NATIONAL INTELLIGENCE BULLETIN

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00975A029300010038-5
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 18
• Document Creation Date: December 20, 2016
• Document Release Date: May 15, 2006
• Sequence Number: 38
• Publication Date: September 23, 1976
• Content Type: REPORT

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NATIONAL INTELLIGENCE DAILY CABLE
Thursday September 23, 1976 CI NIDC 76-224C
NATIONAL SECURITY INFORMATION
Unauthorized Disclosure Subject to Criminal Sanctions
Top Secret _
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National Intelligence Daily Cable for Thursday, September 23, 1976.
The NID Cable is for the purpose o in orming
senior US o icials.
CONTENTS
LEBANON: Situation Report
USSR-SYRIA: Moscow Reducing Criticism
FRANCE: Economic Program Announced
CHILE: Letelier Assassination
YUGOSLAVIA: Tito's Health Improved
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SPAIN: Cabinet Change
UK: Seamen's Strike Averted
EC: Obtacles to European Parliament
UNESCO-ISRAEL: UN Mission Refused
INDONESIA: Alleged Plot
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LEBANON: Situation Report
I President-elect Sarkis is scheduled to take the oath
of office at noon today in the Syrian-occupied town of Sha-
turah, despite threats by some leaders--most notably Prime
Minister Karami and leftist Kamal Jumblatt--to boycott the
ceremony.
Speaker of the House Kamal al-Asad expects between
65 and 70 of the 99 parliamentary deputies to attend;I 25X1
I Ispeculate that 42 Muslim deputies will refuse to make
the trip. Al-Asad has said that Sarkis will be sworn in even
in the absence of a quorum.
I IKarami's refusal to attend the ceremony is probably
ess an a tempt to undercut Sarkis than to portray himself as
opposed to Syrian control of Lebanese politics. Karami has co-
operated with Damascus in the past, but since Syria began sup-
porting the Christians, he has attempted to preserve his cred-
ibility with his Muslim constituency by arguing for a Lebanese
rather than a Syrian solution to the crisis.
I ISarkis' inaugural address is expected to focus on
is p ans for trying to resolve the Lebanese conflict--the
first indication of his thoughts on the matter. He may spend
the night in Shaturah in order to attend another Syrian-Pal-
estinian-Lebanese meeting scheduled for tomorrow.
meetings, has apparently asked Syrian President Asad to attend
tomorrow's scheduled session. According to a Lebanese news-
paper, however, the conference may well be postponed as a re-
sult of the earlier lack of progress.
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Sarkis, reportedly depressed by the results of the
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IShamun has been maneuvering to shore up his own po-
se on in the new regime. Earlier this week he had publicly
asserted that taking the oath of office outside Beirut would
render the inauguration unconstitutional, presumably to give
him an opening to cause trouble later if he decides to do so.
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Heavy fighting is continuing in Beirut; there have
been outbreaks of intense shelling, and sniper fire in the
downtown area has virtually closed off the crossing point near
which Sarkis was originally scheduled to take his oath of of-
fice. Clashes were particularly heavy yesterday in the south-
ern suburbs of Shiyah and Ayn Rummanah.
I Much of the activity in the Mount Lebanon area was
con i.ne to intense shelling, although a tank duel was re-
ported at Alayh. The Christians report heavy fighting in the
eastern section of the of Tripoli.
I
I Moscow is cutting back on its criticism of Syria and
ridy e trying to move all sides involved in Lebanon toward a
political settlement.
The USSR has been more evenhanded toward the S
rians
y
and the Palestinians in its recent public statements on Lebanon.
On September 8, an authoritative "Observer" article in Pravda
for the first time upbraided "leftist elements" of the Palestine
Liberation Organization, along with Damascus, for failing to
achieve a cease-fire. Soviet public statements on Syria have
also softened in recent weeks, and the central press has stopped
calling for a Syrian troop withdrawal.
On Monday, a Soviet diplomat in Cairo told US offi-
cials that Moscow was urging both the Syrians and the Palestin-
ians to reach a compromise. The Soviets have reportedly been
using "friendly persuasion" to try to get Syrian President Asad
to adopt a more impartial position on the Christians and Muslims
in Lebanon, while at the same time pressing the Palestinians to
be more accommodating with the Syrian leadership.
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USSR-SYRIA: Moscow Reducing Criticism
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Vladimir inogradov, the co-chairman of the Geneva conference
on the Middle East, to Damascus was meant to put pressure on
Syria. Syrian Deputy Foreign Minister Rafai remarked
that Vinogradov was more interested in relating the
Lebanese crisis to a resumption of the Geneva conference.
An article in Pravda by Yury Glukhov last Sunday
called or a solution to the Arab-Israeli crisis as a prerequi-
site to ending the Lebanese entanglement. The Soviets for the
past several months had reversed the order of those two priori-
ties. Glukhov also emphasized the "urgency of the speediest
convening" of Geneva.
We have seen no indication that Soviet efforts to
restrain the Syrians include a suspension of either military or
economic aid. Soviet arms carriers continued to arrive at Syrian
ports during August and September.
FRANCE: Economic Program Announce
I Prime Minister Raymond Barre yesterday announced his
lded economic program, aimed mainly at bringing the
French inflation rate out of the double-digit range.
The Soviet official said that the recent visit of
The main features of the program are:
--A three-month freeze on most prices.
--A package of fiscal measures whose net effect will be a
moderate tax increase hitting higher income groups and
business.
--Imposition of an anti-inflation tax on business.
--Slower monetary growth.
--Measures to increase investment in plant and equipment.
--A $1.2-billion aid package for drought-stricken farmers.
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Notable for its absence was any mention of controls
on wages -!a key inflationary factor--which have been rising
recently at a 17-percent annual rate.
I IBarre said only that wages "should" rise at the same
rate as prices for the next year. With the major unions opposed
to the Giscard government, such pleas for moderation are likely
to fall on deaf ears. The government, however, will try to set
an example in its own wage negotiations.
The government's measures should have a positive short-
term t, holding consumer price increases near zero during
the last quarter of the year. In addition to the price freeze,
the value added tax on a wide range of products will be cut.
A similar tax
creases tor about three
measures, however, will
of inflation.
cut in 1973 sharply slowed price in-
months. Neither of these temporary
directly affect the underlying causes
The real test of the program will come early next year
when the price freeze expires. Barre hopes that the projected
sharp improvement this fall will reduce expectations about fu-
ture inflation and thus induce both business and labor to behave
more moderately.
I Tax increases--including a 4-percent boost in the
corporate rate, and a 4- to 8-percent increase for higher in-
come individuals--will also help somewhat, but are not sufficient
in themselves to change the basic inflation picture. At best
they may help bring the government budget back into equilibrium
in 1977, following a moderate deficit this year.
Potentially more significant is the new anti-inflation
I ax on nu!liness, which has been on the books for the last two
years but has not yet been implemented. A uniquely French inno-
vation, the tax is intended to dissuade firms from raising
prices and indirectly to force them to take a firmer stance in
wage negotiations.
On balance, the French inflation rate during 1977
should be lowered by the new program. The rate will still be
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high, however, possibly close to 10 percent. So much inflation-
ary pressure has already been built into the French system--
especially the recent large rises in wages, money supply, and
imported raw materials prices--that .a more dramatic improvement
seem
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CHILE: Letelier Assassination
I //The assassination Tuesday of former ambassador
Orlando Lete ier is already causing problems for the Chilean
government, which is being generally blamed for the murder.//
//Opponents of the Chilean junta are pointing to
e e ier s employment by the Institute for Policy Studies as
the most probable reason for his murder. His studies there re-
portedly were influential in persuading the Netherlands recently
to deny a loan to Chile and to boycott Chilean products--actions
cited by the Chilean government in depriving Letelier of his
citizenship earlier this month. He was also an active lobbyist
against US economic and military aid to the junta.//
1//Exiled Chileans have played a prominent role in
the campaign to discredit the military government. Their major
centers of activity have been in Italy, France, Sweden, Finland,
and the UK. Pockets of exiles are also scattered throughout
Western and Eastern Europe, as well as the US. Many are members
of solidarity and resistance movements that spread antijunta
propaganda.//
I /Several attempts were made this year to form
a united opposition movement. A joint exile organization was
founded in Mexico earlier this year headed by former president
Allende's foreign minister Clodomiro Almeyda. Previous attempts
to coordinate and solidify exile activities have failed.//
/The Chilean government will have a hard time
s that it was behind Letelier's assassination.
Leftist opponents of the junta, who have the most to gain from
the incident, are already accusing Chilean intelligence services
of complicity.//
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/The opening of the UN General Assembly in New
York wi give the junta's enemies a clear opportunity to focus
world attention on the issue of human rights, and the Letelier
killing will be used as fresh ammunition.
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YUGOSLAVIA: Tito's Health Improved
I President Tito left Belgrade last weekend to visit
Be je in Slavonia.
The original forecast by Yugoslav officials had been
that Tito would stay in Belgrade--though not hospitalized--for
treatment of an acute liver condition. The fact that his doctors
approved his travel to Belje, which is about 150 kilometers (93
miles) from Belgrade, suggests that the 84-year-old President
is responding well to treatment.
I I On Monday, Tito received a delegation of top federal 25X1
and repub is officials. A short announcement on the meeting said
that his recuperation is progressing well. 25X1
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SPAIN: Cabinet Change
Gutierrez, who is close to King Juan Carlos, is likely
I I The Spanish government yesterday named General Gutier-
rez to e first deputy prime minister in place of General San-
tiago.
to be a more effective spokesman for the government's liberaliza-
tion program than was Santiago, who has ties with the Spanish
right wing.
Juan Carlos reportedly wanted Gutierrez as deputy
prime minister even before he ousted the Arias government last
July, but he apparently was stymied by conservative opposition.
He did, however, push the appointment of Gutierrez to be army
chief of staff in June. He may have felt that, in view of the
support Prime Minister Suarez received from senior generals when
he briefed them on the reforms two weeks ago, the time had come
to move Gutierrez to the deputy premiership.
I IThe sudden ouster of Santiago is likely to be viewed
wi some concern by the more conservative generals, but they
may be partially mollified by a high award the King will confer
on him today. The government may also be able to point to San-
tiago's health problems--he had a massive heart attack in 1974--
as justification for his removal.
It seems unlikely that the King's backing within the
military will be significantly eroded by the move.
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UK: Seamen's Strike Averted
//The national seamen's strike in the UK, set to
begin next Sunday, was averted yesterday by the successful 22-
hour bargaining session between union officials and shipowners.//
//The seamen, who had been demanding a special wage
boost that exceeded the government's "phase two" guidelines,
settled instead on a package of fringe benefits. Because the
benefits are unique to the shipping industry, most other unions
will find it difficult to use the seamen's agreement as a prec-
edent for demanding substantial extra benefits for their own
members.//
//Nevertheless, an official of the government's
conciliation and arbitration service told US diplomats that the
settlement "will cause a lot of headaches for the new government
during the next six months." The miners, in particular, will be
pursuing a demand for a reduction in the age for retirement.//
/A key element in the settlement was the ship-
owners' agreement to allow extra time off for seamen required to
remain on board ship without working and without pay. Other
fringe benefits included improved allowances for food, travel,
and other expenses and payments for periods of idleness between
ship assignments. r7~ -1
EC: Obstacles to European Parliament
I //EC foreign ministers formally codified this
week a decision made by the European heads of government last
December to hold direct elections to a European Parliament, but
obstacles remain that could delay ratification by the nine
national parliaments.//
I //In the preamble to the act, the member countries
promise to their best to hold direct elections in May or
June 1978, although they are not legally committed to that
date. A firm date will be set by the Council, presumably after
the nine national parliaments have ratified the act and passed
enabling legislation.//
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//The UK and France are the only states where
rata icati.on is expected to be a major problem. The British
Parliament begins debate this fall on the related issue of
home rule for Scotland and Wales, and this could delay consid-
eration of the European Parliamentary issue, possibly until
spring. The Liberals are insisting that the legislation pro-
vide for proportional voting--which would increase their num-
ber of seats substantially--and they have threatened to link
this demand with support for the devolution bill.//
//British Foreign Minister Crosland noted his
concern in Brussels that "genuine constitutional difficulties"--
as well as procedural problems such as the drawing up of new
electoral districts--may prevent the British from holding
direct elections as scheduled. While Crosland maintains that
the UK's inability to meet the deadline should not prevent the
other eight from going ahead, the French are likely to resist
making an exception for the British.//
//In France, ratification promises to be one of
the most ivisive issues before the National Assembly this
year. President Giscard faces vigorous opposition from Commu-
nists on the left and hard-line Gaullists on the right, both
of whom oppose direct elections on the grounds that they will
eventually lead to increased powers for the European Parlia-
ment at the expense of
on the other hand, are
this would strain their
national
inclined
sovereignty. The Socialists,
to support the bill, although
alliance
with the Communists.I
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//Israel has refused at this time to accept a
-sponsore mission to observe educational and cultural
policies in its occupied territories.//
//The proposal for the UNESCO mission is largely
a persona initiative of the organization's director, Amidou
M'Bow--the first black African to head a major UN body--and it
was taken in response to a resolution passed at the general
conference in 1972.//
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//That meeting passed three anti-Israeli reso-
lutions tnat e to a boycott of UNESCO-sponsored activities
by prominent intellectuals of several countries, as well as a
suspension of US financial contributions to the organization.
M'Bow has consistently tried to mitigate the effects of these
resolutions, despite criticism from Arab and other third world
states.//
//Israel's refusal to receive the mission--
claiming a he opening of the school year and the approach
of the Jewish. religious holidays made it impossible for local
officials to receive the group at this time--is likely to bring
further anti-Israeli action at the UNESCO general conference
that opens in Nairobi next month.
INDONESIA: Alleged Plot
I The announcement in Jakarta of an alleged plot to
over row the Suharto government probably is aimed at dis-
couraging criticism and intimidating potential opponents prior
to the general election next May.
//In view of the regime's pervasive secur
I
controls an e disarray of the political opposition, it is
unlikely that a serious conspiracy was under way.
Although the election is still more than half a year
away, preparations are already well under way. We expect that
the government-controlled coalition of interest groups that serves
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as the official party will return Suharto to power with a com-
manding majority. The regime's principal concern is to surpass
the 61-percent majority Suharto received in the general election
in 1971.
Although the administration has permitted some discus-
sion of shortcomings in the economic and social spheres, it has
now served notice that criticism of the leadership will not be
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