POLAND'S PROSPECTS OVER THE NEXT 12 TO 18 MONTHS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85T00176R001000150007-3
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 26
• Document Creation Date: December 21, 2016
• Document Release Date: June 13, 2008
• Sequence Number: 7
• Publication Date: March 25, 1982
• Content Type: SNIE

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Director of
Central
Intelligence
Secret
Poland's Prospects
Over the Next 12 to 18 Months
Special National Intelligence Estimate
Secret
SNIE 12.6-82
25 March 1982
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SNIE 12.6-82
POLAND'S PROSPECTS
OVER THE NEXT 12 TO 18 MONTHS
Information available as of 25 March 1982 was
used in the preparation of this Estimate.
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THIS ESTIMATE IS ISSUED BY THE DIRECTOR OF CENTRAL
INTELLIGENCE.
THE NATIONAL FOREIGN INTELLIGENCE BOARD CONCURS,
EXCEPT AS NOTED IN THE TEXT.
The following intelligence organizations participated in the preparation of the
Estimate:
The Central Intelligence Agency, the Defense Intelligence Agency, the National Security
Agency, and the intelligence organizations of the Departments of State and
the Treasury.
Also Participating:
The Assistant Chief of Staff for Intelligence, Department of the Army
The Director of Naval Intelligence, Department of the Navy
The Assistant Chief of Staff, Intelligence, Department of the Air Force
The Director of Intelligence, Headquarters, Marine Corps
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CONTENTS
Page
KEY JUDGMENTS .................................................................................................... 1
I. INTRODUCTION ........................................................................................ 5
II. THE ROAD TO MARTIAL LAW ............................................................. 5
III. THE PRESENT SITUATION ..................................................................... 6
A. Internal Political Affairs ......................................................................... 6
The Regime ............................................................................................. 6
The Party ................................................................................................. 8
Solidarity ................................................................................................. 8
The Church ............................................................................................. 8
B. Economic Problems ................................................................................. 9
Production ............................................................................................... 9
Food Supplies and the Farmer .............................................................. 9
Economic Relations With the West ...................................................... 10
Economic Strategy and Reform ............................................................. 10
C. External Forces ....................................................................................... 11
USSR ........................................................................................................ 11
Eastern Europe ....................................................................................... 12
The Western Alliance ............................................................................. 13
IV. PROSPECTS ................................................................................................. 14
Economic Stabilization ........................................................................... 14
The Containment of Large-Scale Violence ........................................... 14
Political Tactics ....................................................................................... 15
Evolution of the Regime ........................................................................ 16
V. IMPLICATIONS ........................................................................................... 16
Implications for Poland .......................................................................... 16
Implications for the USSR and Eastern Europe ................................... 17
Implications for the United States ......................................................... 17
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KEY JUDGMENTS
The imposition of martial law in Poland has permitted the regime
to attain its minimal objectives of restoring centralized political control,
suppressing Solidarity, and generally maintaining public order. How-
ever, martial law has not forged any sort of national consensus or
stopped the economic decline.
The decision to impose martial law has ruled out genuine political
accommodation based on power sharing as a possible solution to the
Polish crisis within the next 12 to 18 months. The range of conceivable
outcomes now runs from limited accommodation through a prolonga-
tion of the national political stalemate to repression even more extensive
than that currently practiced. While the possibility of a lowering of
public expectations and accompanying moderation by the regime exists,
most of the near-term contingencies that the regime is likely to confront
will probably push it toward continued repression.
Moscow is pleased that the Polish regime has regained political
control and suppressed Solidarity. Throughout the Polish crisis, Mos-
cow's basic concerns have been to preserve Poland as a member of the
Warsaw Pact and to restore the party as the dominant political force
within Poland, while minimizing the Soviet Union's overt involvement
in repression. The USSR desires, largely for ideological reasons, to have
the Polish Communist party act as the leading force. Nevertheless,
because of deep disarray in the party and the inherent instability of the
situation, the Soviets-despite their misgivings-probably will continue
for some time to accept the military's dominant role in governing
Poland. Moscow will not resort to direct military intervention unless the
Polish regime loses political control and the security situation deterio-
rates sharply.
Martial law is unlikely to be fully lifted during the next 12 to 18
months. The restoration of the traditional power structure emphasizing
the party's leading role will not occur quickly or easily and may become
a source of tension over the next several years. Even when martial law is
ended, the military may see a need for continuing its own role in
political and administrative affairs, especially if the party and govern-
ment are unable to develop coherent and effective programs, remain
divided, and show little ability to exercise control.
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The decisionmaking structure that has emerged is a transitional
military/party/government hybrid. The regime is divided and factiona-
lized, with hardline forces likely to gain ground over the coming
months. For political and economic reasons, the Polish leadership will
be especially vulnerable to Soviet pressure and will demonstrably stress
its ties with Moscow.
The regime realizes that any progress toward creating meaningful
links with the population, especially the workers, is closely tied with the
revival of some trade union activity. Yet it remains divided over the
issue. The moderates will continue to advocate the creation of unions
with limited independence. The hardliners, on the other hand, will push
for the re-creation of the more traditional, "conveyor belt" model not
much different from that which existed before August 1980. Neither
side appears to be strong enough to force the issue, and there is little
likelihood that the problem will be resolved during the next 12 to 18
months.
The Church in Poland is in a weaker position than before the
imposition of martial law. Its most pressing concern is preventing
bloodshed and a Soviet military intervention; consequently, it has
avoided becoming the focal point of active resistance to martial law. If
there is severe regime repression of society, the Church will feel
compelled to speak out more forcefully.
The regime appears to be pursuing an economic strategy of
coercing enough output from a crippled economy and a beleaguered
population to ease Poland's financial problems with the West and to lay
the basis for an economic recovery. However, the economic situation
continues to deteriorate, largely as the result of shortages of Western im-
ports. It is uncertain whether further economic decline can be halted at
a level that will provide a tolerable standard of living for the popula-
tion. Although famine is not a likely prospect, the food outlook for the
next 18 months is bleak, with a possible crisis looming by late spring as
the regime may not be able to meet the urban population's require-
ments for food.
Warsaw still confronts staggering debt service obligations to the
West, and will be unable to make any significant principal payments for
the foreseeable future on its $27 billion debt. Warsaw will probably
choose to pay as much as it can on its interest obligations to private
banks-its most impatient creditors-while forgoing other payments
due on its debt. Its inability to meet much of the estimated $2.5 billion
interest due banks in 1982 means that the risk of default will continue to
grow.
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Warsaw's problems are being further exacerbated by the impact of
Western sanctions, which will deepen Poland's financial morass and
reduce vital imports. Sanctions will tend to make Warsaw more
dependent on Moscow and its CEMA partners. Jaruzelski is thus faced
with the choice of presiding over a deeper and more permanent
integration of the Polish economy into that of the Soviet Union or of un-
dertaking the political measures necessary for the lifting of sanctions.
If Poland were forced into default, this would have a limited
impact on its economy in the short run. But, it could, at the very least,
delay and complicate Poland's attempt to join the IMF, thereby
postponing important financial assistance. It would also have an
important impact on the ability of other CEMA countries to gain
Western credits and would damage their trade ties with the West.
The chances that unorganized violence will occur in the-coming
months are very high. The widespread expectation among Poles that
more open resistance will come with warmer weather will probably
prompt some to engage in violent acts. In anticipation, the regime will
have to continue the use of repressive measures. If spring passes without
a major upsurge of resistance, there could be a psychological letdown
among the populace that would increase the government's chances for
averting widespread violence for a while.
The substantial and well-trained forces of the Ministry of Internal
Affairs have acted effectively in implementing martial law, and we
believe they-with the continuing support of the Army-have a good
chance of maintaining order. If the situation deteriorated, the regime
would probably employ the Army in a more active role but would
choose those units selected and trained for such a role. In a situation in
which there was a total breakdown of order, which we consider highly
unlikely, the regime would have to contemplate using military units
whose reliability in a violent confrontation with the population has yet
to be tested. We do not believe that it will come to this as the Poles have
sufficient forces to handle successfully most contingencies that could
arise. Thus the likelihood of a Soviet military intervention is slight.
Moscow remains willing, however, to move in should the regime fail.
Moscow's concern about the willingness of Polish Army and
internal security units to maintain control in Poland probably has been
allayed by the forces' effective performance in implementing martial
law. The Soviets probably have some doubts, however, about the ability
of the regime to mobilize Poland if it were called to support military
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operations against NATO. These concerns may cause some adjustment
in Soviet operational planning, but, unless the Polish situation deterio-
rates radically, the Polish role in Warsaw Pact war-fighting strategy will
probably not change.
The United States has the means to produce a significant economic
impact on Poland. But this capacity does not mean that the United
States has great leverage over the Polish regime or the Soviet Union in
determining the outcome of political events in Poland. US influence in
this respect is highly constrained by the stake which both Warsaw and
Moscow have in restoring a reliable system of Communist rule in
Poland.
Over the next 12 to 18 months and beyond, the Polish crisis has a
large potential to affect the Atlantic Alliance, ranging from a major
disruption to some solidification. In the present martial law situation,
the West Europeans have made the same formal demands on the Polish
regime as the United States, but they will not insist on the same strict
compliance as Washington. The Allies probably would be inclined to try
to improve their relations with Poland if the Polish regime took some
further steps to end martial law, released most internees, and initiated
the semblance of a dialogue with the Church and selected Solidarity
representatives-all quite conceivable regime tactics. In that case, it is
unlikely that punitive measures taken thus far against the Soviet Union
by the West Europeans would be sustained for long.
In sum, within the next 18 months, the West cannot hope that any
of its actions will lead to genuine political accommodation in Poland.
The West can hope that the combination of Soviet and Polish need for
Western economic cooperation, steadfast Western rejection of business
as usual, and continued passive resistance to the authorities by the Polish
population will have some moderating influence on the regime and
maintain the possibility of long-term compromise within Polish society.
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DISCUSSION
1. The imposition of martial law by the Polish
regime on 13 December 1981, with Soviet approval
and encouragement, conclusively demonstrated the
regime's willingness to use force in order to ensure its
political domination and brought a halt to an increas-
ingly open national discussion of the country's future
political and economic course. The purpose of intro-
ducing martial law was fundamentally political, not
economic-to attempt to end the threat to Communist
party control in Poland by use of the Polish military. It
was designed to suppress the principal opponent of the
party, Solidarity, and to instill a sense of fear in the
Polish population. To deny Solidarity the ability to
reorganize in opposition to the regime, the Polish
authorities moved quickly to arrest most of Solidarity's
leaders and many of its most active supporters. The
effect of martial law has been to put an end to any
idea of genuine power sharing, to deny the population
a broad range of civil rights, and to suspend union
activities-including the right to strike, which had
been granted by the 1980 Gdansk Accords.
2. Using his unprecedented combination of posts-
party and government head as well as Defense Minis-
ter-General Jaruzelski established military control
over the decisionmaking process in Poland by creating
a ruling Military Council of National Salvation and by
placing his military subordinates in key positions in the
governmental ministries. This step was not a military
coup. Its Soviet and Polish authors saw the military
functioning as the administrative arm of the ineffectu-
al Polish United Workers' Party-the official name of
the Communist party in Poland. Draconian martial
law measures, however, have yet to solve any of the
fundamental political and economic problems that
brought about the rise of Solidarity in 1980. The
purpose of this Estimate is to identify probable devel-
opments in Poland in the next 12 to 18 months, to
examine how the key internal institutions-military,
party, Solidarity, Church-and the external forces-
the Soviet Union, Eastern Europe, and the West-will
affect the outcome, and to assess the stability and
effectiveness of the system that we believe is likely to
emerge.
3. Jaruzelski publicly justified the imposition of
martial law as necessary to preserve the Polish state,
prevent a civil war he declared was imminent, and
end the economic chaos that he claimed was bringing
the country to its knees. These rationalizations not-
withstanding, the true purpose of the action was to
protect what remained of the traditional system of
Communist rule. During the 16 months after the
formation of Solidarity, the party's ability to rule had
progressively deteriorated. By the time martial law
was imposed, the party had lost a great deal of its
cohesion, was fragmented, and was unable to meet
Solidarity's political challenge.
4. The contradictions and irresolute behavior of a
regime in disarray and of a factionalized party signifi-
cantly exacerbated the political situation in the months
preceding the imposition of martial law. A deteriorat-
ing economic situation, due only in small part to
strikes, and rising public anger over the lack of a
nationally acceptable government program made it
harder for the moderate Solidarity leadership to re-
strain its members and led it to devise its own
programs. Eventually, increasingly political demands
on the part of Solidarity-including free elections-
posed a clearly perceived threat to the system, to the
positions of thousands of Polish officials, and, in the
longer term, to Communist rule in the Warsaw Pact
countries. The regime's unwillingness to commit itself
in good faith to institutionalize most reform measures
or to implement fully promises already made to
Solidarity contributed in a major way to a weakening
of moderates and strengthening of radicals within the
Solidarity leadership. This trend was then used by
Jaruzelski to justify the imposition of martial law. The
factors that prevented the regime from accepting a
serious democratization of society before 13 Decem-
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ber-namely the reluctance in Polish ruling circles to
share power and insistent pressure from Moscow-are
still present, and will make the achievement in the
future of a negotiated resolution of the ongoing crisis
exceedingly difficult if not impossible.
III. THE PRESENT SITUATION
A. Internal Political Affairs
The Regime
5. The Polish leadership's use of force against its
challengers and reassertion of physical control has only
initiated a protracted process of establishing a more
stable political system. Institutionally, the existing
political structure is a military/party/government hy-
brid. The Military Council of National Salvation,
comprising 20 mostly senior officers, is formally the
highest ruling authority. It lays down martial law rules
and reportedly makes regulations and the more impor-
tant policy choices. A smaller, informal core leader-
ship group including representatives from the Military
Council, the party Secretariat, and the Council of
Ministers is said to make day-to-day decisions and
consider long-term options (see table). Military over-
seers have been placed in factories, schools, and
government ministries, and some officers have taken
over direct control as provincial governors or enter-
prise managers. The police and security services also
are very active and influential, and are executing the
Members of Poland's Core Leadership and Their Affiliations a
Military
Council of
Core Leaders National Party
(Primary Responsibilities) Salvation Politburo
Gen. Wojciech Jaruzelski
(party, government, and
defense chief) X b X
Lt. Gen. Florian Siwicki
(Chief of Staff) X X
Lt. Gen. Czeslaw Kiszczak
(Minister of the Interior) X X
Maj. Gen. Michal Janiszewski
(Chief, Office of the Council
of Ministers)
Kazimierz Barcikowski (party
monitoring of government?)
Gen. Brd. Miroslaw Milewski
(party monitoring of security
affairs?)
Stefan Olszowski(party oversight
of ideological affairs and media)
Zbigniew Madej (economic
planning)
Janusz Obodowski(general
economic affairs)
Ministry Council of Party
of Defense Ministers Secretariat
Mieczyslaw Rakowski
(sociopolitical affairs) - . -
a Information based on various, sometimes conflicting reports.
b Chairman.
Minister.
d First Secretary.
e Candidate member.
r Ministerial rank.
g Deputy Chairman.
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bulk of martial law security functions. Nevertheless,
the civilian bureaucracy continues to function and
some party leaders, although not the party as an
institution, are playing important roles.
6. The key military and civilian decisionmakers
seem to be united in their pursuit of certain minimal
martial law objectives:
- To restore centralized political control.
- To prevent the reconstitution of Solidarity in its
pre-martial-law form.
- To maintain public order and discipline.
- To stop the economic decline and get Poles back
to work.
There is a common recognition that failure to achieve
these goals by internal means would probably lead
eventually to Soviet military intervention. But, beyond
these minimal objectives, there are serious disagree-
ments between moderates and hardliners within the
regime over the ultimate type of desired political
order, the eventual disposition of Solidarity internees,
and the character of economic reforms. Badly divided,
the regime has been unable so far to articulate clear
policy lines.
7. Despite its hierarchical nature, the Polish mili-
tary is not unified in its approach to solving Poland's
problems. Some of its key leaders wanted to impose
martial law earlier than Jaruzelski. Within the mem-
bership of the Council of National Salvation there
reportedly are differences of view with respect to
relations with the Soviets, the pace and extent of
relaxation of martial law restrictions, and the degree of
reform to be tolerated. Deputy Minister of Defense
Molczyk and six other members apparently are espe-
cially hardline and pro-Soviet. Despite these divisions
within the Council, Jaruzelski reportedly has been able
to dominate it. Still, the Soviets may use the more pro-
Moscow members of the Council to pressure Jaruzelski
and probably will seek to cultivate the support of other
members.
8. Within the party, adherents of the moderate
position, with which Deputy Chairman of the Council
of Ministers Rakowski has been associated, believe that
some of the incipient reforms begun after August 1980
must be continued. Yet the moderates have not come
forward with specific proposals. They were ambiva-
lent before martial law on what institutional changes
were acceptable and probably feel themselves now to
be in a weak and exposed position. The hardline
stance, expressed most openly by Politburo member
Siwak, is clearer in that it rejects the changes made
since August 1980, calls for a leaner party led by
ideologically pure cadres, and supports harsh measures
aimed at crushing all resistance, purging liberals in all
sectors, and forcibly introducing economic austerity.
9. Jaruzelski-by all accounts an enigmatic figure
difficult to pigeonhole-is considered by some Poles,
to be a 25X1
"moderate" or "pragmatist" and not a Soviet puppet.
We know that in the past, on occasion, he has resisted
strenuous Soviet pressure. Nevertheless, his purported
accomplishment of averting the worst-a Soviet inva-
sion-was achieved only by doing what the Soviets
wanted. Consequently, other Poles consider him a
Soviet surrogate. Jaruzelski has tried to adopt a posture
of standing above the fray, and has managed so far to
work with both the hardline and moderate elements in
the leadership. While there are those within the
Council and the party who believe that Jaruzelski's
policies have not been stringent enough, they have not
gathered the necessary support to undercut him. The
Soviets may have had some reservations about Jaru-
zelski before the imposition of martial law; however,
its successful implementation surely pleased them.
They have since been supportive of him and are
apparently giving him more time to deal with Poland's
problems. It is not clear, however, that Jaruzelski has
sufficient political savvy to maneuver people along a
predetermined long-range course of action. Jaruzelski
is certainly aware that Moscow will continue to assess
his performance, and, if his policies appear to be too
compromising, nationalistic, or unresponsive to the
USSR, it will seek to have him replaced. In general, on
the fundamental issues of control and Poland's role in
Warsaw Pact operations, Jaruzelski has no essential
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The Party
11. Both moderates and hardliners hope to use the
period of martial law to weaken their opponents.
Nevertheless, martial law has given the hardliners
within the party the opportunity to undercut the
influence of, or purge, those who had pushed for
reforms or had been identified with Solidarity. While
further purging controlled by hardliners would make
the party a more centralized instrument of power, it
would further discredit the regime, narrow its policy
options, reduce its capacity to deal effectively with the
acute problems that now confront Poland, and thereby
increase the likelihood of a future violent upheaval.
12. Jaruzelski probably has serious doubts about
relying on the party in its present weakened state. He
has been on the Politburo for 14 years and has been
reared to accept the primacy of the party; yet he has
seen the Polish party fail over the past decade to
devise workable policies.
e has become even more aware of
the extent of corruption and inefficiency in the gov-
erning system dominated by the party. He probably
has few illusions about how quickly that can be
changed, even though he is trying to emphasize profes-
sional competence by introducing military cadre prac-
tices into the party. As a party outsider, Jaruzelski will
probably continue to act as an arbiter within the party
between conservative and moderate elements. In com-
ing months he could come increasingly under attack
from conservatives for not withdrawing the military
from its political role and for not restoring the party to
its leading role.
Solidarity
13. As a legally recognized, truly independent na-
tional trade union organization, Solidarity is dead. At
most, the authorities appear ready to accept unions
with only limited independence whose activities
would be restricted to the confines of the factory and
to defending workers' narrow economic interests. The
memory of Solidarity will continue, however, to be an
important psychological force in Polish politics, be-
cause Solidarity embodied the society's aspirations for
wide-ranging reform. A mythology will undoubtedly
grow up around the union's activities that will empha-
size its victories over the regime and play down its
own internal disunity.
14. There will be increased efforts to conduct un-
derground activity, in which Solidarity adherents will
play a prominent role. The union was caught totally
by surprise by the declaration of martial law, but the
shock is beginning to wear off and anger is leading to
action. Neither Lech Walesa nor any other senior
union leader seems likely to be co-opted by the
regime. Those Solidarity leaders who have escaped
detention are apparently having some success in rees-
tablishing their shattered organizations and are able to
publish numerous underground leaflets and bulletins.
Such activity will become easier as the regime eases up
15. The response of workers to these resistance
activities will vary. Some will have been cowed by the
regime's successful use of force and prefer not to risk
the loss of their jobs and food rations; the publicizing
of stiff sentences imposed by courts for participation
since 13 December in banned activities has probably
had a significant intimidating effect. But underground
union activists may be able to organize some strike
activity and will try to take advantage of disturbances
that may arise spontaneously. The intelligentsia and
student community will probably continue to be a
hotbed of dissension.
The Church
16. With solidarity suspended, the Polish Roman
Catholic Church once again becomes the primary
defender of the population against the regime. But it
too is on the defensive. Despite its vast moral author-
ity, its political power is limited. The Church is most
concerned about preventing bloodshed and a Soviet
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military intervention; consequently it has avoided
becoming the focal point of active resistance to martial
law. The regime counts on this self-limitation and thus
believes it can ignore many of the demands of the
Church, although it is also apprehensive of Church
influence-especially at lower levels.
17. Overall, the Church has spoken out for a con-
tinuation of the pre-martial-law nation
its Primate, Archbisho emp.
has been
pressed by some bishops who feel that a stronger stand
is necessary in demanding a return to the path of
reforms. Others, however, are concerned that such a
stand would only encourage resistance and could lead
to retaliation against Church facilities and freedom of
action. The regime, for its part, will encourage such
divisions. The parish priests are more radical than the
bishops and may help foster opposition forces. Such
local actions could become the focal point of a larger
confrontation between Church and state. If there is
severe regime repression of society, the Church will
feel compelled to reflect the feelings of the people and
to speak out more forcefully.
18. A key event in Church-state relations this year
and perhaps an important sign of how the regime
intends to structure its relations with the Polish people
will be the projected visit of Pope John Paul II to
Poland in August to commemorate the 600th anniver-
sary of Poland's holiest shrine, that of Our Lady of
Czestochowa. The Pope probably has reservations
about coming to Poland out of fear of bestowing
legitimacy on the martial law regime or of being
blamed for incidents or provocations during his trip.
The regime also undoubtedly has serious doubts about
letting the visit take place. While a papal visit could
marginally enhance the regime's image, it could more
importantly boost public morale and strengthen resist-
ance. The Soviets, who blame the rise of Solidarity
partly on the Pope's 1979 visit, reportedly oppose his
B. Economic Problems
Production
19. The overall effect of martial law has been to
hamstring an already weakened economy. The early
active resistance phase brought industry to a virtual
standstill as workers from several hundred factories
and mines-chiefly the largest and most important-
went on strike. Moreover, the sealing of ports and
borders and the shutdown of communications cut off
industrial inputs and further reduced production else-
where in the economy. The strikes were quickly
broken and many of the transport and communication
_
restrictions have been lifted; however, those still in 25X1
effect are impeding enterprise communications with 25X1
suppliers and foreign markets.
20. Still, the economic situation is deteriorating
further, largely as the result of shortages of Western
materials for industry, but probably also because of
passive resistance. These shortages stem mostly from
cutbacks in imports from the West at the end of 1981
and the halting of commerce during the early phase of
martial law, with the full impact of Western sanctions
still to be felt. As a result of all these impediments,
even certain militarized industries are unable to work
extended hours. Production in the manufacturing in-
dustries may decline by 15 to 20 percent in the first
quarter of the year.
21. In certain sectors not as dependent on Western
imports, however, notably coal and other mineral
industries, production is reportedly up because of the
six-day workweek and martial law restrictions govern-
ing absenteeism, strikes, and trade union activity.
Increased coal production might ease power restric-
tions in industry and permit some growth in exports.
Food Supplies and the Farmer
22. The government has so far been able to keep
market supplies of food at least up to previous low
levels by the apparent release of military and other
food reserves and emergency food shipments from the
USSR and other East European countries. The outlook
for the next 18 months, however, is not good. Meat
supplies are likely to decline about 20 percent this year
because lack of grain is forcing distress slaughter of
chickens and hard currency constraints will limit meat
imports. Potato, flour, and bread supplies depend on
the regime's success in convincing the farmers to sell to
the state. Although famine is not a likely prospect,
some Polish consumers may suffer from protein defi-
ciency because of reduced availability of meat and
eggs, and it is possible that by late spring the regime
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could face a serious crisis in meeting the urban popu-
lation's demand for food.
23. In its approach to private farmers, the regime
has indicated that it will take whatever steps are
necessary to obtain food, especially grain. So far the
regime has insisted that farmer procurement contracts
with the state are legally binding, has tied farmer sales
to the state with access to seed and fertilizer, and has
threatened as a last resort to impose compulsory
procurement. At the same time, the regime has tried
to balance these heavyhanded policies by offering
more credits for agricultural inputs, bonuses for
prompt deliveries, higher procurement prices, and
liberalization of laws on pensions, farm inheritance,
and size of landholdings. This combination of threats
and blandishments has not yielded the necessary pro-
curement. Farmers are loath to part with grain as long
as government feed sales are reduced and there are
few goods for them to buy with their money. The
regime hopes that retail price increases will help make
more goods available for farmers, but this strategy
may not work. Compulsory deliveries and a concomi-
tant major confrontation between the regime and the
farmers remain distinct possibilities.
Economic Relations With the West
24. Martial law has further damaged Poland's eco-
nomic relations with the West and prompted Warsaw
to rely more heavily on economic ties with its CEMA
allies-especially the USSR. The reduction in imports
from the West hurts Poland severely because of its
heavy dependence not only on Western technology
but also on grain and feed concentrates, chemicals,
high-quality semifinished goods, and spare parts. War-
saw's needs from the West this year total close to $7
billion. However, it will probably buy only about $5
billion worth of goods because of its intention to run a
trade surplus in order to pay some debt service.
25. Warsaw still confronts staggering debt service
obligations to the West, and will be unable to make
any significant principal payments for the foreseeable
future on its $27 billion debt. Poland barely managed
to scrape through 1981 without formal default. But
new unpaid obligations toward the West are mounting
at the rate of $800 million monthly, of which $200
million is interest. Poland now faces $10 billion in debt
service obligations this year-and each succeeding
year in the 1980s. Warsaw will probably choose to pay
as much as it can on its interest obligations to private
banks-its most impatient creditors-while forgoing
other payments due on its debt. Its inability to meet
much of the estimated $2.5 billion interest due banks
in 1982 means that the risk of default will continue to
grow.
26. Warsaw's problems are being further exacerbat-
ed by Western sanctions, which will deepen Poland's
financial morass and reduce vital imports. The most
serious casualty is the poultry industry, whose decline
will result in decreased availability of meat and eggs
for Polish consumers. The cutoff of vital Western
credits has forced Poland to trade on a cash-and-carry
basis-thus reducing the amount of even key Western
goods that it can buy-and has blocked the continu-
ation of Warsaw's 1981 financial strategy of importing
on credit and using export earnings to pay interest to
private banks. In recognition of its inability to meet its
huge 1982 obligations, particularly in light of the
suspension of rescheduling talks, the government in
late January unilaterally declared a total moratorium
on all 1982 principal and interest payments "for the
time being." However, in an attempt to keep Western
creditors from declaring them in default and to keep
some economic ties to the West, the Poles will prob-
ably resume some payments when overdue 1981 inter-
est obligations to banks are met.
Economic Strategy and Reform
27. The regime appears to be pursuing an economic
strategy of coercing enough output from a crippled
economy and a beleaguered population to ease Po-
land's financial problems with the West and to lay the
basis for an economic recovery. Its introduction of
higher retail prices is already leading to some correc-
tion of disorder in domestic markets and restoration of
value to the currency. This, it hopes, will lead in turn
to greater production and food procurement because
workers will work Saturdays and overtime and farm-
ers will sell their crops to the state in order to buy the
more expensive goods. The strategy could contribute
to some stabilization of the economy. But the extent of
any near-term stabilization or recovery will depend
heavily on provision by the USSR, and to a lesser
extent by Eastern Europe, of enough assistance to
make up much of the loss of imports from the West.
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Poland's near-term economic prospects will depend
also on a return by the Western governments to a more
generous policy and on continued patience among
Western lenders about collection of their Polish debts.
28. The strategy also requires acceptance by the
population of lower living standards. Massive increases
in food and utility prices on 1 February 1982 were not
fully offset by wage compensation, and about one-fifth
of the population-including private farmers and
craftsmen-received no compensation. Private farm-
ers have been especially hard hit as prices of their
equipment, fertilizer, and other inputs have been
boosted by more than increases in the sales prices of
their products. Moreover, retail prices of manufac-
tured goods will be rising rapidly this year, further
lowering living standards, despite regime pledges to
monitor price increases by enterprises and to consider
further wage compensation.
29. Jaruzelski is committed to push ahead with
some economic reform because he recognizes in prin-
ciple that the old system of centralized planning,
detailed directives from the top, and inflexible prices
not reflecting scarcities did not work and contributed
to the problems leading to the August 1980 events. The
regime has implemented planned wholesale price
reform and devalued the zloty. It will probably enact
other reform measures, although positive effects from
these steps largely depend upon parallel movement
toward a decentralized economy. Nevertheless, Jaru-
zelski's desire to maintain control over the economy
will preclude his accepting much decentralization,
tolerating worker influence on decisionmaking, or
relying on economic forces to guide the economy-all
of which are needed to address the basic problems of
the economy. Thus the regime's emphasis on tight
economic control, and probable worker resistance to
declining living standards, reduce the chances that
significant economic reform will be enacted in the
next 12 to 18 months.
C. External Forces
30. Throughout the Polish crisis, Moscow's basic
concerns have been to preserve Poland as a member of
the Warsaw Pact and to restore the Communist party
as the dominant political force within Poland, while
minimizing the Soviet Union's overt involvement in
repression. More broadly speaking, Moscow has sought
to head off the weakening of Soviet hegemony
throughout Eastern Europe that liberalization in Po-
land would in time have fostered. Having pressed the
Poles for many months to prepare for martial law, and
having coordinated its planning and advocated its
implementation at several points during the crisis,
Moscow clearly welcomed its imposition and the
effectiveness with which Polish security forces carried
out their assignments.
31. The Soviets, nonetheless, appear to realize that
Poland's basic problems remain unsolved and that
martial law in some respects has complicated them
further. Moscow is concerned about divisions within
the party, the ongoing economic crisis, and widespread
worker antipathy to the regime. The complexity of
these problems and the unpredictability of events in
Poland will provide abundant grounds for differences
between Moscow and Warsaw, and probably among
the Soviets themselves, over appropriate actions.
32. The Soviets may recognize that genuine stabili-
zation in Poland will eventually require some flexibil-
ity and accommodation. Nonetheless, the Soviets, like
the Poles, realize they cannot afford to allow any
challenge to Warsaw's coercive policy to succeed.
Moscow is likely to urge the regime to use whatever
repression is necessary for maintaining order, to con-
tinue purging those within the party and other institu-
tions who are identified with far-reaching reformist
ideas, and to work at improving the economic situation
by enforcing austerity measures. The Soviets will
approve conciliatory gestures only if they are initiated
from the top and only to the extent that these appear
absolutely necessary for preventing renewed disorder
or blunting major sanctions by the West. In the final
analysis, they will take whatever action they consider
necessary, including the use of Soviet military force, to
ensure that the Polish regime retains control of the
situation.
33. As long as Jaruzelski appears able to maintain
control and is responsive to Soviet views, Moscow is
unlikely to seek to remove him. It will, however,
continue to cultivate potential challengers as a means
of inducing him to cooperate and of preparing for
possible future contingencies. For ideological reasons,
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the USSR desires to have the Polish Communist party
act as the leading force in Poland. Nevertheless,
because of deep disarray in the party and the inherent
instability of the situation, the Soviets-despite their
misgivings-probably will continue for some time to
accept the military's dominant role in governing
Poland.
34. Soviet policy toward Poland primarily reflects
basic strategic considerations shared by all Soviet
leaders. Consequently, any changes within the Soviet
leadership are likely to affect only the tone and pace
of Moscow's response to events. The recent death of
Politburo member Suslov probably has expanded the
limits of what is ideologically acceptable to Moscow
but is unlikely to have diminished Soviet concern for
the reestablishment of strong central control. Of the
two leading contenders to succeed Brezhnev, Kirilenko
has taken a harder line than Chernenko on most
foreign policy issues and might prefer to react to
events somewhat more quickly and forcefully. Howev-
er, the exact stance to be taken by a contender will be
partly determined by the situation prevailing in Po-
land at the time and by his perception of how it can be
used to further his own political ambitions. Conse-
quently, if an abrupt turn of events in Poland coin-
cided with intense political maneuvering in Moscow,
the interaction of the two could significantly influence
both the Soviet succession and Moscow's policy toward
Poland.
35. Moscow will attempt to maximize its influence
by maintaining close liaison at various levels with
Polish military and civilian authorities, particularly in
the security apparatus (where KGB infiltration appar-
ently increased greatly during 1981); by playing off
rival personalities and factions within ruling institu-
tions; and by using high-level visits, authoritative
media commentary, and exchanges of correspondence
to underscore its views. The Soviets will seek (probably
with little success) to modify Polish public opinion by
maintaining an intense propaganda campaign of their
own while jamming Western radiobroadcasting.
36. Estimates indicate that Soviet economic assist-
ance to Poland in 1981 totaled about $1 billion in hard
currency and about 3.5 billion rubles (the equivalent
of $5 billion) in other forms of aid, much of it in price
subsidies. Although the Soviets so far have not indicat-
ed a willingness to provide substantial hard currency
support to Poland-much of last year's assistance
consisted of rolling over old hard currency debt to the
USSR-the need to prop up the new Polish govern-
ment could well force their hand. Poland desperately
requires funding for purchases of Western foodstuffs
and essential industrial materials such as steel and
chemicals. But because of its own hard currency
problems, the USSR may not wish to provide even
commodity assistance on more than a short-term basis.
37. The Soviet attitude toward aid for Poland has
become more favorable since the imposition of martial
law. Moscow agreed in early January 1982 to allow
Poland to run a 1.2-billion-ruble deficit in their
planned 1982 trade, and will probably increase that
amount. The ruble credits involved-covering one-
fourth of Poland's imports from the USSR-will free
up an equivalent amount of Polish goods for export to
hard currency markets or for use at home. Without
Soviet acceptance of a sharp drop in imports of Polish
coal, for example, Warsaw could not have met even its
greatly reduced target for coal exports to the West.
38. The Soviets will encourage the Poles to seek
Western debt relief and credits in a manner that does
not compromise the restoration of a measure of Com-
munist orthodoxy internally or the further integration
of Poland into CEMA. The Soviets are likely to make
further aid to Poland contingent on the regime's
pursuing policies that the USSR approves, and there-
fore any increases are likely to be doled out piecemeal
in order to maximize Moscow's leverage. Moscow has
already demonstrated-several times last year-its
willingness to use economic pressure tactics and will be
ready to do so again. The Polish leadership will be
especially vulnerable to Soviet pressure because of the
dire state of the economy and reduced levels of
Western assistance. Soviet leverage, however, is limit-
ed by Moscow's recognition that too sharp a break in
Polish-Western trade relations and too much pressure
for faster CEMA integration could precipitate further
destabilization in Poland and the need for still more
substantial Soviet assistance.
Eastern Europe
39. With the successful implementation of martial
law, Poland's East European allies breathed a sigh of
relief, particularly the East Germans and Czechoslo-
vaks. They feared the creation of an alternative
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political model that might prove attractive to their
populations. Prague and East Berlin will keep pressure
on Warsaw to reestablish central control. Budapest
will, using its own experience as an example, probably
point out cautiously that some form of political accom-
modation will eventually be necessary. All of Poland's
allies will remain concerned about possible flareups of
new political unrest in Poland.
40. Despite their satisfaction with martial law, the
East Europeans remain concerned about the costs to
them of Poland's problems, because of the division of
labor and the mutual dependence within CEMA
(especially the heavy reliance of some countries on
Polish coal). There have been reports about the nega-
tive effects of the failure of the Poles to deliver
contracted goods. The East Europeans as a whole
probably have had to pay at least $500 million in
scarce hard currency for replacements. The East
Germans have been forced to accelerate their lignite
mining to reduce their dependence on Polish coal, and
the Czechoslovaks have allegedly talked about curtail-
ing their exports of capital goods because of reduced
Polish deliveries. The East Europeans will probably
not be able or willing to offer the kind of economic
assistance that the Soviet Union is considering. They
will continue to provide some aid, but will resent
Warsaw's requests for even more help.
41. West European leaders see the post-World War
II Polish settlement as a key element in the European
order and view Poland as a territory belonging to the
Soviet sphere of influence. Their interest in nurturing
political change in Poland is clearly subordinate to
their interest in minimizing any danger of East-West
military confrontation. Thus they refuse to make
liberalization in Poland a prerequisite for a construc-
tive East-West relationship. Neverthelesss, the US
NATO Allies do generally want to encourage and
facilitate the survival of parts of the reform program.
They believe the West can wield some influence but
are wary of actions they think will aggravate the
situation. Some leaders, notably West German, believe
that the existing web of East-West ties has inhibited
Soviet military action-the Allies' greatest fear regard-
ing Poland.
42. Several factors are tending to push the Allies
toward a stronger stand on Poland. They are sensitive
to talk of US disenchantment with Western Europe
following a perceived lack of support on issues such as
Afghanistan, Iran, nuclear weapons, and defense
spending. They realize the damage done to the fabric
of the Alliance by public airing of dissension over
Poland. In some countries, the domestic political situa-
tion has had a further hardening effect on government
positions. Clearly a majority of West Europeans disap-
prove of the regime in Poland and of Soviet pressure
on the Poles. Consequently, leaders of the larger
NATO states have found, as the crisis over military
rule has progressed, that the most politically profitable
course-within limits-is to toughen their rhetoric on
Poland.
43. Yet, a number of concerns also prompt the
Allies to adopt a cautious stance. Their caution is
powerfully motivated by a desire to protect the eco-
nomic benefits received from dealings with the East.
Led by the French and the West Germans, the Allies
argue that economic sanctions hurt those applying the
sanctions more than they do the target. They are quite
likely to avoid taking measures that would incur the
loss of revenue, jobs, or more diversified energy
supplies.
44. Allied governments are willing to express strong
verbal disapproval of repression in Poland and to hold
the USSR ultimately responsible. They believe, howev-
er, that major punitive measures-which they see as
increasing the chances of a long-lasting repression or
Soviet military action-should be held in reserve as
threats to deter such developments. Moreover, the
Allies want to hold open the possibility of rewards for
the Poles and Soviets should the situation improve.
Even if the situation deteriorates further, the West
Europeans are unlikely to take meaningful steps unless
heavily pressured to do so by the United States.
45. The West Europeans are also chary of the idea
that arms control-especially nuclear arms control-
should be linked to events in Poland. Most West
European governments believe that efforts to control
nuclear weapons should proceed independently of any
but the most brutal Soviet behavior. They are especial-
ly opposed to an interruption of the talks on interme-
diate-range nuclear forces. Nevertheless, in the event
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of direct Soviet military intervention in Poland, the
Allies probably would accept grudgingly a suspension
of the INF negotiations. They would caution, howev-
er, that NATO not give the impression of seeking to
gain strategic advantage from this step, and if the
situation in Poland stabilized they would urge that
negotiations resume.
46. Unprecedented internal and external conditions
affecting Poland's development probably render past
instances of regime consolidation in Poland (1956,
1970, and 1976), Hungary (1956), or Czechoslovakia
(1968) a poor guide to Poland's future over the next 12
to 18 months. The key internal factors are economic
disaster, military rule in the wake of a collapse of the
Communist party, and a population that has experi-
enced more than a year of increasing freedom from
Communist controls. Externally, Poland teeters on the
brink of default, remains dependent on economic ties
with the West, but is looking more to the East to
satisfy its needs. The USSR, despite its desire to lock
Poland more tightly into the Eastern economic bloc, is
nevertheless constrained in how far it can go by its
own need for trade with the West and its own
economic stringencies. Politically, Moscow must deal
with the linkage between its behavior toward Poland
and achievement of a critical foreign policy aim:
further weakening of the Atlantic Alliance and pre-
vention of INF deployment in Western Europe. This is
one of the primary factors that compel it to put a
premium on repression of resistance in Poland by the
Polish authorities themselves.
47. Poland's future over the next 12 to 18 months
has to some extent already been set by the choice to
impose martial law, but various paths are still open.
The decision to resort to force has ruled out genuine
political accommodation as a trend possible within the
period covered by this Estimate. The range of conceiv-
able outcomes now runs from limited accommodation
through a prolongation of the current national political
stalemate to repression even more extensive than that
currently practiced by the Jaruzelski regime. While
the possibility of a lowering of public expectations and
accompanying moderation by the regime exists, most
of the near-term contingencies that the latter is likely
to confront will probably push it toward continued
repression rather than toward a relaxation of control.
48. A central question is whether economic decline
can be halted at a level that will provide a tolerable
standard of living for the population (albeit that of 10
to 15 years ago), or whether the economy will plum-
met still further. A possibility of stopping Poland's
economic slide does exist: the country has raw materi-
als (notably coal) and a large agricultural production
potential, a currently underemployed labor force, and
unused capital stock. Yet, intractable problems con-
front the regime: a steep drop in vitally needed
Western imports leading to a further decline in indus-
trial output; rising underemployment problems; and
disincentives for independent farmers to market their
produce. These could lead to a further disastrous slide
of the economy.
49. The need to enforce painful and unpopular
choices-especially those of allocating extremely
scarce resources between exports and the domestic
market, and between the cities and the countryside-
will at the very least reinforce political factors favor-
ing continuation of martial law for an extended
period. The regime fears that economic dislocations
inherent in any economic plan it may adopt could
spark public protest; it also knows that it will have to
preside over a period of at least three to five years of
austerity in order to have any hopes for management
of its external debt problem and economic recovery.
Thus, it is likely to rely primarily on coercion rather
than persuasion to induce workers to produce more
and farmers to cooperate with the state. At the same
time, the urgent need of the government to obtain
Western imports, credits, and debt relief and to
encourage labor productivity may lead to a relaxation
of some of the more vexatious features of martial law.
The Containment of Large-Scale Violence
50. Most resistance activities are and probably will
continue to be nonviolent displays of opposition to the
regime such as leaflets, posters, work slowdowns, and
short work stoppages. However, the sources of poten-
tial violence that could erupt spontaneously without
regard to underground activity are ready at hand:
frustration over food shortages, lack of consumer
goods, possible wage losses due to production cutbacks,
and steep price hikes; anger over police repression and
violence; widespread disenchantment among young
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Poles, especially students; dismay over the regime's
corruption and inability to cope with Poland's prob-
lems; and hatred of the Russians. Although the regime
has managed to restore caution among the people, it
has apparently not succeeded in fully instilling fear in
or breaking the morale of its opponents, nor has it
succeeded in adequately stemming illicit communica-
tion that potentially could trigger and quickly spread
violent resistance. We believe, therefore, that the
chances of the occurrence of unorganized violence in
the coming months are very high.
51. Whether isolated flareups of violence merge
into large-scale nationwide conflagration will depend
to a large degree upon the regime's handling of
organized opposition and the strength of the latter. At
least in the short run the pace of resistance efforts may
accelerate and organization may improve. Acts of
armed violence against the regime on the part of some
groups, although strongly deplored by moderate un-
derground elements, can be anticipated; and these will
provide a reason for hardliners in the regime to argue
for more draconian repression.
52. This spring is now a key juncture. There is a
widespread expectation among Poles that with warmer
weather will come more open resistance. This expecta-
tion will undoubtedly prompt some Poles to engage in
violent acts. In anticipation, the regime will have to
continue the use of repressive measures. If the regime
can make it through the spring, there could be a
psychological letdown among the populace that would
increase the government's chances for averting wide-
spread violence for a while. However, the potential for
violent resistance will remain.
53. The substantial and well-trained forces of the
Ministry of Internal Affairs have acted effectively in
implementing martial law, and we believe they-with
the continuing support of the Army-have a good
chance of maintaining order.' If the situation deterio-
rated, the regime would probably employ the Army in
' Ministry of Internal Affairs forces include 100,000 members of
the regular police, 25,000 in the Motorized Regional Citizens Militia
(ZOMO), and 350,000 in the Voluntary Reserves of the Citizens
Militia (ORMO). The ZOMO forces are specialized police trained
and equipped for riot control. They have been in the forefront when
violence was used to enforce martial law. The ORMO auxiliaries are
part-time volunteers, widely regarded by the populace as thugs and
informers. Regular ground forces number 290,000, about 25 percent
of whom are first-term inductees.
a more active role but would choose those units
selected and trained for such a role. In a situation in
which there was a total breakdown of order, which we
consider highly unlikely, the regime would have to
contemplate using military units whose reliability in a
violent confrontation with the population has yet to be
tested. We believe that the Poles have sufficient forces
to handle successfully most contingencies that could
arise. Thus the likelihood of a Soviet military interven-
tion is slight. Moscow remains willing, however, to
move in should the Poles fail.
54. The regime will continue to pursue a two-track
policy aimed, on the one hand, at root-and-branch
suppression of all organized underground resistance
and, on the other, at the institutionalization of sanc-
tioned communication and control links with the
population. It foresees the emergence of some kind of
ill-defined yet significant participatory-consultative
process that would permit political accommodation
with major social groups-workers, farmers, the intel-
ligentsia, and students. If such a program could be
implemented, this would sap the vitality of "extrem-
ist" underground resistance and contribute greatly to
political stabilization.
55. The prospects for achieving effective links with
the population cannot be disentangled from the re-
gime's treatment of the opposition movement. The
regime enjoys no trust and little, if any, legitimacy in
the eyes of the population. To gain that modicum of
trust necessary to establish such links, the regime
would have to terminate fundamental rather than
peripheral features of martial law-which would then
be likely to accelerate underground resistance.
56. The regime's dilemma is capsulized in its quan-
dary of what to do with the approximately 3,600
internees that it still acknowledges. Without a broad
release of these prisoners (including Walesa), there is
not much likelihood that the regime will be able to
strike a genuine deal with any recognized spokesmen
of the workers, arrange much of a dialogue with the
Church, or interest Western governments in dropping
sanctions. But with a broad release of prisoners not
accompanied by a regime commitment to genuine
systemic reform, there would be a clear danger of
giving underground resistance a major shot in the arm.
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We believe that, in dealing with this issue, the regime
will sacrifice accommodation in favor of short-run
security interests, while attempting to convey an im-
pression of moderation. What we are likely to see,
therefore, is a differentiated approach to the prisoner-
release problem, which will seek to defuse the danger
of release through phased liberation of the least dan-
gerous individuals, attempts to fracture unity among
the remaining internees through extortion and provo-
cation, continued detention of those who will not
cooperate, and continued offers of emigration.
57. The regime faces perhaps an even more vexing
dilemma over how to restructure the trade unions in
general and what to do about the suspended Solidarity
in particular. The regime realizes that any progress
toward creating meaningful links with the population,
especially the workers, is closely linked with the
revival of some trade union activity. Yet it remains
divided over the issue. The moderates will continue to
advocate the creation of unions with limited inde-
pendence, organized along occupational rather than
regional lines, that would be allowed to air worker
grievances while still subject to regime control. The
hardliners, on the other hand, will push for the re-
creation of the more traditional, "conveyor belt"
model not much different from that which existed
before August 1980. A victory for the hardliners would
almost certainly further alienate the workers, fuel
underground resistance, and probably force the
Church to take a more confrontational position. The
fact that the interned Walesa continues to retain a
special status suggests that the moderates have not yet
totally lost out on this point. But neither side appears
to be strong enough to force the issue and there is little
likelihood that the problem will be resolved during the
next 12 to 18 months.
Evolution of the Regime
58. The restoration of the traditional power struc-
ture, emphasizing the party's leading role, will not
occur quickly or easily and may become a source of
tension over the next several years. Even when martial
law is ended, the military may see a need for continu-
ing its new role in political and administrative affairs,
especially if the party and government are unable to
develop coherent and effective programs, remain di-
vided, and show little ability to exercise control. At the
top, decisions will probably continue to be made over
the next year or so by an ad hoc group of leaders
tenuously united by their common rise to the top of
the power structure and by their personal ties to
Jaruzelski. The situation is much more complex at
lower levels, where conflicts may well emerge be-
tween military officials performing civilian duties and
their party or governmental counterparts.
59. In policy terms, the regime of the next 12 to 18
months is likely to be subject to much the same
conflicting pressures from hardline and moderate ele-
ments that the party Politburo experienced before the
imposition of martial law. Jaruzelski will probably
remain in overall control, but will supervise a party in
which moderates are on the defensive and hardline
elements appear better organized. As a worsening
environment allows them plausibly to call for even
more repressive measures, the hardliners' influence
will probably increase in the coming months. Moscow
will not provide unqualified support to all their initia-
tives but, will pursue a course that enhances stability
and promotes Soviet influence.
60. Since the imposition of martial law and adop-
tion of Western sanctions, the Polish regime has
played up the alleged subversive ties of Solidarity and
has voiced increasingly strong anti-Western-and es-
pecially anti-American-sentiments, while proclaim-
ing even more forcefully its commitment to Moscow.
This line flows from the regime's internal propaganda
needs, its tactical requirements in suppressing resist-
ance, and its desire to placate the Kremlin. The line
may well become more pronounced over the next
year, but the regime will be constrained to some extent
by hopes of Western economic assistance.
V. IMPLICATIONS
Implications for Poland
61. Despite martial law, Poland remains unstable.
The decisionmaking structure that has emerged is
transitional, and lacks legitimacy. The regime is divid-
ed and factionalized, and has proved incapable to date
of formulating a coherent political-economic strategy.
Use of the Army for repressive purposes has weakened
its public standing. It retains some sympathy in the
eyes of the population, but it has lost its appeal as the
one component of the regime to which most Poles felt
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allegiance. Popular discontent, stimulated by under-
ground resistance, is likely to grow, reinforcing low
productivity and possibly leading to violence. Under
Archbishop Glemp's eadership, the Church
has been thrown on t e e ensive and will be less able
than previously to calm public passions or exert a
moderating influence on the regime.
62. The regime may well be trapped into an ever-
expanding resort to coercion. To end martial law,
release the internees, and engage in good-faith negoti-
ations with Solidarity and the Church would mean to
accept power sharing. The regime imposed martial
law precisely to avoid such an eventuality and it is
even less likely now than last fall to accept it. The
possibility that it will be prepared or able in the near
term to accept these conditions which have been set
for a lifting of Western sanctions is low. However, the
regime will make a concerted effort to present an
appearance that it is taking steps that amount to de
facto compliance with the three conditions.
Implications for the USSR and Eastern Europe
63. The suppression of Solidarity by the Polish
authorities themselves has allowed Moscow to distance
itself from the imposition of repression while counter-
ing the immediate threat to Soviet hegemony in
Eastern Europe. The political and economic costs to
Moscow, however, will still be high. In addition to
providing more economic assistance to Poland, the
Soviets will have to compensate to some extent for the
negative impact of martial law on economic ties
between other CEMA countries and the West.
64. Continuing instability in Poland will exacerbate
economic problems in the other East European coun-
tries. They are being increasingly shut out of Western
credit markets, and this jeopardizes their ability-in
particular, that of Hungary and East Germany-to
continue meeting their financial obligations. Poland's
failure to deliver goods will continue to force the East
Europeans to purchase substitutes on world markets
with scarce hard currency. The trend toward slow
growth or stagnation, in part due to the Polish crisis,
will also have a disquieting effect on their domestic
politics.
65. The Soviets realize that the Polish situation for
some time to come will impede their attempts to
promote political and economic ties with Western
Europe and to divide the Atlantic Alliance. While they
are prepared to accept losses, they will make a strong
effort to play upon West European security concerns,
interest in trade, and disagreement with US sanctions
policy.
66. As a result of events in Poland, US-Soviet
relations have sunk to their lowest point since the
immediate aftermath of Afghanistan. Though US po-
litical and economic sanctions thus far have not had
much impact on them, the Soviets are adopting pro-
tective measures in international financial markets and
seeking alternative sources of grain and agricultural
goods and credits. They will continue to charge that
the United States is using the Polish crisis to heighten
East-West tensions and make West European leaders
and publics more receptive to deployment of new US
nuclear missiles in Western Europe. Senior Soviet
officials appear confident, moreover, that West Euro-
pean concerns will establish clear limits to future US
sanctions and policy options. They count on pressure
from NATO Allies to preclude US suspension of the
INF talks and eventually to induce the United States
to set a date for START.
67. The Soviet leaders' concern about the willing-
ness of Polish Army and internal security units to
maintain control in Poland probably has been allayed
by these forces' effective performance in implement-
ing martial law. The Soviets probably have some
doubts, however, about the ability of the regime to
mobilize Poland if it were called to support military
operations against NATO. These concerns may cause
some adjustment in Soviet operational planning, but,
unless the Polish situation deteriorates radically, the
Polish role in Warsaw Pact war-fighting strategy will
probably not change. The effects of the crisis-espe-
cially the continuing economic constraints-will im-
pede Poland's plans to modernize its armed forces and
bring them up to Pact-wide standards of organization
and equipment.
Implications for the United States
68. Over the near term, the United States will face
a regime in Poland that is internally divided and
unable to deal effectively with the country's problems.
Internal political exigencies and a desperate need for
greater Soviet economic assistance will motivate the
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Polish leadership to lean further toward Moscow and
adhere to its present public anti-American posture,
although this could well be tempered by private
appeals to the United States for a relaxation of
sanctions.
69. The United States does have means to produce a
significant economic impact on Poland. It could, if it
desired, contribute to the alleviation of Poland's food
problems, which might facilitate stabilization of the
regime while at the same time strengthen moderate
elements. It could make a contribution, on a much
lesser scale, in the area of industrial cooperation. Most
importantly, the United States is in a position to exert
a major influence over Poland's prospect for debt
rescheduling, credits, and default. The US Govern-
ment could seek to block IMF membership-on which
Warsaw is counting for about $4 billion over the next
five years. It could also seek-with or without West
European support-to embargo all exports to Poland
and to boycott Polish goods.
70. If Poland were declared in default by major
governments and private creditors, this would have a
limited immediate impact on Poland's economy be-
cause the country already has a depressed trade level,
virtually no access to new Western credits, and few
assets vulnerable to seizure. Default would require
Poland to run a small trade surplus in order to pay for
all imports on a cash-and-carry basis. To do this,
Poland would probably seize on default to evade, for a
while, all debt-servicing payments to the West, and
then use all hard currency export earnings to cover
imports. But default could necessitate some special
and cumbersome arrangements to carry out trade.
More importantly, it would have an important psycho-
logical impact-through the open acknowledgment of
"bankruptcy"-on creditors and would-be creditors of
other East European states and of the Soviet Union.
Additionally, it could, at the very least, delay and
complicate Poland's attempt to join the IMF, thereby
postponing important financial assistance. Overall, it
would have a significant, though unmeasurable, im-
pact on East-West trade relations, to the greater
detriment of the CEMA countries.
71. Sanctions against Poland, including a declara-
tion of default if this occurred, will tend to make
Warsaw more dependent on Moscow and its CEMA
partners. The longer the sanctions last, the more
permanent this shift is likely to be. However, this shift
will not eliminate the underlying long-term need for
Poland and other CEMA countries to develop certain
economic and financial ties with the West. Despite
predictable regime condemnation of sanctions, the
popular attitude in Poland so far has been generally
favorable but could change over time as economic
deprivation grows.
72. The United States also has the capacity, through
radiobroadcasting, to affect the thinking of Poles and
the nonofficial communication in Poland of informa-
tion and ideas. Morale among Poles, and the spirit of
resistance, may depend somewhat on a sense that
Poland has not been forgotten. The continuous jam-
ming of all Voice of America and Radio Free Europe
broadcasts attests to the regime's anxiety about their
possible effects.
73. But the capacity to affect elements of the Polish
problem does not mean that the United States has
great leverage over the Polish regime and its Soviet
overseers, in the sense of having the capacity to force
Polish and Soviet leaders to respond in a desired way
to US cues. US possibilities in this respect are highly
constrained by the stake which both Warsaw and
Moscow have in restoring a reliable system of Commu-
nist rule in Poland that will be adequately responsive
to Soviet interests. Washington can affect the condi-
tions with which the Polish and Soviet leaders must
deal and in this way influence their actions, but is
unlikely to be able to compel them to share power
within Poland.
74. Over the next 12 to 18 months and beyond, the
Polish crisis will have a large potential to affect the
Atlantic Alliance, ranging from a major disruption to
some solidification-depending on what happens in
Poland and the reactions of the United States and our
European partners, respectively. Events in Poland are
likely to heighten Allied disapproval of the Polish and
Soviet regimes, and alter some aspects of the Allies'
relations with the Soviet Bloc-for example, reducing
financial relations and producing sharp exchanges and
perhaps a freeze at CSCE. But US pressure intended to
quickly reverse the Allies' major policy lines toward
the Bloc would be likely to become major public
issues, forcing some West European governments to
resist rather than cooperate with Washington and
perhaps prompting moves counter to US interests.
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75. In the present martial law situation, the West
Europeans have made the same formal demands on
the Polish regime as the United States, but they will
not insist on the same strict compliance as Washington.
The Allies probably would be inclined to try to
improve their relations with Poland if Warsaw took
some further steps to end martial law, released most
internees, and initiated the semblance of a dialogue
with the Church and selected Solidarity representa-
tives-all quite conceivable tactics that the Polish
regime may pursue. In that case, it is unlikely that
punitive measures taken thus far against the Soviet
Union by the West Europeans would be sustained for
long.
76. In sum, within the next 18 months, the West
cannot hope that any of its actions will lead to genuine
political accommodation in Poland. The West can
hope that the combination of Soviet and Polish needs
for Western economic cooperation, continued Western
rejection of business as usual, and continued passive
resistance to the authorities by the Polish population
will have some moderating influence on the regime
and maintain the possibility of long-term compromise
within Polish society.
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