1.
Ground Forces
Special Study of the Soviet Ground Force
acretary KcKaaara expressed serious concern about the effects on US and SATO policy of estimates that appeared totho capabilities of the Soviet ground force. He askedev and thorough study of the problem by CIA and DIA, to vhich Kr. KcCono agreed. ORR haschairson of the Panel and the bulk of the intelligence analysis. The Panelhose final vork has Just been completedprepared two reports: one re-evaluated the number of major line elements in the Soviet ground force and the military manpower available for that force; the other reported on
the Soviet production and inventory of land armaments. These reports set for the first time raeinlngful confidence limits for estimates of the size, readinessevel of equipment in the Soviet ground, force. Each of the reports, based on exhaustive research and analysis, was drafted and published by ORR with DIA concurrence, c. Policy Usee
Secretary XcXonara expressed his pleasure at the progreGi made through the Panel's vork and stated his beliefuch sounder
SEC3ET
basis for US planning and panning within UXO now exists. "rnnel's findlnge aro also nfeflooted in current NationalEstimates, in the annual policy rccoaroendatlons of tho Socrotary of Defense to the President and in the current comprehensive annual review of Soviet capabilities compiled for planning purposes by SATO.
Soviet Ballistic Missile Production Facilities
smr
Products
Contributions to National Intelligence Projections for5nd CIA/DIA Joint Analysis Croup (JAO) Alternatlvoof Soviet Military.
These tvo documents each have several volumes vhlch contain detailed projections of alternative Soviet weapons programs, force,and costs. They form the basic intelligence guidance used throughout the government in assessing the military threats against vhlch US and allied forces should be planned and progrerzed. Their importance in the planning process is increasing vlth the use of systems analysis and In view of the long lead times which now affect many military programs. Thoso planning documents, prepared at the request of Secretary KcKsmara sxd his staff, thusajor and direct role in the formulation of US policy In the military fields.
mm
ORR military costing specialists, working with computer programs, prepare the detailed costing studies which axe issued as individual volumes of these two basic documents. The results of this work are found in the estimates of Soviet costs contained in Secretary McSamara's annual Memoranda to the President on COD Five-Year Program projections, and in subsequent congressional briefings. In the Arms Control field they are used to gauge the relative attractiveness to the Soviets of alternative disarmament proposals and also to guide the US position vith respect to perennialon the part of the Soviets to reduce military spending. The use of these costing studies is less direct at State and the National Space Agency, but vo are regularly made aware of interest in the results on the part of Mr. Rostov and of Mr. Webb's policy planning staff.
4. US Trade Policy Toward the USSR andope
a. Intelligence Products
Deputy Director, CKS, Sriefir-s,trategicof Western Trade to the SovietOKFIDEHTIAL.
Deputy Director, ORR, Briefing, Prospectsmplications for
Soviet Bloc Trade with the Industrial
Various ORR Background Memoranda and Briefings on Bloc trade Policies,
Practices, Balance of Payments and Technological Gains from Selected
Imports,
In the briefings end memoranda listed above it vas pointed out that Western trade is relatively insignificant in total Soviot and East European economic activity, and that the role of the US in East-Vest trade is negligible. The USSR and Eastern Europe viev the West as an iaportant source of advanced technology for accelerating their" econonlc growth, and have biased restrictive Western trade policies for the failure of East-West trade to expand as rapidly as they had hoped. The major obstacle to the expansion of this trade, however, is not Western restrictions, but the chronic failure of the USSR and Eastern Europe toapidly expanding export capability to the Vest.
While the Western share of both Soviet and East European trade is expected to reasln about the same, regardless of Western trade policy, the removal of US restrictions sight raise significantly the US share in total East-West trade, o. Policy Uses
Tne Briefings and Memoranda were presented in Marchto the Millerpecial committee of distingulsed private citizens convened by the President to review US trade policy toward Eastern Europe and the USSR, and to cake recccsendatlons for future policy. The Cccaittee's report to the President, datedeflected the Intelligence assessments, both on the importance of East-West trade to the participants, and on the likely future course
of this trade. The Committeeelective expansion of US-Connaunist trade in non-strategic Items, and urged that greater use he Bade of trade concessions as an Instrueout of US policy. This report has recently been accepted by the President as the basisroposed codification of US trade policy toward Eastern Europe and the USSR. eaoranduE to holders of SSAKas circulated by McGeorgo Bundy on5 calling for follow up vith Congress along lines of the Millerhe USSR's International Payments Crisis
Products
CIA/RR/ The Soviet Seed for Credits,ECRET.
CIA/RRhe Estimated Effects of Various Possible Levels of Western Credits to the USSR,ONFIDENTIAL.
Briefing Materials for the DCI, The SovietanuarySECRET.
The Soviet payments crisis of3 was the culminationeries of annual hard currency deficits incurred by the USSR9 cn. It was precipitated by the disastrous Soviet harvesthich forced the USSR to draw down its gold reserveew low in order to pay for imports of Western wheat,0 dlllon. The chronic Soviet deficit, which was caused by the USai'a failure to generate enough exports to pay for its
SEGIET
rapidly growing imports of Wostern equipment, was financed by sales of gold and by drawing on the aedlus-term .credits available in the West. OBR estimates indicated, however, that the Soviet gold reserve had been reduced to2 billion by the endnd5 billion at the endh after payment for the groin Imports. Furthermore, drawings against medium-term credits were being largely offset by the growing volume of.
Our conclusion was that the USSR faced Importantecline in its ability to Import Western capitalwhich vould be eased significantly if Western countrleo came to Its rescue vlth substantial long-term credits. Policy Uses
Through the reports listed above, as welleries of direct briefings, tho DCI, under Secretary of State, Ball, the White Kouse^ Staff (the requestor of EHnd various congressionalwere Informed of the Intelligence assessment of theard currency crisis, and of the urgent need of the Soviets for long term credits. Inhe Administration instructed the DCI to -convey this assessment to government leaders in Western Europe, and to urge that the West unite In denying long-term credit
facilities to the Soviets, at least until the possibility of exacting
on equitable quid pro quo could be explored. U Under Sacre
tary Ball and other State Department officials made similarto the JCA20. 7 .
ECRET
These reports and related materials vere also drava on by the CA Staff, DD/P, and by USIA for use In propaganda programs abroad. 6. The Effects of Economic Interdiction Against North Vietnam a. Intelligence Products
CIA/RRoreign Influence on the Worth Vietnamese Economy,
ECRET/
Memorandumbility of North Vietnam to Shift Current Seaborne Trade to Rail Transport,SECRET,
Trade vlth Free Worldk,ECRET/
CIA/RR, Merchant Shipping to Korth Vietnamk, March'
Memorandumattern of Rorth Vietnam's Seaborne Foreign
Memorandumhe Dconomic Intact ot Possible Intcrliction Measures Against North Vietnam,ECRET/ b. Findings
The ORR studies Indicated that the economy of Rorth Vietnam is not vulnerable to measures taken solely against Free Wot Id shipping to North Vietnam. Even if measures vere expanded to deny all sea and rail access to Worth Vietnam, the economic impact vould be rather limited, llorth Vietnam isubsistence, agrarian economy.
segzet
SECFJT
It couldevere disruption of lta small modern Industry sector and still maintain its military activities in South Vietnam. Ve found, moreover, that vhile combined sea and rail interdiction vould nave the greatest impact, simultaneous Interdiction of tbe three major rail lines vould produce results of almost equal Ball Interdiction would also avoid accelerated escalation and the many political and diplomatic problems associated with sea Interdiction. Policy Uses
Tne studies listed above vein undertaken at the request of the Chairman of the Subcommittee on Free World Trade and Shipping with North Vietnam. Thio Subcommittee vas created iny Ambassador Leonard Unger, Chairman of the Interdepartmental Vietnam Coordinating Committee, to study all possible economic interdiction meas'-ores against North Vietnam.
esult of these studies and the Subcommittee findings, the Secretary of State accepted the recoccendation of Ambassador Ur.ger that the US should notaval quarantine against Free World shipping to North Vietnam because it vould fall to damage North Vietnam'and vould create severe diplomatic problems with several friendly countries. Secretary Rusk resorted, therefore, to bilateral and unpubliclied discussions with the countries involved.
Having considered the alternatives for Inflicting damage on the North Vietnamese economyhrough attack against rail lines,
y 9
SEC H
SECRET v
mining of barters, or blockade) Ambassador linger and Assistant Secretary Eundy apparently endorsed our views regarding theadvantages of attacking rail lines. 7. Origin and Mix of Viet Cong Weapons
Reports and Findings
weapons captured from the Viet Cong were identified to be Chinese Communist manufacture and established as produced in the3k.ew family2 mm veapons using the same ammunition vas identified
1
to be comprised of the semi-automatic carbine, the light machine gun, and the assault rifle.
Uses
This information vas used directly in the Department of State "White Paper": AGGRESSIOH FROM TBE NORTH, releasedndublic statement on this subject by Secretary of Defense,obert McHamara. It was of considerable importance in publicly dramatizing the Chinese Communist role in providing military support to the Viet Cong.
ORR/CIA
5
A large part of ORR'a analytical effort supports regular and. special national estimates in the military and military-economic, and economic fields.
The military effort is dovoted to the analysis of foreign military and space capabilities and their associated costs. Geographically, emphasis is placed upon the offensive and defensive capabilities of the USSR androwing extent upon those of Communist China. esser effort is devoted to the European Satellites and to the analysis of Free Vorld countries which areuclear weapons delivery capability. Substantive priority is given to the analysis of the threat to the continental US, to its allies and forces abroad, and to the capability of countering the US strategic attack capability.
In the economic field, OR? analyzes the capabilities, priorities,rates of growth, snd stability of the USSR, Eastern Europe and Asian Communist countries, and on selected Free Vorld nations as well. Each area presents its problems of peculiar interest. In the USSR, vo are especially concerned with its attempt (faltering badly at the moment) to catch up with the US economy, with recurring grain shortages, and with the burden of defense on the economy. The work oil Eastern Europe focuses especially on conaumor satisfaction or lack of it, on the stability of the economies, and on the groping efforts of the various regimes to reform, liberalize and/or reduce their dependence on the
USSR. China challenges our research with its awful nalthuGlan problem, the problon of nuolear progress, and prospects for rosuaptlon ofdevelopment, in dealing with Free World areas we supplement and test the contributions of the Department of State, confining our efforts to countries and situations of greatest importance to US security.
HISoviet Capabilities for Strategic Attack, now in process, illustrates the role ORR plays in the formulation of notional estimates in the military field which in final form represent the coordinated views of the Intelligence community. ORR published acontribution which vas forwarded to OKE for consolidation with other contributionsraft for consideration by theof the members of USIB as pert of the process of reaching an agreed draft for USIB consideration. The ORR contribution was the product of basic research and analysis of the strategic threat posed by the Soviet capability to produce and deploy strategic offensive weapon^ systems such as intercontinental and intermediate range ballistic missiles, long range bombers end missile submarines. ORR continues to participate In the estimating process through support to CHE and by attending meetings held by USIB representatives to discuss proposed drafts of the estimate.
ORRirect Influence.on the whole range of foreign military estimates through similar contributions mode to estimates on defensive weapons systems, apace, general purpose forces and special subjects.
The estimates of military capabilities ot Communist countries provide the policy makers with an understanding ot the potential enemy threat present and projectedwhich must be countered by the implementation of US policy decisions. The analysis of Free Vorld military capabilities provides the policy maker with anof the influence allies or neutrals might have in hindering or implementing US policy decisions.
The story of the Soviet economic slowdown and its causes,in the National Estimates and in ORR reports, has been one ofsignificant of intelligence findings of recent years and onemost heartening. The conclusion that Soviet economic troublesrooted in the system and hence not subject to quick andhas been widely disseminated to policy levels and isat many levels of dealings with our opponents, ourneutral
orr/cia
5
/3,
Original document.
Comment about this article, ask questions, or add new information about this topic: