DAILY DIGEST JUN 19 1951

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79T01146A000200440001-2
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 17
• Document Creation Date: December 9, 2016
• Document Release Date: June 12, 2001
• Sequence Number: 1
• Publication Date: June 19, 1951
• Content Type: SUMMARY

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CENTRAL INTELLIGENCE AGENCY
Date: JUN 19 M51
49236
G~
COPY NO.
NOTE: 1. This summary of significant reports has been
prepared primarily for the internal use of the
Office of Current Intelligence.. It does not
represent a complete coverage of all current
reports in CIA or in the Office of Current
Intelligence.
2. Comments represent the preliminary views of
the Office of Current Intelligence.
Marginal letter: indications are defined as
follows:
"A" - items indicating-Soviet-Communist
intentions or capabilities
"B" - important regional developments
not necessarily related to Soviet/
Communist intentions or capabilities
"C" - other informatipn indicating trends
and potential developments
State Dept. declassification & release instructions on file
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SECTION 1 (SOVIET)
EASTERN EUROPE. H[TNGART. Hungarian Catholic Leader to be Tried, Radio
Budapest has.announced that Archbishop Jozsef Grosz will be brought to,
trial with eight other persons-An charges of anti-state activity, espionage,
preparation for revolution and forming armed terrorist, units. (U NY Times,
19 Jun 51). COMMENT: Archbishop Grosz and three assistants have re-
portedly been under arrest since 19 May. (O/CI Daily Digest, 26 May). As
acting head of the Hungarian Bench of Bishops since Mindszenty's imprison-
ment, Archbishop Grosz has been the spokesman of Catholic opposition to
the Communists. He has been under attack during the past few weeks for
refusing to sign the Communist peace plebiscite.. The Hungarian {Communists
apparently have most of the other bishops under control; Archbishop Czapik,
the leader of a more pliant faction within the Bench of Bishops, beads a
Catholic delegation which is currently discussing Church State affairs with
Istvan Kossa, Communist president of the recently established State Office
for Ecclesiastical Affairs. It has been reported that Aloysius Pongracz,
a Hungarian employee of USIS who was arrested on 24 March, is implicated
in the charges against Archbishop, Grosz. This maneuver would provide the
Hungarian Government with an opportunity for placing renewed pressure on
the heretofore relatively unmolested operations of the USIS office in
Budapest.
POLAND. Industrialization Planned on Lone-Range Basis. The US Embassy
Warsaw reports that there is no evidence that Poland is retarding-mr post-
poning the construction of heavy industrial projects in favor. of greater
efforts on items of more immediate military utility. According to the
Embassy, Poland has achieved impressive industrial progress during the past
sixteen months and currently seems preoccupied with insuring the'orderly
achievement of production goals. The Embassy points out that this emphasis
on industrialization should contribute appreciably to the Communist war
potential in the next few years. Noting that Poland has been relatively
free of purges and sensational trials, the Embassy concludes that the USSR
may desire to retain Poland as a point of relative calm during its agitation
of more sensitive areas, and also probably wishes not to disturb the im-
portant communication route to Germany through Poland. The Embassy trans-
mits the view of the British and French Ambassadors in Warsaw that they see
no signs of Soviet intentions, to attack theiWest. (S Warsaw 971, 16 Jun?51).
COMMENT:' All available evidence indicates that Poland has stressed expansion
of its heavy industry under the Six Year Plan, with less emphasis upon con-
struction of?immediate military usefulness. This furnishes a sound psycho-
logical approach to the nationalistic Polish people who see in this industrial.
expansion the growth of their country. At the same time the USSR has been
infiltrating Soviet agents into even relatively low level Polish governmental,
industrial, and military positions, thus insuring its firm control of Poland.
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POLAND. Batory to fterate on Indian Route. A recent announcement in the
Polish press stated that the. 14,000 ton passenger liner Bator y, formerly
on the Gdynia-New York run, was being refitted with air conditioning for
tropical service and would begin operations on a new line connecting
Gdynia with Indian and Pakistani' ports. The route of the Batorr will be
Gdynia, Southampton, Gibraltar, Malta, Port Said, Aden, Karachi, and.
Bombay. The ship is presently being refitted in a British yard, (R Warsaw
968, 15 Jun 51). COMMENT: The addition of the Batory to this run follows
an observed trend of increasing numbers of Polish and Polish-chartered
vessels on Middle and Far Eastern routes.
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SECTION 2 (EASTERN)
Gam. KCcsmplain about Palo King Paul recently pre-
sented a lengthy exposition of his complaints against former
Commander-in-Chief Pap agog to US General Fredericks -4dch ended
with the statement that the marshal is-mentally ill. In the
same breaths, the King stated that Papas s remained available to
the country in case of war or of need for his services in a
NATO command. (S Athens 4469, 16 dune 51). C ? In the
US Embassy?s view, there is no.foundation to the ailegatton
that Papagos is mentally ills and all available information
confirms that he i s o f perfectly sound mind. Following Papago s'
resignations Prime Minister Venizelos immediately attempted to
capitalize on the si tuation by su ggesting that the dilemma be
solved by the entrance into NATO of Greece and the assignment
of a command position to the Marshal.
Eject" n State. A Karachi broadcast of 10 June
reported that ex=Congressman P. C. Ghosh?s reformist Krishak
in Nest Bengal and the Socialist Party of
t
P
y
ar
Praia Mazdoor
India have agreed to cooperate during the forthcoming national
elections by not putting up, candidates a&.inst each other
rl~noe
areas where the candidates of either party have a clear
a arrange-
ments success against Congress Party candidates.
ments are being made by Dr. Ghosh with the Forward Bloc and the
Revolutionary Socialist Party. (R FBID9 Far East, 14 June 51).
~s This type of arrangement can be expected to develop
in local areas throughout India as-.the most effective means of
providing stiff competition to the Congress Party.
"C" Bt)RMA.rmese Refusal o__01= 1 with Kem Amendment Antics ted
~' n a-a_ _:d' A9-m
not provide the certification requ r em Amendment appears
ort by Burmese policy makersi in Rangoon. The Embassy
be su
t
pp
o
adds that it is doubtful that this attitude will change even
though the result may be the termination of ECA aid. (S Rangoon
9189 15 J'une 51).-
"C" An mist Sentiment Amona Chinese Evm ~s Intensif ied
ComlLM st. Pressa r??, Chinese Communists in Burma are utilizing
fear, with increasing effectiveness, as a psychological weapon
to combat the rising ti de of an3 ~Comnist feeling within the
Chinese community. The _antimCommannist Chinese are being accused
of the recent murder of a prominent pro-Comm ist, businessman.
(See 0/CI Daily Digests 12 June 51). The left-wing press., both
Burmese and Chinese, are labelling all non-Communists as pro-
Koumi.ntang and are calling upon the Burmese Government to suppress
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their activities, At the same time, a whispering campaign is
being assiduously promoted to the effect that Burma will soon be
overrun by the Chinese Communists and all persons identified as this being pro-KMT will be executed. The
immediate offa new
Communist effort have been apparent
anti-Communist daily newspaper was delayed for five days, two
prominent Chinese leaders cancelled a scheduled call on US Ambassa-
dor Key and the Chinese educator to whom the US Embassy was to
deliver 609000 non-Communist Chinese textbooks just
eseived longcould
not be reached. (S. Rangoon 918, 15 Jun 51). ~?
Burma remains unstable and defenseless., the anti-Communist senti-
ments known to be entertained by the local Chinese community are
not likely to be expressed with vigor. Scattered violence involving
the two factions is to be sesfor?int lligenc~e,cis
has been relying on the
not likely to succumb to Communist pressure to curtail the activities
of this faction.
tration Re orted South of French 25X6
nB" INDOCHINA. Large t Minh Concen
Tonkin Defenses, reported that 30?40'000
are apparen newly arrived, are con-
enemy troops 9~ t of whom marq
enemy
west of Phuly, on the southern perimeter of the Tonkin
Delta defenses. This force is so situated that it can, under cover
of darkness, move into position to attack within twelve hours,
( S, Hanoi 744 18 Jun 51). COM z General De Lattre is reported
as anticipating a heavy attack in-the area mentioned. Although Fren t
regular forces in the entire Tonkin defense triangleber onlyoa
679000, he is expected to repulse the attack by a troops there. De Lattre's greatest fear is that the Chinese Communists
will attack his northern. defenses simultaneously although there is no
reliable evidence to indicate that such a move is imminent.
"A" Fourth Field Army units Move from Korea to KwaPg&u . The
CHINAo
lements of the 38th, 39th, 40th and 42d
f
e
o
presence in Kwangtus
armies of the Fourth Field Army, all reported recently withdrawn
25X1C from Korea, is now accepted as confirmed by the American Consul
ea 25X1C
General in Hong Kong. placing
est that these
of these unit's strength in Kwangtung a - 9 e
are not entire armies but possibly divisions representing the first
echelons withdrawn. Indications have been observed that es es
are being increased to full strength by incorporating personne
local reserve and public security divisions which are the (e'vesng H
being replenished by intensified recruiting in the area. COMA s The with-
drawal Kong 3794., Joint Weeka 24, 15 Jun 51).
of these units to positions in Kwangtung.for recuperation and
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"C"
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replacements and lends credence to the reports that, the Fourth
Field Army, which has long had other;elements of its organization
in this sector, has been relieved of its commitments in Korea and
been assigned the defense of the South China coastal areas. The
46,000 strength figure given for the above units, if based on full
division strength of 9,000, appears consistent with current casualty
estimates,
Chinese Co s lead-11.
dor to Peiping, The Chinese "were to present " a lengthy memorandum,
prepared by the Revolutionary..Military Council and the Government
Administration Council, discussing Chinese losses in men, money and
materiel in the Korean conflict, and specifying the items and quanti-
ed b the Chinese from the
e Communist "Memorandum" to the Soviet Embassy.
for four hours with the Soviet Amoa
25X1A tied of "military and other supplie re uir y COM[++EfiTTs Peiping"s
Soviets",
current campaign, which is to last a east un- January 1952, for 25X1A
funds to purchase heavy equipment for Chinese forces in Korea, indi-
cates that Peiping has made or is attempting to make arrangements
with the USSR for the supply of such equipment, The above report,
which is unconfirmed may illustrate either a substantial or a cere-
monial'step in such Sino-Soviet negotiations,
"B" US Military Adviser Recommends Release of Nationalist Troops
Interned in Indochina, General Chase, Chief of the Military Aid and
Advi7o-iF Group in T wan, recommends that the US take strong action
to assist the Chinese Nationalist Government in effecting the release
and transportation to Formosa of all Chinese military personnel
in Indochina. He states that they are good troops and badly needed
as replacements, The Chinese Nationalist Government can transport
them from Indochina at no expense to the French,, who would thus be re-
lieved of the present heavy cost of maintenance, The US Charge in
Taipei concurs, and suggests that favorable action from the French
would provide an excellent example of international cooperation against
the Communist threat and,1at the same time, constitute an imporlant
contribution to the defense of Formosa, (S, Taipei 1727, 16 Jun 51),
COMNI`fs An estimated 30000 Chinese Nationalist soldiers of unknown
effectiveness are currently interned in Indochina, On several occasions
since the end of 1949, the French have considered requests: originating
in Taipei that these troops be returned to Taiwan. For fear of provok-
ing Communist China into more overt action against Indochina, the French
have refused to accede to these requests and have maintained a dipl lo-e
matically correct attitude in the matter. They are not likely
easily persuaded to reverse this policy,
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 replacement anted' lends credence to the reports that the Fourth
Field Army, which has long had other:ellements of its organization
in this sector, has been relieved of its commitments in Korea and
been assigned the defense of the South China coastal areas, The
469000 strength figure given for the above units, if based on full
division strength of 9,000, appears consistent with current casualty
estimates,
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Alleged Chinese Communist "Memorandum"
Chinese Communist leaders met for four hours with the Soviet Ambassa-
dor to Peiping. The Chinese "were to present " a lengthy memorandum,
prepared by the Revolutionary.Military Council and the Government
Administration Council, discussing Chinese losses in men, money and
materiel in the Korean conflict, and specifying the items and quanti-
25X1A ties of "military and other supplies required b the Chinese from the
Soviets", COMMENTz Peiping"s
current camp".. which is to last at least until January 1952, for
funds to purchase heavy equipment for Chinese forces in Korea, indi-
cates that Peiping has made or is attempting to make arrangements
with the USSR for the supply of such equipment, The above report,
which is unconfirmed, may illustrate either a substantial or a cere-
monial step in such Sino-Soviet negotiations.
"B" US Military Adviser Recommends Release of Nationalist Troops
Interned in Indochina. General Chase, Chief of the Military Aid and
Evisory Group in Taa.wan, recommends that the US take strong action
to assist the Chinese Nationalist Government in effecting the release
and transportation to Formosa of all Chinese military personnel intern-
ed in Indochina. He states that they are good troops and badly needed
as replacements. The Chinese Nationalist Government can transport
them from Indochina at no expense to the French, who would thus be re-
lieved of the present heavy cost of maintenance. The US Charge in
Taipei concurs, and suggests that favorable action from the French
would provide an excellent example of international cooperation against
the Communist threat and9lat the same time, constitute an important
contribution to the defense of Formosa, (S, Taipei 17279 16 Jun 51).
COMMENTS An estimated 30,000 Chinese Nationalist soldiers of unknown
effectiveness are currently interned in Indochina. On several occasions
since the end of 19499 the French have considered requests originating
in Taipei that these troops be returned to Taiwan. For fear of provok-
ing Communist China into more overt action against Indochina, the French
have refused to accede to these requests and have maintained a diplo-
matically "correct" attitude in the matter, They are not likely to be
easily persuaded to reverse this policy,
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25X1C acts All, egad Presence of Soviet Troops in Southeast Manchuria.
larch 1951, o f 209 000 Sovi et infantry troops i n th eTumen area
.
16, 000 troops in the Tunhua area (with 700 B? small tank s1? or
arm. red cars) and an unknown number of Soviet troops (appar ent].y
25X1A some hundreds) at the Chflao ehuan and L sung railroad
presence of some thousands of Soviet tro ops in Manchuria, in
connection .th such a program,, is a'strong possibility,
nchur ,aa. Although specific reports cannot be confirmed. the
stations, COMMENT.
Other low-l es nave ieported the movement of Soviet
troops into South Manchuria in or about March 1951. There are
recent indications of the existence of a large-scale Soviet
program of training and equipping Chinese Communist forces in
25X1C no" H avgr Mili tar
sh.i e mili tary
shipments on e newly-built railroad to Nanning in Kwangsi
Province were heavy in late May. Source cites the tipment of
450 mums of gasoline on 28 May., five cars, cf ammunition and
25X1A light weapons on 30 May and fivA anti-aircraft guns on 31 May.
C OMME NT s Nanning, the
mentioned as a transshipment center for military supplies to
Ho Chi Minh forces in Indochina. A number of reports claim
that the railroad to Nanning has operated only intermittently
since it was opened to traffic in March, due to gzerrilla
raids and floods.
ouch China railhead nearest the Indo china border. is frequently
KCff.EAS North Korean Cabinet Encourages Increase of Exports
and Decrease of Imports . Radio Pyongyang announced on 18 June
the issuance of a North Korean Cabinet decree which establishes
a system of monetary rewards far citizens who aid in conserving
foreign exchange by increasing the exploitation of export
resources or the invention of substitutes for imported goods.
A largo list of its in the fields of chemicals,, textiles,
transport, foodstuffs, hardware and electrical equipment are
mentioned r name as included in the grogram; (R FBIS ticker,
18 June 51). Cho While the broadcast reiterates the
shortages existing in North Korea, various possible explanations
for this gwogram appear plausible. Comm mist countries normally
lay heavy stress on self-sufficiency and also this new propaganda.,
no doubt, is designed to help maintain production at the highest
possible peak Additionally, the USSR may be pressing for
payment, in the form of raw materials, for aid given the North
Korean regime.
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SECTION 3 (WESTERN)
"B"
f
GERMANY. Ex-Officers Organize to Combat Rearmament, The first major
a E of ex e ac officers to ctea a an an i-rearmament movement
among west, German veterans came in a meeting at Uelzen on 3 June of some
400 former officers. The meeting was not immediately announced to the
press with the notable exception of the Soviet news agency; the first
papers to carry the story were a neutrality-minded journal and a Communist
Party organ. The principal speaker rejected the rearmament of west Germany
under present circumstances becauseg he said, a German contingent would not
be able to hold out against Soviet aggression for more than a few weeks.
He criticized west Germany's two largest veterans, organizations, which
were not officially represented at the meeting, for their approval of
gradual remilitarization, One of these organizations, subsequently dis-
avowing any connection with the Uelzen meeting, charged that it was in-
all likelihood "inspired and financed by'the East". US representatives
in, Bonn consider that the propaganda of the Uelzen movement, couched in
technical terms and carrying the air of staff authority, will undoubtedly
have considerable success outside Communist ranks, and that the group may
develop into the most dangerous anti-rearmament movement, (C Bonn Un-
numbered, 15 June 51) CO 4ENT: The former west German military have been
notably lukewarm toward rearmament, so that the Uelzen movement would seem
to have a fruitful field in which to operate, unless-it were exposed as a
Communist front organization. Superficial evidence suggests that if it
is not a front, it is at least Communist-infiltrated,
Soviets Relax Berlin Trade Restrictions, The USSR has apparently
relaxed its current restrictions on west Berlin's exports to the West,
although Soviet representatives in Berlin still-claim the right to control
shipments from west Berlin, The Soviets have reportedly released 800 west
Berlin requests for trade permits which had hitherto been held up by them.
At the same time, however, S. A. Dengin, Berlin representative of the Soviet
Control Commission, has replied to Allied protests on the Soviet restrictions
L_ claiming the right of the Soviets to control shipments from west Berlin
as a means of ensuring that no illegally obtained raw materials from East
Germany are included in the shipments. Negotiations on the method of
control are to be held by-Allied and Soviet authorities, (S Berlin 1512
and 1513, 18 June 51; press items, 20 June 51) COMQENT: This Soviet
relaxation of restrictions appears to have result et m the threat of
firm Allied countermeasures, including the simultaneous embargo of shipment
of key items from west Germany and west Berlin to the Soviet zone, and the
cessation of talks on a new interzonal trade agreement.
AUSTRIA. People's Party Appoints New Chieftains, The directorate of the
People's Party has decided to reaffirm all C inet members of the party
in their posts, However, Julius Raab, president of the Chamber of Commerce,
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has been named acting party chairman in place: of Chancellor Figl, and
Nationalrat Maleta, a moderate critic of.the present party leadership,
has been named secretary general in place of Education Minister Hordes,
More significant changes could not be made at this time because the op-
position to the party leadership is without real leaders, and ambitions
have'been temporarily cooled by the unpopular economic measures that will
soon have to be passed. There was also a strong feeling that far-reaching
changes might endanger the coalition. The opposition within the party-will
have another chance to effect changes when a special party convention is
held next fall, (C Vienna 3079, 18 June 51) COMMENT: In separating party
from Government positions, the People's Party Has t en the minimum reform
steps suggested after its recent defeat in the presidential elections.
The policy critics, caught without specific plans this spring, will probably
be ready next fall.
"B" ITALY. Widespread Strikes Loom Throughout Italy.' Both Communist and non-,
Commuunis a or unions are supporting -nation-wide two-hour daily strikes
of all streetcar, bus,'and shortline railway workers in an attempt to en-
-force demands for-wage and cost of living increases. The civil servants'
dispute with the government over cost of living allowances is still un-
settled. Both government and transport workers are threatening a 24-hour
strike by the end of the week (June 21-22) if their demands are not mete
Meanwhile, the Communist-dominated union of agricultural workers has begun
intensive agitation in Southern Italy for strikes and demonstrations to
support demands for wage increases. (S Joint Weeka 24, 15 June 51; U NY
Times, 17 and 18 June 51; R FBIS, 18 June 51) COM19NT Such widespread
labor unrest is unusual in Italy at this time ofthe year, except for
agricultural workers. The Communists, who first took the initiative in
pressing for the recent pre-election strike by government workers, have
reportedly been planning a general strike for some time. (See OCI Daily
Digest, 12 May 519} Retention of initiative in the labor field will
strengthen the Communist-vote in the fall municipal elections in Southern
Italy, where the Communists are likely to gain over their voting strength
of 1948.
ITALY/GERMANY. Italians Emerging as Protagonists of New Germ . In the
discussions concerning -interim arrangements for German libraries in Italy
it appears that the Italians are seeking the role of protectors of German
interests. Meanwhile, West German Chancellor Adenauer's visit completes
the first, cycle of Italian post-war foreign policy that began at Santa-
Margherita with Italo-French agreement on the principal interzonal questions
of the day. The Italian objective is to strengthen Western European unity
by improving relations between France, Germany and Italy. (C Rome 5764,
18 June 51; NY Times, 19 June 51; R FBIS, 18 June 51) COMMENT: This
series of steps to strengthen western European unity is design d; (1) to
improve Italy's political position in the councils of the west and (2) to
make Italy a more viable. entity through Western European economic integration.
In addition, Premier De Gasperi's initiative in this policy probably reflects
Vatican desires for a stronger Germany as a bulwark against Communism.
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"C" UNITED KINGDOM, Left Wing Labor Party Group to Wage Vigorous Intra-
Party Campaign thisevSutmner, According to US Embassy London,'ex-Cabinet
Minister Aneurin anPs small left-wing Labor Party group will formally
initiate its campaign to gain Labor rank-and-file support when it publishes
early in July its statement on Labor Party policy entitled "One Way Only".
The new policy statement, which bears the signatures of 24 MPs, reportedly
advocates a sharp reduction in the rearmament program, nationalization of
25X6 additional industries, and the pursuit of a.forei n policy more independent
of that of the US0 that
Bevan wants to wage a vigorous campaign during e _ summer and at .the-.-Labor
Party conference in October and is hoping for evidence of considerable sup-
port at annual trade, union and constituency Labor Party meetings held during
the next few months. It is believed, also, that he would not want a general
election called early in the fall for in that event the large October
conference of the party would be canceled and Bevan would almost certainly
be out-voted at the private conference-of party leaders which would draw
up the election platform. (C London 6627, 15 June 51; NY Times -18 June 51)
COMMENT: Although Bevan and his professed followers constitute" a very small
minority of the Labor Party at the present time, there is little doubt that
his views are regarded sympathetically by sizeable numbers of doctrinaire
socialists and some trade unionists disgruntled over-rising living costs.
The party leadership will certainly keep a watchful eye on the development
of his campaign; and if its progress seems to threaten a bitter fight at
the October conference, those leaders favoring an-early fall election would
have an additional argument in the general desire to avoid an open party
split.
Initial USSR Offer Rejected in UK Timber Contract Talks,
UK Board of Trade officials' state that they have rejected the initial' Soviet
offer in the current negotiations for renewal of the 1950 UK-USSR timber
contract, but that negotiations are continuing. The rejected offer proposed
a barter arrangement involving the exchange of Soviet timber for a variety
of commodities, including industrial diamonds, tin, copper, machine tools,
and rubber, equal to half the value of the--timber, and the remainder ap-
parently in sterling credits. (C London 662) , 15 June 51) 'COMfENT; The
UK normally depends.on Scandinavia.and Eastern Europe for _ most, of its timber
supplies, but the'"current improvement in its timber position over 1950 is
-due to recent large purchases in the US and British Columbia on long-term
-contract. However, these purchases at high prices constitute an obvious
drain on.UK dollar balances, and the UK overall payments position has in
other respects deteriorated in the past two months. According to press
reports, the UK is now seeking to secure large amounts of the high quality
Soviet grades to insure-adequate supplies suitable for construction and _
finish purposes in 19529 but has been unable to accept the Soviet conditions
concerning shipping, since the shortage of cargo tonnage and port delays
are now the major bottlenecks in the UK timber trade, The UK has given no
specific indication of its attitude toward the Soviet interest in critical
dommodities in these negotiations, and it is uncertain what, if any, conces-
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sions the UK would be willing to make in order to secure agreement,
"C" IRELAND. De Valera Announces Foreign Policy to Remain Unchanged, Prime
Minister De Valera indicated to- a press conference on June at he
would make no, change in the preceding government's policy of neutrality
but that he would push defense preparations. Meanwhile, US Embassy Dublin
reports that he has assured the five independent members of the Dai1, whose
votes were decisive in bringing him into office on 13 June, that his govern-
ment will remain in power for at least three years. Noting the slim par-
liamentary.margin on which the.De Valera Government depends, the Embassy,
reports that the opposition is, however, "much demoralized",, (U NY Times,
19 June 51; C Dublin 2L6, 15 June 51) COMMENT:, The new government's
position on foreign policy was generally anicipated (see OCI Daa1y_Digest,
111 June Si) . It is not likely to make any large additions to Ireland's
tiny defense budget, for De Valera's previous criticisms of the Costello
Government on this score were of a.rather cautious and sporadic nature.
The parliamentary. instability of the new government is the less significant
in that there seem at present to be no issues of importance on which the
opposition is likely to attack it,
"c" Cam, New Labor Stoppage in Copper Industry. An illegal strike of workers
in the two large US-owned Chuquicamata.and Potrerillos copper mines--begun
four days ago--has now spread to include the US-owned El Teniente mine,
number two Chilean copper producer. Nitrate, coal, and railway labor leaders
reportedly are actively negotiating for authorization from their unions to
stage a strike supporting. the copper workers' demands. Troops have been
ordered to guard the three strike bound mines, and a decree ordering the
"renewal of work" has been issued by the government. President Gonzalez
Videla reportedly has disclosed his plan to form a military cabinet if a
solution is not found to "the present crisis" (presumably that caused im-
mediately by the copper workers' strike and cabinet resignations). (R Santiago
622, 18 June 51; U NY Times, l9-.June 51; R - FBIS, 19 June 51) COMMENT:
Production at Chuquicam to was reduced in May by 50 per cent as a res t
of labor agitation, and total Chilean copper production in June will be
:.~verely affected since approximately 95 per cent of this production is
controlled by the three large US-owned companies, It seems likely that the
newly formed Confederacibn'de Trabajadores del Cobre (CTC) whose strength
has previously been untestecmay be in,a posiTion o bargain successfully
with the government as a result of the present strike which reportedly
follows the rejection by the companies of the CTC's list of workers' demands.
The unstable Chilean political situation may further deteriorate since the
President's talents for political extemporization are limited in this pre-
election year