ASSESSMENT OF COMMUNIST SUCCESSES, PROBLEMS AND PROSPECTS BY THE HONORABLE ALLEN W. DULLES PRESENTED AT THE NATIONAL WAR COLLEGE WASHINGTON, D.C. 3 FEBRUARY 1956

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CIA-RDP80M01009A001402440007-8
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February 3, 1956
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Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 ASSESSMENT OF COMMUNIST SUCCESSES, PROBLEMS AND PROSPECTS BY The Honorable Allen W. Dulles Presented at The National War College Washington, D. C. 3 February 1956 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 . Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 ASSESSMENT OF COMMUNIST SUCCESSES, PROBLEMS AND PROSPECTS By The Honorable Allen W. Dulles (3 February 1956) ADMIRAL WOOLDRIDGE: Gentlemen of the National War Col- lege and the Industrial College of the Armed Forces:- It is very fitting that we complete our consideration of the study of the Soviet Bloc by making an assessment of the prospects of the Communist cause. It is also most fitting that we have as our guest today the man who is best qualified to assess the successes, the problems and the prospects of this revolutionary movement. Our guest, the Honorable Allen W. Dulles, has not only a background for making this assessment due to his having been Deputy Director of CIA and now the Director of CIA, but he has been a lifelong student of the study of the problem powers. He has had extensive experience, both in peace and during two wars, asia student and as a participant in the solution of these power problems. It is a great pleasure to welcome back to this platform today and to present to this audience the Director of Central Intelligence Agency, Mr. Allen W. Dulles. Mr. Dulles. MR. DULLES: Admiral (Wooldridge), thank you very much. In the old days I used to call you "Slim," when we were working together on the Senior Staff (as I believe they Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2913/03/19: CIA-RDP80M01009A001402440007-8 6 L ? called it then), now the Planning Board of the NSC. I always had great admiration for the way you handled a difficult task. The Joint Chiefs, of course, will never say naything about what they think until they get it all nicely before them in final form. "Slim" had to interpret what their views were going to be before he really knew what they were. He very rarely missed. Very seldom, as I remember it, did the Joint Chiefs come up with a view differ- ent from "Slim's." You have a very wise director here. The Admiral referred to the fact that X had been involved in the problems resulting from two world wars. He suggested that I might have helped toward solving some of these postwar problems. They don't seem to have stayed solved very well. When I look back on my own modest participation at an early age in drawing up the Treaty of Versailles I am not sure that we showed all the wisdom required by the circumstances at that time. However, I have always thought the Treaty of Versailles was better than some people said it was. At least, after World War I, we had a peace treaty. Now, we have had World War II, and we still haven't a treaty. You have given me quite a subject today -- "Assess- ment of Communist Successes, Problems, and Prospects." -2 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 I want to begin with certain basic assumptions. You may or may not agree with them, but I accept them as a useful way to approach the subject you have given me. First, there has been, so far as I can see, no change over the years in basic Soviet objectives. There have been tactical changes, variations within the traditional zig- zag theory of Communism under Leinin and Stalin. There have been tactical retreats when situations demanded, but the Communists have always kept an eye on their main goal. I believe that our policy makers must not be deceived or taken in -- and I believe that they have not been by temporary shifts in Soviet policy. I have the impression that some people thought our policy makers were taken in at the time of the so-called Summit conference. I can assure you, -- on the basis of having participated in drawing up some of the position papers for that meeting, -- that we were in no way deluded by Soviet gestures at that time. It was not possible, however, in view of world public opinion, to take an adamant and hostile position toward the Soviet desire to talk. As a second basic assumption, I believe that as long as the present leadership and political system prevail in the Kremlin, there will be no drastic change in the final objective of international Communism, -- domination of the world. - 3 - ????? Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 ' Declassified and Approved For Release 2013/03/19 : CIA-RDP80M01009A001402440007-8 " E _ . It follows that any changes we may consider making in our own position should depend on Communist performances, not on Communist promises. Even then, we must be aware of the danger that their actual deeds may be no more than traps to delude us into believing that a change has taken place when actually it hasn't. Here I au thinking particularly of the Austrian treaty. The motive behind the Soviet agreement to sign the Austrian treaty was to set up the Summit meeting. The Commu- nists were also moved by certain pressures to which I shall refer later. As another fundamental proposition, I believe that the Communists will continue their massive military build-up. They will hold this power as a threat over the heads of the weak and the neutralist nations and as a deterrent to the United States and its allies. Later, possibly, if they cannot achieve their ends by any other means, they will use this power at a time of their own choosing. I hope I am wrong about that, but I think we must proceed on that assump- tion since it may well be actual Communist policy. They do pay lip service to raising the standards of living in the Soviet Union and to dealing out more con- sumer goods, but this is only a secondary objective. They will continue to devote, as they are doing today, some 35 percent of their gross national product to capital investment - 4 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 ? M? __Ut and design in order to produce more end items. These are, and will be, largely military goods. They will take every measure they can to increase output in their heavy industries. In 1950 this output was roughly one-fifth of American production. If their current Five-Year plan, projected through 1960, is carried out, their output will rise to about two-fifths of our own. We cannot assume that they will fail to reach the goals of this Five- Year Plan. In the past they have generally come close to their objectives in heavy industry, but they have not met their goals in agriculture and certain other fields. It's worth noting that the present Five-Year Plan calls for tripling and in sone cases quadrupling production of electronic items. It provides for a sixfold increase in the production of special heat resistant alloys, thus under- lining the emphasis they are placing on guided missiles and jet engines. (This, of course, is public. They published it in their Five-Year Plan.) As far as perfornance to date is concerned, their 1955 steel production rose to 45 million netric tons. American production was 106 million metric tons. Their primary aluminum production increased to 500,000 netric tons. The United States produced 1,250,000 tons. - 5 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 They are giving particular emphasis' to these items. While their production is still less than half of ours, it is worth noting that they are narrowing the gap. At the , same time, in comparing production on a per capita basis, we must remember that their population is substantially larger than ours. Nevertheless, their intention to emphasise heavy industry and military end it. is obvious. In addition to the items I have mentioned, their greatest emphasis will probably be in the fields of nuclear research and development, guided missiles, and long-range, high-speed aircraft. By contrast, their production of automobiles and trucks is only one-twentieth of ours. They manufacture one- fiftieth the nunbor of washing machines that we do. They're doing a little better in radio and television sets, but they still lag far behind. In any case, the basic Soviet intention to con- centrate on heavy industry and military strength is evident. This, intention, as well as accomplishments so far, aro clear indications of basic Soviet policies, and they reveal a great deal about the general Soviet posture in the world today. Turning to smother phase of their basic posture, I think their foreign policy is dominated, at least for the imsediate future, by a determination to avoid the risk of a - 6 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 .?n major war. In the present stage of their nuclear development, aircraft production, -- particularly of long-range bombers and guided missile development, they do not wish to run the risk of massive nuclear retaliation. Hence, they will pro- bably avoid risky adventures. Whether they will continue to exercise such caution when they feel they can deliver nuclear weapons by long-range 01?11/0 aircraft or missiles is a question which will bear very close scrutiny at the proper time. That time does not seem to be here yet, but they can, of course, deliver bombs on us today if they want to use one-way missions. At the present time they regard themselves as encircled by our overseas bases. In my opinion, the effort to undermine these bases by getting the peoples concerned to drive us out will, in the days ahead, be one of the main themes of Soviet policy. We can see that they are watching closely the development of this line in North Africa. They will continue to encourage and foment such activity. They will harass everywhere they can, even with the Eskimos, to make us feel that our bases are not safe and cannot be counted on in an emergency. With these basic elements of Soviet policy in mind as I have sketched them, I should like to draw a trial balance sheet on where we stand in the cold war at this time. - 7 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 SECRET This country first became aroused about the nature and magnitude of the Communist threat sometime around 1946- 1947. For a long time both the people of this country and even some who were in positions of high authority did not seem to realize what the Communists were up to. It's a funny thing, but we don't seem to believe what these people write. When they write books setting forth their program, it is worth our time to read them and reflect on them. Hitler wrote "rein Kampf." Everyone had a chance to read it, but no one paid very much attention to it. Yet, up to a point, what Hitler said he was going to do in his book was what he actually did. I do not doubt, if we read what the Communist leaders write, that we can find out pretty well what they are up to. In any case, we did not do much readng back in 1946 and 1947, and what we read then was usually not Communist literature. It took actual events to awaken us to the Soviet challenge. From about the middle of 1946 on Greece was threatened by a possible Communist takeover. Iran and Turkey, especially Iran, were threatened by Communist aggression. The European economy, -- with some rather clever maneuvering by the Communists in a situation which was already chaotic -- began in 1947 to head toward real disaster. - 8 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19 : CIA-RDP80M01009A001402440007-8 - Czechoslovakia fell to the Communists in 1948. I -think this was the blow that did more to wake people up than any other single thing. A country was conquered without a single shot having been fired. At the time of the takeover the Communists had only about 38 percent of the seats in parliament. They showed us that we don't have to wait until there is a Communist majority before there is a real danger. Following the Czech coup, we had a bad scare in the 1948 Italian elections. The Communists threatened to take over that country by winning the election. Disaster was nar- rowly averted. The Berlin blockade started in June 1948. Meanwhile, we were in the process of losing China. Thus, from 1946 through 1948 there was a series of events -- / have not tried to name them all -- which served to wake us up to the facts of life about Communism. This period I should call the first Communist threat. To answer this threat, we responded with actions of our own. American aid to Greece started in 1947. Eventually, under General Van Fleet and others, the Communist menace in that country was turned back. Tito's defection from the Kremlin fold was a valuable assist in the Greek problem. His action had the effect of sealing off a good part of the Greek frontier with an adverse effect on Communist subversive activities. - 9 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 --MET Shortly before this, the Communists were ousted from the governments of both Italy and France. They have not regained this stature since, although they have been able to maintain strong parliamentary representation. The Marshall Plan was passed in A pril 1948. The airlift broke the Berlin blockade. Planning for NATO proceeded. By the middle of 1949 the free world, and partic- ularly the United States, had responded with at least reasonable success to the various Soviet challanges in Europe. We were not so fortunate in the Far East. China was finally lost, and Indochina was being threatened. This phase I should call the first Communist threat and the first part of the free world's answer. Then, possibly because the free world response had been fairly effective in some parts of the 'world, and partly because we did not seem to have any answer to the Communists in the Far East, the second threat became apparent The major action in this new Communist campaign was, of course, the attack in Korea, which was followed by a stepping up of the war in Indochina. What we did in Korea to meet this second challenge is a matter of history and needs little discusaion. While a total victory was not won, at least the enemy was stopped - 10 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 cold and did not achieve his objective by the means he had chosen. I have a feeling that this may have had more to do with changes in Communist techniques than anything else. It probably had much more to do with these changes than the death of Stalin. In Indochina we had to settle for half a loaf, and a pretty soggy half at that. On the other hand, the second Communist threat had the effect of hastening the entry of West Germany into MATO and plans for rearming the Germans. In the Far East the Manila Pact was signed. Congress passed a resolution about defending Taiwan and the Pescadores. In the Middle East, the Baghdad Pact took shape. In Iran, Mossadegh was overthrown. An anti-Communist govern- ment was installed. In our own hemisphere, Arbenz was driven from Guatemala. Generally_ the second threat ended with the West doing rather well, again responding somewhat more succeesifully in Europe and the Middle last than in the Far last. There is one little item which we tend to forgpt. While the Communists have been boasting of their successes, 1,250,000 Germans have fled from their Communist "paradise" in East Germany since 1949. At the present tine, the flow of refugees from the Communist to the Free World in this area Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 , Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 alone has grown to nearly 1,000 a day. While the Nast Germans are trying to build up their army, more and more of their young men of military age are fleeing to the free world. Now I come to the third Communist threat and to the problem of what the best answer will be. Briefly, the third threat is the new Soviet policy, the "new look." It emerged gradually and became most clear at the time of the Summit conference. The new look includes the Communist "ruble, rifle, and rice" policy in the Biddle East, South and Southeast Asia, -- the arming of trouble- makers, economic penetration, appealing to neutrals, and treating the Biddle Eastern Arabs much as the big bad wolf k treated Little Red Riding Hood. It has often been said that this new policy was a result of Stalin's death. This assumes hoc, Lose propter hoc, which is about all the Latin I know, and which is a slogan which can lead to more errors in intelligence than almost any other slogan I know. The more fact that after Stalin's death the Communists changed their policy does not necessarily mean that they would not have changed their policy in anjcase. There are some indications that such a change was being considered before Stalin died. It is obviously more difficult to change your policy when your dictator is a stubborn old man who won't admit he was ever wrong. So the ?12? Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 rCRET change in policy was probably easier to carry out after the old man died than it would have been if he had lived longer. In any case, there are other and more compelling reasons for the Communists' changing their policy. I think they felt they had not done too well with their policies up to that time. Atter our intervention in the Korean war, the possibilities of that situation must have been frighten- ing to then. I think they may have felt, as they analyzed the situation in the Kremlin, that they had come very close to getting themselves involved in a wiljor war at a time when they were not ready for such a war. This business of sending your minions to fight for you while you stand on the side- lines looks fine; but if your lackies don't do well, then you have to go into action yourself. At this particular stage, the COmmunists decided on a policy which might still yield large dividends and had the advantage of being such less risky, They began by making a series of gestures aimed at presenting themesilves as peacelovers, taking on a peaceful posture in order to attract sympathy from the neutralists and the weaklings. They chose as their primary target the soft underbelly of Asia, stretching from Syria to Thailand. Then came the Summit conference. As I have said, I don't think our policy nappers were caught napping. A refusal to go, in view of public opinion around the world, -13- Declassified and Approved For Release 2013/03/19 : CIA-RDP80M01009A001402440007-8 Declassified ,and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 SECRET would have been more harmful than going Even so, merely by attending we gave the Communists an appearance of respectability and undoubtedly gave them some temporary aid in carrying out their new policy. The reversal of the Soviet attitude on the question of the Austrian treaty is a good example of a Communist action which made a substantial impact on world opinion. At about the same time they swallowed all the threatening words they had uttered about what they would do if West Germany were armed. They did nothing about it. I believe they did at least try to restrpin their Chinese allies from going too far on the offshore islands situation. They settled for their own h lfa, loaf in Indochina, even though it seemed at the time that they could have, by taking some risks, secured the whole loaf. Thus they prepared the world for their new policy by appealing to the former colonial areas in the Near and Middle East, by offering economic aid, and by giving military aid where it would cause the most trouble for the Western powers. The Communists are in a very good position to offer substantial military aid. As you well know, they are chang- ing over from MIG-15's to MIG-17's and other more advanced Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 planes. The 1L-28 is an obsolescent bomber, but MIG's and IL-28's are pretty hot weapons for the Middle Eastern nations, The Communists have plenty of old tanks, too. They may even have some old submarines which they would be perfectly will- ing to give away, if they thought they could cause enough troubles I imagine that a submarine or two in the Red Sea would do just that. Certainly the IL-28's now in the hands of the Egyptians are something of a worry to the Israelis and to others. The Communists have become merchants of death on a large scale at little or no cost to themselves, except, possibly freight charges. They have used their satellites in a very subtle way in this armaments game, letting the Czechs or Poles or Hungarians front for them so that the offers are more palatable than they would be if the hand of Moscow were openly displayed. We have been making a series of studies trying to keep up with the various Communist offers and the size of their total effort. It is a confusing exercise, First, it is very hard to judge how firm some of the offers are. Again, it is difficult to fix an actual value to these offers. They have probably promised somewhere around 300,600,000 dollars worth of goods and technical aid to various countries in the Near and Middle East. This figures may be something Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 like the actual value by our standards, but it is not what the offers will cost the Communists. For example, let us assume that what they are giving to Egypt could be sold in a "normal" market for 160 or 200 million dollars. Giving these items to Egypt has not cost the Soviet Union anything like that amount of money. They have promised India a aillion-ton steel mill, which would be one of the largest steel sills in the country. The Soviet contribution to this mill will cost the Indians in the neighborhood of 100,000,000 dollars, but the major part of the Soviet aid will be in the fora of ? loan, not a gift, -- a loan with very low interest rates. As you know, they have offered the Afghans a credit of 100,000,000 dollars, We are getting some of the details about this offer, and it turns out to be somewhat different than it first looked, It is a credit apparently extended over a number of years with partial amounts to be drawn down annually. The agreement permits either side to terminate the arrangement at any time. The Afghans won't be such interested in ending the credit, but the threat that the Communists can is present, If the Afghans don't behave, they may be denied their next installment. The Communists are buying rice from Burma, They are building plants there and elsewhere; they are offering to - 16 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19 : CIA-RDP80M01009A001402440007-8 build bridges and railways, The Poles have offered to build a railway-in Saudi Arabia. They have offered to help with the building of the Aswan dam in Egypt, a project which will involve goods and services running into hundreds of millions of dollars in value and requiring substantial expenditures outside Egypt The whole Aswan dam undertaking, including the high dam, will cost close to 1,500,000,000 dollars, About half of this work would be done with local labor and Egyptian resources and the rest would come from abroad. Even if the Egyptians turn down the Communist offer in favor of finanding by the International Bank the offer by itself indicates the size of the projects in which the Communists are evidently willing to engage. A great many of the Communist offers may not be accepted; some have not been finally settled. Although we learn of new offers every day, the whole program is still more in the stage of promises than performances. The Communist approach is very subtle, and it is having a great impact in underdeveloped areas. Some months ago, I gave a briefing in the National Security Council about the Communist campaign. I was ahked why the Soviet program was having such an impact in view of the fact that as far as actual money, actual hardware and actual accomplishments were concerned, the Communist offers and promised were far less than what we had already done in the same area for years. 17 ? Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 , The answer to this question -- which is obviously an important part of the Western answer to the third Soviet threat -- is not easy to come by. I drew up a little paper which I summarized for the Security Council a few days ago. tried to list some of the factors were operating in favor of the Communists and against us, The first thing seems obvious, -- the problem of colonialism. The people in the underdeveloped countries, many of which have recently gained their independence, believe that the United States is tied in with the colonial powers, -- in the West by our membership in NATO; in the Far last, through SZATO. They see the United States and the United Kingdom concerting their action in the Near last. They fall for the Communist allegation that our aid programs are a form of economic colonialism or imperialism. These tomer colonial countries suffer from an inferiority complex in their dealings with the West, and they tend to react by self-assertion and opposition. Also, unfortunately, for a long time Westerners have far too often acted in a tactless and overbearing manner toward the people In these areas. The former colonials have not forgotten the Kipling concept of "lesser breeds." The Communist approach is very astute. They have successfully created the impression that they do not look on these people as "backward" or "undeveloped," -- words found - 18 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 InT7 too often in the Western vocabulary. The contrast which has grown between the Russians and Americans and Europeans together" with racial and geographical background of many Russians, has made it possible for the Russians to get themselves accepted in many places as non-Europeans, non- Westerners, and, hence, as fellow Asians. Many people in this area also feel that the Communist movement is a movement which they can join and thereby gain a social status which they have never had before. It 18 not like the Western clubs from which they have been barred. These same people are able, by some logic of their own, to overlook completely the facts of Soviet colonialism, both in the European satellites and in the ruthless suppression and even liquidation of minorities within the Soviet Union itself. The Communists have also been very flexible in their negotiations. They haVe asked no obvious quid pro quo in the fora of political alignments or *DAP-type agreements. They have no Battle Act problems. They make a great point of saying their aid 14 offered "without strings." Moreover, they can tailor their offers to fit the local situation. They can underbid anyone anywhere they choose I have always felt that one of the major problems when it comes to making our policy effective in this field was the fact that we seemed to be tied down by so many ? -19 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 congressional "inhibitions." These are actually safeguards designed to protect the American taxpayer, and they quite correctly seem reasonable to the legislator. However, the official who goes out to Indonesia and other countries and asks them to sign specific agreements about their own trade finds that they feel a new kind of servitude is being imposed on them. The effort to overcome this feeling delays and hinders our whole aid program. The Communists enjoy another practical advantage in theft trade program. The United States has little interest in acquiring the surplus products of many countries 1because we have a surplus in the same products such as Cotton, rice, and rubber. Egypt Burma, Ceylon, Indonesia, and Thailan have to have a market for these particular commodities. The Soviet bloc will accept these products and in turn give arms and other aid. They offer low interest rates and easy payment terms. They will accept local currencies which they can also use as a handy local was chest for whatever subversive activities they may choose to launch. The countries in this area believe moreover that the West, particularly the European countries, want to continue - as they have done in the past - to discourage industrialization so that the Western powers can keep markets for their own industrial goods -20- Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/1b-: CIA-RDP80M01009A001402440007-8 These countries now see our aid tapering off, and they hear our public discussions about the possibility of ending such aid, discussions which are often carried on in language which offends these countries. Many countries dislike seeing the bulk of American aid going to individual or regimes which they do not like. India. is a particularly good example, cNehru doesn't like to see our aid going to Chiang Kai-shek and Syngmau Rhee. By giving to Israel, we have aroused the enmity of the whole Arab world. Whether this aid is worthwhile is not the question.. I am speaking of the effect our actions have on neutralist and other nations. ? Obviously) there is no reason why we should pattern our policies to fit the desires of the neutralists. They resent our alliances or close ties with such groupings as SEATO and the Baghdad Pact but in many instances their failure to belong is entirely a matter of their own choosing. In any case, our taking sides or even? appearing to take sides Kives the Communists an opening. When the Commu- nists took the side of the Arabs in the Middle East they acquired a new atttactiveness throughout the Moslem world. By contrast, our support for Israel and France and Britain makes our position seem ambiguous, if not hostile, to the Arabs. When we support Pakistan, we alienate India and Afghanistan. -21-- Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 - rriE Perhaps none of these factors, which favor the Communist cause, is as important as the attitude of these new nations toward their own economic aspirations, -- their desire to achieve an economic revolution. Many of them assumed that when their colonial or protected status ended, economic progress,would follow automatically and swiftly, It did not, and we have been the ones to impress on them the fact that economic progress must be slow and required the laying of solid foundations, the undertaking of long-term projects, In their impatience, they look at the Soviet Union and are profoundly impressed. Thirty years or more ago the USSR was almost as backward industrially as these budding countries. In a short space of time -- short as compared with the hundreds of years of the Western industtial revolution -- the Soviet Union has reached a position where it is now, in the eyes of many of the new nationr, the second military, industrial, and political power in the whole world and a leader in science and technology. The Communists claim that all this progress has been the result of applying the Communist theory, We know this is false, but through subtle and persistent propaganda they have been able to make many people believe that it is true. Thad() people tend to believe that if they cooperate with the Communist bloc they, too, can somehow magically -22- Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 acquire the rate and size of growth which they see in the Soviet economy. They believe that Communist China is following the path of the Soviet Union, and they think that the Chinese will in time match the Russian accomplishments. This Communist example, be it true or false, encourages the undeveloped countries to press for rapid progress in economic development, sometimes heedless of risks. They want the prestige and stature which would go with these attainments even before they have reached their goals, The Communist propaganda and attractive offers feed on these desires and whet their appetites. Westerners, by contrast, seem gloomy about progress and act as though they are trying to hold the new nations back. Finally, many of these countries have now decided that they can have and enjoy the best of both worlds, the Free world and the Communist world. They are trying to work both sides of the street, play one side against the other. They are beginning to conclude that if they are the beneficiaries of Soviet aid, the United States will be even more anxious to give them matching or greater help. Those countries which have chosen to adopt a neutralist role feel that they can best maintain their position if they accept aid from both the United States and the Soviet Union. Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 We have ample evidence that this last factor is becoming very fashionable. Some of our staunch allies feel that they say have made a mistake in not getting a little Soviet aid on the grounds that we might then rush them sore Arai or money. This attitude is a serious problem. All these factors throw light on the nature of what I call the third Communist threat. The answer is in the making. I cannot tell you what it is today, but I can tell you that at the highest levels close study is being given to the best methods of meeting this subtle, insidious "new look" in Communist policy. I can tell you some of the things which we feel are not required. We do not think that this threat can be Answered adequately by another great outpouring of money. As we have said publicly, we do not feel that it can be answered by running after the Communists and trying to outbid them everywhere. There have been some positive suggestions about what we ought to do, but at the moment it is easier to indicate what a good answer is not than to show what a good answer is. Some people suggest that we let the Communists go ahead with their offers on the grounds that they will fall flat on their faces in performance. - 24 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 ? Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 We cannot be entirely sure about that. They may fall on their faces in some cases, but they may also be successful in many instances. They have the capability to carry out many of their offers, and it is reasonable to assume that they will want to make a good showing before the world. The danger is that once the Communists get hold of a country, there isn't any second guess about getting it back, except possibly going to war. Hence, it is not the kind of game in which you can sit back and say: "Well, let's just see how it works out." If we wait or guess wrong, that particular game is -over and done with. I do not think, however, that we have any reason whatsoever to accept the predictions of some of the prophets of doom in our press and of other pundits throughout the world who tell us, "All is lost." I trust I have been able to show today that we met the first and second phases of the postwar Communist threat with reasonable success. I think that we shall go right ahead and respond successfully to the third Soviet challenge, even though the nature of the response is not as readily clear as it was in the case of the first two threats. We have the benefit of hindsight on those. , We must remember that the Communists have their own problems. They are perhaps more difficult to see than our own, but they are nonetheless real. - 25 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 During the last war, when I wan is Switzerland, I was able to get a look at what was going on in Germany. I remember that at a time when this great Nazi organism seemed absolutely unbreakable, the seeds of its own destruction were present and readily apparent. I do not go so far as to say that the seeds of destruction are as apparent in the Soviet system today, but there are real problems. There is the problem of leadership in the Kremlin. Khrushchev seems to be moving along pretty rapidly. Each one of the recent changes in administrators may be a move toward slowly getting people he can control into positions of power. There is some question in my mind whether he has the qualifications for a dictator, but his moves may arouse the suspicions of other members of the Soviet hierarachy. This raises the general question of how long a committee fora of government can last in a state like the Soviet Union. They have not solved their agricultural problems. They have done well in heavy industries, but they have made little progress in agriculture. They are net importers in farm products. They have begun a massive experiment to open up new lands, but it does not seem to be going very well, and further difficulties may lie ahead. They are trying to open up areas where there is only marginal rainfall. A couple of years of drought there, and they could end up with nothing but a gigantic dust bowl. -26 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 When we look at a sap of the Soviet Union and see its great expanses, we must remember that in most of the country no grain will grow, and that very little corn can be grown other than where it is already cultivated. The southern!Ukraine, which is their great grain-producing region, is like our own Dakotas. Much of the rest of the country is out of bounds as far as extensive farming is concerned. The Communists are not easy about the situation in their satellites. The Soviet grasp is firm, but the Communists are evidently puzzled about what to do over the long run, Their situation in East Germany may now be more precarious than it ever has been. So long as they keep 400,000 troops in the country, obviously nothing drastic can happen. But they have been trying to turn the country over to the Nast Germans, and the Germans are dragging their feet. They cannot get qualified people to take government jobs, and they face a real problem with no solution in sight. They are still trying to maintain iron discipline within the Soviet Union, even though they have felt it necessary to relax a little from the Stalinist standards. Whether they consider this relaxation as both desirable and necessary is not clear. -27 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 As I have said, they are putting all their em- phasis on heavy industry, and giving very little of the fruits of Soviet economic progress to the people. They may not be able to go on like that forever. Apparently on the positive side, they are stepping up, at a perfectly fantastic rate, the education of their people, especially in the sciences. One of the most dangerous features, I think, of Soviet policy today is the number of scientists they are educating. About 60 percent of their university graduates are in scientific fields. Only about 25 percent of ours are. Soon they will be turning out more scientists than we are, and before too many years they will have more scientists than we do. However, even this apparent strength raises a problem. The other day in a talk at Columbia University I asked the question: Can you educate people to the extent that the Communists are doing and not have these people begin to think about the facts of life, -- not have these people begin to realize that they are being denied the basic freedoms which ordinary human beings demand? Some of us have felt -- I know I did at one time, but I have changed my mind somewhat -- that if you keep a country under an iron rule like the Communist system long enough, the people will forget what liberty is. It hasn't -28 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 I Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8 worked out that way. We have had many, many defectors who have come from countries where the people have never known any form of government except a Communist regime, and yet, these people have instinctively rebelled against tyranny. I feel that the desire for liberty is an inherent quality of the human race and cannot be wiped out. It may well be that the Communists' disregard for the decency of the individual human being will be their Achilles' heel. This may be a problem more serious than any they will have to face in more worldly affairs like agriculture or technology. Thank you very much. - 29 - Declassified and Approved For Release 2013/03/19: CIA-RDP80M01009A001402440007-8