NATIONAL INTELLIGENCE DAILY

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP88T00963R000100180001-9
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 21
• Document Creation Date: December 27, 2016
• Document Release Date: October 31, 2012
• Sequence Number: 1
• Publication Date: July 22, 1987
• Content Type: REPORT

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National Intelligence Daily
Wednesday
22 July 1987
CPAS NID 87-169JX
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22 July 1987
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Top Secret
Contents
Persian Gulf: Iran Urging Cease-Fire on Shipping ...................... 1
Japan-US: Toshiba Affair Enters New Phase .............................. 2
Algeria-Tunisia-Libya: Bendjedid Presses Cooperation ............ 3
Sudan: Civil Unrest Mounting ...................................................... 4
Canada: Socialist Party Sweeps Byelections .............................. 6
EC-USSR: Prospects for Diplomatic Relations ............................ 6
USSR-Afghanistan: Najib Concludes Visit ..................................
Special Analyses
Iraq: Strategy After UN Resolution .............................................. 9
USSR: Gorbachev, Ligachev Increasingly at Odds ...................... 10
Chile: Moderate Opposition Gathers Strength ............................ 12
Brazil: Opposition to Sarney Grows ............................................ 14
Top Secret
22 July 1987
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PERSIAN GULF: Iran Urging Cease-Fire on Shipping
Tehran hopes to balance its opposition to the UN resolution on
the Iran-Iraq war b proposing a cease-fire on shipping attacks
in the Persian Gulf.
Tehran denounced the UN resolution to end the war as a US effort to
support Iraq, but Iran's Ambassador to the UN has not yet accepted
or rejected it. Iran is urging the UN to try to obtain a cease-fire in the
Gulf and says it will attack ships only in retaliation for Iraqi attacks on
Iranian shipping. Iran contends that the intervention of US forces in
the Gulf would violate the UN resolution and render it "null and void."
France announced yesterday that it would provide a military escort for
two of its oil tankers sailing in the Gulf but, henceforth, French ships
plying the Gulf do so at their own risk. Tension between France and
Iran remains high since they broke diplomatic relations last Friday.
Comment: Tehran hopes its proposal for a cease-fire in the Gulf will
cast it as the party willing to pursue peace and Iraq as the source of
tension. The Iranians also would like to separate the war in the Gulf,
where Iran is most vulnerable, from the land war, where Tehran has
the initiative. Iran will be trying to reduce the impact of the resolution
by portraying it as part of the US effort to justify an increased
presence in the region
Paris evidently feels obligated to escort the two tankers that were
scheduled to go to the Gulf before its announcement, but the action
probably does not reflect a permanent change in France's basic
policy of not escorting ships. Paris probably also hopes the move will
demonstrate resolve toward Iran. French naval units near the Gulf are
ill equipped to defend themselves against air attacks, and their ability
to defend merchant shipping is similarly limited. The French frigates
currently in the Gulf would probably also have trouble defending
against small, fast craft attacking at night
Top Secret
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Too Secret
Political sniping from the opposition, divisions in the
bureaucracy, and media questioning on the Toshiba case have
greeted Trade Minister Tamura on his return to Tokyo, where he
is trying to portray as successful his discussi S officials
on the technology diversion case.
Tamura's public remarks since returning to Japan imply he made no
promises in Washington to take specific actions. Despite Tamura's
hints in the US that Tokyo could play a leading role in pursuing
COCOM initiatives that would help stem future diversions, statements
of other officials fall short of such an offer.
"strong suspicion" of linkage.
According to the US Embassy, the opposition parties and media are
demanding proof of a direct link between the Toshiba Machine
Company's illegal export of milling machines to the USSR and
reduction in Soviet submarine noise. Early statements by Japanese
officials, and testimony in the Diet by the Prime Minister, the Foreign
Minister, and others on the subject conflicted, fueling the debate.
Recent remarks reflect a common government stand that there is a
Japanese national security
Tokyo is likely to press the US for more information in order to answer
growing demands from the press and the opposition for proof and to
help build its case that the Toshiba diversion poses a serious threat to
Top Secret
2 22 July 1987
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Top Secret
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ALGERIA-TUNISIA- Bendjedid Presses Cooperation
LIBYA:
Algeria appears determined to bring Libya into its Treaty of
Fraternity and Concord with Tunisia and Mauritania. F
According to the press, Tunisia
reopened ir travel an Other communications links to Libya last
week, and Algiers announced may that the three capitals plan to
build a gas pipeline linking their countries.
Comment: President Bendjedid, who i trying to assert Algerian
leadership of North Africa, is pressing ahead with his greater Maghreb
scheme, despite differences in his government over how to deal with
Libyan leader Qadhafi. He appears to be trying to take a middle
course between those pushing for full political unity with Libya and
those wary of Qadhafi.
Qadhafi almost certainly wants to join the treaty, although he is
reluctant to recognize the "colonial" border with Algeria while he is
denying the legitimacy of the "colonial" frontier with Chad. As a
gesture, he would be willing to meet Tunisia's financial demands and
promise to refrain from meddling in Tunisian and Algerian affairs in
return for similar pledges from Bendjedid and Bourguiba.
Top Secret
3 22 July 1987
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SUDAN: Civil Unrest Mounting
A rash of disturbances in Khartoum is stretching police
capabilities, and the military is likely to stage a show of force
against the demonstrators.
s u en s are protest! ngs ortages
of books and equipment, while others are demonstrating because
of shortages of fuel, public transportation, power, and water.
Intermittent strikes by postal and telecommunications workers and
electricians have cut off some essential services.'gje Emb___y
hbeiievo the demonstrations will continue to increase in number and
size.
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the Army will soon begin orce, moving troops and 25X1
armore vehicles in Khart addition, police have orders to
arrest suspected agitt ors, more checkpoints are being set up on the
outskt S'e city, and searches are being organized in areas where
y officers are unhappy with
the currerunr most want the civilian government to resolve
Comment: Periodic waves of strikes and demonstrations have
occurred in Khartoum over the past year, but the current round
indicates that civilian impatience with Prime Minister Sadiq's
ineffective administration is increasing. If the situation continues to
deteriorate, the Army will impose stronger measures to deal with
demonstrators and senior officers are likely to consider forcing the
civilian government to step aside.
Tnn Rair-rat
4 22 July 1987
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Too Secret
CANADA: Socialist Party Sweeps Byelections
The socialist New Democratic Party won another three seats in
Parliament on Monday, two in longtime Conservative strongholds.
The results lend credence to nationwide polls in recent months that
have shown the party leading the Tories and Liberals. Gallup gives the
New Democrats 41 percent of the support this month of the decided
voters, the Liberals 35 percent, and the Tories 23 percent, a near-
record low. Press analysis suggests that the results of the byelection
will increase Tory infighting as Prime Minister Mulroney comes to be
seen as the party's biggest liability and will intensify debate among
the Liberals over John Turner's leadership
Comment: The NDP victories underscore the public's distaste for the
scandal-plagued Tory government and for Mulroney in particular.
Tory popularity has fallen steadily despite a strong economic recovery
and the conclusion of a new constitutional accord. Some Tory leaders
probably believe the party has no choice but to persevere, hoping the
Socialists' surge will ebb and Liberal infighting will increase by the
next election in 1989. Others, however, may conclude that the Tories
should risk an early election to capitalize on Liberal disarray and the
specter of a socialist victory, despite the Conservatives' current poor
standings in the polls-particularly in view of the large number of
undecided voters
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EC-USSR: Prospects for Diplomatic Relations
Member states disagree on how quickly the EC should expand ties to
Moscow Most are said to believe
that recent domestic economic and political changes in the USSR are
significant; some EC members interpret the recent Soviet Central
Committee plenum as clear evidence that the balance of power has
shifted in favor of General Secretary Gorbachev and his reform
program. France remains skeptical, however, arguing that Soviet
foreign policy objectives remain unchanged and that progress on
human rights has been slow. EC disagreement with Moscow over the
status of West Berlin, moreover, is still a barrier to establishing full
relations, according to various US Embassy reports.
Comment: Resistance among powerful EC members is probably
sufficient to slow but not halt progress toward expanded foreign
policy consultations and eventual diplomatic relations with Moscow.
The issue will almost certainly be considered by EC foreign ministers
at their meeting in September.
Top Secret
6 22 July 1987
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USSR-AFGHANISTAN: Najib Concludes Visit
TASS reports that General Secretary Gorbachev discussed
"additional steps and measures in the interests of a speedier
normalization" with visiting Afghan party chief Najib, who returned to
Kabul tereley. Najib told a Moscow press conference that these
would include political steps already announced as well as economic
and military measures. TASS emphasized continued Soviet support
for Kabul's "national reconciliation" policy and said Naiib had been
invited to attend the October Revolution celebrations.
Comment: Najib's visit to Moscow last December was the prelude to
his cease-fire and "national reconciliation" initiatives. The Soviets
may have used the latest visit to push a new proposal-such as a
rumored roundtable conference involving all parties to the Afghan
conflict-although Najib's statement to the press suggests that
measures other than political may be in the offing. The official
statements do not indicate optimism about the near-term prospects
of the current policy. Although references to Najib are not warm, the
invitation to return in the fall shows that Moscow is underlining its
commitment to him and his regime
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officials ... Bamako may seek more Western ai
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Malian President Tra
advisers with suspected KGB links, easing out p
ore reducing
ismissed Soviet
ro-Soviet party
Soviet influence, wants closer ties to West ... d
RENAMO. .
reduce dependence on USSR, improve prospects against
Mozambique recently asked
Portugal to train 100 military officers annually ... part of effort to
program
likely as banks still demanding token interest pa
v
-
Brazil's President told US Ambassador IMF acc
impossible ... wants US banks to settle without
- Salvadoran rebelslattadked Honduran border p
this mont . Honduran ar
with Salva Oran military.. . using forces to bloc
returning to refugee camps used as sanctuaries.
- Guatemala considering trade ties to Cuba,
. allowing Cuban press to open office
relations unlikely
strong Guatemalan military opposition makes fu
ord politically
it ... stalemate
ment. IMF
my cooperating
in capital ...
II diplomatic
Top Secret
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Too Secret
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Special Analysis
IRAQ: Strategy After UN Resolution
Baghdad has given preliminary Indication that it will accept the
UN Security Council resolution on the Iran-Iraq war and will try to
ensure that the onus for any further fighting falls on Iran. The
Iraqis probably will halt air attacks in the Persian Gulf at least
temporarily. Iraq will try to keep the superpowers involved in the
Gulf so that they will continue to press Iran to end the war.
Baghdad will try to contrast its eagerness to end the war with
Tehran's intransigence.
Baghdad has announced that its General Assembly will debate the
resolution in a few days, but the outcome undoubtedly will be
favorable. The US Embassy in Amman reports that Iraqi Foreign
Minister Aziz said Iraq would honor a cease-fire unless attacked. If,
however, Iran has not accepted the resolution and withdrawn to the
international border within a few weeks, Iraq probably will resume its
shipping attacks because of its longstanding belief that a cease-fire
limited to the Gulf favors Iran.
Meanwhile, Iraq probably will begin diplomatic efforts to get Security
Council members, particularly the superpowers, to adopt a follow-on
resolution calling for stiff mandatory sanctions against Iran for
violating the cease-fire resolution. China, the USSR, the UK, France,
Ghana, and Congo. however are like) to drag their heels on such a
measure________________________
While moving closer to the US, Iraq is eager for continued Soviet
support as well and will maintain close ties to Moscow. Iraq is
concerned that the Soviets will cut a deal with Iran at Baghdad's
expense. In a recent address to ruling Ba'th Party officials, Iraqi
President Saddam Husayn lauded General Secretary Gorbachev for
economic reforms similar to those Saddam is pushing in Iraq. The
Iraqis early this month signed a five-year technical, trade, and
economic agreement negotiated with Moscow last year. The USSR,
Iraq's principal arms supplier, continues to assist in the development
of Iraq's energy and agricultural sectors.
Tee Secret
9 22 July 1987
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Gorbachev Speaks Out on Glasnost
Under the press of debate about the legitimate boundaries of glasnost, Gorbachev has made
the clearest statement to date of official guidelines:
On the value of openness ...
- "The most controversial questions need to be debated while having respect for one
another. In even the most extreme points of view there is something valuable...."
- "I think that we never will be able to forgive or justify what happened in (Stalin's
purges of) 1937-38, and we never should...."
- "I do not see any drama in polemics, in the confrontation of points of view. It is
normal."
- "This is not permissiveness, glasnost is called on to strengthen socialism."
- "If they start seeking out ... values and discoveries outside the limits of the interests
of the people and beyond the limits of socialism, then the Central Committee will
publicly subject this to criticism."
Specifically, Gorbachev cited as beyond the bounds of permissible debate:
- "Things that go beyond the bounds of our system, in particular that we should
renounce the instrument of the planned economy."
- "The idea that it is possible to get by without the party ... there must be no
disrespectful attitude toward cadres in general."
- "A rejection of everything that has gone before ... would be a mistake.... We are
proud of everything that enriches our long and great history."
- "We would be concerned if (our artistic intelligentsia) tried in conditions of openness,
publicity, and democratism to gain revenge for every criticism."
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Special Analysis
USSR: Gorbachev, Ligachev Increasingly at Odds
Since the Central Committee plenum last month, policy disputes
between General Secretary Gorbachev and senior party
secretary Ligachev appear to be heating up. In a sharply worded
speech, Ligachev has protested abuses of glasnost and excesses
of the media. Gorbachev has refuted Ligachev's suggestions that
the situation is getting out of control, but he has acknowledged
that openness must have limits-and he may have approved
curbing groups that are going too far. If their political fortunes
continue to wane, Ligachev and opponents of reform may
become more aggressive in attempting to use the glasnost issue
against the General Secretary.
Even before the plenum, Ligachev had been distancing himself from
some controversial political and economic reforms proposed by
Gorbachev, while continuing to support him on many other issues.
Although the promotion of three additional senior secretaries at the
plenum significantly weakened Ligachev's influence within the
secretariat, he has not been silenced. In a speech early this month at
the newspaper Sovetskaya Kultura, he voiced the strongest public
reservations to date on the part of a senior Soviet official about
glasnost. He charged that the media, while moving in the right
direction, had dredged up "scum and debris" and brought forth some
"dubious ideas." Ligachev called instead for "constructive"
glasnost, blending artistic merit and "profound ideological
commitment."
This speech and other recent appearances suggest that Ligachev is
determined to retain a voice in the regime's ideological and cultural
policies. Gorbachev ally Aleksandr Yakovlev has become increasingly
prominent in those areas, however, and his recent promotion to full
Politburo membership gives added weight to his pronouncements.
Yakovlev has been substantially more tolerant of wide-ranging debate
than Ligachev and last week appeared to take issue with him by
criticizing unnamed persons who call for limits on openness. Even
Soviet insiders seem confused about the respective roles the two me
hathat t~-
are playing: 6GO-MG-FAIM 401d US SM15880y
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Yakovlev is now in charge of ideology, but
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party official said that Liaachev and Yakovlev are sharing ideological
responsibilities.
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Ligachev's concerns that the reforms may be going too far are no
doubt shared by many party officials who are not only hesitant about
reforms themselves but also fear that encouragement of media
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concerns, Gorbachev has appointed Yakovlev to head a new
commission charged with maintaining the momentum of the reform
process while ensur' es not get out of hand, ascordingto .
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Media criticism of recent manifestations of unbridled Russian
nationalism indicates that concerns about glasnost giving rise to
extremism are shared by reformers as well as more orthodox party
members. 1-1-6 Embassy F9p4D;UPAj-su@qests t Moscow party boss
Boris Yel'tsin)was criticized by unnamed senior officials for meeting 25X1
with demonstrators from an extreme Russian nationalist group,
Pamyat', in May. W-COr-dii W .- an Embassy um
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In a 14 July speech to media officials, Gorbachev appeared to
respond to the concerns raised by Ligachev. He promised that
glasnost and criticism would not be allowed to undermine "socialist"
values or create a climate of disrespect for party officials. His remarks
suggested, however, that he did not share the same degree of
concern as Ligachev about excesses in glasnost. Gorbachev denied
that grounds exist for "great political reproaches" and asserted that
there is something valuable even in the extreme viewpoints that have
The General Secretary may see himself as vulnerable on the issue of
openness. He told the media chiefs that some people are just waiting
for "you or me to make a mistake ... to turn it against the entire
process of democratization and glasnost."
The unusual public airing of differences between Gorbachev and
Ligachev suggests they may be moving toward a showdown over
reform. Tension between the two may contribute to rumors circulating
in Moscow that Gorbachev wants to dilute further Ligachev's power
by moving him to the largely ceremonial presidency now held by the
78-year-old Gromyko
Top Secret
11 22 July 1987
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The Chilean Political Spectrum
The Moderate Opposition Parties
All political parties have been technically illegal in Chile since the military government came to
power in 1973, but several dozen moderate parties and factions continued to operate more or
less openly. The moderate parties have formed several coalitions in the past few years.
- The Democratic Alliance. A broad grouping of seven parties from the moderate right
to the center left founded in 1983 and dominated by the centrist Christian Democratic
Party. Chairmanship rotates every six months among the parties.
- The National Accord. Eleven mainstream parties that signed a comprehensive series
of moderate proposals for a transition to democratic government in August 1985 at
the instigation of the Catholic Church's primate. Includes two conservative and two
leftist parties along with the original members of the Alliance. Quiescent in recent
months.
- The National Civic Assembly. A loose grouping-led by the Christian Democrats-of
18 leading professional, labor, academic, and social groups formed in April 1986.
Largely inactive in recent months.
- The Party of National Renovation. Established in January 1987, through the fusion of
two moderate right and one far right parties. Key members were formerly closely
identified with the Pinochet government and at one time apparently favored the
President's reelection in 1989. Several now endorse the free election campaign
headed by Sergio Molina.
In March 1987, the government passed legislation-one of the laws that under the
constitution of 1980 must be in place before the presidential plebiscite is held-to legalize
non-Marxist political parties. As of late last month, eight parties, mostly from the right of
center, had begun the initial steps to acquire legal status.
Far Left Groups
The Communist Party of Chile is the largest and best organized far left group in the country;
its total card-carrying membership has grown to 37,000, and its youth wing probably numbers
about 20,000. In December 1983, the party supported the creation of the Manuel Rodriguez
Patriotic Front, which has become Chile's main terrorist group, with a membership of 1,500 to
2,000. It has carried out more than 2,500 bombings since late 1983 and mounted the
assassination attempt against Pinochet in September 1986.
Several other far left groups advocate violence to overthrow Pinochet, but none approaches
the Front in size or frequency of terrorist actions, including the pro-Cuban Movement of the
Revolutionary Left. Most far left parties belong to the Communist-led Popular Democratic
Movement coalition, which was folded into the new United Left alliance in mid-June. The
Communists used the Movement-and will try with the alliance-to channel many of their
overt political activities, such as calls for street protests and for liaison with student, labor,
church, and professional groups.
Top Secret
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Top Secret
Special Analysis
CHILE: Moderate Opposition Gathers Strength
Chile's moderate opposition, benefiting from growing popular
exasperation with both President Pinochet and leftist violence, is
showing considerable cohesion and a new pragmatism. A voter
registration drive is beginning to catch on with the public, and
the moderates have made overtures to the armed forces that
could result in a consensus civilian or military successor to
Pinochet. The far left remains politically isolated; it will probably
not be able to disrupt violently the moderates' efforts to reach an
accommodation with the military.
Recent polls show overwhelming popular backing for a return to
democracy and a direct election to select the next president in 1989.
There is almost no support for the plebiscite backed by Pinochet.
Nevertheless, most Chileans expect Pinochet to retain power, even
though they would prefer one of several opposition leaders.
Moderate opposition leaders gained little with confrontational tactics
over the past year and now recognize that most Chileans repudiate
violence. They acknowledge they must avoid street protests, promote
the free election and voter registration drives, and convince the
military they are a viable alternative to Pinochet.
The US Embassy notes the Christian Democrats typify this greater
realism. They are the main opposition and later this month probably
will replace longtime Chairman Gabriel Valdes-hated by the
military-with Patricio Aylwin, a respected conservative determined
to gain the trust of the armed forces
Pinochet is disturbed by this prospect because he believes
ywill improve the party's image and make it a greater threat to
his government
Aylwin's main goal is to persuade the armed forces to prevent
Pinochet from running for reelection. He and several other moderates
have signaled the Military Junta-which must approve the plebiscite
candidate-that they would back a consensus conservative
candidate, civilian or military, who pledged to carry out a genuine
political transition after 1989. They believe the military will not risk
selecting Pinochet. as the candidate if the moderates can register
about three-fourths of the 8.3 million eligible voters by mid-1988.
The registration drive is headed by a nonpartisan council, which is
raising funds and establishing a national organization. Its coordinator,
Sergio Molina, is a moderate Christian Democrat who is widely
continued
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Top Secret
and generate a massive vote against him
leaders say, according to the US Embassy, that if Pinochet is
nominated the opposition can still mobilize to denounce vote fraud
respected, even by senior military officers. He and other opposition
A prominent Chilean business leader has told US officials that the
business community fears that Pinochet's free market economic
policies will become discredited if he stays in power much longer. As
a result, the business community is distancing itself from the
President and now prefers a civilian as transitional chief of state.
Businessmen plan to launch a program next month to build support
for the private sector inference, for a consensus presidential
candidate in 1989.
in voter registration is partly due to strong church support.
head of the government's election service announced the recent
Leaders of the two main labor confederations are touring the
provinces to support the voter registration drive. Last month the
church's Episcopal Conference called on Chileans to register, and the
the Communists-the main subversive
fruitless.
force in the country-remain on the defensive following the
government seizure of major arms caches last summer and their
failed attempt to kill Pinochet last September. Communist leaders
now emphasize political tactics and play down their past advocacy of
violence as the only way to remove Pinochet. So far, however, their
efforts to rebuild their ties to the moderate opposition have been
distance themselves from the Communists
Terrorism by the Communist-affiliated Manuel Rodriguez Patriotic
Front declined markedly over the past year, but bombings and
assaults on the security services surged following the killing last
month of 12 terrorists in alleged shootouts. Communist-sponsored
violence probably will increase in the coming months, particularly
since moderate opposition leaders almost certainly will continue to
with the far left and condemn violence.
also find it hard to capitalize on any resurgence of Communist
terrorism as long as the moderates continue to reject cooperation
Pinochet remains determined to ram through his nomination as the
sole plebiscite candidate. He can no longer convincingly argue that he
is the only alternative to chaos, however, because the moderates have
indicated a willingness to accept a slow transition to civilian rule that
would safeguard key military and conservative interests. Pinochet will
nn Rarra
13 22 uy
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 Declassified in Part - Sanitized Copy Approved for Release 2012/12/17: CIA-RDP88T00963R000100180001-9
Top Secret
Special Analysis
BRAZIL: Opposition to Sarney Grows
The Sarney administration's program to halt runaway inflation-the
Bresser Plan-is becoming a lightning rod for growing public criticism
of the President. Organized labor is uniting behind plans for a general
strike next month, and leftists are demonstrating in favor of an early
presidential election. Conservative forces who have withheld criticism
of Sarney may return to the attack if he abandons the Bresser Plan.
The protests are creating the political conditions necessary for
leaders in the Constituent Assembly to ease Sarney from office.
A recent opinion poll indicates dissatisfaction with Sarney and his
policies is widespread. A majority of voters doubt the Bresser Plan
will bring an end to inflation, unemployment, or the wage freeze.
Public discontent runs so deep that only 3 percent of those polled
would vote for Sarney in a field of seven candidates if a direct election
were held now, according to press reports.
s
violent, street demonstrations, which are being ex y the left.
militant unio a joined with leftist
parties in large antigovernment nstrations in Rio de Janeiro,
Sao Paulo, and Brasili ing layoffs and the wage freeze are
creatin str port from the rank and file for a general strike next
Sarney's most vocal opponents on the left-Marxist Lula da Silva of
the Workers Party and his charismatic populist rival, Leone[ Brizola-
have agreed to join forces to press for an early election, a[sserdinyLo-
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14 22 July 1987
Declassified in Part - Sanitized Copy Approved for Release 2012/12/17: CIA-RDP88T00963R000100180001-9
 Declassified in Part - Sanitized Copy Approved for Release 2012/12/17: CIA-RDP88T00963R000100180001-9
Top Secret
Stirrings on the Right
from directly criticizing Sarney.
Conservative political and business groups have muted their criticism
since Sarney introduced the Bresser Plan but are wary that Sarney
will reinstate the populist social and economic policies he turned away
from last year. Landowners demonstrated in Brasilia last week to
protest legislative efforts to expand agrarian reform, but refrained
further.
Recent statements by retired and active-duty military officers who
disapprove of Sarney indicate that hardliners in the military, although
a minority, are restless. Their dissatisfaction with the President's
weak leadership might spur the high command to move more
forcefully to prop up Sarney's government if the situation deteriorates
Prospects for This Year
Protests will probably intensify as the, conomy declines. ~+~e-tfS-
there is a sense of crisis among
Plan.
the poor and that they have taken to random looting of supermarkets.
Leaders of the Democratic Movement are pressing Sarney to increase
federal spending to head off a recession, and he probably will be
forced to discard economic austerity, unleashing inflation again.
Political commentators say the conservatives may renew their attacks
if Sarney surrenders to growing leftist pressure to scrap the Bresser
Under these conditions, the Constituent Assembly probably would
curtail Sarney's term and call a direct election in 1988 or 1989. The
Assembly might strip Sarney of many of his powers by establishing a
new parliamentary system before the election. Such a move, however,
would raise concerns in the military over the prospect of a Brizola
presidency, and the high command would try to exert influence
behind the scenes to support Sarney through the transition period.
There is also the risk that the collapse of fiscal discipline could lead to
spiraling economic protests, with violence becoming more common.
Popular and political pressures for an immediate presidential election
could cause military leaders to move in concert with civilian leaders in
the Constituent Assembly in an effort to ease Sarney from office.
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Declassified in Part - Sanitized Copy Approved for Release 2012/12/17: CIA-RDP88T00963R000100180001-9
Declassified in Part - Sanitized Copy Approved for Release 2012/12/17: CIA-RDP88T00963R000100180001-9