SOVIET UNION EASTERN EUROPE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00865A001400220001-3
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 9
• Document Creation Date: December 15, 2016
• Document Release Date: August 12, 2004
• Sequence Number: 1
• Publication Date: July 25, 1975
• Content Type: NOTES

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op Secret
,~$UIFT HOUE
Soviet Union
Eastern Europe
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July 25, 1975
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Soviet Drought Could Have Political
Repercussions
Hungary: Cons
u
mer Price Increases. . . . .
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East German Ch
Good Start f
e
o
mical Industry Off to
r 1975 . . . . . . . . . . .
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Soviet Drought Could Have Political Repercussions
The severe drought in the USSR and the reduced
prospects for this year's crop will smudge the lead-
ership's economic record and could eventually--
though probably not immediately--end in a search for
a scapegoat. Dmitry Polyansky seems made to order
for that role. He has already suffered one serious
demotion from first deputy premier to minister of
agriculture in the aftermath of the disappointing
1972 harvest; but, because of his Politburo member-
ship, he is still the senior government official in
the field. His functional rival, Party Secretary
for Agriculture Kulakov, works well with General Sec-
retary Brezhnev and, all other things being equal,
Soviet scapegoats are usually found in the government
rather than in the party.
In the past Polyansky belonged to the old "Ukrai-
nian group," but in the shifting tides of regional and
generational politics, this "group" has lost its co-
hesiveness. Former Ukrainian party boss Shelest, for
example, found it to be of little help in 1972. Pol-
yansky has been careful in his public obeisance to
Brezhnev, but he has clearly been excluded from the
influential group of leaders who now constitute the
inner core of the Politburo. In the election campaign
this spring, he was the first of the Moscow-based full
members of the Politburo to speak, an indication of
his low place in the pecking order.
Polyansky has once again been sabotaged by the
vagaries of the USSR's climate in a delicate period
July 25, 1975
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in Kremlin politics. General Secretary Brezhnev
got though a troubled period last winter and is
entering the pre-Congress period in a relatively
strong personal position. He has no credible ri-
vals, although he has powerful--often critical--
allies among his contemporaries.
is
can be expected to be his
last
party congress.
He will want to strengthen
the
positions of his
clients and, to the extent
that
he can, lay the
groundwork for a succession that will continue his
work and preserve his place in Soviet history. He
is unlikely to see a role for Polyansky in this
scenario, although the latter might get some pro-
tection from other seniors concerned about limiting
Brezhnev's room for maneuver. In Polyansky's own
generation, contenders for succession are more
likely to be pleased than daunted if the field of
runners is slightly narrowed.
The timing of a move against Polyansky--assum-
ing one is made--is unclear, but foreign and domestic
considerations would seem to argue against any imme-
diate action. The Soviet Union would presumably pre-
fer to re-enter Western grain markets later this year
before revealing that its harvest problems were seri-
ous enough to cause the ouster of a Politburo member.
Moreover, the need for a scapegoat lies in the future,
when the harvest figures are in. To remove Polyansky
now would leave Kulakov vulnerable next fall as the
only remaining "responsible official" in the field
of agriculture.
July 25, 1975
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Hungary: Consumer Price Increases
The Hungarian leadership has been avoiding sub-
stantial consumer price increases for political rea-
sons, but now appears ready to move forward in this
sensitive area.
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re usa to raise prices this spring has been crit-
icized by some Hungarian economists. They claim
that Kadar was presented with solid statistical
evidence of the need for increases, but refused to
act for fear of removing the gloss from the party
Congress in March and the parliamentary elections
in June. Now the regime has apparently decided to
increase some prices in August and perhaps again in
January. The finance minister said the August price
hikes will include a 25-percent boost in energy costs
and a 10-15 percent rise in certain basic consumer
items.
Economic conditions in the West may well affect
the timing of the announcement of price increases.
Pricing boss Csikos-Nagy said the regime prefers to
make the announcement while inflation rates in the
West are high, thereby implicitly shifting responsi-
bility to the West. The regime obviously hopes that
such a tactic would help to keep it and the Soviets
from being faulted. The Soviet insistence on higher
prices for oil and other products imported by Hungary
have in fact hit the country hard.
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East German Chemical Industry
Off to Good Start for 1975
The East German chemical industry performed well
in the first half of 1975, overfulfilling its six-
month plan by 1.3 percent. Plans for the year call
for an increase of 8.9 percent over 1974. Impressive
production increases over the first half of 1974 are
reported for nitrogen fertilizer (16.8 percent),
potassium fertilizer (10.3 percent), polyvinyl chloride
(3.7 percent), synthetic fibers (8.4 percent), and syn-
thetic silk (8.9 percent).
Major additions to capacity during the first half
year included two Western-supplied plants. A second
ammonia plant went into operation at the Piesteritz
Nitrogen Works. The 1,360-ton-per-day plant was built
by Japan using US technology and is supplied by Soviet
natural gas. A 300,000-ton-per-year ethylene plant at
Boehlen, built by Austria and Belgium, began operation
in February and has been supplying ethylene to Czecho-
slovakia by pipeline since March.
July 25, 1975
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