ANTICIPATORY PAPERS--MY VIEWS ON IMPLEMENTATION

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP85M00366R000200080017-5
• Release Decision: RIFPUB
• Original Classification: S
• Document Page Count: 2
• Document Creation Date: December 20, 2016
• Document Release Date: January 14, 2008
• Sequence Number: 17
• Publication Date: November 4, 1981
• Content Type: MEMO

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? JC11 RG 1 ?
4 November 1981
MEMORANDUM FOR: Henry S. Rowen
FROM: NIO/Econ
SUBJECT: Anticipatory Papers--My Views on Implementation
I believe this is an extremely useful exercise. Here are my comments
on how some of these proposals might be implemented. I may have comments
on other proposals later.
INTERNATIONAL ECONOMICS
A Major Oil Price Decline
I believe this could be done as a NIC memo, based partly on NFAC's
analysis of oil market prospects. Although the odds are against an abso-
lute decline in oil prices, they will probably be higher in 1982 than at
any time in the foreseeable future. This possibility should also be con-
sidered in the Global Economic Estimate.
A Difficult Economic Transition for Mexico
I will discuss this with NFAC. To be useful the paper requires an
analysis of potential political divisions as well as of economic
problems. I doubt that the NIC has the right person to draft on this
subject, but someone should do it.
Britain Pulls out of the Common Market
We should discuss this both with NFAC and with outside experts. The
subject is too complicated for a NIC memo.
Persistent OECD Stagflation
I plan to handle this question as one of the main issues in the Global
Economic Estimate. To give it focus, I would like to present it as a con-
tingency in which, because of continued high long-term interest rates, US
economic recovery is substantially delayed, and the Europeans lose patience
with us. Although being severely constrained in their macroeconomic policy
options, the Europeans may retaliate against us and the Japanese in the
trade field, on East-West matters and in the political/military area.
There are two major variants of this problem--(1) The French and Germans
work together; and (2) they follow divergent economic policies.
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Implications of Continued Japanese Export Surpluses
This issue should be part of the main line of NFAC analysis and will
also be given prominence in the Global Economic Estimate. A NIC memo
should be considered only if NFAC does not treat the subject adequately.
Consequences of Another Oil Supply Disruption
The odds on an oil supply disruption which would have a serious impact
are extremely low for the next year or two. In the longer term the odds
are quite high. This issue is now part of the main line NFAC analysis of
prospects for the international oil market. A major paper is being pre-
pared. Once it is completed, we can see whether an NFAC memo should be
written to spell out political implications, etc.
OTHER PROPOSALS
Implications of Oil Discoveries in West Africa
An NFAC article on this topic has already been written. Additional
work should be part of the main stream.
Indonesia When the Well Runs Dry
This too should be main stream analysis. The point is that NFAC and
others should take a long term look at Indonesia, and I believe this is
being done.
Soviet Questions
I believe the Soviet issues should be further sorted out. What we
need to do is to lay out the assumptions on Soviet behavior and priorities
that underlie our present estimates and then question these assumptions.
The most interesting question seems to involve their attitude toward
Eastern and Western Europe and their willingness to take chances in trading
off objectives in these areas.
Other
More generally, there are too many topics. Many could be merged
(e.g., Implications of Diminishing Soviet Control over Eastern Europe and
Effects of Persistent Stalemate in Polish Crisis). Others could be focused
better e.g., Permanent Vietnamese Occupation of Kampuchea).
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