YUGOSLAV NEWSPAPERS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP83-00415R006800010001-4
• Release Decision: RIPPUB
• Original Classification: R
• Document Page Count: 41
• Document Creation Date: December 15, 2016
• Document Release Date: December 21, 2001
• Sequence Number: 1
• Publication Date: November 30, 1950
• Content Type: REPORT

FORM NO.
1.6IA
MAY 1941:
."0
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CLASSIFICATION RESTRICTED
CENTRAL INTELLIGENCE AGENCY REPORT NO. ....-
INFORMATION REPORT CD NO.
25X1A
COUNTRY Yugoetlavia DATE DISTR. 30 Nov. 1950
SUBJECT 74goslav Newspapers
25X1A
PLACE
ACQUIRED
25X1C
DATE OF INTO
la:=9021
NO. OF PAGES 1
mmilidittErr =CUBE MAWS
NO. OF ENCLS. 3
(LISTED BELOW)
SUPPLEMENT TO
REPORT NO.
1. Forwarded herewith for your information and retention are the following
Yugoslav newspapers:
a. Review of International Affairs - 25 October 1950
b. Review of International Affairs - 8, November 1950
c. Free Macedonia - 1 October 1950
2. Although the cover page is marked Restricted the attachments are
unclassified.
25X1X
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CPYRGHT
INV
THIS IS 47
? 25x1A
Review"o"T"
INTERNATIONAL
AFFAIRS
VOL. 1, NUMBER 12
BEOGRAD, NO 8, 1950
25X1A
THIS IS Al ENCLOSOIE TO
BO NOT DETACH
FROM THE UNO:
I ake Success and the Far East
On the Problem of Ascertaining the Aggressor
The Economic Situation in the East-European Countries
and the Soviet Union
OEEC in a Deadlock
EDITORIAL COMMENTS:
International Financing of Backward Countries and UNO
A Pact Between the Five Big Powers
Pleven's Plan on German Military Forces
Western Germany and the Schuman Plan
LETTER FROM ITALY:
Crisis in the Socialist Party of Italy
THROUGH THE FOG OF PROPAGANDA:
How the Soviet Union is Being "Stabbed in the Back"
EDITORS: DUSHAN TIMOTIYEV ICH AND ZDRAVKO PECHAR
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Review of
INTERNATIONAL
AFFAIRS
THIS MAGAZINE IS A FREE FORUM
AND PUBLISHES THE OPINIONS OF
LOCAL AND FOREIGN WRITERS ON
VARIOUS PROBLEMS IN INTERNA-
TIONAL AFFAIRS
Issued Fortnightly
Published by:
THE FEDERATION OF ?YUGOSLAV
JOURNALISTS
Yearly subscription: $3, or 16 English Sh.
Telephones: 28-451, 26-715, Post Box 125
Checking account: Yugoslav National Bank
PR Serbia Branch Ni.) 103-906033.
Offices : International Affairs, Teraziye 31,
Belgrade.
A CASE OF HUMANISM
CONTENTS:
Editorial Comments:
LAKE SUCCESS AND THE FAR
EAST
PLEVEN'S PLAN ON GERMAN
MILITARY FORCES
A PACT BEWEEN THE FIVE
BIG POWERS?
INTERNATIONAL FINANCING
OF BACKWARD COUNTRIES
AND UNO
Observer 3
4
5
6
AN INCREASE FROM 32 TO 50
PER CENT 6
WESTERN GERMANY AND THE
SCHUMAN PLAN 7
VISHINSKY'S LATEST CONTRA-
DICTION
JAPAN'S NEW CHANCE
From the UNO:
ON THE PROBLEM OF ASCERTA-
INING THE AGGRESSOR. . . .
THE ORGANIZATION FOR EU-
ROPEAN ECONOMIC COOPERAT-
ION IN A DEADLOCK
8
...... RB. 9
0 A. 11
THE ECONOMIC SITUATION IN
EAST-EUROPEAN COUNTRIES
AND THE SOVIET UNION . . . . . . . M. Veldich 12
Letter from Italy:
CRISIS IN THE SOCIALIST
PARTY OF ITALY
Through the Fog of Propaganda:
HOW THE SOVIET UNION IS
BEING "STABBED IN THE
BACK"
F. K. 14
D. T. 15
"DON'T BE SCARED, KID, THIS IS NO ATOMIC BOMB ? JUST AN OLD-FASHIONED, CLASSICAL WEAPON!"
("Je ? Beograd)
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VOL. 1, NUMBER 12
Review of
INTERNATIONAL
AFFAIRS
NOVEMBER 0, 1950
EDITORIAL COMMENT
LAKE SUCCESS AND THE FAR EAST
AKE Success and the Far East
?for several months these two
have been the main forges of world
events. While the earth rotates
around its poles at a speed of
24 hours per turn, political events
follow one another with varying
tempo around these two poles which
serve as points of orientation for
finding one's way in international
affairs.
At Lake Success and in the Far
East, the United Nations were faced
with a hard test. The tempo of ev-
ents at certain moments was so ac-
celerated that almost the whole
world was caught up in the very
unpleasant feeling that it was
approaching disaster. The danger,
however, did not consist only of
the fact that the tension in
relations was greater than it had
ever been before in the post-
war period, but also of the fact
that the UNO found itself at a
crossroads. There were two roads
in front of it: to submit to force
and to accomplished facts, mean-
ing the road which had led to the
degeneration of the League of Na-
tions, or to follow the course al-
ready laid out at San Francisco, a
course of collective defense of peace
by all means and at any price.
The United Nations chose the course
they would take in the spirit of
San Francisco and the Charter and
in that way preserved their place in
the world and their future role in
international events. This is, of
course, a summary estimate of a
whole series of recent actions by
the UN and it does not take into
account various concrete measures
and acts which deserve serious cri-
ticism and which decrease to a con-
siderable degree the positive role of
the United Nations during this year.
It should not be forgotten that the
degeneration of the United Nations
to the level of a passive observer,
such as the League of Nations was,
would mean the practical end of the
United Nations. It would lead to the
formation of two blocs between
which there would be contact only
at those points where interests con-
flicted and this would be a sure road
to war.
It is not probable that the conflict
in Korea will develop directly into
a world war, although it was pos-
sible for this to happen. But it is
clear that the crack-up of the United
Nations under the burden of events
in Korea would leave the doors wide
open for a new world war.
In doing its fundamental duty in
the most difficult moment of the
post-war period, the United Nations
is faced with the task of correcting
to the greatest possible extent those
faults which were plentiful in its
actions connected with events in Ko-
rea. On the basis of this experience
it should adopt decisions that would
in the future guarantee the most ef-
fective and constructive action in
every situation.
It we look at the present work of
the General Assembly in this light,
we shall see that there is, in e..sence,
a conflict betwen two tendencies.
One is the line of maximum acti-
vation of all member-states and con-
solidation of the material forces
? 3 ?
which will support their decisions.
The second is the tendency being
championed by the USSR which
consists in making collective action
by the United Nations as difficult
as possible, that is, replacing the
United Nations by some sort of
Trusteeship Committee over junior
states. The trustees would according
to that plan be the big powers (five
of them) while all the other states
would be relegated to the role of
juveniles.
The United Nations rejected this
attempt to transfer the Soviet
method of solving political problems
to the UN. Actually, this is nothing
else than the introduction of a sys-
tem of privileges and imposition of
one will on others which has found
such obvious expression in the at-
tempts to wrest their hard-won in-
dependence from the peoples of Yu-
goslavia.
However, this attempt by the So-
viet diplomats at the General As-
sembly deserves special attention
in the light of the present situation
and the experience of the recent
past.
Pushing the people of Korea into
the horrors of a sanguinary armed
conflict on the basis of utterly er-
roneous appraisal of the reaction
which this reckless adventure would
provoke in the world, the Soviet
Government suffered a serious po-
litical defeat and loss of prestige
The endeavor to achieve its expan-
sionist program in one specific sec-
tor by a fait accompli and simulta-
neous boycott of the United Nations
did not succeed. The Soviet repre-
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EDITORIAL COMMENT
sentative had to return to the Se-
curity Council. Instead of a triumph
over the United Nations, the Rusian
rulers met their Canossa.
The insincerity and hypocrisy to-
ward the United Nations, using the
Charter as a vehicle for demagogic
speeches and the legal acrobatics of
Vishinsky, are at the bottom of the
Soviet proposal on the so-called
pact of the five big powers which is
not being presented for the first
time. And here it is necessary to em-
phasise that this Soviet proposal
on a big power pact is being repeat-
ed. This pact has already been on
the agenda of the General Assem-
bly, and has again been pulled out
of the files. It contains the funda-
mental conceptions of international
cooperation of the Moscow rulers.
From Teheran, through Yalta to
Potsdam, the Russians thought of
mutual bargaining among the big
powers as the essence of internation-
al relations, to avoid misuse of the
word cooperation here. While such
a method of solving current prob-
lems was understandable in the
war period and was, as a ne-
cessary evil, both necessary and ad-
vantageous despite all the harmful
after-effects in certain concrete cases,
it is absolutely unacceptable and
dangerous as a permanent method
of solving international problems.
The UNO was founded precisely in
order to graduate from the narrow
framework of war conferences to
broad international cooperation after
the end of the war. What is more,
practice has shown that some of the
problems that were left to the big
powers for solution had to be put
to the United Nations anyway, like
the question of Korea, for instance,
and the problem of the former Ital-
ian colonies, etc.
The fact that the Soviet Delegation
at this session came out with its
proposal on the big power pact, af-
ter it had tried to break up the
United Nations by boycott of UN
and the provocation and abetting of
the conflict in Kore a. shows
that the USSR is not abandoning its
hegemonistic policy. But it is, at the
same time, forced to recognize the
authority of the United Nations.
It is to be hoped that the Gene-
ral Assembly will remain consistent
until the end of its work on certain
points to the policy of consolidating
the UNO, and that it will thus be
made capable of playing its historic
role.
On the other hand, the UNO is
faced with even more difficult tasks
in Korea and in the Far East in ge-
neral. Various indications and the
most recent reports show that the
problem of the Far East will demand
a great deal of statesmanlike wisdom
and understanding of the aspirations
of the peoples of Asia. Undoubtedly,
the UN will have the opportunity
to put the results of this year's ses-
sion to a practical test there. What
the UN does in the Far East will
have to confirm the theory and prin-
ciples which are forged at Lake Suc-
cess. Only complete accord between
theory and practice will assure UN
activities full success which will
consist not only in saving the autho-
rity of the Organization in one con-
crete case, but in permanent con-
solidation of world peace.
OBSERVER
Pleven's Plan on German
Military Forces
ONCE agreement had been reach-
ed in principle between the
three Western powers and in the
Atlantic Pact Council regarding the
setting up of "an international army
for the defence of Europe", and on
the participation and contribution of
Western Germany to the military
efforts of the Western powers, the
question of the ways and the scope
of West German participation was
next to be placed on the agenda.
Widely varying ideas have been
advanced by Western public opinion
?ranging from outright opposition
to any sort of rearming of Western
Germany to her being placed on an
equal military footing with the other
partners in the Western sphere.
All these conflicting concepts have
been particularly pronounced in
France herself, as an outcome of
that country's specific position and
her evil experience with Germany.
? 4 ?
Her attitude, contained in the
declaration read in the Chamber of
Deputies by Premier Pleven, reflects
two fundamental contradictions the
Franch leaders have been confront-
ing on the issue: the desire, on the
one hand, to utilize Germany's eco-
nomic and military potential for the
organizing of the "defence forces" of
the West and the endeavours, on the
other, to secure for France that role
in Europe which by virtue of her
industrial and military potential
might be assumed by Germany, in
the event of the latter being allow-
ed to participate' as a more or less
equal partner in the military efforts
of the Atlantic Pact member-states.
The idea contained in the Schu-
man Plan ? that Europe should first
be unified and organized, co-ordinat-
ing its efforts in the economic field
by adopting the Schuman Plan for
the merging of the coal and steel
industries as a prerequisite to West-
ern Germany's participation in
the "joint military efforts" of the
Western powers ? reflects the en-
deavours of the French Government
to secure for France s ich political
and economic positions in Europe
which would safeguard her from any
surprises on the part of the future
German partner.
The proposal on the incorporation
of minor German units, numbering
between 800 and 1,200 men, in large
tactical units under non-German
command, represents a safeguard a-
gainst the possibility of Germany's
becoming militarily independent, and
is designed to allay the fears of the
French national masses from an e-
ventual revival of German milita-
rism.
These questions form the subject
of discussions between the Western
powers today. It is necessary to add
that the attitude adopted by U. S. A.,
and shared by Great Britain, differs
from the view put forward by Fran-
ce especially as regards the French
proposal concerning the formation of
"atomized" German units within the
army of Europe. The U. S. considers
that sanction should be given for the
formation of German divisions un-
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der German command which
would be incorporated in the so-
called Army of Europe. This U. S.
attitude 's explained by the fact that,
in this instance, the U. S. is probably
less anxious about the individual in-
terests of the countries involved
than about the realization of West
European and the so-called Atlantic
region's consolidation in a military
sense.
The Prague conference of foreign
ministers of the East European
countries, as well as the resolution
which was passed on that occasion,
aimed at trying to hinder the plans
of the Western powers by appealing
to the German people in the first
place. On top of that, it was neces-
sary to shed responsiblity for the
adoption of further, primarily mili-
tary steps and the other forms
of affirmation of the East German
State. The appeals launched from
the Prague conefrence for the creat-
ion of a united Germany, and against
remilitarization and the re-
vival of Western Germany's arma-
ments industry, etc., sound insincere
when set against the notorious fact
that, under the guise of an East Ger-
man police force, German military
units are in effect being created,
that on the Oder river in East
Germany huge steel mills are being
erected with an eye on military
requirements primarily, and that
other measures are likewise being
undertaken with a view to the
definitive isolation of Eastern
Germany and the bloc of East-
European countries dominated by
the USSR.
There is not the slightest doubt
that the policy of USSR has been
largely responsible for the develop-
ment leading to the proposals and
measures for the re-arming of Ger-
many, a development in no way re-
lated to the need for the establish-
m-nt of a united, peace-loving and
democratic Germany in Europe,
which had also been the aim of
peace loving nations in the Second
World War.
EDITORIAL COMMENT
A Pact Between
the Five Big Powers?
APACT among the big Powers
? that is the governing idea
in the foreign policy of the Soviet
Union. To keep the small ones aside
during the adoption of decisions and
to strike bargains with the big ones
at the expense of the small ones. The
example of Yugoslavia is sufficiently
eloquent ilustration of this Soviet
tendency. But this is not only a mat-
ter of Yugoslavia. Soviet sche-
mes with regard to Greece, Bulgaria,
Spain etc., are well known. Did not
the Soviet representative in ;945,
when the fate of the formGr Italian
colonies was being decided by the
USA, Great Britain, and the Soviet
Union, propose the division of Libya
into Cyrenaica and Tripoli with Cy-
renaica going to Great Britain and
Tripoli to the Soviet Union. And did
not Mr. Vishinsky in 1948 propose
? again to the big powers ? that
all the former Italian colonies be
divided up among the USA, Great
Britain, France and the USSR.
The small countries represented in
the UNO, and with them all the peo-
ples of the world, have opposed this
policy on more than one occasion.
It was necessary to suffocate the
voice of these small ones. Especially
since at that moment Yugo-
slavia pointed out that great words
and phrases on democracy can con-
ceal selfish, hegemonistic interests.
At last year's UN General Assem-
bly Session, the chief of the Soviet
Delegation, Vishinsky, on Septem-
ber 23, 1949, proposed in the general
debate that the big powers con-
clude "a pact for the consolidation of
peace". The pact was not conclud-
ed but the Greek liberation move-
ment was sacrificed as the price
which was to show the good inten-
tions of the USSR toward the other
big powers.
The situation in the world is such
that it is clear to the politicians of
the western countries that a big five
power pact would be unpopular be-
cause the masses would see in it an
obstacle to the work of the UNO
? 5 ?
which they consider as the most suit-
able institution for the solution of
all international problems. But the
USSR did not allow itself to be kept
back in its endeavours.
In submitt'ng "a declaration on the
elimination of the danger of a new
war and on the consolidation of
peace and the security of peoples" to
this year's UN General Assembly
sessl on, the Soviet representative, A.
Vishinsky, again moved the question
of a pact among the five big pow-
ers. The UNO forums are too
broad for the USSR. The small
countries sit in them, and their in-
terests often conflict with the inte-
rests of the big powers so that it
is better if the big countries make
agreements among themselves
behind closed doors. At a moment
when the USSR is pursuing a policy
of division of the world into spheres
of influence, when it is by-pass-
ing the interests of the small coun-
tries in order to satisfy its hegemo-
nistic motives, the five big powers'
pact would undoubtedly represent an
institution for the subjugation of
the small countries. Cooperation a-
mong the big powers is an import-
ant factor in international relations
which can make the greatest contri-
bution to the cause of peace. If the
big powers, primarily the USSR, sin-
cerely want peace, they can best
build it through the UNO, through
the Security Council, meaning
through forums which have been
provided for that purpose and
which are most suitable for
it. The political situation in the
world demands that the General
Assembly, that broadest of all in-
ternational forums, make the most
responsible decisions. Narrowing the
competence of the UNO today is not
only unpopular, it is harmful. And
a big five power pact as proposed
by the Soviet representative would
have this narrowing effect and
would mean the danger of its being
transformed into an instrument of
the big powers at the expense of the
small ones.
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Inter national Financing of
Backward Countries
and UNO
T N the discussion which has been
going on a month already in
the Economic Committee of the Gen-
eral Assembly on economic assist-
ance to insufficiently developed
countries, two fundamental tenden-
cies have found expression. Those
cuntries from which the help would
have to be forthcoming see the so-
lution primarily in private invest-
ments and propose that backward
countries undertake suitable measu-
res for attracting foreign capital.
They anticipate international action
mainly in relation to the question of
technical assistance to backward
countries. Insofar as economic as-
sistance comes from the governments
of the various states, these states
take the point of view that this help
should be given on the basis of li-
beral agreements, and not through
international organizations. On the
other hand, the other countries, pri-
marily those who need help, take
the point of view that effective help
can be given only through inter-
national organizations by way of pub-
lic international financing, in order
to avoid the danger of interference
by the investors in the internal af-
fairs of the countries receiving the
help. They think that help should
not be based on the principle of di-
rect profits for the various invest-
ments but on the basis of the wel-
fare of the entire national economy
of the country in question, on the
basis of the benefit which they might
have for the general economic de-
velopment of the country and its in-
creasing prosperity. The representa-
tives of the interested countries
rightfully emphasize that private
financing is now in a crisis and even
if that were not the case, it could
not carry out the task facing it for
private investors are interested first
and foremost in direct profits on
their investments and very little or
not at all in the development of the
economy of the respective country
as a whole.
It is significant that the majority
of the delegates to the Economic
EDITORIAL COMMENT
Committee came out in favor of the
latter thesis. The representative of
Pakistan, for instance, proposed the
establishment of a UN bank which
would lend funds to insufficiently
developed countries, which funds
would be needed for the financing
of projects in the sphere of transport-
ation, power, telecommunications,
health, education, etc. On its part, the
Yugoslav delegation proposed the
foundation of an international orga-
nization similar to UNRRA, which
would collect and distribute finan-
cial means to the economically back-
ward countries with the purpose of
promoting their economic develop-
ment. This proposal takes into con-
sideration the points of view brought
out during the discussion and is bas-
ed on the exeprience from inter-
national practice that a rapid and
successful development of insuffici-
ently developed countries is possible
only if they receive help from out-
side which is not linked with any
kinds of conditions which would not
be in accordance with national in-
d pendence.
A decision on this problem is to
be made soon. It is certain that the
UN, in adopting decisions in the
sense of these proposals, would
be taking a big step forward in the
direction of eliminating a whole se-
ries of neuralgic point in the world,
which today represent a source of
instability and danger of new con-
filets. Perhaps it is precisely in this
that we can find the reason for the
stand which the Soviet Delegation
has taken on this problem. The So-
viet Delegate, Arutiunian, who is
abetted by the rest of the Eastern
European delegates, has concentrat-
ed his activities on tales about the
"unselfish" aid of the Soviet Union
to China and Mongolia, on obstruct-
ing and delaying the discussion,
without submitting any constructive
propo-als and avoiding making any
statement as to whether the USSR
would join any such action by UNO.
The correct solution of this ques-
tion, however, regardless of the
stand of the USSR, will be a new
proof of the success of international
cooperation through the UNO and an
important contribution to world
peace.
?6
An Increase from 32 to
over 50 Per Cent.
THE official Polish News Agency
published the statistical data on
the foreign trade of Poland for the
year 1949. From these data, it can be
seen that Poland has effected an ex-
change of goods to the total amount
of 4,952 million roubles, or 1,238 mil-
lion dollars at the new exchange rate
of roubles into dollars, In this
trade exchange, the USSR has par-
ticipated to the extent of 400 million
dollars, or 32 per cent, while the
other Eastern European countries
participated with 160 million dollars,
or 13 per cent. The same agency also
published some summary data about
the development of the Polish for-
eign trade during the first nine
months of this year. It appears, from
these data, that the exchange of
goods with the USSR during this
year has increased by 71 per
cent. If we assume that this
increase in trade might be main-
tained till the end of this year
(the same may be even greater,
but hardly smaller) ',hen one
may conclude that the Soviet Union
this year will participate in the for-
eign trade of Poland by more than
50 per cent. This high percentage of
trade with the Soviet Union clearly
shows the monopolistic position it
holds in the foreign trade of Po-
land. This great increase and one-
sided tendency of the Polish foreign
trade is not only due to the fact that
the USSR buys steadily ever larger
quantities of Polish products for its
own use, but it is also due to the
fact that the Soviet Union buys these
products for re-export to other
countries. This re-export transaction
of the Soviet Union with Polish
goods can be observed best when
one looks at the Polish list of ex-
ports to Soviet Russia, in which
very important items consist of che-
micals and rolled metals. And
those two export items are the chief
items which figure in practically all
the trade agreements, which the So-
viet Union concludes with the
Eastern European and other coun-
tries, which are under its domi--
nation.
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Westei n Germany and the
Schuman Plan
ARECENT declaration has caused
the question of the realization
of the Schuman Plan for joint
control of the West European coal
and steel industry to emerge from
the obscurity in which it had been
languishing for some time, and to
become once more the subject of
lively comment by the world public
opinion. The architect of that
declaration was Dr. Lehr, one of
Ruhr's steel magnates, of the
Vereinigte Stahlwerke. Shunning
all ambiguity, Dr. Lehr stated that
the interests of the German coal
and steel industry lay not in the
realization of the Schuman Plan,
but in the establishment of an
organization similar to the pre-
war International Steel Cartel,
which would regulate the European
market relationships. Although the
West German Government came out
with a declaration to the effect that
their attitude toward the Schuman
Plan had undergone no change, the
entire problem assumed a character-
istic aspect within Dr. Lehr's sub-
sequent inclusion in the West Ger-
man Government as Minister of
Home Affairs.
The creation of a unified coal and
steel market for the participating
countries has been the principal ob-
stacle for the implementation of the
Schuman Plan. A unified market
implies unified prices. But how are
the high production costs of the Bei-
gian coal industry and of the Italian
steel industry to be adapted to the
German costs of production, which
are 50 per cent lower? The French
proposal envisages the establishment
of a compensations fund for indem-
nifying the countries having high
production costs for lossess sustain-
ed in selling at the lower unified
rates fixed by the supreme authori-
ty. The fund would operate by
means of levies on the producers en-
joying more favourable conditions, 1.
e. on the countries having low pro-
duction costs, the practical effect of
EDITORIAL COMMENT
which would be for Western Ger-
many to become the one exclusi-
vely burdened with this levy.
The international market position
at the time of the publication of the
Schuman Plan differed considerably
from the present one. The supply
exceeded the demand, and the prices
were very low. Excess production of
steel was becoming a realitz to be
reckoned with. At that period, it
would have been to the benefP of
Western Germany to join an inter
national agreement guaranteeing her
a permanent market, on the one hand,
and enabling her to attain political
objectives by cooperating in the "or-
ganizing" of capitalist Europe, on the
other. Due to the newly-created
world political situation and the Nvar
trade boom, the German ihrerest
have undergone a thorough change,
H nce the procrastinations and the
blocking of agreement between the
Schuman Plan member-sta
In proposing the Plan, France pri-
marily pursued the materialization
of a European agreement which
would include Germany, too. France
had been reckoning with a debilitat-
ed Germany, such as she emerged
from the Second World War. To lay
though, with an increase in Gex.
many's war potential being only
a question of days ? which bas'eal-
ly alters the substance of Franco.
German relations ? the finalization
of negotiations on the joint admi-
nistration of the coal and steel in-
dustries appears in a new ugh
Whilst there is a tendency from the
German side, as exemplified oy
Lehr's declaration, to defer the con ?
elusion of the agreement, the Frenen
are anxious to conclude it as soon
as possible. It is even suggested in
French official statements that tr e
definitive conclusion of the agree-
ment is pending within a few
weeks.
?1
Vyshinsky's Latest
Contradiction
TARTING from the premise
3 that the USSR is a fearless
champion of peace, which believes
that communism and capitalism can
exist alongside, Mr. Vyshinsky in the
General Assembly's Political Com-
mittee advanced the thesis that the
USSR wishes to trade with the West.
In order to prove this he quoted all
the statements, articles and opinions
of the Soviet leaders on this pro-
position. Finally, he asserted that the
Soviet Union, although it no longer
needed goods from the capitalist
lands, nevertheless upheld the
principl e of the possibility of trade
among countries belonging to dif-
ferent systems.
Between these two parts of Mr.
Vyshinsky's conclusion there obvi-
ously exists a contradiction, but
this very contradiction shows that
Mr. Vyshinsky is consistent ? con-
sistent to the principle of the Soviet
leaders to speak in one way and act
in another. In words he advocates
the principle of the possibility of
trade among countries with different
systems. In practice, however, the
Soviet Union endeavours to narrow
down and prevent as much as pos-
sible all trade between the West
and those countries which are sub-
jugated to the USSR.
But regardless of this, Mr. Vyshin-
sky is right in one respect. Namely,
he is right in aserting that the USSR
does not indispensably need goods
from the capitalist countries for the
simple reason that the USSR covers
its requirements from the lands
which are subjugated to it and whose
foreign trade it has placed under
its direct control. This fact throws
light on M. Vyshinsky's thesis,
which is out to prove that the latter
countries need no goods from the
capitalist states. This thesis should
have to justify the practice of the
Soviet policy in its relations with
those lands.
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A Harmful Decision
GENERAL Franco was undoubt-
edly very happy on November
1st. That day in the United Nations,
for which he feels only hatred and
scorn, a resolution by eight states
was voted revoking the decision of
the General Assembly of December
12, 1946, which had recommended to
the United Nations that they recall
their Ambassadors and Envoys from
Madrid and prohibit membership in
the specialized institutions of the
UNO to Franco Spain. The news
about this recent decision had a sad
echo for all freedom-loving people
in the world.
There is something strange in the
arguments of the supporters of this
resolution when they say that Fran-
co's Spain "helped the UN in the
war against the Axis states", there
is something miserable there that
must make every democrat wince
with shame. The delegates to the
Special Political Committee could not
hide their uneasiness at being wit-
nesses to or even participants in such
open compacts being made with the
enemy of everything which the UN
should serve. For the decision adopt-
ed by the Committee can be quali-
fied in no other way than as an at-
EDITORIAL COMMENT
tempt to consolitade fascism in Spain
and to bring Franco's regime into
the UNO through the back door.
After the war, it was hard to turn
a deaf ear to the demands of the
masses that an end be put to Fran-
co's regime in Spain By the 1946 Re-
solution, which was actually only an
unskillful and lukewarm attempt
to isolate Franco, it was at least
partially succeeded in consoling
the democratic public. But this
concession, made before the over-
powering force of anti-fascist
feeling, Was only a temporary
one. The undermining activities
aimed at abrogating the adopt-
ed resolution and opening the
UN doors to Franco's representatives
did not cease until they finally bore
fruit. The responsibility for this is
borne not only by those who are
open advocates of Franco's regime
but also by his "opponents". The
letters' mild and make-believe re-
sistance has indirectly incited re-
actionary forces to sabotage and de-
stroy the resolution of December,
1946, which was an attempt to settle
the debt of the UN to the Spanish
people whose heroic struggle had
contributed so much to the mobi-
lization of democratic forces before
the onslaught of the fascist hordes.
Ksenlja ILIYEVICH:
A MOTIF FROM RASKA
? 8 ?
Japan's New Chance
THE general international situ-
ation, and, during the recent
months, the war in Korea especially,
have had a powerful effect on the
economy of various countries. Thus
Japan for example, as the only in-
dustrial country in the Far East, has
once again seized variou3 advanta-
ges. And not only because it
supplies the United Nations troops
with many products, but also because
the entire world economy is today
almost in entirety under the 'nflu-
ence of the armaments boom.
All this has given special incen-
tive to the traditional Jopanese ex-
port items. Japan's exports in 1949
were twice as big as they were in
the previous year, while the first
half of 1950 registered an increase
of almost 25?/u. Regulations which
restricted foreign trade and indus-
trial production have been practi-
cally abolished. Japan has been given
a free hand in the textile industry
and its presence on ne.arly all the
world markets is causing grave an-
xiety among other countries en-
gaged in export ? particularly in
Great Britain Under a recent agree-
ment concluded between the repre-
sentatives of the cotton industry of
USA, Great Britain and Japan, the
latter's exports were not to exceed
550/0 of the total Japanese produc-
tion. However, it seems that Ja-
panese producers have, on their own,
decided to increase the part of pro-
duction intended for export to 70"'n.
The world press forecasts that
Japan in 1953 will succeed in im-
proving its economic position to such
an extent that it will no longer need
any American assistance. In the
meantime, judging by everything,
Japan will in the course of this year
already take top place in the
world as supplier of cotton textiles.
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FROM THE UNO
ON THE PROBLEM OF ASCERTAINING
THE AGGRESSOR
DURING this year's session of the General Assem-
bly, the UNO paid a great deal of attention to the
problem of adopting measures which would give le-
gal form to, and implement, an idea which has matured
completely in the consciousness of the great majority
of mankind, and that is the conviction that aggressive
warfare s a crime against humanity.
From the first draft declaration on the rights and
duties of states submitted to the French Convention in
Paris in 1793 up to the present, there have been tens of
declarations making it binding upon states, to one de-
gree or another and in one form or another, to resort
to peaceful means in their mutual disputes and to re-
frain from the use of force. An important step forward
was made especially after the First World War. The
Briand-Kellogg Pact and the London Protocol on
Aggression liquidated from the legal paint of view the
old conception that every state has the right to pro-
claim war on another state as it wishes, and an-
nounced a new principle which condemned and pro-
hibited resorting to force as a method of national
policy.
However, increasingly frequent violation of in-
ternational obligations and the events which took
place before and between the two world, wars prepar-
ed the ground for the idea of a world organization
whose task would, be to preserve international peace
and security and to promote international cooperation.
Thus the League of Nations was created, and it was
thus that the United Nations Organization was also
established ?later. The repetition of acts of aggression
which took place after their foundation put first the
one and then the other world organization to the hard-
est test. The League of Nations did not pass that test
and left the Japanese aggressor in Manchuria and the
Italian aggressor in Ethiopia unpunished, and they
were followed by others. Soon it lost all significance.
The United Nations Organization has withsteed
that test, The UNO has not only promoted the inter-
national mechanism by proclaiming as a crime a-
gainst humanity all preparation, planning and waging
of aggressive warfare,- but also adopted sanctions
against those who are guilty of the above. The events
in Korea have had the effect of consolidating and giv-
ing even more concrete form to the idea of collective
action against the aggressor. The significance of this
has already been demonstrated and it has become a
guarantee of the effectiveness of the UNO. In the
light of the UN decision to undertalke collective act-
ion against the aggressor in any part of the world
whatsoever lends exceptional importance to the con-
9
cept of condemnation of aggressive warfare and to
the duties of member-states which derive from the
Charter.
This decision, however, has also brought another
problem into prominence ? the problem of definition
of the aggressor. It is clear that the rapidity with
which the UN can act depends on its being able in
the shortest possible time to determine the attacker
an the basis of a criterion which will reduce the
possible errors to a minimum. This holds true both in
cases where an effective solution of a dispute by
peaceful means is necessary, or where a decision
must be made regarding military action against the
aggressor.
Are the definitions of
vious international legal
the present situation and
implement UN measures
the aggressor found In pre-
documents satisfactory in
do they make it possible to
effectively? Will the Secu-
rity Council, or the General Assembly, which must
determine quickly and objectively who the aggressor
is before swinging into action in the case of war, be
able to do so on the basis of the definition of the
aggressor such as stated, for example, in the Pan-
American Pact on Mutual Assistance concluded in
Rio de Janeiro in 1947? This Pact considers as aggres-
sion any unprovoked attack by one state against the
territory, population, land, sea or air forces of another
state. As is usually the case, both parties to the con-
flict would immediately announce that they have been
attacked and that they therefore have the right to
legitimate defense. In such a case, it would be rather
improbable that the majority in the Security Council
or in the General Assembly would be able to decide
where the truth lies in the numerous, often very
skillfully provoked incidents and maneuvers resorted
to by the aggressor, and to undertake action.
In the second group of definitions, we have those
resembling the one made in the Convention on the
Rights and Duties of States in Case of Aggression of
1939, of the Harvard Institute of International Law
Research. Aggression is described there as resorting
to military force which represents a violation az' le-
gally undertaken obligations not to resort to such
means, whereby the violation in question is estab-
lished by a procedure to which the attacker agreed
earlier.
According to this definition, the establishment by
a procedure adopted in advance that the obligation not
to resort to war has been violated becomes the cri-
terion for deciding who the aggressor is. But does this
method really make it possible to determine on time
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FROM THE UNO
which is the side that is waging aggressive warfare?
Since the definition does not refer to any cessation
of hostilities the aggressor has a free hand to settle
the matter himself by military means before any
eventual collective action could be undertaken. He
can do so either by making it impossible to establish
who the aggressor is or by circumventing the provi-
sions and obligations by interpreting them in his own
way.
The Uruguayan definition which was proposed at
the present meeting of the General Assembly of the
UNO proclaims as the aggressor any country which
avoids using the means suggested in the Charter for
peaceful solution of disputes. How would that look in
practice? Let us say that war has broken out between
two states. The UNO must first decide who the ag-
gressor is before it can undertake the necessary
measures. This would be ascertained by deciding which
of the two states has avoided using the means pro-
vided for by the Charter for peaceful solution of dis-
putes. The question then comes up again of how to
appraise this "avoidance" exactly, if the UN does not
have any "clear and unequivocal" method for this.
Finally, the aggressor will make use of all possible
maneuvers to deceive international public opinion
and to prove that he tried all peaceful methods but
in vain, before the armed conflict broke out.
The following may be concluded from the above:
firstly, because the procedure of the UN in case of
an outbreak of war does not contain the obligation
to cease fire and withdraw troops, it is imperative to
adopt such provisions in order to make it impossible
for the aggressor, by way of various kinds of maneu-
vers and abuse of procedure, to gain in time for the
continuation and conclusion of the aggressive war;
and secondly, because it is very difficult to establish
who the aggressor is in the above ways since he will
do everything in his power to represent his attack
as legitimate defense, it is absolutely necessary to
find a method whereby he will put the finger on him-
self publicly.
Such a "clear and unequivocal means" is the
method of ascertaining the aggressor described in
the Yugoslav proposal on the duties of states in case
of the outbreak of hostilities which is now under con-
sideration in the Genertl Assembly. This proposal
contans two provisions which all countries are bound
to adhere to when they find themselves party to an
armed conflict. The first is that all countries which
find themselves in an armed conflict must make a
public declaration ,within 24 hours after the outbreak
of war operations, and to inform the UNO that they
are ready to cease firing and withdraw their forces
from alien territory. The second provision says that
both parties to the dispute must within 48 hours actu-
ally withdraw their troops from the territory of
the other state.
Non-fulfilment of these obligations would mean
that the aggressor had automatically revealed him-
self as the aggressor to the whole world. This will
not only make it clear to the public opinion of the
world who the aggressor is but it will also facilitate
and quicken the adoption of decisions by the Security
Council or the General Assembly which would then
be in a position to make an appraisal of the situation
more easily, to determine who bears the main respon-
sibility for the war and to take the necessary measu-
res. And what measures it will take will be decided
in each concrete case by the UNO itself.
The Yugoslav proposals, therefore, not only have
moral and legal validity but practical sigaificance as
well. Their adoption would, on the one hand, make it
even more difficult for any eventual aggressor to de-
ceive the world public and the UNO on the real cha-
racter of his acts. On the other hand, they would make
it easier for the UNO to take effective measures by
rendering impossible abuses and mistakes in the adopt-
ion of decisions to undertake suitable measures, at
least insofar as they might result from the ascertain-
ment of the aggressor. The Yugoslav proposal, there-
fore, is an imperative supplement to that mechanism
of collective security whose foundations were laid at
this General Assembly Session. It really represents an
important contribution to the consolidation of inter-
national peace and international security and the
stregthening of the effectiveness and the authority of
the UNO.
R. B.
Djordje ANDREJEVIC-KIIN : IN THE WAKE CF FASCIST
RAVAGE (Woodcut)
? 10 ?
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The Organization for European Economic
Cooperation in a Deadlock
HUGE expenditures envisaged for the Western
European armaments programmes have once
again placed into the forefront the fear of inflation
and distrust in the stability of the economic strength
of the Marshall Plan countries. Higher production,
foreign currency reserves, coordination of prices and
wages, supply of industrial raw materials, investment
plans and budgetary balance, all these vital problems
which it was asserted had already been in the main
solved, are now once again being raised in a most
acute form. Why? For the simple reason that the
Atlantic Pact countries have undertaken to manufac-
ture armaments on a large scale which will undoubt-
edly affect the already unstable balance of individual
national economies.
William Foster, the new administrator of the
Economic Cooperation Administration, speaking re-
cently of the present and future significance of the
Marshall Plan, declared: "The Europeans are faced
with the basic problem of maintaining their economic
strength, just like we are, whlie their (European)
means are directed toward armaments... A further
increase of Production, further economic integration
of Western European economy and further efforts
to export as much as possible to the dollar zone are
essential to our mutual defence."
The European Economic Council, the highest
body of the Organization for European Economic Co-
operation, at its special session, held from the 6th to
the ath of October, adopted in the main lines the me-
morandum of its Secretariat on "Urgent economic
questions". This document sets out the measures which
the members of the Organization should undertake in
connection with the new tendencies which have ap-
peared in the world economy after the outbreak of the
war in Korea and after the adoption of the Atlantic
Pact countries' armaments programme.
How to suppress the danger of inflation which
looms as a consequence of the armaments boom was
the main subject discussed by the Council. The re-
vision (i. e. reduction) of investment plans, that priori-
ty be given to certain branches of production while
the means for the activities of all others be cut down,
were planned as essential measures. The danger of
inflation, contrary -to Foster's statement, has increased
in view of the fact that in the whale of Western
Europe, with the 'exception of Germany and Italy,
there are no unused production capacites for key
products nor is there ,a surplus of manpower. A lower
production of consumers goods ? coupled with the
general rise in prices, threatens ? according to the
"Neue Ziiricher Zeitung" of October 7th ? to influen-
ce the attitude of the masses of the people.
?Ii
And, true enough, the struggle for higher wages
has again begun in most of the Western European
countries. The upward spiral of inflation is once
more a current matter of discussion,
The Council failed to reach agreement on
another important issue, namely on the measures to
suppress soaring raw material prices and to regu-
late their distribution. The British delegate opposed
the proposal of the majority, saying that the Orga-
nization ?should be very cautious in passing decisions
involving those raw materials for the supply of
which Europe depended largely on overseas coun-
tries. There is no doubt that the present fantastic
rise Cf prices of a large number of items from the
sterling area momentarily gives Britain substantial
advantages which she will not give up easily. There-
fore, the decision of the Council to postpone all
solution to six weeks after the special sub-commit-
tees draw up a proposal, is typical of the attempt to
avoid conflicting interests which will nevertheless
appear shortly in sharp form within 'the Organiz-
ation for European Cooperation.
The possibility of acquiring dollars through the
increased exports to the USA is also causing grave
anxiety among the Marshall Plan countries. The re-
presentatives of different countries, in the first place
Great Britain and France, have pointed out on sev-
eral occasions that to increase arms production
would mean automatically to reduce production de-
signed for export. This, naturally enough, would
lead to results directly opposed to those expected by
Foster.
Characteristic of the latest session of the Europ-
ean Economic Council is the fact that very little atten-
tion was given to the regular questions on the
agenda; such as the liberalization of trade, plans for
the integration of European economy, draft of the
annual report, work of the European Planning
Union. The Marshall Plan countries, feeling grave
anxiety over the latest development of economic
conditions in the world, almost exclusively treated
problems directly related to the impending inflation.
Will it be possible to bring the conflicting inte-
rests of the Western European countries to con-
form temporarily, and especially will it be passible
to apply international measures under conditions
where each country, faced with difficult tasks, is
more inclined to individual actions for the defence
of its own positions? Perhaps the above unambiguous
statement made by Foster on the "further economic
integration of the Western European economy" offers
an answer to this question.
0.
0. A.
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The Economic Situation in the East - European
Countries and the Soviet Union
SINCE the establishment of the Council for Mu-
tual Economic Assistance, the economic relations
between USSR and the countries of Eastern Europe
have indeed hit ?a new trail". Not in virtue of the
forms and the character thereof, however, but ex-
clusively in the direction of increasing USSR pressure
for the economic subjugation of those countries.
Foreign trade between them and the USSR started
to record a sudden rise, experiencing a change in
structure at the same time, while their exchanges
with other countries ran into increasing difficulties.
Simultaneously, references appeared to the attun-
ing of the economic plans of these countries to the
USSR and the expansion of the economic "coopera-
tion" between them. In this way the process, which
so far aimed at the introduction of control over the
foreign trade of such countries, started to gain in
breadth and depth, to ecompass, under the pre-
text of "coordination" of plans and "mutual coope-
ration", the entire economic structure of these coun-
tries. New and more ample forms of political subju-
gation went hand in hand with this. The principal
aim of the whole complex was to make the econo-
mies of these countries as completely subservieni to
the interests of Soviet economy as possible. and serve
for the solving of certain of the latter's contradittions,
being utilized at the same time for expanding the
basis of its activities as a corner stone and starting
point of political subjugation in general. In this re-
spect, the Council for Mutual Economic Assistance
plays the part of the central organ through which
are implemented all the plans for the economic bon-
dage of these countries.
It is interesting to note that the Soviet leaders
still do not consider as sufficient the present extent
of bondage of the foreign trade of such countries.
steering of late, as they do, a course directed toward
their ever greater economic isolation from other
countries. The sharpness of the trend imposed along
those lines in the beginning of 1949 has been respon-
sible for great economic difficulties in these coun-
tries, which only grew in volume due to their adher-
ance to the economic blockade of Yugoslavia. The
difficulties which had resulted in these countries were
exploited by the USSR leaders to exert further
pressure on them, professing "the freeing of their
economies from capitalist markets" as the ultimate
aim.
It is for such reasons that Poland's revised six-
year plan envisions for 1955 a volume of exchanges
with the USSR and the other Cominform countries
amounting to 68 per cent. of her over-all foreign trade
and even regards this percentage as minimal and
talks of striving for a volume equal to more than 70
per cent. (In the 1949-55 period, her foreign trade turn-
over should be raised by 40 per cent., and with the
USSR alone by a full 1386/o).
This is why Czechoslovakia and Hungary, too, are
encountering increasing obstacles in their trade
with other countries, why their raw material supply
and the procurement of capital goods is rendered ex-
tremely difficult, causing vast upheavals which are
to be solved by their further isolation from foreign
markets, and the abandonment of such industrial
branches which are based on foreign raw material
sources. In this manner the process of increasing
subjugation of the foreign trade of the East European
countries on the part of the USSR is becoming tightly
strained.
The control over the foreign trade of one coun-
try by another country ? especially when the latter
holds a leading position ? rePresents one of the
most efficacious instruments of edonornic bondage.
ID. reality, it is the starting point for complete subju-
gation, for the destruction of independence and sove-
reignty, for enslavement .The system and the methods
employed by USSR in imposing such control fully
corroborate the latter's exploitive and hegemonistic
aims. In March last, the review "Bolshevik" (No. 6)
expounded the theme of the trade exchanges between
the USSR and these countries being conducted
at prices which ensure its equivalence. This is not
so, however. The "Zahranicni Obhod" of May 5, 1950,
wrote, on the contrary, that the prices we,.e deter-
mined on the lowest bases prevailing in the
world markets, etc. The price system u,-ed by the
USSR to exploit the undeveloped countries had not
been abandoned, nor had any of the time-honoured
methods of cheap buying and dear selling, 1. e. me-
thode of pressure dictation, blackmail. either been
dropped. Hence the growing economic difficulties in
these countries, which uder the circumstances are
able to expand their exports to the USSR exclusively
at the cost of lowering the living standard of their
toiling masses.
One of the methods of exhausting these countries
? not mentioning the other familiar devices like the
joint companies, etc. ? consists of the conclusion be-
tween them and the USSR of special contracts
for the supply of raw materials for processing and
the re-export of the resultant finished products to
the USSR. This practice is widespread, and reaches
its highest volume in countries having pure Soviet
or mixed companies. The contract clauses relating to
the processing and delivery of finished products are
so hard that their execution is associated with over-
whelming efforts, demanding sacrifices in the form
of additional high-grade raw materials and ingre-
dients which have to be imported from other coun-
tries. This, apart from other matters, is the price these
countries are called upon to pay for their raw
material deliveries from USSR. Pursuing such a course
the USS has expanded its own production basis
and has simultaneously curtailed the production and
general foreign trade possibilities of the East Euro-
pcan countries themselves. This production, in com-
mon with the execution of all the contracts with the
USSR, is supervised by special officials of the Soviet
enterprises ? inspectors. This type of production,
therefore, is given priority in all respects (raw mate-
rials, labour, foreign exchange for purchases from the
West, etc.). Thus placed astride the trade exchanges
developed in this manner and exercising control of
foreign trade the USSR is able to improse the direct-
ion and the kind of production desired, and to in-
fluence the economic structure of these countries
and the development of their productive forces not
from the viewpoint of their own economic building
? 12 ?
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uo but from the viewpoint of the Soviets' own econo-
mic requirements. The supervision of foreign trade
was constantly accompanied by control over product-
ion generally, which means control over the entire
economy. The paths followed in the process, the ex-
ploitive and hegemonistic Methods applied are elo-
quent attestation that no unifying ? logical and natu-
ral ? process is involved but the -process of subjuga-
tion.
In the preamble to the Polish six-year plan it is
stated that it owes its estaiblishement thanks exclusi-
vely to economis cooperation with USSR. The econo-
mic plans of the other countries of Eastern Europe are
also the product of their dependence on and bonda-
ge to the USSR. This dependence was particularly
accented in the powerful pressure exerted on these
countries to effect radical changes in their plans,
which had been set up in conditions of at least seem-
ing economic independence. Poland had to plan
an increase in production amounting to 158.3 per cent
under the new schedule, as against 85-95 per cent
which had originally been envisaged. The 'stress of
the increase is on steel, coal and electric energy, 1. e.
i"on the expansion of the raw material basis and
the creation in the country of a raw materials ba-
sis for war industry". Hungary had to foresee 50.9
billion forints' worth of investments, as compared
with the 35 billion forints originally planned. She,
too, had to envisage an expansion of the raw mate-
rials basis (also cotton, in addition to others). A revi-
sion of Czechoslovakia's own plan was imposed in a
similar fashion, although that country is relatively the
poorest one in raw materials among the East Euro-
pean countries. Bulgaria and Rumania were orient-
ed to the production of raw 'materials exclusively.
All these amendments of the plans and the way
in which they were imposed and are implemented,
the ;derrangements caused thereby in the countries of
Eastern Europe, the reasons advanced to explain away
their need and conditionment ? none of these things
are acceptable to the workers of those countries.
Their eyes are getting opened with growing clarity to
the enormous difference existing ;between 'the reasons
advanced by the satellite leaders in an effort to con-
vince thep). about the need of such changes and of
the upheavals caused, and the true reasons.
At the recent plenum of the Central Committee
of the Polish United Workers' Party reference was
made to the reasons which dictated the changes in
the six-year plan, the higher pace of development,
etc. At the same time, the difficulties quoted in con-
nection with foreign trade and production were of
a timbre which would rather haVe warranted a re-
planning downward with due regard for the specific
conditions of development. There was evident dishar-
mony between such difficulties and the assertion that
there existed all the objective and subjective prere-
quisites for an increase of the scope of the six-year
plan, that by her exchanges with the USSR Poland
had made sure of raw material and capital goods
supplies, and !so on. The mere reference to the 'spe-
cial difficulties encountered in balancing trade indi-
cates that foreign trade, primarily with the USSR, is
not running smoothly. The conduct of foreign trade
under such conditions requires great sacrifices, it
demands the partial sacrificing of the living 'stand-
ard, and thereby finds itself at odds with one 'of
the fundamental principles of socialist construction
? the principle of an improved living standard.
This is best suggested by an example dealt with
by the Polish press, "the entanglement of Polish
leaders in explaining the rise" in the living standard.
The explanation at one point dwells on increased pro-
duction of consumer goods for the purpose of an im-
proved living standard. When this is linked up with
the percentages subsequently 'advanced in support of
the latter improvement, it is seen that the bulk of
increased production is really designated for export
to the USSR. The balance remaining for the domestic
market in no case projects itself favourably as re-
gards an improved living standard owing to the in-
tervening increase in the number of inhabitants.
In order to Meet the USSR demands, Hungary
was forced to hit out at the living standard of work-
ers, proclaiming the working class to be squander-
ers who are careless of their future. The govern-
ment of that country was, therefore, 'obliged to re-
vert to the system of ration cards for staple produce.
This was followed by orders to prevent the forma-
tion of queues outside stores, etc. The gravity of the
situation can be gauged by the breadth of the action
against profiteers, under which category have been
listed even many state enterprises, by the pending
court trials etc. Propaganda tries to explain the decline
in the living standard by profiteesering (although no
explanation is 'offered as to why profiteering should
appear precisely in the wake of Varga's counsels
and the stand overtly adopted by the Hungarian lead-
ers against a high living standard) and the weapon
for combatting it is sought in law suits.
The question of the living standard has become
the central issue in the countries of Eastern Europe,
and it is leading to growing differences between the
leaders ? I. e. those who blindly obey and imple-
ment the directives of the Cominform ? and the
working masses, who are beginning to experience
across their own backs the costs of the loss of inde-
pendence and sovereignty of their countries, and to
realize that what is actually being faced are not the
efforts and sacrifices for the building of socialism,
but the burdens imposed by a stepped-up exploitation
on ;the part of USSR.
M. VELJIC
? 13 ?
Milorack PESIC: IN THE FOUNDRY
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LETTER FROM ITALY
CRISIS IN THE SOCIALIST PARTY OF ITALY
pIETRO Nenni's Socialist Party (the PSI) is in the
throes of a serious crisis which is the consequen-
ce of the growing subjugation of the PSI to the Com-
munist Party of Italy and the Cominform. Certain
leaders of the PSI had earlier left the party, rallying
around themselves the wavering elements and creat-
ing separate organizations such as the PSU (Soci-
alist Party of Unity) and the the PSLI (Socialist
Workers' Party of Italy).
Since the PSI holds itself to be a Marxist work-
ers party it was only natural to expect that it
would strengthen itself after the wavering elements
had fallen away, and that it would win back to its
ranks those members whom opportunists had suc-
ceeded in misleading. However, the contrary occurred
and the PSI ranks are continuing to dwindle with the
crisis in the Party becoming more acute.
The working masses which followed Nenni in the
wish to cooperate with the Communists and to fight
for the unity of the Italian working class thought the
struggle for unity to mean at the same time the
struggle for equality, considered that the struggle of
the Italian proletariat should in the first place be in
keeping with the interests of the Italian working class.
However, the PSI's leadership took the view that co-
operation with the Communists meant backing the
Communist Party of Italy in all its manoeuvres even
when they ran counter to the vital interests of the
Italian proletariat. The PSI's leadership headed by
Nenni thus blindly adopted all instructions coming
from the Communist Party of Italy, that is from the
USSR. This policy has resulted in further splits in the
PSI with the best elements now leaving its ranks in-
stead of opportunists.
What still holds the members of PSI together to-
day is no longer the conscious discipline nor the de-
sire to create a united workers' front, but simply
fear in the face of the intricate internaional situation
and the possibility of a new world conflict.
The USSR's unprincipled and incons4stent atti-
tude on many important issues, with the Communist
Party of Italy and the PSI closely following in its
footsteps, has aroused the masses, while the hesi-
tant and incorrect stand towards the war in Korea
has only brought out more sharply the conflicting
views within the party.
A congress of the PSI was to have been held in
September this year. However, in view of the situ-
ation among the party rank and file, the leadership
thought it best to postpone the Congress to sometime
in December. Pursuing the Cominform policy, the
leadership inevitably had to take to Cominform me-
thods as well. The tendency to bring organizational
questions out into the forefront and suppress ques-
tions of ideological and political work with the pur-
pose of avoiding discussion on them, was clearly
manifested at the preparations for provincial congres-
ses ? at which delegates to the National Congress
are to be elected.
As this tendency has met with the resistance of
sincere champions of socialism, the Cominform lead-
ership has given an initiative for the "purge" of un-
desirable elements, in the first place of unsubmissive
members of the various federations. The reasons
given for expulsions or dismissals were "deviations"
and similar arguments. The object of those manoeu-
vres was to remove from the leaderships of the fe-
derations those who were against blind subjugation
?of the PSI to the Communist Party of Italy and to
the Cominform policy, those who stood for equality
and independence in pursuing a policy best corespond-
ing to the interests of the broadest masses of the
Italian people. Thus Lelio Basso, a member of the
Party's Executive was compelled to resign his post
and pledge himself not to accept candidacy for a
member of the Executive at the forthcoming Con-
gress, because he had "worked towards organizing
opposition to the leadership at the Party Congress.
Basso's adherents, have been expelled (Nisceglie, for
example, in the province of Bari). In Sicily, the mayor
of Ragusa and two hundred peasants left the PSI
owing to the unbearable dictatorship of the leader-
ship, Who, they declared, "have betrayed socialism
with their subjugation to Togliatti and Moscow."
As opposed to earlier secessions from the Party
which at the same time actually 'strengthened it, to-
day there is a danger of the best elements leaving the
PSI. In view of this danger the wrath of the Comin-
form leadership has been levelled especially at the
so-called centrists. Whereas the usual centre in a
workers' movement constitutes its wavering part, pre-
pared to serve the bourgeoisie, in the PSI the cen-
trists are fighting for equal relations among parties
and for socialism. They hold the view that the lead-
ing role in a revolution belongs not to the state,
but to the proletariat. They recognize the great me-
rits of the Russian proletariat, which was the first
to carry through a socialist revolution, but also con-
sider that the foreign policy and interests of the So-
viet Union do not always coincide with the interets
of the Italian proletariat. They hold that Italy's neu-
trality is the best course in the struggle for peace in
the world, and oppose the division of the world into
blocs.
Despite the fact that the centrists are still depend-
ent on Nenni's Cominform group, their ideas arouse
the fears of the Party's leadership, because these have
met with response among the masses. Drastic measu-
res have therefore been taken against the centrists.
The centrist movement is undoubtedly strongest in
Northern Italy, where a paper, "Giorni Presenti" has
been started. This paper demands Italy's neutrality
in international combinations. The view that neutral-
ity best corresponds to the interests of the Italian
people and to the cause of socialism, has been set out
in the paper by Alberto Jacometti, one of the centrist
leaders. The Cominform leadership of the Party, head-
ed by Lizzadri and Marandi, has sharply condemned
this attitude, adhering to the view of unconditional
linking with the Eastern bloc. Although the line of
this paper has not yet been crystallized, although it
has not yet adopted a definte attitude to the leader-
ship of the PSI, the latter has forbidden its meMbers
to cooperate in it and has termed it a "Titoist" paper.
It is endeavouring to stifle with all means at its dis-
posal the very thought of the possibility of conduct-
ing an independent policy. But all these measures of
the Cominform leadership have failed to suppress the
rank and file's desire for independent policy, which
is the reason why the crisis in the Socialist Party of
Italy is growing more acute.
? 14 ?
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THROUGH THE FOG OF PROPAGANDA
HOW THE SOVIET UNION IS BEING
"STABBED IN THE BACK"
piBULGARIAN COLONEL, A-
leksandar Getman, gave the
Bulgarian Communist Party news-
paper, "Rabotnfoesko Delo", his
contribution to the list of Yugoslav
"Stabs in the back" to the Soviet
Union.
The article which enriches that
list bears the title "How Tito helped
Hitler and facilitated Churchill's
plans". It is illustrated, as we learn
from a Sofia radio boadcast of
October 16, by the facsimile of a
letter with the signature of Yugoslav
General Tempo sent to the com-
mander of the Bulgarian army on
the Kriva Palanka sector on October
7, 1944. Acording to the Sofia radio,
this letter contains the most import-
ant and the most convincing proof
of the assertions made by the
author in his article. This proof is
to be found in a sentence which
reads as follows.
"I am drawing your attention
to the fact that we will be
forced to defend our villages
with our own forces if your
army continues to plunder
them."
Here is the document, and a
written and signed document at that,
about the Yugoslav services to
Hitler and Churchill! Here are
proofs that Yugoslavia was, in
October 1944 ? concludes Colonel
Getman from this letter ? "Stab-
bing the glorious Soviet liberating
Army in the back."
We have so far been acquainted
with various ways in which the
Soviet Union has been stabbed in
the back. From the period of the
Yugoslav National Liberation Strug-
gle we know that the Yugoslav
leaders called it a stab in the back
when Yugoslav acts at that time
did not coincide with the Soviet ?
British "gentlemen's agreements"
about division of spheres of influ-
ence and specially with the Stalin
? Churchill bargain about the
division of spheres of influence in
Yugoslavia on a 50-50 basis. From
the present Cominform propaganda
we are again learning about another
form of back-stabbing which is
similar to that now being revealed
to us by Colonel Getman. It consists
of disagreement with the exploita-
tion of s mall socialist states by the
big "leading Socialist State". But
Colonel Getman succeeded in
drawing out the possibilities of this
criminal activity against the USSR
to an undreamed-of extent. The
Soviet Union, he tells us, can be
stabbed in the back not only by the
act of not agreeing, in peacetime, to
indirect exploitation, through joint
companies, for instance, but also by
preventing the plundering of one's
own villages by the Bulgarian
soldiers.
"Rabotni6esko Delo", which
published this article, agrees with
the opinion of Colonel Getman. The
Sofia radio also agrees and it broad-
cast this article. The only thing
we do not know is if this Bulgarian
appropriation of another's prerogo-
tive will be agreed to by ? the
foreign trade executives of the
Soviet Union.
I
LYA EHRENBURG, wrote an
article in the "Pravda" about
a subject which he really knows like
his abc's: hypocrisy and false
propaganda. The article is entitled
"Reproach" and it says that the
methods of Hitler and Goebbels did
not die with them and that they
are today serving those who are
drcaming about war.
This idea is a completely correct
one. Also correct is his observation
that the main trick being used by
the people today is ? false fear of
others. "The present instigators of
? 15 --
war", writes Ehrenburg, "in at-
tempting to justify the increase of
armaments, the bigger armies and
the large-scale war maneuvers, are
repeating Goebbels' words. Of
course, they talk only of defense.
But did Goebbels, Goerring and the
"Fuehrer" ever talk about anything
else?"
After this point, in order to avoid
having his readers in the Corn-
inform countries think even for a
moment that he is indulging in any
kind of double-talk, Ilya Ehren-
burg makes it clear who he is
referring to: "Aren't Mr. Truman
and his European sheriffs now
doing the same thing?", he asks.
There is a reason for the experi-
enced Ehrenburg's caution. If he
had not written this last sentence
his readers in the Cominform
countries could easily get the idea
that he was perfidiously alluding
to the leaders of their countries
and to Cominform propaganda.
Although such an idea by Ehren-
burg's readers would in any case
be a mistaken one, for it would ?be
hard to imagine that he would dare
to try to slip something like this
over, there would be a great deal
of truth in their first impression.
While Ehrenburg did not attack the
Cominform leaders, he must have
gotten the idea for his article from
their propaganda (because that is
the best place to get it). The words
of Cominform politicians, journalists
and other propagandists are such
a good illustration of his words on
the methods of war propaganda that
it would be hard to imagine better
ones. For a few months already,
the readers of the Cominform
newspapers and the listeners to
the programs of the Cominform
radio stations have 'been reading
and listening to this;
"There are secret agreements
between Wall Street and Tito. A
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THROUGH THE FOG OF PROPAGANDA
new axis is being forged for the
extermination of peaceful people."
(From the Moscow "Literaturnaya
Gazeta" of October 4th).
"In Yugoslavia every third men is
in military uniform." (Radio Sofia,
October 9th).
"Tito's clique is grinding its teeth
at us and making preparations
against us. It is making ready for
the disembarkation of American
troops in Yugoslavia." (Radio Bu-
dapest, October 26).
"Tito's regime is menacing our
borders." (From the Hungarian
newspaper "Nepszava", October
26).
And so on, day after day .
"Of course", as Ehrenburg says,
they all talk exclusively about
defense. But", to adhere to the
words of Ehrenburg, "did Goebb
Goerring and the "Fuehrer" ever
talk about anything else?"
THE VOTING ON TRYGVE LIE
was one of the more important
events in Flushing Meadows which
was not, as far as we could see,
accompanied in the Cominform press
by the compulsory conclusion that
Yugoslavia has gone over to the
imperialist camp. The non-exploit-
ation of such a wonderful motive
for that conclusion is all the
stranger since it was precisely the
Yugoslav delegate who proposed
that Trygve Lie should again be
elected Secretary-General of the
United Nations, and because he stood
by his opinion during the voting
when nine of the eleven Security
Council members voted for Lie.
Why did the Cominform let such
a wonderful chance go by? Here
is why: the Soviet delegate was not
alone. Of the two who did not vote
for Trygve Lie, apart from the
Soviet delegate, there was one who
abstained from voting and that
was ? the delegate from Chiang
Kai-shek's China.
The customary Cominform phrase
"birds of a feather flock toge-
ther" had to be omitted this time.
A similar fate was suffered by the
phrase on "camps". For otherwise
the confused Cominform newsmen
would be wondering how to explain
which one of the two had gone over
to whose camp: did Chiang Kai-
shek's China join the Cominform
camp or did the USSR go over to
the Kuomintang?
THE QUESTION OF WAR OR
PEACE with its neighbass
seems to have become a purely
internal matter for Italy. At least
that is what we learn from an
article written by the Italian Corn-
informist, Luigi Longo.
This Longo, as Central Commit-
tee Secretary of the Italian Com-
munist Party, published in the
Party newspaper "Unita" a declara-
tion by the leaders of the Italian
Communist Party on the country's
international position. The declara-
tion says that the only country in
Europe with whom Italy might go
to war is Yugoslavia. When the
Yugoslav Envoy in Rome answered
this declaration, describing it as
provocative, Longo launched a new
theory. He wrote the following in
the Party newspaper, word for
word: "The document of our Party
leadership provoked a statement by
the Yugoslav Minister in Rome,
Mr. Ivekovie. It seems impermissble
to us for this gentlemean to be
interfering in this manner in a
debate between Italian political
parties on Italian problems."
This new Cominform theory is,
undoubtedly, an original one. Only
if it were adopted by the non-
Cominform circles in the world,
what a lovely future for mankind!
Happily, they will not adopt it.
That they will not adopt it and
that it will remain the property of
the Cominform is proven by the
reaction of the delegations from
the majority of the countries in the
United Nations to the danger of
war. Many bad things and many
good ones can be said about these
reactions. But they do undoubtedly
show one thing, and that is that
the peoples of the world will not in
any case agree to Longo's Cominform
theories to the effect that the
? 16 -
question of who will war with
whom ? is the internal affair of
each individual country.
THE NEW DIVISION OF BUL-
GARIA was the subject of a
very exciting Communique by the
Tass Agency not long ago. This
communique was immediatly publi-
shed, acoompanied by indignant
commentaries, first by "Izvestia"
and "Literaturnaya Gazeta" and
then by the Itali-an newspapers
"Avanti" and "Paese", followed by
the rest of the newspapers and
radio stations of the Cominform.
The Soviet Agency communique
reads that the "Americans have of-
fered Tito half of Bulgaria."
The member of the Cominform
propaganda machine who thought
this one up is not a bad propagan-
dist. He knew that it would inevi-
tably cause indignation among all
followers of the policy of the Soviet
leaders. Not because someone is
presenting someone else with foreign
territory. Not because of that, for
this is only the right of the great.
But how dare a great power, Amer-
ica, divide up a country which
other big powers, the USSR and
Great Britain, have already divided
up among themselves. Since Stalin
and Churchill had already divided
Bulgaria up into spheres of interest
on an 80-20 basis in 1944, how
could Acheson be so bold as to
carry out a new division?
D. T.
Review of
INTERNATIONAL
AFFAIRS
Published twice a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices : International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103--906033.
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CPYRGHT
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25X1A
eview
I I ERN Aft 0 AL
AFFAIRS
VOL 1, NUMBER 11
BEOGRAD, OCTOBER 25, 1950
On United Nations Day (by Josip 13toz Tito)
FROM THE UN 0:
Authority of UN General Assembly Expanded
International Financing of Under-developed Countries
France and the Integration of Western Germany
EDITORIAL COMMENTS:
The USSR Against Collective Security
The Position of the Soviet Bloc on the Genocide Convention
A Propaganda Move by Eight Cominform Ministers in Prague
The UNICEF Before the General Assembly
The "Elections" in Eastern Germany
LIFE IN SOCIALIST YUGOSLAVIA:
Voters' Assemblies ? An Expression of Direct Democracy
LETTERS TO THE EDITOR:
On the Eve of Elections to the Congress
Economic and Financial Situation in Italy
EDITORS: DUSHAN TIMOTIYEV ICH AND ZDRAVKO PECHAR
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Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
Review of
INTERNATIONAL
AFFAIRS
THIS MAGAZINE IS A FREE FORUM
AND PUBLISHES THE OPINIONS OF
LOCAL AND FOREIGN WRITERS ON
VARIOUS PROBLEMS IN INTERNA-
TIONAL AFFAIRS
Issued Fortnightly
Published by:
THE FEDERATION OF YUGOSLAV
JOURNALISTS
Yearly subscription: $3, or 16 English Sh.
Telephones: 28-451, 26-715, Post Box 125
Checking account: Yugoslav National Bank
PR Serbia Branch Ng 103-906033,
Offices : International Affairs, Teraziye 31,
Belgrade.
CONTENTS:
ON UNITED NATIONS DAY . by Josip Broz Tito 3
Editorial Comments:
THE USSR AGAINST COLLEC-
TIVE SECURITY Joze Smole 4
THE POSITION OF THE SOVIET
BLOC ON THE GENOCIDE CON-
VENTION
THE PROPAGANDA MOVE BY
EIGHT COMINFORM MINISTERS
IN PRAGUE
THE UNICEF COMES UP FOR
DISCUSSION BEFORE THE GE-
NERAL ASSEMBLY
THE "ELECTIONS" IN EASTERN
GERMANY
LABOUR PARTY CONGRESS IN
MARGATE
From the UNO:
AUTHORITY OF UN GENERAL
ASSEMBLY EXPANED .....
INTERNATIONAL FINANCING
OF UNDERDEVELOPED COUN-
TRIES
FRANCE AND THE INTEGRATI-
DN OF WESTERN GERMANY
Life in Socialist Yugoslavia:
VOTERS' ASSEMBLIES ? AN
EXPRESSION OF DIRECT DE-
MOCRACY
5
6
7
7
8
. S. Primorac 9
Dragoslav Avramovich 11
Z. R. 12
Dr Leon Gershkovich
14
Letters to the Editor:
ON THE EVE OF ELECTIONS TO
THE CONGRESS . . . Ray Wilson 15
ECONOMIC AND FINANCIAL
SITUATION IN ITALY . B. Rafailovich 16
Contributors to this Issue:
Joie Smole, Yugoslav "Tanjug" news agency cor-
respondent in U. S. A. and contributor to the "Review
of International Affairs".
Dragoslav Avramovich, financial expert and yu-
goslav delegate to international monetary conferences
in Washington and Paris. Active contributor to
specialized economic periodicals.
Dr. Leon Gershkovich, Deputy-Chairman of the
Council for Legislation and Development of People's
Administration of the Yugoslav Government.
Boildar Rafailovich, Rome correspondent of the
Yugoslav "Tanjug" news agency.
Other Contributors: the Editorial Board and mem-
bers of the Federation of Yugoslav Journalists.
EVERY EVIL HAS ITS VIRTUE
The only ones who did not vote for
Trigve Lie in the Security Council were
the Soviet and the Kuomintang delegates.
? IT'S KIND OF NICE YOUR STILL BEING AROUND
("IeE" ? Beograd)
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VOL. 1, NUMBER 11
Review of
INTERNATIONAL
AFFAIRS
ON UNITED NATIONS DAV)
OCTOBEll 25, .195d
by Josip Broz Tito
THE entire world today trembles at the
thought that there might be a Third
World War and that is why the eyes of the peo-
ple of all lands are fixed on the United Nations
Organization. The question is will the United
Nations be able to prevent a new world war
and secure the peace, and how Will it be able
to do so? It must be admitted that this question
is being posed with a certain amount of scepti-
cism, which is justified if we take a quick glance
at the not far distant past ? for people com-
pare the events that preceded the Second
World War, including, unfortunately, the finale
of the League of Nations, which had a role
similar to that of the present United Nations
Organization, with phenomena that are occur-
ring now. In my opinion, however, one can
look with more assurance today at the future,
at the success of the mission of the United
Nations Organization, regardless of certain
shortcomings and weak points in it.
Recently, it has been a relief to see that res-
ponsible statesmen have drawn certain conclu-
sions from the unfortunate past and are now
more courageous in seeking ways and means to
make new aggression, a new world war, impos-
sible. The high cost of the experience of the
past, with all the consequences of the Second
World War, must serve us this time in the con-
sistent and persistent search for peaceful ways
to settle all international problems through the
new world organization, that is, through the U-
nited Nations. In order to? achieve this goal, we
must not only make the greatest effort but even
greater sacrifices, according to necessity, in or-
der to strengthen the United Nations as much
as possible so that it can be capable of eliminat-
ing the danger of war, which is again threaten-
ing mankind.
In Order to have the United Nations really
capable of fulfilling its great mission, it is ne-
cessary for that organization to be resolute and
determined in the face ?of any attempt ? re-
gardless of its source ? to menace the inde-
pendence of the peoples or to interfere in the
internal affairs of other states, big or small.
Finally, I should like to emphasize one thing,
and that is the existence of dangerous tendencies
to have all important international problems
settled only by a few big powers, meaning that
the representatives of other small and big mem-
ber-states of the United Nations are ignored in
the adoption of significant decisions which af-
fect other countries. Such a practice would also
threaten the existence of the United Nations
Organization itself, and peace would not be
saved that way at all. Only the full co-
operation of all members of the United Nations
on all questions and equality among them can
consolidate that organization and render it cap-
able of carrying out its mission, the mission
which the peoples of the world expect it to ful-
fil, and that is: to preserve peace in the world
and to solve all the still unsettled problems with
the greatest possible justice. In expressing this
wish, I am certain that it is the desire not only
of the peoples of Yugoslavia, but the peoples of
all lands.
I can underline again on this occasion that
the Government of the Federal People's Re-
public of Yugoslavia will support the preserv-
ation of peace with all its might. It will use
every opportunity to work for the consolidation
of the United Nations for it considers that it is
possible to save the peace and strengthen co-
operation among the peoples of the world only
through that organization.
1) This article appeared in the newspaper "Borba" on
October the 24th
? 3 ?
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EDITORIAL COMMENT
THE USSR AGAINST COLLECTIVE SECURITY
N his many sallies in the Poli-
t tical Committee, the chief of
the Soviet delegation, Mr. Vishinsky,
clearly supported the view that the
United Nations can oppose only such
acts of aggression against which are
opposed all the great powers. The
Soviet Union disputes the right of
UN to combat every act of aggres-
sion. An unconditional requisite for
UN action against an aggressor ?
according to the assertions of the
Soviet delegate ? is an endersement
by all the five great powers. In the
event of an obvious act of aggres-
sion, and in the absence of authori-
zation from all the great powers for
collective action against the aggres-
sor, the United Nations absolutely
must leave the victim of aggression
to the mercy of the aggressor. Such
is the essence of the Soviet delega-
tion's attitude.
Vishinsky has employed all his
rhetorical, juridical and political a-
bilities to knock over the premise
regarding unconditional action by
UN against any act of aggression, a
premise whose practical application
would be as follows: If the !`X" state
should attack the "Y" state, the UN
is bound to go into instant action
against the "X" state, that is, aga-
inst the aggressor, and in aid
of the "Y" state, namely the victim
of aggression. According to. the UN
Charter, action against the aggressor
should be instituted by the Security
C uncil. However, supposing the
Council is unable to do that. It is
unable to act that way because one
permanent member of the Council
supports the aggressor and vetoes all
decisions of the Security Council for
action against the aggressor. Would
the sixty members of the United
Nations be thus absolved from their
obligations with regard to the pre-
servation of peace? The General As-
sembly, in which the represent-
atives of sixty countries enjoy equal
rights, is bound to call at once for
collective action against the aggres-
(Report from New York)
sor and in aid of the victim of ag-
gression.
Vishinsky claims that the General
Assembly's call for collective action
against an aggressor would consti-
tute a crude violation of the Char-
ter, since it explicitly states that the
main responsibility for the mainten-
ance of peace rests with the Security
Council and, therefore, not with the
General Assembly. According to
Vishinsky's arguments, it would
appear that an act of aggression, as
long as it is supported by some great
power, does not constitute a
violation of the Charter, according
to the UN Charter, the great power
is entitted to use its veto in the
Security , Council regarding the
Council's decision for action against
the aggressor; the permanent
member of the Council has the right
to protect the aggressor; the Charter
allows the permanent member of
the Council to enable the aggressor
to achieve his goal.
How does this Soviet interpetation
of the Charter agree with its Article
Number One, which establishes that:
"UNO has the following objectives:
firstly, to preserve international
peace and security, and to that end to
undertake effective collective mea-
sures for the prevention of any
threats to peace, and for the suppres-
sion of acts of aggression and of
other violations of peace".
Why is the Soviet delegate so re-
solute in his stand against the very
notion of the Security Council's be-
ing bound to oppose unconditionally
every type of aggression? Why is he
especially against the adoption of
such measures which would afford
to peoples a certain guarantee that
the Security Council would in effect
oppose any act of aggression?
Or is the obligation of the Secu-
rity Council to resist unconditionally
any act of aggression perhaps con-
trary to the interests of world
peace?
Is the attitude of the Soviet de-
legation not giving rise to the ques-
tion: and what are the intentions of
the USSR?
In the Political Committee, the
proposal was debated that in the
event of an emergency, e. g. the
outbreak of aggression, the General
Assembly should at once be sum-
monned to meet within 24 hours in
an extraordinary session. The USSR
Foreign Minister Vishinsky opposed
this, asserting that 24 hours was too
short a notice and that the extra-
ordinary session of the General A-
ssembly could convene within 14
days. The Soviet delegation even
submitted a formal proposal to that
effect.
Why is the Soviet delegation aga-
inst an urgent summoning of the
General Assembly in the event of
aggression? Why does it ask that at
least a fortninght should be allowed
to elapse from the moment of the
outbreak of aggression until the ac-
tual convening of the General A3em-
bly?
Visinsky offered the following ex-
planation: "I may happen to be in
Azerbaijan. How am I to reach New
York in 24 hours? It cannot be done
by ordinary methods of conveyance
(railways and ships). It is even dif-
ficult to make such a trip by air...
Under such circumstances, therefore,
the extraordinary session of the Ge-
neral Assembly would present a
special composition. It might be
composed of the legitimate repre-
sentatives of states, but it would
certainly not be compsed of repre-
sentatives specially fitted for the
task, although the uncommon con-
ditions require specially prepared
and qualified representatives. I,
therefore, consider a fortnight to be
necessary for the meeting of the ex-
traordinary session of the General
Assembly".
Is this explanation of Vishinsky's
to be regarded as satisfactory? Let
us not overlook the fact that such
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EDITORIAL COMMENT
technical reasons are advanced by
the representative of a state having
a permanent multitudinous delega-
tion in the UNO headquarters.
In this connection, it is hard to
escape the question: what are the
intentions harboured by the Soviet
leadership if the latter's represent-
ative demands that the extraordi-
nary meeting of the General Assem-
bly be called only 14 days after
the act of aggression had been com-
mitted?
In all his sallies against the prin-
ciple of the United Nations being
bound to oppose any aggression, Vi-
shinsky has been advancing the the-
sis that the responsibility for world
peace rests solely with the great
powers and that world peace only
means peace between the great
powers. The General Assembly was
given an opportunity this time to
see with even greater clarity the
magnitude of the contempt in which
the vital interests and the role
of the small and medium countries
are held by the USSR, which
treats them like the property of the
one or the other great power.
Dealing with the declaration of
the representative of Cuba, who noted
the USSR's disregard of the role
of small nations in the maintenance
of peace, Vishinsky scornfully said:
"As to whether you, Cubans, exist
or do not exist, is of little concern
to us".
The Soviet Foreign Minister re-
iterated in the Political Committee
the thesis whereby the entire task
of the UN General Assembly regard-
ing world peace came down to se-
curing peace between the great
powers and for the great powers.
He rose against the General Asem-
bly's dealing with the question of
collective security, that question not
entering within the scope of the
great powers' policy. Instead of deal-
ing with the question, the General
Assembly should restrict itself to
appealing to the great powers to
institute negotiations outside the
UNO, to solve their mutual disputes
outside the UNO and to cope by them-
selves, without the participation
of other nations, with the problem
of world peace.
In putting forward this thesis, Vi-
shinsky, true enough, interpolated
an occasional reference to the
"equality of peoples". But what is
to be said about this "principled"
Soviet stand regarding respect for
the equality of peoples if it is view-
ed in the light of the over-all
Soviet stand toward the question of
world peace?
An analysis of Vishinsky's latest
speeches reveals that the Soviet de-
legation resolutely supports the prin-
ciple that the UNO has not been cre-
ated for the protection of an
indivisible world peace, but for the
protection of the interests of the
great powers, which dispose of the
veto for the purpose. It follows
then: should one great power find
aggression useful under a determin-
ate set of conditions, the United Na-
tions must not oppose such aggres-
sion since such opposition would in
that case be contrary to the interests
of determinate great powers, and the
fundamental task of UNO consists
of preserving the interests of the
great powers.
Joe SMOLE
The Position of the Soviet
Bloc on the Genocide
Convention
TWENTY-TWO states have so far
unreservedly ratified the Con-
vention on the Prevention and Pun-
ishment of the Crime of Genocide,
which was unanimously adopted at
the Third Session of the UN General
Assembly in Paris, 1948. It therefore
comes into effect, pursuant to Ar-
ticle 21, which is a successful ending
to the work on some exceptionally
important material from the field of
international criminal law. The UN
undertook this work almost five
years ago and since then the problem
has passed through various of its
organs. This is an international in-
struments which interests almost
everyone in the world, because it
provides for the prevention and
punishment of. one of the gravest
crimes against mankind.
The USSR, the Ukrainian SSR, the
Byelorussian SSR, Czechoslovakia
and Bulgaria ratified the Conven-
tion with reservations attached to
Article 9, which provides that the
International Court of Justice will
decide cases of dispute among the
contracting parties regarding the ap-
plication, interpretation or imple-
mentation of the Convention, which
includes the responsibility of states
on the question of genocide. It is
obvious that this Article of the Con-
vention is an essential part of the
whole. Without recognition of some
forum to decide such cases, the ap-
plication of the Convention would
be left to the arbitrary inclination
of each State so that it would, in
effcct, no longer guarantee effective
application. The question comes up,
then, of whether a Convention of
this sort has any meaning without
the foregoing clause.
By their reservation, the countries
of the Soviet bloc have taken up a
legally erroneous point of view to
the effect that such reservation is
permissible in view of the sovere-
ignty of the various states which
can. adopt whatever suits them in
any Convention. However, in inter-
national law today, the,point of view
prevails that there can be reser-
vations regarding multi-lateral inter-
national treaties only when they are
provided for explicitly by the treaty
itself, or, c they are recognized by
all the other signatories. This point
of view was supported by Soviet le-
gal science, too, until recently. Sta-
tes are sovereign insofar as they
can decide whether or not to ratify
a treaty, but they cannot consider
that they have ratified it if they
place unilateral reservations on it.
The UN Commission on Inter-
national Law adopted this point of
view at its last session in July this
year, in Geneva.
The Soviet bloc states have not,
therefore, really adopted the Con-
vention on Genocide which is, apart
5
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EDITORIAL COMMENT
from the Nuremberg principles, one
of the most progressive achieve-
ments of international criminal law
so far. The question comes up of
why they did this.
The reply must be sought in the
earlier stand of the USSR on this
Convention and in certain political
and social facts about the USSR. As
regards the adoption of this Con-
vention, the USSR had a very irre-
solute stand up to the spring of 1948,
suggesting constant postponements
and further study. When it decided
in favor of the Convention in prin-
ciple, the USSR brought forward,
apart from certain progressive pro-
rosals, various recommendations
which tended to narrow the scope
of the Convention. For instance, it
sought that the concept of genocide
be connected exclusively with Na-
zism and fascism, although it is a
fact that this crime emerged on the
scene even before fascism, and that
it exists even today. It also sought
that the resettlement of national and
ethnical groups should not be quali-
fied as genocide by the Convention
(and it was not included), and that
the forcible resettlement of the
children of one group with another
should also not be included (which
it was, however). The Soviet Union
also asked that the Convention
should give no special protection to
religious groups although it is a
well-known fact that it is precisely
such groups that have often been
subjected to horrible persecution and
extermination.
At the Fourth General Assembly
Se sion, the delegate from Great
Britain brought out the cases of for-
cible resettlement of entire nations
in the USSR, pointing out the geno-
cidal character of such acts. If we
add to this cases of persecution of
people belonging to the nationalities
of Yugoslavia in the Cominform
countries, the forcible detention of
our children in the USSR, and simi-
lar things, all of which are acts
bordering on genocidal tendencies at
the very least, then it becomes clear
why the Soviet Union and the coun-
tries of the Soviet bloc did not real-
ly want to become parties to the
Convention on Genocide.
A Propaganda Move by
Eight Cominform Ministers
in Prague
UDGING by all appearances,
J the sudden conference of the
Cominform Foreign Ministers, which
was also attended by the East-Ger-
man Foreign Secretary as an equal
partner, was hardly confronted by
a complicated task as it convened in
Prague on the 20th and 21st of this
month. The conference adopted a re-
solution which, in a manner of
speaking, represented a retort to
the decisions on the remilitarization
of Germany of the New York meet-
ing of Foreign Ministers of the three
Western Powers, on September 21st
'this year.
All the circumstances surrounding
this conference point to its demon-
strative character rather than to
its constituting any serious contri-
bution toward the solution of the
German problem. In order, however,
to secure the maximum amount of
publicity and to produce the neces-
sary effect abroad, the orga-
nisers of the conference took pains
to shroud it in mystery, using such
stunts as the ban on the landing of
foreign airplanes on the Prague ae-
rodrome, and diverse other "precau-
tions", during the stay of the
Soviet and of the satellite mini-
sters in Prague.
As for the resolution of the eight
Cominform ministers itself, it realy
amounts to no more than a compi-
lation of the declaration of the mi-
nisters of East-European countries
made at their June 1948 session in
Warsaw. Only, at that time the issue
of the creation of a West-German
State was involved, i. e. it was a hit-
back at the London conference of
the foreign ministers of the three
Western Powers, whereas now the
underlying motive is the remilita-
rization of Western Germany, that
is, the New York decision of those
same three Powers. In spite of the
routine phrases on the pattern of
the Stockholm Appeal, the current
declaration is far more guarded than
its Warsaw predecessor. Its tone
was undoubtedly influenced by the
events in Korea, in the shadow of
which the entire Soviet policy is
momentarily unfolding.
The Prague resolution, however,
viewed from the Soviet angle, has
a sense of its own. The Soviets, by
interposing a declarative condemn-
ation of the remilitarization of
Germany, needed to conceal their
own present and future militariza-
tion measures in Eastern Germany,
which measures, viewed realistically,
are not a whit lesser in scope than
those in the West.
In addition to its other designation,
an armed Eastern Germany is to
serve the USSR for internal uses as
well. That is to say, even in the e-
vent of a withdrawal of Soviet
troops from Germany ? Poland and
Czechoslovakia would be much easier
kept within the orbit of the
"iirotherly Cominform countries"
with an armed Eastern Germany
ranged alongside, than would other-
wise be the case.
Notwithstanding the obvious So-
viet non-adherance to the Allies's
decisions on Germany and non-ma-
nifestation of a desire for the con-
clusion of the peace treaty in con-
cert with them, the Prague -reso-
lution proclaims the decisions made
in New York as unlawful, at cross-
purposes with the Potsdam Agree-
ment, and makes the three West-
ern Powers responsible for the non-
conclusion of the peace treaty with
Germany.
The closing sentence of the Pra-
gue resolution reveals best its pro-
paganda character. It says that "the
eight signatory-nations shall do all
within their power to facilitate the
solving of the pressing task ? the
reaching of a treaty of peace and
of Germany's union". The resolution
actually contains no tangible pro-
posal to that effect, nor is there any
expression of goodwill. On the con-
trary, all of its eleven pages radiate
only propaganda and nothing else.
It takes more than such and similar
resolutions, therefore, to bring about
a solution of international problems.
It takes tangible proposals and agree-
ments, preceded by the necessary
manifestations of goodwill.
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EDITORIAL COMMENT
Ther41;UNICEF Comes up for
Discussion Before the
General Assembly
DAILY assistance in food and
health services for 8 million
children and TBC vaccination of 10
million children in 54 countries of
Europe, Asia and Latin America ?
that in one sentence are the results
of the humanitarian activities of the
International Children's Emergency
Fund during the three years of its
existence. Undoubtedly these are ac-
tivities which more than any other
contributed towards strengthening
and developing cooperation among
peoples.
However, perhaps because of the
very nature of this success, efforts
are now being renewed from several
sides to liquidate the Fund.
The attitude of the so-called coun-
tries of socialism and people's de-
mocracy towards the humanitarian
activities of the UNICEF deserves to
be mentioned first because of its
absurdity. The Soviet Union has so
far not contributed a single penny
of the 148 milion dollars turned over
to the Fund by the governments of
(3 states, including private dona-
tions. Similarly the USSR has not
sent one single pound of the 225,000
tons of food and several thou-
sand tons of footwear, clothes, sa-
nitary material and milk processing
installal,ions contributed by 35 coun-
tries. And not only that, but from
the end of September this year, the
Soviet and Eastern European repre-
sentatives boycotted all the sessions
and meetings of the International
Children's Emergency Fund, alleged-
ly because the Kuomintang delegate
was present at them, although the
UNICEF's work also extends to the
People's Republic of China, for which
it approved the sum of 2 million
dollars this year. The work of the
Fund has also been obstructed in
Eastern Germany, Bulgaria and Ru-
mania.
The policy of the Soviet bloc to-
wards the International Children's E-
mergency Fund not only badly
reduced its efficacity but also pro-
vided a powerful support to all
those who this year again attempted
to complicate the structure of the
Fund by proposing technical assist-
ance instead of direct aid in kind,
and who endeavoured to restrict the
UNICEF's action by transferring its
finances to the UNO's budget. It is
regrettable that a proposal to this
effect came from the USA, which
contributed comparatively the most
to the success of the Fund and for
which this contribution is a propor-
tionally small expenditure in com-
parison with the benefits it offers
to other countries.
However, these proposals once
again, as they had done in the past,
encountered the powerful resistance
and condemnation of small and med-
ium countries which were in favour
of the UNICEF continuing its work
on the basis of extending concrete
material assistance. The Australian
Resolution and the Yugoslav amend-
ments submitted in this respect, won
the support of the Asian countries
in the first place of India, Indone-
sia and Pakistan. Despite open and
concealed opposition the above pro-
posals were adopted by the Social
Committee and will undoubtedly be
approved by the General Assembly
Plenum as well.
THE POLISH DELEGATE
TO UNO.
; ./
... SNAPPED IN THE ACT OF ARTICU-
LATING THE WORD: YUGOSLAVIA
? Beograd)
The "Elections" in Eastern
Germany
ON October 15 elections were held
in Eastern Germany whose
purpose was to accord retrospective
confirmation to the Provisional Na-
tional Assembly and the East Ger-
man Government. These elections
were due to be held as far back
as October 1949 under the consti-
tution. At that time they were p3st-
poned for a whole year. The elec-
tions, therefore, had not taken place
at a time prescribed by the consti-
tution, but when it suited the govern-
ment to do so.
Contrary to the 1946 ballot, at this
year's elections the existing politi-
cal parties in the Eeastern Zone did
not have their separate lists of can-
didates. Imposed was one exclus;ve
list, namely, the list of the so-called
National Front. The phenomenon,
however, amounted to a further vio-
lation of the constitution of the East
Zone (Article 51 of the constitution
explicitly provides that the elections
must be carried out in accordance
with the election right by
proportion) and at the same time
represented an artificial mea-
sure far removed from the present-
day social structure of Eeastorn
Germany. In the Eastern Zone of
Germany, where the major portion
of economy is still in the hands of
private capitalists and where only
those large estates which exceed
100 hectares in area have been split
up, and where, moreover, no revo-
lution of any sort had taken place,
the "National Front" in no case ex-
presses the will of the people. The
setting up of a single list of can-
didates therefore plainly stands out
as artificality engineered from
above.
Due to this it had become neces-
sary to resort to different expedients
to groom the populace for the single
list idea. The eve of the elections
was marked by thorough purgings not
only inside the United Socialist Par-
ty but also in the Christian-Democ-
ratic Union and the Liberal-Democ-
ratic Party. The object of the pur-
ges indubitably was to stir up un-
easiness and fear among the popu-
lation, which is precisely what the
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tbiTORIAL COMMENT
leading bureaucrats and their Soviet
masters needed so as to secure fa-
vourable election results for them-
selves. The same purpose was serv-
ed by the widespread campaign for
the so-called "alertness", which was
specially intensified just prior to the
actual voting.
Other measures were also syn-
cronized to "win over" the popu-
lation. Some weeks before the elec-
tions different laws were enacted
which would merit warm acclaim ?
had they not been so overtly design-
ed to corrupt the population. Thus,
there was launched the legislation
on the granting of credits to small
farmers, as well as on the disbur-
sement of dues to incapacitated indi-
viduals under old claims. However,
imnaediatelly after the publication
of such laws ? and even during the
relative debate in the East German
Parliament ? it was persistently
emphasised that those standing to
benefit from now on by such conces-
sions had the duty of expressing
their gratitude on October 15th by
casting their votes for the "National
Front".
The story did not end there, how-
ever. A few days before the elec-
tions a campaign was staged favour-
ing public ballot. This campaign
was encouraged in a declaration by
the State Secretary for Home Af-
fairs, Herbert Varnke. With the dis-
carding of the secret ballot even the
last democratic mask had been scrap-
ped, and it must not be over-
looked ? for the sake of a complete
picture ? that the candidates of the
"National Front" were not proposed
for election at voters' rallies, but
were the product of inter-fractional
agreements between party leader-
ships, which adhered to a determi-
nate key in effecting the operation.
The postponement of the elections,
the imposing of an artificial unified
list, the "purges" and corrupt elec-
tion practices, the undemocratic
method of nominations and the
abandonment of the secret ballot ?
those were the features of the elec-
tions, which the Deputy Premier,
Walter Ulbricht, characterized as
the first democratic elections in
German history".
Labour Party Congress
in Mar gate
THE Labour Party Congress was
held in Margate from October
2 to 6, 1949. The February elections
this year considerably reduced the
strength of the Labour Party in
Parliament where it has recently
had a majority of only 5 to 6 votes.
Despite hints of differences inside
the Party itself on questions of na-
tionalization and the new elections,
which were particularly emphasized
by the Conservatives, the Labour
Party Congress in Margate demon-
strated considerable unanimity on
all questions and there was no org-
an'zed oppostion at the Congress
whatsoever. It was noticeable, how-
ever, that the popularity of the left
wing of the Party had been growing
constantly since 1945. The mebers of
the "keep left" group, Jan Mikardo
and Barbara Castle, were elected to
the new Executive Committee while
Aneurin Bevan, the leader of that
wing, received the greatest support
from the delegates to the Congress.
At the conference, he himself under-
lined the unity of the Party, saying:
"We will come out before the British
people in the general elections as a
united party ? and I am saying that
intentionally".
That unity was demonstrated
during the consideration of ques-
tions of foreign policy and espe-
cialy in the discussion on the pro-
gram declaration which bears the
title: "Labour and the New Socie-
ty".
The discussion of foreign policy
was rather lively. President Sam
Watson took part as did Minister of
Defense Shinwell and Minister of
Foreign Affairs Bevin who flew to
the Congress from the United Nations
Assembly. It was apparaent that
Bevin had never had so much sup-
port for his policy within the Party
itself as he had this time.
The greatest unity was manifest-
ed in the discussion on the program,
"Labour and the New Society". Ans-
wering the objections that the pro-
gram did not contain any concrete
measures regarding nationalization,
as had been the case since 1946, Mor-
rison stated that this intention had
not been abandoned but that the si-
tuation at this particular moment
was not a suitable one for the adop-
tion of such decisions. He emphasiz-
ed that the program contained prin-
ciples and not concrete measures.
The program "Labour and the New
Society" was adopted unanimously
after the speech delivered by Health
Minister Bevan, who came out in
support of economic assistance for
undeveloped countries and brought
out the services of the Labour Party
in that field.
As far as economic policy was
concerned, the conference did not
bring out any new points while dis-
cussion itself mainly emphasized the
successes which had been achieved
by the Labour Government. The dif-
ficulties of the new defense program
were underlined and a thesis already
put forward by the Trade Union
Congress was repeated ? that it was
necessary to curb profits and thus
to find a source of funds for arma-
ments without undertaking to res-
trict wages. The Conservatives
reacted sharply to this both through
the press and at their own congress
which was held shortly after the
Congress in Margate.
The Congress in Margate, like the
Conservative Congress in Blackpool,
showed that the Labourites and the
Conservatives agree on the funda-
mental issues of foreign policy and
that the main battle at the coming
elections would center around prob-
lems of internal policy like wages,
prices, profits, nationalization, etc.
The Congresses showed that the La-
bourites and the Conservatives are
both aware of the fact that the
workers represent the main mass of
the voters for whose support they
must fight at the coming elections.
As theParty in power, the Labourites
were forced to make their promises
to the working class as regards wages
and improved conditions within
realizable proportions, while the Con-
servatives had a better opportunity
to make more boastful promises the
achievement of which it is hard to
talk about now, especially when
Great Britain is faced with an ex-
tensive armaments program.
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FRO1V1 THE UNO
AUTHORITY OF UN GENERAL ASSEMBLY
EXPANDED
THE events in Korea have given new life
to the discussion of the ways and means
to be used by the United Nations in combat-
ting aggression, or rather, in consolidating
peace and international cooperation. In the
course of these discussions, more and more
attention is being paid to the role of the
Security Council and the General Assembly
or, to put it more accurately, to the distribution
of duties and responsibilities between these two
bodies in accomplishing the main aim of the
Organization.
The special position of the five big powers
(USA, USSR, Great Britain, France, China)
gives this discussion its political substance.
Otherwise, the entire matter would be reduced
to a more or less technical level and would not
attract so much attention in the world. The fact
alone that the Security Counccil can, in case of
immediate danger of war or if war has al-
ready broken out, make binding decisions (in
contrast to the General Assembly which can
only make proposals) would not give these dis-
cussions such great significance. A proposal to
undertake military measures against an ag-
gressor which is voted for unanimously, or with
a majority, would certainly not have less effect
than a binding decision of the Council.
The special position of the big powers in
the UNO is expressed primarily in the fact
that, acording to the Charter, each decision of
the Security Council must be voted for by
seven members (of a total number of eleven),
with the condition that all the five big powers
also voted for the decision. This practically
means that each one of the five big powers can
prevent the adoption of any Security Council
decision. The only exception to this rule are
procedural decisions.
The position of the Soviet Union to the
effect that the function of maintaining the
peace is the exclusive task of the Security
Council has, therefore, no other aim than to
keep its privilege as a big power at any cost,
or to extend it beyond the point ?provided for
by the Charter.
In presenting their point of view, the Soviet
representatives always insist pathetically on
adhering to the letter of the Charter and res-
pecting Law. Regardless of the fact that the
Soviet Union's attitude toward other countries
9
(toward Yugoslavia, for example) is .not in
accordance with the principles and provisions
of the Charter, however, its attitude toward
the question of the veto is also not in harmony
with the provisions of the Charter.
Shortly after the Security Council began
working, the USSR and the other big powers
concluded an agreement that abstention from
voting by one big power would not be an
obstacle in the way of considering a proposal
legally adopted, if the necessary majority of
seven had voted for it. This agreement had
been applied in practice many times, although
it is obvious that it is not in accordance with
the Charter. Article 27 of the Charter .explicit-
ly requires that the five permanent members
of the Council must vote for a decision, while
abstaining from voting is clearly not the same
thing as voting for a proposal.
The stand of the Soviet Government then,
like its stand in the present discussions, cis
evidently based on reasons which have no
connection with keeping the Charter sacred.
Departing in one sense from a doubtlessly in-
flexible provision of the Charter has led to a
transformation of the "rule of unanimity" to
the "right of veto". Instead of the obligation
of unanimity on the part of the permanent
members, we have the right to obstruct
a decision by a negative vote ? the veto.
This has created a situation whereby one
big power can stop a decision, should it wish
to do so. On the other hand, it can allow a
decision to be made while washing its hands
of all moral responsibility for its adoption and
implementation.
Simultaneously, the insistence of the Soviet
Union on extending its veto right in the Secu-
rity Council to the right of veto on all questions
relating to the maintenance of peace in general
does not issue from the deisre to achieve joint
responsibility and unanimous cooperation a-
mong the big powers. It is rather the result of
a tendency to impose upon the entire Organi-
zation of the United Nations the -obligation ,of
stopping ,every action if it is not in accordance
with the will of a big power, concretely, the
Soviet Union.
However, changing the topic of discussion
and talking about .obedience to the letter of the
Law is merely an attempt to evade political
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PROM TI-It UNO
discussion of how the United Nations can
fulfill its main task, the presservation of peace.
In talking about this, the Soviet Union presents
a simple formula to the effect that peace can be
based only on the agreement of the big powers.
Fortunately, this formula is not an accurate
one, for if it were, the Third World War would
already have been in full swing. Even in San
Francisco in 1945, the founders of the Charter
were not so naive as to think that the relations
among the big powers in the future would be
replete with idyllic harmony and unanimity.
The provision on the unanimity of the big
powers in the Security Council was included
in the Charter precisely because of mutual dis-
trust as to the good intentions of the big powers.
It was formulated at a time when the relations
between the USSR, on the one hand, and the
USA, on the other, had already shown that there
was a whole series of fundamental points of
disagreement in the post-war period.
The founders of the Charter, including the
representatives of the USSR, introduced the
provision on the unanimity of the big powers
in the Security Council into the Charter precise-
ly because they were fully aware of the nec-
essity to settle misunderstandings and disputes
peacefully. In this way, the big powers under-
took the obligation to come to an understanding
and to insure one another against abuses. In
other words, each one of the big powers tried
to insure itself against the application of
forcible measures by special authorization of
the Security Council, which a bloc made up of
the remaining four powers could undertake.
Experience has shown, however, that at least
one of the 1945 presumptions was not correct,
that is, that all the states, and especially the
big powers, would always try to settle all dis-
puted questions within the scope of the
United Nations, meaning that they would con-
stantly be cooperating through the Security
Council. The Soviet boycott of the Security
Council this year showed that clearly.
It is obvious that the United Nations in such
a situation, if they wish to fulfil their funda-
mental task ? the maintenance of peace, must
provide for measures which will make it pos-
sible to undertake action against aggression re-
gardless of the ability or inability of the Se-
curity Council to play the role assigned to it
by the Charter.
The experience of Korea has shown that it
is an altogether improbable thing today that
a war begun in any spot in the world will
remain isolated for long. The conflict in Korea
has further demonstrated that passive waiting
for the five big powers to come to an under-
standing and undertake measures to stop the
war can only lead to a deterioration of the
situation to such an extent that no action by
the UN will be able to stop the spreading of
war.
The alternatives facing the UN may be for-
mulated in the following way: either to permit
war to spread in case the big powers do not
agree, or, to mobilize the authority of the UN
by immediate discussion of the dispute before
all UN membres publicly, in front of the entire
world.
The UN has chosen the second solution with
the support of the great majority of members
in the organization that the question of war or
peace cannot be regarded merely as a question
of agreement between the big powers, because
if such an agreement should fall through that
fact might involve the whole world in the hor-
rors of a new world war.
The most recent decisions of the General
Assembly have undoubtedly increased the res-
ponsibility and role of the Assembly. In the
future, it will have a more important role in
the preservation of peace than was foreseen in
1945 in San Francisco. However, this evolution
in the Organization's method of work can only
contribute to the consolidation of its authority.
It is based on the active participation of all
member-States in the struggle against aggres-
sions.
The question comes up as to the extent to
which the General Assembly could act effective-
ly in case of a dispute among the big powers,
or between a big power and a smaller state.
Before answering this question, it is necessary
to insert a word of caution to the effect that ac-
tually the only thing left after that is action by
the General Assembly, unless the victim is to
surrender to his fate peacefully. Regardless of
that, however, the discussion of disputes in the
General Assembly and the action of the great
majority of the member-States represents such
a moral and material force that any potential
aggressor will keep it well in mind.
Actually, experience so far has shown that
the activity of the United Nations, even after
conflict had broken out, could force a big power,
which was actively supporting aggression, to
return to the table of the United Nations. There-
fore, the theory that the decisions of the ma-
jority are not valid for the big powers has been
shown up as inaccurate, and therein lies a
guarantee for the effective functioning of the
General Assembly of the United Nations in
preventing aggression.
S. PRIMORAC
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International Financing of Under-developed
Countries
MONG the various subjects considered at this
year's session of the UNO General Assembly,
the question of development of under-developed
countries has been claiming the attention of the
delegates, and, in this connection, the possibility of
increased participation of the UNQ and its special-
ized agencies in the financing of the project has also
been a subject of study. This complex of questions
has been a highlight also of the Fifth Regular Session
of the International Bank for Development and
Reconstruction, held in Paris during the first half of
September of this year. Similarly, at the August
meeting of the Economic-Social Council of the United
Nations, the economically under-developed countries
took advantage of the discussion concerning the main-
tenance of full employment(') to underline the close
relationship existing between the low degree of
development of productive forces and insufficient
employment (or? hidden unemployment) which occurs
and remains a constant phenomenon in such coun-
tries as their specific structural feature, independently
from the rise and fall of unemployment caused by
the movements of the economic cycles.
The increasing emphasis of this problem in UNO
and its specialized agencies is certainly not due to
chance. It is, on the one hand, the outcome of a
comprehensible and justified desire and struggle of
the masses of the people in the under-developed
countries for a maximum growth of the pace of
economic development, as reflected in the concreti-
zation of major capital inwstment projects, the ratio-
nal exploitatin of their productive resources and
the tendency for the liquidation of technical back-
wardness, as a heritage of the imperialistic exploit-
ation of such countries ? a desire and struggle which
inevitably arose in the present phase of world social
development. It is the consequence, on the other
hand, of the clear recognition of the fact by world
public opinion that a proper development of the
international economic and political cooperation stipu-
lates the provision of full assistance and scope to
under-developed countries, which would enable them,
by fostering their national economy, to ensure a more
dignified living standard for their populations, and
to appear in international trade as equal partners.
Apart from this, the complete upheaval in world
economic relations caused by the uneven character
of world economic development, which assumed parti-
cularly acute forms during and 'after, the Second
World War, has been imposing as an imperative, and
still does so, the various efforts ail-Ming at the establish-
ment of a bearable degree of equilibrium through
an accelerated development of the productive forces
existing in under-developed countries.
There are two ways for the attainment of eco-
nomic improvements in under-developed countries:
with the aid of foreign credits, or without it. Its
carrying out without foreign credits would involve
the employment of native resources for the financing
of the high level of capital investments necessary in
(1) National and International Measures for Full
Employment, Aericirt by a Group of Experts Appointed by
the Secretary?General, Lake Saccess, December 1949.
order to overcome the process as rapidly as possible.
In a practical sense, this would require a limitation
of individual consumption, which might retain a
relative character in so far as there should ensue a
simultaneous corresponding increase in the net na-
tional income, i. e. an increase in domestic production,
so as to offset the higher utilisation of assets needed
for capital projects. The limitation of individual
consumption, however, may also be of an absolute
character if the net national output should have
retained the same volume or if it should have gone
up, even if to a lesser extent, when compared with
the increased outlays of capital. Considering that the
given degree of deveolpment of the productive forces
often precludes a sufficient stepping up of the net
national income, considering, furthermore, that the
monetary reserves of undeveloped countries are either
too low or non-liquid (e g. the sterling claims of the
British colonies and dominions) as to secure the neces-
sary increase of the social product through an export
surplus?it clearly follows that the implementation of
the investment programme in such cases inevitably
affects the level of consumption in an economically
undeveloped country, and might even lead to even-
tual upheavals in the latter's monetary stability.
Foreign financing of the investment programme,
e. g. the relative contribution to the domestic efforts
of a poorly developed country, may in some measure
alleviate the difficulties faced by the present genera-
tions and spread part of the industrialisation burden
over a later period, when the development attained
in between by the productive forces will have exerted
its positive influence on the final formation of the
payments balance of the country , in question. The
only question which might be posed here concerns
the terms on which foreign financing would be
effected, terms which would on the one hand have to
ensure the repayment of the credits advanced, and,
on the other, would constitute a guarantee to the
effect that the recipt of such assets would be in full
accord with the political and economic interests of
the receiving country.
The financing by international financial agencies
indubitably presents considerable advantages as
against financing by the national governments, and
incomparable advantages over other forms of world
capital movement. The advancing of aid by special-
ized international agencies ? on principles laid down
in the foundations of UNO ? should constitute a
simultaneous guarantee for the poorly developed
countries that the financial aid would be extended in
the spirit of true international cooperation, and with
due respect for the economic independence and liberty
of the receiving country. Such financing could, fur-
ther, ensure the harmonious expansion of all economic
branches and, thereby, avoid a parallel neglect of the
one and the hypertrophy of the other branch of eco-
nomic activity, which might arise if the economy of
one country is not viewed as an entirety, and the
financing conducted instead on the basis of selection
of particular investment possibilities. In a practical
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sense, such selection might mean the deformation of
the entire economic development of a poorly developed
country and actually foil the final objective desired:
the raising of the economy of the poorly developed
country as a whole for the improvement of the living
standard of its population and an augmentation of
the volume of international commodity exchanges.
This does not imply that the feature of "specific
projects" does not arise in a far more overwhelming
degree also in the financing by international organi-
zations; it only means that the feature is not typical
to this mode of financing and that it may be removed
in the process of serious economic analysis of the
over-all investments programme and by a proper
appraisal of the future economic structure and the
payments balance of the under-developed country.
The International Bank for Development and Re-
construction is for the time being a specialized agency
of the United Nations devoted to international
financig. Its activites to date in assisting the develop-
ment of the productive forces of under-developed
countries have not fulfilled all expectations, especially
not in the initial phase of its operation. From the
beginning of its operations (in 1947) until September
1950, the bank has granted a total of 965 million dollars
in loans, of which only about 310 million dollars went
to meet the needs of the under-developed countries
(Brazil 90 millions, India 62.5 millions, Mexico 60.1
millions, Urugay 33 millions, Turkey 16.4 millions,
Chile 16 millions, Iraq 12.8 millions, El Salvador 12.5
millions, Colombia 5 millions, Yugoslavia ? a timber
loan of 2.7 million dollars), and over 400 million dollars
including the 100 million dollar loan granted to
Australia in August 1950. The bank's activity in this
field has been concentrated on Latin America. The
needs of the Middle and Near East, Africa, the under-
developed areas of Europe ? were almost neglected.
Its policy was directed toward the financing of spe-
cific projects, and only the loan to Australia had been
granted for the financing of the over-all economic
development of that country. However, the bank's
administration displays of late a greater understand-
ing of the needs of under-developed countries, although
it is very problematic as to whether the business
principles so far applied, its organization and available
assets would permit such essential expansion of the
bank's activities which would suffice to meet at least
the minimum requirements of the under-developed
countries. In this connection, the question of reorgan-
ization of the bank's operations by means of an
intensified enlisting of the national governments in
the collection of assets, and enhanced participation
by UNO in the distribution of such assets, has been
raised with ever-increasing frequency recently. Pro-
posals have even been advanced for the creation of a
separate international institution (UNEDA ? United
Nations Economic Development Administration) to
cope with the financing of economically under-
developed countries in such cases where the procure-
ment of foreign loans from other sources proves
impossible. Regardless of the final form to be adopted
for the extension of economic assistance to under-
developed countries, this question has clearly assumed
central importance in the present international hap-
penings, which makes an intensified interest and
enlistment of the international community in this
field inevitable.
Dragoslav AVRAMOVIC
FRANCE AND THE INTE-
GRATION OF WESTERN
GERMANY
THE tendency toward the economic merging of
Western Europe into a unified economy with a
unified market has particularly come to the fore
towards the end of 1948 in the plans set up by the
representatives of the European Economic Adminis-
tration (EEA) and of the Organization for European
Economic Cooperation (OEEC). By their political
substance, these plans were designed to transform
Western Europe into a unified economic and military-
political force, which, under the conditions of a policy
of blocs, would strengthen the Western positions in
the cold war with USSR.
The establishment of a united Western Europe,
which is hindered by very powerful and mutually
conflicting interests of the Western countries, is influ-
enced not only by active American efforts but also
by the policy of the USSR which has led to a miti-
gation and suppression of West European contra-
dictions, and to the reinforcement of the need for
united resistance to that policy. For a united Western
Europe is possible only as long as there exists an
integrated Eastern Europe wherein the USSR holds
all the key positions. This means that the USSR
policy in Eastern Europe, as well as its policy on the
world plane, is the direct cause of the strengthening
of reactionary forces in Western Europe.
Among all the countries of Western Europe the
most convincing example in that direction is provided
by the France of today. And this is by no means
accidental. From a political standpoint, France re-
presents the pith and marrow of Western Europe. A
solution of the question of Western Europe is impos-
sible without the participation of France. For that
reason the U. S. efforts for the creation of a unified
Western Europe have mainly centred, in their initial
phase, on the salvage and consolidation of the posit-
ions of the Franch ruling circles.
There was no need for the Americans to subdue
the Franch capitalists. What is more, to Franch banks
and industrialists who are closely attached to Amer-
ican monrpolies through various links they extended
economic and political assistance to enable France,
despite her weakening after the Second World War,
to retain, even if partly, her pre-war positions.
Precisely that was the determining factor of
France's attitude towards the plans for the integration
of Western Europe. Whilst the British capital clashed
with the American in different Parts of the world,
the French capitalists found in their reliance and
dependence on American capital not only the neces-
sary concrete help for the strengthening of their
positions inside France, and for solving the problem
of retaining power, but also a means for the stabilisa-
tion of their economic and political positions abroad,
which had been shaken during and after the Second
World War.
It came to close French-U. S. A. cooperation, first
under the Marshall Plan, and then in all the other
bodies as well, whose aim was the integration of
Western Europe. Whereas Great Britain, protecting
above all else her imperial interest and defending
herself from American capital, enters with great re-
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luctance into certain American combinations aiming
at the economic integration of Western Europe, France
is becoming almost the principal exponent of Amer-
rican policy in Western Europe.
This is a fact of indubitable magnitude in the
present political situation and it enables the U. S. A.
to pursue effectively its political and military stra-
tegy. Coupled with this is the fact that American po-
licy has yielded enough positive results in the present
phase of West-European development. Out of the
over-all American aid to foreign countries, which, in
1949, amounted to some six billion dollars, almost 70
per cent, were allocated to Western Europe. The
outcome has been a substantial increase in industrial
production in the main West European countries. In
the first quarter of 1950, the volume of industrial pro-
duction exceeded by 23 per cent. the pre-war level,
and a 22 per cent. increase on the pre-war figure
was recorded in the second quarter of this year. Ac-
cording to oficial statements, the dollar deficit has
declined and there has been an increase in gold re-
serves. American sources state that this year has also
seen a drop in American exports to the countries of
Western Europe, and an increase in the latter's ship-
ments to U. S. A.
France has drawn indubitable benefits from this
consolidation of Western Europe's economic situation.
Only, both for France and for Western Europe, the
benefits are of a passing nature. The armaments race,
the burden of which will be borne only in part by
the U. S. while the balance, probably the major por-
tion, by the other West European states, will eli-
minate the benefits experienced by the nations of
Western Europe from such consolidation. The ap-
propriation for armaments in the French 1951 budget
is estimated at 650,000 million francs, which is more
than half of all the expenditure for civilian purposes.
Added to this is the jump in the world raw material
prices, which has occurred since the outbreak of the
war in Korea, and which has again led to infla-
tionary tendencies in France.
This instability in Western European economic
consolidation stems from the fact that Western Euro-
pean economy is not gaining in strength normally,
under its own power, but at the expense and on ac-
count of the U. S. A., and because it is mainly de-
pendent on the American market in the matter of raw
materials.
Nor is to be overlooked the fact that the U. S. A..
even though it is advancing frontally in connection
with its plans for the integration of Western Euro-
pean economy, nevertheless does not adopt an iden-
tical attitude towards all the West European coun-
tries. In the first phase of their economic intervention,
the Americans have principally endeavoured to save
the positions of the bourgeoisie in France, It is to be
said that there are still many reasons for the continu-
ation of such support. However, the U. S. A. is actu-
ally far more interested in the strengthening of the
West German economic potential. In the first place,
because, due to the amalgamation of American and
German monopolies, the U. S. A. is interested that
Germany should regain her erstwhile position, and
secondly, because, within the framework of American
military strategy, Western Germany, with her vast in-
dustrial and manpower potential, represents a factor
of greater significance than France. This fact alone
renders problematic the entire policy being pursued
today by France.
It is understandable that France should be trying
to paralyze this by taking the initiative for the crea-
tion of the so-called higher form of European inte-
gration, whose first contour is the Schuman Plan for
the merging of the French and West German coal and
steel industries. By means of these and similar agree-
ments, France is endeavouring to exploit her present
political positions in a way which would secure for
her predominance in such a future unified Western
Europe. But such agreements can be sustained only
for the duration of the cold war, which is forcing the
U. S. to grant concessions to France at the expense
of Germany. For the German economic potential is
stronger than the French, and, also, labour in Western
Germany is cheaper than it is in France, all of which
casts a problematic light on the "predominance" which
France strives to secure for herself. On the other hand,
the implementation of the Schuman integration plans
spells for the French working class a lowering of the
living stadard: For only in this fasion would the
French capitalists be able to endure German compe-
tition to some extent at least.
Henceforth, the 'position of France in the united
Europe of the future could scarcely be in accord with
the desires of the French ruling circles. This positi,on
will change subject to the developments of the cold
war and of the international situation in general, to
the speed and the degree of rehabilitation of Germany
and the development of the internal situation in Fran-
ce herself.
Z. R.
Djordje ANDREJEVICH-KUN: SPANISH PATRIOTS BEING
EXECUTED BY THE FASCISTS (Woodcut)
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LIFE IN SoctALtsT YUGOSLAVIA
Voters' Assemblies - An Expression
of Direct Democracy
FROM the very first days of its
existence, popular democracy in
Yugoslavia has been such that the
people have been able to take a
direct part in government. It can
even be said that the forms of
this democracy were the first forms
of popular democracy in Yugoslavia
in which the National Liberation
Committees, which emerged at the
beginning of the insurrection in
1941, were organs elected and recal-
led directly by the people at their
meetings and authorized by them to
carry on the work of government
in the name of the people. The
meetings at which the people elected
organs of governmeht, called Voters'
Assemblies or meetings of voters,
did not meet only for the purpose
of election of the National Libera-
tion Committees but also to discuss
all rroblems of town and country
and to adopt general and binding
decisions.
The development of people's gov-
ernment in Yugoslavia during the
war and after the war brought
with it a whole series of new and
advanced forms through which the
people were to take part in the
running of the government in every-
day life. The most explicit of such
forms are the workers' councils by
which he workers manage the state
economic enterprises; then there
are the CitiZens' Councils, through
which the citizens take increasingly
direct part in the implementation
of the work of state administration.
However, the "voters' assemblies"
have not lost their great importance
in the system of popular democracy.
They have remained the most
explicit form of direct popular
democracy, if we understand direct
democracy to have the meaning it
has today in all progressive science
on the state, that is, as a form
through which the people take
direct part in the government with-
out any delegates. The voters'
assemblies as such, a form of direct
popular democracy, were given legal
status in the General Law on Peo-
ple's Committees, Article 98-102.
The Law lays down the following
fundamental principles as regards
the voters' assemblies:
1) 'Voters' assemblies are competent to
discuss questiateas which are related
either to the affairs tit the Locality
or town and problems from the
competence of higher people's com- of discussing certain problems which
mittees and other state organs. They
are therefore organs of direct popu- effect all citizens at the voters'
lar control over the work of all
organs of government;
2) All voters or electoral units, have
the right to take part in the voters'
assemblies, to put forward proposals
and to vote;
3) The voters' assemblies are regularly
held every two. months. A special
voters' assembly can be called by
the People's Committee on its own
initiative or upon demand by one
fifth of the voters;
4) The Committee member elected in
the respective electoral unit renders
account to the voters' assembly and,
upon demand by the voters, the
People's Committee must also render
acount of all its work to it;
5) At eacn one of its current sessions,
the People's Committee must dis-
cuss and make decisions on the
conclusions reached by the voters'
assemblies, and If they relate to
higher organs, it must submit them
to the higher organs for consider-
ation. If the People's Committee
does not adopt the conclusions of
the voters' assembly, It must inform
the Plenum of the higher People's
Committee of this and the latter
will then make a decision on this.
The General Law on People's
Committees, as we see, laid down
only the fundamental principle for
the functioning of the voters' as-
semblies. On the basis of this, the
various Republics have the duty of
adopting their own Laws on voters'
assemblies elaborating this material
which is of tremendous principled
importance for the further work
of the people's government. These
laws are now in preparation.
Although the legisaltive material
on the voters' assemblies has not
yet been elaborated, they never-
theless have a long tradition and a
great deal of experience behind
them in our country. The assemblies
of voters are, so to speak, a daily
phenomenom in our villages and
towns, especially in those regions
where our people's government
developed during the war. In 1949,
there were in Yugoslavia 28,000
voters' assemblies. In Bosnia, for
instance, there were over 4,000 in
which almost a million voters took
part. At their meetings, the voters
discuss almost all questions relat-
ing to the work of the People's
Committees. For example, at the
voters' assemblies in Zemun during
the months of September and Oc-
tober, 121 questions were brought
up in connection with public works,
414 questions regarding supplies, 44
questions related to the housing pro-
blem, 23 question having to do
with health service, etc. The Local
People's Committees have the duty
assemblies. The Decree on the State
Grain Purchase provides that the
assessments of grain be brought
out at the voters' assemblies so
that the latter can come to a deci-
sion regarding their correctness.
This is also provided for in regard
to the sowing plan, tax assessments,
etc. The Law on the Recall of Peo-
ple's Deputies gives the Voters'
Assemblies the right of initiative in
recalling their representatives.
Although we can freely state that
the Assemblies of Voters are the
oldest insitution of our popular
democracy, and although they have
a long tradition behind them and
are developing more and more, we
still cannot claim that they have ad-
venced sufficiently and that they
have reached that level which is ne-
cessary in a system of popular democ-
racy. Standing in the way of the
development of Voters' Assemblies
are bureaucratic tendencies specially
in the District, Town and Local
People's Committees. Various kinds
of bureaucratic officials in these
People's Committees are endeav-
oring to wrest themselves from the
control of the people and that is
why the first thing they do is try
to neglect the Assemblies of Voters.
For that reason, the fight against
bureaucracy is at the same time a
fight for all forms of participation
by the people in the administration,
and particularly a fight for the
further development and consoli-
dation of the Voters' Assemblies.
Perceiving all the shortcomings
and obstacles in the way of de-
velopment of the Voters' Assemblies,
the Communist Party of Yugoslavia
has put it to its local organization
to dc.velop the participation of the
people in the administration and
their criticism of the organs of state
administration. The local branches of
the Communist Party must organize
this criticism through the Voters'
Assemblies and fight to have the
People's Committees do what the
people demand in their criticism.
This political line of the Communist
Party of Yugoslavia has already
been reflected in the consolidation
of the role and importance of Voters'
Assemblies. They are developing as
the most explicit form of direct
democracy in the system of popular
government in Yugoslavia.
Dr. Leon GERSHKOVICH
Approved For Release 2002/01/1V: tIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM USA
On the Eve of
Elections to the
Congress
OWING to the international si-
tuation and the war in Korea,
the recess of Congress was
much delayed this year, and the
election campaign has started later
than usual. Regardless of this
belated start, however, far greater
interest centres on the forthcoming
elections than would be normally
warranted in an "off-year", viz, a
year in which only the elections to
the House of Representatives and
to a third of the Senate take place,
and not the Presidential elections.
The election struggle here usually
revolves around domestic issues.
The activities of the Congress in
the election year are, therefore,
carefully adjusted to the needs of
the electioneering campaign. The
party in power tends to push tro-
ugh Congress as many of its pro-
gramatic measures as possible. But
the Democrats this time have no
particular cause to pride themselves
on the work of the last Congress,
the 81st in American history. None
of the more important measures
which figured in their election
schedule in 1948 have been adopted
by the Congress. The abolition of
the anti-labour legislation, the Bran-
nan p] .an on farming subsidies, the
programme for the protection of
civic rights, the law on Federal
aid to education and other similar
measures were shipwrecked in Con-
gress under the blows of the Repub-
licans, unit ed with the reactionary
Democratic fraction, espesially those
from the semi-feudal South. The
only substantial success recorded by
the Government was in the improved
system of social insurance. The
reactionary forces have succeeded,
in spite of Truman's veto, in having
the Congress adopt, with an enor-
mous majority, the MacCarran anti-1
Communist law. This law would,
never have been adopted if it had
not been for the increasingly aggres-
sive policy of the Soviet Union
throughout the world, and for the
Cominformist line of the U. S.
Communist Party.
In contrast to former times,
when victory in the elections used
to be conditioned by internal issues,
the latter have been relagated to
a secondary role today. The inter-
national situation, and especially
the war in Korea, have caused
international problems to come to
the forefront.
It already became clear early
this year that the fight against
world communism would form the
principal slogan in the elections.
In Congress, the Republicans, repre-
senting big business and extreme
reaction, as early as January launch-
ed their attack on the Gov-
ernment. Especially strong was the
campaign of Senator MacCarthy
against the Secretary of State, Dean
Acheson, who was accused of having
admitted communists and fellow-
travellers to leading posts in the
State Department. In the sphere of
international policy, the Republican
attacks have been focussed on Tru-
man and Acheson, who were accused
of responsibility for the defeat of
Chiang Kai-shek and causing the
loss of the most valuable U. S.
positions there by trying to appease
communism in Asia. This campaign
reached its climax with Truman's
rejection of the demand put for-
ward by military circles for in-
tervention in Formosa.
The Korean conflict has led to
changes in the electioneering cam-
paign. The Republicans, whose
campaign was built on the accusa-
tion that the Democrats had been
pursuing a too soft and yield-
ing policy in Asia, were suddenly
faced by the fact that it was precise-
ly the Democrats' own government
which had adopted such measures
in Korea which far exceeded
anything the Republicans had been
asking up to then.
Faced with this situation, they
shifted the whole blame for the
war to mistakes committed by the
Government. The latter was espe-
cially exposed to censure on account
of the premature withdrawal of
U. S. troops from Korea, in 1948,
and because of certain statements by
Democratic politicians to the effect
that Korea did not belong to the
U. S. defense perimeter. In ad-
dition to Acheson himself, the Minis-
ter of National Defense, Louis
Johnson, was also the main target
of Republican attack. The campaign
produced such tension and mass
excitement that even Democratic
candidates were prompted to exert
pressure on Truman to fire Acheson
and Johnson. Truman at first stub-
bornly refused, but when Acheson
and Johnson clashed the latter had
to resign. General Marshall's ap-
pointment in the place of Johnson
was a rather sound tactical move.
Marshall's popularity and the con-
fidence inspired by him as a
soldier among the American masses
are very great, and the linking of
his name with Truman's govern-
ment has grealy benefitted the
Democratic party.
Defending themselves from the
charges of yielding to USSR in
the international sphere, the Democ-
rats carefully combed the Congres-
sional Record and issued a docu-
mented publication proving their
merit in the adoption of a series of
measures, in the face of tenacious
Republican opposition- mainly desig-
ned to resist the USSR on a world
scale. A large group of Republicans,
mostly isolationists from the
Middle-West, was opposed to the
Marshall Plan, the Atlantic Pact,
the Military Aid Programme, etc.
Thanks to the Republicans, the
bill on the assistance to South
Korea was rejected at its first
reading in the House of Represen-
tatives early this year. Accordingly,
could the USSR not be able to
draw the conclusion that the U. S.
would not send its troops to Korea
when it was reluctant to send even
dollars there?, asked the Democrats.
At all events, the successes in
Korea have improved the Democrats'
position and the election results
will largely depend on the develop-
ments in the war situation on the
very eve of the elections.
The exclusive contestants in the
November elections will be the
Democrats and the Republicans. The
Progressive Party will make a bid
in fifteen states, although practically
with no prospects of success. Even
the re-election of the party's only
present Congressman, Marcantonio,
is problematic. After the recent split
and Wallace's exit, the party no
longer represents a serious political
force.
The mainstay of the Republicans
lies in the conservative farming
districts and petty-bourgeois ele-
ments in minor cities, especially in
the Middle-West and North-East
(New England). By being a party
of big capital, it naturally follows
that most of its election funds
accrue from the contributions of
bankers and industrialists. The
Democrats are strongest in industrial
states and in the traditional "Solid
South". Their mighty allies are the
large labour unions, especially the
CIO, whose political action com-
mittees actively work for Democrat-
ic candidates. The powerful and
wealthy labour unions represent an
important source of financial assets
for the election campaign of the
Democrats. The Democrats expect
to corner this time most of the vdtes
which had been cast for Wallace
before.
In order to achieve a majority
in the Congress, the Republicans
would require to wrest from the
Democrats 47 seats in the House
of Representatives and 7 seats in
the Senate. Will they succeed in
this? It is a hard question to answer.
The forecasting of election results
in U. S. is a very thankless task,
as borne out by the last elections,
in 1948, which gave Truman a
resounding victory in spite of all
the prognoses having been against
him.
Ray WILSON
? 15 ?
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM ITALY
Economic and Finan-
cial Situation in Italy
E criticizm of the Italian gov-
ernment's economic and finan-
cial policy, which was given a few
days ago by Mr. Leon Dayton, the
chief of the American Mission for
the Marshall Plan in Rome, at a
press conference, represents to-day
the centre of all the political actions
in the Italian capital. First of all, this
criticism has come unexpectedly as
can be seen from the first answer,
which was given by the semi-oficial
Italian ANSA agency, in the folowing
words: "In the political circles of
Rome great astonishment is being
expressed concerning the criticism
of Mr. Dayton, for, not only in the
opinion of the Italian Government,
it is in contradiction with the
public acknowledgments, which the
former chief of the American eco-
nomic mission in Italy. Mr. Zeller-
bach, has paid to Italy's efforts at
recovery within the framework of
the Marshall Plan".
This astonishment in the Roman
circles was really justified, because
the tone of Mr, Dayton's statement
was very enrgeteic: "...the present
economic and financial policy in
Italy is pushing her economy into
ruin, there exists very little hope
that with the additional 200 million
dollars, which Italy has yet to re-
ceive before the end of the Marshall
Plan, she will succeed to compensate
what her economy has lost through
the liquidation of her metal industry
and through the steady icrease of
unemployment".
There is no doubt, for all those
who know the economic conditions
in Italy, that this critisism is bas-
icaly true and irrefutable and that
it comes as a logical conse-
quence of the development of in-
ternational situation. The aid, which
the United States is extending to
the Western European countries
within the framework of the Mar-
shall Plan, has been condiderably
r duced this year, while the opera-
tive program for its aplication has
been essentialy changed at the time
when the British pound was deva-
lued.
Instead of being used for the
achievement of budgetary stability
and for the balancing of their large
expenditures, as was at first
conceived, all the European coun-
tries, by the decision of OEEC, are
using the greater part of tihs aid
primarily for new armaments and
for investments in heavy industry.
Meanwhile, Italy is the only country
in Western Europe, which has not
devalued her national currency.
Moreover, the clauses of the peace
treaty forbidding the production of
war materials have helped her to
utilise all the aid, received through
the Marshall Plan, exclusively for
balancing her budgetary expend-
itures. This economic policy of
maintaining the value of the Lira
is an expressly deflationary policy
pursued by Mr. Pella, the Minister
of the State Treassury, who, it is
said, is the right hand man of Mr.
Luigi Einaudi, the President of the
Italian Republic, who is one of the
most prominent of the Italian
liberals in the sphere of economics.
The defence of the Lira, which
represents the main pillar of the
present policy of the sixth cabinet
of Prime Minister de Gaspperi,
imposes in the meantime heavy
sacrifices on the Italian economy.
From the state resources no invest-
ments can be made, because there
are no funds. The help from America
is sufficient only for the covering
of regular expenditures of the
Italian State. From the start of the
Marshall Plan up to this day Italy
has received something over 700
million dollars in goods, which were
used to satisfy the needs of the
population in foodstuffs, textiles
and for reconstruction of the most
critical communications, schools and
hospitals. Nothing was left for
industrialisation.
Such a situation brought about a
destructive policy of liquidation,
first of the Italian metallurgical
and heavy industry, and afterwards
of some branches of light industry.
From the day the Marshall Plan
was put into operation until today,
according to incomplete data,
there were liquidated over 1,000
large industrial plants, which
caused the bankruptcy of a whole
chain of smaller industrial enter-
prises and of big commercial and
retail firms. The factories were
closed one after the other, and the
number of unemployed is constantly
increasing.
There in no doubt that United
States interest in the Italian econ-
omy is mostly centered on the
question of full capacity utilisation
of the heavy industry, and in the
possibility of its increase and expan-
sion, and secondly, as an important
political question, also in the pro-
blem of unemployment. For that
reason Mr. Dayton proposes "a bold-
er economic policy of investments,
which will not stop even at the pos-
sibility of inflation". He knows, of
course, that there are no available
reserves in the budget for new in-
vestments and he, therefore, quite
openly proposes to the Government
to devalue the Lira; to abandon the
policy of maintaining its purshas-
ing power and in this way to achie-
ve the full utilisation of industrial
capacity of Italy in the collective
efforts for the armament of the A-
tlantic Pact countries.
This whole case of Dayton's criti-
cisms would not perhaps represent
such a central question in the Italian
politicis, if it had not revealed a new
contradiction between the Italian
State, a beneficiary of Marshall Plan,
and the United States, which is ex-
tending that aid. There is no doubt
that the increase of production can
help the Italian economy, but if it
must result in budget deficits, and
consequently in the inflation of the
Lira, which means transferring the
burden of investments on to the back
of the small man-the worker, under
conditions in which the means of
production do not belong to the
workers, nor a worker's or a peo-
ple's state, than it is clear that such
a path can be of advantage only to
those who wish to exploit the efforts
for the reinforcement of the arma-
ments of one of the blocs.
In the governmenal political circles
Dayton's criticism was a blow for
all those who, together with Minister
Pella, for three years promulgated
the policy of defence of the Lira.
To desert that policy, now would
mean the fall of the Government.
This possibility is especially certan
because in the circles of the Christ-
ian Democratic party there are
many, who, like the Minister of In-
terior Affairs, Scelba, in alliance with
the Republican Minister of War. Pac-
ciardi, consider that the question of
the future military defence (in fact
of the present armaments) can be
solved exclusively through the deva-
luation of the Lira, and through the
increase of production with special
emphisis oct investement in the
means of production which should
be found even at the expense of ge-
neral increase of deficits.
From all the foregoing factors the
prevailing opinion in Rome is that
Dayton's criticism represents the
creation of a most serious economic
and political crisis.
B. RAFAJLOVIC
Review of
INTERNATIONAL
AFFAIRS
Published tur'ce a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices: International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103-906033.
Approved For Release 2002/01/181:6CIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM ITALY
Economic and Finan-
cial Situation in Italy
E criticizm of the Italian gov-
ernment's economic and finan-
cial policy, which was given a few
days ago by Mr. Leon Dayton, the
chief of the American Mission for
the Marshall Plan in Rome, at a
press conference, represents to-day
the centre of all the political actions
in the Italian capital. First of all, this
criticism has come unexpectedly as
can be seen from the first answer,
which was given by the semi-oficial
Italian ANSA agency, in the folowing
words: "In the political circles of
Rome great astonishment is being
expressed concerning the criticism
of Mr. Dayton, for, not only in the
opinion of the Italian Government,
it is in contradiction with the
public acknowledgments, which the
former chief of the American eco-
nomic mission in Italy. Mr. Zeller-
bach, has paid to Italy's efforts at
recovery within the framework of
the Marshall Plan".
This astonishment in the Roman
circles was really justified, because
the tone of Mr, Dayton's statement
was very enrgeteic: "...the present
economic and financial policy in
Italy is pushing her economy into
ruin, there exists very little hope
that with the additional 200 million
dollars, which Italy has yet to re-
ceive before the end of the Marshall
Plan, she will succeed to compensate
what her economy has lost through
the liquidation of her metal industry
and through the steady icrease of
unemployment".
There is no doubt, for all those
who know the economic conditions
in Italy, that this critisism is bas-
icaly true and irrefutable and that
it comes as a logical conse-
quence of the development of in-
ternational situation. The aid, which
the United States is extending to
the Western European countries
within the framework of the Mar-
shall Plan, has been condiderably
r duced this year, while the opera-
tive program for its aplication has
been essentialy changed at the time
when the British pound was deva-
lued.
Instead of being used for the
achievement of budgetary stability
and for the balancing of their large
expenditures, as was at first
conceived, all the European coun-
tries, by the decision of OEEC, are
using the greater part of tihs aid
primarily for new armaments and
for investments in heavy industry.
Meanwhile, Italy is the only country
in Western Europe, which has not
devalued her national currency.
Moreover, the clauses of the peace
treaty forbidding the production of
war materials have helped her to
utilise all the aid, received through
the Marshall Plan, exclusively for
balancing her budgetary expend-
itures. This economic policy of
maintaining the value of the Lira
is an expressly deflationary policy
pursued by Mr. Pella, the Minister
of the State Treassury, who, it is
said, is the right hand man of Mr.
Luigi Einaudi, the President of the
Italian Republic, who is one of the
most prominent of the Italian
liberals in the sphere of economics.
The defence of the Lira, which
represents the main pillar of the
present policy of the sixth cabinet
of Prime Minister de Gaspperi,
imposes in the meantime heavy
sacrifices on the Italian economy.
From the state resources no invest-
ments can be made, because there
are no funds. The help from America
is sufficient only for the covering
of regular expenditures of the
Italian State. From the start of the
Marshall Plan up to this day Italy
has received something over 700
million dollars in goods, which were
used to satisfy the needs of the
population in foodstuffs, textiles
and for reconstruction of the most
critical communications, schools and
hospitals. Nothing was left for
industrialisation.
Such a situation brought about a
destructive policy of liquidation,
first of the Italian metallurgical
and heavy industry, and afterwards
of some branches of light industry.
From the day the Marshall Plan
was put into operation until today,
according to incomplete data,
there were liquidated over 1,000
large industrial plants, which
caused the bankruptcy of a whole
chain of smaller industrial enter-
prises and of big commercial and
retail firms. The factories were
closed one after the other, and the
number of unemployed is constantly
increasing.
There in no doubt that United
States interest in the Italian econ-
omy is mostly centered on the
question of full capacity utilisation
of the heavy industry, and in the
possibility of its increase and expan-
sion, and secondly, as an important
political question, also in the pro-
blem of unemployment. For that
reason Mr. Dayton proposes "a bold-
er economic policy of investments,
which will not stop even at the pos-
sibility of inflation". He knows, of
course, that there are no available
reserves in the budget for new in-
vestments and he, therefore, quite
openly proposes to the Government
to devalue the Lira; to abandon the
policy of maintaining its purshas-
ing power and in this way to achie-
ve the full utilisation of industrial
capacity of Italy in the collective
efforts for the armament of the A-
tlantic Pact countries.
This whole case of Dayton's criti-
cisms would not perhaps represent
such a central question in the Italian
politicis, if it had not revealed a new
contradiction between the Italian
State, a beneficiary of Marshall Plan,
and the United States, which is ex-
tending that aid. There is no doubt
that the increase of production can
help the Italian economy, but if it
must result in budget deficits, and
consequently in the inflation of the
Lira, which means transferring the
burden of investments on to the back
of the small man-the worker, under
conditions in which the means of
production do not belong to the
workers, nor a worker's or a peo-
ple's state, than it is clear that such
a path can be of advantage only to
those who wish to exploit the efforts
for the reinforcement of the arma-
ments of one of the blocs.
In the governmenal political circles
Dayton's criticism was a blow for
all those who, together with Minister
Pella, for three years promulgated
the policy of defence of the Lira.
To desert that policy, now would
mean the fall of the Government.
This possibility is especially certan
because in the circles of the Christ-
ian Democratic party there are
many, who, like the Minister of In-
terior Affairs, Scelba, in alliance with
the Republican Minister of War. Pac-
ciardi, consider that the question of
the future military defence (in fact
of the present armaments) can be
solved exclusively through the deva-
luation of the Lira, and through the
increase of production with special
emphisis oct investement in the
means of production which should
be found even at the expense of ge-
neral increase of deficits.
From all the foregoing factors the
prevailing opinion in Rome is that
Dayton's criticism represents the
creation of a most serious economic
and political crisis.
B. RAFAJLOVIC
Review of
INTERNATIONAL
AFFAIRS
Published tur'ce a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices: International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103-906033.
Approved For Release 2002/01/181:6CIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM ITALY
Economic and Finan-
cial Situation in Italy
E criticizm of the Italian gov-
ernment's economic and finan-
cial policy, which was given a few
days ago by Mr. Leon Dayton, the
chief of the American Mission for
the Marshall Plan in Rome, at a
press conference, represents to-day
the centre of all the political actions
in the Italian capital. First of all, this
criticism has come unexpectedly as
can be seen from the first answer,
which was given by the semi-oficial
Italian ANSA agency, in the folowing
words: "In the political circles of
Rome great astonishment is being
expressed concerning the criticism
of Mr. Dayton, for, not only in the
opinion of the Italian Government,
it is in contradiction with the
public acknowledgments, which the
former chief of the American eco-
nomic mission in Italy. Mr. Zeller-
bach, has paid to Italy's efforts at
recovery within the framework of
the Marshall Plan".
This astonishment in the Roman
circles was really justified, because
the tone of Mr, Dayton's statement
was very enrgeteic: "...the present
economic and financial policy in
Italy is pushing her economy into
ruin, there exists very little hope
that with the additional 200 million
dollars, which Italy has yet to re-
ceive before the end of the Marshall
Plan, she will succeed to compensate
what her economy has lost through
the liquidation of her metal industry
and through the steady icrease of
unemployment".
There is no doubt, for all those
who know the economic conditions
in Italy, that this critisism is bas-
icaly true and irrefutable and that
it comes as a logical conse-
quence of the development of in-
ternational situation. The aid, which
the United States is extending to
the Western European countries
within the framework of the Mar-
shall Plan, has been condiderably
r duced this year, while the opera-
tive program for its aplication has
been essentialy changed at the time
when the British pound was deva-
lued.
Instead of being used for the
achievement of budgetary stability
and for the balancing of their large
expenditures, as was at first
conceived, all the European coun-
tries, by the decision of OEEC, are
using the greater part of tihs aid
primarily for new armaments and
for investments in heavy industry.
Meanwhile, Italy is the only country
in Western Europe, which has not
devalued her national currency.
Moreover, the clauses of the peace
treaty forbidding the production of
war materials have helped her to
utilise all the aid, received through
the Marshall Plan, exclusively for
balancing her budgetary expend-
itures. This economic policy of
maintaining the value of the Lira
is an expressly deflationary policy
pursued by Mr. Pella, the Minister
of the State Treassury, who, it is
said, is the right hand man of Mr.
Luigi Einaudi, the President of the
Italian Republic, who is one of the
most prominent of the Italian
liberals in the sphere of economics.
The defence of the Lira, which
represents the main pillar of the
present policy of the sixth cabinet
of Prime Minister de Gaspperi,
imposes in the meantime heavy
sacrifices on the Italian economy.
From the state resources no invest-
ments can be made, because there
are no funds. The help from America
is sufficient only for the covering
of regular expenditures of the
Italian State. From the start of the
Marshall Plan up to this day Italy
has received something over 700
million dollars in goods, which were
used to satisfy the needs of the
population in foodstuffs, textiles
and for reconstruction of the most
critical communications, schools and
hospitals. Nothing was left for
industrialisation.
Such a situation brought about a
destructive policy of liquidation,
first of the Italian metallurgical
and heavy industry, and afterwards
of some branches of light industry.
From the day the Marshall Plan
was put into operation until today,
according to incomplete data,
there were liquidated over 1,000
large industrial plants, which
caused the bankruptcy of a whole
chain of smaller industrial enter-
prises and of big commercial and
retail firms. The factories were
closed one after the other, and the
number of unemployed is constantly
increasing.
There in no doubt that United
States interest in the Italian econ-
omy is mostly centered on the
question of full capacity utilisation
of the heavy industry, and in the
possibility of its increase and expan-
sion, and secondly, as an important
political question, also in the pro-
blem of unemployment. For that
reason Mr. Dayton proposes "a bold-
er economic policy of investments,
which will not stop even at the pos-
sibility of inflation". He knows, of
course, that there are no available
reserves in the budget for new in-
vestments and he, therefore, quite
openly proposes to the Government
to devalue the Lira; to abandon the
policy of maintaining its purshas-
ing power and in this way to achie-
ve the full utilisation of industrial
capacity of Italy in the collective
efforts for the armament of the A-
tlantic Pact countries.
This whole case of Dayton's criti-
cisms would not perhaps represent
such a central question in the Italian
politicis, if it had not revealed a new
contradiction between the Italian
State, a beneficiary of Marshall Plan,
and the United States, which is ex-
tending that aid. There is no doubt
that the increase of production can
help the Italian economy, but if it
must result in budget deficits, and
consequently in the inflation of the
Lira, which means transferring the
burden of investments on to the back
of the small man-the worker, under
conditions in which the means of
production do not belong to the
workers, nor a worker's or a peo-
ple's state, than it is clear that such
a path can be of advantage only to
those who wish to exploit the efforts
for the reinforcement of the arma-
ments of one of the blocs.
In the governmenal political circles
Dayton's criticism was a blow for
all those who, together with Minister
Pella, for three years promulgated
the policy of defence of the Lira.
To desert that policy, now would
mean the fall of the Government.
This possibility is especially certan
because in the circles of the Christ-
ian Democratic party there are
many, who, like the Minister of In-
terior Affairs, Scelba, in alliance with
the Republican Minister of War. Pac-
ciardi, consider that the question of
the future military defence (in fact
of the present armaments) can be
solved exclusively through the deva-
luation of the Lira, and through the
increase of production with special
emphisis oct investement in the
means of production which should
be found even at the expense of ge-
neral increase of deficits.
From all the foregoing factors the
prevailing opinion in Rome is that
Dayton's criticism represents the
creation of a most serious economic
and political crisis.
B. RAFAJLOVIC
Review of
INTERNATIONAL
AFFAIRS
Published tur'ce a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices: International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103-906033.
Approved For Release 2002/01/181:6CIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM ITALY
Economic and Finan-
cial Situation in Italy
E criticizm of the Italian gov-
ernment's economic and finan-
cial policy, which was given a few
days ago by Mr. Leon Dayton, the
chief of the American Mission for
the Marshall Plan in Rome, at a
press conference, represents to-day
the centre of all the political actions
in the Italian capital. First of all, this
criticism has come unexpectedly as
can be seen from the first answer,
which was given by the semi-oficial
Italian ANSA agency, in the folowing
words: "In the political circles of
Rome great astonishment is being
expressed concerning the criticism
of Mr. Dayton, for, not only in the
opinion of the Italian Government,
it is in contradiction with the
public acknowledgments, which the
former chief of the American eco-
nomic mission in Italy. Mr. Zeller-
bach, has paid to Italy's efforts at
recovery within the framework of
the Marshall Plan".
This astonishment in the Roman
circles was really justified, because
the tone of Mr, Dayton's statement
was very enrgeteic: "...the present
economic and financial policy in
Italy is pushing her economy into
ruin, there exists very little hope
that with the additional 200 million
dollars, which Italy has yet to re-
ceive before the end of the Marshall
Plan, she will succeed to compensate
what her economy has lost through
the liquidation of her metal industry
and through the steady icrease of
unemployment".
There is no doubt, for all those
who know the economic conditions
in Italy, that this critisism is bas-
icaly true and irrefutable and that
it comes as a logical conse-
quence of the development of in-
ternational situation. The aid, which
the United States is extending to
the Western European countries
within the framework of the Mar-
shall Plan, has been condiderably
r duced this year, while the opera-
tive program for its aplication has
been essentialy changed at the time
when the British pound was deva-
lued.
Instead of being used for the
achievement of budgetary stability
and for the balancing of their large
expenditures, as was at first
conceived, all the European coun-
tries, by the decision of OEEC, are
using the greater part of tihs aid
primarily for new armaments and
for investments in heavy industry.
Meanwhile, Italy is the only country
in Western Europe, which has not
devalued her national currency.
Moreover, the clauses of the peace
treaty forbidding the production of
war materials have helped her to
utilise all the aid, received through
the Marshall Plan, exclusively for
balancing her budgetary expend-
itures. This economic policy of
maintaining the value of the Lira
is an expressly deflationary policy
pursued by Mr. Pella, the Minister
of the State Treassury, who, it is
said, is the right hand man of Mr.
Luigi Einaudi, the President of the
Italian Republic, who is one of the
most prominent of the Italian
liberals in the sphere of economics.
The defence of the Lira, which
represents the main pillar of the
present policy of the sixth cabinet
of Prime Minister de Gaspperi,
imposes in the meantime heavy
sacrifices on the Italian economy.
From the state resources no invest-
ments can be made, because there
are no funds. The help from America
is sufficient only for the covering
of regular expenditures of the
Italian State. From the start of the
Marshall Plan up to this day Italy
has received something over 700
million dollars in goods, which were
used to satisfy the needs of the
population in foodstuffs, textiles
and for reconstruction of the most
critical communications, schools and
hospitals. Nothing was left for
industrialisation.
Such a situation brought about a
destructive policy of liquidation,
first of the Italian metallurgical
and heavy industry, and afterwards
of some branches of light industry.
From the day the Marshall Plan
was put into operation until today,
according to incomplete data,
there were liquidated over 1,000
large industrial plants, which
caused the bankruptcy of a whole
chain of smaller industrial enter-
prises and of big commercial and
retail firms. The factories were
closed one after the other, and the
number of unemployed is constantly
increasing.
There in no doubt that United
States interest in the Italian econ-
omy is mostly centered on the
question of full capacity utilisation
of the heavy industry, and in the
possibility of its increase and expan-
sion, and secondly, as an important
political question, also in the pro-
blem of unemployment. For that
reason Mr. Dayton proposes "a bold-
er economic policy of investments,
which will not stop even at the pos-
sibility of inflation". He knows, of
course, that there are no available
reserves in the budget for new in-
vestments and he, therefore, quite
openly proposes to the Government
to devalue the Lira; to abandon the
policy of maintaining its purshas-
ing power and in this way to achie-
ve the full utilisation of industrial
capacity of Italy in the collective
efforts for the armament of the A-
tlantic Pact countries.
This whole case of Dayton's criti-
cisms would not perhaps represent
such a central question in the Italian
politicis, if it had not revealed a new
contradiction between the Italian
State, a beneficiary of Marshall Plan,
and the United States, which is ex-
tending that aid. There is no doubt
that the increase of production can
help the Italian economy, but if it
must result in budget deficits, and
consequently in the inflation of the
Lira, which means transferring the
burden of investments on to the back
of the small man-the worker, under
conditions in which the means of
production do not belong to the
workers, nor a worker's or a peo-
ple's state, than it is clear that such
a path can be of advantage only to
those who wish to exploit the efforts
for the reinforcement of the arma-
ments of one of the blocs.
In the governmenal political circles
Dayton's criticism was a blow for
all those who, together with Minister
Pella, for three years promulgated
the policy of defence of the Lira.
To desert that policy, now would
mean the fall of the Government.
This possibility is especially certan
because in the circles of the Christ-
ian Democratic party there are
many, who, like the Minister of In-
terior Affairs, Scelba, in alliance with
the Republican Minister of War. Pac-
ciardi, consider that the question of
the future military defence (in fact
of the present armaments) can be
solved exclusively through the deva-
luation of the Lira, and through the
increase of production with special
emphisis oct investement in the
means of production which should
be found even at the expense of ge-
neral increase of deficits.
From all the foregoing factors the
prevailing opinion in Rome is that
Dayton's criticism represents the
creation of a most serious economic
and political crisis.
B. RAFAJLOVIC
Review of
INTERNATIONAL
AFFAIRS
Published tur'ce a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices: International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103-906033.
Approved For Release 2002/01/181:6CIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM ITALY
Economic and Finan-
cial Situation in Italy
E criticizm of the Italian gov-
ernment's economic and finan-
cial policy, which was given a few
days ago by Mr. Leon Dayton, the
chief of the American Mission for
the Marshall Plan in Rome, at a
press conference, represents to-day
the centre of all the political actions
in the Italian capital. First of all, this
criticism has come unexpectedly as
can be seen from the first answer,
which was given by the semi-oficial
Italian ANSA agency, in the folowing
words: "In the political circles of
Rome great astonishment is being
expressed concerning the criticism
of Mr. Dayton, for, not only in the
opinion of the Italian Government,
it is in contradiction with the
public acknowledgments, which the
former chief of the American eco-
nomic mission in Italy. Mr. Zeller-
bach, has paid to Italy's efforts at
recovery within the framework of
the Marshall Plan".
This astonishment in the Roman
circles was really justified, because
the tone of Mr, Dayton's statement
was very enrgeteic: "...the present
economic and financial policy in
Italy is pushing her economy into
ruin, there exists very little hope
that with the additional 200 million
dollars, which Italy has yet to re-
ceive before the end of the Marshall
Plan, she will succeed to compensate
what her economy has lost through
the liquidation of her metal industry
and through the steady icrease of
unemployment".
There is no doubt, for all those
who know the economic conditions
in Italy, that this critisism is bas-
icaly true and irrefutable and that
it comes as a logical conse-
quence of the development of in-
ternational situation. The aid, which
the United States is extending to
the Western European countries
within the framework of the Mar-
shall Plan, has been condiderably
r duced this year, while the opera-
tive program for its aplication has
been essentialy changed at the time
when the British pound was deva-
lued.
Instead of being used for the
achievement of budgetary stability
and for the balancing of their large
expenditures, as was at first
conceived, all the European coun-
tries, by the decision of OEEC, are
using the greater part of tihs aid
primarily for new armaments and
for investments in heavy industry.
Meanwhile, Italy is the only country
in Western Europe, which has not
devalued her national currency.
Moreover, the clauses of the peace
treaty forbidding the production of
war materials have helped her to
utilise all the aid, received through
the Marshall Plan, exclusively for
balancing her budgetary expend-
itures. This economic policy of
maintaining the value of the Lira
is an expressly deflationary policy
pursued by Mr. Pella, the Minister
of the State Treassury, who, it is
said, is the right hand man of Mr.
Luigi Einaudi, the President of the
Italian Republic, who is one of the
most prominent of the Italian
liberals in the sphere of economics.
The defence of the Lira, which
represents the main pillar of the
present policy of the sixth cabinet
of Prime Minister de Gaspperi,
imposes in the meantime heavy
sacrifices on the Italian economy.
From the state resources no invest-
ments can be made, because there
are no funds. The help from America
is sufficient only for the covering
of regular expenditures of the
Italian State. From the start of the
Marshall Plan up to this day Italy
has received something over 700
million dollars in goods, which were
used to satisfy the needs of the
population in foodstuffs, textiles
and for reconstruction of the most
critical communications, schools and
hospitals. Nothing was left for
industrialisation.
Such a situation brought about a
destructive policy of liquidation,
first of the Italian metallurgical
and heavy industry, and afterwards
of some branches of light industry.
From the day the Marshall Plan
was put into operation until today,
according to incomplete data,
there were liquidated over 1,000
large industrial plants, which
caused the bankruptcy of a whole
chain of smaller industrial enter-
prises and of big commercial and
retail firms. The factories were
closed one after the other, and the
number of unemployed is constantly
increasing.
There in no doubt that United
States interest in the Italian econ-
omy is mostly centered on the
question of full capacity utilisation
of the heavy industry, and in the
possibility of its increase and expan-
sion, and secondly, as an important
political question, also in the pro-
blem of unemployment. For that
reason Mr. Dayton proposes "a bold-
er economic policy of investments,
which will not stop even at the pos-
sibility of inflation". He knows, of
course, that there are no available
reserves in the budget for new in-
vestments and he, therefore, quite
openly proposes to the Government
to devalue the Lira; to abandon the
policy of maintaining its purshas-
ing power and in this way to achie-
ve the full utilisation of industrial
capacity of Italy in the collective
efforts for the armament of the A-
tlantic Pact countries.
This whole case of Dayton's criti-
cisms would not perhaps represent
such a central question in the Italian
politicis, if it had not revealed a new
contradiction between the Italian
State, a beneficiary of Marshall Plan,
and the United States, which is ex-
tending that aid. There is no doubt
that the increase of production can
help the Italian economy, but if it
must result in budget deficits, and
consequently in the inflation of the
Lira, which means transferring the
burden of investments on to the back
of the small man-the worker, under
conditions in which the means of
production do not belong to the
workers, nor a worker's or a peo-
ple's state, than it is clear that such
a path can be of advantage only to
those who wish to exploit the efforts
for the reinforcement of the arma-
ments of one of the blocs.
In the governmenal political circles
Dayton's criticism was a blow for
all those who, together with Minister
Pella, for three years promulgated
the policy of defence of the Lira.
To desert that policy, now would
mean the fall of the Government.
This possibility is especially certan
because in the circles of the Christ-
ian Democratic party there are
many, who, like the Minister of In-
terior Affairs, Scelba, in alliance with
the Republican Minister of War. Pac-
ciardi, consider that the question of
the future military defence (in fact
of the present armaments) can be
solved exclusively through the deva-
luation of the Lira, and through the
increase of production with special
emphisis oct investement in the
means of production which should
be found even at the expense of ge-
neral increase of deficits.
From all the foregoing factors the
prevailing opinion in Rome is that
Dayton's criticism represents the
creation of a most serious economic
and political crisis.
B. RAFAJLOVIC
Review of
INTERNATIONAL
AFFAIRS
Published tur'ce a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices: International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103-906033.
Approved For Release 2002/01/181:6CIA-RDP83-00415R006800010001-4
Approved For Release 2002/01/18 : CIA-RDP83-00415R006800010001-4
A LETTER FROM ITALY
Economic and Finan-
cial Situation in Italy
E criticizm of the Italian gov-
ernment's economic and finan-
cial policy, which was given a few
days ago by Mr. Leon Dayton, the
chief of the American Mission for
the Marshall Plan in Rome, at a
press conference, represents to-day
the centre of all the political actions
in the Italian capital. First of all, this
criticism has come unexpectedly as
can be seen from the first answer,
which was given by the semi-oficial
Italian ANSA agency, in the folowing
words: "In the political circles of
Rome great astonishment is being
expressed concerning the criticism
of Mr. Dayton, for, not only in the
opinion of the Italian Government,
it is in contradiction with the
public acknowledgments, which the
former chief of the American eco-
nomic mission in Italy. Mr. Zeller-
bach, has paid to Italy's efforts at
recovery within the framework of
the Marshall Plan".
This astonishment in the Roman
circles was really justified, because
the tone of Mr, Dayton's statement
was very enrgeteic: "...the present
economic and financial policy in
Italy is pushing her economy into
ruin, there exists very little hope
that with the additional 200 million
dollars, which Italy has yet to re-
ceive before the end of the Marshall
Plan, she will succeed to compensate
what her economy has lost through
the liquidation of her metal industry
and through the steady icrease of
unemployment".
There is no doubt, for all those
who know the economic conditions
in Italy, that this critisism is bas-
icaly true and irrefutable and that
it comes as a logical conse-
quence of the development of in-
ternational situation. The aid, which
the United States is extending to
the Western European countries
within the framework of the Mar-
shall Plan, has been condiderably
r duced this year, while the opera-
tive program for its aplication has
been essentialy changed at the time
when the British pound was deva-
lued.
Instead of being used for the
achievement of budgetary stability
and for the balancing of their large
expenditures, as was at first
conceived, all the European coun-
tries, by the decision of OEEC, are
using the greater part of tihs aid
primarily for new armaments and
for investments in heavy industry.
Meanwhile, Italy is the only country
in Western Europe, which has not
devalued her national currency.
Moreover, the clauses of the peace
treaty forbidding the production of
war materials have helped her to
utilise all the aid, received through
the Marshall Plan, exclusively for
balancing her budgetary expend-
itures. This economic policy of
maintaining the value of the Lira
is an expressly deflationary policy
pursued by Mr. Pella, the Minister
of the State Treassury, who, it is
said, is the right hand man of Mr.
Luigi Einaudi, the President of the
Italian Republic, who is one of the
most prominent of the Italian
liberals in the sphere of economics.
The defence of the Lira, which
represents the main pillar of the
present policy of the sixth cabinet
of Prime Minister de Gaspperi,
imposes in the meantime heavy
sacrifices on the Italian economy.
From the state resources no invest-
ments can be made, because there
are no funds. The help from America
is sufficient only for the covering
of regular expenditures of the
Italian State. From the start of the
Marshall Plan up to this day Italy
has received something over 700
million dollars in goods, which were
used to satisfy the needs of the
population in foodstuffs, textiles
and for reconstruction of the most
critical communications, schools and
hospitals. Nothing was left for
industrialisation.
Such a situation brought about a
destructive policy of liquidation,
first of the Italian metallurgical
and heavy industry, and afterwards
of some branches of light industry.
From the day the Marshall Plan
was put into operation until today,
according to incomplete data,
there were liquidated over 1,000
large industrial plants, which
caused the bankruptcy of a whole
chain of smaller industrial enter-
prises and of big commercial and
retail firms. The factories were
closed one after the other, and the
number of unemployed is constantly
increasing.
There in no doubt that United
States interest in the Italian econ-
omy is mostly centered on the
question of full capacity utilisation
of the heavy industry, and in the
possibility of its increase and expan-
sion, and secondly, as an important
political question, also in the pro-
blem of unemployment. For that
reason Mr. Dayton proposes "a bold-
er economic policy of investments,
which will not stop even at the pos-
sibility of inflation". He knows, of
course, that there are no available
reserves in the budget for new in-
vestments and he, therefore, quite
openly proposes to the Government
to devalue the Lira; to abandon the
policy of maintaining its purshas-
ing power and in this way to achie-
ve the full utilisation of industrial
capacity of Italy in the collective
efforts for the armament of the A-
tlantic Pact countries.
This whole case of Dayton's criti-
cisms would not perhaps represent
such a central question in the Italian
politicis, if it had not revealed a new
contradiction between the Italian
State, a beneficiary of Marshall Plan,
and the United States, which is ex-
tending that aid. There is no doubt
that the increase of production can
help the Italian economy, but if it
must result in budget deficits, and
consequently in the inflation of the
Lira, which means transferring the
burden of investments on to the back
of the small man-the worker, under
conditions in which the means of
production do not belong to the
workers, nor a worker's or a peo-
ple's state, than it is clear that such
a path can be of advantage only to
those who wish to exploit the efforts
for the reinforcement of the arma-
ments of one of the blocs.
In the governmenal political circles
Dayton's criticism was a blow for
all those who, together with Minister
Pella, for three years promulgated
the policy of defence of the Lira.
To desert that policy, now would
mean the fall of the Government.
This possibility is especially certan
because in the circles of the Christ-
ian Democratic party there are
many, who, like the Minister of In-
terior Affairs, Scelba, in alliance with
the Republican Minister of War. Pac-
ciardi, consider that the question of
the future military defence (in fact
of the present armaments) can be
solved exclusively through the deva-
luation of the Lira, and through the
increase of production with special
emphisis oct investement in the
means of production which should
be found even at the expense of ge-
neral increase of deficits.
From all the foregoing factors the
prevailing opinion in Rome is that
Dayton's criticism represents the
creation of a most serious economic
and political crisis.
B. RAFAJLOVIC
Review of
INTERNATIONAL
AFFAIRS
Published tur'ce a month by the
Federation of Yugoslav Journal-
ists.
Yearly subscription : 3 dollars,
or 16 English shillings.
Offices: International Affairs,
Teraziye 31, Belgrade.
Telephones : 28-451, 26-715, Post
Box 125.
Checking account: Yugoslav
National Bank PR Serbia Branch
103-906033.
Approved For Release 2002/01/181:6CIA-RDP83-00415R006800010001-4
4
,
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Approved For Release 2002/01/18 : CIA-RDF'83-00415R006800010001-4
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H7lOS.711-1,9 MAKEnOMIA, 1 okre 3.33
Approved For _Rilf,ilstily/o/18fEJUW81.-i 1eR006800010001-4
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Approved For Release 2002/01/18 : CIA-RDF'83-00415R006800010001-4
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