JPRS ID: 9908 WEST EUROPE REPORT

• Document Type: CREST
• Collection: JPRS
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00850R000400040020-1
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• Document Page Count: 43
• Document Creation Date: November 1, 2016
• Sequence Number: 20
• Content Type: REPORTS

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JPRS L/9908
12 Augu~t 1981
West E u ro e R e o rt
p p
(FOUO 38/81)
FB~$ FOREIGN BROADCAcT INFORiVIATiON SERVICE
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JPRS L/9908
_ 12 August 1981
WEST EUROPE REPORT
(FOUO 38/81)
CONTENTS
ECONOMIC
BELGIUM
Problems of Supporting Belgian Franc Increasing
(Jean Pourbaix; POURQUOI PAS?, 16 Jul 81) 1
ITALY
Government, Labor, Management Accord Needed for Inflation
~ (IL SOLE-24 ORE, 26 Jun 81) 4
Social Contract, by Carlo de Benedetti
Wage Indexation: Azlother Look, by Giancarlo Lombardi
Spadolini Announces Economic Policy, Critics Attack It
(IL SOLE-24 ORE, 1 Jul 81, L'ESPRESSO, 5 Jul 81) 20
_ Synopsis of Economic Policy
Final Portion of Program
Centro Europa Criticizes Plan, by Antonello Talamanca
POLITICAL
FRANCE
Sources, Results of CGT-PCF Friction Viewed
(C.-F. Julien; LE NOUVEL OBSERVATEUR, 4 Jul 81) 23
SPAIN
PSOE Senator Explains Opposition to Entry Into NATO
(Fernando Moran; CAI~IO 16, 29 Jun 81) 25
- a- [ III - WE - I50 FOL70]
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Diplomat, Author Explains Support for Entry Into NATO
(Jorge Fuentes; CANIBIO 16, 29 Jun 81) 27
Public Opinion Poll Reports Spaniards Against Entry Into NATO
(Jose Manuel Ari~a; CAMBIO 16, 29 Jun 81) 29
Major Parties Meet To Resolve Autonomy Issue
(CAI~IO 16, 6 Jul 81) 35
b. -
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ECONOMIC BII,GIUM
PROBLEMS OF SUPPOR'1'ING BELGIAN FRANC INCREASING
Brussels POURQUOI PAS? in French 16 Jul 81 pp 12-13
[Article by Jean Pourba.ix: "Expiatory Victim of Financial Laxity Th~ Last Days
of the Belgian Franc?"~
[Text~ For a few weeks now, the situation of the Belgian franc
has once again been eroded, both by a very unfavorable�foreign
situation and domestic factors which are more debilitating tha.n
ever.
From abroad, our currency is 'handicap~ed the :;ame as other cur-
rencies, but more acutely so by the moneta,ristic policy pursued
with selfish obstinacy by the United States. This policy ha.s in a
way replaced the OPEC petroleum shocks (look at the gasoline price~~
and it is translated into American interes+.. rates which have become
extravagant and usurious ~ and which themselves foster a f`renzied
increase in the value of the dollar.
"This policy," writes the financial BULLETIN of the Rrussels Banque Lambert,"largely
eliminates the margin of the other industrialized count~ries to maneuver in adapting
their ~r_tere~t rates to depressed conditions of economic activity, while not pre-
venting their currencies from depreciating substantially with regard to the dollar."
Under the whip of the new increase of interest rates implemented across the Atlantic,
with the prime rate currently perched at 20.5 percent, the dollar has registered a
4~ percent appreciation relative to t,Y~e Belgian franc since last swruner's low point:
from 27.78 Belgian francs in August 1980, the value of the dollar jumped to 40 Bel-
gian francs last Friday.
It is true that 2 days before, the dollar had reached its highest rate with regard
to the DM in 4~.5 years, while the pound sterling in London slipped to its lowest
level in 3 yeaxs relative to the currency of America. The same da,y, the French
franc in Paris reached an historic low at 5.8250 French f`rancs to the dollar, thus
reaching ~Lts lowest point~ according to the INTERNATIONAL HF~fiALD TRIBUNE, in 23
years...
Franc Devalua~ting
As for the Belgian franc, the unhealthy moods resulting from the tena.cious fever of
the dollar and the swooning of its French namesake, would be much less dangerous for
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our currency if the latter were not placed in immediate peril by th$ profound degra-
dation, at the very heart of the country, of the foundations which in principle
support the monetary structuxe.
The peril endangering the franc is so immediate that an important real estate firm
did not shrink from displaying a large advertisement in last weekend's newspapers,
headed by this short sentence printed in headline type: "The franc is devalixating..."
(in French in the French speaking press and in Dutch in the Dutch newspaFers~.
Not so very long ago, the authors of this alarmist announcement would not have es-
caped legal proceedings for having attacked confidence in the currency. In the past,
some people were taken to court for less than that. Since then, w~ seem to have be-
come more apathetic or more realistic.
The Voice of Cassandra
M~reover, this revealing "message" follows closely upon the dramatic picture of the
s~;ate of our public finances painted by the Superior Council of Finance. The Coun-
cil has estimated the budgetaxy deficit for 1982 at the mind boggling figure of
350 billion francs and this is not contested by Maxk Eyskens. And the overall
_ deficit which the public authorities will have to finance next year God knows
how! was estimated at a mere 650 billion francs.
"Without a fundamental recovery," the Council rightly stressed, "the dynamics of the
increase of the public debt burden* and of unemployment expenditures alone will
bring the deficit to an explosive level in a short period of time."
And the wise men issued this warning: "The Superior Council of Finance wants to
draw attention to the catastrophic depletion of the public finances and to the
- extreme urgency of b~inging about a radical recovery."
This warning had been issued on3y a few days, when the National Bank of Beigium
circulated a"weekly situation report" demonstrating the national and international
repercussions of the advice formulated by the Council. By turning the attention of
Belgian and international financial circles more strongly to the bleed.ing wounds of
our public finanees, as opposed to the caxelessness, divisions and tomfoolery of our
political leaders~ ~:he Council's anathemas ha,ve brought the bad reputation of the
Belgian franc to a level close to crisis and have stirred up a11 the suspicions it
was the object of on the exchange maxkets. And which the National Ba.nk acknowledges.
~ Crisis Loan Evaporated ~
Indeed, it turns out that the operations to support the franc on the exchange
markets by the Institut~ of issue have once a,gain started to require the mobiliza-
tion, day after day~ of ever more abundant reserves~ notwithstanding the (temporasy)
maintenance of the efficial discount and advance rates at 13 percent.
A debt which will go from 84-.6 billion francs in 1978 to 250 billion in 1982.
2
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Thus, between the beginning of June and the first days of July, the National Bank
spent some 30 billion francs, 11 billion of which during the period of Monday, 29
June to Monday, 6 Ju~y. It was~ once again, so much wasted effort balanced by an
ir,creased depletion of the coun-try's substance.
Another possible deduction ba,sed on the data provided by the National Baa~k: already,
there is apparently not a cent left of the 78 b311ion francs of the crisis loan
_ which ended its career on 30 June:
In fa.ct, instead of erasing part of the "slate" ha.nging behind Mr Cecil de Strycke~
counter, the sta.te was forced in the beginning of the month to resort to so-called
indirect advances from the bank, to the tune of 5.5 billion francs, separate from
the help obtained from foreign lenders. Which has 1~ought the amount of these ad-
vances to 127.1 billion f~ancs~ very close now to their (elastic) ceiling of
130 billion... While waiting for the r~cevery which cannot be long coming for feax
that the gears of the money press will become jammed.
COPYRIGHT: 1981 POURQUOI PAS?
8~3
_ cso: 3100/85?
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ECONOMIC ITALY
GOVERNMENT, LABOR, MANAGEI~NT ACCORD NEEDED FOR INFLATION
= Social Contract
Milan IL SOLE-24 ORE in Italian~26 Jun~81 p 6
[Article by Carlo de Benedetti: "A Social Contract ~s the Last Beachhead"]
jText] The d~ebate within the CONFINDUSTRIA [General Confederation
of Italian Industry] leadership on the 1975 cost of living agreement.
This is the final part of the document on the cost of labor
presented to the CONFINDUSTRIA Board of Directors by Carlo
de Benedetti, vice-president and administrative delegate from
Olivetti.
(1) If business is to run a Red Oueen~s race and achieve a zero net growth. rate of
real wages (we are talking about workers' actual take~home pay), cost increases will
far outstrip inflation.
Let's take the case of a worker who was netting 700,000 lire a month at the end of
i980 at an annual employer's cost of 16.5 million lire, which is a wage about equal
to the average of t12e workers surveyed by Federmeccanica. In 1981, the worker would
have to receive (assuming inflation at 22 percent) 85U,000 lire net a month in order
to maintain his buying power at the same level. In this case, business would sus-
tain a cost of more than 21 million lire or an increase of 28 percent, not 22 percent.
Wl~at are the causes? In the first place, there is fiscal drag. To insure a 22 per-
cent net increase in wages, as in the first example, taxes alone will cause gross
wages to grow by 26 percent. In the second place, there is a progressive scale for
seniority pay. (Even under the present system, maintenance of buying power is sub-
ject tu progressive scales; in times of growing inflation, with wage indexation cov-
erage decreasing, costs are disproportionally increased.)
If the seniority pay agreement were repealed by referendum, the tax in the preceding
example would cost more than 22.5 million lire with an increase of 37 percent, as
opposed to a cost of living increase of 22 percent. Under the present system, if
the weight of the c~st of living increases is reduced but the total wage is maintained,
obviously by increasing other pay categories, the result is paradoxically an increase
in the total cost because the mechanism of progressive scales multiplies the effects.
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(2) This shows once again that the objective of containing or controlling more
effectively the cost of labor cannot be met only by revising wage indexation al~ne.
A revision of the wage indexation mechanism would be partly ineffective unless other
things were done at the same time, namely: periodic revision of the IRPEF [tax on
family income] curves, which at inflation rates over 20 percent cause inequities
for workers and weigh heavily on costs and pay scales; a revision of the seniority
pay scale, and above all elimination of the progressive mechanism. These revisions
- seem~especially necessary if the threat of repeal is to be defused for the time
being.
(3) In the last S years, business has managed to insure real wage grow~h at about
1 percent, but a high price has been paid for this achievement, While the cost
of living has grown at an average annual;rate of about 17 percent, the cost of labor
per worker has jumped by more than 19 percent. And this includes the taxation of
fringe benefits in 1977 and 1979-80. If this element is excluded, the gap between
the cost of living and the cost of labor per worker increases 5 percent! This gap
is doomed to widen dramatically in coming years unless all causes of distortion in
various labor cost components are eliminated, along with automatic mechanisms that
- multiply inflationary factors and expectations. Tampering with only one element
might ultimately cause further distortions and increase the cost of labor.
(4) Correction of the wage indexation mechanism absolutely must be accompanied by
a set of c~ordinated actions: (a) reform of disability and unemployment compensation;
(b) revision of tax and fringe benefit policy; (c) revision of the family allocation
- policy to protect family income more ade~}uately; (d) revision of the double contract
' system, both collective and individual, as regards wages; (e) implementation of ef-
fective productivity agreements, because the prablem is certainly labor costs in
themselves, but the basic objective is to contain the cost of production.
(S) Coorclinated action cannot be taken in a climate of social confrontation. No
unilateral decision can produce any result in the fight against inflation. On the
contrary, unilateral decisio:~s may threaten eventually to worsen the situation and
accelerate the inflationary spiral.
Take seniority pay, for example. If the referendum ~~ssed and the cost of living
were reset, the industrial system would face in the fii�st year 5.3 billioit lire in
higher costs, that is 7 percent more in labor costs. The subsequent implementation
of proposals similar to those advanced at the Montecatini union convention would
' cost more than 8 billion lire, with a cost increase of 10 percent.
But the mechanism of indexing is no less dangerous under the present system. The
so-called progressive feature causes very erratic variations in the cost of labor
by amplifying the effect of every wage increase that is not in line with the increase
in the cost of living.
This aspect is being especially emphasized as the 1982 contract renewal time approaches.
Revision of unemployment comnensation is therefore even more important and urgent than
revision of wage indexation, but even this is being achieved in the context of a
vaster agreement that takes into account every~i,liing, more or less, that affects
the cost of labor.
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_ The use of precise analytical instruments has shown, for example, that transforming
unemployment benefits into a kind of intexest,bearing wage savings program in place
of the outworn, unsettling dole and putting cost of living benefits back into the
current housing allotment could radically change this mecfianism first by maintaining
more effectively the real value of deferred income and, second, by blunting the ef-
fects of wage variatiion multipliers, which periodically cause sharp strains on busi-
ness costs.
Let us now see the reasons that a social contract is necessary for the fight against
inflation.
(1) It is illusory to think of combating inflation without government participation.
Most inflationary factors in Italy depend directly on what the government does, and,
in the second place, the government controls some important factors that multiply
and expand inflation.
An agreement between management and the union on some of the components of labor
costs will achieve nothing unless the government's inflationary behavior can be
halted.
It will not help especially to reduce c~st of living increase~ by a�ew points
if the government then adopts an irresponsible policy of raising public workers'
wages, or gives in to blackmail by public employees' unions, or fails to control
- the State Participations budgets and uncritically increases the deficit, or loses
_ control of the very size of public expenditures and the public deficit.
(2} To slow inflation and to keep from passing South-American type levels of "no
return," the only feasible way is to seat government, management and the unions
around a table and to draw up as soon as possible a joint effort against inflation.
It would be a pact in which all would pledge themselves to prolonged, no holds barred
action to halt everything that causes inflation in Italy and infinitely multiplies
imported inflation.
It will not suffice to tax wage indexation for imported inflation, as some propose;
it is necessary to make cuts, not only on wage indexation but especially on the much
more serious inflation "produced" by public administration and state participation.
Inefficient, costly corporations and parasitical structures "produce" and transfer
this inflation throughout the system.
In conclusion, it is necessary to consider objectively the decision to denounce the
_ aareement on wage indexation. Unless this act is intended to denounce and call into
question the entire structure of labor costs and the inflationaxy mechanisms connected
with it, the denunciation is a willful, useless act and probably a fur-cher cause of
worsening labor costs and inflation. It al~so accentuates the rigidifying of positions,
which can only block or at least postpone for months the launching of a review process
that cannot wait any longer.
The denunciation of the agreement on wage indexation may yet have a meaning, but only
if it is a part (and nothing more) of a general action inviting the union and govern-
ment to review jointly the factors that cause inflation and make it intolerable for
businesses to operate in this cont~xt.
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A unilateral denunciation of a single component can only elicit further unilstera.l
denunciations: the request to abrogate the agreement on seniority pay clearly demon-
strates this.
But no steps forward are being taken, only backwards. The risk is that no one will
come out a winner and everyone witl be a lncPr to uncontrolled inflation. The problem
is too complex,an~ the unions and business cannot solve it alone without taking joint
action. They and the g~vernment should be immediately invited to a round table dis-
cussion, where they may make concrete proposals and not just sterile affirmations of
principle.
Wage Indexation: Another Look
Milan IL SOLE-24 ORE in Italian 26 Jun 81 p 6
[Article by Giancarlo Lorr~bardi: "Denouncing the Agreeme~t IS Not an Act of War"]
[Tex.t] We must quickly clear the field of the emotional tension that the press has
echoed in recent days concerning the debate on wage indexation and the cost of labor.
- If husinessmen denounce the agreement, the country will not be in any more danger
than it already is. Nor is it truz that business's "guilty" choices would cause
growing tensions and vitiate civilized befiavior, because tension and the threat to
public order result not from industrial relations but many other, more serious ills
in our ruling class, from the lack of governmental authority, the lack of legitimacy
_ in the policy-making class, the lack of moral leadership and the lack of renewal.
It is a specious argument to claim that denouncing the agreement might be an 1ct
"against" the new government, because the problems that Senator Spadolini will have
to face are of such a nature that a general strike cannot ease or worsen the emer-
gency that has been talked about for years and that has liecorr,e the basis of the
incumbent president's pro~ram.
- If we think about it coolly, the chance to renegotiate the social contract might be
a new card for the new government to play, and the role of inediator between the parties
might leave more room for the new government coalition to reach a solution that would
not favor one party more than another but would be truly the best for the "common
good."
The general interest and common sense require that the mechanism of cost of living
allowances be overhauled but, obviously, without reprisals or the uncertainty that
would arise from a dangerous vacuum, a state of widespread anxiety, and real or
presumed threats. The task of the ruling class should therefore be to take this
step in an enlightened, responsible manner; otherwise the debate will be fruitless
and will wear itself out in a battle ~ver highly ideologized principles.
And, to my profound disillusionment, this is precisely what is happen~:ng. It deserves
some consideration.
It is useless to waste too many words on the insensitive arguments of at least some
unionists: in recent months, union leaders have acted in confusion and virtually in
conflict, so that it lias been hard to see any definite policy emerging concerning
cost of living benefits, and it has been even less possible to fin~: a unified posi-
tion being taken on the other side. Political forces have certainly not shown any
clear direction or program. ,
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As for the government, the events of recent months have practically put it out of
action on this issue, and we are dealing with political management that is obliged
to resort to survival tactics from day to day rather than formulate policy. The
action cc.~ be taken concerning the nation and the economic ~ystem has remained a pro-
mise of the Forlani government ratfier than policy, and tfie 3-year plan is still a
statement of intent that may be shelved,
Why then be surprised that in this climate of rarefied responsibility businessmen
should respond to the demands and experience of their profession and call public
opinion to bear on one of the problems, albeit neither the first nor the last, of
our economic and social system?
Wliy shotild one part of society, simply because of its role in the national economy,
be charged with responsibilities that impede its function and exceed its competence?
The issue of the denunciation of the agreement as it has been presented to public
opinion in an authoritative manner has, in my opinion, been poorly presented.
Things are not as they appear or as some wish to make them appear. The action
that business has taken is not "against" anything, nor is it an act of war (on
whom? Why?); it is not an irresponsible act but one taken out of concrete neces-
sity to launch a dialogue and negotiation that I sincerely believe will be in every-
body's interest. Indeed, nowhere is it written that a revision of the present system
of indexation, taken in the overall context of negotiations, should necessarily lead
to punitive measures against wages.
I have some authority to say this because of my position in the.organization to which
I belong, Federtessile, which was among the first to pose the problem of the urgent
necessity to modify the present system of automatic wage indexation. It is worth
~ recalling that Federtessile posed the issue to CONFINDUSTRIA and then to the public
in a very different way from that in which it has taken shape in commercial circles.
Our objective was to reach an early agreement with the unions, one that would meet
the main problem facing our country, namely inflation, and to coordinate the contri-
butions that the various parts of society would make toward solving it.
Room was also to be made within these negotiations for the issues raised by the union
at Montecatini and the problems of Italian industrial competitiveness, which have
often been brought up by management.
Negotiations with the unions have not begun, not only by their fault but also because
CUNFINDUSTRIA turned all its attention to the tactic of making a demand that could t
be risky but that they might get anyway; if it were rejected, the rejection would
incur responsibility for worsening the situation.
Thus the issue as it s~.ands today: yes or no on wage indexation. This is simplistic
and unacceptable considering the issues at stake.
Wage indexation is not the main cause of inflation, nor is it the most serious problem
for competitiveness in Italian industry. The quantity and qual~ty of public spending,
the lack of a true industrial policy, and the consistency of currency exchange are
much more serious issues.
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(3ut thc cost of labor and productivity are real and important problems, They must
be met realistically and innovatively, Solving them rec{uires the action of the
unions, business and the government,
~Ve are now ready to begin negotiations witfiout arrogance ar ulterior motives.
Could this not also lead somehow to rebuilding the morale of tlie country?
COPYRIGHT: 1981 Editrice I1 Sole-24 Ore s.r.l.
8782 ~
1:S0: 3104/319
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ECONOMIC ITALY
SPADOLINI ANNOUNCES ECONOMIC POLICY, CRITICS ATTACK 2T
Synopsis of Economic Policy
Milan IL SOLE-24 ORE in Italian 1 Jul 81 p 5
, [Text] Here is a summary of the economic portion of the policy
- ' agreements for the new cabinet, taken from the report
by Prime Minister-designate Giovanni Spadolini, with
the approval of the member parties of the new majority.
The current state of the economy has given rise to serious concern. at
the synergistic effects of rising inflat.ion, our deteriorating forkign
- exchange positiorl, and the ever-growing State defic�~t.
Th~ strong recovery of the dollar h~s added further alarming inflation-
ary pressures, with very serious reper~cussions on the balance of pay-
ments deficit.
Prices are rising at a rate of 20 percent per year, while the negative
impact of the devaluation of the lira vis-a-vis the dollar has yet to
be fully felt; it is fair to assume that the first impact of the de-
cline in the exchange rat~ on inflation in 1981 will certainly amount
to 6 percentage points.
The current deficit in the balance of payments, estimated for 1981 at
3 trillion lire, is greatly worsened. Not only did the overall cur-
rency balance for the first 4 months show a 3.$-trillion lire deficit,
with the trade deficit verging on 6 trillion; in May alone the trade
deficit hit 2.03~ trillion, bringing the overall figure up to 7.7
trillion. Reserves over the same period dwindled by a staggering $5�5
billion.
Employment levels have yet to feel the direct consequences of a situa-
tion which, no matter how you look at it, calls for unified economic
policy guidelines. The ranks of the unemployed tend to grow by reason
of failure to absorb the rising tide of new entrants into the labor
force (estimates show that unemployment rose by O.o points in 1980;
1981 forecasts say it will ri se another 0.3 points, and the Income
Supplement Fund in the first quarter of 1981 rose by 138 percent over
the same quarter in 1980.
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Forecasts for total real investments in 1981 call for a slight d:cline
0.4 percent), accentuated in the industrial sector 3�5 perceni;).
Furthermore, even investments in the Mezzogiorno seem to point to a
relai;ive slackening, despite increased expenditures there as emergency
aid to the eartr.quake-stricken areas.
~ Against such a background, the slight (0.3 percent) rise in the national
income for the first quarter looks far more like a reflection of the
endemic inf lationary thrusts than like the fruit of economic policy.
What is causing genuine anxiety, though, is the swelling ~;ide of red ink
in the public sector; in the first 5 months of this year the require-
ments of the State sector reache3 the astronomical figure of 22 tril-
lion lire, twice what they were for the same period in 1980.
Even allowing for the effect of the cutbacks recently proposed in Parlia-
ment, the experts calculate that, before the year is out, that figure
will top the 3~.$ tsillion the Forlani government used, for the simple
reason that you cannot get the State's books back in balance by cutting
back or delaying investment expenditures: those are figures totally
incompatible with any serious policy for fighting inflation.
i
Monetary policies in the.Ux~ited States and in the major European coun- ~
tries will show no signs in 1981 that would provide grounds for hopes ~
o� ar.y letup in international pressure on the lira. ~
, `Needed: A Pact To Fight Inf lation
The time remaining to mount one last effort to implement a policy that
is not merely and drastically one of draconian cutbacks, one that stands
by the growth potential called for under the 3-year plan, is swiftly
running out; it is, however, the duty of the government and of the po-
litical parties that support it to make every effort to restore invest-
ments and employment through an extremely tough preliminary move, via
immediate policies and action designed to allow for recovery of the
preconditions for a strategy which, as it cushions the impact of infla-
tion, wi11 still keep alive the nation's development potential, partly
through a gradual loosening of the stif ling noose of the balance of
payments.
Only an approach combining extreme firmness and absolute rigor wi11 en-
able the government to keep its pledge to push ahead with the medium-
term plan now before the Senate.
Achieving a coherent structure embracing the public budget, monetary
expansion, and international conditions which will not have a profoundly
untoward effect on employment and Mezzogiorno development presumes an
active role for Parliament and the labor unions, designed to clamp down
on waste, mismanagement, parasitism and sinecures not to mention
cutting back sharply on the current levels of government spending
and to encourage protection for directly productive incomes and for
the investments essential to the future of the national community.
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- It is therefore essential that the labor unions pledge their contribu-
tion to the fight against inflation, so as to take care that policies
designed to slow price rises do not fall too heavily on employment and
development in the Mezzogiorno.
There is no dodging the gravity of an economic situation that demands
harsh and fateful decisions. The primary commitment, the one that
will govern the outcome of whatever else is done, is still that of
forciiig the national budget back within the confines mapped out in the
3-year Plan through whatever measures are requisite.
This will mean cutting back the total internal requirement to 37�S
trillion, by means of action to remove the deficits in the sectors of
health, welfare, income transfers, and education. It is absolutely
not advisable to put the nation's books back in balance by means of
cutbacks or postponement in capital expenditures vit;al to the develop-
- ment of the Mezzogiorno; any such cuts or postponement would simply
pop uF again as an unwelcome burden on the 1982 budget. These mea-
sures are of course understood to be supplementary to the provisions
made by the Forlani government and now pending in Parliament.
The new government wil~ have to negotiate with the unions over their
contribution to the fight against inflation, by means of setting an
agreed=upon rate of inflation as a ce~ling fie~ow which the several
contract variables will be held,including controlled prices, rates,
and labor costs; within this framework they can examine the matter
of cooling down the indexation machinery.
Even so, owing to the extreme difficulty of the situation and to the
time such operations must take, it will be necessary to maintain mone-
tary conditions such as to allow protection of the currency and mone-
tary stability. This way we can ward off an even graver monetary and
inflationary crxsis, massive enough to postpone for many years any
prospect of expanding our productive base or our production, to say
nothing of economic recoverv for the Mezzogiorno. Any relaxation in
such policies could come about only in response to substantial improve-
ment in the overall economic picture. Particular attention must be
- paid to credit conditions for small and medium businesses.
The 3-Year Plan
The new government shows that it sees a close interconnection between
the goals of steadily reducing inflation and uf support for the higher
investment levels designed to increase employment and to narrow the gap
between the North and the Mezzogiorno, in accordance with the policies
- and on the scale of magnitude set forth in the 3-year plan and in its
enabling legislation.
Vitally needed is a grand design for planning ce_^_��e:::d on those invest-
ments which will make the Italian economy less dependent on imports,
without narrowing our openness to the world outside, but aimed at get-
ting the various parts of the country to buy products from each other.
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Given ttiis approach, we could pursue the basic goal of prQtecting jobs
in terms of productivity, rather than welfareism. Rigorous standards
for management must be imposed upon those productive sectors depend.ent
upon the public budget, and there must also be a comprehensive plan for
encouraging research and technological development, and expansion in
the vanguard industries which clearly are feeling less competitive pres-
sure from the developing countries. To achieve this, the plan calls
for turning to the international money market for financing eventually,
but only when conditions include a stable currency and when an over~ll
picture reflects an economic policy closely adherent to international
trends.
_ The first commitment under this guideline will be introduction of the
finance bill at the end of September; that bill will set the ~eneral
tone for 198L .
Debate on the bill will provide the opening f or a first step toward
that line-by-line scrutiny and resetting of priorities in public spend-
ing called for under the 3-year vlan. Specifically, it will necessi-
tate strict interpretation of the new accounting law (article comma
8 of PL 468), to ascertain that there is no possibility of any increase
in current deficits a safeguard written in to block any spending not
actually covered (by new revenues or reduced expenditures) and ap-
plicable to the finance law itself.
In view of the foregoing, it will be necessary to write the spending
ceiling into article 1 of the finance bill itself, so that any changes
in spending effected in the course of debate in Parliament must stay
under that ceiling; to get on with rapid stabilization of public spend-
ing it will also be necessary to alter the law on local and regional
finances so as to reduce sharply the level of transfers of national re-
venues, with provision of some autonomy in tax decisions for local
governments; ta pu~ at least a 1-year freeze on health-connected spend-
ing in relation to the expected rate of inflation through cutbacks in
coverage for small (pharmaceutical and clinical) risks, except for the
lowest income groups, and moving ahead on streamlining management.
Measures will also be introduced to standardize management procedures
in the independent social security agencies (INPS). ~
Economic policy for the short run will be one for paring the public bud-~
get down to the dimensions set forth in the integrative note submitted
to the Senate, and for currency expansion to the levels required for
the stability of our foreign exchange and to slow the decline in will-
ingness to hold currency: the one true guarantee of effectiveness and
of adequate backing for the fight against inflation, which today threat-
ens to overwhelm the country.
Regular Surveys of the Economic Situation
The emergency nature of the present phase demands unremitting atten-
tion to the conduct of the war on inflation, as well as to the over-
all economy. There must be machinery for periodic checks on vital signs.
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13y so doing, wc~ shall achieve constant visibility for whatever aci;ion
government may take, as we grasp it and follow it as a whole in rela-
tion to the shifts taking place among the various controlling factors
in the econom3~. To this end the new government must undertake an eco-
nomic survey and present its findings in a report every 6 months; this
will give us all a chance to get a critical look at the overall situa-
tion, and to rr.~ke our own assessment of the policies pursued and of
th~~ behavior of all three responsible parties: governr.?ent, labor, and
management.
The Dollar-EMS Link
In these times it is vital to push on with a restoration of sound
health to the nation~s overall economic situation, ar~3 tn~ith a sharp re-
duction of the inflationary gap between Ita1y and the other European
countries. This troublesome stat~ of affairs is partly a reflection
of the obstacles encountered in our pursuit of the Community-wide stan-
dard policy for which Italy has fought since the outset.
The new government will have to busy itself in f indin�g ways to maintain
and strengthen the internal cohesion of EMS-member currencies. In this
context, it becomes not only legitimate, but obligatory to establish
a common policy for all European countries vi.~-a-vis the United States,
through a possible concerted initiative by the Community nations. It
would be a~ood idea to urge the United States to adopt a monetary po-
, licy that does not place an additional burden on the already difficult
position of the European nations, and one that does not wind up merely
"exporting inflation," which is what is actually happening now. (We
shall have more to say on this topic in the last section.)
There will also be provisions to bring our currency laws into line with
EEC standards in matters of international capital operations, so as to
arrive at a suitable liberalization of current regulations.
~
Labor Mobility and a kevival of Professionalism
Get+ing our productive system back into healthy shape and recovering �
its competitive stance in the international field, through processes
o~ plant and corporate reconversion and restructuring, will require
the availability of new tools, some of which must be designed and put
in place by legislation, that will make it possible to lay the founda-
tions f or real mobility, in-huuse and inter-corporation, for the work
force.
Equally important are measures to upgrade professional attitudes and
commitment to the job, as well as more flexible patterns of employ-
ment designed to satisfy the growing demand for both in the market,
either openly or in terms of unreported employment in the underground
economy.
Along with these prescriptions, the new government will have to
pledge itself:
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to act to encourage the swift and final approval of the pending bi:11
on hiring and placement reform, labor mobility, and the wage supplement
fund , all of them giving proper attention to the individual appli~a-
~ tion rolls of young people seeking employment in small and medium busi-
nesses and in the crafts, and to a reintroduction, among the criteria
for selecting workers for "mobility" status, of "the companyt s tech-
nic al and productive requirements";
to adopt measures aimed at upgrading occupational status and skills,
beginning with legal recognition of intermediate cadres through modi-
ficat ions in article 2095 of the Civil Code;
~o encourage institutional definition of more flexible patterns of em-
ployment, with particular emphasis on part-time work, as an i.nterim
step pending regulation and the restoration of order among the mani-
fold forms of "moonlight" or "underground" employment.
As a part of government policy to protect and expand employment, new
steps will be taken in the field of orientation and training for the
yourig and for workers on mobility status, and every encouragement will
be lent to an adequate system for correlating educational achievement,
vocat ional training, and the labor market.
Industrial Policy
Industrial policy must continue, in line with implementation of the me-
dium-term plan, to hPal the trouble-spots so as to stanch the ineffi-
cient use of resources, and to develop the supply of high-tech products,
modern services, infrastructures, and opportunities.
Fitting neatly into this picture is the creation in the Mezzogiorno of
conditions conducive to the consolidation and replication of the recent
heat.t hier and more orderly industrialization of certain southern areas,
and to attracting foreign inves~ment.
Special encouragement and incentive should be provided for expansion of
the components and electronics industries, and of telecommunications and
_ dat a-processing services.
During the current emergency, the new government must push on with the
work of restoring economic, industrial, and financial health to the
steel, chemical, and aluminum industries, taking a.multinational ap-
proach to the problem.
It must also move expeditiously to push the already launched program of
support for technological research, from which small and medium compa-
nies, on their own or in consortia, must be made eligible to profit as
well.
A bill will be introduced shortly to rF;place PL 675� Its objective will
be to streamline procedures, to place more responsibility on businesses,
to divorce tax concessions and credit relief from sector-wide plans,
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arid to establish conditions that will guarantee an adequate flow of
financing to small and medium businesses and their consortia.
~ndustrial policy will turn on improvements in the utilization of pro-
duction f actors rather than on sector plans. Sector plans will still
have to be formulated and utilized for more general purposes under the
3-year plan.
- Energy Policy
The new government must deal with the energy problem decisively and on
a top-priority basis. That will take a broadly comprehensive program
that will enable us to make up for lost time.
The decision to pick up the nuclear optien is an urgent one, in this
context, and must be implemented without delay. Decisior~s on plants
and sites will be made by the executive branch, within the scope of
its responsibilities, within a very short time. Site selection will
be accompanied by the adoption of the best available security measures
and by the most appropriate forms of compensation once sites have been
selected. In this context, the government is committed to give the
green light to at least four thermonuclear pl::~its.
A realistic policy for coal will be formulated at once, based on prac-
tical feasibility, and an immediate start will be made on the vitally
needed inf rastructures, while putting an end to the persistent penaliz-
ation of coal as opposed to fuel oil.
Methane deliveries from Algeria will be channeled to the Mezzogiorno
on a preferential basis.
As for renewable energy sources, alternative energies, and energy sav-
ings, proposals will be presented for various kinds of incentives, and
full backing will be given to pertinent legislation now pending in
Parliament.
Far1y th.is summer the national energy plan (PEN) will be promulgated;
it will be the reference document for all the nation~s energy policy,
along with the kindred decisions on industrial, housing, agricultural,
foreign, and fiscal policy. ~
At the heart of our energy policy will be a determination to go ahead
with restoring balance to imported energy sources in relation to the
areas and patterns of acquisition of such energy, with a'view to the
greatest possible improvement in our country's security and indepen-
dence. ~
State Participation Policy
The prime requisite in this sector is sti11 a restoration of efficiency
_ to strike at the root of uneconomic management, which has thus far ham-
pered new investments or rendered them very costly, even when they in-
volved simple technological updating, and has eventually led to the ob-
solescence of plants and the destruction of jobs.
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The era of rescue operations mu~t come to a final end, since publicly
owncd indust,ry t?as demonst:raLc~d its incapacity to handle them and
~ince thc:ir economic and social cost has turned out to be excessively
onerous when balanced against the few advantages in terms of the jobs,
o�ten only temporary, they managed to provide.
Funding must be arranged speedily for the three management agencies
in connection with the updated reform programs, eliminating the chronic
malaise diagnosed by the b:icameral commission.
- The go~-ernment will take pains to see that the agencies pursue adequate
policies in the areas of internationalization,investments, recourse to
the money market, technological updating, and non-energy-intensive
production.
New measures for better definition of government guidelines and for
management supervision, management policy measures, definition of the
autonomy and responsibilities of individual managers, and budget au-
dits will be submitted by the new government very soon.
A detailed and specific analysis by sector and by geographical areas
of agency activities, coupled with an assessment of their profitability,
will provide a basis for forming sotuzd judgments and for carefully
weighed and considered allocation of funds, and for deciding what can
safely be returned to the discipline of the private sector and the mar-
ket .
In cases of return to the private sector, there will be prior inquiry
into the reliability of the principals, the existence of an investment
program; and of the conditions for economic recovery and for sound
management.
This commitment should tend toward better health, toward a recovery of
domestic and international market shares, toward technological moderni-
zation, and toward a fresh start and new growth in the sectors whose
trade deficits are moving toward unaccepta.ble levels despite the enor-
mous investments poured into them over recent years. No less a com- ,
mitment will be made to the recovery o� the equally vital sector of
- Italian telecommunications, now in deep trouble.
Final Portion of Program
Milan IL SOLE-24 ORE in Italian 1 Jul 81 p 5
[Text] Here is the final portion of the new government's eco-
nomic program. The main body of our report appeared in
yesterday~s edition of IL SOLE-24 ORE.
Mezzogior�no and Earthquake Zone Policy
The Mezzogiorno today presents a picture of a regi.on racked by tensions,
but one where those tensions run side by side with phenomenal vitality
in agriculture and industry alike, particularly among sma11 and medium
businesses: there has been noth.~ng like it before. At the same time,
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There must be some sort of intervention to hold down spendi_ng by local
governments in sectors other than housing construction and city plan-
ning, with a consequent increase in funds earmarked for these purposes.
Communes must find more funds for housing for the homeless.
To make the housing policy work, in addition to measures to support real
estate loans, there will be a bill establishing a home savings system:
the bill will issue real estate certificates to raise funds which will
then be earmarked exclusively for housing construction.
- As for city planning, the costs of housing tract concessions will be
reduced and made standard for the whole country. Solutions will be
sought to the problem of standards for setting compensation rates for
condemnation proceedings.
Standards for increases on rent-controlled housing will have to be cla-
rified. There will have ta be some rationalization of the assistance
fund established under PL 39'L� Care must be taken to protect landlord
rights to recovery of availability of housing premises. As for public
housing construction, there is hope for speedy debate on the plan to
revamp the Public Housing Authority (IACP) or for redemption of houses
on which mortgages have been foreclosed.
Special attention must be given to the pr~oblem of land reclamation, in
coordination with th~e bills for that purpose already before Parliament.
Credit Policy
Improvin~ the efficiency of our credit system is one of the key elements
in powering the tools of economic policy and for the orderly functioning
of the entire economic system.
To this end the government believes it vital to move as swiftly as pos _
sible toward effective equaliza~ion of loan conditions between public
and private banks, in line wit}i EEC guidelines.
Farm Policy
The car~dinal aim of agricultur~l policy, under the guidelines laid down
for the medium term by the Plan, will be to reduce the shortage of
Farm and food products. This will involve adoption of ineasures designed
to:
get exports of f arm and food products back to healthy levels and review
import quotas for the various countries so as to avoid privilege or un _
f air discrimination;
develop the most laggard areas of farm production through encouragement
and support for programs specifically tailored to modernize and recon-
vert production and to expand the supply management organization. With
this as its working structure, the government pledges swift approval of
measures calling for further appropriations for agriculture, embodied
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ttic: aricicnL di.sp~iritics be~ween one Southland region and another have
becn grcatly exacerbated, and a whole new set of complex and difficult
- urban problems is beginning to surface.
While all this is happening, the Mezzogiorno stands on the threshold bf
a new era in its history: along with the new phenomenon of internal
di~ferentiation, there is a fundamental change afoot in its relations
with the rest of the nation and with the international economy.
Two guidelines for action thus become essential, and we must move along
those lines:
a. reassert our commitment to industrialization, improvement of ser-
vices, and support for Southland agriculture along the lines of Euro-
pean integration;
- b. closer attPntion to the internal differences in the Mezzogiorno and
to the new realitias there, for better and for worse, so as to tailor
overall action in support of Southland development to those realities.
_ These requirements can be dealt with through timely approval embody-
ing suitable modif ications Parliament may see fit to make of the
extraordinary intervention bill introduced by the Forlani government.
There will be a profusion of special commitments to the quake-stricken
areas; approval of the aid bill for these areas provides a working
tool. Th~e new government will have to keep an eagle eye on aid deli-
very, and submit regular reports on p~~ogress, as well as propose what-
ever direct intervention seems advisable.
The whole idea of this is to monitor progress in the following: the
process of housing adjustments, restoration of urban areas (particu-
larly in and ar~und Naples), reconstruction in the hardest-hit areas.
provision of municipal services, particularly water and sewers, region-
al government action to foster industrial recovery, and coordination
amon~ the programs of the various institutions active in the area.
Housing Policy
The ~overnment intends to respond to the extremely grave situati~n in
the housing industry when it presents a set of all-encompassing stand-
ards designed to expand the sector, with special attention to tax and
credit regulations, streamlining procedures, pre-planning and availa-
bility of sites and, above all, a definitive recasting of materials
standards.
For the moment, the government is hoping for expeditious debate and
passage of the housing construction recovery bi~.l now before Parliament
which calls for additional funding for PL 457 (th~ ~G-year Plan) and
PL 25, and for establishment of a fund for purchase and urbanization of
selected sites, with special emphasi~s on the larger communes; for which
coverage must be guaranteed in real terms.
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in the proposed PL 140~, alreadyapproved by the standing committee in
- the Chamber of Deputies;
salvage and restore the inland areas, and encouraging investments tA
that end to foster productive land use suitable to the nature of those
areas.
In the work of amending and updating Community agricultural policy, the
government following the guidelines already laid down in Parliament
will keep firmly in mind the need to expand Italy~s farm production
and will, furthermore, closely scrutinize the conditions set for expand-
ing the Community to admit Spain and Portugal.
Lastly, there will be a swift wrapup of Parliament's debate and approval
of the farm credit reform bill, with due consideration of the National
Economy and Labor Council (CNEL) guidelines in the matter.
Implementation of the National Health Service
All predictions for health spending have, practically speaking, gone by
the boards, The ceiling set on it have long since been exceeded. In
the course of 1981 it is certain that spending will go f ar beyond the
appropriations set down in the budget.
The deadlines for implementation have also expired. Investigators are
still reporting shocking waste, grossly swollen bureaucracies, and
practical difficulties in meeting the demands of protecting the nation~s
health, thus giving rise to a national health service shamefully f ar
below the civil requirements of the nation. As a result we face a si-
tuation in which we must, at one and the same time, cut down on waste
and steadily upgrade the efficiency of the service. What this amounts
to is getting the National Health Service fully implemented, and conse-
quently stepping in with adequate measures to control the amount ancl
channels of spending, so as to halt the processes that produce these
mounting deficits.
At the same time, all expansion in support structures must be halted, so
~,s to insure the efficiency and excellence in delivery of services that
were the reasons for establishing the National Health Service in the
f irst place, as part of a view of social security indisper.sable to our
hopes for an advanced democratic society.
COPYRIGHT: 198o Editrice I1 Sole-24 Ore s.r�1.
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Centro Europa Criticizes Plan
Rome L'ESPRE SSO in Italian 5 Jul 81 pp 151-153
[Article by Antonello Talamanca: "This Plan Sounds Some Sour Notes"]
[Text] Spadolini's economic policy is based on Giorgio La Malfa's
3-year plan. But is it ~rorth the trouble? Centra Europa says
that it is a mistake: the plan is wrong and it is of little use.
Rome. Is Giovanni Spadolini doing the right thing in basing the new administration's
economic policy on the 3-yea.r plan drafted 6 months ago by Giorgio La Malfa? This
is a question which many people are asking themselves during these final days of
the negotiations over the new cabinet. That include espec3.ally those who, at
the time, expressed some uncertainties, if not harsh criticisms, on the La Malfa
plan. In addition to the Bank of Italy, which had expressed doubt as to the
iuentification of the plan's macroeconomic framework, economists of t~he stature
of Luigi Spaventa and Lucio Izzo proved to be confused, if not disconcerted.
Centro Europa has therefore decided to put under the electron microscope something
that seems to be destined to become the "word'' in economic policy over the next
several years: it has subjected the plan to a complete check. And the first
results are much more discomforting than one might have expected. Becguse of
its contradictions, because of its lack of coherence, because of the vagueness of
_ some indica tions and above all because the instruments pravided for it do not
permit the attainment of the predetermined goals, the plan simply does not work.
The workers and researchers at Centro Europa agreed that the plan was not right
even before it was drafted; this is something that is more unique than rare in
documents of this type and there is no indication as to any trend in the develop-
ment of the economy, nor in the effects of the action proposed. Now Centro Europa
~ itself has been forced to work the whole thing up f rom the beginning. And here
are the results.
The proposed main line of the La Malfa plan is to pursue a vast investment program.
In particular, the plan was to make it possible to increase public spending
through investments of almost 16 trillion in 3 years, to be made up through an
equal reduction in the current public deficit. This amounts to cuts of more than
47 trillion; together with greater spending for investments, as a matter of fact,
the plan also calls for a reduction of about 31 trillion in the anticipated revenues.
This Is No Way To Beat Inflation
What are the effects of this maneuver on the economy? From the viewpoint of holding
inflation down, the effect is almost nothing. While the development trend makes
us think in ternis of a consumer price rise of 55.5 percent over 3 years, prices
would go up 54.5 percent with the plan, in other words, with a reduction of one
percentage point in 3 years. The same can be said for employment. As a matter
of tendency, new jobs, which would be created over a period of 3 years, would
amount to about 430,000 while the plan could bring that figure up to 500,000; in
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other words, only 70,000 jobs more. The effect on economic growth is also a little
more than zero. The real domestic product should go up 4 percent in 3 years and
if the plan is implemented, it would go up 5 percent, in other words, only 1 percent
more. These modest results would furthermore be obtained by smashing those very
same "restrictions" which are recognized by the plan. First of a11, the restric-
tion represented by payments going abroad: the balance of trade would decline
by 14 trillion in 3 years. But fixed investments, to b e sure, are destined to
go up 23 percent against an increase trend of only 9.5 percent. In other words,
the only well-defined maneuver in the plan (the balance policy) looks inadequate
right away when it cames to attaining the "medium-term objectives" in the five
macroeconomic magnitudes indicated by the plan itself: real growth, inflation,
employment, current bottom line in balance of payments, and development of the South.
This Is Not a Realistic Blueprint
But even if th e results were better, there is some doubt as to the real feasibility
of this balancing act. The plan talks in general terms about cuts in current public
spending. What kind of cuts? Righ t now, two-thirds of current public spending
are earmarked for earnings and retirement pay while half of the remaining portion
is destined for the payment of interest on the pub.lic debt (to a great extent BOT
[Treatury Bills]), with the rest going for the procurement of goods and services.
This, to say the least, is a tough maneuver. It suffices here to make some
- calculations. If, to give the reader an example, a cut were to be made in retire-
ment pay, we would have to assinne a real reduction of retirement pay by 30 percent
while the current trend points toward an increase of 18 percent (still within the
entire 3-year term). If, on the other hand, the action were taken on public
earnings (but the plan seems to say precisely the contrary when it talks of
reclassifying public employment) the reduction would still be 30 percent in real
terms, against an expected increase trend of 12 percent. How can one reconcile
this maneuver with the assertion, contained in the plan, regardinig the increase
in public earnings to move ~hem closer to those of the private sector, increasing
pensions of publ ic employees, and improving family allowances.
But the heavy reduction in revenues also looks unrealistic. Reducing revenues
by almost 31 trillion would mean not wiping out the entire "fiscal drag" (the
more than proporti~nal increase in the revenues due to inflation) but would also
in fact transform all direct taxation from a progressive system to a proportional
system. Furth ermore, the relief would be even greater, gradually, as we implement
_ an effective policy of going after tax evaders which obv3ously could yield new
revenues.
But apart from the "accounting" problems in reconcil.ing the various demands for
spending and revenues stated in the plan, there are also problems of effective
f easibility. Is a speedup in public investments possible in concrete terms?
The sector plans in the La Malfa document (disavowed, by the way, by the minister
of the budget and defined as autonomous contributions of the individual ministries)
do not take into account the effective spending and implementation capaciti~s of
the government agencies. Normally, between the moment when expenditure i5
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authorized and the moment the r~oney is actually spent, we have an interval
averaging 2 or 3,years. And the expenditures proposed in the plan are those
whose authorization still appears far off in the future; we would thus have
to wait 4, 5, or perhaps even more years. In the meant3.me, everything remaine
what it was.
Plan's Budget Policy
(In Thousands of B illions)
1981-1983
Spontaneous tendencies La Malfa DiffPrences
(Centro Europa Plan (B) (C) _ (A)-(B)
estimates( (A)
. 1. Current revenues 641.9 611.2 -30.7
2. Current expenditures 695.2 647,7 -47.5
3. Current gap (1-2) -53.3 -36.6 +16.7
4. Investments 78.3 94.1 +15.8
And Its Effects on the Economy
(Percentage Variation Over 3 Years in Val ues at Constant Prices)
1981-1983
Spontaneous tendencies La Malfa Differences
(Centro Europa Plan
estimates)
Gross domestic product +4 + 5 + 1
Private consumption +2 + 1 - 1
Gross fixed [capital]
investments +9.5 +23 +13.5
"Goods and ser~ices" balance* -44.000 -58,000 -14.000
Consumer prices +55.5 +54,5 - 1
Total employment** +430 +500 +70
* Billions of lire
Thousands of units
The first column in both tables shows th e spontaneous trends in the Italian economy
right now. The second column on the other hand shows what the effect of the 3-year
plan of Giorgio La Malfa would be on those same variables if it were to be
implemented.
COPYRIGHT: 1980 Editrice Il Sole-24 Ore s.r.l.
50 58
CSO: 3104/331
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POLITICAL FRANCE
SOURCES, RESULTS OF CGT-PCF FRICTION VIEWED
Paxis LE NOWII, OBSERVATEUR in French 4 Jul 81 pp 28-29
[Article by C.-F. Julien: "CGT: The Plan of the Tough"]
[Text] Officially, the claws have bezn pulled in. But the
leaders axe sharpening theirs.
The CGT [General Confederation of Labor] is making somewha.t ~everish pr~parations
for the special meeting of the National Confederation Committee [CCN~ to be held on
7 and 8 July. Officially, a11 is calm at 213 rue de La Fayette: after all, is not
the CGT, as Georges Seguy put it, "or~e of the components of the ma,jority?"
Appeaxances are deceptive as the about-faces made by the lead.ers of the CGT who
suddenly rallied to Francois Mitterrand, then to the Mauroy government, following
the appointment of four communist ministers did not disarm inter.nal opposition.
On the contrary. The "oppositionists" or the "unitarians," as they like to refer
to themselves, do not accept these reversals, both for political reasons and for
reasons of credibility.
The political reasons are rather obvious. The "unitarians" apparently do not want
the CGT to become the drive shaft of the new government, but they want the major
F`rench labor group to a11ow the Mauroy administration to effect the change. And
they have a few doubts. To put it plairil.y, the CGT ha.s never been as closely tied
to the PCF [French Communist Paxty] as it is today. And in this respect, the "oppo-
sitionists" seem very close to Edmond Maire's analysis: the PCF ha,s two irons in
the fire. The PCF is in the government by necessi~iy: thus, it is the CGT which
will have to become temporarily +.he spearhead of the working class. The PCF press
will grant it more space and very soon, the group at the rue de La Fayette ~rlll ha.ve
to issue challenges which might one da,y strain relations with the government.
"Anyway," one militant commented, "even if the pessimistic scenaxio were to be re-
tained, developments ?~rlll be slow. The first skirmishes will take place at the
start of the new term; then, we Frl.ll have to wait for the Communist Paxty congress
in Februaxy, followed by the 41st congress of the CGT in June 1982. At that time,
strategies will have been redefined and roles redistributed."
A Machiavellian vision? Perhaps. But for the "oppositioi,is~LS~� things are clear:
in spite of appeasances, the CGT leadership remains on the line defined in the
summer of 1977 at the time of the assessment of the "Common Program" by the PCF
and in fact, the "tough ones", Henri Krasucki and Michel Waxcholak, ha,ve already
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taken hold of the apparatus a.gain~ while Georges Seguy remains at the secretaxiat
general to reassure the various partners.
But the "Stalinists" may well be miscalculating the facts of the new situation. In
the enterprises, the workers do not feel like launching themselves into an a,dveri-
ture to help the PCF regain its electorate. Moreover, the "teugh ones" are under-
estimating the consequences of the internal crisis of the Commtmist Party on the
CGT, and the trauma among the militants caused by the CGT reversals. "Friends of
Fiszbin and Althusserians," stated one "unitarian," "are discovering that they have
been on the wrong track; and they are explaining that developments wi11 not occur
because of a tactical battle within the PCF but through a mass deba,te within the
CGT."
As for the CGT reversals, they are proof of the ba,sic problem of internal democracy
within the CGT. In December 1980, the CCN a non-elected leadership structure
decided to "go with Georges Marchais." Suddenly Francois Mitterrand and the Social-
ist Party became the enemy to be cut down because they were hunting on PCF land.
But when the socialist candidate achieved an astonishing score, the leaders of the
confederation still without consulting the rank and file suddenly decided to
~ support him and, later on, to support his policy, which they had al ways opposed.
Moreover, the curves are no longer negotiated very skillfully: time is short, the
leaders a11ow themselves to be carried off every which way and the militants can't
make head or tail of it.
The "unitasians" have recently published a very instructive short document in this
respect: "The CGT, the Elections and the Changes, December 1980 - 29 April 1981:
the Neglected Debate." The 28 pages of this pamphlet, of which 2000 copies were
circulated~ are already having some effect and the "protesters" want to take advan-
tage of the special CCN meeting to start a real debate. "At i;he executive committee
meeting of 23 June our request for the organiza,tion of union meetings prior +.o the
October meeting of the CCN was rejected. Hence, we will return to the attack. But
especially, in order to prepare the spring congress~ we are demand3ng congresses of
a11 unions, and consequently the sharing of manda,tes, the opening of opinion columns
in the press and the circulation of amendments."
Sales of LA VIE OWRIERE, the major CGT weekly, have dropped below the 5000 copy
level; the militants no longer manage to sell stickers for the construction of CGT
offices in Montreuil; the results of the union elections continue to be disastrous..
- But the leaders want to believe that this is only a ba.d period and that in the end
the tough line will be accepted.
COPYRIGHT: 1981 "le Nouvel Observateur"
84~63
cso: 3l00/84~
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POLITICAL SPAIN
PSOE SENATOR EXPLAINS OPPOSITION TO ENTRY INTO NATO
Madrid CAMBIO 16 in Spanish 29 Jun 81 p 53
~Article by Fernando Moran, diplomat, PSOE senator, and author of "A Foreign
Policy for Spain"~
~Text~ Bloc politics is a historic creation. As an organizational form it is
unsatisfactory and extremely dangero~is. Although the bloc-based balance has
averted war, it is creating tensions that can lead to a conflagration--above all,
in the current situation in which the two superpowers have lost the ability to
control and measure the escalation.
If we are not to favor bloc politics we must under no circumstances enlarge the
blocs. Spain's entry into NATO would mean increasing bloc politics on both
sides. It would therefore be an anti-detente action. And the fact is that Spain,
to consolidate its democracy under dif�icult circumstances, needs a reduction of
pressures from extreme postures. Thus, not only from the general standpoint of
peace, for reasons of survival, but also from that of our political cmnstructional
needs, our entry into NATO would be negative. The United States' current position
of seeking to globalize every situation is an anachronism. Globalization is to
consider any zegional situation exclusive].y from the standpoint of a presumptive
overall strategic perspective.
This approach would be appropriate under a total hegemony of the two superpowers.
But this is no longer t'~e case. The bipolarity of power is a thing oE the past.
There are many situations--the Shiite revolution in Iran, the Iranian-Iraqi war,
_ and so forth--that cannot be reduced to an accounting of power between the two
superpowers. Entry into NATO is anachronistic today. It amounts,as has been said
of military high commands, oE thinking in terms of an obsolete situation. Spain,
throughout i~s history, has fallen into this error of fighing battles of the past.
Therein lies our �amous chronic outdatedness.
NATO would appreciably increase neither our military nor our diplomatic covers,
and would increase our risks. The NATO defense area--Article 6 of the North
Atlantic Treaty--does notinclude North A�rica, where we have scenarios o� poten-
tial conflict and tensions. The Canaries would of course be inoluded, but their
inclusion in the NATO zone and their conside~ation as an important point in a
- global strategy would increase the archipelago's political risks.
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Even if initially Spain were not to sign the NATO nuclearization protocol, it
would be impossible for the United States in the intermediate term to insist on
deployment of Eucomissiles by its other allies while granting special treatment to
Spain. The second-generation medium-ranqe missile deployment requirement will
necessarily include Spain. Note also that the Alliance is orientec] toward poten-
tial situations in the Mediterranean, Libya, etc.
NATO guarantees neither the automatic modernization of our armed forces nor the
~ continuation of civil government in power without problems. In any case, just
what does modernization mean? If it means raising the technical level of our
armed forces to that of the most advanced NATO forces, it would mean--one need
only read the charts of the London International Institute for Strateqic Studies--
an increase of some 40 percent in our defense expenditures. No Spanish finance
minister neither UCD ~Democratic Center Union~ nor CD ~Democratic Convergence~--
can accept this. We would be limited as were other NATO cauntries--Portugal, for
instance, and Greece--to modernizing our armed torces within our means. Whether in
NATO or out of it.
As regards guaranteeing our democracy, Portugal was in NATO from its inception,
and was a dictatorship with concentration camps, carrying a genocide war in
' Africa. The two autocratic and fascist coups took place in Greece within Nato.
The same thing occurred in Turkey. NATO has announced an increase in aid to the
Turkish military junta.
In neither of our general elections--1977 or 1979--was the question of entry into
NATO submitted to the voters for deaision. Article 92 of the Spanish Constitution
permits the referendum for questions of transcending importance. Is there a more
transcending question than that of our entry into NATO, which would mean a change
in Spain's traditional position and the subordination of our entire foreign and
defense policies to it? Not to convoke a referendum would be to adopt an attitude
- contrary to the democratic concept. It would shatter the very minimum set of
values needed to consolidate our democracy and would demonstrate a historic
insensitivity toward the mentality of the Spanish people.
COPYRIGHT: Iniormacion y Revistas, S.A., 1979
9399
CSO: 3110/120
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POLITICAL SPAIN
DIPLOMAT, AUTHOR EXPLAINS SUPPORT FOR EN'PRY INTO NATO
Madrid CAMBIO 16 in Spanish 29 Jun 81 p 55
~Article by Jorge Fuentes, diplomat and author of "The Line of Detente" and of :
"North-South Dialogue"~
~Text~ No political issue has raised as much controversy in Spain and to date in
this century as that of its prospective entry into the Atlantic Alliance. And
this is not surprising,since it involves the most decisive of undertakings by the
nation in the field of contemporary foreign relations. In 1977, Spain joined the
European political organization--the Council of Europe--with hardly a perceptible
fuss; nor did the decision as to the desirability of entering into the European
economic mechanism--the Common Market--generate any dissension. However, the
question of Spain's relationship with what is considered Europe's military instru-
mentality bids fair to becoming the object of a long parliamentary po~emic.
For the moment, the issue is becoming politically polarized between Atlanticists
and neutralists, with the latter accusing the former of being warmongers and ene-
mies of detente, and waving for their part the banner of pacificism. The truth
- uf the matter ~ s ~`.:t road to neace cai: b:: ~ccess2d from any i^'_2rnationa~
position except one, namely, the one now occupied by Spain: isolation. From that
position, the possibilities of influencing world developments, disarmament, or
the liqui~ation of blocs, are nil.
Spain cannat expect to reap only advantages from her entry into the Alliance.
Problems will ensue from the transition between a lone Eoreign policy and a joint
one: It will be necessary to coordinate positions with oountries that may well
have different viewpoints from ours, increase our presence in negotiating forums,
take decisions with respect to military installations, deal with new slidarities,
aids and possible expenditures. And this with no automatic solutions in view for
the question of other advantages that, like the recovery of Gibraltar o Spain's
access to the EEC, is being habitual].y raised in connection with entry into NATO.
There are, however, certain errors that must be dispelled. The first of these is
to consider the Spain-NATO relationship as a purely militaty matter that, for good
measure, will increase Spain's risk of becoming involved i.n a nuclear conflict and
that will in the end be a very costly adventure without compensatory benefits. A
few technical observations are in order on each of these three aspects:
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--The Spain-NATO relationship must not be viewed �rom a solely military stand-
- point. It has a szrong mi3itary underpinning, but it extends to the diplomatic
sphere as a whole, enlarging the framework of our political relationships and
openinq the way decisively toward Spain's~incorporation into Europe.
Our entry into NATO would facilitate the diversification of our relations with the
Western countries, while at the same time strengthening our friendship with the
United States. Among the 16 nations, Spain could easily be the 5th or 6th. In a
bilateral agreement with the American superpower, our neqotiating position would
perforce be a decidedly inferior one.
--Would Spain's entry~into NATO increase our chances of becoming involved in some-
one else's war? Currently, it is not so much a war as a war psychosis that the
world must deal with, as a result--an inevitable one at the moment--of an inter-
national society based on a cold peace and on a nuclear balance as a deterrent
element. It must be added, however, that neither the NATO countries, nor the
Warsaw Pact countries, nor the neutrals, nor the nonaligned countries can escape
this psychosis.
--As to the cost of the NATO operation, one must be very cautious in commenting,
in that it does not make sense at one and:the same time to blame the military-
industrial complex for raising the standard of living in certain countries and to
claim that our Al.liance quota will ruin Spain. Suffice it to say that the organi-
~ zation provides for negotiating the terms and conditions of entry--and as of now
no two of the 15 countries in NATO have exactly the same statute in this regard--
as well as each country's economic participation and even the type of armaments
each one is prepared to adopt.
There are rarely any ideal solutions in foreign policy. A world based on genuine
peace, without blocs or armaments, is undoubtedly the ideal solution. But in no
wey is it the foreseeable one, at least within a politically reasonable timeframe.
If NATO at one and the same time gives us increased specific weight in our rela-
tions with our traditional friends--the Latin American countries--and enables us
to dispel misunderstandings with our neighbors to the tdorth as well as to the
South, there appears to be little reasonable doubt that on the decision balance
the side of the advantages will outweigh that o� the disadvantages.
COPYRIGHT: Informacion y Revistas, S.A., 1979
9399
CSO: 3110/120
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POLITICAL 5PAIN
PUBLIC OPINION POLL REPORTS SPANIARDS AGAINST FNTRY INTO NATO
Madrid CAMBIO 16 in Spanish 29 Jun 81 pp 50-55
~Article by Jose Manuel Arija~
; ~Text~ The relative majority of Spaniatds do not want to enter NATO, consider the
issue important enough to be resolved �orthwith, and prefer that the question of
~ whether or not Spain will enter NATO be deoided by re�erendum. More than one-
third of our citizens, however, do not know what NATO is about.
I This may well be the animated image being acted upon at this time with regard to
our country by the political and military authorities in the Brussels headquar-
I ters, the head office of the Atlantic Alliance, by which name NATO is also known.
; It is a complicated "dossier" that will give rise to many headaches and that
~ furthermore will require extraotdinary persuasive ability on the part of the coun-
i
; tries and Spanish political groups that favor Spain's entry.
I
i In an exclusive CAMBIO 16 poll, carried out by the Instituto Especializado Gallup,
S.A, during the month of riay, the interviewees were asked:
~
; "Personally, and based upon what you know of the issue, are you for or are you
! against Spain entering NATO?" To this question, 27 percent replied that we should
i enter, 39 percent said they were against our entering, and 34 percent did not
know or did not respond.
~ Among the two-thirds o� the interviewees who replied detinitely for or against,
there is thus a diffetence of 12 percentage points in favor of those opposed to
entry. This yes-no gap widens in favor oE the noes among the men, younger per-
sons and the northern half of the peninsula except Galicia. By social classes,
only the upper class exhibits a majority in favor of entry; the rest, and above
all the lower middle class, rejects it.
Aside from Galicia and the upper class, only the southern zone is relatively
favorable to entry, although in Andalusia half the population does not know what
NATO is. There, 45 percent of the women, half the persons over age 55, and 46
percent of the lower class had not heard of NATO or did not respond.
' 29
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Key to Chart I:
The poll 2. No to NATO entry
1� Yes to NATO entry 3. Do not know/no answer
Key to Chart II:
1. Environment 4. Sex
a) Barcelona a) Male
b) Madrid b) Female
c) More than 100,000 inhabitants S. Total
d) 10,000 to 100,000 inhabitants
_ e) Less than 10,000 inhabitants 6. Do you want Spain to enter into
2. Social Class NATO? (By percent).
a) Lower a) Yes
b) Lower middle b) No
c) Middle c) Do not know/no answer
d) Upper middle and upper 7. Is entry into NATO an important
3. Region matter or not? (By percent).
a) North a) It is important
b) Northwest b) It is not important
c) Central c) Do not know/no answer
d) South
e) East
f) Northeast
Key to Chart III:
1. Total
2. CD
3. PCE
4. PSOE
5. UCD
6. Basque Nationalists
7. Catalonian Nationalists
8. Yes or no to NATO entry, by voters of each party (in percent)
a) Yes
b) No
c) Do not know/no answer
9. By what procedure should NATO entry be decided? (In percent)
a) By vote of the Cortes
b) By referendum
c) Do not know/no answer
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, ~
o ` _ 1tf ~
~ SI A LA OTAN 27 ~
~ ~ NO A LA OTAN 39 % r ~
_ , . - ('3~ NO SABE . . , : ; - o ; ~ ` ~ � `
Chart , NO.:CONTESTA . ~ ~ ~ '
I _
. ~
Chart
II
~a~ si
~
F (b) NO
No sabe.
c
- ~ ~ ~ No contesta
(a) ~ ~ .~~r
, ~C r y if, �
Es importante ~
{~.t.~~ t.
'~7M'~ t.'..i ,:xf_L ~i!5..~
' ; No es importante ' � ;27' �
No sabe.
No contesta
(1) (Z) (3) (4) (5) ~6) (7)
TOTAL CD PCE PSOE UCD NACIONALISTA3 NACIONALISTAS
~ VASCOS CATALANES
~a) SI 64:: 14 `Yt ~tl ` 20 z , ~
Chart ,n~-: t~
III ` (b) , ;
NO ~15 ~ 72 s ,
~a ; 7.1
Nosabe. ' ' S~{ ~
No contesta 2~ ~4 � , 13{',; ~ .9 ~
(a) Porvotacion z ` ~
en las Cortes ~ 0 + ~w ~ 14 ,
.,s .o~i;,i''~
~ ~cf
gss;'E i
En referendum 63~' 91 ~~~~,7~; ~ 82
t� ~~Yi~i` f Y
No sabe. 4 9 ~ r;'~ 11 ~ 4
. ,
. . . . . _ . . No contesta , , ,
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On the whole, the 34-percent national average that did not know or did not respond
could be decisive in tilting the national majority �or or against our entry into
NATO--above all, if the citizens are consulted directly.
According to the poll's findings, 69 percent of the persons interviewed responded
that the procedure for deciding the question should be a referendum. Only about
12 percent favored resolving it by vote of the Cortes.
The persons interviewed appear to have a very clear idea as to the alternatives
for deciding the issue--referendum or the Cortes--since only 19 percent did not
know which of the two should be used, as compared with the 34 percent who did not
know the issue involved. It is as if they were saying: "Since I don't know what
it is about, let them ask me; that way, they will have to explain it to me; where-
as if the Congress of Deputies decides it, I will never know what it is about."
At the request of CAN~IO 16, Gallup's specialized interviewers also asked the
persons polled, who were representative of the population as a whole, to what pol-
itical party they gave their ~ote in the last elections. We wanted to know the
for- and against-NATO picture according to voters' political preferences.
The findings resulting from this question show Democratic Coalition voters radi-
cally favoring entry (64 percent), as opposed to the Communist Party voters' fur-
ious show against it (72 percent).
As for the socialists, twice as many (45 percent) are against it as are for it (23
percent); and among UCD ~Democratic Center Union~ voters the largest percentage do
not know what NATO is, while only 34 percent favor entry as against 21 percent who
oppose it. The voters of the Basque and Catalonian Nationalist parties also show
_ strong opposition to entry.
With regard to the method of deciding the yES or no to entry, the voters of all
parties are decidedly in favor o� the referendum. They all also consider the
issue important. Only among the Basques did less than 50 percent rate it impor-
tant.
~End of report on Gallup poll �indings; comments on cost estimates follow~
The Cost
There is no agreement on what it will cost Spain prospectively in terms of money
to enter NATO.
The figures being bandied are widely disparate. Some talk of thousands of mi1-
lions, others say it would cost nothing, and still others say it would actually
result in profits.
Some who calculate the cost in terms of thousanc3s of millions of pesetas include
in their figures the modernization of weapons and the necessary restructuring of
Spain's armed forces. Many others add that this cost must not be included, since
our armed forces must in any case be modernized.
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Following aze the opinions of the experts consulted by CAN~IO 16:
Guillermo Medina (UCD), chairman of the Defense Committee of the Congress of
Deputies: $15 million.
Spain will have to defray approximately 5 percent of the NATQ civil and military
budgets, namely, some $15 million. In the second place, she will have tcr con-
tribute a negotiable amount to the organization's common infrastructure budget;
prospectively, this amount should not exceed $50 million. In the third place,
Spain will have to adjust her defense spending to meet NATO guidelines and recom-
- mendations, although these recommendations are applied flexibly, taking into
account the economic circumstances of each country. Furthermore, Spain has
already �or some time been devoting an economic et�ort to defense--which she would
- have to continue developing whether or not she enters NATO--that could be adjusted
to the organization's recommendations.
Indirectly, Spain could benefit economically from thes~ costs, investments in
= installaticis, access to technolog?es and data, etc., by way of which her -~et
- balance in .:~is respect could even be a profit.
In any case, the pro-NATO defense option results considerably more economically
viable than a neutralist armed approach.
Fernando Reinlein, DIARIO 16 specialist on defense matters: We would save money.
Figures can be deceiving and juggleable. In any case, it would be a less costly
system than neutrality. If those opposed to Spain's entry into NATO fall into the
trap of saying it would be c~stly, they will be serving up on a si~.ver tray a
strongly exploitable argument by those who favor entry. It all depends upon the
terms and conditions involved in such entry.
Jose Juis Buhigas, secretary of the Communist Parliamentary Group's Defense Mat-
ters Area: More expenditures.
Quoting fiqures on the costs that would be involved in Spain's entry into NATO is
at best dicey. There are no objective data on which to base the economic aspects
in determinable quantitative terms; such determination must depend on a number of
variab].es directly related to the missions that wculd be assigned to the Spanish
Armed Forces within the framework of the Alliance.
In any case, it is obvious that an increase in expenditures would be involved, not
only because addita.onal militarg functions would have to be undertaken but also
because we would have to share in the support of a new bureaucratic-administrative
structure that would have to be created for this purpose. Lastly, it must be
taken into account that the member countries ot NATO
thP~ r roape~-t-3. ge s y 3 percent of their GNP, a recommendation that,
if carried out in our country, would lead to practically doublinq the figures now
being allocated to defe~se. -
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Luis Solana, socialist spokesman �or the Defense Committee of the Congress of Depu-
ties: Independence.
Spain's entry into NATO will cost exactly what the pro-NATO government wants it to
. cost. Our entry into NATO is a political issue, not a military one nor an econo-
mic one. A political gain, where powers like the United States are conc~rned, is
paid for regardless of its cost; even to the extent of making Spain's entry into
NATO free. I trust the left will not fall into the trap of a debate on what NATO
will cost Spain. The cost of t4AT0 is national independence.
Guillermo Kirkpatrick, deputy secretary general of AP ~Popular Alliance~ and in
charge of international matters: 3,000 million.
The cost of our entry into NATO would not exceed, from the standpoint ot expendi-
tures on in�rastructure, 3,000 million pesetas, and I would like to draw two com-
parisons. First, the cost of a normal budget for 1 year for a ministerial depart-
ment of the Spanish government, which is over 3,000 million. And the second
comparison is the money the government will be giving to the labor federations,
which is 2,400 million. ~
Greece, Portugal and Turkey are NATO member countries and are as poor as we or
poorer; they were nevertheless able to undergo the cost--a cost, let us remember,
that is not an assessment imposed by NATO, but is rather the contribution made by
each of the member countries according to its own capabilities.
Enrique Mugica (PSOE ~Spanish Socialist Workers Party~), vice chairman of the
Defense Committee of the Congress of deput.ies: $840 million.
Some commentators favorable to Spain's entry into NATrJ reduce their cost estimates
to increaibly low levels, taking into account only the contribution to the main-
tenance of the Alli.ance's bureaucratic headquarters structures. Our membership,
however, will require the adaptation of the troops, weapons and logistic materiel
of our armed forces, which will mean at minimum, for a reasonable degree of homo-
geneization, an initial outlay of $800 million and an annual maintenance cost of
$40 million.
COPYRIGHT: In~ormacion y Revistas, S.A., 1979
9399
CSO: 3110/120
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POLITICAL SPAIN
MAJOR PARTIE5 i~ET TO RESOLVE AUTONOMY ISSUE
Madrid CAN~IO 16 in Spanish 6 Ju]. 81 pp 35, 36
~Text~ After several weeks of negotiations, the autonomy pact has been served up.
The territorial configuration of the State o� the Autonomies is now a fact. Six-
teen communities will comprise the autonomy map, and their respective charters
will be approved by 1983. These among others are the principal conclusions that
are emerging from the autonomies summit of the four major parties after several
weeks of examination of the 22 recommendations made submitted by the team of
experts headed by Prot Garcia~de Enterria on the Spanish autonomies question.
Initially, the meeting was a bipartite one between the governing party and the
PSOE ~Spani.sh Workers Socialist Party~. But the spectrum was soon enlarged to
include the PCE CSpanish Communist Party~ and the AP ~Popular Alliance~, in an
endeavor to achieve total ~harmony in the sensitive matter of the configura-
tion of the autonomies from the standpoing of the adjustments made based on the
first Enterria report.
It was an initiative that drew sharp criticisms from certain sectors of the poli-
tical rainbow. Particularly harsh were the statements made by the AP leader `
Manuel Fraga Iribarne in Castellon. According to the AP's president, it is intol-
erable that after 4 years o~ proceedings on the autonomies question the government
should have �ound it necessary to solicit the opinion of some technicians on what
it has done and on the prospects of actualization. "It is the most glaring
revelation of incompetence to have emerged from the history of Spanish governments
over the last two centuries."
The most heatedly debated points in the negotiations were the el.ectoral system of
the autonomous parliaments and the immunity o� their members, the relationships
of the autonomous communities to the members of the Cortes, and the oonstructive
vote of censure for the purpose of replacing an autonomous government.
Quadripartite Monopoly
Addressing these focal points of disagreement, the parliamentary representatives
quickly reached agreement on particulars such as dates for the holding ot regional
elections. It was unanimously agreed that elections he he1~7 =n a11 autonomous
communities at the same time except in Galicia ar~d Andalusia.
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The monopolization of the meetings by the four parliamentary parties drew criti-
cal fire from the nation's minority patties, which then balked at joining the
autonomy pact. While CD ~Democratic Convergence~ Leader and President of the
- ~atalonian Generalitat Jordi Pujol was receiving the offer through the government
delegate to the principality, Rovira Tarazona, the Basque lendakari, Garaikoetxea,
was being summoned personally by telephone by Prime Minister Leopoldo Calvo
Sotelo. At the same time, the other patties taking part in the talks deci2ed to
consult with their respective regional organizations regarding the agreements
reached.
But the participation o~ the PNV ~Basque Nationalist Party~ could not be obtained.
On the heels of the tense meeting between Garaikoetxea and Calvo Sotelo, the PNV
leadership decided it would not take an active part in the matter, on the basis
that at that point everything had been agreed and the entry of a Basque represen-
tative into the proceedings could only be as a silent guest. The spokesman for
the Basque group in the Congress, Marcos Vizcaya, had conditioned its presence
on the obtention of guarantees that it would be ak~le to take part in the proceed-
ings preceding any agreements. The PNV's dissidence became more acrid when it
learned that the second Enterria report advises the government to increase the
tax assessment against the Basque Region to cover the responsibilities the latter
does not assume.
While the meetings being held in the Moncloa were in progress, the Congress of
Deputies was also receiving the preliminaty draft of the Valencia Region's Autono-
nomy Statute as well as that of Castilla y Leon, representing, in the opinion of
Minister of Territorial Administration Rodolfo Martin Villa, the first concreti-
zation of the Enterria concept.
The Constitutional Committee of the Congress was also concluding its debates on
the articles of the Draft Statute �or Andalusia, the last of those drawn up under
the controversial Ar~icle 151. The text of the autonomy statute approved despite
the opposing vote ot the PSA ~Andalusian Socialist Party~ wil]. be submitted to
referendum before 25 October this year. The provincial composition of the 109-
member Andalusian Parliament will consist of 18 deputies for Seville, 15 for
Cadiz, 13 for Cordoba, Jaen and Granada, and 11 for Almeria and Huelva.
Clearly, the fourth meeting between Prime Ministes Leopoldo Calvo Sotelo and the
Basque ~.endakari Carlos Garaicoetxea did nothing to narrow the areas of disagree-
- ment between Madrid and Vito~ia.
The Lendakari's Visit
After a 1 and 1/2-hour meeting last Thursday the 25th, Calvo Sotelo accompanied
the Basque lendakari to the door of Moncloa Palace, where the latter, with a
gesture as if lost in thought and a put-on smile on his lips suited to the occa-
sion, waited untiL he reached the bottom of the stairs to respond to the questions
of the bevy of reporters present who had been awaiting the outcome of the meeting.
Despite the good intentions e:tpressed by both political leaders, issues filling
Garaikoetxea's briefcase and important to the Basque government, ~uch as the
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Quota Law under the Economic Accords, the schedule and speeding up of transfers,
the Draft Autonomy Law, and the Draft Basic Law Regulating Local Administration,
were not satisfactorily resolved.
The lendakari nevertheless emphasized the importance o� these meetings, saying,
"It is now a matt~r of record--and in this sense I think communication is always
helpful--that once again the Spanish prime minister has reaffirmed the govern-
ment's intention to advance the progress of the autonomy proceedings."
It is also evident that, from the Basque viewpoint, the PNV leaders have a differ-
ent interpretation of the autonomy concept's application and development. The
safeguarding of the Basque ins titutions recognized in the Statute of Autonomy is
a daily-recurring leitmotiv that the PNV leaders are in agreement in bringing out
on every possible occasion, as did Xabier Arzallus, president of the Euskadi Buru
Batzat, last Sunday 28th during the inauguration of the batzoki (public housing)
in the Basque locality of Ea: "In Madrid, they think they have given us too much;
but 4 years ago, no one thought we would obtain our autonomy and economic accords
for the Basque Region. We have come a long way in a short time."
_ In this continuing tug-of-war between Madrid and Vitoria, and while the nation's
major political parties are trying to draw up a common strategy based on the
report submitted by Prof Garcia Enterria, political sectors do not hesitate to
accuse the PNV of mongering political ftustrations, lamenting in tutn the impa-
tience and defeatism being exhibited by the Basque executive body. To cut short
all types of interpretations, Carlos Garaikoetxea himself, taking advantage of his
lightning trip to Madrid, sought to dot the i's, asserting: "This theme of frus-
tration-mongering makes no sense. We certainly have no interest in mongering
frustration, considering that in so doing we would be saying that our political
strategy is not being very successful. In this regard, we are obliged to tell
our people the truth whether it be pleasant or unpleasant."
The goverriment delegate to the Basque Region, Marcelino Oreja, who 24 hours before
had gone to Madrid to prepare with Calvo Sotelo for the meeting with the Basque
lendakari, said, for his part~ "The current difficulties are to be expected. They
are inherent in everything that is in the process of negotiation, in the transfer
of competencies representing 30 percent of the national budget. But despite the
difficulties, there is on the part of the nation's government a policy-based intent
to go forward with and complete the process of transfers to the Basque Region in
accordance with the Spanish Constitution and the Autonomy Statute."
President Garaikoetxea expressed himself in the same vein, and Madrid and
the Basque government have agreed to meet again in 1 month's time--a month that
should at least enable the UCD ~Democratic Center Union~ government to put the
_ finishing touches to its intentions, if a definitive agreement can be reached
among the various political organizations on the autonomy issue, an agreement
based on the Enterria report.
Only hours before Carlos Garaikoetxea le�t for Madrid, imp].acable terrorism stsuck
again, felling two victims in Guipuzcoa.
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Inaki Ibarguchi, a PNV militant and member o~ the Nationalist Junta of Miravalles
(Biscay), and Juan Manuel Martinez Castanares, hit by 10 and 23 bullets respec-
tively, fell mortally wounded in Tolosa, a�ter having lunched at th~ Neti Alai
bar as they had been doing for the past few days before starting their work as
representatives, selling cassettes and Basque encyclopedias door-to-door.
A third person, Pedro Martinez Castanares, a member of the Communist Party
brother of one of the slain men, was also wou.nded, hit by eight bullets. One week
later, doctors are still doing the impossible in an attempt to save his life.
There is great confusion, however, as to responsibility for the shootings. Eye-
witnesses say they distinctly heard the perpetrators shout "Gora ETA ~Basque
Fatherland and Liberty Gsoup~ militarra," and for the police there is no doubt,
based on the empty shells they recovered bearing "Gecco Parabellum, 9-mm" mark-
ings as well as on the manner in which the terrorist commando action was carried
- out, that the perpetrators belong to the military branch of the ETA and that they
mistook the three students for police inspectoLS who had been keeping a lookout on
the Beti Alai bar for the past several weeks.
Tne Basque government's adviser for interior expressed the same view, saying: "I
am personally convinced it was the military ETA." However, the Basque organiza-
tion itself, through the daily newspaper ENGIN, denied categorically having taken
- part, while the Spanish Basque Battalion and the Triple A quarreled over their
conflicting claims to paternity in the matter, which nevertheless did not con-
vince the Basque media.
The reactions of the Basque political parties were not long in making themsel~es
felt. The PNV, the PSE ~Spanish Socialist Party~, the PCE ~Spanish Communist
Party~ and Euskadiko Ezkerra, excluding once again the Basque UCD, held a most
urgent meeting in BiJ.bao and agseed on a 10-minute strike throughout the Basque
Region, under the motto "Fos peace, freedom amd democracy, and against violence
and terrorism."
A Strike Call Without Echo
Either through haste or through lack ot communication, the response to the strike
call had a scattered echo in the Basque provinces. It was louder in the main
streets of the cities than in the work centers. In Vitoria as in Bilbao and San
Sebasti~n, the various municipal corporations, delegations and political leaders
of the convoking organizations took to the streets, interrupting traffic on Bil-
bao's Gran Via and San Sebastian's Avenida de la Libertad. In Bilbao and on the
the heels of the symbolic strike, Xabier ~rzallus stated: "The adjectives abound,
sinc;e every life is equal in value to every other one, and no one has the right
to take it away, but a father is more grief-stricken by the death of his own son,
and a party by the death of one of its own."
COPYRIGHT: Inforniacion y Revistas, S. A., 1979
9399
� CSO: 3110/120 E~
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