TALKING POINTS FOR THE DCI SITUATION IN POLAND

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP89G01321R000700350004-4
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 14
• Document Creation Date: December 23, 2016
• Document Release Date: August 27, 2012
• Sequence Number: 4
• Publication Date: September 20, 1988
• Content Type: REPORT

Declassified in Part - Sanitized Copy Approved for Release 2012/08/27 : CIA-RDP89G01321 R000700350004-4
20 September 1988
LAST-MINUTE ITEMS FOR PFIAB MEETING
Wednesday, 21 September 1988, 10:30-12:00
TAB A Poland: What's Next? Attached are talking points
that discuss what could happen next in Poland
regarding the historic "round table" meetings
involving regime, independent, solidarity and church
participants. Also attached are several graphics that
provide additional information on the situation in
Poland.
TAB B Afghanistan: Status of the Soviet Withdrawal.
Attached is a graphic you may wish to use with the
talking points on this subject that I provided you
over the weekend.
TAB C Nicaragua: Current Situation. Attached are graphics
that go with the talking points I provided you last
weekend on this subject.
TAB D Libya: CW Program. Attached in the envelope are
recent photos of the Libyan chemical production
facility in Rabta. These photos compliment the
talking points I gave you last weekend on this subject.
[Multiple copies of the graphics are available if you wish to
hand any of these out to the PFIAB members; only one copy of
the photography is available.]
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DDI/EURA
20 September 1988
Talking Points for DCI
Situation in Poland
The stage is set for historic "round table" meetings, reportedly beginning in mid-October,
to involve regime, independent, and Solidarity participants, and church mediators. Terms
were hammered out in difficult, direct talks last week between Solidarity leader Walesa
and Interior Minister Kiszczak.
-- Walesa failed to get Solidarity relegalized as a precondition to the round table,
but the regime agreed the future of Poland's trade union movement, along with
industrial reform, will top the agenda. Although opposed to Solidarity's
relegalization, Poland's official union, will join discussions with Walesa and his
lieutenants.
-- Walesa apparently compromised on relegalization because Kiszczak convinced
him that recognition of Solidarity at this tense juncture would spark a
conservative backlash that could sweep party moderates from office.
-- Walesa was successful in resolving grievances over punishment of striking
workers.
During the coming month both sides will have to strengthen their bargaining positions by
imposing more internal unity and defining their strategies. The situation is very fragile
and the movement towards national reconciliation could be easily derailed.
The party is in turmoil and has no clear vision of how to deal with Poland's massive
economic and political problems. Its overriding objective remains preserving Communist
Party supremacy over the economy and public life.
Kiszczak may have overstated the power of party hardliners, but they have
criticized the meetings with Walesa and bitterly oppose the regime's trial
balloons such as a liberal associations law, free factory-level trade union
elections, and free elections, open to the opposition, for a large block of
parliamentary deputies. Moreover, hardliners could still provoke an "incident" to
torpedo the talks.
-- The party's privileged apparatus and the state's planning bureaucracy constrain
the latitude for reformers to liberalize economic policies; one party liberal
estimated it might take the politically unthinkable elimination of 50,000 planning
positions to free the economy from Stalinist centralization.
Walesa, trying to consolidate his gains, has already moved to strengthen his control over
the fractious union opposition by including young strike leaders in his Solidarity
delegation but he continues to face daunting challenges.
He must put together, from a welter of suggestions, a reform program to
negotiate with the regime.
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He must hope the young militants come prepared to follow his lead in
bargaining rather than to table radical demands that will polarize the talks.
He must extract some early concessions from the regime in order to convince
skeptical workers to give the round table time, to accept some hardships, and to
forestall disruptive new strikes that could sabotage the talks.
Both sides look to the church to restrain hardliners and to formulate a "middle way"
acceptable to all parties. Neither side probably has considered carefully the compromises
it might eventually accept; the church's evenhandedness and persuasiveness may
therefore be the decisive catalyst if imaginative new political and economic solutions are
to evolve.
Cardinal Glemp and his former seminary mate Bishop Dabrowski have personally
intervened to bring Walesa and Kiszczak together; both have castigated the
regime and Solidarity in the past for taking extreme positions.
Glemp has reportedly assigned a priest close to the Pope as the regular church
mediator, apparently reserving the right to reintroduce Dabrowski if the talks are
at a stalemate.
force a settlement.
Both the regime and Solidarity agree that the immediate priority must be given to
economic reform and reversing the deterioration of living standards.
Prices and wages spiral upwards -- inflation is running over 60 percent this
year -- but real incomes are still more than 10 percent below 1980 levels, and
supplies of consumer goods have deteriorated.
Poland's hard currency debt rose to $39.2 billion last year; Warsaw's ability to
meet even its rescheduled debt payments will be hurt by efforts to reduce
unrest by importing more consumer goods, and by cutting exports to keep up
domestic supplies.
Poland needs hard currency loans to modernize industry and expand exports but
access depends on demonstrating to Western countries and the International
Monetary Fund progress on economic reforms.
The regime has made the government the scapegoat for mismanaging the economy and
Premier Messner resigned on Monday.
A government shake-up will not convince Solidarity that more rational policies
will emerge but the regime could set the tone for cooperation on reform by
naming a well-respected economist or Catholic independent as Premier.
Alternatively, Jaruzelski might tap a regime moderate -- such as Kisczak --
with whom Solidarity will deal and who is able to overcome hardline resistance
in both the government and party bureaucracies.
For now, there appears to be little agreement among senior regime officials on how to
tackle Poland's economic crisis.
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Poland: Chronology of Strikes and Roundtable Talks
August-September 1988
15-18 Aug 88
22 Aug 88
26 Aug 88
31 Aug 88
01 Sep 88
04 Sep 88
10 Sep 88
15-16 Sep 88
19 Sep 88
Strikes spread at Polish coal fields; miners make economic
and political demands.
Gdansk shipyards and port join strikers; Walesa joins
strikers, calls for relegalization of Solidarity.
Minister Kiszczak announces government willingness to
hold roundtable talks with opposition, including
Solidarity leader Walesa, after earlier attempts to
intimidate strikers failed.
Kiszczak and Walesa meet, on anniversary of Gdansk accords,
to discuss preparations for future roundtable talks.
Walesa calls for suspension of strikes.
All strikes end.
Solidarity activists in Gdansk demand Solidarity's
egalization before roundtable talks begin; regime rejects
such "preconditions".
Preliminary meetings between Kiszczak and Walesa; both agree
to round table talks set to begin in mid-October.
Government resigns because of mismanaged economic reforms, strikes.
New government to form in October. New economic programs due in
November.
Confidential
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Poland: Income and Cost of Living, 1977-88
Index: 1981 = 100
soo,
40
1977 1979
? First half of 1988
1981
1983 1985
Poland: Hard Currency Debt, 1977-87
Billion US $
1987 a 1989
1977 1978 1979 1980 1981 1982 1983 1984 1985 1986 1987
0
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Factors Influencing Instability in Eastern Europe
Over the Next Two Years
External Nett
Leadership Societal Economic I nfluences Judgment
-" /
coo ~~ fi 3? 4"i &~ o v? 3w
Bulgaria
o
o
0
Cl
0
Cl
0
0
0
0
Czecho
Slovakia
0
Q
0
Cl
0
Q
0
G
East
Germany
-~
0
0
0
0
0
~.
Q
_-
Q
vO
Hungary
-
0
0
Q
3
Q
0
O
.
Romania
?
0
0
0
0
02
__-
('_
~
6
Yugoslavia
9
0
Q
0
0
,
6
Q
Q_
Q
_.__.Q
0 Little to None a Low
Q Moderate & High
. Very High
1 In this column we assess the likelihood of serious, system shaking unrest
2Although Romania's debt is relatively low, Ceausescu's policy of rapid repayment has
drastically reduced living standards.
3Although Hungary does not have a significant domestic ethnic minority, political activity on behalf
of the Hunganan minority living in Transylvania (Romania) is on the rise.
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Secret
NICARAGUA: Soviet Bloc and Cuban Assistance,
1983 - 1988
650
600
550
500
40
rn 450
b 400
350
v 300
c 250
200
150
100
50
0
1983
1984
1985
1986
*Doesn't include possible hard currency assist.,
which averaged $85 mil per year, 1985 and 1986.
* Estimates through 30 June.
Secret
1987
1988**
K
0
Military
Economic
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