(Classified) CONSULTANTS' MEETING 23-24 JANUARY 1957

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T00937A000500030052-8
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 10
• Document Creation Date: December 9, 2016
• Document Release Date: February 12, 1999
• Sequence Number: 52
• Publication Date: January 30, 1957
• Content Type: MEMO

Approved For Rale as e 2000/08/07 : CIA-RDP79T(0337A000500030052-8
CENTRAL INTELLIGENCE AGENCY
STAFF MEMORANDUM NO: 8-57
25X1A
SUBJECT:
25X1A5a1
OFFICE OF NATIONAL ESTIMATES
30 January 1957
Consultants' Meeting 23-24 January 1957
25X1A5a1
The Consultants taking part for both days wee Messrs.
. From
ONE, Messrs. present 25X1A9a
for both days, and for 24 January.
25X.1A9a
The Consultants felt that theeconomic factor was particularly
Important in deterydAng the prospects for national Communism, and that
emphasis should be placed on the role of Yugoslavia and China in the
current Soviet-Satallite crisis and on the broadened range of alternative
possibilities in the present situation.
25X1A5a1
The .Consultants felt the Scviet position was strong and would
almost certainly gr.: r4 stronger in the Middle East, and that Saudi Arabia
was a critical focal point in the current situation.
The Consultants thought that emphasis should be placed on the
growing strength of Communist China both internally and internationally
although reservations were expressed about actual Chinese accomplishments
in agriculture. They felt that greater allowance should be made for, the
possibility of a return to a hard line in Asia.
The Consultants considered the prospects of either neutralism or
extremism in Western Europe not alarming at present. They thought that
Europe was showing some signs of slowly moving toward a more unified and
realistic position in world affairs, but agreed that the psychological
and political problems of adjusting to new relationships would be
formidable,
MINikiiiiin DOCUMLNTNO
NO CHANGE IN CLASS A
il DECLASSIFIED
CLASS CHANGED TO: IS S 0
NEXT REVIEW DATE: MO _
AUTH: HR 70-2
DATE:, 26 0 REVIEWER 00612.54
Approved For Release 2000/08/07 : CIA-RDP 9 00937A000500030052-8
Approved For Release 2000/08/07 : CIA-RDP79T4837A000500030052-8
STABILITY AND COHESION IN THE SOVIET SATELLITES: (NIE 12-57)
25X1A591 In discussing
the basic factors affecting stability and cohesion,
felt that the attitudes of the free world should
e Included, and tiln tte demonstration of unwillingness to accept risks
in aiding a UN2441b6944opealing for aid would have profound repercussions
in the area, suggested that the influence of nationalism and
of anti-Communism should be separately consiclerec5101A?B1Lt might be
impossible to assign a relative weight to each. 111111111 felt that nationalism
was only the garb and rallying banner for anti-Communism, and that this
anti-Communism in Eastern Europe had remained undiminished. He considered
the lack of a larger protest vote in ttp41?Oliph election explainable only
in terms of the regime's use of inti4daktclidb,nd repression. However,
most of the Ogg-34.04s agreed with that the Poles simply
thought GomuiRliA-WAte best they could get in the wake of the Hungarian
experience, thought that fear of Germany was an important factor
in producing the rally bellA
ti(Gomglka.
2. Economic factor: questioned the relative lack of emphasis
in the paper on economic factor, which he considered the critical one
2t3i1..v. of future prospects for the area and possible US courses of
?c 'The Consultants generally agreed with the argument advanced by
that the degree to which a national Communist solution of the
Polish type proves viable may depend on its
^V /0 solveNonomic
problems, and that solving these problems m-Ifficilp"as-Tket-Vil of
some of the guts of the Communist system. and felt that as
the image of the Hungarian experience wanes, it w qiminishing
force for inducing stability and conformity in thYWPWAi that economic
conditions will become increasingly determining, thought that
a special paper shoul4bg i%ten analyzing the economic debate in Poland
and the implicationsl Meal overtones of the reorganization of
the Polish economy, felt that attention should be paid to the non-
Communist liberals and modernizers in some of the Satellites who might
be able to_workl
_for a phased liberalization from within.
25X1Aba
3. thought that the possibilities of improvements in Poland's
economic situation were better than implied in the estimate. He thought
that increased incentive to work for an independent regime among the
workers and the substantial pltential of Poland's managerial class might
bring about considerable progress. He pointed out that Poland has a
higher productivity in coal per worker than England and France, and that
it had a basically rich and balanced national economy. Many of its
2
imaricaram
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
. Approved For 4ease 2000/08/07 : CIA-RDP79W37A000500030052-8
problems might2W
expenditures.
economic prospects.
increase production un
SECRET
Western aid and lowering of military
are men_pepsimintic about Polish
pointed25Xued inabilities to
er omulka;
doubted that steps such as
wage concessions would prove even as successful as Stalin's more
repressive methods in effecting economic improvement.
L. WithdrawaLl_prospectss Although the Consultants generally
agreed with the basic estimate that the USSR is not now genuinely
seeking a formula for pulling out of Eastern EuropoitAllt that the
paper ruled out too summarily the possibility that '4661 'would give
more serious consideration to some kind of offer0
suggested that the Soviets would progWit$4441. out of Eastern Europe
if we pulled out of Western Euroe thought the USSR might even
look with favor on Poland gettin rom the US to help it out of
its current economic situation. felt that the categorical
estimate about Soviet determinailion to retain conty..ol in Eastern Europe
(last sAttence of paragraph 19) oversimplified the picture and gave
insufficient weight to tha tremendous costs the USSR faced in maintaining
that control. He felt that although a flat withrawal proposal would
not be accepted, stress should be placed on the fact that a new context
had been created in which the range of alternatives had necessarily
broadened.
Implavia and China: There was general agreemont that more
24AtfehaAhould be made of the rile of Yugoslavia and Communist China.
thought that the palitical considerations which were paramount
in inducing the USSR to reject, reaccept, and then r2,5Xe1rito must
also be operative in their policies toward Poland. ==agreed that
prestige was a critical Soviet consideration and thought it degrading
for the East Europeans and unparalleled for the OX15W(11 in Chou
En-lai to smooth things over in the Satellites, felt the use of
China as intercessor was not resented and was probably an effective
cynvincing in the Satellites that despite temporary problems they
2 lof a much larger bloc which is still the wave of the future.
suggested Finland might prove a better example of an eventual
outcome in some of the more troublesome Satellites than Yugoslavia. In
some respects, a Finnish solution was preferab t. Eftoist one since,
despite its non-Communist government, Finland ,.- Ale subject to Soviet
dictation on foreign policy than Yugoslavia. thought that
Soviet relations with Communist China might be the pattern that the Soviets
had in mind for future dealings with the East European Satellites.
- 3 -
SECRET
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
Approved Forgo lease 2000/08/07 : CIA-RDP79W937A000500030052-8
SECRET
6. Permissible variation: On the question of what and how much
variation the USSR will be able to tolerate in its Satellite empire,
there were three positions put forward by the Consultants.
25X1A5a1
a. tented to think that Soviet policy had to be
toward the area as a whole, and,W,Mhe same considerations of
prestige and political power wiff1tlY04514 stiffen Soviet attitudes
toward the region as a whole, pointed out that the
Bloc has been almost as uniform in it?s?Rattern of rehabilitation
and partial reexcommunication of Tit,1104.61A5Ws in its original
denunciation and purges of 1948-49. tended to support this
position by suggesting that the Soviets suffered no real hesitation,
only a necessary tactical pause waiting for reinforcements before
crashing the Hungarian uprising. Most of the Consultants agreed
with the estimate that any defoction from the Bloc except by
Albania weuld be unacceptable to the USSR.
2bx1Abai
b. felt that the USSR would have to continue to
insist on uniform responses to the outside world, but can and will
allow for censider2bx1Abai able and increasing variations in domestic policy.
c. felt that the USSR would allow for general divergence
between countries, wherever unavoidable, rather than attempt to
,cti,:lguish between domestic and foreign policies, which2re044581
45wi1ebvit in key issues such as foreign trade and aid.
favored sore discussion of the Satellites as individuals.
got little support for his idea that a soft neutral area
to the South might be sanctioned by the USSR; but there was
considerable sympathy for the idea that the USSR might fall that
it could continue to sanction divergences in some of the Satellites,
because of the national interest of countries like Bulgaria and
Czechoslovakia in maintaining close contact with the USSR and the
inability or disinclination of most Satellites to follow the
Polish example at present.
7. Mil lificance: On the military importance of the area
to the Bloc, thought that while the USS'1-1, contiwc) to value
Eastern Europe for defensive purposes, it must have writ460ii&lie
area for possible offensivA,wwest Western Europe. thought
the area was still consideed? 1 as a base even if local forces
could not be trusted, andlilinithought the tec ny,k)zp_p). strength of
Soviet forces had so increased that the Satelli 51VitteV'had lost much
of their imppTtance in Soviet planning anyhow. thought that the
4
SECRET
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
? Approved For Release 2000/08/07 : CIA-RDP79114937A000500030052-8
SECRET
building up of Satellite military forces had probably contributed
to nationalism in the area -- and would probably inevitably do so if
(1) conscription was used and (b) high professional standards were
attained.
8. Attraction of West: The Consultants thought some mention should
be made of the attractive force of Western Europe in both the ecda5AWal
and ciultural realms to many of the Eastern European Satellites.
said that the Polish government has urged the Rockefeller and.Ford
foundations to open contact and that exploratory missions have already
been sent to Poland by both foundations. (A fact still being kept
secret.) He thought that the experience of Yugoslavia in 1950 (when
90% chose English and only 2% chose Russian as their second foreign
language after the choice was made elective in Croatia) would probably
be repeated in other Eastern European Satellites if a choice was
permitted. There was goneral agreement not to expect much from the
Czechs, however, who were thought to be faring well economically under
the current arrangements and enjoy about as much contact with the West
as they probably wanted.
MILE EAST 25X1A5a1
9. Soviet strengths: In answer to introductory question
on the strength and weaknecAD,g4ofrttle Sov e position in the Middle East,
il
the Consultants agreed thadi'A'tqlet position was strong and would
probably become stronger. related Soviet stvength in the area
to the fact that they are interested at present in getting the West out
rather than getting themselves in. He .suggested that the USSR did not
intend to send in volunteers, but that they were thrown off base by the
US censure of the UX and France andaAtpex had to establish for
future propaganda purposes the fact /V* were willing to go even
farther in supporting the victim. 11111111thought the situation was
somewhat analogous to that of 1938 in Czechoslovakia where the Soviets
bA).MLIDArluch credit,;VAI.mp_pnting in the minds of the people that only
Zlid,--Wilas willi31?1AAD them militarily when the chips were down.
agreed with that the USSR had succeeded in establibhing
this distinction in the eyes of the people of the area, and that in
pressing for any kind ofp,rwnpble settlement the US will necessarily
become aligned even more4Rft iNolUK, France, and Israel. Most
Consultants agreed with that the USSR was not being strained
economically by aid to the Middle East, and that they were getting
disproportionate psychological returns for their obsolete arms and
unsaleable surpluses.
25X1A5a1
10. Against suggestion that the Soviets might exploit
the current Middle Eastern situation to better their position in the
5 -
SECRET
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
Approved Forditelease 2000/08/07 : CIA-RDP79500937A000500030052-8
SECRET
25X1A5a1
Turkish straits, pointed out that Soviet acceptance of
the principle of n verignty in the Suez crisis would handicap
any such efforts. thought the USSR would prefer bilateral
dealings with the Turks in any case. He speculated that the USSR would
probably fl5A1',0@ilunbers of speoialists to Syria if Jordan were
attacked. 111111111 Amentioned that Nuri was not urging US adherence
to the Baghdad PAct in December, but rather increased US aid, particu-
larly to IR151)51*R@A Nuri considered the weakest link in the Baghdad
because the Baghdad powers preferred not to be inhibited by direct ties
Alliance. speculated that Nuri might have taken this position
to the US if they decided to initiate action against Syria in collusion
with the Turks.
25X1A5a1
11. SalkAa3441: There was general agreement to
assertion th4tit-laiT5Arabia was a critical focal point in the present
situation. commnted that Saud was playing up to Nasser to check
Iraq, but that he doesvrt want to be completely committed to Nasser and
has been hurt by the closure of the canal. Saud is dependent on
opportunistic Palestiniars for administration; and they support Saud
bucause they feel that he alone has the financial potential to help them
get. Palestine back. Sa.2, doesnit realize that he is building 112 a class
that might eventually overthrow him; he seeks to solve everythin4WA5a1
spreading his wealz,h around a little wauaiply. In answer to
speculation that some groups in Saud?oii, Alight eventually try to
call in the Russians to run Aramco, pointed, out that the problem
was marketing the oil; and that so long as petroleum Was available from
Iran and Kuwait a shut-off of Arabian oil would not seriously hurt the
West.
12. Settlement Prospec
Wonsultants agreed that there was
no other practical way but t UN to take the first steps toward
an Arab-Israeli settlement. I1hought that, with world attention
focussed on the area, now was a ggqtAgeo press for some sort of
settlement, or at least to create4R t in which final settlement
Oluglimately be worked out. felt that a settlement could
detilgOed if the US was willing to apply pressure on all parties.
thought that the value of a set4l@Mpliit 041ould not be exaggerated,
since the Arabs would almost certainly 4Azifin&athey had been cheated and
become further alienated from the US. thought that a substantial
quid pro quo woul yqobe arranged for the Arabs, since any settlement
would seem to haviitl fb4V. the Israeli position as a result of their
military action, thought no solution to the problems of the
area was feasible unless the focus and frame of reference for a solution
were broadened and the impression countered in the area that the US was
seeking to buy people off on a short-term basis.
- 6 -
SECRET
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
25X1A
Approved Fort Release 2000/08/07 : CIA-RDP7980937A000500030052-8
SECRET
COMMUNIST CHINA (NIE 13-57)
25X1A
mdii. International Posture: There was general concurrence with
suggestion that a five-year estimate should emphasize that
the Chinese may suddenly revert to Ar4Wrlipe once they have neu-
tralized international opposition,.R-rissbtRibted their position at home,
and built up mass support abroad, thought they might revive
guerilla fighting in Southeast Asia, try setting up a Yunnan in India,
or attempt to capitalize on political confusion in Indonesia. He felt
that having switched to a soft line, the Chinese Communists have to
hold it for a while to consolidate their gains, but that a straight
push for power might take place in the Far East once a genuine atomic
stalemate has been reached in Europe.
14. Taiwan and UN, There was a gene4n6Ail for more and better
intellieonce on the situation in Taiwan. thought the mainland
population was laa2eW456alciled to life in Taiwan and against a return
to the mainland. MMEthought the Soviet pattern of playing on the
Sino-American talks to show that Chiang was throeeh and at the same time
offering comfortable posts to nationalist officials was bound to have
increasing effect, particularly in making the succession problem dif-
ficult. The Consultants agreed that the USSR did genuinely want Com-
munist China in the UN at present, that admAg?ApAthe UN was of
great importance to the Chinese Communistss4WfliFtW they could count on
growing Afro-Asian support for admission. Milithought the Chinese
would make concessions on issues like the American prisoners and the
atahg.eeg the Chinese in Southeast Asia in order to gain admission, but
8(hrtqAtke no concessions on Taiwan or the issue of renouncing force.
IIIIIIIMIthought that the Chinese would make no important concessions,
believing that the Afro-Asian bloc wilstint.ually get them into the UN.
Aoal
15. The Consultants agreQ4qjr1Ah that the effect of the
Hungarian situation has been t6?ilhdfb-a markedly the importance of
Communist China to the USSR. 1111111thought that the estimate should
develop the line that the call for different roads to socialism and
popular front tactics was primarily directed to Asia. Attention should
be paid to the use of local Communist parties to influence non-
Communist governments even without a popular front -- as in Japan where
a small Communist party has forced the left socialists to accept issues
popularized by the Communists and the loft socialists in turn have
4art4444aressure on the conservative government over these issues.
felt that nationalism and socialism were being increasingly
paired together in Asia, and that the constant prodding of the Com-
munist Parties was combining with the surprisingly effective co-existence
7
SECRET
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
smq,"
SECRET
propaganda of China to induce increasingly favorable attitudes toward
the Bloc. He considered the decline of Western-type socialists in
India and Indonesia a sei?cbX1A5a1us davelopment contributing to this outcome.
16. Agriculture: urged that the anlaysis of the Chinese
agricultural situation be sharpened to explain (a) the degree to which
productivity changes have been explainOlpipialgly by the weather,
(b) the kinds of investment being made4RA`Wibillture? and (c) the effect
of collectivization on productivity, said that, except in the
Northeast) farming methods had not changed much, and wondered if the
displacement of small wholesalers has caused the inefficiencies that
resulted from this step in Russia, and what the Chinese will be able to
do to overcome the ap[arent decline in livestock production. He
suspected thaAApvAlF1.9Tease in consumer goods referred to in para. 9
of the draft 6ertWbbcli,1 not take account of the decrease in handicraft
irLdustrios4 thought thdre was frequently a tendency in the
estimate to impart a "Cod-like quality to the decisions and purposes of
the regime."
WESTERN EUROPE
25X1 A5a 1
17. Neutralism: began the discussion on the
memorandum "Thoughts on ?urope cy comme ing that we appe4E44)Ale "feb
the beginning of the period of "atomic blackmail" and may .ftn-b1
series of threats aimed at weakening our base structure, felt
that the E flowers would increasingly insist on having their own
atomic sto avoid the necessity of involvement in a US-USSR
conflict.
8Act 1,he Germans are unlikely to press seriously
for a position of 71 , 'wh' d,practically rule them out as
a great power; and thougt less likely that England and
France would seek neutrality. Ihought that the example of
India whiph has become a great power without atomic weapons might have
a seducta4PAWb on Europeans reappraising their role in the world
today. lso thought that, since Europe would presumably not be
needed by the US to deliver nuclear weapons to the USSR in five or ten
years, European counties might feel able to explore policies at some
divergence from the US in the confidence that we would not let them
collapse.
18. Germany: The Consultants generally agree?4114Vmany was
puilikely to, give up much to attain reunification, felt the
West Germans were wrapped up in their own prosperity and anxious to
avoid rocking the boat. He said that the socialists in private were
surprisingly uninterested in the reunification issue and planned to
concentrate on the rearmament question in the forthcoming elections,
SECRET
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
Approved For*elease 2000/08/07 : CIA-RDP794140937A000500030052-8
SECRET
and that the political position of the CDU had not declined sharply
although Adenauerts personal position had. He pointed our that the
Germans might re4,2ni&v).oping imtermediate range missiles for
retaliatory power4ReetARt"the USSR, by-passing altogether the plane
delivery stage, thought that the Germans, by developing a
gt
military establis en of hi;hly trained specialists using missiles
iil
and atomic artillery, could do as well as they did after 1920.
19. Economic Prospects: The Consultants generally thought that
economic problems would not be a major source of difficulty in Western
Europe unless the Suez Ca41(,psi closed. They agreed that the growth
rate was flattening out, .61ligt Yeactual growth and expansion was
surprisingly vigorous. NW. suggested that in getting rid of over-
ex diobligations around the world, the economic position of
European countries could actually be placed on a sounder basis.
cited Italy end Holland as examples of countries whose
ositions have actually improved with the loss of colonies.
cited post World War II Germany as an example of economic
prosperity without extensive political control. There was general
agreement that the loss of political control would matter greatly
psychologicallb? Dowever, and that the problem of coming to terms with
the new siteNEIHAEAktJellly would be acute, paeacuaarly in the case
of France. felt -Gilat the case of England w er.e4wages are
outstripping produivity, any government - aa 1 kg the necessary
economic corrective would be likely to fall, suggested that
the Labor Party was not? mhd in coming to prJer at present. There
was a general agreement sm was unlikely in
European politics, but were anxious that the
possibility of some new form of nationalist extremism not be written off.
20. European intearationl There
further steps toward European integr
would only be possible to the extent
policies were gracefully abandoned.
was a general agreement that
gr likely, but that this
PeRN.nial positions and
sug,ested that Western Europ&
in some degree recoup its economic position by cooperating in developing
Africa; but it was thought that divisions among the European powers
and the FrencMarl. in Algeria would make any such development
unfeasible. thought that the Africans would, in any case, prefer
to deal unilaterally with the West European powers.
21. Against the general proposition that the peoples of Western
Europe have run out of steam and lost their desire to find new answers
and move tigNRWRIegration, the following arguments were made:
The rising generation in Western Europe
is non-nationalistic in focus, and its interest in efficiency and
9
SECRET
znitttt-t,
Approved For Release 2000/08/07 : CIA-RDP79T00937A000500030052-8
Approved Fob Release 2000/08/07 : CIA-RDP7760937A000500030052-8
iwagCkiiT),
7 7.17qii 77.1!A At
Zfila
streamlining may lead it to desire to overhaul many divisive and out-
modedzwatices in Western Europe.
lAbai
11111 Civil servants in their forties and fifties have now
begun-tar he first time to push integration.
zoA1 bai
The recent choice for NATO secretary-general of
Speak, who isknown as a proponent of closer intra-European co-
operation willing to step on people's toes, may be an indication of
the way Western Europe may want to move. 25X1A5a1
22. There was a general agreement that, in the words of
"the hankering after tile old world will be the biggest obstacle in
the way of the new' in harope. The Consultants agreed that individual
countries had lost ride% of the psychological incentive to continue
playing a big role, but felt that Europe as a whole could play a role
of great and increasing importance and would probably feel it had to
in the light of economic necessity and the political reminder of
Soviet hostility contained in the Hungarian experience,
- 10 -
teenr?
Approved For Release 2000/08/07 : CIA-RDP79100937A000500030052-8