Page 19
The Common Market (EEC) countries and Britain are
working hard in a generally constructive and optimistic
atmosphere to hammer out a broad agreement by the end
of July on the terms for Britain's accession to the EEC,
Ministerial-level talks at the end of June apparently
settled in principle the problem of EEC association for
African members of the Commonwealth. Two more such
meetings on other problems are scheduled this month,
and the pressure to reach a general accommodation by the
July deadline is great. However, the sort of agreement
now aimed for would leave important questions unresolved,
and on-the-spot observers caution that the talks could
still founder on London's demand for market guarantees
for Commonwealth ex orts of temperate-zone farm products.
BRITISH GUIANA o o o g o 0
Premier Jagan has asked the UN Committee of 17 on De-
colonization to look into the British Guiana problem. This
will prove troublesome to London, which has just postponed
negotiations on setting a date for the colony's inde-
pendence. Jagan's replacement of Minister of Home Affairs
Rai with a probable Communist has cost him some support,
but there is no cohesive opposition to the premier, and
his own party is busy improving its organization. Jagai
has had some success in developing trade with the Commu-
nist bloc.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
13 July 1962
CUBAN MISSION IN MOSCOW p p p p p p
. Page 22
The composition of the Cuban mission which has been
in Moscow since 2 July strongly suggests that the primary
purpose of the trip is to obtain additional military equip-
ment for th
e Cuban armed f Th 1
orces.e1-man group, led
by Deputy Premier and Armed Forces Minister Raul Castro,
was invited b
y the Soviet Df Mii
eensenstry. 25X6
BRAZIL p p. p p p O 0 O O p U O O O O p O O p p p O O . Page 23
President Goulart has won several victories over
Congress in the maneuverings of the past two weeks for a
new prime minister and cabinet. Nationwide strike calls,
although of varying effectiveness, gave him unexpected
support in his insistence on dominating the new appoint-
ments. Goulart displayed new confidence in his own polit-
ical power on 8 July with his nomination as prime minister
of Francisco Brochad . Rocha--nationally unknown except
as an ally of Governor Brizola of Rio Grande do
Sul. If Roch succee s in forming a government, increased 25X6
Brazilian hostility to American private investment is in
protp If he fails there will be it new period of tension. 25X1
PERU .
Fernando Belaunde Terry still claims to be the legal
winner of the 10 June presidential election. The armed
forces have cooled in their support of his claim,'however,
partly because of Belaunde's obstreperousness and partly
because of his growing cooperation with Communists. Polit-
ical leaders are now attempting to form a coalition for
contr
l
f
o
o
congresshih i
, wcs to select the next presi-
dent- after 28
my
SPECIAL ARTICLES
CHANGES IN THE SOVIET UNION SINCE STALIN'S DEATH p p Page 1
The USSR's present leadership, with new methods of
operation, has been able to build a much stronger and more
viable economy than Stalin and to get a much larger seg-
ment of the Soviet population to identify itself with the
Communist system. For these reasons, among others, it
would seem that many of the trends since 1953 are likely
to be endu,ri ncr
THE LOCUST THREAT
O O p O . . p O O . . . , . p . O p . . Page 8
Unusually heavy infestations of locusts this year
threaten crops over an area stretching from India to Syria
and from the Soviet Turkmen Republic to Ethiopia. Supple-
mental food supplies from countries with agricultural sur-
pluses will be needed;to avert famine for man of the area's
inhabitants
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CURRENT INTELLIGENCE WEEKLY SUMMARY
WEEKLY REVIEW
SOVIET FOREIGN POLICY DEVELOPMENTS
Moscow,last week continued
its efforts to exploit the ten-
sion in the Taiwan Strait area
to demonstrate bloc solidarity
and what a Moscow broadcast.
to China termed the "indestruc-
tability of Soviet-Chinese
friendship." Soviet media noted
that the Chinese Communist press
has given front-page prominence
to Khrushchev's 2 July decla-
ration of Soviet support for
Peiping in defeating any
Chinese Nationalist attack on
the mainland. Pravda on 8 July
highlighted an in erview with
Mao Tun, the Chinese delegate
to the Moscow World Peace Con-
gress, in which he stated that
the Chinese people had received
Khrushchev's speech "with great
joy" and "are grateful to the
Soviet people for their aid."
Mao represented the Soviet
leader as stating that the USSR
"is ready, if necessary, to
come to the assistance of the
Chinese people." Soviet com-
mentaries on Khrushchev's speech,
however, are more circumspect,
restricted primarily to repeat-
ing the vague statement of
support which he actually an-
nounced.
The USSR continued to
show no signs of apprehension
regarding Chinese Communist
military intentions. T
Berlin and Germany
Moscow TASS promptly focused
its attention on President
Kennedy's 5 July press conference
remarks on US-Soviet relations
and gave its Soviet audience a
positive impression on the US
desire to continue searching
for a peaceful solution to all
outstanding East-West problems.
TASS quoted the President's
comment that although the US-
Soviet talks were "very diffi-
cult," they would have to con-
tinue, A 7 July Moscow radio
commentary, in "welcoming" these
remarks of President Kennedy,
declared that they "reflect a
realistic approach to inter-
national problems."
Soviet propagandists,
however, have contrasted the
President's remarks on general
East-West relations with his
4 July address in Philadelphia
in which they allege he avowed
the need for the formation of
a European nuclear force.
Izvestia on 6 July maintained
that ITH s suggestion to "widen
the atomic club" did not corre-
spond with the President's
subsequent professions of the
US desire to reduce the possi-
bility of conflict with the
Soviet Union.
West German officials have
been informed by Ambassador
Kroll in Moscow, following his
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CURRENT INTELLIGENCE WEEKLY SUMMARY
recent conversation with So-
viet Foreign Minister Gromyko,
that the German question will
be taken up by Secretary Rusk
and Gromyko at Geneva during
the proposed foreign ministers'
meeting to sign the Geneva
Accords on Laos. Kroll as-
sured Bonn leaders that, al-
though he found Gromyko "more
annoyed than usual" over the
lack of progress on the Berlin
issue, there would be "no
trouble" before the contemplated
Geneva talks and that this
situation would probably re-
main for some time.
Further evidence that
.the Soviets intend to maintain
the relatively stable atmosphere
in Berlin, at least for the
time being, is provided in
General Yakubovsky's request
to return a courtesy call at
the end of July on General
Freeman, US commander in chief
in Europe. Yakubovsky, com-
mander of Soviet forces in
East Germany, last met with
General Freeman on 21 June.
Although no matters of sub-
stance were discussed, their
conversation took place in
a cordial and relaxed atmos-
phere, with the Soviets re-
portedly going out of their
`way to extend hospitality.
The Soviets, meanwhile,
are continuing their efforts
to expand contacts in West
Berlin circles. Moscow is
anxious to assert its alleged
prerogative to participate
in West Berlin affairs in
the event that the Communists
obtain a "free city" agree-
ment.
In recent weeks, the
Soviets have issued a series
of invitations to West Berlin
academic and cultural figures
to visit the USSR for various
conferences and meetings with
Soviet personalities in their
respective fields. In several;
instances, the Soviets have
indicated a willingness to re-
lax their policy of not permit-
ting West Berliners to pre-
sent West German passports for
Austrian Visit to Moscow
During the recent visit of
Austrian leaders to the Soviet
Union, Khrushchev and other So-
viet officials expressed strong
opposition to full Austrian mem-
bership in the European Economic
Community (EEC). Soviet leaders
indicated, however, that they
would'. not necessarily oppose some
special Austrian relationship
with the EEC designed to protect
Austria's important trade with
EEC countries. By not specify-
ing what kind of relationship
they had in mind, they maintained
their freedom to attack whatever
arrangements Austria may nego-
tiate with the EEC.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Prior to Chancellor Gorbach's
visit, Soviet propagandists had
generally maintained that any
form of "association" between
Austria and the EEC, even the
loosest, would have extremely
grave consequences for Vienna
and would amount to a breach of
Austrian neutrality commitments
as assumed under the 1955 State
Treaty.
Common Market
An authoritative Pravda "Ob-
server" article on 9 July continued
Moscow's campaign against the Com-
mon Market in its attack on Presi-
dent Kennedy's 4 July speech in
Philadelphia. Observer alleged
that one would need "a great gift
of imagination" to perceive any
freedom in the Common Market de-
spite the President's attempt to
compare the creation of an "in-
tegrated" Europe with the found-
ing of the United States. Observer
maintained that President Kennedy's
appeal for the "new, united Europe
to join an Atlantic community"
was merely designed to reinforce
the ideas of an "imperialist Euro-
peanism put forward by De Gaulle
and Adenauer."
Moscow continued this line
in its attack on the recent visit
of Adenauer to France. Moscow com-
mentators pointed out that the
joint communique issued on the com-
pletion of the West German lead-
er's visit hopefully referred to
the establishment by the Common
Market members of a "political
union." The USSR has contended
that the US seeks a mutual partner-
ship with the EEC in order to
transform it into a NATO-dominated
economic base in which West Ger-
many plays the leading role.
Algeria
The Soviet Union has main-
tained a restrained attitude to-
ward the events in Algeria since
the struggle for power between
the Ben Khedda and Ben Bella
factions came into the open, and
is pursuing a "correct" diplo-
matic course in order to avoid
any appearance of interfering in
this struggle. Moscow has
characterized reports of this
split as the product of West-
ern anti-Algerian propaganda
and has refrained from making
any comment on this subject.
On 3 July Khrushchev sent
a congratulatory telegram on
the occasion of the Algerian
self-determination referendum
to Ben Khedda as head of the
:Provisional Algerian ove -
me nt
The USSR, having
25X1
granted the Provisional Algerian
Government full recognition in
March, can justify this action
as normal diplomatic conduct
with the legal government of
the country. In its public
statements and diplomatic ac-
tivity, however, Moscow will
probably continue to avoid
identifying itself with any Al-25X1
gerian group, preferring to
await the results of the pres-
ent power struggle
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CURRENT INTELLIGENCE WEEKLY SUMMARY
THE USSR AND THE GENEVA DISARMAMENT CONFERENCE
Khrushchev's routine re-
statement of the Soviet dis-
armament position in his
10 July speech to the Communist-
sponsored World Congress for
General Disarmament and Peace
in Moscow suggests that there
will be no significant changes
in the Soviet approach at the
17-nation talks in Geneva which
resume on 16 July after a one-
month recess. Khrushchev
Charged that the attitude of
the Western powers at the con-
ference shows that they are
not interested in disarmament.
]1e and other Soviet spokesmen
have made it clear that there
is no possibility of progress
on the principal disarmamant
issues prior to an agreement
on Berlin. Khrushchev reiter-
ated this point in his 10 July
speech.
Soviet actions during the
March-June sessions of the
Geneva conference underscored
Moscow's unwillingness to en-
gage in serious negotiations
or grant any meaningful con-
cessions in the disarmament
field as long as the higher
priority Berlin problem re-
mains unresolved. The Soviet
delegation probably will
continue its first-round tac-
tics--which were aimed pri-
marily at discrediting the
Western approach to disarma-
ment, developing a justifica-
tion for the eventual resump-
tion of Soviet nuclear testing,
and attracting the support of
the eight nonaligned delega-
tions.
Efforts for Neutralist Support
These tactics made it
clear that Moscow continues
to regard its slogan of
general and complete disarma-
ment as an effective political
wEirfare weapon against the
West and as a rallying point
for neutralist and nationalist
forces in the non-Communist
world. On both the issues of
general disarmament and a
nuclear test ban, the Soviets
sought to align the USSR with
the neutralist delegations.
Soviet delegate Zorin's first
move was to endorse an Indian
proposal for a moratorium on
testing for the duration of
the conference. He later an-
nounced Soviet acceptance of
the eight neutralists' "com-
promise" proposal for a test
ban control system as the
basis for further negotiations.
He interpreted this proposal,
which provided for an inspec-
tion and control system based
on existing national detection
networks, as an endorsement of
most of the USSR's position. -
The Soviets, however,
failed in their attempts to
persuade the neutralists to
withdraw from or at least boy-
cot,t the conference when the
US resumed atmospheric tests
in late April. The neutral-
ists not only rebuffed these
efforts but informed bloc
delegates that they would re-
main at the conference table
even if the bloc delegations
staged a walkout While they
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CURRENT INTELLIGENCE !'WEEKLY SUMMARY
publicly expressed regret over
the US test resumption, the
neutralists carefully noted
that it was the USSR that had
first broken the three-year
test moratorium last fall.
In view of the present
US test series and the likeli-
hood of an eventual Soviet
test resumption, there is
little prospect for any sig-
nificant movement in Moscow's
position on a test ban con-
trol system. The Soviet dele-
gation will adhere to its po-
sition of November 1961 that
existing national detection
systems are fully adequate to
enforce a test ban agreement
and that no international on-
site inspection of Soviet
territory could be permitted
prior to a general disarma-
ment agreement. The USSR will
continue to oppose Western de-
mands for international veri-
fication of suspected nuclear
explosions with the charge
that the West hopes to use an
inspection system for gather-
ing military intelligence.
The Soviets, however, may
put forward a revised version
of their test ban draft treaty
of last November incorporating
elements of the eight neutral-
ists' "compromise" plan. They
may also at some point in the
negotiations indicate willing-
ness to accept the US-UK pro-
posal of September 1961, later
withdrawn, for a test ban con-
firmed to atmospheric tests.
Although there is no in-
dication that Moscow is inter-
ested in reducing the areas of
disagreement on a phased program
of general disarmament, the
Soviet delegation may give
greater attention to proposals
for so-called "confidence-
building" partial measures,
such as nuclear-free zones,
nontransfer of nuclear weapons
to other countries, and a
NATO - Warsaw Pact nonagres-
sion treaty. These measures,
which have a direct bearing on
European security and the Ger-
man question, would be designed
to support Moscow's broader
political objectives of pro-
moting the stability of the
European satellites and de
facto Western recognition of
the East German regime.
Soviet tactics on these
items, however, probably will
be determined by the course
of the US-Soviet talks on
Berlin. If these talks show
a favorable trend, the Soviet
leaders may prefer to with-
hold such proposals as a
nonaggression pact and non-
transfer of nuclear weapons
for use as bargaining counters
on negotiating a Berlin agree-
ment. If, on the other hand,
the Berlin talks remain dead-
locked, Moscow may decide to
press for some agreement on
these "partial" measures at
Geneva in the hope of record-
ing; some progress on issues re-
lated to the German and Berlin
questions.
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The Peiping regime is fac-
ing a severe test of its public
security apparatus. Unrest
stemming from a variety of
causes is probably general
throughout the mainland but
appears especially bad in South-
east China, and there is reason
to believe that the recent troop
deployment reflected--to a cer-
tain extent--the leadership's
concern about public order in
that area.
Kwangtung has a long his-
tory as a troublesome province,
resentful of rule by northern
Chinese who speak another
language. This localist sentiment
has manifested itself under the
Communists. In 1958 two pro-
vincial party secretaries were
harshly criticized for parochial-
ism and for obstructing Peiping's
orders. Late last year these
same two men were reinstated as
vice governors (but not as party
secretaries) probably in an un-
successful attempt to mollify
local sentiments.
The official explanation
of the imposition of stringent
security measures is that they
have been made necessary by the
danger of an attack launched by
Chiang Kai-shek. Just as im-
portant, however, is the re-
gime's apparent loss of faith in
the loyalty of Kwangtungese.
The mass exodus of refugees to
Hong Kong in May very likely
shocked the Peiping authorities.
In the past few days a new
element has been injected into
the Kwangtung situation. Se-
rious flooding has occurred
in the area to the north and
west of Canton. Thousands of
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CURRENT INTELLIGENCE WEEKLY SUMMARY
persons have been affected by
the flood, and a large portion
of these are almost certainly
homeless and destitute. They
place an additional burden on
the provincial security appa-
ratus.
Reports from Kwangtung indi-
cate that the regime is be-
ginning to drop the relatively
permissive attitude which char-
acterized the period preceding
and during the refugee exodus
to Hong Kong. The authorities
and new restrictions ave een
placed on travel. In the past
Peiping had seemed unwilling
to resort to such measures,
perhaps for fear of the con-
sequences. Apparently the
regime now believes that
conditions in Kwangtung have
deteriorated to the point where
it must acce it the risk.
CROP CONDITIONS IN COMMUNIST CHINA
Weather data, press reports,
and first-hand observations indi-
cate that the 1962 crop year has
gotten off to a poor start in
Communist China. The major early
crops--winter wheat and early
rice--which are harvested in
June and July and account for
roughly 25 percent of total
grain production for the year,
probably are no better than the
below-normal harvests of this
time last year.
Weather conditions over
most of the mainland since last
fall have been characterized
by extremes in rainfall and tem-
perature. Compared with 1959/
60 and 1960/61, rainfall this
year was better in North and
Northwest China, about the same
in Southwest and Central China,
and worse in Northeast, East,
and South China. On balance,
the nationwide precipitation
pattern this year has been well
below normal for the period
November 1961 through May 1962.
Crop conditions in the
northern wheat areas, although
better than last year, have not
been especially good. Rain dur-
ing the fall and winter improved
soil moisture over most of the
area, and yields should be up
compared with the past two years.
However, frost damage during
late March and early April and
a possible reduction in sown
acreage probably offset the
gains to some extent. Diplomats
who traveled between Peiping and
Shanghai in early June reported
that the grain crop looked
"scr?appy" in most of Shantung
and Anhwei and poor in many areas.
Diplomatic sources reported in
May that the wheat looked "thin
and stunted" in Honan and Shan-
tung, and that the crop in the
Peiping area was "clearly not
outstanding." There is not
sufficient data to quantify even
roughly the actual grain pro-
duction, but the winter wheat
crop--which accounts for 80
percent of total wheat pro-
duction--probably was only
slightly better than the un-
usually poor 1961 crop.
The early rice crop, which
generally accounts for about 22.
are starting to crack down on
even minor infractionsP
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Opp
INKIANG1
iN~s~a
2.4X, Hur
kQRTHWE~T-
UT
93.3%
SECRET
COMMUNIST CHINA
Major Winter Wheat
and Early Rice Areas
Winter wheat area
0 Early rice area
Administrative region boundary
Province boundary
t,~ILIppINEs
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SECRET
percent of total rice production,
probably was less than last
year's. Fukien had favorable
weather, but bad weather ham-
pered field work and crop growth
in Kwangsi, most of Kwangtung,
Chekiang, Kiangsi, Hupeh, and
Anhwei. Dry weather during
the spring caused the rice to
yellow prematurely along border
areas near Hong Kong. Plentiful
rainfall since mid-May may have
alleviated the effect of this
dryness somewhat, but probably
not enough to have resulted in
as good an early rice crop as
last year.
Peiping press reports have
since spring complained of
drought in areas of North, North-
east, +zaox
East, Central, and South-
west China, and of sporadic
dryness and flooding in Central, oot
South, and Southeast China. The
press may have overplayed some-
what the seriousness of localized
drought and flood conditions,
but the implications regarding
crop output are probably general-
ly accurate. The pessimistic -,oox
tone of Peiping's comments prob-
ably reflects factors other
than simply weather, such as
shortages of seeds, tools, and
fertilizer and continued prob-
lems with peasant health and
morale.
,o ,o
40
so
Precipitation in: Communist China
I November 1961 Through 31 May 1962
Below-normal early harvests
will prolong if not further aggra-
vate the already critical food
situation on the mainland.)
for the period January-
March 1962, Canton residents
were getting 1,645 calories a
day and rural Kwangtung res-
idents 1,465 calories. Figures
for May 1961 were 1,650 and
1,380 respectively. As May is
normally a low-ration month in
the food year, net rations in
May 1962 were probably not much
better than a year ago. The
figures for Kwangtung are believed
to be representative of other
parts of China.
Arrival of the early har-
vests on the market in June and
July will alleviate the more
serious spring shortages, but
there will be no easing of the
basic food shortage. Rations will 25X1
probably continue inadequate, at
least through the early fall.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SOVIET AGRICULTURAL TROUBLES
Moscow, concerned about the
progress of agricultural work
this season, is gradually break-
ing the news to the population
that prospects for the 1962
harvest are none too good. In
an appeal to the agricultural
workers of Kazakhstan--which
covered the entire front page
of Pravda on 7 July--the regime
reiterated Khrushchev's recent
conservative predictions con-
cerning prospects for the grain
harvest in the Ukraine. By im-
plication the article cast doubt
on his optimistic forecast that
the country's total harvest
would be the greatest in Soviet
history.
The appeal was directed to
the workers of the New Lands
area--which produces over one
third of all Soviet grain. Its
purpose was to exhort them to
great efforts during the harvest
season, but it may well have the
effect of further discouraging
an already disgruntled popula-
tion. The statement that
"...one may hope that the gross
grain harvest and the quantity
of grain purchased this year
will exceed those of previous
years" will hardly cheer a pub-
lic which has recently had to
f ace a 30-percent rise in re-
tail prices for livestock prod-
ucts. In addition, the state-
ment clearly contradicts Khru-
shchev's estimate, made on 27
June at a regional agricultural
conference in Moscow, that,
barring unfavorable weather, the
grain harvest would be between
150 and 160 million metric tons
--well above the record 141.2
million claimed for 1958.
The appeal also reveals
that the familar problems of
the New Lands region continue
despite efforts in the past
year to overcome them. The
problem of maintaining a stable
labor supply in this remote area
for example, apparently con-
tinues to plague the regime.
The appeal scores Kazakh of-
ficials who sent a request to
the party central committee for
70,000 machine operators, in-
sisting that the expense in-
volved does not warrant such a
move. On this point, there
has been inconsistency over the
years. While Khrushchev has
often emphasized the importance
of establishing permanent cadres,
he has also castigated officials
for not asking Moscow for emer-
gency labor when they needed it.
Former Kazakh party chief Belya-
yev, just before his downfall in
1960, was severely criticized by
Khrushchev for just such a fail-
ing. Moreover, permanent cadres
are difficult to establish so
long as living conditions in the
New Lands are as appalling as
they now are. Khrushchev has
recognized this, pointing out
that "you can't treat people in
such a heartless way," but there
has been no substantial effort
to remedy the situation.
In an attempt to relieve the
tight labor situation, the appeal
urges farmers to join two or three
reapers together and thus enable
one man to accomplish what normal-
ly requires three. The efficacy
of this recommendation is question-
able. While more area could pre-
sumably be covered, the quality
of the work would probably be
reduced.
The practice of neglecting
and abusing farm machinery con-
tinues to be a problem through-
out Soviet agriculture and last
year was made a criminal offense,
punishable by up to three years'
imprisonment. The appeal never-
theless notes that "the state of
preparation of harvesting ma-
chinery arouses grave concern
this year as well. By 1 July,
more than 35,000 combines and
about 25,000 reapers still were
not, repaired" in one major re-
gion of the New Lands. The ac-
cusation does not mention one
of the basic reasons for the
condition of harvesting ma-
chinery--the failure of the gov-
ernment to provide spare parts.
Reference in the Kazakh
appeal to the "carelessness"
and "irresponsibility" of agri-
2ultural management does not
bode well for the party leader-
ship in the republic.
r
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SOVIET-YUGOSLAV RELATIONS
The Soviet-Yugoslav rap-
prochement was considerably ad-
vanced in the past three weeks
during visits to the USSR by
high-level Yugoslav parlia-
mentary and economic delegations.
The desire of both sides to re-
store friendly relationships
was particularly evident in
economic negotiations in which
Moscow appeared to meet all of
Yugoslavia's requests. After
the delegations had left Mos-
cow, the Soviet charge in Bel-
grade delivered to Tito Soviet
President Brezhnev's acceptance
of an invitation to visit Yugo-
slavia in the fall.
The Yugoslav parliamentar-
ians, led by party politburo
member Stambolic, were in the
USSR from 19 June to 3 July on
a good-will tour which featured
interviews with Brezhnev and
Khrushchev. Near the end of
their stay, the Yugoslavs heard
their escort, Ivan Spiridonov,
president of the one of the two
houses of the Soviet parliament
acknowledge that Yugoslavia is
building socialism and intends
to build Communism--a rare ac-
knowledgment designed to play
down extant ideological differ-
ences. While the Yugoslavs
were the more conservative in
mutual expressions of friend-
ship, both sides effusively
pledged their intention to con-
tinue the trend of improving
Soviet-Yugoslav relations.
The economic delegation,
headed by Vice President and
politburo member Todorovic,
was in the USSR from 3 to 6
July and was also received by
Khrushchev. According to Yugo-
slav diplomats in Moscow, the
Soviets agreed in principle to
grant credits in 1963, but the
overall amount was not set,
pending consideration of indi-
vidual Yugoslav requests. Yu -
goslav participation in some
of the committees of the bloc's
international economic organi-
zation (CEMA) was also appar-
ently agreed upon in principle.
The Yugoslavs, according to the
diplomats, will "refine" their
request, which will then be con-
sidered on its merit.
A new trade agreement for
19133-65 was also signed by Todo-
rovic and Soviet First Deputy
Premier Mikoyan. This agree-
ment will replace and extend a
long-term trade agreement (1961-
65;1 under which Yugoslav-Soviet
trade was scheduled to grow
about 17 percent in each of the
five years but, in fact, fell
off 22 percent in 1961. Whereas
the old agreement called for
$800,000,000 worth of trade in
five years, the new agreement
calls for $750,000,000 in 1963-
65 alone.
Some progress was appar-
ently made toward resolving
the key problem in Yugoslav-
Soviet trade--an unwillingness
of both parties to offer the
commodities desired by the
other or to buy those prof erred
in existing trade agreements.
On 8 July, for example, it was
announced that a contract had
been signed for Yugoslavia to
build 14 ships for the USSR.
The earlier agreement had called
for sale of 25 ships, but the
Soviets were not particularly
interested in ships of small
tonnage, and Yugoslav shipbuild-
ers preferred to sell to hard-
currency countries. In addition
to indicating Soviet willing-
ness to act on previous trade
commitments, the later trade
agreement either revised or sup-
plemented the commodity lists of
the previous pact.
SEC "T
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Vice Premier Ben Bella
made a triumphant entry into
western Algeria on 11 July.
Although his remarks at a rally
in Tlemcen reaffirmed his sup-
port of the Evian accords and
the principle of collective
leadership, there are indica-
tions that his talks in Rabat
with emissaries of the pro-
visional Algerian government
(PAG) did not resolve the split
among the Algerian leaders.
Ben Bella
to have an important role in
the administration of local
government similar to that
exercised by the Special Admin-
istrative Sections of the French
Army during the later years of
the rebellion. This desire is
said to be particularly strong
among the ALN units from Morocco
and Tunisia, which are frustrated
at having taken little direct
part in the war of independence.
wil probably continue
to insist that either the
National Revolutionary Council
(CNRA) or a special group of
Algerian National Army (ALN)
commanders meet to resolve the
quarrel. Meanwhile, Algerian
Army units loyal to Ben Bella
appear to be consolidating their
control over Oran and much of
the countryside.
Ben Bella continues to
insist that the only real issue
is the PAG's dismissal of three
ALN staff officers, although
PAG Minister of State Mohamed
Khider, who entered Algeria
with Ben Bella, has demanded
that the PAG cabinet be re-
placed. Abdelkadar Chanderli,
the PAG representative to the
UN, explained to US officials
on 11 July that Ben Bella's
quarrel with the PAG related
largely to the role the ALN
should play in Algeria. Ben
Bella, he said, wanted the ALN
1'According
to Chanderli, however, who says
he talked with PAG Foreign Minis-
ter Dahlab by telephone on 11
July, Yazid and Ben Bella had
agreed that the FAG would rein-
state the ALN staff officers,
who would then publicly proclaim
their loyalty to the PAG. After
this, according to Chanderli,
the CNRA would meet to nominate
a committee to select a slate
of candidates for the Algerian,
elections, now scheduled for
12 August.
Chanderli admitted, how-
ever, that it was on this issue
that the last CNRA meeting in
Tripoli broke up, with Ben
Bella's followers, although in
a majority, unable to muster
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JIX.JLCl
CURRENT INTELL.LGENCE WEEKLY SUMMARY
the necessary two-thirds vote.
Should this deadlock within the
CNRA continue, which seems
likely, Ben Bella will probably
resort to other means of curb-
ing Ben Khedda and the PAG.
Although the PAG was re-
shuffled on 6 July, apparently
better to define the functions
of the various ministers and
to increase efficiency, its
influence outside the Algiers
area is tenuous. There is
little indication that either
the PAG or the Provisional
Executive has made any signif-
icant progress in revitaliz-
ing the country's large adminis-
trative structure, which even
before independence had been
virtually paralyzed by Secret
Army terrorism and French in-
difference.
of Algerians.
Last week French Minister
for Algerian Affairs Joxe told
a US Embassy officer that unless
the central government establishd
its authority quickly through-
out the country, some form of
federalism would very likely
develop. Joxe's cabinet chief
said on 10 July that he was
less fearful of immediate
violence resulting from the
PAGE-ALN quarrel than he was
of the effects of administra- 25X1
tive deterioration and post-
independence disillusionment
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CURRENT INTELLIGENCE WEEKLY SUMMARY
At a 9 July plenary ses-
sion of the Geneva Conference
on Laos, all the Communist del-
egations accepted the terms of
the drafted Laotian Declaration
on Neutrality. They made no
effort to modify the wording
concerning SEATO; the draft
adds the words "including SEATO"
to the paragraph in which the
Kingdom of Laos pledges not to
recognize the protection of an
alliance or military coalition.
This phrase will be omitted if
SEATO takes note of the declara-
tion and indicates that is with-
drawing the protection it has
extended to Laos.
The Soviet and Chinese Com-
munist delegates had previously
demanded both that the declara-
tion specifically disavow any
tie with SEATO and that SEATO
amend its protocol so as to drop
any mention of Laos. Soviet del-
egate Pushkin has told Assistant
Secretary Harriman that, if the
SEATO governments accepted either
Laotian proposal, there would be
no further business before the
conference. This indicates that
the Communist delegates have in
effect dropped their demand that
SEATO members take a specific
action which would then be re-
corded in the conference docu-
ments.
The Communists' apparent
acceptance of the compromise for-
mula on SEATO probably reflects
their satisfaction with the de-
cision not to make reference in
the final agreements to the inte-
gration and demobilization of the
rival Laotian forces. The Commu-
nist bloc has consistently op-
posed any reference which opens
the way to international super-
vision of the dissolution of
"private armies" in Laos. Both
the Phoumi and the Souphannouvong
factions opposed such a refer-
ence; Phoumi apparently feared
that while his troops would be
conspicuously subject to foreign
observation and forced into early
demobilization, Pathet Lao
forces could remain intact in
mountain areas secure from
foreign observation.
With these two issues re-
so]'.ved)the Communists appear
ready to sign an agreement that
will bring the 14-month-long
conference to a close. Western
delegations anticipate that the
foreign ministers could gather
in Geneva sometime between 19
and 23 July if agreement could be
reached among SEATO members to
accept the wording in the Neu-
trality Declaration concerning
SEATO.
Vientiane's announcement
early this month that Laos
planned to recognize North
Vietnam, Communist China, and
East Germany has rekindled the
"divided nations" issue and
aroused widespread controversy.
Souvanna, wishing to avoid ac-
tions which could jeopardize
the success of the conference,
has instructed his coalition
government to suspend the estab-
lishment of new diplomatic rela-
tions. South Vietnam at one
point threatened to withhold
its signature of the Geneva
agreements over this issue, but
now appears to be less inflexi-
ble. Thailand, too, appears to
be coming around after earlier
threatening not to sign the ac-
cords, but both could still
make trouble.
gotiations.
In Laos, meanwhile, three
"integrated" battalions have been
formed which will be stationed in
Luang Prabang, Vientiane, and Xieng
Khouang. The battalions are com-
posed of three 145-man companies--
one from each of the rival forces.
Command is to be rotated among
representatives of the three fac-
tions. This appears to be merely
token integration, designed to pro-
vide nominal security forces in the
major administrative centers. Full
integration and demobilization of 25X1
surplus military forces are likely
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SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
With the breakoff of his
third round of talks with Ka-
tanga's Tshombdi, Congolese
Premier Adoula has indicated
his bewilderment over what to
do next. He told the US ambas-
sador last week that Tshombe's
idea of a settlement was com-
pletely different from his own
and that he was "not going to
have any more to do with it."
Adoula's frustrations
arise out of the fact that he
has neither forces nor finances
to use against Tshomb6, while
the Katangan leader still has
a 12,000-man, European-led
gendarmerie and the tux reve-
nuesfrom the Belgian mining
operations. The Congolese
Army (ANC) is over twice as
large as Tshombe's, but it con-
tinues to be undisciplined,
without experienced leadership
or sense of strategy, and utterly
primitive in its logistics. UN
efforts to retrain it have
never gotten under way.
Adoula thus has been forced
to depend on the multinational
UN Command, whose actions are
determined not in Leopoldville
but in New York and which is
subjected to a variety of inter-
national pressures. UN forces
in two battles with the Ka-
tangans were bested in the first
round by superior military capa-
bilities; in the second, they
were denied full victory by an
international outcry against
the fighting and Tshombe's an-
nouncement that he was willing
to negotiate. Since then Tshom-
be has been assiduously culti-
vating international opinion
favorable to Katanga, and UN
military action against him has
become an increasingly diffi-
cult step for the UN to take.
The predictably fatal
effect on Adoula's leadership
of continued failure in Ka-
tanga and the deepening eco-
nomic crisis both in the Congo
and in the UN lead even oppo-
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nents of strong action like
the British to admit that
something must be done, but no
consensus has appeared. It is
very doubtful that Belgium or
Britain--which have the main
financial interests in Katanga--
can be persuaded to apply ef-
fective economic pressure on
Tshombe. The British in par-
ticular remain vehemently op-
posed to any move which would
precipitate another round of
fighting. Belgian Foreign
Minister Spaak says he is will-
ing to withdraw Belgian tech-
nicians from Katanga, but he
has failed to persuade Union
Miniere (UMHK) officials to
deny Tshomb6 tax revenues.
The mining companies argue that
any such action by them would
provoke Katangan retaliation
against their installations.
UN Under Secretary Bunche
believes that the next effort
should be to convene the joint
commissions agreed to by Adoula
and Tshombo, after which the
two loaders should meet again.
If nothing comes of this,
Bunche has said, the secretary
general would present the
problem to the UN's Congo Ad-
visory Committee and tell it
the time has come for economic
sanctions, e.g., moves by the
UN to collect Tshombe's mining
revenues and to control his ex-
ports, together with Belgium's
freezing UMHK assets in Brus-
sels. U Thant, however, is
concerned with the effects re-
newed fighting would have on
the UN finances. He feels that
he needs a new mandate from the
Security Council for such moves,
although he is aware of the
difficulties of obtaining a
tougher Security Council reso-
lution in the face of probable
British and French opposition.
TshombC, meanwhile, main-
tains an appearance of reason-
ableness: he has offered $2,000-
000 in aid for the rest of the
Congo and quickly appointed the
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CURRENT INTELLIGENCE WEEKLY SUMMARY
Katangan members of the joint
commissions. At the same time,
however, he is probably financ-
ing moves to undermine Adoula.
He has publicly joined the
attack on Foreign Minister
Bomboko and has charged that
Adoula no longer has the sup-
port of the Leopoldville par-
liament. Anti-Adoula groups
from Leopoldville have been
reported conferring with Ka-
tangan leaders in Elisabeth-
ville.
In Leopoldville, Adoula
has tried to ward off the po-
litical attacks on his govern-
ment by making another cabinet
reorganization. The main at-
tack has come from a coalition
of extreme leftists led by
Lumumbist Vice Premier Chris-
tophe Gbenye and "rightist"
dissidents including Tshombd's
Conakat deputies. The im-
portant Leopoldville Province
party Abako, led by Congolese
President Kasavubu, has also
been antagonized by a bill
which would make a federal
district of Leopoldville city.
Abako, normally pro-Adoula,
now has joined the attack.
Preliminary reports on
Adoula's reorganized cabinet
state that Bomboko, a particu-
lar object of opposition as-
sault, has been retained as
foreign minister. Interior
Minister Kamitatu, a former
Gizengist who has become a
stalwart of the Adoula regime,
has also been kept on. Gbenye
has been dropped, although six
lesser lights of the moderate
wing of his party were given
posts. The anti-Tshombd Baluba
tribal leader from northern
Katanga, Jason Sendwe, is re-
tained as the only vice premier.
Gizenga had been one of
the three vice premiers, as had
Equateur Province leader Jean
Bolikango. Adoula, during his
talks with Tshombd, offered to
Adoula continues to have
trouble in the provinces which
nominally recognize his author-
ity. Orientale, Kasai, and Kivu
have been particularly trouble-
some, as pro- and anti-Adoula
forces struggle for provincial
power. In Orientale, Adoula has
sought ever since the disinte-
gration of the Gizenga regime
there to establish a government
more responsive to Leopoldville.
Even if the Katangan prob-
lem were miraculously solved,
new difficulties thus would be
likely to spring up. One of
the dangers likely to face any
central government is the grow-
ing demand for the creation of
still more provinces--possibly
as many as 18. These demands,
reflecting tribal differences,
are being taken up by a host
of local political leaders who
see themselves as future pro-
vincial presidents. The over-
all trend at present thus is
toward greater fragmentation
rather than toward unity.
SECRET
13 July 62
establish a vice presidency for
him and two other ministries
for other Katangan leaders, but
the offer was rejected. Gbenye,
Bolikango, and their followers
now are likely to move even
closer to the Gizengists, and
to the Conakat party.
Adoula has stayed in office
in part because there have been
no other leaders able and will-
ing to take on the job. His
opponents are clearly becoming
bolder, however; they find am-
munition in popular dissatis-
factions over the high living
of government officials in the
face of unemployment and hunger
among the masses. The Congo's
foreign exchange reserves are
again near exhaustion, and there
is talk of another devaluation.
The Congolese franc now is
quoted in Brussels at 300 to
the dollar; par is 64.'
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,now %me
SECRET
CURRENT INTELLIGENCE WEEKLY SUMMARY
General Ne Win's determi-
nation to establish a total-
itarian regime and disciplined
society in Burma has been high-
lighted by his plan, published
on 4 July, for an authoritarian
political organization to carry
out government policies. Dis-
illusioned with the vacilla-
tions of former Premier Nu's
civilian administrations, Ne
Win has become convinced that
Burmese voters are not ready
for democracy.
He apparently intends
to remodel Burma's political
structure using the same tech-
niques he applied in the
development of his army: the
selection of a small core of
dedicated professionals per-
sonally loyal to him which,
after it is trained, will
train and lead an all-power-
ful national party. His plan
borrows some features from
Communist systems, but essen-
tially it sets up a compre-
hensive politico-military
organization intended to pro-
vide the leadership of Burma
through an indefinite period
of political tutelage.
Ne Win has warned that, while
he will accept constructive criti-
cism, "obstructionism" will be
ruthlessly suppressed.
This has left little
outlet for the growing opposition
aroused by his dictatorial tactics.
The Rangoon University
student demonstrations on 7
July were the sharpest manifes-
tation of this hostility to his
four-month-old regime. Ne Win
reacted with brutal vigor. Army
units, called in to restore order,
dispersed the student mob by fir-
ing on it, killing 17 and wounding
at least 60 others. The next day
Ne Win closed all Burma's college-
level and professional institutions
indefinitely, and army demolition
squads destroyed the student union
building, for 25 years the center
of radical student forces.
Ne Win undoubtedly intended
this action to serve as a warning
to potential opponents among civil-
ian political organizations, the
ethnic minorities, and critics 25X1
within his army. His action is
more likely to add to the discontent.
Pakistani President Ayub
has been encountering increasing
defiance from the National
Assembly since it convened in
early June under the constitution
he promulgated last March. A
majority of the politicians ap-
parently believe that now is the
best time to establish the
ground rules for future political
action, and they have been pre-
occupied with increasing the
opportunities for political gain.
Many assembly members, and even
some other politicians who have
been barred by martial law
tribunals from engaging in polit-
ical activity for the next few
yearsyhave been agitating for
concessions from Ayub. They ask
the release of all political
prisoners, the re-establishment
of political parties, and broader
guarantees of civil rights.
Most political leaders are aiming
at a thorough revision of Ayub's
constitution as a means of re-
storing their former predominance.
A few leaders, however,
are showing more caution, prob-
ably feeling that they stand to
lose more than they will gain if
they push Ayub too hard too fast.
Ayub has tried to work through
these potentially cooperative
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CURRENT INTELLIGENCE WEEKLY SUMMARY
leaders--he was appointed seven
of them to his cabinet--and to
avoid a showdown in the hope
that he can get some coopera-
tion from the assemblies. His
limited concessions to the
politicians merely served to
stimulate further agitation,
however, thereby strengthening
his conviction that they are
irresponsible and self-centered.
On 6 July the Ayub govern-
ment arrested Qayyum Khan, a
prominent politician who, de-
spite a ruling barring him from
political activity, was publicly
attacking Ayub. This arrest
was apparently intended as a
warning to others to tone down
their criticisms and agitation,
but on the same day 90 of 156
National Assembly members
wa"Lked out of the assembly in
protest.
Ayub is unlikely to tolerate
for long what he regards as de-
structive opposition. If he con-
martial law.
cludes that his personal posi-
tion is being undermined or
that the politicians are sabo-
taging his new constitutional
government, he may re-establish
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The negotiations on Britain's
entry into the Common Market (EEC)
have probably entered a decisive
phase, but by no means the final
one. The end-of-June meeting of
EEC and UK ministers brought closer
to solution several issues of con-
siderable importance, and two more
ministerial meetings are scheduled
before the end of July--when Lon-
don hopes the outlines of an agree-
ment will have emerged. Despite
the constructive attitude of all
parties and the generally prevail-
ing optimism, however, the remain-
ing issues are exceedingly complex,
and on-the-spot observers, includ-
ing the US ambassador to the Euro-
pean community, continue to cau-
tion that one or more "crises" may
precede a final agreement.
French agreement in principle
that the African members of the
Commonwealth and a number of Brit-
ish dependencies may be offered
direct association with the EEC
appears to have been the most spe-
cific achievement of the 28-30 June
ministerial meeting. London has
insisted from the beginning that
the areas in question should ob-
tain the same terms for association
as the EEC offers the colonies or
ex-colonies of France, Belgium, the
Netherlands, and Italy. The belated
agreement among the EEC countries
last month as to what those terms
should be has made it possible to
meet London's demand. Problems
may still arise, however, over
African dissatisfaction with the
EEC developmental aid offer and
the need to redistribute such aid
if the association of the British-
sponsored countries becomes a fact.
The major portion of the min-
isterial meeting was devoted to pro-
longed and indecisive discussion of
the problem most likely to block an
agreement: Canada's, Australia's,
and New Zealand's exports of farm
products. The Common Market ap-
pears willing during a transitional
period ending in 1970 to share with
Commonwealth producers certain of
the preferences to be extended to
its own farmers. The crux of the
issue thus is the treatment Common-
wealth exporters are to receive at
the end of this period. The EEC
shows few signs of accepting Brit-
ain's demands for permanent market
guarantees. It has, however, of-
SECRET
13 July 62 WEEKLY RE
V]EW
fered a general undertaking to
pursue an internal EEC pricing
policy which would not encourage
excessive EEC farm production,
and a promise to negotiate long-
term agreements to stabilize com-
modity markets, probably at a higher
price level. From London's point
of view, the difficulty with the
latter approach is that it would
probably involve a substantial net
increase in Britain's food imports
bill.
Macmillan's plans for present-
ing to Parliament at the end of
July an EEC-UK "agreement" thus
depend on making substantial prog-
ress at the special meeting on
agriculture set for 18-20 July,
and at the regular ministerial
meeting scheduled for 25-27 July.
At best, any agreement achieved in
the time remaining seems likely to
be very general, and would neglect
many important details and difficult
questions which would require much
more negotiation. Among the latter
are likely to be the future relation-
ship of Britain's Outer Seven part-
ners to the EEC, the European polit-
ical union treaty, Britain's member-
ship in EURATOM and the Coal-Steel
Community (CSC), and certain broad
monetary questions. As an indication
of the difficulty of these problems,
Bonn has shown some concern that its
coal surplus may be aggravated by UK
accession to the CSC and that it
might be committed to help "shore
up" the pound sterling.
ments.
All parties at the Brussels
talks, however, are convinced that
the future of Europe is at stake,
and the pressure to reach agreement
is great. Adenauer has shown in-
creased impatience with the deadlock
on the political union treaty, and
last week persuaded De Gaulle to go
along with a new attempt to reach
agreement prior to Britain's EEC en-
try. Belgian Foreign Minister Spaak,
who is largely responsible for having
blocked the political treaty until
the UK-EEC issue is decided, is also
showing renewed interest in the prob-
lems of political integration in an
enlarged community, and has invited
about 40 prominent political figures
to meet with him on 18 July to ex-
change ideas. Finally, speculation
is increasing about the military im-
plications of uniting Europe and about
the policies a united Europe would
adopt on missiles and nuclear arma-
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Britain faces fresh diffi-
culties with the anticolonial-
ists at the UN over the British
Guiana problem. Premier Jagan
has asked the UN's Committee of
17 on Decolonization to give ur-
gent attention to the colony as
a result of London's postpone-
ment, probably until October,
o talks to set an independence
date. The committee is delaying
action pending receipt of an ex-
planatory letter from Jagan, but
its more anticolonialist members
will probably push through an in-
vitation to Jagan to present his
case in New York.
Jagan is patently anxious
that this be done, partly be-
cause the report of the Com-
monwealth committee of inquiry
into the severe riots in the
colony last February is due to
appear late in August. This re-
port will probably illuminate
the Jagan government's incompe-
tence, and the chairman of this
committee has already indicated
that Jagan's own testimony be-
fore the committee established
him as a Communist "beyond perad-
venture."
The situation in the colony
--still garrisoned by about 450 Brit-
ish troops of the East Anglia
regiment sent to quell the Feb-
ruary disturbances--will not
be eased by Jagan's move. For-
mer minister for home affairs
Rai, who was removed from office
by Jagan on 15 June, has a con-
siderable following on both per-
sonal and ideological grounds,
particularly among his fellow
East Indians, and may in time
become a rallying point for
anti-Jagan elements at present
badly disorganized. However,
Rai's recent discussions with
Forbes Burnham, opposition
leader in the legislative coun-
cil, about forming a coalition
have apparently produced no re-
sult. Known as an anti-Commu-
nist, Rai would encounter rugged
opposition from Jagan's Progres-
sive People's party (PPP) ma-
chine if he were to attempt to
1f orm a new party.
Meanwhile, the PPP is con-
centrating on Communist indoc-
trination of its rank and file.
Janet Jagan, the party's best
tactician, has resumed the edi-
torship of its weekly news
paper, Thunder, and the party
next month plans to put 500 of
its members through a course
in "socialist political educa-
tion." Opposition sources
report that the PPP has begun
to train an East Indian militia
as the nucleus of a national
army. Jagan has asked several
countries for military instruc-
tors.
The Communist element in
the PPP has also strengthened
its hold in the government by
the appointment of Claude Chris-
tian--a probable Communist--as
the new minister for home af-
fairs. This puts a loyal Jagan
man--of limited ability--in
charge of the colony's police,
with responsibility for dealing
with any recurrence of disorders.
As chairman of the PPP youth
organization, Christian has been
active in sending "students" to 25X1
Cuba and to Soviet bloc coun-
tries--some presumably for para-
military training.
The signing on 7 July of
an agreement to sell 3,000 tons
o:L' rice to Czechoslovakia is the
first fruit of Jagan's efforts
to develop government-to-govern-
ment trade relations with the
b:Loc. Negotiations are also
under way with Poland and East
Germany. In his requests for UN
technical assistance, Jagan has
specified that he mainly wants 25X1
advisers from Communist countries
or from those with governments of
known leftist views.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
CUBAN MISSION IN MOSCOW
The composition of the
Cuban mission which has been in
Moscow since 2 July strongly
suggests that the primary pur-
pose of the trip is to obtain
additional military equipment
for the Cuban armed forces.
The 11-man group, led by Deputy
Premier and Armed Forces Minister
Raul Castro, was invited by the
Soviet Defense Ministry. Defense
Minister Malinovsky and other
ranking Soviet officers met
Castro at the Moscow airport,
and on 3 July Khrushchev granted
him an audience.
Ten men accompanied Castro
on his flight from Havana to
Prague, the first leg of the
j ourne
Other members of the mission
are Cuban army and air force
officers. Theyinclude Captain
Victor Pina Cardozo, an air
force officer engaged in arms-
purchasing missions since 1959;
he traveled to Czechoslovakia
with a group of air force
trainees in July 1960. Others
are Major Calixto Garcia, com-
mander of Cuba's Eastern Army;
Captain Rogelio Acevedo, at
least until recently commander
of the Cuban militia; and Major
Samuel Rodiles Planas, a police
officer who may recently have
been transferred to the air
force.
This is Raul Castro's first
visit to Moscow since June
1960, when he probably nego-
tiated the initial agreement
for Soviet military assistance
to Cuba. Deliveries began
less than three months after
his return. Another agreement
was apparently concluded in
the summer of 1961 for addi-
tional Soviet arms which have
been delivered this year. Castro
may be seeking additional equip-
ment, including more advanced
items such as missile-equipped
MIG-21 jet fighters and surface-
to-air missiles, which Moscow
now is providing to Indonesia,
Egypt, and Iraq.
Rumors that Raul Castro
is to sign a "defense agree-
ment" with the Soviet Union
have been heard in Havana.
While the Cubans would
probably welcome--and may
even be pleading for--a So-
viet commitment to come to
Cuba's defense militarily
in the event of an attack,
it is highly unlikely that
the Soviet Government is pre-
pared to make such a commit-
ment.
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CURRENT INTELLIGENCE WEEKLY SUMMARY
BRAZIL
Brazilian President Goulart
has won several victories over
Congress in the maneuverings
of the past two weeks for a new
prime minister and cabinet, de-
spite the constitutional amend-
ment of September 1961 estab-
lishing a parliamentary system
with implied legislative domi-
nance. Confirmation of his
latest nominee for the Prime
Ministry, the little-known
Francisco Brochado da Rocha,
shows that for the moment at
least Goulart has the upper hand.
Goulart's first nominee,
the ambitious leftist San Thiago
Qantas, was rejected by the
legislature. The fact that
some of Goulart's supporters
did not vote for Dantas may in-
dicate that the rejection was
planned by Goulart as a way of
blocking a potentially dangerous
rival.
Goulart's second nominee,
Senate President Moura Andrade,
was confirmed in office by the
Chamber of Deputies but resigned
one day later because Goulart
would not nominate the cabinet
members Andrade had chosen.
Goulart apparently believed he
had a commitment from Andrade
to push for the restoration of
a strong presidential system
and had not expected Andrade's
effort to make himself an inde-
pendent prime minister. Organ-
ized labor under considerable
Communist influence called 24-
hour strikes in major cities
throughout Brazil in support of
Goulart. The strikes were scat-
tered but impressive by Brazil-
ian standards and hence politi-
cally effective. Military lead-
ers--who had been placed in
their present posts by Goulart--
also supported the President.
Goulart's nomination
of Rocha on 8 July reflects the
President's increased confidence
in his own political power.
Rocha is almost unknown nation-
ally in Brazil except as an ally
of Leonel Brizola, governor of
Rio Grande do Sul, brother-in-
law of Goulart, and a principal
candidate for leadership of the
leftist-nationalist forces in
Brazil.
Rocha is a constitutional
lawyer, born 8 August 1910 in
Porto Alegre, capital of Rio
Grande do Sul. He entered
politics in 1930 as a supporter
of Getulio Vargas, who took
over the government in a coup
in that year and ruled until
1945. Rocha's father and
brother have both been mayors
of Porto Alegre, but Francisco
long preferred a background
role. He was a special "un-
official" adviser to Brizola
when Brizola was mayor from
1956 to 1958 and continued his
advisory role after Brizola's
election as governor in 1958.
During this time he had a hand
in the rejection of US aid to
the police in Porto Alegre.
Rocha belonged at first
to the heterogeneous but pre-
dominantly conservative Social
Democratic party (PSD) but un-
officially broke with it a few
years ago to work in the left-
ist Labor party. He has re-
cently been under consideration
in Rio Grande do Sul for the
Labor party's nomination for
the Senate. Apparently, how-
ever, Rocha never enrolled as
a member of the Labor party,
and because he was largely
unknown in Brasilia, Goulart
was able to present him to
congress as a member of the
PSD, the largest party in
congress. This may have been
a major factor in his confirma-
tion.
Rocha was described by
the US consul in Porto Alegre
as one of the cleverest law-
yers in the southernmost part
of Brazil in October 1961.
At that time, Brizola had
asked Rocha to investigate
charges that certain elements
in the state government favored
Communist activities. The in-
vestigation was apparently in-
tended to justify Brizola's
regime.
Rocha was a key adviser
in the expropriation of a sub-
siLdiary of the Electric Bond
and Share Corporation in 1959
and was a Rio Grande do Sul
secretary of interior and
SEC"tistice in early 1962 when a
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subsidiary of International
Telephone and Telegraph Company
was expropriated by the state
government. Rocha's few public
statements suggest that he
shares Brizola's resentment
both of foreign capital and
of capital from Brazil's key
industrial state of Sao Paulo.
Rocha's skill as a constitu-
tional lawyer would be useful
to Goulart both in moves against
foreign-owned utility and mining
Fernando Belaunde Terry,
vociferous candidate of the
leftist Accion Popular, still
claims that he is Peru's presi-
dent-elect. His claim is based
on his allegations that he re-
ceived more than one third of
the legal votes cast on 10 June
and that the ballots which gave
APRA's Victor Raul Haya de la
Torre a slim plurality are
fradulent and should be annulled.
In spite of the report that an
army spokesman assured Belaunde
on 11 June that he would win by
40,000 votes, the official
count by the National Elections
Board and the unofficial counts
by several press services, the
navy and the candidates' repre-
sentatives all showed Haya lead-
ing by about 14,000. Because no
candidate received more than
one third of the total vote,
Congress must select the new
president after it convenes on
28 July.
Belaunde has threatened to
lead an "insurrection in the
hills" if he does not become
president. He was imprisoned
for a short time for attempting
a similar insurrection after his
defeat in the 1956 presidential
election, but was never brought
to trial. The Communists have
supported his claim through their
various propaganda outlets, and
they have threatened to call a
general strike if the elections
board "ignores" the charges of
fraud.
Peruvian military leaders
have become increasingly dis-
companies--which would enhance
Goulart's popular appeal--and
in maximizing Goulart's polit-
ical power without overstepping
the constitutional boundaries
which the Brazilian military
guard jealously.
Should Rocha fail to
reach agreement with congress
on cabinet appointments and
resign, a new period of ten-
sion is likely.
enchanted with Belaunde because
of what one officer called his
"electoral paranoia." Fear of
a victory by Haya had led them
to champion Belaunde, but they
do not countenance Belaunde's
extravagant claims and threats
of violence.
An extraordinary national
convention of APRA leaders last
weekend rejected the army's ul-
timatum that Haya's name be with-
drawn from the list of presiden-
tial candidates to be considered
by Congress. Although the mili-
tary leaders h,d threatened a
military coup if their demands
were not met by the weekend,, they
now appear resigned to letting
Congress choose the next presi-
dent in accordance with the
constitution. However, they
have not rescinded their pre-
election threat to launch a
coup "if necessary" to prevent
Haya's taking office.
Conversations are continuing
between APRA leaders and members
of Manuel Odria's National
Union (UNO). An APRA-UNO coali-
tion would control both houses of
congress and could select either
Haya or Odria as president. Specu-
lation in Lima is that such a coa-
lition would select Odria--who is
acceptable to the armed forces--
as president even though he placed
only third in the voting, and
Manuel Seoane, an APRA leader, as
vice president. Odria's poor
health has led to popular specula-
tion that Seoane will succeed to
the presidency early in the six-
year term. If so, APRA--but not
Haya--will have finally captured
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CURRENT INTELLIGENCE WEEKLY SUMMARY
SPECIAL ARTICLES
CHANGES IN THE SOVIET UNION SINCE STALIN'S DEATH
The situation in the USSR
at the time of Stalin's death
in 1953 was such that important
changes appeared inevitable no
matter how the succession prob-
lem was solved. Some of the
worst aberrations of Stalin's
rule stemmed from the abnormal-
ity of the man himself and were
bound to disappear. In addition,
the country had already developed
,its productive forces in industry
and technology,and the new lead-
ers probably felt they could take
a more effective approach to ad-
ministration and control. Long-
established priorities for indus-
trial production had necessitated
an expansion of education and
training programs. This in turn
brought about a significant in-
crease in the economic wants of
the population, and public pres-
sures were beginning to force
some deference to consumer needs.
The men who took over the
direction of the country were
badly split over various aspects
of policy, but most were essen-
tially optimistic--they thought
that they knew far better than
Stalin what the major problems
were and that they could do a
better job than he in solving
them. Free of intimidation and
able to put their own ideas into
action, their mood--once the
initial shock of Stalin's death
had passed--was aggressive and
spirited. This became an im-
portant factor in determining
both the extent and the speed
of change.
Stalin's heirs, however,
were also afraid--of each other,
of the secret police, and of
the powers of Stalin's personal
secretariat. Since no one in-
dividual was powerful enough to
take complete control at the
outset, they acted in concert
to purge Beria and his hench-
mern, to destroy Stalin's sec-
retariat, and to break up the
police network and set it back
under party control. This
action necessitated the develop-
men.t of new methods of adminis-
tration and control. It paved
the way for a new system of in-
centives and emoluments, and it
permitted popular opinion to
raise its head and be heard.
As for the changes which
came about in the evolutionary
process since that time, it is
difficult to-sort the permanent
from the transitory, and it is
always possible that at least
some of the discarded techniques
of Stalinism might be reimposed.
The fact remains, however, that
the present leadership with its
new methods of operation has
been able to build a much stronger
and more viable economy and to
get a much larger segment of
the population to identify it-
self with the Communist system.
For these reasons, if for no
other, many of the trends since
1953 are likely to be enduring.
The Lifting of Terror
The new leaders' first
policy decision--to put an
end to rule by terror--involved
grave risks. Their fears of
each other and of Beria's om-
niscient secret police were
compounded by fear of how the
normally apathetic masses might
react. The precipitate lifting
of oppression might have given
rise to a wide range of politi-
cal troubles, including even the
possibility of revolt. Yet the
risks had to be run, because
nearly 35 years of fear and in-
security had stifled initiative
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CURRENT INTELLIGENCE WEEKLY SUMMARY
at all levels. It had created
a pervasive and enduring sense
of futility among the populace,
and had fostered widespread
apathy and inefficiency in the
party and government bureauc-
racies. Furthermore, Stalin's
penchant for smashing real or
imagined opposition through
the general purge had periodi-
cally deprived the nation of
many of its ablest administra-
tors.
The new leadership aspired
to make the USSR a first-rate
world power and the showplace
of international Communism. To
reach this goal the entire
economy had to expand at a rate
which was impossible to attain
under prevailing conditions.
To shake Soviet society out of
its semiparalysis, the regime
had first to provide the people
with a modicum of individual
security and with new incentives
to replace the threat of bodily
harm. So the new "collective
leadership" moved quickly to
demonstrate that terror had
been relegated to the past and
to establish firm control over
the coercive organs of power.
Three weeks after Stalin's
death the Kremlin announced a
sweeping amnesty for petty
criminals which was both a bid
for popular support and a trial
balloon to test the mood of the
masses.
The real business at hand
then got under way; the key
move was the arrest (and subse-
quent execution) of secret
police overlord Lavrenty Beria,
the sole member of the new
hierarchy to whose personal
command the secret police might
respond. His removal signaled
the beginning of the slow but
steady process of de-Staliniza-
tion which, in essence, has
meant the introduction of
regularity and rationality into
most aspects of Soviet life.
The police empire was the
next target. In the months
following Beria's arrest, his
leading henchmen were tried and
executed, many lesser secret
police officials were quietly
replaced by men drawn from
the party or the army, and in
March 1954 the secret police
organization was taken out of
the Internal Affairs Ministry
(MVI)) and re-formed into the
Committee of State Security
(KGB). The MVD was stripped
of its vast economic holdings,
and changes in the forced labor
system followed: parole was
reintroduced, discipline in
the concentration camps was re-
laxed somewhat, and living con-
ditions were improved; mass de-
portations were halted, and
forced labor in general came
to be recognized as fundamental-
ly uneconomical. The steady
attrition of MVD power con-
tinued until January 1960, when
the central MVD in Moscow was
abolished and control of the
civil police and of the "cor-
rective labor colonies" was
placed under the Ministry of
Internal Affairs in each of the
15 union republics.
Next came ,a regularization
of the Soviet judicial process.
The most reprehensible features
of Stalinist jurisprudence, such
as the doctrine of "trial by
confession," were abandoned and
the police and courts were made
to function in relatively strict
accordance with Soviet pro-
cedural law. These moves were
accompanied by a steady barrage
of propaganda designed to con-
vince the people that "strength-
ened socialist legality" made
a return to terror impossible.
Changes in the administration
of justice have not been ac-
companied by corresponding
liberalizations in the law it-
self. Soviet law has always
been a tool for enforcing the
Kremlin's will, and it was never
the intent of Stalin's heirs to
relinquish their prerogative to
determine which activities are
acceptable and which are not.
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A high degree of social dis-
cipline is still regarded as
essential to meet the goals
the Khrushchev administration
has set for itself. Although
broadened considerably since
Stalin's death, the limits of
permissible behavior are very
clearly drawn, and the individ-
ual citizen who steps out of
line is swiftly called to Ac-
count under laws and regulations
which by Western standards are
still harsh.
By putting an end to in-
discriminate terrorism, however,
the new leadership created
the internal stability on which
its plans for the nation's
development were predicted.
In an atmosphere of growing
popular confidence in the re-
gime, Khrushchev and his cohorts
lost no time in putting into
effect their ideas of how the
country should be run.
The Role of the Party and the
New Style of Leadership
One of the major develop-
ments in the post-Stalin period
was the reinstitution of the
party as the dominant institu-
tion in Soviet life. Stalin
had reduced the party machine
to but one of several inter-
acting and counterbalanced in-
stitutions of rule, which in-
cluded also the government
bureaucracy, the secret police,
and the armed forces. In the
power struggle following Sta-
lin's death Khrushchev used the
party machine as the basis for
his bid for power.
In the course of the
struggle and as a natural
consequence of Khrushchev's
victory, the party extended
and consolidated its hold
over the country to a greater
extent than ever before. Party
hegemony was re-established
over the economic bureaucracy,
the police, and the army; party
organizations have been estab-
lished in all but a small num-
ber of minor economic and social
institutions for on-the-spot
control and supervision; and
the party was given a wide range
of responsibilities in indus-
trial and agricultural admin-
istration. Managerial func-
tions have, in fact, almost
completely superseded the con-
trol function as the primary
preoccupation of most profes-
sional party workers. The net
effect is to make the party a
nearly all-embracing and perva-
sive institution.
The most striking contrast
between Khrushchev's era and
Stalin's era is the change in
the method of rule. Convinced
of the basic loyalty of the
people and alive to the stulti-
fying effects of rule by fiat
and coercion, Khrushchev has
based his rule on the use of
persuasion and incentives with
a fairly rational intermixture
of restrained discipline. In
his relations with his top
lieutenants, he has tolerated dif-
ferences of opinion and has been
willing to be influenced by points of
view other than his own. Al-
though there is little doubt
that Khrushchev can get his way
on a particular point if he
really wants it, he exercises
that power with restraint and
depends heavily on his powers
of persuasion--of which he is
obviously proud.
The same approach can be
seen in the tolerance of freer
expression among the populace.
Although the limits still are
quite restricted by Western
standards, the facade of cen-
tralized monolithic unity of
thought which Stalin sought to
project has been breached.
Stalin kept aloof from the
people, neither perceiving nor
caring about their problems or
desires; Khrushchev has culti-
vated close contacts with them
--some observers have felt that
he draws psychological strength
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CURRENT INTELLIGENCE WEEKLY SUMMARY
from such contacts--and he has
been responsive to their expres-
sions of opinion. He seems
implicitly to have recognized
that techniques of persuasion,
to be effective, must accord
with the desires and aspirations
of the people. He thus has
opened the door for the develop-
ment of true public opinion.
The third development is
the change in the composition
of the party itself. At the
time of Stalin's last party
congress in 1952, 58 out of
every thousand of the party-age
population (age 18 and over)
were members. The figure had
grown to 70 by the time of the
22nd party congress last Octo-
ber. More significantly, one
out of every eight adult men
now is a member (the proportion
among women is only one in
forty). This has meant a dif-
fusion of party spirit and a
blurring of the distinction be-
tween the party and the general
population.
By the end of the Stalin
era the party had already grown
too large to constitute a con-
spirat6rial elite with a sense
of mission. The criteria used
in selecting new members in the
post-Stalin period, however,
have resulted in the reconstitu-
tion of the party as a sort of
natural elite--or aristocracy--
in the sense that its member-
ship is almost coincident with
the upper 10 percent in Soviet
society measured in terms of
education, ability, and achieve-
ment.
The process of remaking
the party has been especially
rapid in the past few years.
Although nearly 40 percent
of the present members came in-
to the party after Stalin died,
almost two thirds of these
joined only within the past
three or four years. If pres-
ent trends continue, a majority
of the members soon will have
no party connection with the
Stalin era.
Many of the new members
are older persons who had de-
veloped careers outside the
party and joined it only after
the post-Stalin thaw. The
bulk, however, are young people,
a new generation which can
scarcely remember the war, was
but little touched by the
Stalin terror, and grew to
maturity in a period of expand-
ing contacts with the West and
the beginnings of hesitant
liberalization at home.
Changes in the Economy
The Soviet economy in the
last years of Stalin's life had,
in general, recovered from the
destruction of World War II.
Its national product was slightly
over one third that of the US,
although the Soviet population
was 30 million greater. Soviet
industry was overwhelmingly con-
centrated on the manufacture of
producer goods. Light industry
in contrast was deliberately
neglected in the allocation of
investment funds and was con-
fined largely to textiles and
shoes. In the whole of the So-
viet Union in 1950, only 1,000
washing machines were built;
series production of refriger-
ators did not begin until 1951.
Foreign trade, although several
times greater than during the
1930s, was not much above the
level reached in the immediate
prerevolutionary years and com-
prised a very small part of So-
viet economic life.
Between 1950 and 1961 the
output of goods and services
increased 100 percent while the
population increased about 20
percent, and in the latter year
Soviet gross national product
was slightly less than half that
of the US. Industrial output by
1961 had more than tripled and
the annual rate of increase
was still high--although well
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CURRENT INTELLIGENCE WEEKLY SUMMARY
below those of the late 1940s
and early 1950s. A factor in
this slowdown has been the
growing competition between
the civilian economy and the
military and space programs
for the most sophisticated re-
sources of modern technology.
Between 1950 and 1961 light
industry increased over 180 per-
cent and, although it comprised
an even smaller share of total
production, had substantially
improved the average citizen's
standard of living. In con-
trast to 1950, for example, the
USSR last year produced nearly
700,000 refrigerators and 1,250,-
000 washing machines. Foreign
trade was nearly quadruple the
1950 level, and agricultural
output had increased by about
60 percent.
Fundamental changes have
also taken place in the economic
environment. Stalin's view--
that production could be ad-
vanced by applying even harsher
penalties to the lagging worker
--had worked fairly well when
industrial processes were rela-
tively simple and. the economy
could absorb nearly everything
produced regardless of quality
or timing. As the economy be-
came more complex, however, the
need for new approaches became
more and more apparent.
Consequently, since 1953
there has been a fairly steady
shift toward incentives and away
from force. Since 1953 per
capita consumption has increased
at more than double the popula-
tion growth rate. Through a
series of price reductions,
tax adjustments, and wage re-
forms, the real wages for the
state worker have advanced by
over 55 percent.
A major improvement in the
consumer's situation was brought
about by the reduction of com-
pulsory bond purchases in 1957
and their abolishment in 1958;
less important were the gradual
abolition of the income tax
after 1957 and plans to eliminate
it by 1965. A major housing
program was undertaken in 1957,
food processing has developed
rapidly, and truck farms have
been established to supply the
cities. Programs have been
adopted to correct gross under-
investment in light industry and
to improve the quality and
selection of consumer goods.
The workweek was gradually re-
duced from 48 to 41 hours.
Pensions have been increased
and maternity leaves lengthened.
The harsh labor laws of 1940 have
been abolished, although the
internal passport system is
still in effect and a labor book
which records work experience
and reasons for previous job
transfers is still required.
Khrushchev has realized
that improvements in consumer
welfare--basic to rapid indus-
trial progress in the long run--
must start with increased agri-
cultural output. Prices paid
by the state for agricultural
products have been increased
periodically since 1953, and
agricultural taxes have been
reduced. As a result the
monetary income of the Soviet
farmer has risen sharply.
The most dramatic agri-
cultural innovation since Stalin's
death was the development of a
new grain base in Kazakhstan and
Siberia, the so-called "New
Lands." Since 1954 over 75 mil-
lion acres of virgin and long-
idle land have been plowed and
seeded to grain; despite prob-
lems of management and marginal
rainfall, the New Lands last
year provided over half of all
grain procured by the state.
Under Stalin, agriculture
had a low priority for invest-
ment resources. Rural housing
and cultural amenities were
neglected, and the need for in-
vestments in livestock facilities
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CURRENT INTELLIGENCE WEEKLY SUMMARY
and equipment for production of
row crops was ignored. Agri-
culture still receives a rela-
tively small share of total in-
vestment--about 17 percent last
year--but the amount allocated
in 1961 was over three times
greater than during 1952.
In industry, the regime's
interest in improving perform=
ance through the application
of more modern technology is far
greater than in Stalin's time,
This has led to greatly increased
trade with Western Europe as
well as to greater emphasis on
research and development and
plans for faster replacement of
old and obsolete equipment. In
many sectors of the economy,
this has led to open praise
of Western methods and their
adaptation to Soviet use--dis-I
couraged in Stalin's later
years.
Organizational changes have
been made to overcome the irra-
tionality and inefficiency which
characterized the economic system
under Stalin. Various modifi-
cations in the industrial-min-
isterial system in the direc-
tion of greater local authority
culminated in 1957 in the re-
organization of industry on a
territorial basis designed to
give greater freedom to local
managers in solving day-to-day
problems while maintaining
central control over the economy
through the planning apparatus.
In agriculture, the most impor-
tant institutional change was
the abolition of the Machine
Tractor Stations in 1958. This
action, which Stalin had re-
jected as "ruinous," permitted
the collective farms to own their
own equipment.
There have also been im-
provements in planning. Diffi-
culties are inherent in the
system, but under Khrushchev
the search for better methods
is carried out in an atmosphere
of new permissiveness and free-
dom. The economic effectiveness
of capital, mathematical methods
of planning, and the relative
roles of light and heavy indus-
try now are openly debated.
While ultimate control over
planning remains in the hands
of the top leaders, increased
planning authority has been
delegated to subordinate admin-
istrations. To facilitate the
planning process and adminis-
tration of the increasingly
complex economy, statistical
"honesty" is emphasized, and
recently promulgated laws
against account padding and
false reporting are stringently
enforced.
Changes in the Cultural Scene
The most striking change
in Soviet cultural life has been
the gradual erosion of the mono-
lithic facade of intellectual
"unanimity." Under Stalin,
the only intellectual or artistic
activities were those directed.
by the Kremlin in support of
its goals. The Khrushchev
administration, however, has
been unwilling to sacrifice its
increased respectability by re-
sorting to the harsh measures
,required to preserve this "una-
nimity," and the intelligentsia
has shown an increasing tendency
to resist the perversion of its
skills in the interests of party
dogma or propaganda. There have
been successive "thaws" and "re-
freezes" in the regime's cultural
policy since 1953, but each "thaw"
has increased the number of non-
conformist voices.
Under Stalin, the. creative
writer's sole function was to
inspire popular enthusiasm for
the regime by portraying life
in the Soviet Union as one
without flaws. Soon after
Stalin's death a few daring
writers began to portray life
as they saw it and not as the
party claimed it was. In the
shock which followed the 1956 dis-
orders in Eastern Europe, the
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regime demanded that the non-
conformist minority publicly
confess its "mistakes." A
few recanted in grudging and
ambiguous terms after six months
of pressure which included a
dramatic threat of the firing
squad from Khrushchev in person.
The majority remained silent,
but no arrests ensued. The fol-
lowing year the regime, faced
with a novelist whose forbidden
work had been smuggled out of
the USSR for publication in the
Nest, expelled Boris Pasternak
from the Writers' Union but
again did not impose a prison
sentence.
As a result of this leni-
ency, Soviet writers now are
openly divided into noncon-
formists and conformists, each
side with its newspapers and
magazines. The nonconformists'
demand for truth in literature
has produced some astonishingly
frank pictures of venal party
officials, uncommitted and cyni-
cal youth, class distinctions,
poverty, and injustice in con-
temporary Soviet society, as
well as revelations of Stalinist
tyranny. They have also ex-
plored the world of emotions,
which was forbidden under Sta-
lin and is still frowned on as
encouraging individualism in-
stead of collectivism.
The regime now tolerates
literary controversy, inter-
vening only when the arguments
encroach on overly sensitive
areas of political life. The
conformists continue to claim
a monopoly on the "correct" in-
terpretation of ideological
purity and loyalty to Communism
in literature, but their at-
tacks on their opponents are
no longer automatically backed
up with disciplinary measures
by the regime.
The attempts by the writers
to substitute their personal
visions for those of the party
have been paralleled in other
intellectual fields. The
rector of Leningrad University
recently publicly criticized
Soviet higher education on
the grounds that it taught
students to memorize facts but
failed to teach them to think
creatively. High-ranking So-
viet scientists, as well as
individual students, have taken
a similar line.
Noted physicist Peter
Kapitsa this spring warned that
Marxist philosophy alone can-
not, solve scientific problems.
He cited the Stalinist condemna-
tion of Einstein's theory of
relativity on ideological
grounds, and commented that if
Soviet scientists had listened
to dogmatic philosophers during
the past decade, Soviet achieve-
ments in space exploration would
have been impossible.
The goal of the noncon-
formists since 1953 has been
a limited one--freedom to work
with, rather than under, the
Communist party. They have
not, challenged the party's
goal of building Communism or
its right to demand their al-
legiance to that goal. They
only wish to describe their
socialist society accurately,
not to reorganize it. Ob-
jectivity in description of
the results of policies re-
flects criticism of the policies
themselves, however, and inde-
endent thought cannot be quaran-
~tined in literature and science
alone. So long as the regime
is reluctant to reimpose Stalin-
ist controls over intellectual
activity, it will continue to
face challenges to its claims
of intellectual omniscience,
and the areas in which it re-
serves to itself the exclusive
right to discuss and criticize
will continue to erode.
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