EAST GERMANY: A POLITICAL PROGNOSIS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84S00555R000200040002-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 17
• Document Creation Date: December 21, 2016
• Document Release Date: August 27, 2008
• Sequence Number: 2
• Publication Date: May 1, 1983
• Content Type: REPORT

East Germany:
A Political Prognosis
State Dept. review completed
Secret
Secret
I c 25X1
L
May 1983
Copy 5
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
25X1
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Intelligence
East Germany:
A Political Prognosis
European Division, EURA,
This paper was prepared by ]Office
of European Analysis. It was coordinated with the
Directorate of Operations and the National
Intelligence Council. Comments and queries are
welcome and may be directed to the Chief, East
Secret
EUR 83-10129C
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Secret
East Germany:
A Political Prognosis
Key Judgments Virtually immune to societal unrest for decades, East Germany has entered
Information available what we believe is a period of increasing ferment. Since the late 1970s-
as of 31 March 1983 and especially over the past 12 months-consumers have become more
was used in this report.
assertive in protesting increasingly evident shortages. At the same time,
young people have become more rebellious, an attitude that has led to
increased delinquency and youth crime, greater job dissatisfaction, and a
growing attraction to idealistic causes. Although the level of discontent is
low compared with Poland during Solidarity's heyday, it marks a sharp
departure from the traditional acquiescent behavior of East Germans.
The populace was long thoroughly cowed by the regime's pervasive security
and party apparatus. The regime gave high priority to internal order
because of its insecurity over governing the weaker, less legitimate half of
the German nation. The brutal suppression of workers' riots in 1953, the
construction of the Berlin Wall in 1961, and the continued presence of
400,000 Soviet troops convinced many East Germans that protest was
futile. Beginning in the 1970s, the new regime of Erich Honecker tried to
go beyond sole reliance on coercion and win greater acceptance by
improving the standard of living.
The new assertiveness seems largely to stem from the dashed expectations
of a populace accustomed to increases in the standard of living. Consumer
gains have slowed during the last three to five years as the regime
responded to its mounting economic problems by imposing domestic
austerity measures. Unrest in Poland apparently helped encourage grum-
bling as many East Germans enjoyed seeing a Communist regime in
disarray. The regime's willingness to tolerate some complaining as a safety
valve seems only to have encouraged more discontent.
Young East Germans in particular appear to expect the relative prosperity
they knew in the 1970s. Moreover, they are repelled by authority-perhaps
even more than rebellious Western youth-because of the totalitarian
regime's endless demands for conformity. Their involvement in Eastern
Europe's only spontaneous peace movement-the first grassroots political
movement in East Germany-is a dramatic way of resisting regimentation,
in this case expanded military training. The number of young men willing
to risk imprisonment by refusing military service is small but steadily
growing. Furthermore, we believe that the peace movement is helping to
erode discipline in the armed forces.
iii Secret
EUR 83-1
May 1983
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84S00555R000200040002-6
The regime is trying to counter the new societal ferment with its traditional
mix of persuasion and coercion. Party leaders have shifted around consum-
er goods to dampen discontent and sought to siphon off pacifist sentiment
into a "peace movement" directed by the official youth organization. At
the same time, the authorities are increasing pressure on peace activists
and their church supporters and making the police more prominent in
factories and stores. We expect this societal ferment, nonetheless, to grow,
especially as East Germany's economic problems mount. The austerity
measures-necessary because of the large foreign debt and the end of
cheap Soviet raw materials and easy Western credits-virtually ensure
that the regime cannot sustain its all-important "Consumer Communism."
Furthermore, the regime's renewed emphasis on regimentation is likely
only to intensify discontent.
We believe that the continuing economic and political problems will
sharpen friction also between party and government officials over proper
policies-including the desirability of economic reform-and widen the
gap between the Old Guard top leadership and younger, better educated
functionaries.
In the near term, we believe the regime's readiness and ability to crack
down will keep East Germany from becoming a major crisis point in
Eastern Europe. But such a course may prove counterproductive over the
longer term. Repression will undermine the leadership's long-term goal of
public acceptance, contribute to the downward economic spiral, and wreck
any hope for economic reform. In the end, the high costs of repression
might strengthen the hand of those-including younger, technocratic
elements in the party-who call for a more pragmatic approach.
In foreign affairs, the regime's anxiety over domestic problems is likely to
make it more prickly in dealing with the West, especially West Germany.
An insecure regime intent on domestic repression may also act more
assertively in areas directly affecting US interests-such as Allied access
rights in Berlin.
Secret iv - 25X1
Approved For Release 2008/08/27: CIA-RDP84S00555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Secret
East Germany:
A Political Prognosis
Three incidents over the past six months highlight
what we believe is increased discontent within the
East German populace:
? Last November, workers in a Berlin factory taunted
party officials who were trying to justify increasing-
ly evident consumer goods shortages.
? Many East Germans, according to US Embassy
sources, reacted to word of an attempted assassina-
tion of party leader Erich Honecker on New Year's
Eve-the first known attempt on an European
Communist leader's life-by praising the would-be
assassin. The assailant's alleged motive-outrage
over the party elite's privileged lifestyle-evidently
struck a responsive chord.
? Representatives of over 40 local peace groups met in
East Berlin in March in the first major attempt to
organize the nonofficial peace movement. Some
militants plan what one has called a more "action-
oriented" meeting later in the spring.
Although these incidents neither threaten the re-
gime's existence nor portend dramatic upheavals in
the near future, they illustrate, in our view, a degree
of societal ferment in East Germany not evident for
the last 30 years. Furthermore, we believe that such
actions are causing increasing concern within the
regime.
Reputation for Stability
East Germany, or the German Democratic Republic
(GDR), has long appeared to Western observers to be
one of the most stable countries in Eastern Europe.
Except for the brief worker riots of June 1953, the
East Germans have shown no inclination to take to
the streets as, for example, the neighboring Poles have
done frequently. The brutal suppression of the 1953
uprising convinced East Germans for many years, we
believe, of the futility of protest. Construction of the
Berlin Wall in 1961 further sapped the will to resist.
East Germans were disappointed that the Western
Allies failed to prevent the isolation of East Berlin and
were frustrated over the interdiction of their easy
escape route to the West. The regime's longstanding
practice of expelling the most troublesome dissidents
to the West also discouraged the formation of any
organized opposition. Finally, the continued presence
in the GDR of 400,000 Soviet troops has been an
important deterrent to protest. Knowledgeable West-
ern observers, including US Embassy officers, have
said that most East Germans, while contemptuous of
the Soviets, respect Moscow's military strength and
consider Soviet troops the ultimate guarantor of the
East German regime. 25X1
The regime has always given highest priority to
internal security and maintaining order because of its
location on the "front line" of the Warsaw Pact and in
direct contact with West Germany. Party leaders
have long been well aware of the difficulties of
competing with the larger, more prosperous Federal
Republic of Germany (FRG). The regime'knew
well-as its defensive propaganda repeatedly makes
clear to us-that the average East German continued
to view the FRG as the "real" Germany. The
attempt-reported by Amnesty International and oth-
er human rights organizations-by at least 100,000
East Germans to renounce their citizenship and emi-
grate to West Germany in the wake of the Helsinki
Accords in 1975 provided a jarring reminder that,
after almost 30 years in power, the regime still lacked
legitimacy with much of the populace.F___1 25X1
The leadership of the East German Communist party
(SED) has been united and tough minded in pursuit of
this basic goal of maintaining order, despite the
differing styles of the two party leaders who have run
the country so far. Walter Ulbricht ruled with an iron
hand for more than 20 years, constructing a Stanlin-
ist-type party and brooking no opposition to his strict
authoritarian methods. Erich Honecker
has stressed collegiality within
the top leadership. We believe that Honecker- 25X1
Ulbricht's former security chief-is just as tough as25X1
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Most East Germans have never
accepted the GDR as a legiti-
mate country, and many try to
escape by any means.
his predecessor and has emphasized collectivity large-
ly to ensure that responsibility for bad or unpopular
decisions is widely shared. Honecker's stress on colle-
giality has helped spark rumors, which periodically
appear in the West German press, of factionalism in
the top leadership, but we believe these reports are
highly exaggerated. They may be part of regime
tactics for dealing with West Germany: many tales
cast Honecker as an advocate of better relations with
Bonn who must be supported by West German con-
cessions if intra-German relations are to thrive.
The leadership has relied on massive security forces
and an extensive party apparatus to enforce its will. In
addition to the ordinary uniformed police, a workers'
militia, and militarized police units, there is a perva-
sive secret police network, comprising by our estimate
17,000 officers and 100,000 informers. A thousand-
man Central Committee staff in East Berlin directs a
party machine of 50,000 full-time and 300,000 un-
paid, part-time functionaries. The party bureaucracy
is only the most visible and important part of a party
that has over 2 million members, 20 percent of the
adult population. The party's oversight of society was
intensified in 1963, when it was reorganized by
function rather than territory. Large, specialized
staffs were established at each administrative level to
deal with key areas such as industry, agriculture, and
ideology.' 25X1
During the 1970s the party bureaucracy increasingly
sought to make its presence felt everywhere as prob-
lem spotter and solver. In the economic sphere, for
example, better educated party staffs used the net-
work of party organizations in factories to ensure
implementation of central directives and to improve
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
25X1
25X1
25X1
25X1
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Secret
Since the early 1970s, the regime has come to regard
the provision of a constantly rising standard of living
as an increasingly important "carrot" to supplement
the "stick" wielded by the party and security appara-
tuses. Party leader Honecker publicly proclaimed
consumerism as his highest domestic priority after
succeeding Ulbricht in 1971, and since then the
regime has relied on this course as its chief means to
gain legitimacy among the populace. The East Ger-
man "economic miracle" had produced by the mid-
1970s the highest standard of living of any Commu-
nist country, higher than several West European
nations. Relatively cheap Soviet raw materials and
energy were key elements in the "Consumer Commu-
nism" the regime sought to construct. So too were the
benefits to the regime when it moved to improve ties
with Bonn after 1970. Not only did the GDR gain
access to favorable credits and trade terms, but the
regime also annually received hard currency pay-
ments we estimate at roughly $1 billion for such
things as transit fees to Berlin and ransom for political
substitute technical prowess and efficiency for eco-
nomic reform. The entire top leadership has, in our
view, seemed little disposed to consider seriously any
of the notions of reform which are now abroad
prisoners.
The regime has sought to sustain this relative econom-
ic prosperity within a system that gives priority to
maintenance of political control. In the mid-1960s
East Germany's only experiment with economic re-
form and decentralization was halted by then party
leader Walter Ulbricht who, in our view, feared that
easing central controls might threaten his personal
political power. Honecker has gone even further in
reasserting central political control of the economy by
implementing the Kombinat 2 system, which tries to
S The approximately 130 Kombinate-industrial trusts which group
together related enterprises-account for virtually all of East
New Ferment Among Consumers and Youth
Since the late 1970s there has been an increasing
ferment within the populace. Moreover, we have
detected over the last 12 months a new assertiveness
which, although minor compared with events in
Poland under Solidarity, is a significant departure
from traditional East German behavior. The activism
of young people in the peace movement, for instance,
contradicts their longtime reputation for political
apathy. This ferment has not been checked and, as
both the private comments of government officials
and regime countermeasures make clear, has increas-
ingly concerned a regime that has long demanded-
and usually exacted-a high degree of obedience and
conformity. 25X1
Growing discontent among workers and consumers
can in our view be traced to increasing economic
problems. The East German "economic miracle" be-
gan to falter in the late 1970s because of numerous
difficulties-especially the increasing burden of for-
eign debt, higher energy costs, and deteriorating
terms of trade. Regime measures to boost exports and
reduce imports significantly slowed the growth in
personal consumption. In 1982, personal consumption,
by our estimate, dropped below the level of 1981, the
first such year-to-year decline during the Honecker
era.' Since the late 1970s, the populace has faced
longer lines, even for some basic foodstuffs, and has
had to contend with price increases. US Embassy 25X1
officers believe that by the middle of 1982 much of
the populace considered the "Honecker Honeymoon"
of constantly rising living standards to be over.F_~
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84S00555R000200040002-6
More flags and fewer sausages. East Germans
have come to expect their high standard of living,
and they resent the increasingly evident shnrt-
istic causes such as environmentalism.
25X1
Embassy officers report increasing re-
Young East Germans also seem more willing to
behave in ways that are unacceptable to the regime:
? About 70 percent of the 4,500 to 5,000 political
prisoners in the GDR in 1981 were under the age of
28, according to Western human rights organiza-
tions such as Amnesty International. Of these,
almost half came from the families of SED mem-
bers, and most were jailed for trying to escape the
country.
there 25X1
has been an unmistakable, continued rise in street
crime by youth since the mid-1970s despite increas-
ingly strict laws against "hooliganism" and "para-
sitic elements."
? Poorly motivated young workers, according to the
public complaints of regime officials, account for
much of the absenteeism, failure to fill work norms,,
and on-the-job accidents.
? Young people comprise the bulk of the growing
unofficial peace movement-the first grassroots po-
litical movement in East Germany's history and the
only significant peace movement in Eastern Eu-
rope-and are increasingly attracted to other ideal-
Aside from frustration over stagnating living stand-
ards, the populace may have been roused by events in
Poland, despite traditional German antipathy toward
Poles and the tendency of many GDR citizens to
scorn "disorder." Embassy contacts,, for example,
make clear that many East Germans vicariously
enjoyed seeing the Polish Communist regime in disar-
ray. The regime's toleration of mild consumer grum-
bling as a safety valve may only have encouraged
greater outspokenness. Honecker's leadership style-
particularly his effort to contrast his down-to-earth
image with Ulbricht's stern aloofness-may also have
contributed to the notion that the regime was becom-
sentment of the privileged, especially party members
who use special connections to secure scarce consumer
items or those people who are able to get West
German Marks and buy luxury goods in the regime-
sponsored hard currency "Intershops."
At the same time, the authorities have also faced
increased ferment among a more rebellious youth.
East German emigres tell West German interviewers
that young adults aged roughly 18 to 24 are much
more critical of the system than their elders when
they were young. A veteran foreign observer notes, in
a recently published book on the GDR, that young
people more readily break the taboo of talking about
"the Wall," comparing East Germany to a concentra-
tion camp and generally conveying a sense of feeling
25X1 "locked in."
ing more tolerant.
Approved For Release 2008/08/27: CIA-RDP84S00555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Secret
25X1
East German "punkers" lounging in front of the Palast der
Republik are a vivid symbol of youth rebelliousness in the GDR.
Although East German youth ferment is part of a
worldwide phenomenon-which in the West dates
from the late 1960s-it has its own particular roots.
Young East German peace activists, for instance,
undoubtedly were inspired by West European antinu-
clear protesters, but international issues are not their
main concern. An analysis of their grievances suggests
a rebellion primarily against regime efforts to impose
strict conformity-most recently increased military
training. In addition, some East German youths con-
sider the peace movement as a vehicle to further
German reunification. Juvenile delinquency undoubt-
edly represents another form of alienation from the
stifling demands of East Germany's totalitarian state.
Consumer shortages have probably weighed most
heavily on young workers, who knew only the relative
prosperity of the 1970s. The country's economic prob-
lems have made it more difficult for young East
Germans to find attractive jobs, judging by reports of
emigres and legal travelers. A government official
admitted in a published speech in 1980 that, despite
the regime's emphasis on "scientific-technical prog-
ress," about 100,000 young workers with technical
training were unable to find suitable work.
25X1
The Peace Movement
The most important form of youth rebellion has been
the growing opposition to military service and the
advocacy of nuclear disarmament. A small group of
conscientious objectors that began demanding alter-
natives to compulsory military service in early 1981
has grown into a movement-not yet organized na-
tionwide but making steps in that direction in 1983-
that has been able to draw as many as 5,000 partici-
pants to a single event, despite the presence of security
forces. We have no firm figures on the size of the
movement, but estimate that 10,000 to 15,000 people
may have participated in one or another meeting or
workshop sponsored by local peace 'groups throughout
the country. 25X1
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
The peace movement's continued growth has been
aided by support from the normally cautious East
German Evangelical (Lutheran) Church, under whose
auspices peace activists have been able to meet legally
for "religious purposes," even though many of the
young people are not communicants. The upsurge in
pacifist sentiment among youth has dovetailed with
the Church's larger public role and a growing asser-
tiveness on political and social issues by some younger
clergy. The Church's decentralized structure has giv-
en local Church militants more opportunities for
action, which, in turn, has forced the cautious hierar-
chy to be more supportive. Although many Lutheran
Church leaders are anxious to avoid a confrontation
with the regime that would jeopardize gains made in
recent years, the Church shows no sign of withdraw-
ing its support of the peace movement. Church lead-
ers, in our view, probably have come to believe that
such support is their moral duty and increases the
Church's credibility with the populace, especially the
young people.
The Catholic Church has also come to support the
peace movement in response to grassroots pressure
and, the urging of the
Pope. A strongly worded pastoral letter by-the East
German bishops read from pulpits on 2 January 1983
said pacifists' demands for alternative service were
justified. Although the Catholic Church is likely to be
very cautious about assisting the peace movement too
openly, its continued support would significantly en-
courage peace activists and take some burden off the
Lutheran Church.
The peace movement, in our view, is becoming the
driving force behind what seems to be growing resist-
ance to military service. Peace groups counsel draft-
eligible young men on their options to military service
and on avoiding service in combat units. The number
of young men willing to risk imprisonment by refusing
service is small but growing; as of January 1983 we
knew
of 100 draftees or reservists claiming to be pacifists,
up from 42 in September 1982. For even one young
East German to defy the regime in this manner shows
extraordinary courage; publicity could encourage oth-
ers to resist military service or to join noncombatant
units.
A patch depicting a sword being beaten into a
plowshare-based, ironically, on a Soviet statue
given to the UN-is the symbol of the nonofficial
peace movement. The regime has banned the
peace patch, fearing it could become as popular
The peace movement may also be helping erode
discipline in the armed forces. The formation of penal
units in the Army for the first time in October 1982
suggests disciplinary problems are becoming more
troublesome for East German commanders. More-
over, public statements by senior officers during the
past year have increasingly stressed the need for more
ideological indoctrination of the troops, giving it
precedence in some cases over weapons training.
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84S00555R000200040002-6
Secret
25X1 over shortcomings in discipline.
Regime Response
We believe that the leadership regards this discontent
as a serious problem because of the regime's great
insecurity and insistence on total conformity. The
leadership's siege mentality was intensified by the
year that the leadership seriously viewed the peace
movement-and its effort to establish an identity by
adopting an emblem depicting swords being beaten
into plowshares-as a potential political opposition
similar to Solidarity.
onset of the Polish crisis.
The government official responsible for
Church affairs frankly told the US Ambassador last
The SED leadership has reacted to this ferment with
its traditional mix of persuasion and coercion. Party
leaders have shifted goods to areas of greatest con-
sumer discontent and have made a special effort to
boost supplies temporarily for special occasions. In
October 1982, Honecker overruled opposition within
the Politburo, according to Embassy sources, and
ordered increased supplies of meat and other desirable
Approved For Release 2008/08/27: CIA-RDP84S00555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
foodstuffs for the Christmas holidays.
East Germah children learn to drive miniature
tanks and to throw handgrenades in the regime's
premilitary training program. Resistance to this
training by students, their parents, and the clergy
special security forces ended a work stoppage in East
Berlin in late 1982, according to
Embassy contacts, by promising the prompt delivery
of more consumer goods. More recently the authori-
ties-apparently anticipating continued austerity-
have been uttin more emphasis on coercive meas-
ures. the police are
conducting more obvious surveillance in factories and
in stores. The government is also expanding the
Workers' Militia-a paramilitary organization creat-
ed in factories after the 1953 riots to help maintain
25X1 order.
25X1
25X1
The regime is trying to nurture its own peace move-
ment, relying on the official youth organization, Free
German Youth (FDJ), to organize peace activities
that it hopes will siphon off support from spontaneous
peace activism. In February 1983 the FDJ staged a
large peace rally in Dresden to preempt action by the
unofficial peace movement. We believe that such
"peace demonstrations," by ignoring Warsaw Pact
armaments, are transparent and that East German
youths discount them.
Since early 1983 the regime has increased pressure on
peace activists and their church supporters, according
to US Embassy contacts
More draft resisters are being jailed, often in
the same cells as hardened criminals, and others are
being involuntarily expelled. Soon after the Catholic
bishops' pastoral letter, East German media harshly
attacked critics of the regime's militarization policies,
singling out those "directed by Rome." The authori-
ties also upbraided the leading Lutheran bishop for
"allowing" publication in the West of a women's open
letter to Honecker protesting a law that subjects them
25X1 to military service during "national emergencies."F-
A combination of foreign and domestic constraints
has, in our view, prevented the regime thus far from
trying to crush the peace movement outright-as it
might have done 10 or 15 years ago. Above all, the
GDR wants to avoid actions that embarrass Warsaw
Pact efforts to cultivate the West European peace
movement and to foster opposition this year to INF
deployment. Furthermore, Honecker does not want to
damage relations with the Lutheran Church hierar-
chy, which improved after 1978 as he sought to woo
the Church away from its connections to West Ger-
many. In particular, the government does not want to
jeopardize extensive plans for commemorating the
500th anniversary of Martin Luther's birth this year,
celebrations aimed at enhancing regime legitimacy as
well as earning badly needed hard currency from
Western tourists.
We believe the leadership intends to try to enforce
greater discipline among young people over the longer
term by making greater use of the military as an
instrument of socialization. A revised military service
law of May 1982 increases the number of times
reservists may be called up, provides for compulsory
service for women, and also obligates schools, fac-
tories, and social organizations to "prepare" young
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Secret
men for military service. Compulsory premilitary
training in schools-introduced in 1978 for 15- and
16-year-olds-may also be expanded to include youn-
ger boys and girls, even though such training has
sparked youths, their parents, and the Lutheran
Church to complain to school authorities and petition
government officials.
1983-appear to have top priority now,
he factors
a ma a onec er's consumerism for much of
the 1970s-relatively cheap Soviet energy and raw
materials combined with the ready availability of
Western capital-will not be replicated in the 1980s.
25X1
The authorities also seem to be banking on the official
youth organizations to try to play an even larger role
in monopolizing the leisure time of the younger
generation and instilling more discipline. The Society
for Sport and Technology (GST) has the primary goal
of preparing the younger generation for military
service. The 500,000 members of the GST train in
markmanship, parachuting, and driving heavy vehi-
cles, and bivouac in association with regular troops.
The GST offers a way to qualify early for a driver's
license, something attractive to many young people.
The FDJ and its affiliated "Young Pioneers"-which
together claim 4 million members, or two-thirds of all
children and young adults-have long offered young
people many privileges, including travel, recreation,
and easier entry into the SED. The FDJ leadership,
seeking to appear more responsive to the demands of
young people, has become more attentive to solving
local grievances such as building youth centers. More
important from the regime's viewpoint, the FDJ has
created "police helper" units, probably to help combat
juvenile delinquency.
By our assessment, the official youth organizations
remain marginally useful tools in the regime's cam-
paign to reassert control over restless young people.
The FDJ's best efforts have not touched a hard core
of over 30 percent of youth who by the regime's own
statistics have not joined the organization. Its inflexi-
ble, superannuated leaders seem unable to design
programs that would attract young people who have
become increasingly sophisticated because of their
constant exposure to West German media.
Problems To Continue
We expect societal ferment to continue as East Ger-
many's economic problems intensify. Austerity meas-
ures to ease the burden of the foreign debt-which we
estimated at nearly $12 billion at the beginning of
the Soviets contin-
ue to insist on higher prices for their raw materials
and refuse to pay higher prices for East German
products. Many East German contacts of the US
Embassy point to Soviet leader Andropov's stress on
economic efficiency and discipline and wonder if that
presages inter alia a Soviet demand that Moscow's
East European partners balance trading accounts.
Continuing demands by Moscow to improve its terms
of trade would severely restrict the SED leadership's
efforts to increase domestic consumer supplies.
25X1
Western bankers-made wary by their overexposure
in Eastern Europe-show no inclination to resume
lending to the GDR, at least in the amounts they
provided during the 1970s. East Berlin realizes that if
the political climate is right, West German banks
would be more willing than other Western banks to
extend credits the GDR may need to prevent a
liquidity crisis or even, possibly, a humiliating re-
scheduling of its foreign debt. Moreover, Bonn is the
only likely source of capital for the expensive invest-
ments the GDR needs to modernize its economy. East
Berlin expects that the Christian Democrats will be
much tougher negotiators than the Social Democrats
and will demand greater political concessions for
further economic and financial aid. Honecker, for
instance, told the US Ambassador at his farewell call
that it was no "state secret" that he would rather deal
with the former coalition. We believe there is little
chance that East Germany will receive anything like
the sums that previously helped sustain its consumer-
oriented policies. 25X1
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
25X1
25X1
As a result, we think consumers may resort more
often to sporadic protests. Disgruntled young people
seem likely to take the lead in expressing their
unhappiness over the economic situation and in resist-
ing regime efforts to enforce conformity. Enthusiasm
among young people for the peace movement shows
no signs of abating, and the longer the peace move-
ment operates, the more it could erode one of the
regime's chief deterrents-namely, the threat of swift
punishment. Many more young people who previously
rejected the regime's wooing, and who in their isola-
tion retreated into apathy, might now find new hope
and moral support in the peace movement or, increas-
ingly, in the advocacy of environmental issues. These
spontaneous initiatives will, at minimum, nurture
pluralistic tendencies and accustom increasing num-
bers of citizens to independent social activism.
Regime Stresses
We believe that these continuing economic and politi-
cal problems will intensify underlying stresses within
the regime. There already have been signs of conflict
among competing interest groups over allocation of
increasingly scarce resources.
The
resignation of the Minister of Agriculture
suggests that he may have been made a scapegoat for
25X1 deteriorating agricultural production.
general increase in friction between party and govern-
ment officials as a consequence of the country's
economic difficulties. Several senior economic manag-
ers were fired last fall
partly for resisting what they considered meddling by
party cadres. Top party officials have increasingly
stressed the importance of greater party control and
increased propaganda exhortation.
25X1 well-known economist last summer for advocating in
an officially sponsored youth magazine a relaxation of
the ideological demands on talented university stu-
dents to allow more technical training.
Furthermore, recent evidence suggests that the more
orthodox SED leaders are increasingly concerned
about the political "reliability" of younger, more
pragmatic party bureaucrats. For example, in an
article last fall in the Central Committee journal for
party functionaries, the deputy chief of the powerful
Berlin party organization noted with concern that
only 10 percent of the leading party officials charged
with oversight of the economy had held their positions
for longer than 10 years. He expressed the fear that
those who had experienced only the more favorable
conditions of the 1970s were out of touch with the
reliable methods learned by the party during its early
struggles. In an attack reminiscent of those on "mana-
gerialism" in the mid-1960s, he criticized these lead-
ing officials for paying lipservice to the party line and
concentrating on "practical matters." The message
seems to be that the party must rely on experience,
not innovation or reform. 25X1
economic pragmatists.
We believe that these concerns about maintaining
orthodoxy and tightening controls reflect a growing
gap between the Old Guard party leaders and youn-
ger, better educated officials, especially in the govern-
ment. Our tally of the Central Committee's member-
ship shows that 76 of its 208 members are drawn from
the government's technical and managerial ranks-an
increase of 37 percent since 1971. The government's
experts may enjoy greater perquisites because they
belong to the Central Committee, but they remain
excluded from real power. The top SED leadership is
still composed mainly of elderly men-with back-
grounds in security affairs, ideology and propaganda,
and party organizational work-who are wary of the
increasing number of technocrats. The few technical
specialists in the Politburo are nonvoting candidate
members. Full Politburo member Mittag is a possible
exception, but even he seems to us more politician
than technocrat; he has always championed central
party authority and occasionally has harshly attacked
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
secret
Seemingly intractable economic difficulties may help
coalesce the vague sentiment for economic reform
that we detect among some younger, lower level
officials. The most telling criticism of the Honecker
practice of dealing with one problem while ignoring or
exacerbating others could come from working-level
technical and other managerial elite who might argue
that the strategy is untenable. The critics could argue
that the only way to maintain consumerist policies
and to deal with finance and trade problems is
through systemic reform that improves investment
efficiency, worker productivity, and managerial re-
sponsibility. They look to the Soviets to take this lead.
Recently, some` Embassy'contacts in party institutes
spoke positively-but perhaps too optimistically-
about "real" economic reforms in the Soviet Union.
They expect such reforms inevitably would be "dupli-
cated" in the GDR regardless of the conservative
party leadership's preferences.
Outlook
Even though the SED's reputation for being comfort-
ably in control is likely to suffer as party leaders
struggle to deal with economic and political problems,
we do not expect East Germany to become a major
crisis point in Eastern Europe. Instead, we anticipate
an increasingly neuralgic leadership to tighten down
on an increasingly disaffected populace. Anxiety over
domestic problems is likely to make party leaders even
more prickly regarding relations with the West-
especially with the FRG if the regime feels the Kohl
government is trying to press for political advantage.
The regime may also be more inclined to assertiveness
in such sensitive areas as the Western Allies' access
rights to Berlin. It could, for example, increase the
harassment of US diplomats at Checkpoint Charlie.
Over the short term, the-party elite should remain
united in the pursuit of domestic repression. Such a
policy would secure the tight control over society that
commands top priority among all party officials-
hardliners and would-be reformers alike. And a
clampdown could be pressed with relative ease be-
cause most of the populace, in our view, would still be
A clampdown, however, could exact a heavy price on
the regime over the longer term. The gap between the
rulers and the ruled-especially the younger genera-
tion-would widen significantly, undermining the
leadership's long-term goal of public acceptance. It
would further depress worker morale and contribute
to the downward economic spiral. It could accentuate
differences within the party elite and increase pres-
sure for more pragmatism, especially after the
Honecker succession. A climate of repression would,
in our view, wreck any efforts at major economic
reforms, further alienating increasingly large num-
bers of technocrats. 25X1
The high costs of repression might buttress the argu-
ments of those who call for more pragmatism and
increase their influence in the party. Such men might
be more inclined to improve relations with the FRG
and-to the extent that they were not dependent on
the Soviets for their positions-to defend East Berlin's
particular economic and political interests vis-a-vis
Moscow more vigorously. At minimum, the rise of
those more innovative could increase divisions among
party leaders about what overall course to chart. A
more innovative top SED leadership-something that
we consider possible but not highly likely-would go a
long way toward establishing the regime on new, more
easily intimidated by the security forces.
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
 Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6
Secret
Secret
Approved For Release 2008/08/27: CIA-RDP84SO0555R000200040002-6