WHAT IS GOING ON IN THE SOVIET UNION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89G00720R000700930003-9
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 21
• Document Creation Date: December 23, 2016
• Document Release Date: August 8, 2012
• Sequence Number: 3
• Publication Date: January 5, 1988
• Content Type: MISC

Declassified and Approved For Release 2012/08/10: CIA-RDP89GO072OR000700930003-9
5 JANUARY 1988
WHAT IS GOING ON IN THE SOVIET UNION
INTRODUCTION
kHE SELECTION OF MIKHAIL GORBACHEV AS GENERAL
S(4 JALE
SECRETARY IN THE SPRING OF 1985A THE OLITBUROS S~eiV'AtEH--I-9
RECOGNITION THAT THE SOVIET UNION WAS IN DEEP TROUBLE --
ESPECIALLY ECONOMICALLY AND SPIRITUALLY -- TROUBLE THAT THEY
RECOGNIZED WOULD SOON BEGIN TO HAVE REAL EFFECT ON MILITARY
POWER AND THEIR POSITION IN THE WORLD. DESPITE ENORMOUS RAW
ECONOMIC POWER AND RESOURCES, INCLUDING A $2 TRILLION A YEAR
GNP, THE SOVIET LEADERSHIP BY THE MID-1980S CONFRONTED A
STEADILY WIDENING GAP WITH THE WEST AND JAPAN -- ECONOMICALLY,
TECHNOLOGICALLY AND IN VIRTUALLY ALL AREAS OF THE QUALITY OF
LIFE.
AS A RESULT OF THESE TRENDS, THE POLITBURO RECOGNIZED THAT
THE SOVIET UNION COULD NO LONGER RISK THE SUSPENDED ANIMATION
OF THE BREZHNEV YEARS, AND COALESCED AROUND AN IMAGINATIVE AND
VIGOROUS LEADER WHOM THEY HOPED COULD REVITALIZE THE COUNTRY
WITHOUT ALTERING THE BASIC STRUCTURE OF THE SOVIET STATE OR
COMMUNIST PARTY.
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IN GORBACHEV THEY HAVE GOTTEN MORE THAN THEY BARGAINED
FOR. THE EXTRAORDINARY SCOPE OF HIS INITIATIVES, HIS ENERGY,
AND HIS WILLINGNESS TO BREAK WITH PAST PRACTICES, HAS PROMPTED
DEBATE NOT ONLY AT HOME BUT IN THE WEST AS TO GORBACHEV'S
ULTIMATE OBJECTIVES. WITH ALL THE SPECULATION, IT IS WORTH
TAKING A LOOK AT WHAT IS GOING ON -- WHAT HE ACTUALLY HAS DONE
AND WHERE HE INTENDS TO GO.
STRENGTHENING THE LEADERSHIP AND HIS POSITION
THERE IS STRONG SUPPORT IN THE POLITBURO (E R-GORBA4&"V
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THE Sot//ET
ECONOMY. WHILE POLITBURO POLITICS ARE ALWAYS OVER SIMPLIFIED
AND OFTEN MISUNDERSTOOD IN THE WEST, FOR CLARITY AND BREVITY
ONE MAY PRESUME THREE APPROACHES TO MODERNIZATION IN THE
POLITBURO. THE FIRST, LED BY GORBACHEV, SEES A NEED TO
UNDERTAKE A FAR-REACHING RESTRUCTURING OF STALINIST ECONOMIC
POLICY AND ITS SLUGGISH CENTRALIZED BUREAUCRACY, AND, FURTHER,
THAT REAL MODERNIZATION AND TECHNOLOGICAL ADVANCE REQUIRES A
LOOSENING OF POLITICAL CONTROLS -- INCLUDING CONTROLS ON
INFORMATION.
ANOTHER APPROACH, PROBABLY BEST REPRESENTED BY LIGACHEV, IS
THAT MODERNIZATION CAN BE ACHIEVED BY REDUCING CORRUPTION, BY
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IMPROVING MANAGEMENT (AND MANAGERS), BY MEASURES MAINLY
DESIGNED TO MAKE THE EXISTING~SYSTEM FUNCTION MORE EFFICIENTLY
AND BY SOME CHANGES IN THE SYSTEM AT THE MARGIN. THOSE WHO
HOLD THIS GENERAL VIEW SEE ALMOST ANY POLITICAL LOOSENING UP AS
UNNECESSARY AND DANGEROUS. THE THIRD, MIDDLE APPROACH, PERHAPS
LED BY PREMIER RYZHKOV, IS MORE ATTUNED TO GORBACHEV'S VIEW OF
THE NEED FOR FAR-REACHING ECONOMIC REFORM -- THOUGH MORE
SELECTIVE, BUT IS CONCERNED ABOUT THE DANGERS OF LOOSENING
POLITICAL CONTROLS.
NONE OF THE THREE APPROACHES HAS A MAJORITY OF SUPPORT IN
Mosr
THE POLITBURO ANDAINDIVIDUAL MEMBERS PROBABLY FIND THEMSELVES
TAKING DIFFERENT POSITIONS FROM ISSUE TO ISSUE. ,
NEARLY EVERY STEP GORBACHEV SEEKS TO TAKE TOWARD STRUCTURAL
ECONOMIC OR POLITICAL CHANGE IS A STRUGGLE, AND SUPPORT IN THE
POLITBURO FOR HIS INITIATIVES SHIFTS CONSTANTLY. FOR EXAMPLE,
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HIS PROPOSALS FOR ECONOMIC CHA PAR Y CONFERENCE WERE
REJECTED IN JANUARY 1987, BUT ADOPTED IN JUNE. AND, DESPITE
SIGNIFICANT SUCCESS IN JUNE, HIS PROGRAM HAD AGAIN RUN INTO
TROUBLE BY FALL. BY YEAR'S END, HE WAS DISTANCING HIMSELF FROM
THE RADICAL APPROACH TO REFORM HE HAD EMBRACED EARLIER IN FAVOR
OF MORE POLITICAL TENABLE MIDDLE GROUND. SO, HE FACES A DAY TO
DAY STRUGGLE EVEN IN A POLITBURO WHERE A MAJORITY OF MEMBERS
ARE NEW SINCE BREZHNEV'S DEATH. AND, AS WE SAW IN NOVEMBER
WITH THE EXPULSION OF MOSCOW PARTY BOSS YELTSIN, EVEN HIS
ALLIES CAN BE A HINDRANCE IN THE DELICATE POLITICAL BALANCING
AND BARGAINING HE MUST PURSUE TO ACHIEVE PROGRESS.
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BELOW -THE- POL- I TBURO, :.SUPP'ORT -FOR 'CHANGE . -= AND ESPECIALLY
FAR-REACHING CHANGE -- IS EVEN SHAKIER. OPPOSITION FROM THE
PARTY CENTRAL COMMITTEE AND PARTY APPARATUS IS A CRITICAL
PROBLEM FOR GORBACHEV. SENIOR LEVELS OF THE ECONOMIC
BUREAUCRACY STAND TO LOSE THE MOST IF GORBACHEV MOVES TO
DECENTRALIZE THE SYSTEM AND ARE IMPORTANT OBSTACLES TO
IMPLEMENTATION OF HIS PROGRAM. WHILE MANY SENIOR OFFICIALS OF
THE NATIONAL SECURITY BUREAUCRACIES UNDERSTAND THE CONNECTION
BETWEEN A STRONG DEFENSE AND A HEALTHY ECONOMY, THEY ALSO ARE
UNHAPPY WITH THE IDEA OF GREATER CONSTRAINTS ON DEFENSE
SPENDING AND SKEPTICAL OF PROMISED BENEFITS. OTHERS, FOR
EXAMPLE THE KGB, ARE CONCERNED ABOUT THE POTENTIAL FOR
INSTABILITY AT HOME AND IN EASTERN EUROPE CREATED BY ANY
RELAXATION OF POLITICAL CONTROLS. THE SOVIET POPULATION SEEMS
TO BE PASSIVELY SUPPORTIVE, BUT THEY HAVE SEEN CAMPAIGNS FOR
CHANGE COME AND GO. THEY ARE SKEPTICAL THAT GORBACHEV'S
EFFORTS WILL PRODUCE LASTING RESULTS OR EVEN IMMEDIATE
PAYOFFS. THE INTELLIGENTSIA ARE PROBABLY THE ONLY GROUP THAT
COMES CLOSE TO GIVING WHOLE-HEARTED SUPPORT.
IN SUM, GORBACHEV STILL VIGOROUSLY SUPPORTS RESTRUCTURING,
HAS MADE HEADWAY IN OBTAINING POLITBURO SUPPORT, BUT FACES A
LARGELY HOSTILE PARTY AND STATE BUREAUCRACY AND A CONSERVATIVE
AND APATHETIC POPULATION.
H* .4.3EVERY RUSSIAN AND SOVIET LEAD KING CHANGE OR
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1 *S F}cE~ 1-Okt'bA$t, .OPhSITtDA .
MODERNIZATION BUT, UNLIKE THEM, GORBACHEV REALISTICALLY CANNOT
RESORT TO.WIDE=SCALE. TERROR::AND.V:IOLENCE TO ELIMINATE THOSE WHO
STAND IN HIS WAY. HE MUST RELY ON A LONG TERM, LARGELY
NON-VIOLENT PURGE OF PARTY AND BUREAUCRACY AND PLACEMENT OF HIS
SUPPORTERS IF HE IS TO REMAIN IN POWER AND TO SUCCEED AT ALL.
THE CENTRAL QUESTION IS WHETHER HE WILL GET ENOUGH TIME.
REJUVENATION OF THE ELITE
A
PURGE IS UNDERWAY. EIGHT MEMBERS OF THE POLITBURO ARE
NEW SINCE GORBACHEV BECAME GENERAL SECRETARY. FORTY PERCENT OF
THE CENTRAL COMMITTEE IS NEW SINCE HE ASSUMED THE REINS.
THERE HAVE BEEN OTHER LARGE SCALE PERSONNEL REPLACEMENTS.
-- OF THE ELEVEN OTHER PARTY SECRETARIES, NINE ARE NEW
GORBACHEV APPOINTEES.
-- 59 OF 105 MEMBERS OF THE USSR COUNCIL OF MINISTERS ARE
NEW SINCE GORBACHEV ASSUMED POWER.
-- HE HAS APPOINTED TWELVE NEW DEPUTY CHAIRMEN OF THE
COUNCIL OF MINISTERS OUT OF FOURTEEN.
-- 47% OF THE OFFICIALS IN THE AGRO-INDUSTRIAL COMPLEX
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15 OF-20-CENTRAL COMMITTEE:DEPARTMENT CH`IEFS:HA:VElBEEN
-- 88 OF 157 REGIONAL FIRST SECRETARIES HAVE BEEN REPLACED.
BEYOND A SENSE OF PERSONAL JEOPARDY, MANY WHO OPPOSE
GORBACHEV'S POLICIES BELIEVE THOSE POLICIES TO BE INHERENTLY
MISTAKEN AND BAD FOR THE COUNTRY, THAT THEY ARE NOT
IDEOLOGICALLY SOUND, AND THAT THEY COULD THREATEN PARTY CONTROL.
MODERNIZATION OF THE ECONOMY
ALTHOUGH BY 1985 GORBACHEV HAD BEEN ON THE POLITBURO FOR
SIX YEARS AND A CENTRAL COMMITTEE MEMBER FOR 14 YEARS, HE NOW
ADMITS THAT WHEN HE BECAME GENERAL SECRETARY HE UNDERESTIMATED
THE SEVERITY OF THE ECONOMIC PROBLEMS AFFLICTING THE SOVIET
UNION. ACCORDINGLY, HE SEEMS TO BE INCREASINGLY RECEPTIVE TO
MORE RADICAL PROPOSALS FOR CHANGE. MANY OF HIS RECENT REMARKS
SHOW INCREASING FRUSTRATION OVER THE LIMITS IMPOSED ON HIS
ac
FREEDOM OF MANEUVER BY THE STALINIST-ERA C-GW4At 1 ECONOMI DOGMA
HE HAS INHERITED.
ESSENTIALLY, HE SEEMS TO HAVE ADOPTED A THREE STEP APPROACH
TO REVIVING THE ECONOMY. INITIALLY, GORBACHEV RELIED ON A
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COMBINATION OF MEASURES TO STRENGTHEN PARTY CONTROL, IMPROVE
WORKER ATTITUDES,-:AND WEED OUT---INCOMPETENCE -_ WHAT HE REFERS
TO AS "HUMAN FACTOR" GAINS. THE MOST VISIBLE AND DRAMATIC PART
OF THESE EFFORTS HAS BEEN HIS CAMPAIGNS FOR DISCIPLINE AND
AGAINST CORRUPTION AND ALCOHOLISM. THESE MEASURES ARE INTENDED
TO INCREASE PRODUCTIVITY AND GNP SIMPLY THROUGH HARDER AND MORE
DISCIPLINED WORK FOR TWO OR THREE YEARS UNTIL MOMENTUM CAN BE
SUSTAINED BY THE SECOND AND THIRD STEPS -- GENUINE IMPROVEMENTS
IN INDUSTRIAL PRODUCTIVITY THROUGH MODERNIZATION OF THE
COUNTRY'S PLANTS AND EQUIPMENT, AND THROUGH ECONOMIC AND
POLITICAL REFORM.
GROWTH PUTTERED IN 1987 AS T INITIAL EFFECTS OF THE
DISCIPLINE AND EMPERENCE CAMPA NS BEGAN TO WEAR OFF AND
GORBACHEV'S NEW EM SIS ON ALITY CONTROL INSPECTION
DISRUPTED INDUSTRIAL P DU ION SCHEDULES. WE ESTIMATE GNP
GROWTH WAS ONLY 1.0 - 1. U AST YEAR AND THE OUTLOOK FOR 1988
IS NOT MUCH BETTER. A EW PR RAM WILL CAUSE FURTHER CONFUSION
AND DISRUPTIONS AS M Y ENTERPRIS ARE UNABLE TO PAY THEIR OWN
WAY WITHOUT STATE UBSIDES. THE ADV SE IMPACT OF NEW PROGRAMS
THAT CAME INTO FECT ON 1 JANUARY WILL AVE FURTHER RIPPLE
EFFECTS THRO HOUT THE ECONOMY.
THE JUNE 1987 CENTRAL COMMITTEE PLENUM PROVIDED THE
CLEAREST EVIDENCE SO FAR THAT GORBACHEV SEEKS A RADICAL
OVERHAUL OF THE STALINIST COMMAND ECONOMY. THE BLUEPRINT FOR
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REFORM ADOPTED IN JUNE CONTAINS THE OUTLINES OF A NEW, MORE
MARKET BASED MECHANISM FOR RUNN LNG~_THE;ECONOMY THAT I BELIEVE
GORBACHEV WILL PUSH.
TAKEN AS A WHOLE, THE REFORM MEASURES PUT IN PLACE IN
GORBACHEV'S TWO AND A HALF YEAR TENURE ARE AN IMPRESSIVE
PACKAGE THAT IN SCOPE AND SPECIFICITY GOES WELL BEYOND THE
SO-CALLED KOSYGIN REFORMS ADOPTED IN 1965. NEVERTHELESS, THE
REFORMS DO NOT GO NEARLY FAR ENOUGH. THE REFORM PACKAGE AS NOW
CONSTITUTED IS A SET OF HALF MEASURES THAT LEAVES IN PLACE THE
PILLARS OF SOCIALIST CENTRAL PLANNING.
BECAUSE OF INTERNAL CONTRADICTIONS AND THE RETENTION OF SO
MANY ELEMENTS OF THE PRESENT SYSTEM, THE REFORMS HAVE YET TO BE
IMPLEMENTED.AJ EVEN IF FULLY IN PLACE IN 1991 AS INTENDED, TkEy
WILL NOT CREATE THE DYNAMIC ECONOMIC MECHANISM THAT GORBACHEV
SEEKS AS THE MEANS TO REDUCE OR CLOSE THE TECHNOLOGICAL GAP
WITH THE WEST. INSTEAD, THEY SPELL TROUBLE FOR HIS ECONOMIC
PROGRAM GENERALLY. INDEED, AGGRESSIVE IMPLEMENTATION OF
REFORMS IS CAUSING SERIOUS DISRUPTIONS AND TURBULENCE IN THE
ECONOMY AND WILL CAUSE MORE AS THE BUREAUCRATIC FACTIONS
ATTEMPT TO ADJUST TO THE MANY CHANGES BEING IMPOSED FROM
ABOVE. SPECIFICALLY:
-- GORBACHEV'S QUALITY CONTROL PROGRAM IS DISRUPTING
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