CURRENT INTELLIGENCE WEEKLY REVIEW

Created: 11/6/1958

OCR scan of the original document, errors are possible

CURRENT INTELLIGENCE WEEKLY REVIEW

68

THE WEEK IN BRIEF

F IMMEDIATE INTEREST

TENSIONS

1

public announcementovember ofimminent departure from Jordan on vacationto increase Arab apprehensions thatcould lead to Israeli military action. Thelis are ready to move If pro-UAR developments

Inrecautionary alert.

November canceled the alert of its grouod forces, those earmarked for possible intervention Iraqi forces presumablyin positionon short notice.

IN IRAQ

2

as it has refrained from attributing Arifs

o the UAR.

Forces for and against union with the UAR areto compete for influence in Baghdad, with Prime Minister Qasim tending toore pronouncedposition in the face of UAR-lnsplred agitation. The threat of open clashesarge scale between the two sides may have been avoided by the arrest of former Deputy Premier Arif, who returned unexpectedly tofrom Viennaovember. The Baghdad regimedoes not want any open break with Nasir at this time,

"plotting" to the UAR.

STRAIT SITUATION

3

has attempted to maintain the Initiative on the offshore islands issueild blend of political and minimum military action. ne-day burst of heavy firing on the Chinmens, propaganda charges that the Nationalists have UHOd noison ma.

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continued)

SOVIET MOVES IN GENEVA TALKS Page 7

At the opening session of the Genevadiscontinuance ol nuclear weapons tests, raft agreement which calledimmediate, permanent test ban. He assertedprepared for detailed negotiations on abut only after the United Statesermanent cessation of tests. Theof Soviet testing after the opening of thereflects the Soviet leaders' concern thatof their tests might be interpreted asof the Western proposalne-yearwhich, in Moscow's view, would dangerouslySoviet freedom of

PART II NOTES AND COMMENTS

PEIPING PUSHES CONSOLIDATION OP PEOPLE'S COMMUNES . Page 1

Peiplng is pushing ahead with the more extremeaspects of its communalizatlon program. Reports from mainland China indicate some peasant unhapplness over the changes, but no active opposition has been noted. Pelping claims that overercent of the poor and middle peasants in one area activelythe move; such opposition as was encountered came from comparatively well-to-do peasants, who had the most to lose. Steps are being taken to extend the system to urbanommune has now been identifiedining district of Shansiembers,actories and mines, and 75

BLOC REACTION TO CHINESE2

China's headlong drive to establish "people'shas elicited only minor and noncommittal public comments from the USSR, which may have misgivings about the Chinese innovation, Moscow and Eastern European

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THE WEEK IN BRIEF

CURRENT INTELLIGENCE WEEKLY 8

PART II (continued)

satellite commentary is agreed that this experimentnly applicable to China, but variations in press handling suggest that Moscow Is still undecided how best to treat the Issue.

REVERBERATIONS OF PASTERNAK'S NOBEL PRIZE AWARD Page 3

Soviet leaders appear to have abandoned any Idea they may have had of forcing Pasternak into "voluntary" exile. The regime may now hope to reaffirm theof "socialist realism" in the creative arts in less virulent terms.since the violence of its first attacks has made them counterproductive. Popularinterest in Pasternak has been intensifiedby the vehemence of the attack against him and has begun to have an adverse effect on the USSR's program for cultural exchanges.

SOLIDARITY STRESSED DURING GOMULKA'S VISIT

TO USSR

Speeches during the visit of Polish party secretary Gomulka to the Soviet Union have been filled withof "undying friendship, solidarity, mutual aid, and socialist progress," Formal substantive talks reportedly are not being held during the visit, although Khrushchev has offered Gomulka "friendly advice" on such problems as recollectivizatlon, control of the Catholic Church, and excessive freedom of expression.

4

PUBLISH NEW FIVE-YEAR PLAN5

The goals of Poland's Five-Year Plan, which were published in connection with the October meetings ofh plenum of the party centralreflect party Secretary Gomulka's confidence in continued loose economic relations with other bloc countries and the same realistic approach to economic planning he has shown since his accession to power The new plan-calls for an increase in industrial production ofercent over0oal considered too modest by some of the planners at the plenum. The projected rise in the standardrobably not greatlythe dissatisfaction with poor living conditions, but it will reduce some of the worst

HUNGARIAN REGIME CLAMPS DOWN ON CATHOLIC CHURCH Page 7

The Hungarian Government recently forced thespecial representative to the Catholic Church in Hungary from office and has made other moves to isolate

ill

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PART II (continued)

the church further from outside influences and to destroy itymbol of Hungarian nationalism. While generally not using the police-terror tactics common in the Rakosi era, the regime has usedpressure and police harassment to restrict the activities of the local parish priests and to force members of the church's hierarchy t6 conform. The status of Cardinal Mindszenty, long separated from church affairs andonvictedby the regime, does not at the moment figure in the controversy.

USSR ACTS TO INTEGRATE BLOC TELECOaTMUNICATIONS. Page 8

The USSR, intent onunified system of telecommunications" within the bloc, haseries of intrabloc conferences to this end, and a: new organization has been formed of all bloc members. Specific plans have been made to modernize facilities and standardize equipment and procedures.

SOVIET ECONOMIC DELEGATION TO VISIT THE SUDAN . Page 9

The USSR's economic delegation scheduled to arrive in Khartoum in mid-November probably will find theand economic climate considerably more favorable to amcourage Sudanese acceptance of aid than in the past. The Soviet delegation probably will propose large-scale assistance for the Sudan's economic development program. In addition to machinery, materials, and technical Moscow may offer some foreign exchange in,for Sudanese cotton

BRITAIN'S PROBLEMS IN Page 9

The recent anti-British rioting in Aden Colony highlights the difficulties London faces in itsto retain some influence in the southeastern Arabian peninsula by granting timely concessions andew propaganda effort against UAR Influence. London hopes to inaugurate the Western AdenFederation by next April, link Aden Colony toew years later, and grant itwithin ten years. Meanwhile, Britain plans to hold Legislative Council elections in Aden Colonyairo.radio is callingoycott of them.

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II (continued) INDIAN COMMUNIST PARTY DEVELOPMENTS . . .

Page II

sharp policy debate being waged within the Indian Communist party leadership may resultradual shift in tactics away from the present "peaceful" approacha somewhat harder line. Factional infighting has Intensified during the past two months as the party's position in Kerala State has grown more difficult and the national strategy adopted in April has comeInto question.

POLITICAL AGITATION IN CEYLON Page 12

The Ceylonese press and opposition parties arethe Bandaranalke government, following theof some emergency regulations. The island's economic deterioration is the principal anCigovernment theme at well-attended political meetings of the United National party and the Trotsky!te Lanka Sana Samaj partyhe LSSP may stage soma strikes based on economic de-mands and designed to harass the government.

_

LAOTIAN GOVERNMENT'S POSITION PRECARIOUS Page 12

Laotian Prime Minister Phoui Sananikooe is meeting bitter resistance to his reform program from theRally of the Lao People. Re feels he lawo-frontthe Communist-dominated Neo Lao Hak Zat and against his own party. This opposition will seriously hinder his efforts to reverse the Communist trend before the national elections lnisgruntled deputies may seek an early opportunity to oln with tbe opposition to oust the government.

TO SARIT DEVELOPING IN THAI MILITARY GROUP

Marshal Sarlt seems to be faltering ln his efforts to renovate Thailand's political institutions. Certain key leaders of his military group are becoming impatient with his tendency to retain the right to make all If Sarlt continues to Isolate himself from the group and delays too long inabinet which will accommodate its interests, he will becomevulnerable to attempts to oust him.l

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CAMPAIGN AGAINST CHINESE NATIONALISTS .

The Indonesian Government's growing drive against pro-Kuomlntang elements was begun in retaliation forsupport of the dissident movement, but long-standing

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PART II (continued)

racial antipathy Is giving it impetus. Therecently closed all remaining pro-KMT Chinese schools, leaving those of pro-Peiping orientation. Seizures of Chinese businesses, which follows similar action against Dutch interests, will further aggra-vate Indonesia's economic ills.-

PEIPING MAINTAINS HOSTILITY TOWARD TOKYO Page 15

Communist China shows no sign of softening its harsh conditions for resuming trade or culturalwith Japan.

MAY EXPAND TRADE WITH SOVIET

Brazil's approval onctober of Its firstbarter deal with the USSR,mall quantity of Soviet crude oil in exchange for cocoa, is one ofindications that the government may respond favorably to more of the bloc's many recent trade and barter Publication in Brazil onctoberewby Soviet Premierprevious calls for formal ties withlikely to revive public debate on the issue of diplomatic relations

POSTELECTION SITUATION IN CUBA

17

easy victory of Andres Rivero Aguero, President Batista's hand-picked successor, inovemberelections has not improved prospects for endingtwo-year-old civil war. Rivero is unacceptable to the Fidel Castro rebel movement.

ECONOMIC PROBLEMS

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economic and financial situation remains precarious,ise of0 in its gold and dollar reserves since May which resulted mainly from the special internal gold loan of last summer. Trade and payments balances continue to be adverse, and experts of the European Payments Unionevaluation of the franc may be necessary soon. The government'soutlook is complicated by the imminence of renewed

CURRENT INTELLIGENCE WEEKLY8

PART II (continued)

wage demands and the likelihood that De Gaulle'sproposals for Algeria will be at least aa costly as military pacification.

EUROPE'S FREE TRADE AREA19

The OEEC's Intergovernmental Committee od aFree Trade Area plans further sessions onndovember In an effort to break the Impasse between France's demand for protecting its industries andinsistence on freer access to the Continentalwithout prejudicing its world trading Interests. The course of events atctober meetings, however, suggests that theations Involved are unlikely to reach agreement until London and Paris work out some deal, probably Involving more than economic questions.

PART III PATTERNS AND PERSPECTIVES

THE ITALIAN COMMUNIST PARTY: STATUS AND PROSPECTS. Page 1

Italy's Communist party, the largest outside the Sino-Soviet bloc, continues to maintain its appeal to the electorateecline in actual partyand friction among leaders that may lead to anshake-uprospective party congress in These handicaps are offset by the Communists' persistent appeal to the protestnotchallenged by otherby their continuing dominance of the labor field. Their future in Italy dependsarge extent on theaken by the Nennl Socialists.F

I'fl THS I'd IX Iff INKS

4

drift in the Philippine economy and the decline of political integrity and efficiency since Carlos Garcia became president are causing growing popularand mounting criticism even from Garcia's own party. The recent political focus on Defensean who could restore strong leadership,

J Moves by Garcia in the direction ofpolitical interference with the armed forces, and his

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PART III (continued)

continued failure to check the slow economic deteriora-tion, may intensify military discontent, f

COMMUNIST REGIMES IN EASTERN EUROPE REGAINING STABILITY . . Page 7

Despite considerable diversity In internal the regimes of Eastern Europe haveubstantial degree of stability and self-confidence since Most of the satellite leadersto have benefited from the increased authority and direction which Khrushchev's present blochave given them in dealing with partybureaucracy, industrial inefficiency, anddissldence among the general population. The USSR's success in achieving bloc unity andits control may be diluted in the long run, however, by individual state interests and demands for locally oriented party programs, p

SURPRISE ATTACK IN SOVIET MILITARY DOCTRINE Page 12

4 the role of surprise attack has beenincreasing weight ln Soviet military doctrine, andarticles by Soviet military theorists recognize its importance in modern warfare. Perhaps to avoid thethat the USSR could be defeatedurpriseand reflecting Soviet rejection of "adventurist"on surprise, other important factors, such as the economic base and geography, are still stressed.I

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CURRENT INTELLIGENCE WEEKLYovomber8

F IMMEDIATE INTEREST

ARAB-ISRAELI TENSIONS

fears of anon Jordan havebut may well with the publicthis week that Kingto leave the countryNovemberuropean Husayn has made aJordanian militaryln preparation for his

| Tne

last British combat troops left from the port of Aqabaovember.

Husayn will leave thela the handsegency council composed of moderate individuals with limited powerswill not be able, for example, to accept theof the prime minister. While Husayn and Prime Minister aifal have dismissed as gossip tbe suggestion that Husayn may not be planning to return to Jordan, tha realisation that the entire royal family will be absent during this period

< s

SAUDI ARABIA

il rnflneiy

Pumping station

OH pipeline Railroad Mam motor road I

CURRENT INTELLIGENCE WEEKLY8

produced widespread rumors and is contributing to afeeling of uncertainty and apprehension.

A new clash between the Israelis and tbe Syrians over Israeli operations in tbeof Lakes Hula and Tiberias appears to have been avoided temporarily. These areas were the scene of considerablelast sprlngf

/ In response to requests

from UN truce officers, tho Israelis halted their work, at least temporarily.

a state of alert is still being maintained in the UAR, but there has been no large-scale mobilization. TheNavy has sent twosouth through the Suez Canal, possibly destinedfor the new base at Ghar-daqa (Hurgada) on tbe Red Sea. This would be the center for any Egyptian naval operations against the Israelis in the Gulf of Aqaba.

Iraqovember called off the state of military alert it had been maintaining,that for units earmarked for posslblo use in Jordan.

israex retains, however, the capability of operating against West Jordan with the" troops now on duty, need to mobilize only after it had launched an operation.

SITUATION IN IRAQ

for and againstwith the UAR are continuing to compete for Influence in Baghdad, with Prime Minister Qaslm tending toore pronounced antiunion position in the face of UAR-inspired agitation. The threat of open clashesarge scalethe two sides may have been avoided by ths arrest of former Deputy Premier Arif, who

returned unexpectedly to Baghdad from Viennaovember. Arif, who earlier had asked and been refused official permission to drop his assignment as Iraqi ambassador to West Germany and return to Iraq, is scheduled for trial on charges of plotting against the state.

Arlf's arrival followeday the departure of UAR

CURRENT INTELLIGENCE WEEKLY8

of Culture Husayn, whose visit was made thefor demonstrations by pro-and antl-UAR groups which in some cases were accompanied by violence. During the clashes, the police stood aside, and the intervention of the armyto favor the anti-UAR demonstrators, who werelargely organized byelements. UARcalled this situation to the attention of Qasim and pressed himtatement of his attitude toward union with the UAR, but were put off.

These developments are leading UAR officials into the conclusion that the trend in Iraq is against any close association with Cairo, and they tend to attribute this to Communist influence. The UAR military attache reportedovember, for example, roup around Kamileftist and one of Qasim's

principal civilian advisers, had decided to drop ths slogan of "federal union" with the UAR and wished instead to work to detach Syria from the union with Egypt. The attachethat "Communists" would soon begin to agitate in Syria toward this end.

The UAR has beenpro-UAR elementsto the extent of promoting agitation among junior army officers who feel they are not adequately represented in the regime, but Cairo appearshow to handle thopublicly. Cairo propaganda media have not commented on the news of Arlf's arrest, and Naslr may wish to remain silent on this evidence of Iraqito the expansion of his Influence. Baghdad, too, probably does not wish any open break, partly because it is still relying on the UAR's military strength for defense.

TAIWAN STRAIT SITUATION

China's Premier Chou En-lal and ForeignChen Yi have both recently made statements intended to create the impression that Pel-ping is "in no hurry" to resolve the Taiwan situation.

in, editor of Hong Kong's major Communist daily news pa per,|

[was summoned toid-October for an interview with Chou En-lai, In outlining Chinese Communist policy toward Taiwan, Chou told Fei that "with tbe passing of time, the Nationalists might come around to the idea ofa settlement with Fei may have passed on

the information knowing it

wouldestern government.

Chou declared that thedid not want to use force to capture Taiwan or to press the Nationalists "toos the reaction would be adverse to Pelping's internationaland might cause theto yield "totally" to American demands. Chou said he believed UN members havemore friendly toward the Communists, and his government does not wish "to spoil this gain" and endangerhow of force in the Taiwan area its chance of entering the UN.

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CURRENT INTELLIGENCE WEEKLY8

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Chou added that war wouldthe Chinese Communistof construction and that Peiping does not wish tothe "trend toward

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Communists arstheir efforts toTaiwan that negotiations with Pelping offer the best hope forfuture and to to ths world that tha Nationalists, being Chinsso,

will eventually deal with the?

mainland regime. /

esides At-

tempting to emphasizere-turn to thehs shelling was probably intended to dispel any notions that Pelping will allow tension in the area to subside at this time. The Coauaunlsts' warning from ths "Fukienhich precededovember outburst, reminded "compatriots" on Chinaen of the "odduggesting that Pelping hopes it can force the Nationalists to resupply only on Communist-designated dates.

Poison-Gas Charge

ovember, Pelping charged that the Nationalists had used shells containingpoison gas" in the heavy exchange of fire the day before. This is ths first time in this strait situation that tbehaveharge of this kind. Asovember there had beenimited follow-up in Chinese Communist and other bloc propaganda media. The Nationalists used alarge amount of whitein their counterbattery fireovember, but this kind of ammunition has been used before by both the Nationalists and the

CURRENT INTELLIGENCE WEEKLY REVIEW

68

Chiang-Dulles Communique

Following the Chiang-Dulles communique, some Taiwan "liberal' and anti-Kuomintang newspapers have begun to call for "realism" in admittingationalist counterattack against thecannot now take place. These newspapers urge the repeal of repressive measures such as the restrictive publications law as "political" preparation for recovery of the mainland.

One newspaper notes that the convening of anNational Salvationrepresenting all freewould raise the morale of Overseas Chinese and promote the political offensive against the Communists. This probably represents liberal aspirations for an effective oppositionto the Kuomlntang, which might stem from such a.

The reaction of Asianloaders to the Chiang-Dulles communique varied with the political outlook of the government. Governments which support the Chinese Nationalists, such aa those of South Vietnam and Thailand, and others which are pro-Western, like Malaya and Japan, welcomed theas relaxing dangerous tensions. The official Soutb Korean attitude was one of

j The neutralist reac- "

xion waa noncommittal. Asia, the communique relatively little public and press attention.

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SOVIET MOVES IN GENEVA TALKS

the opening session onctober of the talksuclear testagreement, Soviet delegate Tsarapklnlearbetween the American and British calltemporary one-year suspension" and the Soviet positionessation of nuclear tests sarapkln thenraft proposal which calledermanent test ban andto establish controlto supervisean. He said he was prepared fordiscussions on thequestions concerning the control system, but only after agreement was reachedermanent cessation. repeated the usual Soviet position that, despiteinequality with Western tests, Moscow would ceaseimmediately if the United States and Britain agreedermanent cessation.

ovember ln anmeeting Tsarapklnroposed agenda for ths talks,ermanent test-ban agreement ahead of discussion of the control system. At the second meeting;ovember Tsarapkln argued that theposition of settingontrol system forone-year" suspension wasimplying that Moscow believes the West has noof continuing the bana single year. At the third meetingovember, Tsarapkln stated categorically that ths Soviet Union would agreeontrol system only if the West agreed to acessation and thatthe question of control would become pertinent onlysuch conditions.

The continuation of Soviet testing after the opening of the Geneva conference probably reflects Soviet concern that suspension now might beas acceptance of the US-UK one-year test moratorium which, in Moscow's view, would dangerously restrict Soviet freedom of action. The Soviet delegation at Geneva can be expected to stand firm on its proposalermanentban. The Soviet leaders probably hope they can bring further pressure on the Western position by warning that theill halt its tests only after the United States and Britain agree to this proposal.

The decision to continue testing may have resultedast-minute reappraisal of the Western poeltlon in the light of Secretary Dulles' statement ofctober that the US-UK proposal "Involveswo-yearoscow may have Judged that this Statemont foreshadows

PART I

IMMEDIATE INTEREST

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CURRENT INTELLIGENCE WEEKLYovember8

flexibility la thethan it bad sarller believed to be the case.

As late asctober,

suggested that Moscow intended to withhold further tests at least during the initial phase of the Geneva talks. *

J Onctober, So-

vTet Deputy Foreign Minister Zorin implied that Moscow would

resume testing only if thstalks failed to produce agreementermanent and unconditional test cessation.

However, onctober, Moscow shiftedarder line, asserting in an officialthat it would continue testing "turn long as theof ths United States and Great Britain continue to wreck The Russians may calculate that this reversionarder line, including further testing, would be tho most effective way of forestalling Westernimoves toward'the Soviet position, V* which coaid seriously embarrass

Moscow. I

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PART IIAND COMBWS

PEIPING PUSHES CONSOLIDATION OF PEOPLE'S COMMUNES

Chinese Communists are pushing ahead rapidly tothe new "people's communes" in rural areas and to establish them in the cities. Only minor opposition has been encountered so far, despite evidence that the more extreme aspects of theofmesa halls and nurseries, relocation of bousing, and the disruption ofactively implemented.

survey" in a in Honan Province where the commune system was firstPeiping announced that overercent of the poor and middlewhom thehas relied heavily inof thissupported the communalization drive, percent "swam with theercent "impeded or opposed" the movement.

The little oppositionthus far has come largely from the comparatively well-to-do peasants, who have reason to fear, as Peiping put it, "the sharp knife cutting the roots of privateeiping admits that suchincited poorer onesfew" instances to kill fowl and hogs, eat and drink excessively, and dissipate common fundsto the collectives.

Peiping says theof such aspects of the program as common barracks, mess halls, and nurseries, which will "replace the familys an "important key" incommunes.

In three separate areas of South China's Kwangtung where the family tradition

is wqll entrenched, wholehave been razed and the populace moved into barracks where as many asre assignedoom. Families so assigned are split up, and Individual members are frequently sent into different districts. People are fed in common messes. Children--de-scrlbed locally as "Mao'staken from their parents, who thenceforth see them only rarely. Whileare apparently unhappy over the situation, no activeto Peiping's efforts has been reported. onsiderable amount of discontent, however, is reported in the Foochow area over the distribution of housing.

On the economic slds, it is possible that tbe majority of communes remain largely paper organizations. This is inwith Peiping's proposals to concentrate first on the top administration of the newleaving the oldand management system relatively unchanged. Early trade and financial problems arising from the communes are being attacked by making the communes "unconditionally"for the fulfillment of state plans for the procurement of farm products, for selling their members all Items which come under the state's sales plans, and for computing as well as collecting all taxes due the state. local trade and financial institutions are being handed over *to the communes. Theof financial and trade power ln the hands of the communes will probablyanother of Peiping'sof restricting individual consumption ln the interest of Increasing the

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CURRENT INTELLIGENCE WEEKLY8

of common funds in the commune.

The new commune system is being actively extended toareas. The officialDally has stated that an experiment with urban communal living got started in Sh&nsl Province "at the beginning of thshen housingin the Yangchuan mining

district were reallocated. mess balls and nurseries were setup later. The daily now refers to this as the "Yangchuan Mining Area People's Communes" and says Itotal population,

as well asactories and

mines andillages.I

J

BLOC REACTION TO CHINESE COMMUNES

headlong drive to establish "people's communes"most revolutionary program in recent Communist history--has elicited only minor andpublic comments from the USSR, which may haveabout tbe Chineseto follow an Independent and untested road to Communism. Moscow and Eastern Europeancommentary is agreed that this experiment is applicable only to China, but variations in press handling suggest that Moscow Is still undecided how best to treat the issue.

The doctrinal aspects of tbe communes campaign may have aroused apprehension thatmight undercut Moscow's leadership In the Communist world, including the USSR'sto define the path of "socialist development." Bold, unqualified Chinese assertions that the commune is the best organizational formransition from socialism tos well as that it will eventually become the basic unit in Communist society, go much further than any Soviet claims for its owninnovations. Ths Soviet leaders do not claim to have finally found the correct form for tbe "transition to Further, the Chinese now are erywhich the Soviet Union itself rejocted ins.

The Chinese initiative may be particularly embarrassingime when Khrushchev is

undertaking his own extensive modifications in tbe Soviet countryside. Moscow isarge dogree hamstrung, however, by the necessity of preserving the appearance of bloc unity.

The Soviet press hasthe full text of tbe Chinese central committeeestablishing the communes, and it has printed several articles by Chinese officials in which optimistic claims for the new system ware repeated. Very few of Moscow's ownon tbe communes havehowever, and those have been largely descriptive in nature, conspicuously ignoring the Chinese claim of rapid "progress towardone of the Soviet leaders has commented publicly on the development.

Soviet commentariesctober, tho Chinose Communist national holiday, ignored the commune movement, although this

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the most prominent feature of Peiping's National Day In the'slogans fort anniversary of the October Revolution, Moscow hailed the Chinese as people who, like the satellites, are still "buildingut no gestures whatever were made towardthe rapid approach of Communism, as Peiping has claimed.

A passage from the Chinese central committee directive was alteredecent article in Izvestia. The original passage stated: "The establishment of Communism In China is noemote future event"; Izvestia, however, substituted the word "communes" for "Communism."

Only one Soviet article, published in the October issue of Questions of Economics, has broached the Taeoiogical issue. The article does applaud the communebasic socialof thes well as ameasure "for building socialism in the shortest time and for the gradual transition toevertheless It is stressed that thisis suitable only for the Chinese.

Eastern European comment has been less restrained than that of Moscow in discussing the communes, but there has been no suggestion tbat the system is

applicable outside China. The commune has been described, and the people have been Informed of the Chinese claim that itignificant "step toward Communism."

The Slovaks, for example, -ere told: "Here is an embryo of Communist society." readers have learned that every development toward Communism in China will sooner or later have its effect Inbut that the communedoes not appear directly applicable to the Hungarian scene. The Polish press has insisted that the Chinese"cannot behe Poles explicitly deny that "democracy" will be endangered In China by this experiment, but they seem to betray their apprehension by so doing.

The Bast Germans, Czechs, and Hungarians go considerably beyond Moscow's reservedand show enthusiasm for the commune system Insofar as it is applicable to thescene. East GermanGrotewohl, the only bloc leader to comment on the communes thus far, praised them peech on 5as splendid development ln China" which has "started the people on tbe road to Communism."

REVERBERATIONS OF PASTERNAK'S NOBEL PRIZE AWARD

the publication of Pasternak's letter beggingnot to force him to leave the USSR, the Sovietappear to have abandoned any idea they may have had of inducing the Nobel Prize winner into "voluntarily" leaving,and they halted the flood of prSBs abuse.

econd letter from Pasternak was Addressing himself to the editors of Prayda, thereaffirmed the voluntary nature of bis actions and his strong ties with his country. He expressed regret that he had not been aware of thetbat his novel might

CURRENT INTELLIGENCE WEEKLY8

misinterpreted as an attack on tbe Soviet system and that corrections had not been made before publication in Italy.

The regime may now hope to reaffirm the discipline of "so- 'cialist realism" in the creative arts in less virulent terms, since the violence of its first attacks has made them

Popular interest inworks, which wasby the Nobel Prize award, has been greatly intensified by the vehemence of the Sovietagainst him. Typewritten copies of Pasternak's poems are apparently getting wideion,and an Italian publisher has estimated thatussian-language copies of the prize-winning novel, which were, disseminated at the Brussels Fair, reached the USSR. Aat Moscow University who denounced Pasternak in the strongest termsraitor to the people was confronted with heated questions fromas to why they were not trusted to read Dr. Zhlvago and make up their own minds about it.

The episode has begun to have adverse effects on theprogram for culturalwith foreign countries, and it has done much to damage the USSR's standing abroad. From Moscow's point of view, the reaction in the Asian-African neutralist countries has been

particularly serious. Fora Rabat dally newspaper, Al Alam, rarely critical ofpolicies, commented that whatever charges the USSR may bring against the West in the future, it "will never be able to deny its suppression of Pasternak." Several publishers in Cairo are apparently anxious to publish Dr. Zhlvago in Arabic. The Times of Karachi noted that this "despicable Incident"complete farce" of the much-trumpeted Afro-African Writers' Conference.

The Brazilian paper Ultima Hora, which has in the past' taken the lead In movementsapprochement with Moscow, termed the incident an act of "cultural terrorism" and mourned that hopes for greater cultural freedom in ths USSR had been dashed.

There havo been demands in the Norwegian press that the cultural exchangerecently signed with the USSR be abrogated. wedish-Russian youth exchangefor the end of this year may be postponed indefinitely to underscore Swedish of the Soviet attack on Pasternak. ublic protest signed byustrian writers urged that all future Western contacts in cultural and scientific fields be madeon Pastsrnak'srehabilitation, bothoviet citizen and as riter. I

SOLIDARITY STRESSED

Speeches during the visit of Polish party secretary Go-mulka to the Soviet Union have been filled with expressions of "undying friendship, solidarity,

DURING GOMULKA'S VISIT TO USSR

mutual aid, and socialist Formal substantive talks reportedly are not being held during the visit, although Khrushchev is said to have

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Gomulka "friendlyon Polish internalwithout putting anyon him,

Khrushchev thought the Poles should move as rapidly as possible toward recollec-tivlzation. He particularly stressed the necessity ofthe Catholic Church under control, and warned againstexcessive freedom of expression in Poland. Poland and other Eastern Europeanshould also be on guard against Western maneuvers to use satellite circlesoans of interfering in Sovietaffairs, Khrushchev asserted.

The Russians have given the Poles the same "red-carpet" treatment they gavehard-line Stalinist leader Novotny during his tour of the Soviet Union last summer, Khrushchev apparently wishes to demonstrate both to the bloc and to the West that he hasGomulka. ovember the Soviet premier said: "There are no issues separatingnone on which we have someopinion different from the point of view of the Polish comrades."

Relations between the USSR and Poland have improvedin recent months, despite an apparent absence ofconcessions by either side. Khrushchev now seemsthat Gomulka is capable of maintaining control inImportant consideration for thethat he will continue to advance the cause of Communism in Poland.

Throughout the tour, the Poles have refrained from the usual slavish satelliteto the leadership of the Soviet Union in the "socialistut have emphasized that their alliance with the USSRardinal point of Polish policy. Gomulka has consistently maintained his basic position on the "Polish road tobut on one occasion he spoke of the "honorary,leading role" of theCommunist party. This iu as far as he has ever gone in conceding Soviet leadership of the bloc. The Poles have stressed, however, theand advantages ofthe "friendship and monolithic unity of thecountries."

In several speeches Gomulka blasted the revival of German militarism and warnod that West Germany's hostile attitude Is nothreat to Poland, but also to the peoples of the Soviet Union. Gomulka voiced his assurance that "socialist unity and the Warsaw Pact" stand as inviolable bulwarks against German revanchlsm.

POLES PUBLISH NEW FIVE-YEAR PLAN

directives for Poland's Five-Year Plana program characterized by the same realistic approach to economic planning that party Secre-retary Gomulka has shown since his accession to powerhe proposed increase inproduction ofercent above0 level isthe same as the rate of growthbeingin the present five-year, after Gomulka cut back its goals inhe planned growth in Industrial

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CURRENT INTELLIGENCE WEEKLY8

Hungarian Government in recent months has beenits stranglehold on the

Catholic Church, the predominant religious organization in Id order to Isolate It further from outside influences and to destroy Itymbol of Hungarian nationalism. While generally not using the police-terror tactics common in the Rakosl era, the regimebas used financial pressure and police harassment to restrict severely the activities of the local parish priests and to force members of the church's hierarchy to conform. The status ofMlndszenty, long separated from church affairs anda convicted criminal by the regime, does not at thefigure in the controversy.

Onctober the Hungarian Presidential Council accepted the "resignation" of Bishop Mlhaly Endrey, administrator of the Esztergom Archdiocese, ln Hungary. Bishop Endrey, who as special apostolichas been the Vatican'sto the Hungarian church, had been empowered to administer the archdiocesethe incapacity of Cardinal Mlndszenty, its actual head.

HUNGARIAN REGIME CLAMPS DOWN ON CATHOLIC CHURCH

In addition to forcingnembers of the clergy from office, there arethat the regime, by taking advantage of its right under0 church-state agreement to rule on appointments of church officials, will try to fillchurch posts with priests loyal to the state. Apparently the church has now been forced to give its permission for three excommunicated "peace priests" to run for Parliament in the current elections.

The regime is using the church's dependence on state financial support as anlever to applyeries of meetings ln September with the churchln which the latterwas forced to endorsepolicies, the government in September for the second timecheduled reduction In its annual subsidy to the church. This quid pro quo was used by the state to foster the impression that it isenevolent policy toward the church.

At the time of0 church-state agreement, it was envisioned that the reduction Id church funds would be at least partially met by donations from the Hungarian faithful. This has not occurred, however, not only because Hungarian Catholics have few funds to provide, but possibly also because they are under the Impression that state support is adequate.

Although the bulk of the state subsidy goes to pay priests' salaries, this is to maintain even a subsistence level. To make his situation worse, the local priest is expected to make

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personal contributions tofund for theOf the church.

USSR ACTS TO INTEGRATE BLOC TELECOMMUNICATIONS

Soviet blocon telecommunications held sincethis month inthe ussrv3 desire to overcome the bloc's lacknifiedsystem. ew body known as the Organization forAmong the Socialistin the Fields of Post and Communications (OSS) has been formed. This new group isassociated with, but probablyart of, the Council for Mutual Economic Assistanceince itChina, North Korea, and North Vietnam as full members.

pecific planby the new organization at the8 CEMAin Moscow, all Sino-Soviet bloc countries are to make their telecommunications networks partly automaticnd fully so Allcountries were required to make available Immediately the required funds for this and to report equirements forand their production capacity for such equipment to the proper committee of CEMA by They are totelegraphic trafficcountries and establish relay stations for an eastern television network to

The priority of thismay be indicated by the

fact that the Hungarianplan8 was altered to provide funds for theof the country's It therefore that each country isto finance Its share of the program without aid from the USSR.

A major build-up oftelecommunicationswithin and betweenbloc countries willSoviet control ln these areas markedly. The program willeusthen bloctary potential,J

The ultimate status of OSS is not yet clear. East Germany, Communist China, and North Vietnam have all pressed for its establishmentlno-Soviet bloc counterpart of the Universal Postal Union (UPU) and the InternationalUnionspecialized agencies of the Economic and Social Council of thethey havebeen denied membership in those two organizations. Other bloc countries are opposed, however, for fear oftheir standing ln the UPU and ITU.f

(Preparer, oy uhk;

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SOVIET ECONOMIC DELEGATION TO VISIT THE SUDAN

USSR'S economicscheduled to arrive in Khartoum In mid-Novembervlll find the political and economic climatemore favorable toSudanese acceptance of aid than in the past. Both the country's shaky economy and pressure from groups opposing the government's reliance on Western economic aid may force Prime Minister Khalll to accept Soviet assistance. Sovietof Naelr's Aswan High Dam scheme, however, may prove toindrance to an agreement, for the dispute over the waters of the Nile unites all groups in the Sudan, even those which favor the UAR, against what tbey believe to be excessive Egyptian demands.

Despite the West's recent substantial economictarget of severe criticism from theoutlook for the cotton-based Sudaneseis poor. erious crop failureteady drop in prices followedotton-marketing disaster. The country will probably enter the new marketing season, vhlchin earlyarryover ofales. This is even larger thanarry-over and approximately equal to thecrop for next year. The cotton crop promises to equalecordales, but prospects fornext year are not bright.

A vorld oversupply ofand the Sudan's relatively inflexible prices suggest thatSudan's chiefwill succeed in underselling Sudanese cotton in world trade. Although foreign aid will tend to ease the economicolicy assuring sale of the cotton crop each year is necessary. Under these conditions, the Sudan may be strongly tempted to market some of its cotton through barter arrangements with bloc countries.

The Soviet delegationwill offsr large-scalefor the Sudan'a economic development program.In addition

to machinery, materials, and technical assistance, Moscow may offer some foreign exchange in return for Sudanese cotton.

Khalll may feel he is forced to choose either to depart from his pro-Western position or face an increased threat to the stability of his government. The National Unionist party will make a majorto defeat the government during the session of scheduled to begin onovemberi the party is apparently receiving the of labor groups and the leftist Concurred in by ukkj

BRITAIN'S PROBLEMS IN ADEN

rioting in Aden Colony highlights theLondon faces in its efforts to retain somein the southeastern Arabian

peninsula by granting timely concessions andew propaganda effort against UAR influence. British crushed thectober -

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November rioting by forceful action, including deportations of agitating Yemeni laborers, but any further trouble may weaken Britain's determination and ability to proceed with plans for developing greater local autonomy.

Those rulers of theAden Protectoratewho agreed in July under British prompting tonow are meeting with the British in Aden to discuss the temporary capital site, the federal constitution,efense treaty with the UK, the budget, and the formationefense force. Britain, hoping tothe federationas obtained the promised membership of thenext Sultan of Lahej, whose large territory adjoins Aden Colony and whose exiledrefused to Join.

Aden Government officials hope that constitutionalin the colony will permit linking it to the federation in about four years,with the city of Aden as the future capital.

SAUDI ARABIA

i.i. rj

iJLTAKATE OF MUSCAT AN I! (WAH

For the present, Londonthe planned federationore convenient framework for resisting subversion andounterweight to the attractions of the UAR and Yemen. Ithopes to Include the Eastern Aden Protectorate in the federation. The British intend to grant the federation self-determination within ten years, perhaps sooner.

secret'

Meanwhile, the Aden Trades Union Congress has said It will join the nationalistcalled for by9 Legislative Council Thisapparently quashes the

government's hopes ofthe labor movementounterbalance to the forces of more militant f

INDIAN COMMUNIST PARTY DEVELOPMENTS

Infightingthose who advocate acourse and those who favor more extreme tactics,roblem among Indian Communist leaders, has intensified during the past two months as theparty's position in Kerala State has grown more difficult.

The Communist government in Kerala is becoming somethingiability for the party at the national level, as well as for Communists in other key states,esult of recent strikes and civil disturbances in the state which have roused national protests and damaged Communist prestige.

These developments appear to haveplit in the state Communist leadership, and more recently in the national executive, over the question of whether the party's interests would best be served If the Kerala government resigned at this time, claiming persecution by Nehru's national government. The moderate faction, led by Kerala Chief Minister Nambood-iripad and national secretary Ajoy Ghosbf-

that such TOTXcnr-nCTw-woxria piny into the hands of theand should be deferredear or so before2 elections.

Tho extremist group, led by the secretary of the state party and autlmoderate national leaders, has argued strongly that if the party Is unable to implement its full program in Kerala, It must leave office immediately so as to avoidprestige throughout the country. Communists ln West Bengal and Andhra states, where the party's prospects arepromising, are supporting the position of the extremists who now appear to be gaining strength within the party.

onsequence of the situation in Kerala, theCommunist strategy in India has come into question in the top echelons of tho party. of the peaceful approach to power through parliamentary means, which was initiated with

great fanfare only last April, now are demanding that this line be abandoned in favor of more forceful methods in opposing the ruling Congress party. While growing pressure on themay eventually force the party toomewhat harder line. Communists in India are unlikely to depart radically from the peaceful approach laid down by Khrushchev ath party congress This approach resulted ln doubling of the party membership7 toumber of recent elections.T

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POLITICAL AGITATION IN CEYLON

parties inare again openly attacking Prime Minister Bandaranaike's government, following theof press censorship and the removal of bans on political party activities. These attacks reflect widespreadwith emergency rale, which was extended onctober for the sixth month, and growingover the government's failure to cope with Ceylon's economic problems.

The economic situation is the dominant antlgovernment theme of the two principalrelatively moderate United NationalP) and the Trotskylte Lanka Sama Samaj party (LSSP). and congestion at Colombo port have been relieved only slightly sinceof the port last August, and the government has not yet backed its promises of economic progress with realisticplane. Both the UNP and the LSSP have held well-attended public meetings at which their leaders have stressed risingtatic wage levels, tbe probability of increased taxes, and governmental ineffectiveness in handling the situation. The two parties reportedly intend too-confidence vote against the government when Parliament reconvenes in late November. ufficientto defeatotion, but antlgovernment agitation probably will increase as the parliamentary session approaches.

The UNP is more active than at any time since its election defeat It reportedly Intends to open additional party branches and continue its series of public meetings. The degree of support which the party may have gainedesult of the government's decliningis uncertain, but UNPprobably will continue their efforts to attractdefectors from the ranks of government supporters.

The LSSP, which controls tho bulk of Ceylon's strategic urban labor elements, may be ths government's most serious political rival at present. pecial conferencectober, the party discussedeneral strike in early December. Rumors of such plans have circulated forear, but party. Prrera has consistently opposed strike action designed tothe government until the LSSP is sufficiently popular to gain political power throughelections.

Perera'm nonrevolutlonary approach apparently still governs party policy,otiondirect action tothe government reportedly was defeated at the meetingote. However, the fact that LSSP-led agitation has previously won labor benefits could create popular support for some LSSP strikes based on eco-nomlc demands.P

LAOTIAN GOVERNMENT'S POSITION PRECARIOUS

Prime Minister Phoui Sananikone is questioning the viability of his government, especially in view of the bitter resistance of elements within

his ownRally of the Lao Peoplethe reforms which he is championing. Phoui describes himself aswo-fronttbeNeo Lao Hak Zat (NLHZ) and against his own

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CURRENT INTELLIGENCE WEEKLY8

Phoul has expressed doubts that the government will be able to reverse the HLHZ trend prior tohen general elections are scheduled. He feels that time is working against theregime and tbat the only real alternative may be the radical suppression of the NLHZ.

Phoul attributes theof the RLP fully to support him to the "unreconstructed" attitude of many RLP deputies and the ambitions of formerministers. He Is alao crltlcal of young reformistof his cabinet forantagonizing RLP His remarks suggest that he feels the anomalies of his position stem from his close identification with theCommittee for the Defense of National Interests ovement which many members of the RLP probably regardhreat to their privileged posl-tIons.

Foreign Minister Khamphan Panya,DNI member, states that the RLP members of theare gradually isolating the four CDNI ministers, and he has expressed serious concern as to whether the government will be able to withstandfrom disgruntled elements within the RLP. He observed that most RLP deputies are in severe financial straitsesult of expenditures during the May electoral campaign and resent the government's reforms, which ended the import license bonanza. The deputiescan be expected to take out their resentment on the Phoul government.

Developments in tbeAssembly onctoberthe precariousness of Phoul's position. Two RLPJoined with the opposition to bringote ofoeven-day extension of the assembly. Phoul interpreted this last-minute extensioneliberate challenge to hisand forced the cloture of the assembly as scheduled.

Jth* assembly may be called into extraordinary session to allow dissatisfied RLP deputies an opportunity to Join with the opposition and topple the gov-ernment. I '

OPPOSITION TO SARIT DEVELOPING IN THAI HILITARY GROUP

Marshal Sarlt seems to be faltering in his efforts to Thailand's political Certain key leaders of his military group arerestive because of his tendency to retain the right_to_ make all decisions.

Such key factional leaders as General Thanom, the former premier; General Prapat, the former interior minister; and

CURRENT INTELLIGENCE MEEKLY8

Krlt Srlwara, theof the strategic first division in Bangkok, are no longer among Sarlt'8 close Since his power isdependent on theirSarlt can scarcely afford to alienate them. '

Thanom is critical of Sarit's delay inrovisional cabinet. Sarlt may alsothe Prapat faction if he carries out his plan to Include only three military figures in the cabinet.

The group's variousmay still be more widely separated by their disparate aims and mutual distrust than united in their dissatisfaction with Sarit. However, if Sarlt continues to isolate from then and delays too long in forming awhich will accommodate their interests, he will himself to the danger that these factions willtheir differences long nough io_ojist him.l

INDONESIAN CAMPAIGN AGAINST CHINESE NATIONALISTS

Indonesian Government is stepping up Its campaign agalnat pro-Chinese Nationalist elements. Begun last April, the campaign apparently wasby Djakarta'sthat Taiwan was materially assisting the provincial rebels, particularly those In North Celebes.

Underlying the campaign, however, are long-standingagainst the Chinese for their domination of retail trade and the government's needcapegoat for its military and economic difficulties. These broader considerations suggest that ultimately the only Chinese spared will be those who have successfully "identified" themselves with Indonesia or have registered as Chines*citizens.

The campaign started with the suspension of all Chinese-language newspapers. Six weeks later, however, many of tbe pro-Pelping papers were permitted to resume publication. actions since then have Included the arrest of numerous Kuomlntang (KMT) leaders and businessmen, ths banningT activities, and tbe denial of combination exit and re-entry visas to holders of "stateless" (Chinese Nationalist) passports. Last month Djakarta announced its decision to place underGovernment control all enterprises, Industries, and educational facilities wholly or partly owned by Overseas Chinese who are" citizensountry not having diplomatic relations with Djakarta recognizes Pelping.

CURRENT INTELLIGENCE WEEKLY8

of the sizeChinese community invaryo

approximately ia percent of the Indonesian Chinese are actively pro-KMT,ercent are actively pro-Communist, andercent "Identify" themselves with the mainland regime. The remainingoercent are either uncommitted or, as Indonesian citizens, haveIdentified with Indonesia.

The economic effect of the government's seizure ofenterprises will be fairly severe, since the Chinese, from the standpoint of business acumen and investment, have been second only to the Dutch in Indonesia, and their absence willubstantial vacuum. The cultural and politicalof the take-over of most Chinesemovement which has been under way since

first appeared to be constructive, from theof Indonesian nationalism. With the anti-KMT theme given the movement in recent months, however, the remaining Chinese schools will be under theof pro-Peiping elements.

The Indonesian drive has produced considerable anger and frustration in Taipei, and the Legislative Yuan has demanded that the government appeal to the United Nations and tonations for sanctions against Djakarta. The Foreign Ministry doubts that an approach through the UN would be productive, and other means of bringingto bear are being explored. The ministry is hopeful that by demonstrating someof "sympathy" for theeasure of relief for the Chinese in Indonesia

can be achieved. This, how-

ever, is doubtful. I

PEIPING MAINTAINS HOSTILITY TOWARD TOKYO

China shows no sign of softening its harsh conditions for resuming trade or cultural relations with Japan.

The Chinese are particu-TarTSr^incensed over Kishl's 9

October

Tin

"which Kishl referred to commu-nist China as an "aggressor nation."

The Chinese Communist priceesumption ofis Japanese compliance

with six conditions spelled out

The"

Ohinese said rue msni govern-ment must: hange its "hostile" attitude;top promoting the "two Chinas" concept;ease interfering with efforts toward restoring normal relations;pologize for the incident in Nagasaki last spring lnommunist flag was torn down;tatement of its readiness to restore relations; andelegation to Peiping todifferences. PrimeKishl has Insisted that differences between the two countries were only the result of "groundless" distrust.

Peiping's latest move ln its cold war with Tokyo was the

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last week of two Japanese fishermen for allegedly spying, for the Japanese Coast Guard, on Chinese Communist coastal installations. Theare expected to use the prisoners to bargain for anin relations. 's releasether fishermen held since May was timed to appear as the result of intercession by Japanese leftists in Pelping In early October.

The Chinese Communistsintended that the release of the men would agftin remind Japanese fishing interests of China's continuing refusal to permit fishing within the Communists' "restricted" area. Last June Pelping refused to renew the annual SIno-Japanese fishing agreement, hoping that Japanese interests would put increased pressure on the Kishl government for an understanding which would permit unhampered fishing in Communist-claimed

area*. Pelping apparently still believes pressure by commercial interests in Japan willbringore friendly attitude on Tokyo's part.

However, the impasse with Communist China has ceased,at least, toajor issue in Japan, for otherare receiving almost all thei public's attention. Pelping'? continued intransigence isby most Japanese,many businessmen, aa unreasonable and as offering little prospect for an early settlement.

hange in Tokyo's policy, the Chinese Communists are expected to stress their desire for more trade with "sympathetic" countries while rejecting offers of intercss-slon by third parties^

BRAZIL MAY EXPAND TRADE WITH SOVIET BLOC

approval ofctober of its first postwar barter deal with themall quantity ofcrude oil in exchange for cocoa, is one of severalthat the government may respond favorably to more of the bloc's rscsnt trade and barter proposals. Public debate ondiplomatic relations with the USSR is likely to be revived by publication In Brazil onctoberew statement by Soviet Premier Khrushchevsuch ties. Shortly afterwards, Vice President Goulart was publicly invited to visit the USSR.

Most of the bloc's recent proposals either have beon

focused on Brazil's shortage of dollar goods, particularly sheet steel, oil, and oil-drilling

equipment, or have been blanket invitations to procure,arter basis, virtually any type of equipment needed for theeconomic development program.

Its

relucta!nce to become dependent on the bloc for importantitems is illustrated by its|six-month delay in accepting the Soviet oil offer finallylast week.

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the same time, however, tbe government decided into lift restrictions on the use by private traders of certain bloc currencies and has recently signed bankingwith East Germany and Rumania. It already has trade agreements with Poland,and Hungary. Finance Minister Lucas Lopes said in August that Brazil must seek new markets "in new areas, Including the areas of Easternf the country is to service its mounting foreign debt and alsoesirable rate of economic development.

Brazilian trade with the Sovietdeclined last year from its postwar highnlikely to increase next year. In

addition to the Soviet worth aboutway, Brazil last Maythree-year barterPoland callingcargo vessels beginning f

oncurred in by UKKJ

THE POSTELECTION SITUATION IN CUBA

easy victory of Andres Rivero Aguero, Presidenthand-picked successor, and other progovernment candidates inovember generalhas not improvedfor ending Cuba's two-year-old civil war. Rivero is unacceptable to the Fidel Castro rebel movement.

Rivero, who campaignedlatform of continuingpolicies, wonight vote. He commands no political following of his own and has reached his present position through devoted service to After his Inauguration onebruary, he will remain dependent on the government political machine and oncontinued domination of the military. awyer and former journalist,yoar-old president-elect has held several

high government and diplomatic posts. His last position was prime minister from7 until his nomination to the presidency in

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CURRENT INTELLIGENCE WEEKLY8

FRENCH ECONOMIC PROBLEMS

economic andsituationise of0 In its gold and dollar reserves since May which resulted mainly from the special Internal gold loan of last Trade and payments balances continue to be adverse, andof the European Payments Unionevaluation of the franc may be necessary soon. Tho government's financialis complicated by theof renewed wage demands and the likelihood that De Gaulle's socio-economicfor Algeria will be at least as costly as military

The beneficial effects of the7 devaluationrancs to the dollar were wiped outise inexpenditures, and Finance Minister Pinay admittedhat devaluation would

probably be attempted again if Interna? stabilization were achieved. in the EPU board's view, it will be politically feasible if9 budget, which is expected to be announced early ln December,eficit close to theillion limit. The board cites recent evidence ofinternal demand, and points out that France mustthe eventuality of facing up to Free Trade Areaand the possibilityritish move to convertibility next year which would threaten France's position inexport markets.

Successful execution of the EPU board's suggestion would depend, however, on maintaining price stability. In view of growing labor restiveness. It is likely the government will not long be able to continue postponing consideration of

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CURRENT INTELLIGENCE WEEKLY8

demands which could shake the delicate price balance.

De Gaulle may be reluctant to adopt more stringentmeasures until he halts the hostilities in Algeria, where his economic proposals Imply at least asinancial drain as pacification coats have imposed on France. He iscounting on favorable psychological repercussionsease-fire to create an atmosphere of confidence in

France's economic and financial potential that willlow of capital to facilitate his ambitious developmentfor Algeria. It ispartly with this in mind that the government isto develop Parisajor capital market center. De Gaulle may envisagethe inflationary effect of his Algerian program by channeling into Algeria both French capital and funds from other Common Market countries.f

REE TRADE

The OEEC'sCommittee (IGC)uropean Free Trade Area (FTA) plans further sessions onndovember In an effort to break the impasse between France's demand for protecting its industries and Britain's insistence on free access to the Continental market without prejudicing its world trading Interests, The course of events atctober meetings, however. suggests that theations involved are unlikely to reach agreement until some high-level deal is worked out between London and Paris.

Britain attaches highto reaching some understandinguropean Free Trade Area before the operations of the six-nation European Common Market (EEC) have had time to become The EEC Is scheduled to make Its first Internal tariff cuts

AREA NEGOTIATIONS

France, concerned about protecting its domesticand established markets abroad, has been the principal obstacle to establishing an FTA. Atctober meeting it expressed alarm that it might lose Important markets in FTA countries if tbey remained free to lower tariffs against non-European countries, as envisaged under the proposed FTA.

Britain, with its global trading interests, considers such flexible tariffaa essential. France's EEC partners, West Germany and the Benelux countries,ompromise on this issue by resorting to prior consultationode of good conduct in negotiating tariff reductions witb outside countries. Their governments were apparentlyto bring pressure on France, however, because of its delicate political situation and acute economic problems.

CURRENT INTELLIGENCE WEEKLY8

seems increasinglythat therospective FTA members will be unable to reach agreement without some high-level Anglo-French deal ln which French concessions on the FTA would be set against British concessions on other matters.

such as French interests ln Africa or even NATO. Foreign Minister Couve de Murville's visit to Londonovember may prove important for laying the groundwork foreal

II

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8

PARTY XXX PATTERNS END PERSPECTIVES

ITALIAN COMMUNIST PARTY:

Italy's Communist partyhe largest Oatside the Sino-Soviet bloc, continues to maintain its appeal to votersecline in actual party.membership and friction: among: leaders that may lead to an organizational shake-uprospective party congress in These handicaps are offset by the Communists' persistent appeal to thenoty challenged by other partiesby their continuingof the labor field. Their future in Italy dependsarge extent on thepath taken by the Nennl Socialists.

The party's voting strength seems to be little affected by international developments. On the one hand, its close ties with Moscow and its support of Soviet foreign policy havenot hurt it On the other band, it has not succeeded in itsto stir up publicover such cold-war issues as the American contribution to strengthening Italy's NATOcapabilities and thelandings in Lebanon; nor is the PCI's continuingcampaign against NATO missile bases in Italy likely to enhance the party's popular appeal.

In recent local elections inommunes, the PCImanaged to hold its own, affirming the results of the8 national elections, when itotes under relatively unfavorable conditions andf the total vote. At that time it lost three ofhamber seats previously held, but only because thenational electoral law eliminated certain advantages formerly enjoyed by big parties.

STATUS AND PROSPECTS

While tbe party lost ground in the prosperous northernareas In the Mayit gained among 'the agricultural workers of the south. The PCI, which atsuffers from the fact that most Italians are better off economically than ever, could in the event of an economicprobably hope to recoup its northern losses and broaden its gains in the south.

Communist Party Handicaps

Although the PCI remains the best organized of allparties, it has suffered considerably from apathy and dissension among its rank and file and factionalism in the leadership. Actual partynow estimated, declined in67esult of the restlessness generated by theh party congress and the Hungarian revolt. This restlessness has been further stimulated by recent reports by delegations of Italianon living conditions in the USSR. Further depletion ofranks may be in prospecturge of cadres, which the Italian press inequel toakes place. "Devlationlsm"ajor factor in the party's decision toargeof former senators and deputies from the election lists before the May elections.

Rumors that the aging and ailing party secretary general. Palmiro Togliatti. vlll shortly be replaced are again prevalent.

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68

Vice Secretary General Luigi Longo, who had visited Moscow early in August,

How much of this fall-off can be attributed to Italian Government regulatory action is unclear. The partyhas not suffered much from the government's measures of last July banning Communist public rallies and confiscating leaflets.

iCould be expected

to follow the Moscow line more slavishly, which would probably aggravate dissension within the party and cause further defections among intellectuals,

During the past two years, PCI Income derived from East-West trading activities of party-controlledommission basis has fallen off markedly.

Communist Advantages

The PCI's great advantage seems to be its continuing ability to present itself to the Italian public as the chief party of protest against the failure of successiveto remedy basic Italian economic defects. Thedisparity between the north and the south, chronicand the extremes of wealth and poverty resulting from an inequitable tax system continue to give the partywhich bring it the support of protest voters as well as of the majority of workers. Many not sympathetic to Communism regard the PCI as the onlyopponent ofcorruption, stateto thendinfluence in state affairs,

CURRENT INTELLIGENCE WEEKLY8

failuretrong Socialist party to emergeemocratic alternative to the Communist partyreat degree to the ability of the PCI toits strength ln recent years. The Nennl Socialist partyincewhen It voted ln Parliament forbeen showing an Increasing tendency toItself from its former Communist allies, but so far has been unwilling to make an outright break. The philo-Communlst wing still controls the PSI machinery, and reunification with Giuseppe Saragat's Democratic Socialistsong way off.

The Communists are also favored by their predominantln organised labor. The Communist-controlled General Labor Confederation (CGIL)the most powerful union in Italyropover the past six years.8 the CGILagain to win shop steward elections. In the elections in8 ln the big FIATcomplex, the CGIL3 percent of the1 percent the year before. Inuch elections held ln the province of Genoa last spring and summer, the CGIL2 percent of the votes, comparedhe previous year.

It is in the labor field that the Communists havetheir strongest hold on the Nennl Socialists, who are afraid to quit the CGIL lest they be accused of splitting the working class. The failure of the Christian Democratic -oriented Confederation of Free Trade Unions and the Democratic Socialist-dominated Italian Labor Union to merge has also helped the Communistsominant position. The recent formation ln the automobile Industrynion heavily financed by management further divides the free union forces.

Prospects

Its past record suggests that the Internalit is nowposes nodanger for the PCI. Nor is it endangered by the repressive measures undertaken by the government thus far. Even if Premier Fanfani were to move against the party by proposing an electoral law similar to thatadopted Id France, it is likely thatroposal for single-memberwould arouse as strong opposition from the minor parties as from the PCI.

Substantial progress by the Fanfani government inits bold election platform of socio-economichowever, would seriously undercut Communist strength among the workers. Because of probable opposition to these proposals by right-wingboth inside and outsidehristian Democratic party, the government would need the support of most of theenni Socialist deputies to getrogram through Parliament,

TOP 3LCRLT

TOP SEGREJ

CURRENT INTELLIGENCE WEEKLY8

chances for suchdepend largely on theof the PSIscheduled for mid-January. Nennl has been trying to wrsst control of his party'sfrom the pro-Communist wing. He was defaatsd onctober in the central oommittssote for his policy, which in affect called for greater from Communistbut may succeed in rallying sufficient support from various party federations

during the next two months to enable him to achieve hisat the congress.

Communist concern over pos slble PSI cooperation with ths government on socio-economic reform is evident in Togllatti'i call to tha psi onctober to cast aside all doubtscollaboration andto the unlty-of-action pact between the two parties.

SITUATION IN THE PHILIPPINES

The political and economic drift during theonthsGarcia has been President of the Philippines hasthe country's earlier progress toward internal Popularwith Garcia is widespread, and expressions ofover present trends are mounting in influentialpress, and business circles.

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Failings of Garc La Leadership

Despite bold Initialthe Garciahas consistently failed to take action to meet the country's economic Rice production is still inadequate, and the rate of economic growth has beenoff, except in thesector, where many new enterprises are of dubiousvalue. The rapidof foreign exchangewhich precededlection has halted, but Import curbs have beenand reserves have not been built up.

Banking on promises of American loans, ths government has postponed basic fiscal and budgetary decisions needed to fight inflationary pressure. Provincial officials haveofeglect of worsening rural conditions, and take it for granted that he has little Interest in tbeand eoonoalc reformsunder the lata President Magsaysay.

Garcia was unable tocongressional action on much of his economic program, and there is little Indication he will do better in theJanuary ssssion. In his own Nacionalista party, thererowing anti-Garciawhich includes party and Senate Prosidont Rodriguez and Senate Finance CommitteePuyat. Many NacIonslistas have echoed the press andcriticism of the rapidof corruptiontbe government, and they are further antagonized by the President's monopoly of Garcia's much-publicized investigations ofcorruption ars now widely regarded as window dressing and as an excuse to put his own

henchmen into ths traditionally favorable posts for government graft,

A constructive opposition movement has been hampered by disunity among the opposition parties. The Liberal party has continued to suffer froa its association with the corrupt Quirimo administration, and the inability of Macapagal, as the nation's vice president, to take swift command of the party has brought forth rivals, such as Senator Padllla, for Liberal party control. Soroposed merger with the new Progressive party is stalled over suitable terms.

Vargas' Ambitions

In the present confusion, many prominent political and military figures haveeyed Defense Secretary Vargas, now In tbe position from which Magsaysay rose to the presidency,ossible answer. Vargas was associated with the late president In the military suppression of the Communist-led Huk rebellion and as armed forces chief of staff during Vargas'political ambitions are suggested by bis eagernessosition in the Garciaafter retiringareer officer. Someparty members may regard Vargas as the key to eventual opposition unity. Be has also been close to ex-Senator Laurel, the chief loser in Garcia'sto control theparty. Laurel recently added to the speculation over Vargas by praising him as the "last remaining hope of the country for better government."

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brought Into his administration many close military associates, and military officers continue to hold prominent positions in the Garcia regime.

Role of Military

Although the Philippine military has never been entirely divorced from conduct of thepolitical affairs, the armed forces haveenerally nonpolitical role. In early postwar years, theconstabulary was th*armed force, and political corruption affecting both it and the armyajor factor in the government's failure tothe Huk rebels. The armed forces were more feared than the Iluka and were allegedly used to Intimidate voters in the notoriouslylections.

In military reorganizations carried out by

the defense

0M Army was expanded, re-equipped, and trainedelatively disciplined andcombat force. employed the army not onlyilitary campaign against the Huks, but in psychological warfare against Communism, in resettlement and economicof surrenderedand in rural 1 armed forces units have maintained order and free access to polls in all Philippine elections. When Magsaysay became president, he

Conditions in thehave not reached astage, but theren among top

(offi-

ciais that present trends could lead to Increased vulnerability to Communist Influence. Unless the Garcia administration takes steps to reverse the continued slowavorable climate for militarymay develop. |

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COMMUNIST REGIMES IN EASTERN EUROPE REGAINING STABILITY

Current Situation

The reglmee of Easternalthough exhibitingdiversity in theirpolicies, haveubstantial degree ofand self-confidence since the uprisings In Poland andln The ability to restore control can bein large part to Moscow's willingness to permit thelimited freedom of action and its recognitione-imposition of extreme Stalinist measures would be Inefficient, if not dangerous. Thsleaders still recognize, however, that their enhanced authority derives from their loyalty to Moscow.

With the re-establishment of bloc unity and the evolutionew Soviet policy toward Eastern Europe, the satellite leaders havelear understanding of what they can and cannot do. They haveto avoid at theirthose internal policies which would serve to undermine their authority. They can, however, employ repressivewhere necessary. there have been no wholesale purges such as those following the crisis whichTito's ouster from the bloc Hundreds ofalong wltb Imre Nagy have nonetheless been executed for their role ln the revolt.

The handling of dissident intellectual forces In the satellites has ranged from trial and imprisonment toat placating them. Vital problems, Buch as absenteeism, alcoholism, pilferage, and low productivity, are dealt with by varying degrees of coercion.

The Soviet leaders appear to have developed considerably more confidence in the political orientation and behavior of the

satellite regimes. For example, Moscow has supported Janos Kadar despite his equivocal attitude toward the Yugoslavs

WaTTer TJIbricht has irwu muxw to get rid of dissident elements; at thetime, he has adopted as hisumber of the proposals which his enemies advocated to reverse or modify his harsh internal policy. Polish leader Wladyslawthe first time

PILFCRAGF

*Tha Uar?f It man*

since his return to power in Octoberled afriendship delegation to Moscow.

A further indication of Moscow's increased confidence in the Eastern European is its reporteddecision to withdraw Soviet military advisers from tbe area,.

Briefly, Khrushchev'sin6 and early

ere to re-establish Soviet hegemony over the satellites, eliminate or neutralize the "revisionist" threat to Moscow's Ideological primacy, and provide each of the satellitewhatever degree ofautonomy accorded with the so-called "basic laws."

Strengthened Party Control

Intrasatellite stability required first ofecon-solldation of the blochole after the debacle of the Hungarian revolution. Thistrengthening of party control not only In Eastern Europe, but within the USSR itself. industrialincreased the authority

ABSENTEEISM

and prestige of the party and resultedispersal of the highly centralized industrial bureaucracy. In Easternpost-Stalinmade any restoration of party control both moreand morefirst secretaries neededleeway if they were to purge their organizations of dissident or potentially dissident.

There hasradual return to some of the domestic policies associated with the period prior to Stalin's death. This is particularly true In

the "orthodoxBulgaria, Czechoslovakia, and Rumania. esseretrogression can be seen in Hungary and East Germany. had never allowed the "thaw" toerious

Poland reflects atrend in certain facets of its Internal policies, although it can hardly be considered an "orthodox satellite" in terms of bloc standards. Warsawmore conformist in foreign and intrabloc policies than in Internal administration, much oftheat variance with the rest of the satellites.

While it is unlikely that Moscow everotalof the more extreme methods of Stalinist control in Eastern Europe, Khrushchev, in his approach to the problem of satellite stability, recognized that the encouragement oftrends and of "separate roads to socialism"as premature. For one thing, Moscow overestimated both the loyalty of the party rank and file and the competence of the satellite party leaders. The Kremlin is now making it clear to them that "localism oris to be condoned only within severely restricted limits and is thereby removing whatever support its earlier policies may have seemed to give to "national Communist" elements.

Attitude of Satellite Leaders

For their part, theof whom were hesitant to strike out on their own course prior to the crises inundoubtedlythe increased authority which Khrushchev has given them. No longer need they concern themselves with the dilemma which ill-conceived attempts at restoring "party democracy" or encouraging local autonomy in economic matters posedotalitarian system.

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the possibleof Gomulka, the onlynational leader among them, the satellite leaders today share oneconservatism. their Polish counterpart, they take little cognizance of nationalismorce to be reckoned with in the formulation of Internal policies. Most, in fact, owe their presentto Stalin's past favor and owe their early ideological training to Soviet party schools; they thus are predisposed to abandon whatever innovations followed Stalin's death.

No less than their leaders, the lower party careeristsested interest. For them any threat to the regimehreat to themselves; in their eyes the most dangerousof the short-lived "thaw" was the thinly disguisedor ridicule to which they were subjected. The Hungarian revolution taught them that the

foundation of their power was at stake.

Questions of Dogma

Some of the more obvious differences ln the Internal policies of the variousundoubtedly stem from their varying degrees oftoward socialism" Such considerations alsoart ln the formulation of Soviet policy toward the satellites. This is evidenced by the fact that Moscow'sJournal Kommunist, in its issue ofraded the countries according to their degree of agricultural collectivization.

Bulgaria and Czechoslovakia were said to be in the vanguard, Rumania, Kast Germany, andnext, and Hungary andwere in "special Despite variations ln "buildingowever, all the satellites havethe party's role of

infallible "guide." Tlie renewed emphasis on the dogma of party supremacy may have arisen, in part at least, out of fear that "Titolst" influences may exist in the satellite parties.

Economic-Political Pressures

The reassert ion of party Infallibility has affectedbetween several of the regimes, as well as the policies toward workers, intelligentsia, students, and the professional classes. It hase-imposition of labor controls and an Increase in partyof trade unions and other workers' organs lnHungary, Poland, and The relmpositlon of firm party control over labor and the staging of campaigns against the theft orof "socialistowever, are only partroader effort to ensurediscipline ln all sectors.

In Rumania, the regime has exacted the death penalty for economic crimes and has written laws providing for theof the property of anyone accused of such offenses. In Czechoslovakia, the workers are hold financiallyfor underfulflllment of their production norms or for breakdown of machinery through negligence. Similar measures undertaken in Bulgaria have been more severe than those inbut both regimes haveto coercion againstabuse."

The Polish Government has beenigorous butunsuccessful campaign against thievery, embezzlement, and alcoholism. As is the case elsewhere, the average Polethe property of the state or collective enterprise as something less than sacred and has little, If any, compunction about appropriating it for his own use,

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sculptors, artists,6 retreat to ideological orthodoxy has meant eitherto the party's dictates or Inactivity or worse. The campaign against Intellectuals, evident in all of thehas been particularly severe ln Bulgaria, Poland, and Rumania,

Agricultural Policies

During the past two years there have been more changes and greater differences inpolicies than at any othernone of the regimes bas expresslythe goal of complete To achieve this goal, the satellites have varied both their methods and rate of collectivization, but all,for Poland and Hungary, have formulated plans forincreased collectives 0 or sooner.

Bulgaria has claimed that all of its agricultural land will be In the "socialistby the end Is almost certain to reach its goal9 goal ofercent appears within reach, and East Germany's drive forercent8lready been achieved. Fulfillment of theercent for which the East Germans are striving0 is considerably less likely, however, and Rumania's goal ofercent for the same yearprobably not be realized.

Peasant resistance has been significant. There have been various instances of open, active resistance torequiring police and/or army intervention. Passive resistance was also highlighted67 by thewithdrawal of farmers from collectives in Poland andwhere political changes

permitted such open defiance of state directives.

A return to forcedln either of these two satellites depends on the resolution of opposing political views within their respective leaderships. The party andin Hungary are reported divided, with the dogmaticelementsolicy of forcing the peasants back into collectives by any means. To date, Janoswithore moderate course, only gradually Increasingon tbe peasants. In Poland, the Gomulka leadership Isto continue its voluntary collectivization policy at least throughpossibly as long as Gomulka remains lnof the party.

Prospects

It seems unlikely at this time that there will be aswing toward either greater repression or greater liberalism ln Eastern Europe. The satelliteswill continue toautonomy as long as they adhere to the "basic laws of socialist development" ash anniversarylast November ln Moscow and as interpreted by the Soviet leadership.

The power of ultimatehowever, rests withwhich claims for itself the greatest experience in thewhich entitles it to leadership of the world Communist movement. Moscow has achievedsuccess in restoring bloc unity, butong period of time the divergence of state interests and the demand for programs which accord with local conditions may tend to

dilute somewhat Moscow's con-

trol of Eastern Europe.|

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SURPRISE ATTACK IN SOVIET MILITARY DOCTRINE

he role ofattack has been givenweight in Sovietdoctrine, and recentby Soviet militaryrecognize its Importance in modern warfare. Perhaps to avoid the implication that the USSR could be defeated by aattack, and reflecting Soviet rejection ofreliance on surprise,Important factors, such as the economic base and geography, are still stressed.

Advocates of surprisefirst came Into their ownhen some Soviettheorists began treating surpriseignificant factor in modern warfare. arshal Rotmlstrov, writing in the army's authoritative dally Red Star, stated that "in cer-tainurprise assault using atomic andweapons may be one of the decisive conditions of success, not only In the initial periodar, but during Its entire course."

he debate over the Importance of surprise attack continued within themilitary hierarchy. General Popov, In his book Surprlso and Unexpectedness in "tlie Hi-story ofsurprise as The 'sole factor in determining the outcome of war and regarded iterivative of the constant factors andonly until ths enemy is able to organize resistance and liquidate Inequalities. eview of this book, otmlstrov arguedeak belligerent could use surprise to compensate for his weakness.

marshal Zbukov, lo anto commanders in the Group of Soviet Forces in Germany insserted that ths USSR would definitely be the one toar if it became

apparent the West was preparing to attack. His other remarks, relating to the role of theForces in Germany, suggest that, of the various courses of action open to the Soviet Union in the event of war, the USSR would choose to placeweight on the factor of surprise andourse midway between maximum prior reinforcement and initiating an attack with its forces in being.

Soviet forces presumably would, ime selectsd byand using only thoseavailable without sacrificing maximum surprise,oordinated assaultto secure the entire Continent of Europe.

Today,military writersto convey the impressionuccessful surprisecould be decisive,as well as tactically, but usually within the context of broader issues. An article in Soviet Aviation in8 warns that "to beith counteractions may in many cases mean defeat, not only in an operation, but alsotrategic scale."

This suggests that the USSR must not only be prepared to launch retaliatory blows, but also that It must strike first when it believes an enemyis imminentre-emptive striks). The author asserts that th* time factor must be considered both frost th* point of view of one's own intentions "and in rsspect torobablendicating that the warnings about prompt counteractionsto an imminent rather than to an actual enemy attack.

Geography is also treatedetermining factor, but In the sense that large land areas provide greater opportunities for dispersal of industry and

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against nuclearsocio-political factors are cited as Importantrolonged war of attrition.

* MiAlt*ry Herald articleolonel Bas in8 projected an image of World War IIIrolonged war, while conceding that contemporary weapons make surprise attack particularly effective. Major General Talensky in the8 issue of International Life, addressing himself 'to the "prevention of surprisergues that "even ln theera. the outcome of war will be decided by the totality of economic, social, political, and military factors, and not only by the factor of theof attack." Ho also reasons, however, that "there always will be enough symptoms to indicate the initiation of preparations of the armed forces of a state that intends tourprise attackeighbor," thereby suggesting the necessity of avoiding attack by attacking first.

The role of geography has always been an importantin Soviet military theory, but its role has been modified by the increasing importance assigned to surprise. 5 Rotmistrov argued that the idea of luring the enemy deep Into the country and destroying him there is absurd today and that the main advantage of the great territory of the USSR is to permit dispersal of itsits industries, and all productive forces.

In August, an article in Soviet Aviation which discussed "basic factors determining the course and outcome of war"that geographicof productive forces is especially important now that the destruction of these forces is possibleide scale. The principal Implication of the article was that the great size of the USSR gave it almost a unique opportunity among modern nations toizable portion of national territoryurprise enemy assault with modern weapons.

urther effort tothe invincibility of the "first country of social-Ism," the article, whilethat the "role ofhas especially grown in contemporary wars," In essence still gave the familiaroperating factors" as those determining the final.

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