WEEKLY SUMMARY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00927A009100020001-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 32
• Document Creation Date: December 21, 2016
• Document Release Date: April 6, 2009
• Sequence Number: 1
• Publication Date: September 17, 1971
• Content Type: SUMMARY

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Ifte Secret
DIRECTORATE OF
INTELLIGENCE
WEEKLY SUMMARY
State Dept. review completed
NAVY review
completed.
Secret
17 September 1971
No. 0388/71
Copy N4
44
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CONTENTS
(Information as of 1200 EDT, 16 September 1971)
Indochina
South Vietnam: A Referendum for Thieu . . . . . . . . . . . . . . . . .
Cambodia: The War Winds On . . . . . . . . . . . . . . . . . . . . . . 2
n onesia: Accent on Economic Progress . . . . . . . . . . . . . . . . . . . 5
Major Strides in Sino-Burmese Relations . . . . . . . . . . . . . . . . . .. 6
Burma: We'll Handle Our Drug Problems Ourselves . . . . . . . . . . . . . . . 7
26th UN General Assembly Opens . . . . . . . . . . . . . . . . . . . . . . 8
International Economic Developments . . . . . . . . . . . . . . . . . . . . 9
USSR: Good Harvest, but Grain Problems . . . . . . . . . . . . . . . . . 10
NATO Allies Prepare to Move Toward Security Conference . . . . . . . . . . I1
Malta: Mintoff Is Still Negotiating for Foreign Aid . . . . . . . . . . . . . . 12
Berlin: Second Phase of Talks Stalled . . . . . . . . . . . . . . . . . . . 13
Soviet Ships Show Flag Near US Territory . . . . . . . . . . . . . . . . . . 13
Soviets Stepping Up Research in Antarctica . . . _ . 15
Polish Leadership Campaigns Against Corruption and Crime . . . . . . . . . . 17
Denmark: Parliamentary Election Likely to be Close . . . . . . . . . . . . . 18
MIDDLE EAST - AFRICA
India-Pakistan: Whether or Not to Invade . . . . . . . . . . . . . . . . . . 20
Middle East Developments . . . . . . . . . . . . . . . . . . . . . . . . 21
Ghana: Government Moves Against Labor Federation . . . . . . . . . . . . 22
Bolivia: Banzer's Problems Persist . . . . . . . . . . . . . . . . . . . . . 23
Chile: Dissension Inside and Outside of the Government . . . . . . . . . . . 24
Uruguay: Angry Rhetoric and a Promise of Action . . . . . . . . . . . . . . 25
Venezuela Moves Toward Andean Pact . . . . . . . . . . . . . . . . . . . 26
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FAR EAST
Indochina
President I hieu's plan for a referendum on
his policies in place of a contested presidential
election is drawing the heaviest and most wide-
spread criticism he has yet faced. Even some
political figures who have been friendly to Thieu
believe that the President's recent tactics have
been unwarranted and have hurt the country.
The Communists also are watching the po-
litical situation closely, and there are indications
they have some hope that dissension within the
ranks of the non-Communists will eventually
cause a collapse in Saigon. Opposition to the
President, while widespread, is nonetheless still
25X1 far from united, and those hoping to force Thieu
to change his course face formidable obstacles.
I h e heightening tension in Saigon was
underscored late in the week when the powerful
An Quang Buddhist sect, which has helped bring
down governments in the past, announced that it
would call for a boycott of Thieu's 3 October
One factor still contributing to stability is
the loyalty of most leading generals. Thieu knows
that his position ultimately rests largely on their
support, and he has taken special pains to reward
many of them and keep them in his camp. Big
Minh has a following in the army, but since his
withdrawal from the presidential race he has
shown little disposition to become involved in
opposition activities. Ky's support among the
military is limited, but his capacity for forceful
and dramatic action-possibly with the help of air
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force elements over which he still retains some
control-cannot be discounted.
The most likely sources of popular support
for activist opposition to Thieu in coming days
are among student and veteran groups. The
students in Saigon have been particularly aroused
by the election developments, and they are prob-
ably responsible for the recent rash of fire bomb-
ings of US vehicles in Saigon. There already have
been a number of self-immolations by veterans.
Even though student leadership is divided and the
Thieu government has reached out to meet some
veterans' grievances, more fire bombings, immola-
tions, and demonstrations are likely.
The ability of Thieu's opponents to mount
an effective challenge against him probably de-
pends mainly on whether they can work in
coordination with one another-no small task
because their interests and objectives are so dif-
ferent. The Buddhists, students, veterans, and
various political factions usually think mainly in
terms of their own causes and are naturally
suspicious of each other. In order for these groups
to unite behind any single opposition leader, that
leader must speak out in a way that will draw
them together. No one has yet been able to do
this, but it is clear that Ky will be trying hard in
coming days to find slogans for rallying support.
Thieu's opponents will be taking an especially
hard look at the modalities of the coming referen-
dum to see if they provide any meaningful way to
express and register dissent. Any "mistakes" by
Thieu-for example, any moves that might make
his regime appear more authoritarian or repres-
sive-could give impetus to a more unified -op-
position movement.
The Communists have offered little re-
sistance to the 15,000-man South Vietnamese
drive-dubbed Larn Son 810-into western Quang
Tri Province, but numerous enemy weapon and
munition caches have been uncovered since the
push began on 6 September. There is no hard
evidence that they plan to send units across the
DMZ to counter the South Vietnamese operation.
Elsewhere in South Vietnam, other enemy units
are preparing for activities to disrupt the up-
coming presidential election, but most prepara-
tions are in low key and do not appear to include
plans for large-scale attacks.
Flood waters in North Vietnam appear to be
subsiding, allowing the government to proceed
with relief and recovery measures. The large
10th-month rice crop has probably been heavily
damaged, and some industries have been at least
temporarily disrupted. There is no indication,
however, of heavy loss of life.
The government is providing material aid to
stricken communities, including free food to
flood victims, materials, seeds, and fertilizer. The
Chinese and the Soviets, taking advantage of the
opportunity to show their solidarity with the
Vietnamese, already are delivering construction
supplies and equipment. Increased deliveries of
food can be expected as relief measures use up
domestic food stocks.
The tempo of military action increased dur-
ing the week as Communist forces reacted to
Cambodian Army (FANK) operations in several
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sections of the country. Some of the sharpest
fighting of the rainy season was reported in south-
ern Kompong Thom Province. Elements of the
government's Chenla II task force, which previ-
ously had met surprisingly light enemy resistance
in clearing Route 6 between Tang Kouk and
Kompong Thmar, took some sizable losses as a
result of Communist ground attacks near the lat-
ter town. The Cambodians were also badly
mauled on Route 5, south of Kompong Chhnang
city; a security sweep there lost at least 46 killed
and 51 wounded during a series of encounters
with enemy troops. The enemy attacks in this
area probably were designed to help disrupt rice
convoys between Battambang and Phnom Penh.
The convoys have only recently been resumed
after repairs to a bridge on Route 5 that the
Communists destroyed late last month.
Despite such reverses, however, Phnom Penh
showed no signs of reducing its determination to
maintain some military momentum against the
Communists. East of Route 6, for example, Cam-
bodian forces have continued to advance up
Route 21 toward several rubber plantations in
Kompong Cham Province that long have served as
enemy base areas. Early in the week, four bat-
talions moved unopposed into the town of Bos
Khnor, which had been held by the Communists
for many months. After resting a few days, the
battalions apparently will resume their push
north. It is not certain if they intend to try to
clear Route 21 all the way to its junction with
Route 6. The Communists probably would
strongly challenge such a move.
Elite Khmer Krom units evidently have
moved closer to a semiautonomous status within
the Cambodian Army. Prime Minister Lon Nol
has authorized the formation of a high-level
Khmer Krom (KK) "committee" to coordinate
and oversee Khmer Krom military affairs. The
committee is headed by a prominent KK civilian,
551875 9-71 CIA
but all other key positions are held by KK com-
manders. The committee's organization parallels
that of the Cambodian Army headquarters and
presumably is meant to supplant the latter as a
staff organization for some 14 KK infantry
brigades in the courtry.
The committee's establishment appears to
have been prompted by the concern of KK of-
ficers over what they viewed as serious short-
comings in the army's use of their units. Their
grievances have included a lack of operational
planning, poor logistical support and the failure
to clamp down on corruption.
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The establishment of the committee appears,
however, to be a step backward from the govern-
ment's half-hearted efforts to integrate the KK
fully into the Cambodian Army. It is not yet clear
how the new KK organization will operate in
practice, or how it will relate to army head-
quarters, particularly in supply procurement.
There has been a minimum of difficulty so far
between the KK and the army's top echelon,
which appears to have subordinated questions
about the KK's political loyalties to the realiza-
tion that the KK units are Cambodia's most effec-
tive fighting force.
It is not yet clear who took the initiative in
setting up the new committee, but Lon Nol prob-
ably estimates that by giving KK units such a
wide measure of military independence he has
ensured the retention of their political support.
Laos: Capture of Paksong
Government forces have captured Paksong
on the Bolovens Plateau. Elements of two ir-
regular battalions moved into the town on 15
September. The irregular troops are part of a
larger government task force that, with artillery
and air support, has been pushing toward Paksong
since it was airlifted to positions three miles from
the town on 11 and 12 September. By midday of
16 September the troops had cleared enemy
forces from nearly all of Paksong after some
tough house to house fighting. The government's
next step presumably will be to try to link up
with other government battalions that have been
attempting to advance to Paksong along Route 23
for the past seven weeks. Paksong, the com-
mercial center for the Bolovens Plateau area be-
fore its loss to the Communists in mid-May, is an
1874 9,-71 CIA 25X1
important road junction, and its capture will give
Vientiane a welcome psychological boost.
Vang Pao's irregulars have launched a limited
offensive operation to improve their defensive
posture before the end of the rainy season. The
irregulars are trying to capture strategic high-
ground positions north of the Plaine des Jarres.
Units advancing north from near Route 74
encountered only light resistance as they moved
on to several small hills, but they are likely to run
into tougher resistance near Phou San, which was
lost to the Communists in late August. Aerial
observers report that the North Vietnamese there
have built many new field fortifica-
tions. F_ I 25X1
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Indonesia: Accent on Economic Progress
President Suharto's postelection cabinet re-
shuffle, announced on 9 September, reflects the
enhanced prestige of civilian technocrats, the de-
creased influence of political parties, and the gov-
ernment's determination to continue its priority on
economic development. Despite the appearance of
enlarged civilian responsibility, however, the Indo-
nesian Army continues to hold predominant and
ultimate power. Indeed, the role of political parties
in the cabinet has been reduced to the bare
minimum; each of the three largest-National Party,
Nahdatul Ulama, and Muslim Party-has only a
single representative in a relatively insignificant
post.
Suharto created a new portfolio of develop-
ment planning for Widjojo, the able director of the
National Planning Board who will continue to serve
concurrently as head of that body. Three other
economists on Widjojo's team have also been given
cabinet posts; two replaced ineffective military
men, and the other replaces an ailing civilian
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bJ uKJ 1
politician. Five of the 24 ministers are military, a
decrease of one.
Of potential importance domestically is the
assignment of the Ministry of Religion to Mukdi
Ali, an apparently moderate Muslim who heads one
of the member organizations of Golkar, the govern-
ment's quasi-political party that won over 60 per-
cent of the elected seats in the July parliamentary
elections. His appointment appears to be a move
toward ending control of the ministry by the cor-
rupt and traditionalist Nahdatul Ulama. If Mukdi
Ali is able to bring some semblance of efficiency
and new thinking into his department, which
reaches grass-roots levels through the Muslim school
system, this change alone could help move some of
the population into the twentieth century.
One other potentially important change is the
elevation of General Panggabean, the deputy com-
mander of the armed forces, to ministerial rank as
assistant to Suharto. For the time being, Pangga-
bean's assignment seems to clarify his position as
the second-ranking military man after Suharto. It
may also presage his appointment as defense minis-
ter if Suharto decides to relinquish that portfolio.
Domestic reaction to the cabinet reshuffle has
been favorable. Youth leaders in particular, who
have been the principal gadfly of the Suharto ad-
ministration, have expressed their surprise and
pleasure at the increased expertise of the cabinet.
Other government critics have come reluctantly to
realize that the Suharto administration is the most
effective and progressive government in Indonesia
in 22 years of independence.
Major Strides in Sino-Burmese Relations
Prime Minister Ne Win's sojourn to China a
month ago has generated substantial progress to-
ward resolving key issues separating China and
Burma. Furthermore, the likelihood that he will
return to Peking as a featured guest for the Chinese
National Day celebrations on 1 October is added
testimony that Sino-Burmese relations have nearly
reached the high-water mark of pre - Cultural
Revolution days.
The most significant result of the August visit
was an agreement between Ne Win and Premier
Chou En-lai that Rangoon would initiate a dialogue
with Burmese Communist Party (BCP) leaders who
are currently in China. Ne Win has already selected
an emissary to meet BCP representatives in Peking
this fall. Chinese support to the Burmese insurgents
is the major outstanding issue between Peking and
Rangoon as far as the Burmese are concerned.
Chou's intentions appear to be to maneuver the
insurgents into a phase of less inflammatory anti-
government activity and thereby create a situation
that would help protect Peking's diplomatic-and
ideological-flank.
Chou and Ne Win also made progress on the
sensitive issue of the status of Overseas Chinese in
Burma. Cl:ou apparently assured Ne Win that Pe-
king would no longer foster close ties with Chinese
communities abroad, and as a result Rangoon has
relaxed its restrictions on the activities of local
Chinese. Ne Win apparently also agreed to pay
compensation to local Overseas Chinese for losses
suffered during the anti-Chinese riots in 1967. This
had been a major bone of contention and had been
one of the original demands Peking made on the
Burmese Government before normalizing relation S25X1
Once lingering bilateral differences are satisfactorily
ironed out, a new Sino-Burmese friendship and non-
aggression agreement may also be in the off-
ing. 25X1
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Burma: We'll Handle Our Drug Problems Ourselves
Prompted by growing international attention
to the drug problem, the leaders in Rangoon have
been unusually forthcoming to US approaches
concerning the control of narcotics traffic in
northeast Burma. Nevertheless, in recent talks
with US officials the Burmese have made it clear
that there are limits to how far they are willing to
go and that Burma still holds to its long-standing
isolationism.
Burmese officials have recently emphasized
their determination to attack the domestic opium
NORTH
VIETNAM
*Hanoi
production problern with a minimum of out-
side assistance or interference. Burma is willing
to exchange information with the US on
trafficking and refining, but it has rejected any
involvement in international action. The
Burmese have argued that joint efforts with
Thailand and Laos to eliminate trafficking in
the triborder area would present olitical rob-
lems,
The Burmese have on occasion confiscated
opium in transit to transshipment points on the
Thai border and have periodically closed down
refineries in the border town of Tachilek. Bur-
mese Government access to the Shan states area
east of the Salween River, where much of South-
east Asia's opium is produced, is restricted, how-
ever, by Communist and ethnic insurgents who
are active there. The area's proximity to China
also makes the Burmese sensitive to any proposal
that calls for third country activities. Rangoon is
obviously reluctant to arouse Chinese suspicions
and endanger the considerable improvement in
Sino-Burmese relations that has resulted from
General Ne Win's recent visit to Peking.
Rangoon
'angkok
CAMBODIA
Phnom
Penh_,- 1
? Major refinery concentrations
.ac
Miles
Saigon
Opium growing area
Despite Rangoon's freshly stated misgivings,
it has still come a long way from the days when
any cooperative effort with the US was ruled out.
Sensitivity to international publicity about Burma
as the source for much of the opium that is fed
into world markets, plus awareness that the prob-
lem cannot be tackled singlehanded, may even-
tually prod Rangoon into greater participation in
multinational control efforts.
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EUROPE
26th UN General Assembly Opens
The upcoming General Assembly session, ex-
pected to be highlighted by the voting on Chinese
representation, will probably be the most acri-
monious in years. From the heated debate, how-
ever, there may emerge an organization more re-
flective of changing international power relation-
ships.
The China issue is not expected to be
brought to a vote before the end of October.
Nationalist supporters are preparing resolutions
making expulsion of Taipei possible only by a
two-thirds vote and calling for dual representation
(DR), while opponents have already submitted a
resolution calling for Peking's admission and the
expulsion of Taipei. Neither side, however, has
yet secured a decisive number of votes, and many
states will remain uncommitted until the last
moment.
The second focus of attention will be the
selection of a successor to Secretary General
Thant. Although Thant reiterated this week that
he has no desire to serve again, the Soviets, who
are satisfied with his generally passive attitudes
toward the role and prerogatives of the office,
may still seek to dissuade him. Finnish UN dele-
gate Max Jakobson enjoys influential Western
backing and reportedly Peking's endorsement, but
his candidacy rankles Moscow. The Soviets appear
troubled by Jakobson's writings in defense of
Finnish neutrality, his strongly independent
stance reminiscent of Dag Hammarskjold, and his
Jewish background. In the event of an impasse,
the leading potential compromise choices are
Ceylonese delegate H. S. Amerasinghe, Austrian
delegate Kurt Waldheim, UN Middle East envoy
Gunnar Jarring, and Prince Sadruddin Aga Khan,
the UN high commissioner for refugees.
The Assembly appears certain to deal with
the Middle East and South Asian crises and pos-
sibly with the situations on Cyprus and in North-
ern Ireland. As usual, the Arabs may use the
Assembly, whose resolutions are not binding, to
push through controversial statements on ways of
resolving their conflict with Israel. A heating up
of the Indo-Pakistani dispute, the strong potential
for famine conditions in the subcontinent during
the session, and the impact of Peking's possible
entry into the UN could make South Asia a focal
point of Assembly debate.
Disarmament may be another key area of
concern. Although the superpowers' draft conven-
tion curbing biological weapons appears headed
for relatively smooth sailing through the As-
sembly, the nonaligned members-abetted by the
environmental concerns of Canada and Japan-are
likely to push hard for a comprehensive nuclear
test ban (CTB) this fall. Sweden recently offered
a draft CTB treaty that would attempt to resolve
the thorny issue of verification by calling for
"good faith cooperation" in international seismic
exchanges. The nonaligned may also find appeal-
ing last week's Soviet initiative for a world dis-
armament conference.
The Assembly session will almost certainly
again demonstrate its utility as a forum for the
airing and, in some cases, easing of grievances. In
certain areas, such as the Middle East and South
Asia, UN discussions may exacerbate immediate
problems, but prospects are that the meeting will
show once more that there are still international
concerns that the UN alone is equipped to ad-
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International Economic Developments
The meeting of the finance ministers of the
Group of Ten, that ended yesterday in London,
highlighted and increasingly unified opposition
among the Europeans, and the Japanese, to the
recent US monetary and trade measures.
Earlier in the week, the European Com-
munities' finance ministers agreed on what may
be an initial bargaining position for international
monetary reform. A set of recommendations was
presented to the Group of Ten meeting and re-
ceived strong British support, as well as the gen-
eral informal backing of Canada and Japan. The
recommendations call for a devaluation of the
dollar as part of general currency realignment, a
widening of currency fluctuation margins, and
greater use of Special Drawing Rights in the crea-
tion of new international reserves. The EC minis-
ters were also united in their call for the prompt
removal of the US 10-percent import surcharge as
well as cancellation of proposed tax benefits re-
stricted to domestic US investments. They con-
tend these measures make a realistic adjustment
of exchange rates an impossibility. The EC minis-
ters' appeal received strong support from the
other Group of Ten members and it is possible
that they will insist on such actions before agree-
ing to a general currency realignment.
UN: The UN comptroller this week reported that
the organization was barely able to meet its mid-
month payroll and cannot honor its end-of-the-
month obligations without substantial contribu-
tions from the member states. He believes
Secretary General Thant may have to impose
arbitrary restrictions on UN programs, although
Thant probably would be reluctant to do so with-
out the General Assembly's approval. This devel-
Although the EC pulled together on the
question of monetary reform, the Six have been
unable to come up with a common exchange rate
policy. Currently, they are standing pat with their
present national exchange rate schemes. In part,
this reflects some ssatisfaction with the workings
of the various floating and dual-rate systems. The
EC Commission has warned, however, of the po-
tentially dangerous consequences for intracom-
munity trade in general, and the common agricul-
tural policy in particular, if a joint exchange rate
policy is not established. Nevertheless, the Six are
likely in the immediate future to stress unity on
broad principles for international monetary re-
form, while side-stepping the more sticky prob-
lem of reconciling French-German differences
over exchange rate changes. Some of the EC
countries remain worried, however, about the po-
litical consequence-, of hardening European atti-
tudes against the US economic measures. The
Germans, in particular, have expressed the hope
that a confrontation could be avoided by the US
re-emphasizing its devotion to liberal trade
policies.
In a related development, the joint call for a
dollar devaluation triggered the purchase of
strong currencies, particularly the German mark,
which at midweek has appreciated to a post - May
1971 high of 8.8 ercent over parity,
opment is certain to exacerbate the usual Assem-
bly debate on budgetary problems, already
heightened this year by the threat of staff em-
ployees to engage in strike action unless they win
a 15-percent pay boost. UN deficits stem in large
measure from Soviet and French refusals to pay a
number of past assessments for peace-keeping
missions, particularly the Congo operations of the
early 1960s.
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OL' vier, I
USSR: Good Harvest, but Grain Problems
Despite indications that the quantity of
grain harvested this year may fall just short of the
previous record, insufficient reserves of bread-
grains may increase Soviet requirements for grain
imports. This situation arises because of a sharp
increase in the use of wheat as livestock feed, a
higher level of dependence of East European and
other client states on Soviet grain, and physical
deterioration of some grain reserves, making them
unsuitable for human consumption.
If normal weather conditions prevail during
the balance of the harvest, 1971 grain production
is expected to fall midway between the record
crop of 150 million tons in 1970 and the 135-
million-ton average for the last five years. The
completed harvest of winter grains, that normally
account for about 36 percent of production,
appears to have reached last year's record level.
Because of lateness in ripening and harvesting, the
outlook for spring grains remains uncertain. By 1
September only about 60 percent of the total
grain acreage had been harvested, compared to a
long-run average of 70 percent. If, as often
happens, weather conditions rapidly deteriorate
by the end of September, there could be a reduc-
tion in the harvest below the present forecast.
FINLAND: President Kekkonen's proposal on 11
September to establish diplomatic relations with
both Germanies may have been prompted in part
by Helsinki's desire to win Soviet approval for
future commercial arrangements with the Euro-
pean Communities. The gesture, which includes
identical draft treaties for Pankow and Bonn,
appears to have been initiated entirely by the
Finns and not at Soviet behest. The Finns may
hope to impress the Soviets with a move that
gives equal treatment to East and West Germany.
There are aspects of the proposal, however,
that are unacceptable to either of the Germanies.
Even with a good harvest, it appears that the
Soviets will face problems because reserves of
wheat suitable for breadmaking are low. Soviet
grain reserves, earlier placed at half the annual
foodgrain requirement, now have been reduced,
reflecting the use of greater amounts of grain as
seed and the deterioration of some grain through
improper storage. In addition, an official cam-
paign to alleviate domestic meat shortages has led
to increased use of wheat as feed. For example, in
1970 the amount of wheat fed to livestock was
three times the normal rate, seriously adding to
the reduction of buffer stocks.
If bad weather interferes sufficiently with
the rest of the current harvest, the USSR could be
in the market for more imported grain. Moscow
already has contracted for four million tons to be
delivered in the year ending June 1972, about
twice the average annual imports for the 1967-70
period. Nevertheless, because of pressures to meet
traditional commitments to client states, the
Soviets are ex ected to remain net exporters of
grain.
Although the East Germans appear delighted at
the prospect of recognition by a West European
country-an anathema to Bonn-the draft treaty
calls for reparations from Bonn and Pankow for
German-caused destruction in Finland during
World War II. This aspect of the proposal, which
contradicts East Germany's policy of shunning all
responsibility for Nazi excesses, suggests the
Finns hoped to make the stakes too high for early
acceptance by either country.
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NATO Allies Prepare to Move Toward Security Conference
The Western allies appear willing to wait
until all three stages of the Berlin agreement are
concluded before moving to multilateral prepara-
tions for a Conference on European Security.
They generally assume, however, that by Decem-
ber, when the NATO foreign ministers meet in
Brussels, the Berlin accord will have been con-
cluded or will be far enough advanced to enable
them to authorize multilateral moves toward a
security conference.
The success of the four-power phase of the
Berlin talks has relieved much of the tension
within the Alliance over NATO's insistence that a
Berlin accord precede any conference prepara-
tions. The allies view a security conference with
varying degrees of enthusiasm, but they all realize
that they must now work out a consensus on
what kind of a conference they prefer and what it
would seek to accomplish.
There is substantial agreement that at a con-
ference on European security the West should
press for liberalization in Eastern Europe. The
allies will attempt to undercut the "Brezhnev
doctrine" through a strong reaffirmation of the
principles of sovereignty and territorial integrity
of all European states. The Soviets will also be
challenged to permit freer movement of persons,
ideas, and information in the bloc. In addition,
the allies intend to promote broader East-West
cooperation in environmental and trade matters.
In the latter area, the members of the European
Communities (EC) are discussing whether the
Communities should be represented at such a
security conference. All but the French now favor
Community participation in order to promote
direct dealings between the Communist states and
the Community as a unit.
Prior to the ministerial, the allies may have
sharp differences over two competing concepts of
conference procedures. Many of the allies, in-
cluding the US, currently favor low-level East-
West discussions leading up to the conference,
possibly in late 1972. The West Germans par-
ticularly desire methodical preparations, pre-
ferring that the conference itself be held after
they reach a modus vivendi with the East Ger-
mans on UN membership for the two states. Paris,
however, probably will continue to argue for an
initial high-level conference-possibly in early
1972-followed by working-level sessions, and
finally a second security conference at which any
agreements reached earlier would be ratified.
Some allies find the French position attractive
and the question may have to be left for the
ministers to discus~i.
The relationship between a Conference on
European Security and Mutual and Balanced
Force Reductions (MBFR) remains a tricky ques-
tion for NATO, particularly because of French
opposition to MBFR. Many allies believe that a
security conference and force reduction nego-
tiations should develop in parallel, thus ensuring
that "cooperation"-the major ingredient of
Soviet conference proposals-is accompanied by
measures dealing with "security." Although none
of the allies believes it feasible to negotiate force
reductions at a security conference, some feel it
might be possible to relate the two in some less
integral fashion. Moreover, any security con-
ference umbrella for force reductions, while not
resolving French concerns about the dangers of
such reductions, might moderate France's
ideological objection to MBFR as a perpetuation
of the bloc-to-bloc system in Europe.
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V 1~tJ 1\ L 1
Malta: Min toff Is Still Negotiating for Foreign Aid
Over the past several months, Prime Minister
Mintoff has improved his country's prospects for
external financing from a variety of sources by
taking a more independent stance on foreign
policy. Final conditions for aid, the amounts, and
even the contributing countries concerned, how-
ever, are still under discussion.
Relations with the United Kingdom have
been increasingly acrimonious, but both sides still
seem to expect an eventual agreement on new
defense and financial arrangements. The NATO
countries have put together a package of almost
$24 million a year for the British to offer
Mintoff. Malta's over-all budget totals only $111
million for the 1971 fiscal year. Mintoff ap-
parently realizes that NATO's offer is unlikely to
go any higher, and he now wants to know what
individual NATO countries are willing to offer on
a bilateral basis.
inclined to offer a substantial amount in sub-
sequent bilateral aid.
Mintoff and his Labor Party have been
antagonistic to Italy, which has been associated
with right-wing forces on Malta. Rome is espe-
cially interested in the Mediterranean, however; it
has pledged its contribution to the UK-NATO
package and is tentatively thinking of $5 million
in additional aid to Valletta over a five-year pe-
riod. Bilateral aid to Malta is also under considera-
tion in several other NATO capitals.
Outside the Western camp, Mintoff has ap-
parently had success, primarily in Tripoli. Libyan
aid appears thus far to be restricted to an emer-
gency loan of between $3 and $5 million.F
Negotiations with Moscow have been limited 25X1
by Mintoff's long-standing determination to avoid
a close relationship with the USSR. Nevertheless,
following nonresident Soviet Ambassador
Smirnovsky's second visit to Valletta this sum-
mer, Moscow has announced that it has a "favora-
ble attitude" toward giving economic assistance
to the island and that Soviet merchant ships will
use Malta's drydocks for repair.
Mintoff apparently hopes to obtain enough
development aid from the variety of foreign
sources available to make his country economi-
cally independent within the 1970s. He faces
serious hurdles on the domestic front, however,
even if his quest for foreign aid is successful.
Despite his leadership of the Labor Party, Mintoff
has not been able to eliminate strife in the dock-
yards, Malta's most important industrial asset. On
the contrary, the dockworkers have undertaken a
wildcat work slowdown to implement their
demands for a say in the management of the
Malta's warmest relationship appears to be
with West Germany. The Germans, although
becoming impatient in recent weeks with Mintoff,
have contributed to the NATO package and are
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Berlin: Second Phase of Talks Stalled
After three "negotiating" sessions between
East and West German officials and between East
German and West Berlin representatives, the in-
ter-German phase of the Berlin talks has stalled.
Pankow has refused to adhere to the German text
of the quadripartite treaty earlier agreed to by
both German states. It has also attempted to shift
negotiations on the transit of West Berliners to
West Germany from the East-West German forum
to the East German - West Berlin forum. By these
tactics, Pankow hopes to loosen the ties between
West Berlin and West Germany acknowledged by
the four-power accords and to strengthen East
Germany's contention that West Berlin is a sep-
arate political entity.
The East Germans have not simply resorted
to intransigence; they have loaded the negotiating
tables with draft treaties and agreements. At the
same time their media is flooded with statements
proclaiming readiness to bring the talks to a swift
conclusion and decrying alleged West German ob-
structionism. By posing as the more "reasonable"
partner in the inter-German talks, Pankow hopes
to gain international support for its claim to equal
status with West Germany. Furthermore, by res-
urrecting the broader issues already settled by the
four powers, Pankow wants to underscore its
claim to sovereignty that was overridden during
the four-power phase of the talks.
The East German position has posed a
dilemma for the West Germans. They are eager to
wrap up the inter-German talks in a matter of
weeks, although apparently not at the cost of
acknowledging East German legal conceptions or
of encouraging further chicanery by Pankow.
Bonn, therefore, apparently hopes a firm stance,
as evidenced by its unwillingness to pursue sub-
stantive discussions pending a settlement of the
textual issue, will bring pressure to bear on the
East Germans.
In addition, Chancellor Brandt, during his
meeting with Brezhnev at a Black Sea resort on
16-18 September, is almost certain to seek Soviet
help in moving the inter-German talks forward.
Brandt also is expected to sound out the Soviets
on prospects for bilateral trade, cultural, and
commercial air agreements. The early conclusion
of such pacts would contrast sharply with East
Germany's foot-dragging tactics and would
dampen the critical fervor of opposition Christian
Democrats, who are always eager to exploit any
slackening in the pace of Ost olitik.
Soviet Ships Show Flag Near US Territory
An eight-ship Soviet task group continues an submarines, two guided missile destroyers, a sub-
extended North Pacific deployment that includes marine tender, and a tanker.
operations in areas close to US waters. The
deployment from Petropavlovsk began in late
August and has been highlighted by operations in
the Gulf of Alaska and in the vicinity of Hawaii.
A guided missile light cruiser is the flagship of the
group that also includes a nuclear-powered cruise
missile submarine, two diesel-powered attack
The ships deployed northward from Petro-
pavlovsk about 25 August in two groups. The
tender and two F-class attack submarines trans-
ited north of the Aleutians while the surface
group passed to the south. After rendezvous, the
task group moved into the Gulf of Alaska to
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conduct basic ASW, task group, and helicopter
operations. During the transit and while in the
Hawaiian area the Soviet ships have conducted
various task group operations. They were located
about 30 miles south of Honolulu, before begin-
ning the return transit to home waters on 14
September.
This is the first deployment of Soviet surface
combatants so close to the Hawaiian Islands, al-
though two guided missile destroyers operated for
a month in mid-1966 near the western reaches of
the Hawaiian Island chain. The two destroyers
may have been supporting space operations at
that time.
The mission and length of deployment of
the current task group remains undetermined.
Thus far, all exercises could have been performed
in the normal Soviet naval operating areas in the
western Pacific. The significant aspect of the de-
ployment seems to be that the Soviets chose to
conduct these exercises in areas close to US terri-
tory and far from their own waters. Thus, the
deployment seems to be both a demonstration of
the maturity of the Soviet Pacific Fleet and an
exercise in "showing the flag."
74
~''N e[ 1.' s mil
yr' ?'4'%4
?~, ; "J4
ALEUTIAN
MO
SYSSAL pU
eV
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Soviets Stepping Up Research in Antarctica
The Soviets are preparing their largest ex- geodesy, marine biology, glaciology and geo-
pedition to the Antarctic since beginning research magnetism.
there in the mid-1950s. The program announced
for the expedition is a further expansion of the
Soviet effort to explore the Antarctic for scien-
tific and military purposes-an effort that has
doubled since 1967.
The seventeenth Soviet Antarctic Expedition
is scheduled to begin in late October and will
involve 420 scientists and technicians. During this
expedition, the Soviets plan to begin preliminary
work for establishing their seventh permanent re-
search station, giving them the most extensive
coverage of any country studying the Antarctic
environment. The Soviets also plan several field
programs during the expedition, including a
geological and geophysical study of the Prince
Charles Mountains. In addition, they will attempt
two long traverses-one a joint effort with the
French from Dumont d'Urville to Vostok utiliz-
ing US air support.
The new Soviet program calls for the con-
tinuation of research in several scientific fields. A
wide range of basic meteorological and geo-
physical observations has been regularly con-
ducted at all stations. The collection of meteor-
ological data is facilitated by the use of small
sounding rockets launched from the Molo-
dezhnaya station. Oceanographic research has also
been an important part of the program and is
being increased. New or expanded research pro-
grams will be conducted in radio communica-
tions, space medicine, surface and satellite
As Soviet research has been expanded,
monitoring Soviet activity has become more diffi-
cult despite a 12-nation treaty that requires an-
nual written reports on all Antarctic explorations.
In recent years, the Soviet reports have provided
incomplete information on several categories of
activities and have omitted completely the names
of the scientists who participate in the summer
programs. The Soviets normally have submitted
these reports well after the time specified in the
treaty and have ye : to provide the US with one-
due last November--on their sixteenth expedition.
In addition to these reports, the signatory nations
have the right to visit each other's research sta-
tions. In this connection, the US has sent one
scientist to work at a Soviet station each year and
the Soviets have reciprocated. The US supple-
ments these exchanges by inspections of one or
two Soviet stations every three or four
years.
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St;I:Kt l
SOUTH
GEORGIA
(U.K.)
CAI IKE AND IS
(U.K.)
ARGENTINA
SOUTH
ORKNEY
ISI ANDS
Bellingshausen
0
SOUTH
SHETLAND e
LANDS
SOUTH
SANDWICH
ISLANDS
(U. K.)
Soviet Antarctic Activities, 1971-2
o Soviet station
? US station
0Novelazarevskaya
0Molodezhnaya
CHILE Palme , re Ghatlea
?Sle South Pole?
(Su mB1
Byrd
New station =' _
(App-loo t. Io Catin)-.6
Hallett*
(Joint us-111Z. SofHnoO'0.,,, ? _
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Prl M0ufl ..~--Field program
area
Mirnyy
Traverse t
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SLUKV,1
Polish Leadership Campaigns Against Corruption and Crime
The Polish regime, with party leader Gierek appears to be an attempt to instill in the populace
in the forefront, has launched an intensive drive an awareness of the need for over-all improve-
against corruption at all levels of the bureaucracy, ment in administrative efficiency and moral
but with particular emphasis on the decay in local standards, if Gierek's program of "national re-
party organizations. The campaign has a message newal" is to be realized.
for all elements of Polish society, however, and
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Local party plenums are screening out those
party officials and rank-and-file members who are
unwilling or incapable of implementing Gierek's
programs. Thousands of members have been
dropped from party rolls for passive attitudes or
their inability to respond to the workers' needs.
Although passivity seems to be the cardinal sin,
other offenses have been aired in the press.
The main party daily, Trybuna Ludu re-
cently admitted that the party had been "invaded
by people who use their membership for private
ends." The article said the current review of party
ranks was designed to ferret out such "careerists"
who join to secure connections. The daily cited
cases in which members used positions of influ-
ence to establish criminal networks that embezzle
"socialist property." The expose stressed that
these "syndicates" operated successfully only be-
cause there was a "collusion of silence" among
corrupt party members. It was noted, for ex-
ample, that in some provinces very few members
are reprimanded or dismissed from the party even
after they have been sentenced to prison terms.
Character-building lectures, however, have
not been addressed solely to party members. An
extensive crackdown is under way against all
those who have violated general law and order. In
the first half of 1971 cases of assault and battery
have increased 18 percent and cases of rape 26
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percent compared to the first half of 1970.
Alarmed by this rapidly increasing crime rate the
media have criticized lenient sentences given to
"hooligans," and summary court proceedings
have been introduced in several large cities. In a
recent study of 290 enterprises, state inspectors
uncovered widespread tardiness, a general lack of
work discipline, and unjustified absenteeism by
employees engaged in illegal part-time jobs.
The central theme running through all of
these sermons is that criminal activity and bad
management, even though not always identical,
are related, because they both sap the material
resources of the country and erode the ethical
standards of the populace. Gierek clearly
recognizes that if he is to permanently quell the
popular discontent that erupted last winter
Poland's productivity must increase. This will not
be possible, however, unless social irresponsibility
and noncommitment are curbed. Gierek also
realizes that if the party is to be the leading
force in Polish society its members must set
the example in self-discipline. He will also find
it convenient to use this rededication process
not only to comb out deadwood but to insert
his own supporters into the party's ranks prior
to the congress in December %
Denmark: Parliamentary Election Likely to be Close
An extremely close outcome is anticipated
in the quadrennial Danish parliamentary elec-
tion on 21 September. The basic continuity of
Danish policies is not in question, but a parlia-
mentary stalemate and a weak-possibly minor-
ity-government could complicate Danish rela-
tions with the US and Western Europe.
The incumbent three-party coalition of
Radical Liberals, Conservatives, and Moderate
Liberals, which won 54 percent of the vote and
98 of the 179 seats in parliament in 1968, hopes
to remain in power. The popularity of this coali-
tion under Prime Minister Hilmar Baunsgaard
reached a nadir last spring, however, reflecting the
government's inability to check inflation and to
cope with perennial balance-of-payments difficul-
ties. Opinion polls have shown an upward trend
since then, but it is moot whether the improve-
ment will be translated into a solid majority at
the polls.
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The chief threat to the governing coalition
comes from the opposition Social Democrats
(SDP), Denmark's largest party with 62 seats in
parliament. Their leader, former prime minister
Jens Otto Krag, harbors no illusions of winning a
majority. He is prepared, however, to form a
minority government if his party regains the seven
seats lost in 1968 and the present coalition loses
its majority. Such a minority government prob-
ably would have the tacit support of the small
left-wing Socialist People's Party (SF), but at the
cost of pulling governmental policies to the left
on some issues.
The domestic economy is the major cam-
paign issue, with concern over Danish entry into
the European Communities playing an important,
if indeterminate, role behind the scenes. The
coalition parties and the SDP are officially in
favor of entry, but there is some, and possibly
growing, opposition in all of them. Moreover,
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Page 19 WEEKLY SUMMARY
some SDP leaders fear that a few oppositionists in
their party may defect to the SF, which is op-
posed to entry. Nevertheless, even an SDP minor-
ity government need not fear that dependence on
the SF would hamstring it, for the decision on EC
entry ultimately depends upon a national refer-
endum next year; observers confidently predict
that the outcome will register in favor of member-
ship.
All major contenders also support continued
Danish membership in NATO, but the SDP at its
annual convention in August called for the adop-
tion of a more aggressively anti-Greek and anti-
Portuguese stance in NATO, and the party is on
record favoring a retrenchment of the country's
defense establishment. An SDP minority govern-
ment also would be more likely to extend early
diplomatic recognition to North Vietnam than
would a renewed version of the present coali-
Otto Jens Krag
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MIDDLE EAST-AFRICA
India-Pakistan: Whether or Not to Invade
In the next few weeks, Prime Minister
Gandhi will probably decide whether to invade
East Pakistan this fall. By early October, or
sooner, the end of monsoon rains will make
large-scale operations in East Pakistan possible.
Some of her advisers will argue that further delay
will only increase India's problems and make
intervention at a later date more difficult. War
could be forced on India by some pre-emptive
move of the Pakistanis, but it is more likely to
stem from an Indian decision based on the con-
tinuing flow of refugees, on fear that without
intervention East Pakistan will eventually be
taken over by leftists, or on domestic political
pressure.
likelihood of famine in October has decreased.
The prevention of serious food shortages will still
depend on the food distribution system func-
tioning smoothly.
There is no immediate threat of a leftist
take-over of the insurgent movement, and most
guerrilla bands are still loyal to the principles of
the moderate Awami League. Leftist influence in
the guerrilla movement, however, has grown
steadily, and recently the league and the Indians
felt it necessary to form a "National Liberation
Front" and to include both pro-Soviet and other,
more radical, Bengali leftist leaders.
According to the Indians, there are now al-
most 8.5 million refugees, and they continue to
arrive at the rate of 40,000 a day. If there seems
to be no letup, at some point the Indians may
well decide that war is the only solution to the
refugee problem.
President Yahya, by appointing a civilian
governor in East Pakistan, by issuing an amnesty
for all but the insurgent leaders, and by taking
steps toward establishing an elected civilian gov-
ernment sometime next year, has attempted to
improve the political situation. The Indians tend
to discount these moves as a facade for continued
military action, and the mistrust built up over the
last six months makes most Bengalis skeptical of
Yahya's intentions. It is still too soon to tell
whether Yahya's actions will have any significant
effect on political conditions and consequently
on the refugee flow, but the Bengali reaction will
be clearer in a few weeks.
Famine could lead to an increase in the
number of refugees. The latest estimate by the US
Consulate General in Dacca, however, is that the
The Indian Parliament will probably not
meet until November, so Mrs. Gandhi will not
have to contend with immediate domestic politi-
cal problems. She knows, however, that her critics
will eventually try to exploit any failure to save
Bangla Desh.
Mrs. Gandhi will also hear strong arguments
against intervention. Her advisers will argue that
an invasion of East Pakistan means a costly war.
assessment of Chinese intentions could be crucial 25X1
in Mrs. Gandhi's decision. The Soviets have
consistently urged restraint. Mrs. Gandhi will go
to Moscow on 27 September, and her assessment
of the degree of Soviet support or disapproval
that India can expect will be an important factor
in her decision.
In the meantime, both India and Pakistan
continue to prepare for war. India apparently has
moved another brigade to the eastern border of
East Pakistan bringing its strength there to a full
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division. There are some indications that India's
only armored division may be moving closer to
the West Pakistan border. It had been assumed
that India would not go to war as long as this
division remained in central India.
There have been no recent major troop
movements on the Pakistani side of the border,
but forces are in a high state of readiness
there.
Middle East Developments
Along the battlefronts...
The most serious incident in the Suez Canal
area since the cease-fire was instituted in August
1970 occurred this week when the Israelis shot
down an Egyptian SU-7 aircraft on a reconnais-
sance mission over the Sinai Peninsula. Other
Egyptian flights have been fired on by the Israelis,
but this is the first one brought down. Continued
Israeli flights over Egyptian territory also pose the
risk of further incidents.
The strike at the industrial center of Hulwan
in late August allegedly had political implications.
The organizers of the strike were said to be
demonstrating their support for former leftist vice
president Ali Sabri, who is being tried for plan-
ning a coup against President Sadat. The delay of
more than a week in announcing the strike seems
unwarranted for what was officially described as a
routine wrangle between labor and management.
Moreover, Sadat had intimated that the strikers
had ties with "certain centers of power"-in-
terpreted by observers as Sabri and his alleged
coconspirators. Sabri formerly wielded consid-
erable influence with Hulwan's large work force.
If this strike was politically motivated, it would
represent the first public opposition to Sadat. The
president now may take an even more active
interest in the conspiracy trials, which are enter-
ing their third week behind closed doors in Cairo.
Sadat seized the occasion of a nearly
unanimous popular vote in favor of the constitu-
tion last Saturday to order the formation of a
new government. Prime Minister Fawzi submitted
his resignation and is now serving as the head of a
caretaker cabinet. The successor government is
expected to be announced this weekend, accord-
ing to the US Interests Section, which anticipates
some major personnel and structural changes.
Sadat may mollify some of the deposed ministers
by appointing them to posts in the newly formed
Federation of Arab Republics (FAR). The presi-
dent has portrayed the new constitution and the
imminent government reorganization as the latest
phase in the restructuring of Egyptian institutions
pledged last April when he cashiered Sabri and
others who shared Nasir's mantle.
The Italian diplomat who represents US in-
terests in Syria says President Asad is still seeking
ways to develop popular support and to assuage
opposition forces both within his own Baath
party and among Syrian Communists.
When Asad assumed power last November he
planned to form a party that would include all
political interests. The President now appears to
want a "progressive front" to allow the Baath
Party to remain dominant, to satisfy dissident
elements in his own party, and at the same time
to provide some accommodation to the Com-
munists who have supported all of his major
policy formulations so far. A cabinet reshuffle
and some changes in the Foreign Ministry may
also be in the offing.
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A significant sector of the Syrian public is
believed to oppose Syrian participation in the
FAR. The government admitted four percent of
the voters in a recent referendum opposed Syria's
participation, an admission considered to be an
attempt by the government to remain credible in
the face of this opposition.
Asad's continuing hard-line position toward
Jordan over fedayeen problems and the submis-
sion of the Jerusalem question to the UN Security
Council, as well as anti-US statements from the
recent Baath Party congress, are also symptomatic
of his need to hold the line in the face of opposi-
Ghana: Government Moves Against Labor Federation
The government moved last week to break
the back of organized labor, the strongest inde-
pendent force in Ghana.
The government, stung by recent sharp at-
tacks on its new austerity program by leaders of
Ghana's central labor federation, has rushed
through parliament a measure abolishing the
federation, eliminating the dues check-off system,
and outlawing compulsory union membership. In
addition, the labor minister was empowered to
decree a 90-day cooling-off period to prevent
strikes, after which he may impose a settlement.
Prime Minister Busia, whose constituency is
mainly rural, claims the moves are directed solely
at the labor federation, which he asserts had il-
legally retained powers it gained as an arm of the
Nkrumah regime. The legislation, however, strikes
at the basic sources of strength of the member
unions as well. Deprived of a secure financial base
and the power to compel workers to become
members and virtually denied the right to strike,
Ghana's heretofore strong trade unions which
have some 340,000 members may soon wither.
The government has announced that it will
deal harshly with any strikes, and given the state
of preparedness of the police, it seems unlikely
that any strikes will get out of hand at an early
stage. Over the longer term, however, the blow
against the unions will deepen the workers'
disenchantment with Busia, especially if the
regime maintains its uncompromising stand
against demands for relief from Ghana's serious
inflation. The result may be a growing wave of
wildcat strikes and other spontaneous disruptions
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WESTERN HEMISPHERE
Bolivia: Banzer's Problems Persist
President Banzer has increased pressure on
the extreme left, but the stability of his coalition
government is also threatened by developments
within the National Popular Front. .
Several clashes between army units and guer-
rilla groups-apparently on military initiative-
have been reported since 3 September. Oscar
Zamora's pro-Peking Communist Party and the
Union of Poor Peasants, which is also headed by
Zamora, have been implicated. The alleged pres-
ence of foreigners among the guerrillas, however,
suggests that the National Liberation Army is also
involved. The government is probably taking pre-
emptive action against what it perceives as a real
guerrilla-terrorist threat. These suppressive meas-
ures are part of a wide-ranging campaign against
centers of extreme leftist activity. The universities
have been ordered closed until next March, and
arrests of labor leaders are being followed up with
25X1 an attempt to install a more pliable brand of
leadership and to restructure the unions.
While Banzer deals with the extreme left,
centrifugal forces within and among the uneasy
allies in the National Popular Front are building.
Dissension within the Nationalist Revolutionary
Movement (MNR) is reportedly intensifying.
Intraparty battle lines, centering on continued
participation in the government coalition, cor-
respond to old personal rivalries and long-
smoldering ideological differences. A formal party
split resulting in the MNR's left wing leaving both
the government and the party could occur. Thus
far, the Bolivian Socialist Falange appears to be
united in its support of the coalition.
Banzer is probably convinced that should
the National Popular Front disintegrate, his
regime could carry on with only the support of
the military. Maintaining the loyalty of the armed
forces is thus of the utmost importance.
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Or%JIcr 1
Chile: Dissension Inside and Outside of the Government
President Salvador Allende, reacting to dif-
ferences within the ranks of his Popular Unity
(UP) coalition as well as to the virtual certainty of
economic hard times ahead, has mounted a
broad-front attack on opposition forces. His ef-
forts may indeed further weaken an already
divided opposition, but dissension within the UP
and other elements of the left have weakened the
government's prospects for monolithic rule de-
spite the facade of consensus to which it clings.
Through all government-controlled media,
Allende has attacked "sedition," which he charges
is increasingly evident in Chile. He also pointedly
sent his interior minister to seek the cooperation
of the largest opposition group, the Christian
Democratic Party (PDC), in ferreting out sub-
versive elements. The appeal to the PDC was
sweetened by Allende's inclusion of the far left,
as well as the far right, under the subversive label.
The government then brought formal charges
under the national security law against two prom-
inent conservative spokesmen-National Party
leader Sergio Onofre Jarpa, who had accused the
government of turning Chile into a "totalitarian
Communist state opening the road to Soviet
penetration in Latin America," and Sepa maga-
zine editor Rafael OterQ, who has allegedly slan-
dered the Chilean Army.
These actions have been accompanied by an
intensified attack on the few remaining opposi-
tion newspapers, particularly El Mercurio. The
small group of pro-UP workers at El Mercurio
have publicly charged some of the newspaper's
executives with evading taxes by carrying their
own supposedly voluntary salary cuts as operating
expenses, thus reducing earnings to workers under
the organization's profit-sharing arrangement.
Ignoring the newspaper management's refutation
of the government's charges, UP-controlled edi-
torialists and broadcasters pressed on with their
attack, accusing El Mercurio and its sister journal,
La Segunda, of persecuting their pro-UP em-
ployees and of being instruments of the CIA. The
opposition newspapers are aware that the ma-
jority of their employees support their position,
but there is a real fear that the workers' stand
could be changed dramatically by a government
threat against their jobs.
The pluralistic support on which Allende has
placed so high a value-the UP contains non-
Marxist as well as Marxist elements-is being
undercut by disagreements and splits on the left.
The struggle for supremacy within the UP be-
tween the Communists (PCCh) and Socialists (PS)
continues, with the tide slowly turning in favor of
the PCCh. Allende himself, although a long-time
PS leader, is increasingly taking the more moder-
ate stance of the PCCh. Partly because of his
interest in Christian Democratic cooperation and
partly through simple prudence, he has issued
arrest warrants for activist leaders of the extrem-
ist Movement of the Revolutionary Left. For
their part, the Socialists, already suffering from
the President's disfavor, are also being challenged
by the Radical Party for working-level positions
in several administrative agencies.
In addition to differences between the Com-
munists and the Socialists, and within the Social-
ist Party itself, Allende's coalition has also been
shaken recently by the splintering of two of its
other member groups--the Christian Left Move-
ment has emerged from the Unitary Popular
Action Movement (MAPU), and the Independent
Radical Leftist Movement has splintered off from
the Radicals. One member of Allende's cabinet
offered to resign after leaving MAPU, but his
resignation was not accepted. Another cabinet
position was taken over by a member of MAPU
following the resignation of a minister repre-
senting the Social Democratic Party, another
small UP constituent. The Social Democrats and
the main body of the Radicals appear to be mak-
ing their own independent power adjustment by
laying the groundwork for a merger. The upset in
the balance of power within the coalition is likely
to be further remedied b a number of additional
cabinet changes.
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Uruguay: Angry Rhetoric and a Promise of Action
President Pacheco has responded to the
Tupamaros' spectacular prison break by assigning
control of the counterterrorist effort to the mili-
tary. Pacheco's emotional rhetoric also included
the promise of further action, including a pro-
posal for "national control" of the educational
system-a persistent problem for the administra-
tion.
On the face of it, the transfer of responsi-
bility for combating subversion from the police to
military commands appears to presage a signifi-
cant broadening of government powers. Armed
forces authorities indicated they believed that
legal jurisdiction for terrorist crimes would now
fall to military courts, that search-and-seizure
operations would not be encumbered by legal
procedures, and that captured terrorists would
come under military guard and not be subject to
civil penal regulations. The civilian government
apparatus has generally operated within the letter
of such constitutional safeguards and has been
unable to strike a telling blow against the urban
guerrilla movement. Both the Congress and the
Supreme Court have blocked past administration
efforts to gain more sweeping powers, and they
could again pose difficulties for the President.
In a second step, Pacheco announced that he
would soon propose a law for reform of the
schools, which he described as centers of ideologi-
cal indoctrination at the service of the enemy.
Recent demonstrations by secondary school
students have led to several major confrontations
with police, and the university is a recognized
breeding ground for Tupamaros. Pacheco has
clashed with the legislature several times in an
effort to implement better state control; the gov-
ernment intervened the schools last year and
administered the secondary system until June of
this year, ceding authority when the Congress
passed a bill establishing a new governing council.
The President's new proposals, when made public,
will bring opposition from the university sector
and increase chances for antigovernment action
by the students.
in promising -o root out corruption in gov-
ernment, Pacheco oledged an all-out defense of
democracy and, in a burst of emotional rhetoric,
pledged to lay down his life in the battle. The
government repeated its promise to hold elections
in November
the Tupamaros meanwhile attempted to
maintain their initiative by freeing British Ambas-
sador Jackson last week after eight months of
confinement-a further reminder to the public
that the governme-it cannot effectively counter
the terrorists. A Tupamaro communique also re-
peated support for the leftist coalition, Frente
Amplio, in the November elections. The terrorist
document, although still contending that armed
revolution is the p oper path to success, was the
warmest endorsement of the electoral process to
date. It also discla,med responsibility for recent
revenge killings of police, claiming the movement
had in fact stayed its hand despite provocations
by the oligarchy.
Striking successes by the government against
the Tupamaros will at least partly justify the new
measures, but a lack of results will lend substance
to the terrorists' public position that elections are
necessary but made meaningless by government
repression.
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Venezuela Moves Toward Andean Pact
Prospects for Venezuelan entry into the
Andean Pact are brightening, and President
Caldera reportedly will decide Venezuela's course
before the end of the year. Most political parties
and technocrats are favorably disposed, especially
as the pact members seem increasingly willing to
accommodate Venezuelan conditions for privi-
leged treatment, and this attitude seems likely to
outweigh continuing opposition from industrial
interests.
The Caldera administration convoked a
"national forum" last month, seeking new bases
for policy making on economic integration. On
the basis of its final report, Caldera will decide
whether to buck important business interests and
lead Venezuela into the pact-a move with dimin-
ishing political risk now that most sectors regard
it positively.
The Andean Pact, which now includes Bo-
livia, Chile, Colombia, Ecuador, and Peru, would
be significantly boosted by Venezuelan member-
ship. Venezuela's foreign reserves (the highest in
Latin America) and stable currency would be
powerful assets in international negotiations, and
with the second highest per capita product in
Latin America its entry would substantially en-
large the group's effective consumer market.
Venezuela's inclusion in the pact also would con-
siderably strengthen the group's combined posi-
tion in the Latin American Free Trade Associa-
tion and give it a more powerful voice in dealings
with the relatively advanced "big three," Brazil,
Argentina and Mexico.
Venezuelan businessmen fear the competi-
tion from the lower cost industries in the pact
nations, particularly Colombia. Over the last 20
years Venezuela has promoted manufacturing
under hothouse conditions of state protection
and credits in order to lessen its dependence on
oil, which still accounts for over 90 percent of its
export earnings. The country has paid a high price
to diversify because, over the years, a strongly
protectionist atmosphere has developed. As a
result, manufacturers have been content to pro-
duce on a small scale, with high costs and broad
profit margins, for the captive domestic market of
10 million people. Supporters of pact member-
ship believe that the Venezuelan consumer is
paying too much for industrialization and claim
that Venezuelan companies, if forced into a com-
petitive situation, will become more efficient and
eventually enjoy enlarged new markets.
Early this month the new director of eco-
nomic policy in the Foreign Ministry indicated
that the pact members and Venezuela have moved
closer together on essential points. Venezuela has
abandoned its earlier notion of associative partic-
ipation and will join as a full member or not at
all. The five meanwhile have made membership
more attractive by being more receptive to Vene-
zuela's conditions, such as special safeguards
against devaluation by other member states and
restrictions on the migration of cheap Colombian
labor into Venezuela.
One major obstacle has related to the
Andean investment code, which is potentially
restrictive toward foreign investment, but there
has been a recent suggestion that the code is no
longer a serious stumbling block. A blue ribbon
commission in Caracas is preparing draft legisla-
tion for an investment code, which has been rep-
resented by some key members as leaning toward
the Mexican model, defining economic activities
in which foreign investment is not permitted to
operate, those in which there must be majority
local control, and those in which foreign investors
may be full owners. The pact members, however,
noting the economic nationalist mood in Vene-
zuela, may expect the Venezuelan Congress to
enact a more stringent code akin to the Andean
one. In any event, signs of optimism that Vene-
zuela will join have appeared in all the pact coun-
tries, and these have been reflected in Ca-
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