POLAND'S PROSPECTS OVER THE NEXT 12 TO 18 MONTHS

Created: 3/25/1982

OCR scan of the original document, errors are possible

CONTENTS

Pagt

KEY )

I.

U, TBE ROAD TO MARTIAL LAW

ID, THE PRESENT

A.oblical

TV

V -

.

The

R Econoantc

Food SapofcaaiSe

EceraUche We* . ,

Economic Stralecr end Rclomi .

C External

USSR :

Eajtara

The Waters

IV.

Economic

The Contalnraent of Larft-Soah

Politic*!

EvohiUoo of the Krai

V.

Implication! lot

ImpUcaHor* lor rhe USSREattem Euro

Implicatiina foe the United

KEY JUDGMENTS

Tbe irapoBboa of mjrtUJ law tn Poland bu permitted the regime to attain its minima! objectives of restoring centralized political control, suppressing Solidarity, and generally maintaining public order.martial law haa not forged any sort of national consensus or stopped the economic decline.

The decision to Impose martial bw hat ruled out genuine political accommodation based on power snaringossible solution to the Polish crisis withm the nextoonths. The range of conceivable outcomes now runs from limited accommodation through aof Ihe national political stalemate to repression even more extensive than that currently practiced. While the possibilityowering of public expectation* and accompanying moderation by the regime exists, most of tbe near-term contingencies that the regime Is likely to confront will probably push It toward continued repression.

Moscow is pleased that tbe Polish regime has regained political control and suppressed Solidarity. Throughout the Polish crisis.baric concerns have been to preserve Polandember of the Warsaw Pact and to restore the party as the dominant political force within Poland, while minimizing the Sovietvert Involvement In repression. Tbe USSR desires, largely for Ideological reasons, to have the Polish Communist partv set as the leading force. Nevertheless, because of deep disarray lo the party and the Inherent Instability of the situation, thetheirwill continue for some time to accept the military's dominantoverning Poland Moscow will not resort to direct military intervention unless the Polish regime loses political control and the security riroabonsharply.

Martial law Is unlikely to be fully lifted during the nextoonths. The restoration of the traditional power structure emphasizing the party's leading role will not occur quickly or easily and mayource of tension over the next several yean. Even when martial law fat ended, the military mayeed for continuing Its own role in political and adxninisfrative affairs, especially If the party andare unable to develop coherent and effective programs, remain divided, and show little ability to exercise control.

The deciiion making structure that has emergedransitional military/party/government hybrid. The regime is divided and factiona-liied, with hardline forces likely to gain ground over the coming months. For political and economic reasons, the Polish leadership will be especially vulnerable to Soviet pressure and will demonstrably stress its ties with Moscow.

The regime realizes that any progress toward creatingwith the population, especlaDy the workers, is closely tied withof some trade union activity. Yet it remains divided over

issue. The moderates will continue to advocate the creation of unions with limited independence. The hardliners, on the other hand, will push for the re-creation of the more traditional, "conveyor belt" model not much different from that which existed beforeeither side appears to he strong enough to force the Issue, and there is little likelihood that the problem will be resolved during the nextoonths.

The Church in Poland iseaker position than before the imposition of martial law. Its most pressing concern is preventing bloodshedoviet military Intervention; consequently, it has avoided becoming the focal point of active resistance to martial law. If there is severe regime repression of society, the Church will feel compelled to speak out more forcefully.

The regime appears to be pursuing an economic strategy of coercing enough outputrippled economyeleaguered population to ease Poland's financial problems with the West and to lay the basis for an economic recovery. However, the economic situation continues to deteriorate, largely as the result of shortages of WesternIt is uncertain whether further economic decline can be haltedevel that willolerable standard of living for tbeAlthough famine Isikely prospect, the food outlook for the nextonths is bleak,ossible crisis looming by late spring as

the regime may not be able to meet the urban population's

me iits for food-Warsaw still confronts staggering debt service obligations to the West, and will be unable to make any significant principal payments for the foreseeable future onillion debt. Warsaw will probably choose to pay as much as It can on its Interest obligations to privatemost impatientforgoing other payments due on its debt Its inability to meet much of the5 billion interest due banks2 means that thc risk of default will continue to

grow.

Warsaw's problems are being further exacerbated by the impact of Western sanctions, which will deepen Poland'? financial morass and reduce vital Imports. Sanctions will tend to make Warsaw more dependent on Moscow and its CEMA partners. Jarurelski is thus faced with the choice of presidingeeper and more permanent Integration of the Polish economy into that of the Soviet Union or ofthe political measures necessary for the lifting of sanctions.

If Poland were forced into default, this wouldimited impact on its economy in the short run. But, it could, at the very least, delay and complicate Poland's attempt to loin the IMF, thereby postponing important financial assistance. It would also have an important Impact on the ability of other CEMA countries to gain Western credits and would damage their trade ties with tbe West

Tbe chances that unorganized violence will occur in the coming months are very high. The widespread expectation among Poles that more open resistance wilt come with warmer weather will probably prompt some to engage in violent acts. In anticipation, the regime will have to continue the use of repressive measures. If spring passesajor upsurge of resistance, there couldsychological letdown among the populace that would increase the government's chances for averting widespread violencehile.

The substantial and well-trained forces of the Ministry of Internal Affairs have acted effectively In Implementing martial law, and we believethe continuing support of toea good chance of maintaining order. If the situation deteriorated, the regime would probably employ the Armyore active role but would choose those unite selected and trained forole.ftuahon In which thereotal breakdown of order, which we consider highly unlikely, the regime would have to contemplate using military units whose reliabilityiolent confrontation with thc population has yet to be tested. We do not believe that it will come to this as the Poles have sufficient forces to handle successfully most contingencies that could arise. Thus the likelihoodoviet military intervention is slight. Moscow remains willing, however, to move in should Ihe regime fail.

Moscow's concern about the willingness of Polish Army and Internal security units to maintain control In Poland probably has been allayed by the forces' effective performance in implementing martial law. The Soviets probably have some doubts, however, about the ability of the regime to mobilixe Poland If it were called to support military

operation! against NATO. These concerns may cause some adjustment in Soviet operational planning, but, unless the Polish situationradically, the Polish role in Warsaw Pact war-fighting strategy will probably not change

The United States has the means loignificant economic impact on Poland. But this capacity does not mean that tbe United States has great leverage over the Polish regime or tbe Soviet Union in determining the outcome of political events in Poland. CS influence in this respect is highly constrained by the stake which both Warsaw and Moscow have ineliable system of Communist rule in Poland.

Over the nextoonths and beyond, tbe Polish crisisarge potential to affect the Atlantic Alliance, rangingaior disruption to aofne solidification. In the present martial law situation, the West Europeans have made the same formal demands on the Polish resume as the United States, but they will not insist on tbe same strict compliance as Washington The Allies probably would be inclined to Iry to improve their relations with Poland If the Polish regime took some further steps to end martial law, released most internees, and Initiated the semblanceialogue with the Church and selected Solidarityquite conceivable regim* tactics. In thats unlikely that punitive measures taken thus far against the Soviet Union by the West Europeans would be sustained for long.

In sum, within tbe nextonths, the West cannot hope thai any of its actions will lead to genuine political accommodation in Poland The West can hope that the combination of Soviet and Polish need for Western economic cooperation, steadfast Western resection of business as usual and continued passive resistance to the authorities by the Polish population will have some moderating Influence on the regime and maintain the possibility of Song-term compromise within Polish society.

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t

INTROOUaiON

The Unpoutloo of martial by ihe Polkth regime onecember 1MI. wilh Soviet approval and encouragement, eoeduiively demonstrated the ifliiMi willtaameaa lo use (ore* In order ro ensure to political domination andall to an increas-aady open national discussion ol the couMry'i lutuia political and economic course. Tha pur pom of inero-dttdoa martial law wa* funatanwritalrr poimcai. notattempt to endthreat toCneamuaust party control to Poland by aaa of Um Potash military. It waa dralamarl to aeupies* 'be principal opponent of tbe party, Sobdarity. and tonaa of faar In bV Polish riepidatioa. To deny Schdanry the ablbryreonpmlte la oppewtton lo ihe fecuna. the Polish anthariUef moved quickly to irral most of Solidarity! leaden> of Ita moat active supporters. Tbe effect of martial Uw hai baan to out an end to any idea of genuine power ikarina, to deny theroad rinse of civil rights, and lo impend unionthe right to ftrlke, which bid been granted by tha IMO Cdnsask Accord*

Using hii onprecedaoted con>blnitMn ofparty and government head ai wellDefense Miiu*larwbnl aahibliihad military control over tbe decialoaoaakingIn Poland oruling Military Council of National Salvation and by patcing hii military subordinate* tn key peaiheca in the npvenunenultop waiilitary coup. Its So and Polish aathortthe military ftUtcOoniftg at Uvc adsiIMatraliva ana of tbe nxffecto-al Polo* United Worker*'official name of the Commumtf pany In PoLumL Dracoatan martsa) hwowever, have vat to solve any of tba fundamental political and economic proUerns lhat brought about tha rlM of SoMarHybe purpose of thU Eata identify probable devei-opnventj In Poland In tba neatoonths, to examine how the key internalparty, Solidarily.the aatemalthe Soviet Union. Eastern Europe, and theaffect the outcome, and to assess thc stability and effectiveness of the xvstem that we believe is likely lo emerge.

II. THE ROAD TO MARTIAL LAW

larusefaki publicly just il led ibe imposition of martial law aa necessary to preserve lha Polish slate.ivil war he declared was imminent, and end Ihe economic chaos that ha claimed was bringing the country to ilshese rationalizationsthe true purpose of the action was to protect what remained of the traditional system cf Communist rule. During the IS months after the formation of Solidarity, the party's ability to tuie had progressively deteriorated. By the lime martial law was imposed, the party badreat deal of Jts cohesion, was fragmented, and was unable to nxrt Solidarity'a political challenge.

The contradictions and irresolute behavioregime In disarray andactional irtd partyexacerbated the political situation in the months preceding the Imposition of martial Uw. Aeconomic situation, due only in small part to strikes, and rising public anger over the lackationally acceptable government program' made it harder for the moderate Solidarity leadership toils members and led it to devise iu own programs. Eventually, Increasingly political demands on the partlearly perceived threat to the system, to the poalUom of thousand* of Polish officials,he longer term, to Communis rule in the Warsaw Pact countries. The regime's unwillingness to commit Itself In good faith to imbtattortaiire most reform or lo Implement fully promiiea already Solidarity contributedator wayeakening of moderates and sUenglbenuig of radlcab within the Solidarity leadership. Thb trend was then used by Jaruzdikl to justify (ba Imposition of martial law. The factors tbat prevented ibe regime fromerious democratization of society beforeecern-

SKJKI

NOCONTlACT/OMCON

the idocttnca in Parish ruliraf circle) to them power andrewure fromHill pmarrt. and will maha the achievement in the future ofneootlated resolution of th* ongoing eritii aacaedirurly difficult if not Impoobie

III. THE PRESENT SITUATION A. Inter noi Politico! Affoiri

5 Tbe PolUhee of force .aainat itt 1and reasaerrlon of physical control haa onlycted pcoceaa olorepolitical system. IneWutloaallr. the eiittiott

poiitiealoverpaa ent by. brid. Tbe Military Council of National Safvaiion. comprtttne. SO mostly seniort forrrraDy the' hkjheatuthority It Ian down marital law rulra end reportedly make) resrulelioru and Ike moretant ooficvealier. Iriormal corecroon Ind -olnafrom the Military Council, the party Secretariat, and th* Council oftid to make day-today drcluona and roc Oder tone: term option) (aae table) Military over-aeeneen nkaced In factorba, aratorao. and tovernm*rrt ministries, and some officer) haveover direct control as provincialorna ten. The police and security servsceare very active and influential, and are raecutinai thst

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bulk of martial U- lecurtty (uncOors Ncvmthetaa. the dvihnn bureaucracy continues to [unctxwi indpartylthough not Ihe catty ai in inflilotkm, are playing important ro!n.

ft Tbe key military and civilian deciaionmaVeri seero tn be united In thett pursuit of certain minimal martial law objectives

To restore oenlraJired political control

To prevent the recoturitutiofl of Soudarrtv in ta pre-martlal-Ww form.

To maintain pubbc order and diadoltne.

To flop the economic decline and set Poke back to weak.

ommon recoaraBon that failure to achieve these floah by internal meani would probably lead eveotnaUT to Soviet military intervention- But, beyond theae minimal objectives, there ara anfla dietrree-menU between moderate* and hardliner) within the regime over tbe ultimate type of domed political order, the eventual dhpoaation of Solidarity ttvteraeca, and the character of economic reform. Badly divided, the regime hat been unable ao far to artfculale cleat policy lines.

espite iO harrarchaoal nature, the Polishu not unified Id its approach to aolvimSome of ill key leaden wanted tokw earner than laruxebki Within theof the Council nf National Salvationare difference! of view with respectwith the Soviets, the pace and aateniof martUl law mtrktiont. and the decreete ba tolerated. Deputy Minlner ofand sis other roernceo apBareDtlv arehardline anddivisions

within the Council. Jaruteliki reportedly has been able to dommale R. Still, (be Soviet! may aaa the mora pro-mem ben of the Council to presture firuubai and probably wktl aeek to cultivate the rupport of other member*

members

of the iJ^Z, , with specific proootab They were arnbava-lenl befeve martial law on whatangft were aceaptible and probably (eel thcmselres noweeak and eipoeed position The hardline Manca, eapreascd moat openly bv Politburo memberSeater in that it rejects the charam made nhoealbeaner party led bv ideoloaicairy pure cadres, end wpporU hanh maaium limed at crushing all refinance, purging hberaU in all Won. and forcibly rMrodueSng economic austerity.

sj.aB accounts an enigmatic figure diffkult to pigeonhole ii considered by tome Polaa.umber of senior Church officials, tomoderate"rimatut" andoviet puppet.w that In the cast, on tauU. be has mated rtrcnuoui Soviet prataure. Neverthefen. hit purported accentputhrneal of averttnc theSovietachieved only bv doing what the Soviets wanted.other Pole) considerovietJanurUki ha* tried toosture of Handing above the fray, and haa managed to far to work with both ibe hardline and moderate etetnenU in the knderrtup While them ara thoae within ihe Council and tba party "ho believe that Jaroefall) pouciet have not bean *lriugen< enough, they have not fathered the necessary support to undercut bin The Soviet) may bave had ronve reservation* about Jaru-ulikl before the Imposition of martial law, however, its wccessful impiemenlaiion inrely pleased them. They have trace ban aupporttve of keen and are apparently living; him more time to deal with Poland') prcUacra.ot clear, however, that Jaruretski has sufficient political *nwy to nuuu-uver peopleredetermined lung-range course of actionertainly aware that Moscow wiR continue to aaaaa fait performance, and. if hi* policial appear lo be too comprombxne. natteneHatlc, or unrejpocnve to the USSR, it will seek to have him replaced. In general, on the fundamental Issue) of control andole In Warsaw Pact operalioea. laruirliai ba* no essential difference) with the Soviet!

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TMCr/OJtCCN

Intelligence and apersonal associate. During his tenure as chief of military intelligence stisacaafc nrportedlv deferred conautently to Soviet -isbej and it Mid to have worked closely with KGB adviser) since becoming. Minister. He is. therefore, probably susceptible to Soviet pressure on internal security matters. His rank and file wouldarsh policy since this would allow them to exploit martial law conditions to settle old scores. If Kiszczafc it unable to curb the lower ranks, ihey may take actions that couldesurgence of resistance.

The Pony

U. Both moderates and hardliners hope to use the period of martial law to weaken their opponents. Nevertheless, martial law haa given the hardliners within ibe party the opportunity to undercut the influence of, or purge, those who had pished for reforms or had been identified with Solidarity. While (artier pursing controlled by hardliners would make theore centralized instrument of power. It would further discredit the regime, narrow its policy options, reduce Its capacity to deal effectively with ibe acute problems that new eonfroot Poland,ereby increase tbe likelihooduture violent upheaval

eruseUki probably bas serious doubts about relying on the party In its present weakcued state. He has been on tba Politburo forean and has been reared to accept lha primacy of the party; yet he has seen tba Polish party fall over the past decade to devise workable policies. Tntough hb new military reporting channels, he has become even more aware of the eilcnt of corruption and Inefficiency In thesystem dominated by tbe party. Ho probably has few Illusions about how quickly lhat can be changed, even though be is trying tocompetence by introducing military cadreinto the party.arty outsider, Jarnssebkl will probably continue to act as an arbiter within the party between conservative and moderate elements. Inmonths he could come Increasingly under attack from conservative* for not withdrawing lha military from Its political rot* and for not restoring the party to its leading role.

Solidority

egally recognised, iruly Independenttrade onion organization. Solidarity it dead, At most, the authorities appear ready to accept unions with only limiled independence whose activities would be restricted to ihe confines ol tbe factory and to defending workers* narrow economic interests The memory of Solidarity will continue, however, to be an important psychological force in Polish politics,Solidarity embodied ihe society's aspirations for wide-rangingythology will undoubtedly grow up around tbe union's activities lhat will empha-nre Its victories over the regime and play down Its owq internal disunity.

here will be increased efforts lo conductactivity. la which Solidarily adherents willrominent role. The union was caught totally by surprise by the declaration of martial law. but the (hock is beginning to wear off and anger is leading to action Neither Loch Walesa nor any other senior union leader seems likely to be co-opted by the regime. Those Solidarity leaders who have escaped detention are apparently having some roccest intheir shattered organisations and are able lo publish numerous underground leaflets and bulletins Such activity will become easier as Use regime eases up on travel and communications restrictions. SomeSolidarity activists are reportedly considering sabotage and other kind* of violence against the regime,

IS The response of workers to these resistance activities wilt vary. Some will have been cowed by the regime's successful use of force and prefer not to risk the ion of their job* and food rations; the publicizing of stiff sentence* imposed by court* for participation sinceecember in banned activities ba* probablyignificant intimidating effect. But underground union activists may be able to organ lie some strike activity and will try lo take advantage of disturbance that may arise spontaneously. The intelligentsia and student eommanlty will probably continue tootbed of dissension.

Th* Church

ith Scatoarity suspended, the Polish Roman Catholic Church once again becomes the primary defender of the populalioa against ihe regime. But II loo Is on ihe defensive. Despite lit vast moralIts politicalimited. Theost concerned about preventing bloodshedoviet

military Intenerrtion; r!y It has avoided

becoming the focal point of active resistance to martial law. The regime count) oo this self-limitation and thus believes It can ignore many of tbe deminds of the Church, although it Is also iDOrehensive of Church Influence especially at lower levels

verall, the Church his spoken out for iof the pre-martial.law national dialogue. But Its Primate, Archbishop Glerop. has vacillated into martial tow and has not mown the political finesse of nil predecessor. He hai been pressed by some buboes who feeltronger stand ii necessary ineturn to Ihe path ofthers. bowe*er. are concerned ihat such awould only encourage romance and could lead lo retaliation against Church facUitleg and freedom of action. The regime, for its part, will ertcourage such divisions The par lib priest* are more radicalthe bilbo pi and may help foster opposition forces Suchactions could become the focal pointarger confrontation between Church and state. If there i* severe regime repression of socletY. the Church will feel compelled to reflect the feeling* of the people awl to speat out more fotcefoily.

ey event In Church-Hate relation* thu year and perhaps an Important lagn of how the regime intend* to structure ID relatsoni with the Polish people will be the pruketed -bit of Pope John Paul II to Poland in August to rxanmesnoralo the tJOOtbof Poland'* holiesthai of Our Lady ofbe Pope probably has reservations about coming to Poland out of fear of bestowing legitimacy on tha martial kw regime or of being bkesed for Incident* or provocation* during hai trip. Thai regime alao undoubtedly has krnou* doubts about retting th* vtaR take pUe*apal viiit could rrtargineuy enhanca theIt could more unooftarrtly booat pubfic morale aad atreasgtben rears* -anoe. The Soviets, who blame tba rim of Sobdarity partly on tbeaK. reporledly choose his returning this year.

B. Eccrtomlc Problawii Produclion

f martial law hai been to hamstring an already weakened economy. The early

VOflCON

active resistance phase brought industryirtual .standstill as workers from several hundred ractories andtbe largest and mostwent oo strike- Moreover, tha sealing of pori* and border* and the shutdown of communication* cut off Industrial inputs and further reduced productionin the economy. The itrikes were Quiekty broken and many of tho transport and communication restrictions have been rifted; nowever, those >tttl in effect are Impeding enterprise communfearfons with suppliers and foreign market*.

Still, Ihe economic situation is deteriorating further, largely as tbe result of shortages of Western materials for industry, but probably also because of passive resistance. These shortages stem mostly from cutback* io imperii from thc West at the cod1 and the baiting of commerce during the early phase of martial kw, wllh the full impact of Western sanction* ttlD to be felt.esult of all these impediments, even certain miUUritsd Industries are unable to work extended boun. Production in the manufacturingmay decline byoercent in the first quarter of the year.

In certain sectors not as dependent on Western imports, however, notably coal and other miner ni industries,eportedly up because of the sis-day workweek and martial law restrictionsabsent seism, strikes, and trade union activity. Increased coal production might easendustry and permit tome growth In export*.

food Supptoi and the Former

he government has so far been able to keep market supplies of food at least up to previous low levels by the apparent release of military and other food reserves and emergency food shipments from the USSR and other East European countries The outlook for tbe neatonths, however, is riot good. Meat supplies are likely to decline aboutercent thb year because lack of grain I* farcing distress slaughter of chickens Mid hard currency constraints will Limit meatotato, flour, and bread supplies depend on thc regime's success in convincing tbe farmers to sell to tbe state. Althoughikely prospect, some Polish consumer* may suffer from proteinbecauae of reduced availability of meat and egss. andossible thai by lite spring thc regime

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aiooi crisis In meet in* the urbandemand for food.

n id approach lo private farmers, (be regime hai indicated lhat It wiH take whatever gen* are necessary to obtain food, eavoctallv grain. So far tbe regime haa Insisted (ha( (aimer procurement contracts with the state are legally binding, has tied farmer salesthe state with aeees* to aeed and lertiHier. and hej threaleoedait resortmpose compulsory procurement At (he same time, the regime has tried to balance these heavy handed polkias by offering more credits for agricultural inputs, bonuses for prompt deli varies, higher procurement prices, and liberalization of laws on pensions, farm inheritance, and site ol land holdings. This combination of threats and blandishments has not yielded the necessary pro curement Farmers are loath to part wilh grain as long as government feed sales are reduced and there are few goods for them to buy with their money. The regime hope* lhat retail price Increases wiH help make more goods available forut this strategy may not work. Compulsory debvaries and amajor confrontation between tbe regime and (he farmers remain distinct possibilities.

Ece-somk Retottons With th* West

artial law bas further damaged Poland'*relations with the West and prompted Warsaw toore heavily on economic ties with its CEMAthe USSR. The reduction in imports from the West hurt* Poland *ev*retv because of lis heavy dependeaee not only on Western technology but also on grain and feed concentrates, chemicals, high-quality sernlfinbhed goods, and spare partineeds frcen the West this year total dose to ST billion. However, It will probably buy only about SS billion worth of good) because of it* intention torade surplus in order lo pay some debt service.

arsaw Still confronts staggering debt service obligations to Ibe West, and will be unable to make any significant principal payments for tbe foreseeable future onillion debt. Poland barely managed to scrape1 without formal default. Bui new unpaid obligation* toward the Wart are mounting at tba rale0 million monthly, of0 million is Interest. Poland nowillion in debt aervke obligations (hiseach succeeding year in, Warsaw wiH probably choose lo pay as much as It can on Us interest obligations to privateroost impatientforgo'ng other payments due on its debt Its Inability to meet much of tbe estimatedillion interest due banks2 means that Ihe risk of default wiH continue to grow.

arsaw's problems are being furtherby Western sanctions, which will deepen Poland's financial morasi and reduce vital Imports. Tbe rnort serious casualty is Ihe poultry industry, whose decline will result In decreased availability of meat and eggs for Polish consumers. The cutoff ol vital Western credits ha* forced Poland to tradeash-and-carryreducing the amount of even key Western goods tbat it canhas blocked iheof1 financial strategy of importing On credit and using export earnings to pay Interest to private banks. In recognition of Its Inability to meet its2 obligations, particularly in light of the suspension of rescheduling talks, the government in late January unilaterallyotal moratorium on2 principal and Interest payments "for the timeowever. In an attempt to keep Western creditor* from declaring them in default and to keep some economic lies to tbe West, the Poles willresume some payments whenbligation] to banks ate met.

Economic Strcrtegy ond Ralorm

he regime appearse pursuing an economic strategy of coercing enough outputrippled economyeleaguered population to easefinancial problems with the West and lo lay the basis (or an economic recovery. Its Introduction of higher retail prices Is already leading to someof disorder in domestic markets and restoration of value to the currency. This, it hopes, will lead in turn to greater production and food procurement because workers will work Saturday* and overtime andwill sell their crops to the state in order lo buy the more expensive goods. The strategy could contribute to some stabilization of the economy. But the extent of any near-term it*biFixation or recovery will depend heavily on provision by the USSR, andesser extent by Eastern Europe, of enough assistance to make up much of (he loss of import) from the West

SECStT

norc*h

near-term economic prospects will depend alsoetort by Ibe Western government*'i on continued patience among Western lenders sboul collection of their Polishbe strategy also recretres acceptance by the population ol lower living standard. Massive Increues In lood and ulllily prices3 were not fully offset by wage compensation, and about of tbeprivale farrnen and cratUmen received no comperoalion Privatehave been especially baid Oil as price* of their equipment. fetUliaa. aad caber inputs have been bocatod by more than incnsmoe* in the sales price* of theiroreover, retail prices ofroods will be Hung rapidly this year, further lowering living standards, despite recinac pledges lo monitor price (ncieases by enterprises and to consider fust her wasps compensation

satiaeaaki Lt comm.rted to push ahead with dik ecoetorolc rsdorm because he recognizes mthat the old system of centralized planning.tailed direcdva* from ihe lop. and btflesuoU price* aot reflecting scarcities dad not work and contributed to thc problems reading to the0 events. The regime has Implemented planned wholesale price reform and devalued tbe doty, ft wtl probably enact Other reform measures, alt hough potttive effect* from these steps largely depend upon parallel movementeesotrahisd aconoroy. NtvChcUsa. Jam-reuii's desire to malataln control over tba economy will preclude hti accepting much decentralisation, tolerating worker Influence on decisionmaking, or relylng on economic foroei to guide UWof whach are needed lo addras* tbs basse problem* of Ibe economy. Thus the regime's emphasis on tight economic control, and probable worker resistance to declining living standards, redoes the chance* tbat signilicnM economic reform will bs enacted In the neatoonths.

C Eattesncjf Forces USSR

hroughout the Poluh crisis. Moscow's basic ccescarrn* haveto preserve Polandember of the Warsaw Pact and to restore tbe Commumu party aa Ih* dominant political lores within Poland, while minimizing lbs Soviet Uaaon'a overt involvement in repression More broadly speaking. Moscow has sought to had of) ihe weakening of Soviet hegemony throughout Eastern Europe that IllsavaiWtion In Po-bndime have (catered Having prsssed ike Pole* for many months lo prepare for maritaland having coordinated its planning and advocated in implementation at several points during the crisis. Moscow dearly wricornad ita imposition and the effectiveness wilh which Polish security forcei carried out thdr assignments

Soviets, Kernelhsien, appear to realisebasic problems remain unsolved andlaw In some respects has complicated IMoscow as concerned about division*party, ihe oragcang economic crista, andantipathy to tbe regime The eompltaltyproblems and tbe unpredictablUty of eventswsB provide abundant grossnd* forMoscow and Warsaw, and probablySoviets themselves, over appropriate actions

Soviet* may mucosae thai genuinein Poland will eventually require somaand accomrnodaUoa Nonetheless, ths Soviets,Poles,s they cannot afford lo allowtooercive policy tob likely to urge the regime to useit necessary lor maintaining order, topurging thnae within the twrty and otherwoo are Identified with (a: reachingand to work al Improving the economicenforcing austerity measures. Tbs Soviet*conciliatory gesture* only if tbey ateihe top aod only to tbs citenl tbat thesenets-nary for preventing nine wedblunting major sanction* by the West. In thethey will take whatever action theyincluding ths uac ef Soviet military force,that the Polish regime retain* control of

s long as 'aruasrlshl appears able to maintain control and is responsive to Soviet views, Moscow it unlikely lo seek io remove Nm. It will, however, continue to cultivate potential challengers asmeans of inducing him to coopers le aad of preparing (or possible future contingencies For ideological reasons.

SCtORN/SOCCMfACT/OJICON

USSR daures lo htve ihe Polish Communist parly act a* ihe, force In Poland. Ileveflecame- ol deep disarray In Ihe party and Ihe inherent instablllly of the situation, theIheit misgivings probably wilt continue for some rime to accept tbe military! dominant role in tovermrui Poland.

oviet policy toward Poland primarily reflects baaaC stisdespe conrtdetaliona ibared by all Soviet leader! Ctinaeqaitntly. any change* within the Soviet kedenhh? aref fact only tba ton* aod pace ofrasaiuaag le event! Tbe recent death of Politburo member Susie- probably baa eapaaded tbe limits of what at ideolcancaJr acceptable to Mocc-but it un'ileiy to have diminished Soviet ceetccrn for Ihe reenablubrneot of atone central control Of tba two lead Inc. contender! to succeed bVettincv. kUrilenko haaarder line than Cbemnko on most foreign policy latuea and rrughl prefer to react to eventa tome what more Quickly and 'cecefully.the exact atanoa to be takenontender will be partly detwrmlned by tbe aluatlon prevailing Inat Ihe time and by hi* percnptioii of how II can be used to further hat own politicaloothy. if an abrupt turn of events In Polandwith Intense political maneuvering in Moscow, the interaction of the two could significantly influence both the Soviet tuccesaloo and Moscow's policy toward Poland.

tfl attempt to maaimiae its tnfluence by maintaining clean liaison al various level* wilh Pcllsh miHtary snd cuilian authorttles, partlculaily in tb* security apparatus (where KGB inf Jtranooincreased greedyy playing off rival person* hits* and faction* wstbta rosing mattta-tione; andnfl rissh-leveJ vims. authcalUtlve media commentary, and eacrmoga* of caxreapoaasestce to underscore its views Tbs Soviets will seek (probably with little tucceaa) to naodify Polish public opuiion by maintaining sn Intenae propaganda campaign of their own while lamming Western radiobroadcasting.

ariroale* Indicate that Soviet economic assist-anc* to Poland1bout II bilhoo In hard currency and aboutillion ruble* (tbe equivalent ofillion) in other forms of aid, much of it in price subsidies. Although tha Soviets so far have not> willingness to provide substantial hard currency support toof last year's assistance consisted of rolling over old hard currency debt to theneed to prop up the new Polishcould well force their hand. Poland desperately requires funding for purchase* of Western foodstuffs *nd essential industrial rnateriab such as steel and chemical! But because of it* own hard currency problems, the USSR may not wish to provide even commodity assistance on morehort-term basis.

The Soviet attitude toward aid for Poland ha* become more favorable since the Imposition of martial law. Moscow agreed in early2 to allow Poland toillion-ruble deficit in their2 trade, and will probably increase that amount. The ruble credits involvedcovering one-fourth of Poland'* Imports from tbefree op an equivalent amount of Polish goods for capott to bud currency markets or for use at home. Without Soviet acceptanceharp drop In import) of Polish coal, for example, Warsaw could not have met even its greatly reduced target foe coal exports to the West.

The Soviets will encourage tbe Poke* to seek Western debt relief and credit*anner that does not coin promise the restorationeasure oforthodoiy internally or lbs further integration of Poland Into CEMA. The Soviets are likely to make further aid to Poland contingent on the regime's pursuing policies that tbe USSR approves, andany increases are likely to be doled out piecemeal In order to maaimiie Moscow's leverage. Moscow has alreadylimes lastwillingness to use economic pressure tactics and will be ready to do so again. The Polish Leadership will be especially vulnerable to Soviet pressure because of the dire ftale of the economy and reduced levels of Western assistance Soviet leverage, however. Isby Moscow's recognition that tooreak in Polish-Western trade relations and too much pressure for faster CEMA Integration could precipitate further dcsUbiHration in Poland and the need for still morei! Soviet assistance.

East am Europe

the successful implernereatson ofPoland's East European alliesighparticularly tho East Germans andThev feared the creation of an alternative

political model that might prove anrsctive lo their sopufjiiom Prague end tut Berlin wia" keep pressure on Wi.ii. to reesrabuth central ceMrol Budapest win, aiine; iu own etpertene* a* an nam pit. probably poo* out caotioualv thai ante ferca ol rjotriicnl aecora-rnodstion wdl eventually be tweetaary. All ol Poland's aBies wil remain concerned about potable flareup* of new political urvaat In Poland.

hen tMitfodMn with martial law. the Eatt European* remain uuncerned about the costs to them ofrrrbleRit. because of the division of labor and tha mutual depend?nee within CEMA (espcciallv th* heavy rellano* of torrw co-rnlrkn on Polishhem hiv* been teportt about thoof the failure of the Pole* to deliver contracted aooda The East European*hole probably have bad to pay0 mi then in tcaree hud currency for replaceatenla Tbe East Germans have been forced to aceeleiat* their lignite mining to reduce their dependence on Polish coal, ind the CraeheaJcveio have aliesrndly talked abouttheir eaporti of cagata] roods becauM of reduced Pewsh deirseanea, Tb*uropeans wiu probably not be able or Main* to offer tha bad of economic aanitance that the Soviet Union tt corntdering. They will continue to provide tome lid, but will resent Warsaw'i requests lor even more help

Th*A -

est European leaden ft* the rjott-Worldollih lettlementt key element lo the European order and view Poland asterrttorv belong-in* to the Soviet tphere of influence. Tbalr interest in nurturing pclitieal change la PoUnd i* clearly tubordioate to'cr-st la mlWmrjing any danger of East-West military confrontation Tbol they refuse to make liberalisation Inrrreovlsrt* [tn aEast-Want rawtsrm*hu> Ne-trthelaaas. the US NATO Allies do generally want tit taxne^age and facQltat* the survive! of parts ef the reform prcarrarabecan wlsM aooe ml hsence but arc wary ef actions they think wtl aggravate th* M'aaTum. Some ieadrrs. notablyCermaa. believe that the eiiatlngef Easf-Weat ties has inhibited Soviet mlttaryAllien' greafeat fearPoland

Several factors are tending to posh the Alliestronger stand on Poland. They are sensitive to talk of US dilenchanlment with Western Europe Folicerceived lack of support on issues such as Afghanistan. Iran, nuclear weapons, and defense spending. They reaKte the damage done to the fabric of the Alliance by public airing ot* dissension over Poland In tome countries, the domestic politicalhasurther hardening effect on governmentajority ef West Europeansof the regime in Poland aod of Soviet ptessuie on the Poses. Consequently, leaders of the larger NATO slates have found, as the crisis over military rule has progressed, that the most politically profitableIs to toughen their rhetoric on Poland.

umber of concerns also prompt the Allies toautious stance. Their caution is powerfully rnotlvatedesire to protect thebenefits received from dealings with the East. Led by the French and the West Cerrruns. the Allies argue that economic sanctions hurt those applying the sanctions more than they do Ihe targot They are quite likely to avoid taking measures that would incur the loss of revenue, (obi. or more diversified energy supplies.

Allied governments are willing to repress strong verba) disapproval of repression in Poland and to hold Ibe USSR ultimately responsible. They believe,that major punitivethey see as increasing the chancesong-tooting repression or Soviet militarybe held in reserve as threats to deter such developments Moreover, the Allies want to hold open the possibility of rewards for tbe Poles and Soviets should the situation improve. Even If the situation deteriorates further, the West European) are unlikely to take meaningful steps unless heavily pressured to do so by the United States.

The West Europeans are also chary of the idea that armsnuclear armsshould be Inked to events in Poland. Most West European governments believe that efforts to control nuclear weapon) should proceed Irviependenliy of any but the most brutal Soviet behavior. They areopposed to an interruption of the talks onnuclear forces. Nevertheless, in the event

Grl

direct Soviet military IMervenllonoland, the? Allies probably would acceptipemion o( the INF neeotlatlons Thtv would caution,that NATO not live thc Impression of seeking to fain strategic advantage from (hit step, and If the iitiiarlon In Poland stabilised tbey would twee that nexctlatlona reiume

IV. MtOSPECTS

nprecedented Internal and eatemal ee^vjHioea affecting Poland's daralopeaent probably render past ixvUaoce> of regime couoUdatlon tfl,L OToor guide loutare over theo IS months Tba key latsrwal factor) arc cconoraie duarater. military rvU in tb* -akeclbipas of the CcerustuBbt parly,ccxilalloa tbat haa eapcri-eaced moreear of Increasing freedom fron Communist con" rob. Ertemallr.el or on the brink of default, remains daptndent on economic ties with the West, but la looking mora to the East to aatttly Its needs The USSR, despite Its desire to lock Poland more lightly Into the Eastern economic bloc. Is neverthcless com'rained In how tar It can go by its own need for trade with ths Weal and Ita own eccatoraic Urlriaencles. Politically. Moscow must deal with tbe linkage between IH behavior toward Poland and achleveinentrKlcsl foreign policy aim: further weakerilng of the Atlantic Alliance and pre-veraion of IMF depfeymsnt In Western Europe. This is cos of lha primary factor) that compel It toremiumn aaaliiii ot riataranea In Piiand by tbe Poll* authorities thermal.**

olandi asture ever the neatn IB months bas to aoroe eatent air cadi been tat by the choice to Impose martial law, but various paths are sti! open The daydslcsi to retort to force has ruled out genuase political accom modal tonrend Feasible within tbe period covassd by thia tai mate. Tbe rang* ofe outcomes now runt from limiled accommodationrolongation of the current national political stale mate to repeeuvon even mors extensive than lhat currently practiced by ibe Jaruaetikl re rime While the possibilityow "tins of public expectations and accompanying moderation by the regime exists, moat of lha near-term contingenctet that the latter t* likely lo confront will probably push It toward continued repression rather thanelaxation of controL economic Sfo&lixotion

A central Question Ls whether economic decline can be haltedevel lhat willolerable Standard of living for the population (albeit tbat ofo IS yean agoX or whether the economy will plunv met stillostlblllty of flop-pins- Poland's economic slide does esist: ihe country has raw(notably coal)arge agricultural productionurrently underemployed labor force, and unused capital stock. Yet. Intractable problemstheteep drop la vitally Deeded Western Imports leadingurther decline Inoutput; rising underemploymecl problems; and di(incentives for Independent farmers to market their produce These could leadurther disastrous slide of the economy.

The need to enforce painful and unpopularthose of allocating extremely scarce resources between exports and the domestic market, and between the cities and tbewill at the very least reinforce political factorscontinuation of martial law for an extended period. The regime fears that economic dislocations inherent in any economic plan It may adopt could spark public protest; it also knows ihxt it will have to presideeriod of at least three to five years of austerity tn order to have any hopes for management of its external debt problem and economic recovery. Thus, It It likely to rely primarily on coerdoa rather than persuasion to induce workers to produce more and farmers to cooperate with the stats. At tbe same time, the urgent need of the government to obtain Western imports, credits, and debt relief and to encourage labor productivity may leadelaxation of tome of the more vexatious features of martial law.

Th* Ccsncmrnant of large-Scot* Violence

resistance activities are and probablyto be nonviolent displays of opposition tosuch as leaflets, posters, work slowdowns,workowever, tba souroas ofviolence lhat could erupt spontaneouslyto undeiaround activity arc ready atover food shortages, lack ofpossible wage losses due to productionsteep price hikes; anger over police repressionwidespread disenchantment arriorsg young

SICaftT

Poles, especiailv arudents;ver the resjjmc'i corruption ind Inabilityoo* with Poland's rsrcfc-kou. and hatred oflthough the retjime Km rmnanta to rertot* caution imoni thoa* apparently notallm* feat En ot breaking the moral* of Klorllicit conimurWa-hon that votmtnlr, could trigger and quiet I. tnreadrej^unc-behove, rrietwfere. thst the chances of the

of unorganised violence in rhe coming month* ar* vary high.

5l_ Whether isolated flaroupt of vioknce merge mto large-teal* rtalkmwid* conflagration will dependrge degree upon th* regime* handling of organized opposition and the Mr*ngth of thebe ihort rvn th* pace of raaiilano* effort* may accelerate and organisation may improve. Acts ofviolence (gainst the regime oo the part of tomelthough strongly deplored bv moderateelements, can be *ntkip*ted; and these wifleaaors for baidliixn In the nranrae to argue for mom draconlas rapraatieei

Si ThMowkey Nocture There isesoa*ct*tioe among Pols* that withwtB come mora open ratjattnc* Thisanil undoobndl> prompt tnree Pole* lo ergrageacts, in anticipation, th* regime will havethe usemaascrtea. If the regime

can nuke ft through th* spring, there oouidicaj letdown among tbe populace that would increase tbe government't chances for averting wbrh> spread violencehite. However, ihe potential for violent resistance will remain.

he mbctantiel and well-trained forces of the Minatry of. have *cted rrffertiety In ImpJemenring martial kw. aad we believeIbe continuing support efood chance of maintainingf rhe situationthewould probabJv nnptoy tb* Armynore active role but would choose those units selected and trained forole.ituation In which themotil breakdown of order, which <av consider highly urtltkely. the regime would have to contempkte using military unit* whose reliabilityiolent confrontation with the population has yet to be tested. We believe that the Poles have sufficient forces to handle Jisecessfiitlv most conHrigencies that couldhus the likelihoodoviet miliarylight- Moscow remains willing, however, to move in should the Pole* fail.

PoKtfcol Toe tics

The regime will continue towo-track policy aimed, on the om* hand, at root-and-branch suppression of all organized underground resistance and, on tho other, at the institutionalization ofcommunication and control links with the population. It foresees the emergence of some kind of ll!-defined yet significant riartldrsstory-ccmsultative process that would pcrrnit pdiiical accommodation with major socialworkers, farmers, the intei-fieentsia, and students. U"rogram could be implemented, this would sap the vitality of "eatrern-isl" underground resisur.ee and contribute greatly tobairation.

The prospects for achieving effective links with the population cannot be dbent*ogled from thetreatment of the opposition movement. Tbe regime enjoys no trust and little. If any, legitimacy In Ihe eyes of the population. To gain that modicum of trust necessary to establish such links, the regime would bave to terminate fundamental rather than peripheral features of martialwould then be likely to accelerate undersrround resistance.

Theapsullicd in Itsof what to do with thenternees that il still gckrvswledges.ooed release of these prisoners (Includinghere I* not much likelihood that the regime will be able toenuine deal svith any recognized spokesmen of tbe workers, arrange muchialogue with the Church, or interest Western governments in droppingutroad release of prisoners not accompaniedegime commitment to genuine systemic reform, there wouldlear danger of giving underground resiitance* major shot In tbe arm.

ON

believe that. In dealing wtrh (hit hue, the oil wenfieem to favor of short-cam security itri treats, while attempting lo convey anof moderation. What we are likely lo ace,ortUfarenttafed *pc*oaeh to the pattooer-rrktnteaach wul aaek to oaf taw tbe daraarr of rcliajf through phased liberation of tbe leait dan-gmous Irslvilmli. attempt) to fractuie unity among the remaining iMerneei ifuough enorilon and prove-cat km. continued detention of thoae who will not cooperate, and continued offcri of emigration.

ba regime facet peahac* an even more veiing dilemma over how to restructure the trade un.oru to general and what to do abcut rhe impended Solidarity In particular. The regime reaJxiea that any progrnra toward ere.Unit meaningful link) with the populalton, aapeciaDy theosely Unktd wKh the revival of aoeae trade errrioat aesnvtty. Tel it temaint divided over the ttsue.dera*e* wlU continue to advocate the ere*doo of unions with limited mde-penJance. organ Jed along occupational rather than, regionalha* would be allowed ea air workeroe* while mil rubied to regime control Theon Ihe other hand, anil push for th*of the more traditional,"et much different from that which eaaated beforeictory for the harrfltnen woo Id ilramt rsirtainly further alienate the work*n. fuel underground resistance, and prrvsably force Ihe Church to takemore confrontational paction.nt that-.lv* latemed Walea* cot.tlr.uei toedal statu) tuggetta that the moderate* have not yet totally kat out on this point But netthnr tide appears to be arxong arsough to forest the not and than kt Uttl* liWihood that th*1 be reardved during tb* nett II toonths,

ofegime

heof the traditional powermphaiiting the party') leading role, will not occur quickly or easily andSJ*lsource ef trmrSon over th* neat aeveral yean Even when martial law kt etsded. the military mayeed forIts new rote In political and adramtStnliv* iff* In If the party andre troabl* to develop cohrrtat and effective nrograma. remainand mow intU ability to eaercla* control. At thc top. decision* will probably continue to be mad* over tbe nest year or to by an ad hoc grrrap of leaden tenuoutlv united bv their common rise to the top of the power structure end bv their personal ties to laruirlihi. The "tuition is much more complex at lowerherehct may wefl emergemilitary officials performing civiliannd their party or governmenlal counter parts,

policy terms, tbe regime of (he nextoat hhefy to be *ubt*et to touch themaatui at from hardline and moderat*that the party Politburo eipes.enced beforeof martial law. Jarmelski willIn overall control, but willartymoderate* are on the defensive aadappear better organised. As aaBowi them plausibly to callesaive measures, the hardliner)'probably iricreaae Hi the coming motif fa*.not providetopport to all tbalrbat, willoursj* that enhance*promotes Soviet InJluence.

theofow andof Western aaaarsrJoes, the Polish iwgimeup tbe alleged subversive lie* ofvoiced Increasingly strongtwhileeven iccee (orcef afly its commitment totin* flows from the regimenterealIts tactical reaulreraent* in suppressingand it) desire to placate the Kremlin. Thewell become snore proorsancod Over thebut the regime will be centralned to *ontehopta of Western economic aarSStance.

V. IMPLICATIONSfor Poland

etpite martial Law, Poland remains unstable. Tha decisionmaking structure that has emerged it tiarutScml. ind lacks legitimacy The rogun* isand faction*)Iaed. and hat proved incapable to date of formulatingcoherent political economic strategy. Ut* of th* Army for repressive purposes hasU* public nandinc Ir ratlins some tvmpajhyhe eies of The population, but it has lost its appealhe one component of the regime lo which most Point felt

alleglsnee. Popular discontent, stimulated bvresistance, is likely lo irow. remforcinf. low prod.activity arid possibly leading to violence. Under ArctseSShop Cletnp's vacillating keadrrtbip. ike Church kit been thrown an the defensive snd will be less able than previously to calm poobe pantoo* otncderatlng Influence on the regim*

he resprac may weal ba trapped Into an ewr-pending reaort to coercion. To and mantal law, release the internees, and engage 1st aasod-failhb Solidarity and the Church woold mean to accept power (luring, Tha regime Imposed martial law precisely to avoid such aa eventuality and it la even leas likely now than last fall to accept IL The possibility that It will be prepared or able lo the near termaccept these eordirlona wwich have been setf ting of Western sanctions it low. However, the regime willoncerted effort to present an appearance thaiaking atrpt that amount to de facto compliance with the three concUtioa*.

lor tba USSR ond Eastern Europe

be suppression of Solwiarity by the Pccuh authotities thernseJves has allowed Moscow to distance llaeif from the impaction of repression while counter-lag the immediate threat to Soviet hegemony an (Caatern Europe. The political and economic costs to Moscow, however, nill still be ksgh 1st addition to providing more economic assistance to Poland, the Soviets will have to coo. jsnaate to some extent foe tb* negative impact of martial law on economic ties between other CEMA countries Bnd the West

St Continuing traetbaliry in Posted wiH exacerbate economic problems In the other East European coun-trtea Thev are being increajtngly shut oat of Western credit markets, and thisheirraartlcisUf. tbat of Hungary and Eastcontinue sheeting their financial oc-.sa'-oei Pceand't lillure to deliver good* wiH continue to lores the East Europeans lo purchase substitutes on world markets scarce bard currency. The trend toward slow growth or stagnation, in part due to the Pollih crisis, will abaUouWOna! effect cat their domestic politics

ha Soviet* reakse that the Polish situation tee aome lime to come will impede their attemptsatCOrt

prornote political aod economic lies with Wasicrn Europe and to divide ibe Atlantic Alliance. While theyprepared to accepthey willtrong effort to plav ope* West European security ec reams, loterest In trade, and disagreement with US sanctions policy.

* a result of events In Poland, US Soviet trillions have sunk to their lowest point nnce lha Immediate aft*Ttnalh ol Afghanistan. Though USand sooncanlc aanctiona thu* far have not bad much impact on them, th* Soviet* are adopting pro-tec'ivo measures in International financial market* and seeking ah er native aourcaa of grain and agricultural goods and credits. They wilt cootinue Io charge lhat the United Stales as using the Polish cslsts to heighten East.West tensions and make West European leaders and publics mora receptive to deployment of new US nuclear missus* in Western Easrecte. Senior Soviet officials appear confident, moreover, that Wertconcerns wiH establish clear qassel to future US sanctions snd policy oxstlena Tbey count oa pressure from NATO Allies lo precJode US suspension of the INF talks and eventually to induce the United States toais for START.

he Soviet leaders' concern about tbe willing-nes* of Polish Army and internal security units to maintain control in Poland probably has been allayed by ihese forces' effective performance In inipiemect-ing martial taw. Tbe Soviets probably have some doubts, however, about the ability of the regime lo rnobiliae round af fl went caused to support miulary operation* against NATO. These concern* may cause some adjustment In So-let ocsnratJorta] planning, but, assises tbs Polish ntuaBcn dctsrrtorales radically, tbe Polish role In Warsaw pact wtir-lighting strategy will probably notbe affect* of tbe nisti aipr dally the continuing economicPoland's plans to modernise its armednd being them op to Pact-wld* standard. of and equipment

Implications for rhe United States

ver the near term, the United States willoland that is internally divided and unable to deal effectivelythe country's pntblems Internal pontlcal exigenciesesperate need for greater Soviet economic assistance will motivate the

NOFOXN/

rV.rti Iredership lo lean farther toward Moscow and adhere Io Hi presente. although this could wellpored by private apocab tn tb* United State* feereaeaalion ei

he United Stats doe* have mean* tortnifleant economic Impact on Poland. It could. Il it denied, contnbuie to the eUeviafIon offood wobletxu. which rnight factbtate atat-llia<wn of tbe regime while at tbe aanva tuncmoderateIt couldontribution,uch tcsacro tbe area of Industrial cooperation. Moat Importantly, the United Statea ttetition toajor Influence over Poland'1 prospect for debt eaactcdullne. credits, and default Tbe US Co.eracould aeek lo block IMFwhich Warsawcounting forillion over the neat five years ft could aboor without West turopeanembargo ell eaporta to Pound and to boycott Poll* goods,

TO If Poland were declared In default by major government! and private creditors, this wouldimited Immediate impact on Polsadt economy be csuie tb* country alreadyeprcaied trade level, virtually no access to new Westernnd faw aasnt* vulnerable le seiaure. Default would rerssare Poland torade surplus In order to pay for all import*ash-and-carry basis. To do this, Poland would probably sHae on default to evade,ayment* to the West, and then me all hard currency eaport earning* to cover lasoorta lut default could neeaoese apeeial satd cuanbersorn* attangement* to carry out trade. More Importantly, it would have an Impcstant psycho-logacalthrough ths open ackrowledgmcni ofcreditor) and would-be creditor* of other East European state* aod of the Soviet Union. Additioatafry. at could, al the very least, daily and complicatettempt to "sin the IMF, thereby poarponlng Important financial asaltfaoce. Overall, it wouldiapMficant. though wAsneasuaabla,on Eaat-Weat trade reiaJions. to the irealsr dettiment of tbe CEMA csjuntrle*.

TI. Sanctiona aaa inn Poland, Including aol default If thii oceurrad, will tend to make Warsaw more dependent on Moscow and Its CEMA partners The longer the aanctiont Last, the nsore

/QKOH

permanent this shift If likely to be. However, this shift will not ail miss* te the undedying long-term need for Poland aod other CEMA countries to develop certain economic and financial lie* wilh the West. Despite predictable regime condemnation of sanctions, the populai attitude in Poland ao far has been generally favorable but could change over time as economic

deprivation grows.

United State* alio ka* tbe capacity,idiobio affect the thiDking of Polesnoraffsclaj orasamuntCalMn in Polaad ofand ideas. Morale among Poles, aod the spiritmay depend somewhaten**has not been forgotten Th* continuousof aD Voice of America and Radio Freeattests to the regime's anxiety abouteffects.

the capacity to affect elements of tbedoc* not moan that the United Slatesleverage raver the Potash regime and tain tbe irate of having the capacity toand Soviet leaden to respondesiredUS cues. US pcenbiliBci ia thai respect areby the stake which both Warsawhave iseliable system ofrule In Poland tbat will be adequatelyoviet Interests Washington can affect thewith whack tba Polish snd Soviet leaderssnd la this way influence their acriorts. butto be able to compel them to sharePoland.

ver theo IS coon tbs snd beyond, the Polish cnals wiHrge potential to affect the Atlantic Alliance, rangingajor disruption to someon what happen* In Poland and tbe reactions of the United Statea and our European partners, respectively. Events In Poland are likely to heighten Allied dlwpprova] of the Polish and Soviet regimes, and alter tome aspects of theelations win the Sovietnam pie. reducing financial relation* and producing sharp eachanges aod perhapsfreezeSCE. But US pressure Intended to quickly reverse tha Allies' major policy line* toward th* Bloc would be likely to becorne major public iMiet, forcing some Wast European governments to raeist rather than cooperate with Washington and perhac* prompting move* counter lo US Inter cats.

n the present martial Uw tirualion. tb* West Curacao* have made ih* Mac fcrmii nam* nil* oo tb* 1'drab res'.me tat Oat Untiedot theynot Irukt on the umc Uriel compliance ai Washington The Alllea probably would be Inclined to by lo(heir relation! with Petard af Wanaw took tome further it rot to end martial law. roltsaaed moatii-n. and loltlaled tha temblanc*ialogue with the Chindletted Solldarltv repfeaenta-Bvea aB croft* cancel vxbk tactic* that th* Poiiih regime mayn thatnlikely thai ponltlv* meaMire* taken thu* (atthe Soviet fOKOH

Union by the Weat European* would be luttalned for kmc.

TS. In turn, within tb* neatoontbt. the Weat cannot hope thnt ear of it* actloo* will lead to genuine political accomraodatioa In Poland. The Weat can hope that the combination of Soviet end Poinh aeedi for Weatera economicon. continued Western resection of* utual. and oormnued naaaive rcUitance to the authorities by the Polish population will have torn* moderating iiafloenca oa the resume andihe trttattrrllTr of long-tara enmnromtse within PrAsh tociety.

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