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1999

The Deepening Crisisin the USSR: Prospectsfor the Next Year

National Intelligence Estimate

This National Intelligence Estimate representsthe views of the Director of Central Intelligencewith the advice and assistance of theUS Intelligence Community.

71.

-SeeretNlE 11-18-90November 1990

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Director ofCentralIntelligence

NIE 11-18-90

The Deepening Crisisin the USSR: Prospectsfor the Next Year

Information available as of 1 November 1990 was usedin the preparation of this National Intelligence Estimate.

The following intelligence organizations participatedin the preparation of this Estimate:The Central Intelligence AgencyThe Defense Intelligence AgencyThe National Security AgencyThe Bureau of Intelligence and Research.Department of State

also participating:The Deputy Chief of Staff for Intelligence.Department of the ArmyThe Director of Naval Intelligence,Department of the NavyThe Assistant Chief of Staff, Intelligence,Department of the Air Force

This Estimate was approved for publication by theNational Foreign Intelligence Board.

Socrot November 1990

Sacra+

The Deepening Crisisin the USSR: Prospectsfor the Next Year

• No end to the Soviet domestic crisis is in sight, and there is a strongprobability that the situation will get worse—perhaps muchworse—during the next year.

• The economy is certain to decline, and an economic breakdown is apossibility. The central government will be weaker, and some .republics will be further along the road to political independence.

• The current situation is so fragile that a combination of events—such as the death of Gorbachev or Yel'tsin, a precipitous economicdecline, massive consumer unrest, or an outbreak of widespreadinterethnic violence—could lead to anarchy and/or the interventionof the military into politics.

• The certain continued diffusion of power will make the conduct ofSoviet foreign policy more difficult and complicate relations withthe West. At a minimum, Western countries will be confronted withmore urgent pleas for economic assistance—especially from repub-lic leaders, who will also push for political recognition.

—Seswt-NIE 11-18-90November 1990

Figure 1Scenarios for the Next Year

D'77 r. 111 '11Pl iffIni ;El

aisoluu.

Scenario a Factors That Could Lead to Scenario Rough Probability

DeteriorationShort of Anarchy

-

....... . Failure to agree upon and implement effectively a far-reaching marketization plan; or the broad resistance of thepopulation to such a course.

Failure of the center and the republics to move to new,mutually acceptable political and economic relations.

Inability of political institutions to adapt to changing politicalrealities, and ineffectiveness of new democraticallyelected leaders in governing.

Continued, though diminished, viability of the centralgovernment.

•

,.:%,.

., ..,

-,

Close to even

_

,

Anarchy A precipitous decline of the economy.

Massive social protests or labor strikes that proved to bebeyond the security services' ability to control.

The assassination of Gorbachev or Yertsin.

The complete breakdown of relations between the centerand the republics--especially the Russian Republic.

I in 5 or less

Military Intervention(ranging from a coupto civilian-directedmartial law)

..i.,.

- .• ---..

'

Breakdown of key elements of the national economy. suchas the transportation system.

Violence against central government institutions.

A situation approaching collapse of central authority.

Anarchy.i

5.

I in 5 or les.s overall;much lower fora coup

.

"Light at the End ofthe Tunnel"

...-vi...;,-

Substantial progress toward:

o Developing a new set of relationships allowing the republicsto deal constructively with each other and the center.

a The filling of the political power vacuum by new politicalinstitutions and parties.

a Establishing new economic relai ions based Ohen t m:irket.-

I in 5 or less

a These scenarios are analytical constructs describing overall directionsthe USSR could take over the next year and arc not nultually exclusive.

3210e., 11 90

iv

Key Judgments

The USSR is in the midst of a historic transformation that threatens totear the country apart. The old Communist order is in its death throes. Butits diehards remain an obstructive force, and new political parties andinstitutions have yet to prove their effectiveness. The erosion of the center'sinfluence, coupled with the republics' assertion of sovereignty, is creating apower vacuum. Gorbachev has amassed impressive power on paper, but hisability to use it effectively is increasingly in doubt. Meanwhile, economicconditions are steadily deteriorating.

Whether the Soviet Union over the next year can begin to find a way out ofits crisis will hinge, above all, on two variables:

• The performance of the economy. The question is not whether theeconomy will decline further but how steep that decline will be. Aprecipitous drop would make crafting a new center-republic relationshipnext to impossible and markedly increase the likelihood of serious societalunrest and a breakdown of political authority.

• The Gorbachev-Yertsin relationship. Because of the Russian Republic'sdisproportionate size and influence in the union and Yel'tsin's role as themost prominent leader of the new political forces emerging throughoutthe country, the more open the confrontation between the two leaders,the more destabilizing it would be.

In our view, prospects for positive movement in each variable are low.Gorbachev's economic reform plan, while endorsing marketization, falls farshort of what is needed to stem the economy's decline. And the Yertsin-Gorbachev clash over the plan.bodes ill for both economic and center-republic reform.

For these reasons, we believe that over the next year a scenario of"deterioration short of anarchy" is more likely than any of the other threescenarios that we consider possible (see table). There is, however, asignificant potential for dramatic departures along the lines of the"anarchy" or "military intervention" scenarios.

In our most likely scenario, deterioration short of anarchy, the country'seconomic, political, ethnic, and societal problems will continue to get worseat an accelerating rate. Gorbachev probably will remain president a yearfrom now, but his authority will continue to decline. His ambivalence

Secret

Socrot vi

toward radical transformation of the system probably will continue todelay decisive action and dilute the effectiveness of efforts to implementmarket reform or negotiate a new union. Yel'tsin's popularity and controlover the Russian government will give him significant influence on thecountry's course over the next year. The different visions the two men haveof Russia's and the USSR's future are likely to lead to more damagingpolitical clashes. However, a combination of the remaining powers of theold order and the limited reforms the regime implements would prevent theentire system from disintegrating.

In view of the volatile situation that prevails in the USSR today, however,we believe that three other scenarios—each roughly a 1-in-5 probability—are also possible over the next year.

• An accelerating deterioration is unlikely to continue indefinitely andcould during the next year become a free fall that would result in a periodof anarchy—the breakdown of central political and economic order.

• The chances for military intervention in politics would increase markedlyin a scenario where the country was on the verge of, or in, a state of anar-chy. Military intervention could take several forms: a military coupagainst the constitutional order, rogue activity by individual command-ers, or martial law ordered by Gorbachev to enforce governmentdirectives. Of these, Intelligence Community analysts believe a coup tobe the least likely variant and a civilian-directed martial law the mostlikely.

• A "light at the end of the tunnel" scenario, where progress over the nextyear toward the creation of a new system outpaces the breakdown of theold, cannot be ruled out. There would be further progress towardmarketization and pluralization in spite of continued economic declineand political turmoil.

Whichever scenario prevails, the USSR during the next year will remaininward looking, with a declining ability to maintain its role as a superpower.The domestic crisis will continue to preoccupy any Soviet leaders and promptthem, at a minimum, to seek to avoid direct confrontation with the West.But the particular foreign policies they pursue could vary significantlydepending upon the scenario. Under the "deterioration short of anarchy" or"light at the end of the tunnel" scenarios, Moscow's Western orientationprobably would be reflected in continued, possibly greater, Soviet willingnessto compromise on a range of international issues.

Special requests to the West for consultations, technical assistance,emergency aid, and trade from the central and republic governments arecertain to increase. Unless political conflict over who owns resources and

controls foreign trade is resolved, which is unlikely, both US governmentaland private business relations with the USSR and its republics will beincreasingly complicated.

An "anarchy" scenario would create precarious conditions for relationswith the West and would present the United States with some difficultchoices. If the situation evolved into civil wars, we would face competingclaims for recognition and assistance. The prospects for the fighting to spillover into neighboring countries would increase. The West would beinundated with refugees, and there would be enormous uncertainties overwho was in control of the Soviet military's nuclear weapons.

In a "military intervention" scenario, a military-dominated regime wouldtake a less concessionary approach than Gorbachev's on foreign policyissues and pursue a tougher line on arms control issues and economicrelations with Eastern Europe. A military regime, however, would beunable to restore Soviet influence in Eastern Europe and would be too busyattempting to hold the USSR together to resume a hostile military posturetoward the West.

vii Soorot

Egeve."-Se hicui

Contents

Page

Key Judgments Discussion 1

Toward a New Political Order 1

Political Strategy of the Key Players 2

Impact of Other Players 4

The Crumbling Union 7

What Kind of Union? 10

The Economic Variable 11

Erosion of Central Control 11

Labor and Ethnic Strife 1 2

Financial Imbalance 1 3

Market Reform 1 3

Four Scenarios 1 4

Deterioration Short of Anarchy 1 5

Anarchy 16

Military Intervention 1 7

"Light at the End of the Tunnel" 1 7

Implications for the United States 1 8

Annex A: Emerging Democratic Leaders 21

Annex B: Emerging Traditionalist Leaders 23

1ix —S-cc ret-

Discussion

Since the Intelligence Community's last Estimate ofthe Soviet domestic situation a year ago,' the USSR'sinternal crisis has deepened considerably:

• The Communist Party is dying but is still obstruc-tive. Gorbachev has tried to shift the locus of powerto the new presidency and legislatures, but theyhave yet to demonstrate their effectiveness.

• New political groups and parties have won power inkey republics and cities and are posing a growingchallenge to the Communist system.

• The national government is scrambling to controlcentrifugal trends, but its writ over the republics isfast eroding, and there is growing ethnic turmoil.

• Economic problems have become more intractable.The uncontrolled growth in demand and distribu-tion problems have created increasing consumerdiscontent. Gorbachev has lost valuable time instabilizing the economy and beginning the transitionto a market economy.

Our previous Estimate, while foreseeing the tumult,overstated the regime's ability to contain the repub-lics' drive for sovereignty and underestimated thechallenge to Communist Party rule from new politicalforces.

In such a volatile atmosphere, events could go in anynumber of directions. Because of this, the IntelligenceCommunity's uncertainties about the future of theSoviet system are greater today than at any time inthe 40 years we have been producing Estimates on theUSSR. Accordingly, our projections for the next yearwill be highly tentative.

NILE 11-18-89 . November 1989, The SovietSystem in Crisis: Prospects for the Next Two Years..

1

Toward a New Political Order

The Communist Party's monopoly of power is history.The party is widely seen as the source of the country'sproblems, and popular hatred of it is increasinglyevident. It lost its constitutional guarantee of politicalprimacy in March, and its 28th Congress in Julyexcluded government leaders (except for Gorbachev)from key party posts. The country's two largest citiesand largest republic, as well as the three Balticrepublics, Georgia, and Armenia, are now headed orhave legislatures dominated by former or non-Com-munists.

A new pluralistic, decentralized political system isemerging but is not yet capable of running thecountry. The center and the Communist Party stillexercise a considerable, though declining, share ofpolitical power. But the CPSU is too discredited toattract sufficient popular support needed to govern inthe current environment. At the same time, theemerging political groups, while showing strength, arestill small and inexperienced in the ways of power andarc not competitive on the all-union level (see inset,page 3).

The governmental institutions to which Gorbachevhas been attempting to shift power are likewise only intheir formative stages. The Congress of People'sDeputies (CPD) is foundering. The Supreme Soviet—elected by the CPD—has shown more promise, but isalso losing influence because of its lack of popularlegitimacy, its inability to act decisively, and thecenter's difficulty in maintaining control over majorsectors of government. Gorbachev has made the presi-dency the highest organ of executive power, supplant-ing the CPSU Politburo and the Council of Ministers,but its real authority remains to be proved. Thisdiffusion and confusion of power, coupled with therepublics' assertion of sovereignty, is creating a power

Figure 2. Yen sin and Gorba-chev: Beyond the smiles, canthey cooperate?

vacuum. Gorbachev has amassed impressive power onpaper, but his ability to use it effectively is increasing-ly in question and his popular supportf

jis dwindlingE

Political Strategy of the Key PlayersGorbachev's defeat of the party's conservative wing atthe congress has given him greater room to maneuver.The pressure created by Yel'tsin's growing influencehas made Gorbachev realize that he must work withYel'tsin and other non-Communist forces. He nowaccepts the inevitability of a weaker central govern-ment and a market-oriented economy. Yet Gorba-chev, afraid of social upheaval, wants to preserve asignificant measure of control over events. This hasled him to try to bolster his powers as President, limitthe influence of new non-Communist political forces,retain significant powers for the center in a newunion, and water down the Shatalin Plan for transfor-mation to a market economy. This course is at oddswith Yel'tsin's on some key issues and is slower andnot as far reaching as we believe is necessary.

The political forces outside the Communist Party arecertain to get stronger; there is as yet, however, nocoherent strategy among those forces as a whole.Many non-Communist figures are concentrating theirefforts on organizing political parties. Others whohave already won elections, such as Yel'tsin and

Moscow Mayor Gavriil Popov, have shunned involve-ment—for the time being at least—in any politicalparty and concentrated on the basics of governing (seeannexes). If they demonstrate over the next year thatthey can get things done and make the voices of theirconstituents heard, the prospects for a more rapidemergence of a non-Communist leadership on the all-union level would increase markedly.

Yertsin's immediate goal is achieving sovereignty andgreater power for the Russian Republic (see p. 7); butthe enormous size of that republic and his reputationthroughout the USSR as unofficial leader of the non-Communist forces make him a formidable competitorto Gorbachev. Yel'tsin, who quit the CPSU in July,supports a multiparty democracy, rapid movementtoward a market economy, and a much looser union inwhich the republics grant only limited powers to-thecenter.

Currently, Yel'tsin appears to have the politicaladvantage over Gorbachev; he is far more popularthan Gorbachev in USSR-wide opinion polls. In thesix months since Yel'tsin became Russia's President,the two have had periods of cooperation and confron-tation. Their willingness and ability to cooperate willplay a critical role in the fate of political, economic,and center-republic transformation in the USSR overthe next year. Whether they will do so is open toquestion, given their mutual personal antagonism,

3

2Scorot

Embryonic National Political Parties

. -A wide array cif political groups is emerging in theUSSR as the country moves toward the develoiii - •ment of a multiparty, state-of-law political system.They have the potential to gain significantelector-al support but--except for those in the Balder andthe Caucasus—have yet to develop into full-blownpolitical parties. The groups generally lack clear,comprehensive political platforms, and none has aformal membership of more than several thou-sand. Several groups claim to be parties or willclaim that title soon. Although based in the Rus-sian Republic, they have some following in otherparts of the country.

Democratic Platform. This group of democraticreformers from the CPSU is in the process oftransforming itself into an independent party. Itsleaders predict that 30 percent of the currentCPSU membership will eventually join the newparty, but the actual figure is likely to be lower.The party's platform supports the market as theprime regulator of the economy, private property,and "independence" for the republics.

Democratic Russia. This group is currently servingas a legislative coalition and has run proreformcandidates for local and Russian Republic elec-tions. It embraces an assortment ofpolitical forcesopposed to CPSU traditionalists. The group cur-rently has strong majorities in the Moscow andLeningrad city councils and a thin majority inRussian Supreme Soviet.

Social DernocraticiParty:.: Founded in jartuary1990, this: iiiiftY is trying to asia.'ciateliself withEuropean Social Dimcierats. It has generally sup-ported Gorba.4ev bitt:has charged hine.with beingtoo cautiotiiiiiidieekliti to perpetuatean authori-tarian system.

Christian Democratic Union of Russia. This partyopenly opposes Gorbachev. It insists that "Russiashould become independent of the USSR" byestablishing new forms &federation with otherdemocratically inclined republics. The party's eco-nomic platform rejects capitalism -while supportinga 'free market controlled by society" and a pro-gressive tax scale to protect the poor.

Democratic Union. Radical by Soviet standards,this party believes the Soviet political systemshould be thoroughly overhauled to establish avoluntary federation of republics based on a West-ern-style multiparty system and a full marketeconomy. Party leaders have stressed the need toconfront government authorities in order to bringattention to the repressive character of the Com-munist system.

Green Party. This party is taking shape amongapproximately 300 ecological organizations. Theseorganizations agree on the need to protect theenvironment but have not been able to develop aconsensus on other political or economic issues.

'

different policy agendas, and political rivalry. Openconfrontation would stymie system transformationand lead to greater instability. Cooperation would notguarantee peaceful transformation, but it would helpsignificantly by garnering popular support for painfuleconomic measures linked to marketization and bymaking it more difficult for the entrenched partymachinery in the countryside to be obstructive. IfYel'tsin follows through during the next year on his

3

pledge to stand for popular election to the RussianRepublic presidency, a decisive victory would furtherenhance his political influence.

Gorbachev, the Supreme Soviet, and the Congress ofPeople's Deputies, elected before the establishment ofindependent political parties, lack the popular support

Secret

Sc.r.rfat

necessary to push through the difficult and painfulmeasures needed to deal with the country's crises.Accordingly, Gorbachev could decide during the nextyear to create a "roundtable" between the govern-ment and non-Communist leaders a la Poland in 1989or perhaps even form a grand coalition. This wouldinvolve the removal of the increasingly ineffectiveNikolay Ryzhkov from the premiership. Elections forthe Congress of People's Deputies are not due until1994 and for the presidency until 1995, but Gorba-chev may calculate that holding early legislativeelections would allow new parties to gain representa-tion. Submitting himself to the popular will would berisky, and he is unlikely to do so during the comingyear.

Impact of Other PlayersThe Armed Forces and Security Services. Leaders ofthe military and security services perceive dangerousconsequences from Gorbachev's domestic and foieignpolicies. These concerns reflect alarm over the collaps-ing authority of the party and the central government,growing domestic disorder, the unchecked spread ofseparatist movements, and the breakup of the EastEuropean security system.

4

1

iThese organizations will find their ability to cope withgrowing internal disorder limited over the next year.The military is averse to using its troops to police thepopulation. Moreover, most Soviet troop units,

because they are conscript based, are ill suited tocontrolling disorder--especially in Slavic areas. TheKGB's ability to perform its internal security mission

5

.............1m.

\

will also decline as more light is shed on its activities, forces. The Ministry of Interior, despite a growth inindependent political movements grow, and more local manpower, is stretched thin and cannot control wide-governments come under control of non-Communist spread domestic unrest.

S t.l..1‘..t 6

Figure 4. Demonstrations onMay Day 1990 in Red Square.Banner reads: "Power to thepeople and not to the party!"

Despite their apprehension over the current domesticsituation and concern about their abilities to performassigned missions, the military and security servicesdo not pose a serious challenge to Gorbachev's leader-ship. They view themselves as instruments of the stateand are attempting to help Gorbachev in dealing withthe turmoil. Even with their many internal problems,they represent the most reliable institutional assetsremaining at Gorbachev's disposal.

Society. Popular anger is growing, as is belief in theinability of the central government to lead the countryOut of the morass it is in. Deep pessimism about thefuture prevails, especially when it comes to bread andbutter issues. People are searching for something tofill the emptiness in Soviet society through suclialternatives as religion and nationalism. In particular,Russian nationalism—more likely in an inward-look-ing, rather than chauvinistic, variant—will play agrowing rote in the future of the country.

The reforms under way have given the peoples ot toeUSSR greater say in their political and economiclives, and they have expressed their views through theballot, demonstrations, strikes, and violence. The pop-

ulation's influence is likely to grow even more duringthe next year as power continues to move away fromcentral institutions. How this influence is exercisedand channeled will be critical variables. Separatistgroups and new political parties—primarily on theleft, but also from the right—will tap much of thispopular activism. This will increase their importancebut could also embolden them to take steps that leadto greater instability. Outbursts of civil disobedienceare almost certain to grow; they are more likely tooccur—and be most severe—in non-Russian areas butprobably will also take place in the largest cities of theRussian Republic and in energy-producing regions.

The Crumbling Union

The Soviet Union as we have known it is finished. TheUSSR is, at a minimum, headed toward a smaller andlooser union. The republics, led by Yel'tsin and theRSFSR, will intensify efforts to reshape the unionindependent of the center, further loosening Moscow's

7

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Figure 5Soviet Republics

grip over their regions. To date, these efforts arcmostly declaratory; actual control over institutionsand resources in the republics is still to be tested.

In an effort to cope with the nationalist forces strain-ing the fabric of the union, Gorbachev now supports asubstantially widened scope for market forces and theconclusion of a new union treaty by early 1991 thatwould establish new power-sharing relationships be-tween Moscow and each republic. We doubt, however,that a new union treaty can be concluded within thenext year. Gorbachev has indicated he will accept areduction in the center's authority but so far isattempting to hold on to more authority than most

republics want to concede. The initiative now residesmainly with the republics, and any new treaty islikely to be driven more by what powers they arewilling to grant the center than by what Gorbachevwants (see figure 6).

Because of the disproportionate size and influence ofRussia, a new union treaty will not be concludedunless Yel'tsin and Gorbachev work together. Howfar many of the other republics go in demandingsovereignty will be directly affected by Russia's suc-cess in negotiating with the center and with the otherrepublics.

8

• YesIN NoA Unknown

Republic (in order of declaration)

Unclassified 128488 11-90

Figure 6USSR: Soviet Republic Sovereignty Declarations

Seeks immediate secession • • •Nmintaistaximisiniera

Supremacy of republic laws • • • • • • • • 0••••••_

Right to republic military troops • • •111111111IN••111•1110A

Independent eoonomic policy 000•000000000AA

Republic banking, tax, currency • 0011190812•0 '0 ' AA

Independent foreign relations 000•0000000000 A

Control over natural resources • • • • 0000•00000A

Republic citizenship • • • • •••••••••• A

Military neutrality NEINNINEINI bOOMINNAA

Nuclear-free state NOINNINNESINO••10 N , A

participant in union treaty talks • 0 in • • • • • • • • • • • •

a Turkmen SSR and Tajik SSR have asserted the tight toindependent republic banking.

Moldova has declared itself to be a demilitarized zonc.Kazakh SSR, site of principal nuclear test range, has

banned all nuclear testing and construction or operation oftest sites for weapons of mass destruction.

9

The Union Treaty Areas Over Which theCenter Seeks Control

Gorbachev apparently .wants to maintain theprimacy of union laws over republic ones and topreserve substantial central control of.-• Natural resources and land.• Defense and state security.• Foreign policy.• Macroeconomic policy.• Foreign trade and customs.• Border control.• Science and technology policy.• Power supply.• Transportation.• Protection of individual rights.

The Range of Republic Demands

The two largest and most powerful republics,Russia and the Ukraine, now support a severelylimited central government and union as theydemand substantial control over their own •af:fairs. The Russian Republic legislature is call-ing for primacy of its own laws over Soviet ones;control of the republic's land and natural re-sources, fiscal policy, police and internal securi-ty forces, mdst economic enterprises, foreigntrade, and some role in foreign and monetarypolicy. The Ukraine has gone further, assertingthe right to establish its own army, and Belo-russia and the Central Asian republics are alsomaking far-reaching demands. The three Balticrepublics are flatly rejecting political affiliation •with the center before achieving independence.Georgia, Armenia, and Moldova, in which se-cessionist sentiment is especially strong, appearunwilling to sign a union treaty but are seekinga gradual transition to independence.

CarrAt

steps in defining the republic's relationship with Mos-cow. Rukh supports a complete break with the centralgovernment, but more traditionalist forces in theRussified eastern part of the republic are likely to tryto impede any abrupt declaration of independence.

What Kind of Union?The process of reshaping the union will vary accord-ing to the republic over the next year; at a minimum,the center will suffer a dramatic reduction in author-ity.

There is a better than even chance that Moscow andcertain republics—Russia, Belorussia, Azerbaijan,and the Central Asian republics—will move toward aloosely affiliated union of republics. We believe thatGorbachev will ultimately go a long way to meetRussia's autonomy demands as long as the centralgovernment retains a meaningful role in the newunion. Considerable difficulties and hard bargainingremain; but so far the demands of Russia and theseother republics do not appear irreconciliable withGorbachev's (see insets).

Thus, there is still a significant chance that Moscowwill be unable to reach a mutually acceptable divisionof responsibilities even with the core Slavic republics.Moscow could reject their current demands, or theRSFSR or Ukraine could escalate demands in areassuch as defense and monetary policy to the pointwhere Gorbachev would feel he had no choice but toresist. A number of factors could contribute to abreakdown in negotiations, including a continued risein Ukrainian nationalism, worsening of relations be-tween Gorbachev and Yel'tsin, or rising popularunrest directed against central authority. In thesecircumstances, struggle for control of key institutionsand enterprises in the republics would ensue, leadingto sharp—probably violent—confrontation, with thevery existence of the union at stake. The advantage inthis scenario would belong to the "locals."

The Ukraine's future status is more uncertain. Grow-ing radicalization of the nationalist organizationRukh and the population generally has pushed theUkrainian legislature to take increasingly assertive

The Central Asian republics appear ready to try out areformed union as a way of addressing their economic

Ecorc t 10

difficulties. Market reform will create disproportion-ate economic pain in the region, however, and couldeventually produce disillusion with even a looserunion.

Although no republic is likely to become officiallyindependent within the next year, the Baltic republicsare almost certain to hold out for full independenceand will be on their way to getting it. Latvia andEstonia will probably be willing to consider some kindof voluntary economic association with the SovietUnion now, but Lithuania is likely to be willing to doso only after achieving complete independence. Geor-gia, Armenia, and Moldova will probably reject anyunion treaty but will adopt a more gradual approachto independence than the Baits. As Georgia andMoldova press for independence, ethnic minoritiesthere are likely to intensify calls for autonomy. Thisprobably would not deter republic efforts. But Mos-cow may yet be able to play on Georgian andArmenian concerns about.susceptibility to potentialTurkish or other Muslim aggression without theprotection of the Soviet security umbrella. And a shiftin Romania toward greater authoritarianism wouldprobably make the Moldovans more willing to stay inthe union.

The Economic Variable

Last year the Soviet economy slumped badly, andofficial statistics for the first nine months of 1990paint a picture of an economy in accelerating decline.Output is down compared with a year ago, inflation isup, and shortages arc widespread and increasing.Even though imports and production of some consum-er goods are up (such as in agriculture and consumerdurables), transportation bottlenecks and systemicinefficiency are denying consumers much of the bene-fit. Meanwhile, continued rapid growth in persdnalmoney incomes and a huge backlog of excess purchas-ing power have combined to undermine the ruble and

11

cause a vicious circle of shortages and binge buying,enflaming consumer anger and leading to violence.

In the year to come, the economy's performance willdepend on how central authorities manage erosion oftheir control over the economy, the level of labor andethnic strife, the success of regime efforts to overcomethe acute financial imbalance, and the course ofmarketization. In view of our assessment of theprospects for each of these variables, we believe thatthe economy will continue declining at an acceleratingrate and there is a possibility of an economic break-down (see inset, page 13).

Erosion of Central Control -The transition from the command economy to a moredecentralized market system will ultimately yieldmajor gains in performance. In the short run, how-ever, central controls have begun to wither before aneffective new system has been put in place. TheCommunist Party is no longer able to enforce thestate's economic orders; economic reforms have givenstate enterprises and farms the legal basis to resist thecenter; and the pursuit of independence and autonomyat the republic and enterprise levels have disruptedold supply and demand relationships.

Over the next year, these trends are almost certain tocontinue, and the center could be weakened to a pointwhere it would lose control of the allocation of vitalgoods such as energy, key industrial materials, andgrain. Attempts by regional authorities to protecttheir populations from rampant shortages will worsenthe current economic turmoil. At the same time, theinterdependence of the republics and localities and the

Sccrot

CIA estimates. b C1A estimates cxccpt 1990, which is a Soviet official statistic.

1986 87 88 89 Jan-Sep90

1986 87 as 89 Jan-Sep90

Cc°, ct 12

AVAIJAKE.Figure 7Soviet Economic Performance Down

NOTE: January-September 1990 is compared with January-September 1989.

328485 11.90

interest of the regional authorities in avoiding eco-nomic chaos will continue to argue for restraintagainst severing old relationships.

Labor and Ethnic StrifeLabor and ethnic problems over the past year havebeen major contributors to the USSR's economicturmoil. Poor living and working conditions, increas-ing shortages, and greater awareness of the workers oftheir lot have led to falling worker motivation andfueled labor and ethnic unrest. Because these prob-lems are certain to get worse in the year to come,labor strife will continue, and faith in governmentsolutions to labor problems will remain low.

The economy is most vulnerable to work stoppages inthe transportation and energy sectors. The railroadsystem has virtually no slack capacity or substitutes.Strikes in this sector would immediately damage thealready fragile supply network, grinding other sectorsto a halt and probably leading to the use of themilitary to run the railroads. Similarly, an upsurge inunrest in a large republic such as the Ukraine or inthe Great Russian heartland would be especiallydamaging to the economy.

Economic Breakdown

A severe breakdown in the coordination betweensupply and demand is rare historically and hasbeen a result of revolution, war, or disastrouseconomic policies. Under present circumstances,such a breakdown could be precipitated bymassive popular unrest, regional autarky thatdestroys trade flows, a radical economic re-form, or prolonged strikes of transport workersor workers in basic industries such as steel andenergy.

Indicators of such a breakdown would be:• A decline in GNP of at least 20 percent.• Hyperinflation, massive bankruptcies and

unemployment.• Paralysis of the distribution system for both

industrial and consumer goods.• Dramatic flight from the ruble that results In

barter trade or payment in hard currency.

Financial ImbalanceMoscow has struggled unsuccessfully in the past twoyears to slow or reverse the growth of the excesspurchasing power that has destabilized consumermarkets. The key to reducing the dangerous backlogof excess purchasing power in the year ahead is tolower the budget deficit and proceed with pricereform. Despite the stated intention of the Gorbachevreform program, however, it is doubtful that Moscowwill move quickly in either area. Making a dent in thisproblem will require further cuts in state spending forinvestment and defense and reductions in social ex-penditures, particularly the huge subsidies for food.Moscow still fears popular reaction to price increases,however, and a large safety net is an integral part ofthe Gorbachev program. If the government continuesto defer decisive action on these issues, the threat of areal financial crisis will deepen considerably andfurther complicate reform efforts.

13

Market ReformThe Gorbachev program approved by the SupremeSoviet in October endorses markctization but fails tocut the bureaucracy immediately, thus making it easyfor recalcitrants to block progress (see inset). The plan .also sets no specific goals or timetables for denational-ization of state assets. Although Gorbachev's advisersindicate that this lack of detail is designed to leave therepublics free to work out the specifics of denational-ization, the program's reliance on state orders andadministered prices for at least another year willsharply limit the number of enterprises that could bedenationalized. In addition, the plan's measures tostabilize the economy arc misconceived—immediatelarge increases in wholesale prices and continuation ofsubsidies to consumers through l9)2 will spur infla-tion and undercut deficit reduction.

Overall, Gorbachev's program is a heavily politicaldocument aimed at garnering republic support whileretaining substantial power for the center. It adopts aslower, more cautious approach on. moving toward amarket than the Shatalin Plan—supported by theRussian and other republics—and thereby probablyruns less risk in the short term. The limitations of theGorbachev program are such, however, that it isunlikely to deliver the promised economic gains and,as a result, over the longer term it will court greaterpolitical problems than the Shatalin Plan would have.As the program's deficiencies become apparent in themonths ahead, the leadership is likely to considermore radical measures to achieve a transition to amarket under even more dire economic conditions.With this program or any other that may be adopted,it is impossible to overstate how difficult, painful.and contentious it will be for a large multinationalstate to move from a command to a market economy.

Secret

18- to 14-month conversionto market period in four.stages but without a definiteschedule for each stage.

Both center and republicshave budget and tax au-thority; center taxation re-quires republic concurrence.Center retains control overkey exports for some peri-od, shares hard currencyrevenues with republics.

Price reform

Foreign economicrelations

Increase wholesale pricesaccording to governme.n1:,,schedule; enterprise con-tracts to use these prices.State orders and centraldistribution, not prices,to determine most allo-cation.

Moves gradually towardruble convertibility.Calls for increased lati-tude on foreign invest-ment, including 100-per-cent foreign ownership offirms.

Key Elements of Gorbachev'sMarket Reform Program

Timing

Center-republicpowers

Stabilization Reduce deficit to 2.5-30 bil-lion rubles—cut defense, in-vestment, enterprise subsi-dies. Maintain keyconsumer subsidies. Fi-nance deficit with bonds.Absorb ruble overhang withbond, consumer warrantsales; sales of some otherstate assets; and through in-creases in saving interestrates.

'54V :kI:744`N.2?.1.epubli* lOontr,01,Mdi

.."4!`.....• •.:assetsA,them:territories,.....a! set• •-•pace Rep:

■■

nership..of land.

Privatization,

EEST CUltAriaRtr

Four Scenarios

I wouldn't hazard a guess.

lzvestiya commentator's answer to USEmbassy officer's question in Julyabout how he envisioned the USSR intwo to three years.

The interaction of political, ethnic, and economicvariables will determine the fate of the country overthe next year: major deterioration in any one area

would severely strain the current system; breakdownsin all three would mean anarchy. Economic break-down, in particular, would make crafting a newcenter-republic relationship next to impossible andmarkedly increase the likelihood of serious societalunrest.

A further diffusion of power from the center in allthree areas—political, economic, and center-repub-lic—is certain. Gorbachev's authority will continue to

14

decline, although he will probably remain in office ayear from now. Even under the most optimisticscenario, the Soviet domestic crisis will be far fromresolved in one year's time. The turmoil will continueregardless of the policies pursued. Progress could bemade in some areas. But the risk of sudden majordiscontinuities will remain, and it will take years—atleast a decade or more—to find lasting solutions tothe country's ills.

Given the unpredictable nature of events in thevolatile situation that prevails in the USSR today, webelieve that four scenarios capture the range ofpossibilities during the next year: deterioration shortof anarchy; anarchy; military intervention; and "lightat the end of the tunnel" (see figure 1). Thesescenarios are analytical constructs describing overalldirections the country could take over the next yearand are not mutually exclusive. Some would be mostlikely to develop from one of the others. We believethat the "deterioration short of anarchy" scenario,which develops out of current trends, is more likelythan any of the other three. There is, however, asignificant potential for dramatic departures along thelines of the "anarchy" or "military intervention"scenarios. Conditions are such that the odds stronglyfavor some form of these three "bad news" scenariosduring the coming year.

Deterioration Short of AnarchyCurrent trends in the country and the enormousproblems facing it in every sphere make this the mostlikely scenario over the next year, in our view. Intelli-gence Community analysts give this scenario a closeto.even probability. The economic, political, ethnic,and societal problems would continue to get worse atan accelerating rate. This scenario would be charac-terized by:• Failure to agree upon and implement effectively a

far-reaching marketization program; or the broadresistance of the population to such a course.

• Failure of the center and the republics to move tonew mutually acceptable political and economicrelations.

15

• Inability of political institutions to adapt to chang-ing political realities and ineffectiveness of newdemocratically elected leaders in governing.

However, a combination of the remaining powers ofthe old order—the party and government machineryand the security services—and the limited reforms theregime implements would prevent the entire systemfrom collapsing.

Some positive trends could also occur under thisscenario but would not be likely to develop sufficientlyto stem the country's rapidly declining fortunes dur-ing the next year. Gorbachev's ambivalence towardradical transformation of the system would end updelaying decisive action and diluting the effectivenessof steps his government takes. The hon-Communistforces both in and out of government would not beable to form coalitions on a nationwide scale to giveclear-cut direction. The complexities and social painassociated with putting a market reform plan in placewould not even begin to restore confidence in thecurrency, reverse autarkic trends, or revitalize com-merce, not to mention improve economic perfor-mance. The growing autonomy and self-confidence ofnon-Russians throughout the country would lead toescalating demands and make the achievement of avoluntary union much more complicated.

This diffusion of power would lead during the nextyear to an increasing power vacuum. With the accel-erating deterioration of central control and organiza-tional weaknesses of the opposition, more power wouldbe likely to move into the streets. Strikes and consum-er unrest would almost certainly grow, the more so themore rapidly the economy declines. Ethnic unrest andviolence would also increase. The security services andthe military would be able to manage as long asprotests remain scattered and uncootdinated.

The key determinant of how long this scenario wouldpersist is how long the economy can keep fromcollapsing under these conditions. The longer thisscenario prevailed, the greater the prospects would befor anarchy or military intervention.

Ccorot

The'DepartUre.O.Go'rbackev‘.0r

The impact of their sudden depaiturlfrdm t

,cUrred via assassinatiorttdiiiiki;iniiiiiiiit..:causes, or political presSisre.iwilh.lion undoubtedly being J(enos:destablliz1n.,iBut leaving aside the ctrolnisiandes.f.Wliellwould their absence meilig,. .Gorbachev's departure two years—or even one-Iyear—ago, while the traditionalists still re-gained considerable strength in the leadershipand the democratic reforms had barely begun tO.,;!get off the ground, probably would have setback those reforms maniyears. His demisethe next year would be certain to throw thecountry into flux. The CPSU has no obvioussuccessor who could wield the influence Gorba-chev has, and the presidency would not be asinfluential a post without such a strong leader.At the same time, traditionalists could see anopportunity to make a comeback. The demo-cratic and market reforms have now taken on alife of their own, however, beyond the control ofeven as formidable a figure as Gorbachev. Thetransformation of the Soviet system would takeplace in a more uncertain atmosphere in theimmediate aftermath of Gorbachev's departure,-.-but he is no longer "theindispensable man."

Yertsin has become the;littfOcial head of thet.... democratic reform movi:MIist, : and no one else"in:the: movement curretuetiis;11te stature to

- . .-challenge Gorbachev. Hii*PairtUreiOuldfiemajor setback to the iiiiitaiieiWOver.'-sille*•year -but probably not afatbi one over the

There aWftWiiiiRcti Oiekihg democratic

-.siri. 's .-rj)opular appeal bitiifaVe.oiker:iti:erieies.Ythat'aver time might ehagethetolilakii3!national role.

SerrAt

BEST CM

AWAKE

AnarchyAn accelerating deterioration is unlikely to continueindefinitely and could, during the next year, become afree fall that would result in a period of anarchy.Community analysts generally believe that the likeli-hood of this scenario is roughly I in 5 or less. Anarchywould be characterized by a breakdown of the eco-nomic system, collapse of central political authority,and widespread social upheaval.

Such an outcome could result from the interaction ofa number of developments. In fact, any one develop-ment could trigger a cascade that eventually leads toa collapse of the system:• A sharp acceleration of negative economic trends

already in evidence—local autarky, severe foodshortages this winter, numerous plant closings dueto lack of fuel and supplies.

• Massive social protests or labor strikes that provedto be beyond the security and armed services' abilityto control or resulted in large-scale civiliancasualties.

• The assassination of a key leader, such as Gorba-chev or Yel'tsin.

• The complete breakdown of relations between thecenter and the republics—particularly the RussianRepublic.

• The outbreak of sustained, widespread interethnicviolence—especially if directed against Russians.

There are several likely consequences of such ascenario:• Gorbachev would not politically survive such an

upheaval.• The potential for severe food shortages and malnu-

trition would be high.• The union would disintegrate. Most republics would

break away from the center, potentially setting offcivil wars and massive migrations.

• There probably would be various political outcomes(authoritarian, military dominated, democratic) indifferent regions of what is now the USSR.

Ccorot 16

Military InterventionCommunity analysts believe that the prospects formilitary intervention in politics are roughly the sameas those for "anarchy"-1 in 5 or less. BesidesGorbachev's apparent extreme reluctance to use mili-tary force to deal with the country's problems, mostSoviet leaders probably believe there is a strongdanger that military intervention could accelerate thetrend toward chaos and lead to the outbreak of virtualcivil war. Problems in society, moreover, have had adebilitating effect upon the military, making it in-creasingly less suitable and reliable for use in puttingdown social unrest or enforcing unpopular govern-ment directives.

Even so, under conditions of continuing deterioration,the likelihood of the military's becoming more in-volved in internal politics will grow as the leadershipbecomes more dependent on the Armed Forces andsecurity services to maintain control. The traditionalRussian desire for order could even foster a perceptionof the military among elements of the population asthe key to national salvation in a time of growingchaos. Many senior military leaders share this view ofthe Armed Forces as the conservator of the Sovietstate. The chances for military intervention wouldincrease markedly in a scenario where the countrywas on the verge of, or in. a state of anarchy.

Military intervention could take several forms: amilitary coup against the constitutional order, rogueactivity by individual commanders, oi martial lawordered by Gorbachev. Of these, Community analystsbelieve a coup—either the military acting alone or inconjunction with the security services and CPSUtraditionalists—to be the least likely variant. Such anattempt would have to overcome numerous obstacles,including the difficulty of secretly coordinating Theactivities of the many units required for a successfulputsch, the increasing political polarization of theArmed Forces, the military leadership's professionalinhibitions against such a drastic step, and the fear oflarge-scale resistance by Soviet society.

Only slightly more probable, in our view, would beindependent action by local military units in the faceof widespread violence that threatens or causes thecollapse of civil government. In such an event, a

17

military district commander—operating independent-ly of Moscow and possibly at the request of besiegedregional authorities—could order his forces to restorecontrol locally. Whether troops would obey underthese conditions would depend greatly on local cir-cumstances. Lacking clear direction and coordination,such independent military actions probably would notsucceed for very long, except perhaps in a situation ofcountrywide anarchy.

We believe that the most likely variant of militaryintervention would be one in which the central govern-ment in Moscow, believing it was losing all control ofevents and wanting to stabilize the situation, called onthe military to impose martial law in selected areasand enforce government directives in the name ofsalvaging reform. Such an effort probably would belimited to Russia and a few other key republics. TheHigh Command would try to execute such orders,seeing this as its duty to the state. lithe conditions aresevere enough, such military intervention might bewelcomed by the local population and could stabilizethe situation temporarily. Unless accompanied by aprogram offering solutions to the country's political,ethnic, and economic crises, however, the benefitsfrom such a step would be transitory and probablycounterproductive in the long run.

"Light at the End of the Tunnel"The prospects that progress toward the creation of anew system over the next year could outpace thebreakdown of the old are also about 1 in 5 or less, inour view. This scenario would develop out of currentpressure toward a pluralistic political system, self-determination, and marketization. Such trends, whilenot ending the societal turmoil, might gather suffi-cient steam to improve prospects for long-term socialstability. Economic hardship would increase as move-ment toward a market economy began and enormousdifficulties in creating a new politcal order would layahead, but a psychological corner would be turned togive the population some hope for a brighter future.

6ccrct

In order for this scenario to play out, there would haveto be substantial progress toward:

• Developing a new set of relationships that wouldallow the republics to deal constructively with eachother, the center, and the outside world.

• The filling of the political power vacuum by newpolitical institutions and parties. Key political lead-ers would need to work together constructively.

• Establishing new economic relations based on themarket.

• Changing the mood of the Soviet population fromone of fear of impending disaster to one of hope.Without such a change in the psychology of thepopulation, a successful transition to the market anddemocracy would be almost impossible.

The economy would also have to avoid a decline soprecipitous as to cause unmanageable social unrest.Progress toward market reform and republic autono-my will be difficult enough to achieve with the certaindropoff in economic performance. A dramaticallyshrinking economic pie would make unilateral stepsby the republics to assert their economic indepen-dence more likely. It would also increase the prospectsfor widespread consumer and labor unrest. If noteffectively managed, such developments could breakany government.

Implications for the United States

Whichever scenario prevails, the USSR during thenext year will remain an inward-looking, weakenedgiant with a declining ability to maintain its role asasuperpower. The domestic crisis will continue to pre-occupy any Soviet leaders and prompt them to seek, ata minimum, to avoid confrontation with the West. Butthe particular foreign policies they pursue could varysignificantly depending on the scenario.

Under the "deterioration short of collapse" or "lightat the end of the tunnel" scenarios, Moscow's West-ern orientation probably would be reflected in contin-ued, possibly greater, Soviet willingness to compro-

Scorct

mise on a range of international issues. The Sovietswould be very likely to continue:• Deepening the growing economic and political rela-

tionships with the United States, Western Europe,and, to a lesser extent, Japan.

• Negotiating ongoing and new arms controlagreements.

• Cooperating in crafting a new European securityorder.

• Reducing military and economic commitments inthe Third World and expanding cooperation withthe United States there.'

In these scenarios, Soviet as well as republic interestin Western economic involvement would continue toexpand rapidly. The liberalization of laws on jointventures, property ownership, and personal entrepen-eurship create improved conditions for Western in-vestment. However, uncertainties over prospects formarket reform, the role of the central versus therepublic governments in such areas as banking andforeign trade, and the ongoing turmoil in Sovietsociety will make significant investment a risky ven-ture for Western firms and make it unlikely thatmany will commit much to the effort.

The central and republic leaders also appear not tohave thought through what forms of Western aid orinvestment they would like, the scale of assistance, orthe timing. Proposals range from a "modern MarshallPlan," to Soviet inclusion in international financialorganizations, to technical assistance for marketiza-tion. The USSR faces serious structural and societalobstacles, however, that would dilute the impact ofmost forms of foreign aid except for technical assis-tance. Recent experience has shown that the country'stransportation and distribution networks are illequipped to move large quantities of imports efficient-ly. Wide-scale corruption and black-marketeering fur-ther diminish the system's capabilities to get goods totheir destinations. If Moscow moves decisively toward

These issues will be addressed more fully in the forthcoming NIEI I -4-9 I , Soviet National Security Strategy in the Post-Cold-WarEra

18

a market economy, Soviet leaders will press the Westand Japan even harder for assistance to cushion thetransition.

Internal political developments may also push Gorba-chev to conclude agreements with the West as quicklyas possible. Assertions of autonomy by republics inthe areas of economics and defense will increasinglychallenge his authority to speak on behalf of theUSSR. The diffusion of power is bringing new actorsto the scene who will attempt to develop their ownrelations with Western states, especially in the eco-nomic sphere. Special requests for consultations, tech-nical assistance, emergency aid, and trade from re-public governments are likely to increase. Unlesspolitical conflict over who owns resources and controlsforeign trade is resolved, both US governmental andprivate business relations with the USSR and itsrepublics will be complicated. Those direct Westerncontacts with the republics disapproved of by Moscowwould be perceived as interference and could result insteps by the central government to block Westernassistance to republics and localities.

An "anarchy" scenario would create precarious condi-tions for relations with the West and would presentthe United States with some difficult choices. Variousfactions would declare independence or claim legiti-macy as a central government and push for Westernrecognition and assistance—including military aid.Each Western government would be faced with thedilemma of which factions to deal with and support. Ifthe situation evolved into civil wars, the fighting couldspill over into neighboring countries. Eastern Europeand Western countries would be inundated with refu-gees, and there would be enormous uncertainties overwho was in control of the Soviet military's nuclearweapons.

Under conditions of anarchy, a coherent Soviet for-eign policy would be highly unlikely, and Sovietability to conclude ongoing arms control negotiations,implement accords already reached, and carry outtroop withdrawals from Eastern Europe would be

19

Elvtvae_.

undercut. Troop withdrawals from Germany, for ex-ample, could be delayed or stymied by transportdisruptions or by wholesale defections of Soviet troopseager to escape the turmoil awaiting them in theUSSR.

In a "military intervention" scenario, a military-dominated regime would take a less concessionaryapproach than Gorbachev's on foreign policy issuesand pursue a tougher line on arms control issuesbecause of the military's current misgivings aboutCFE, START, and the changes in Eastern Europe.Moreover, such a regime probably would divergesignificantly from current policy on Jewish emigrationand be less inclined to support the presence of USmilitary forces in the Persian Gulf region. Such policyshifts could undermine the entire panoply of Sovietpolitical, economic, and military ties to the West. Amilitary regime, however, would be too busy attempt-ing to hold the USSR together to resume a hostilemilitary posture toward the West, although furthershifts in resources away from the defense sector couldbe halted. Such a regime would be unable to restoreSoviet influence in Eastern Europe but would belikely to take a tougher line on economic issues andwould make East-West cooperaton in the region moredifficult.

21 —Sesr-et-

Socrct

Annex AEmerging Democratic Leaders

Vyacheslav Shostakovskiy

A member of the Coordinating Council of the Democratic Platform, Shostakovs-kiy advocates creating a post-Communist parliamentary party that will cooperatewith democratic forces both within and outside the CPSU. Shostakovslciy an-nounced at the 28th CPSU Congress in July that the Democratic Platform waswithdrawing from the CPSU to form a new party, and shortly thereafter was firedfrom his post as rector of the Moscow Higher Party School.

Anatoliy Sobchak

A legal scholar and radical reformer, Sobchak was elected chairman of theLeningrad city council in May. Sobchak may have first met Gorbachev in theearly 1960s, when he practiced law in the President's home region of Stavropol.Sobchak is an outspoken critic of Premier Ryzhkov and his ideas on economicreform. Sobchak, 53, resigned from the Communist Party in July. He is currentlycooperating with Yel'tsin, but policy and ego clashes probably will occur in thecoming year. Mk

Gavriil Popov

Popov, who resigned from the Communist Party in July, has long been one of theUSSR's most outspoken economists. Since becoming chairman of Moscow's citycouncil in April, he has energetically worked to implement radical market reformsin the city. Popov, 54, has been called shy but has also been accused of having anauthoritarian management style. As mayor, Popov has cooperated with Moscowparty boss Yuriy Prokoryev, a moderate reformer, and is a key adviser to Yel'tsin.

Nikolay Travkin

Traylcin is a radical reformer who favors immediate privatization of Soviet stateenterprises and rapid legalization of private property. A member of both theRSFSR and USSR Supreme Soviets, Travkin advises Yel'tsin. Travkin, who leftthe CPSU in March, was elected chairman of the Democratic Party of Russia atits founding conference in May (not to be confused with broader "DemocraticRussia" movement, of which Travkin is also a member). Travkin is 44. 41111.

• —Seer-et--

Annex BEmerging Traditionalist Leaders

Veniamin Yarin

Yarin has emerged as an energetic, popular, and effective right-wing leader withinthe USSR Supreme Soviet and now also sits on the Presidential Council.Influential among the working class and a self-avowed Russian nationalist, heopposes market-oriented reforms such as cooperatives and has called for pricefreezes on food and consumer goods. Yarin, 50, is cochairman of the UnitedRussian Workers Front, which opposes perestroyka as harmful to workers'interests. (Up

Ivan Polozkov

Polozkov is a moderate traditionalist who nonetheless supports some importantaspects of Gorbachev's reform program. Elected first secretary of the RussianRepublic Communist Party in June, he is an old acquaintance of Gorbachev fromtheir days as party officials in neighboring regions. Polozkov has been reviled bythe reformist intelligentsia and has been the object of an ongoing media diatribe.Polozkov, 55, has professed a desire to cooperate with Yel'tsin but has hadvirtually no influence over the program being put forward by Yel'tsin and theRussian Supreme Soviet. Conflicts between the two men are likely over the comingyear. Although his formal position appears to make him a major player, divisionswithin the new Russian Communist Party and the fact that the program of theparty's traditionalist majority is out of touch with trends in the country, arealready limiting his influence and relevance. dallo

23

C-4everse.