173. Despatch From the Embassy in Poland to the Department of State 1

No. 179


  • Embassy Despatch 175, Nov. 6, 19562


  • Polish Economic Situation: The Issue of U.S. Assistance

In our effort to assist in the consideration of Polish problems in Washington it is deemed advisable to present in semi-outline form the Embassy’s concept of the current Polish economic situation.

I. Atmosphere and Circumstances:

As the Embassy has previously reported in its discussions of the Poznan riots that took place in June of this year, and as the Embassy noted repeatedly prior and during the changes that resulted in the coming into power of Mr. Gomulka, the economic difficulties and pressures existing in this country have had an important effect on its political, governmental and international relations. The Embassy’s priority telegram 540 of October 26 enumerated nine specific areas of economic problems.3 Previous despatches which are of particular significance in this connection are:4

“Housing Situation”, No. 107, Sept. 5

“Unemployment”, No. 83, Aug. 22

“Continuing High Prices”, No. 108, Sept. 5

“Poor Condition of Handicraft Industries”, No. 95, Aug. 28

“Tight Foreign Trade”, No. 172, Nov. 6

The Embassy’s telegram 562 of October 295 presented in six numbered points important aspects of the economic-political situation of which this despatch is an extension.

The offers of US economic assistance in recent months were confined to offers of agricultural products. In January–February 1956 there was an offer of wheat.6 Through the International Red Cross, in June 1956, after the Poznan riots, there was another offer of food.7 Corollary [Page 407] questions which arose in discussion and exchange of correspondence with the Polish government regarding these two offers involved the following points: the unwillingness of the Polish government to accept the foodstuffs as a gift; their rejoinder proposal that opportunities be given for Poland to purchase US agricultural products at world competitive prices; the additional or inferred desire on the part of the Polish government for credits to finance agricultural purchases. Additional points which similarly have not been clearly resolved in this matter are: (a) the availability of export licenses for such goods and (b) the fact that other sources of supply, such as Canada, are open to the Poles. It is presumed that the Poles have canvassed other sources to obtain the most favorable price and credit conditions possible.

The Department will recall that in response to the American invitation to Poland to send observers to the US electoral campaign a reply was received in the form of a note dated October 8, 1956 (Embtel 406)8 in which a counter offer was made to discuss other problems of mutual interest to the two countries. No reply has been made to the October 8 Polish note. The importance attached to this offer by the Polish government is underscored in its press treatment (Embtels 614 and 616) of the recent exchange of tentative views on the need or desire of Poland for economic assistance.9 Negotiations leading towards a solution of all pending US-Polish problems is not the object or scope of this despatch. Many issues, on either side, would undoubtedly be brought up during such a comprehensive negotiation.

The interests of other countries that might be affected by changes in US-Polish economic relations would include, among others, the Soviet Union, which for the past twelve years has had extremely close economic ties with Poland. The role of Poland with its associates in the CEMA group10 and its ability to continue active participation with the Soviet satellites’ economic interchange and interdependence would require re-examination. The interests of the British, Dutch, Belgian, French and other Western nations in assisting Poland by government action or in substantially increasing profitable trade through commercial channels will require serious consideration and may call for joint policies to be established by the respective governments.

The attitude which Poland assumes towards Yugoslavia and Hungary may also have a decisive influence. It is too soon to estimate the extent to which the Gomulka regime in Poland will become parallel domestically, ideologically and internationally to the Tito regime in [Page 408] Yugoslavia. The Polish government has thus far followed a doubtful, changing and ambiguous attitude in its relationship to Hungarian developments. Its vote in the United Nations to support the Soviet stand regarding Hungary11 is a sign that Polish actions in this sphere are more meaningful to the US than are the ambiguous press articles and statements made here by the government’s leaders.

II. Considerations that should be Weighed:

Whatever the decision or series of decisions, their phasing and timing is of importance.
The same holds true with respect to publicity. This will require a careful balancing of advantages and disadvantages. (The Poles unilaterally published news of this topic (Embtels 609, 613)12 to exert a calming influence at a time of tension in Warsaw over the Hungarian crisis.
Equally important is the matter of quid pro quo. There are many items that could be listed as highly desirable for the US government or for its citizens, to get from Poland.
Ideological considerations enter strongly into what the US government can do, for they shape American public opinion, the willingness of Congress to appropriate funds, and the flexibility and extent of action that can be taken by the Executive Branch.
The American public has long been thinking about the need to offer food, financial and economic help, even military aid, as well as technical assistance, to under-developed countries, or to regimes threatened by a Communist menace. Varieties of this ideology have been the basis for Marshall Plan aid, Greek-Turkish aid, the International Cooperation Administration, the Mutual Assistance Program, MAAG, and others. But it is only the Yugoslav example that we have on the other side, i.e., giving aid to bolster up and strengthen a Communist regime. The Yugoslav precedent is not analogous to the Polish situation. For the Gomulka regime reiterates again and again its membership in the Warsaw Pact (Yugoslavia is not) and within the past weeks has repeatedly and forcefully gone on record as favoring the Soviet alliance, Polish-Soviet friendship. Poland voted with the USSR on the Hungarian issue; Yugoslavia did not. Tito made a greater break with Stalin, eight years ago, than Gomulka does today. The US did not help a Yugoslavia with Russian troops in control of the country.
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III. Arguments Against Aid to a Polish Communist Regime:

The Communist Gomulka Polish regime is a party to the Warsaw Pact, which is directed against NATO and the United States and other basic political, diplomatic and defense policies of the USA. There is a possibility that the Warsaw Pact may be changed. When and if it is changed, this argument can be re-examined. For the present, Poland, by virtue of its geographic position, if nothing else, is almost certain to remain a member of the Pact or some similar Bloc defense arrangement as long as NATO exists. It is equally certain that Soviet troops in one guise or another will continue to be stationed in Poland at least as long as Soviets remain in East Germany. The Gomulka regime has admitted and even defended this position during the past week. As a member of Bloc defense the foreign policy of Poland continues by definition to be inimical to the best interests of the United States and the West. The withdrawal of Soviet troops from Poland and formal withdrawal from the Warsaw Pact and other Bloc defenses would surely be a very definite indication of Polish independence; it is submitted that the Gomulka regime has thus far demonstrated no willingness whatsoever to take either of these major steps. It may be well argued that Gomulka couldn’t even do so if he wanted to.
Any added strength that Gomulka obtains can be channeled by Gomulka in such a way that the same amount of strength, economic aid, credit, or trade at his discretion may be devoted to Communist purposes. Those purposes might be to enter the commercial markets of the Middle East, India, or Iran. Those purposes might be to infiltrate and subvert Cambodia, Burma, or Indonesia. Those purposes might be to furnish ships, arms, guns to Egypt, to Algiers, to Morocco, or to other areas thereby causing dissent or disruption in the relationships between those areas and the US, or the British, Dutch, and French. By the same token, we might be working against our own policies with Western Germany and its reunification by strengthening Gomulka in his position. If there are controversial issues such as Western Territories, armaments, or trade policies between Germany and Poland, we do not want to grant aid so that Gomulka can get strength from us with which to oppose Germany.
Military considerations. Why should the US aid the economy of a country that is occupied by Russian troops? There would be no inducement for the troops to leave. More and more bases for tanks, infantry, aircraft, and naval power could be built up and strengthened in locations strategically close to Berlin, London, Paris and Brussels. While these military build-ups continued, the US would, in effect, be subsidizing them, building them up, feeding the people who worked on those military installations. We would be, militarily speaking, working against ourselves and against our NATO allies. Indeed, it is [Page 410] our thought that it was the recent deterioration of economic conditions within Poland which gave rise to the pressures that produced Poznan riots and the subsequent developments away from Soviet control. These tendencies are in keeping with US basic policies towards the satellites; we should do nothing to slow down those tendencies, or to reduce their effects. Poland helped North Korea in the war, taxing her economy to do so. That caused a direct loss of American lives and treasure. Now, should we subsidize and bolster Poland after its strong effort to defeat us?
After 12 years of Communism in Poland, there is a failure, evidenced in all fields, agriculture, mining, industry, housing, police state, Parliament, free speech and movement of people, etc. Workers are underpaid, production is low, a minimum standard of living for a European people is the result in a country where, prior to Communism, the agriculture of the country not only fed the people but allowed surplus to be exported. This unrest exploded at the Poznan riots; it was fully documented in terms of human misery, neglected youth, low standard of living, hatred of police state, brutalities, harshness and secrecy of the Communist way of life, at the Poznan trials. This is the result of the Communist system. Another Communist leader, Gomulka, is now to carry on. Why should we use our talents and our funds to turn into a Communist success what is a Communist failure?
The success of Communism. Any aid and strength given to Gomulka will enable him to meet his dilemmas: to add to consumers goods rather than heavy industry; to speed up or slow down agricultural collectivization; to skim off such economic help or trade subsidies as he wishes in order to work out his policies with East Germany, USSR, satellites, China, Middle or Far East. The resolution of his existing dilemmas would leave him free to devote his energies to other Communist purposes, and we can be sure that none of them bode well for the USA. Is it to the benefit of the US national interest to extricate Gomulka from these Communist difficulties?
It is one of the objectives of US policy to drive a wedge between the USSR and the satellites. As the Polish economy has been all but completely integrated into that of the USSR and the satellite bloc, it would require enormous funds, supplies, goods, technicians, expenditures, time, and cooperation to pry Poland economically away and start her on a fresh path, at US initiative and cost. It does not require US aid to do this. It has been started here already by Polish leadership with the “own road to Socialism” and “equality and independence” slogans of Gomulka. What the Poles have done within the past few weeks has been to our advantage. It was done by themselves. US aid might hinder or deter this process by relieving the pressures that have produced these changes. If Gomulka is unable to give wage raises or to [Page 411] increase standards of living, the pressures might increase against a domestic Communist state that fails to give the people what they need and want, as they have previously arisen against a Soviet-dominated regime that did not satisfy the Poles.
Probably no further initiative need be taken by the United States. Any request for assistance, aid, credits, or improved trade relationships should come from the Poles. This would clarify a number of points in Gomulka’s relations with the Kremlin that might otherwise remain doubtful.
The Department will undoubtedly take steps so that it does not find itself in a position of defending a Communist regime. For if developments go further in Yugoslavia, or elsewhere, than in Poland, then the “support” of Gomulka-ism by the US may serve as an obstacle to greater changes elsewhere, or in Poland itself. Gomulka policy statements, to date, reiterate the alliance with the USSR; Plenum resolutions are replete with working class dictatorship plans and phraseology.
Opportunity may be presented to exploit the Soviet policies fastened upon Poland: retention of its Army, making of Gomulka’s claim to independence a hollow boast, unfair trade conditions under which Poland continues to deal with the USSR.
It is the understanding of the Embassy that in the current Rumanian-United States negotiations,13 there are on the agenda such questions as payments for war damage to US property, reimbursement for US properties nationalized by the Rumanian government, the introduction of American newspaper and publications into Rumania, and the granting of permission for American citizens (dual nationals) to return to the United States. As is stated in Section II, C, above, and in the second paragraph of page 2, above, many issues on either side could be brought up during a comprehensive across-the-board negotiation between Poland and the United States, and various items for quid pro quo could be furnished by the Embassy to the Department. Whilst there is no overriding consideration known to this Embassy to indicate that Rumania and Poland should be treated in a similar fashion, the question of parallel or diverse treatment of these two satellite countries will doubtless be a matter for policy consideration by the Department.
Recent developments in Poland which have been observed and reported to the Department by the Embassy include the release of the Cardinal,14 the ousting of Marshal Rokossovsky from membership in the Politburo (he is now “on leave” from his post as Minister of Defense), and the return to the USSR of some 32 Army officers. Other [Page 412] developments, such as the public emphasis of the Polish government and by the Communist Party leadership on the Polish-Soviet alliance, and the retention of large Soviet military forces on Polish soil, have also been reported. If the Poles themselves, on their own initiative, continue to advance towards independence and rid themselves of other elements of Soviet control, the objectives of American foreign policy will be achieved without any US aid or assistance programs. When and if this tendency stops, and an additional force is judged necessary in order to continue or to revitalize it, would be the time to consider whether changes in American economic policy towards Poland would be justified in order to further our political and diplomatic objectives. A positive and constructive aspect of this line of action would be to show not merely to Poland, but also to the other satellites, that if steps are taken to establish their true autonomy and independence, they can look forward to sympathetic consideration of economic requests from the United States.

In the Embassy’s confidential telegram No. 493 of October 2215 it was stated that the Embassy is sufficiently suspicious of the Soviet and Polish Communists to continue to watch for evidence to support the thesis16 that the October crisis in Poland was planned by the Soviets to make the puppet regime more palatable to the satellite population, and possibly to lure Western aid to relieve the Soviets of the full responsibility for the low standard of living. The basis for the suspicion is that the Soviets probably did not let the Poles “do what comes naturally”, but planned and created the crisis; at any moment the movement could have been nipped in the bud by the liquidation of Gomulka (indeed a Western Chief of diplomatic mission has been informed that Gomulka is being used as a temporary stalking horse for Soviet forces), and by the fact that the events transpiring in Poland were in a way predicted by the 20th Congress of the CPSU. In view of this suspicion, and the lack of conclusive evidence of the extent, if any, to which Gomulka intends to truly break off from the Soviets, it appears highly advisable to watch developments carefully before making commitments as to US policy. If the Gomulka regime should totter and fall, due to incompetence of leadership, due to its being upset by more openly pro-Soviet forces, or due to Communism’s inherent evils for the community, the US should not be placed in a posture of having economically supported and maintained that regime.

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It is fully realized that the National Security Council has adopted policy statements regarding assistance to countries that may break away from the USSR’s control. The evidence does not show that Poland has done so, to any extent.


Without prejudice to the question of whether the US is willing or able to give Poland substantial aid, aid in such quantity over a long period of time and of such a type that will really contribute significantly to a stronger economic position for the Polish regime, it is likely that as a psychological warfare initiative, Washington will want to incline towards being “cautiously positive” on the subject of aid. This approach is related to the NSC decision to promote “peaceful evolution” of the situation in Eastern Europe.17 It is highly doubtful that the US will favor a policy of “more catastrophes à la Hungary the better”. For the trouble with such a policy is that it leaves Russia, bloody-handed though it may be, in possession of the field, to a greater extent than it is in Poland today.

For the present, therefore, it appears advisable to defer consideration of large-scale, long-continuing substantial aid, which could be captured and used for their own purposes by the Communists. A smaller, symbolic program of private organizational aid may be deemed adequate to meet the demands of the situation, as is pointed out in Part IV below.

There is no commitment, moral, legal or otherwise, to undertake an “aid program” for Poland. The basis on which the Embassy approached the Polish Foreign Office in keeping with the Department’s instructions, was the President’s earlier address regarding helping freedom-loving peoples.18 The evidence that Poland has a freedom-loving government is far from persuasive, especially in the light of Poland’s vote in the United Nations on the Soviet side of the Hungarian question, and in view of the recently stated reliance of Poland upon the Soviet alliance. If Poland does not show by her future actions that she has become “freedom-loving” the sine qua non for economic assistance has not been supplied. Furthermore, the position of the Polish government, stated by the Foreign Office orally to the American Ambassador, and published in the Polish press on November 419 places the major emphasis not on “aid programs” but on restriction-free trade relations, with the possibility of credits. As the question of free trade relations would involve such legislative legislation as the “Battle Act”,20 and such administrative questions as the [Page 414] enforcement and continuance of the policies of the International Coordinating Committee, “COCOM”, apparatus, it is by no means clear that the Polish emphasis is reciprocated by the United States. There may be much more ground for divergence than for concurrence of policies between the two governments in this sphere.

IV. Help the Polish People.

This, if decided upon as advantageous to the US to do, could be accomplished in a variety of ways. In this process, the interest and assistance of US citizens of Polish extraction can be given an entirely satisfactory outlet. There can be stepped-up gift package programs, through PKO, Red Cross, Jewish, Catholic, and Protestant religious organizations; loans, gifts, or shipments to churches, to societies, or to individuals. These could be accompanied by letters, publicity, and personal messages. Adverse action by the Gomulka regime could quickly put a stop to such gifts. Quid pro quos could be introduced into the program, covering religious, cultural, and press freedoms and cooperation. Any prestige deriving from this activity would accrue to non-Communist organizations rather than to a Communist regime.

The Polish nation is very largely Catholic. The freeing of the Cardinal from house arrest has made a considerable impact upon the public. The channeling of either privately donated aid, or of United States government food surpluses through the nation-wide outlets organization of the Catholic church would probably place in the hands of the needy those items and products which have small strategic value, and would give the Communist Gomulka regime the minimum of prestige.

An increased exchange of persons, official and unofficial, covering various fields of activity, conceivably would meet the double requirements of American and Polish government policy. The Polish Foreign Office, in its note of October 8, and in the conversation with the Ambassador on October 25,21 made this suggestion. It is a policy that has received the approval of the United States government. In its implementation, such a program could contribute much to the influencing of Polish citizens with a durable pro-US effect; it would offer an opportunity to private individuals and organizations in the US that have Polish connections and sympathies to act; it would not contribute quickly or substantially to an increase in Poland’s military or strategic potential. There already exist agencies of the American government [Page 415] that are equipped and ready to put such a program into execution, including the Department of Agriculture, the United States Information Service, and others.

V. International Action.

If action to give economic assistance to Poland is taken by other countries, acting separately, or jointly, a considerable amount of discussion and collaboration would probably be advantageous. There are forums and organizations for this: the UN, the World Bank, the new International Development Agency, the International Red Cross, the Economic Commission of Europe, the European Coal and Steel Community, and the Organization for European Economic Cooperation. In determining the US attitude towards such international action, the factors and considerations mentioned above could be taken into account before reaching policy determinations.

Willard F. Barber
Counselor of Embassy

Comment by the Ambassador:

The foregoing is a compilation of thoughts and ideas of various members of the staff at Warsaw on the subject of possible aid to Poland. It represents an expansion of detailed discussion of various basic ideas and suggestions already submitted to the Department as the six points in Embassy telegram No. 562 of Oct. 29, 1956, and the nine points in Embassy telegram 540 of Oct. 26, as well as what we call the “shopping list” contained in Embassy despatch No. 175 of Nov. 6. This despatch should, therefore, be considered in that sense and not as a recommendation for or against aid to Poland.

As regards the desirability of extending aid to Poland, there is a divergence of views even among members of my staff and between them and myself as there likewise must be a divergence of views in Washington. The difference is not so much, however, on the question of whether aid should or should not be extended but rather a difference of opinion as to what aid should be given, how it should be given, and when it should be given. A decision on these points depends upon careful consideration by Washington level authorities of the multiple factors covered in this despatch and a decision or decisions thereon at appropriate times.

Substantially, my own views as of the present moment are as follows:

There is in Poland no catastrophic situation such as exists now in Hungary or might exist if there were a great shortage of foodstuffs which required what might be called the humanitarian type of emergency aid.
Until the Polish Government gives us a more suitable reply than a press release to our aid approach of October 25, we are somewhat stopped from making further offers of aid or assistance to Poland unless we want to make ourselves look somewhat ridiculous along the lines of the song, “Please, oh please take my money”, from “Call Me Madam”.
Assuming the Polish Government responds to our approach of October 25, 1956, and we agree to enter into discussions, I am afraid that, if the response is along lines indicated by Mr. Winiewicz on Oct. 25, those discussions may be long drawn out. It is difficult for me at the present time to see how we can acquiesce in Mr. Winiewicz’s “trade not aid” formula with respect to a wide range of commodities, without strengthening and enhancing the prestige of the Polish regime which is still closely allied with the Soviet Union.
Notwithstanding the above, I believe there is still an area in which we could extend aid and assistance which would benefit the Polish people and not too greatly add to the prestige of the regime. This field lies in the realm of exchanges of persons and some assistance largely in the agricultural and scientific fields. Such items will be found in the “shopping list” contained in Embassy despatch 175. In general, they relate to exchanges of agricultural students and technicians, the possible supply, on credit terms, of fertilizer and feed grains. Aid of this kind could be handled in such a way as to give maximum publicity in Poland so that the Polish people would know where the aid is coming from and the results would benefit, first, the Polish farmer and, second, the Polish people in general by increased production in foodstuffs.

J. E. Jacobs
  1. Source: Department of State, Central Files, 848.00/11–656. Confidential.
  2. Despatch 175 transmitted a list of commodities which the Poles might request if U.S. economic assistance were provided. (Ibid.)
  3. Not printed. (Ibid., 748.00/10–2656)
  4. None of the despatches listed is printed.
  5. Not printed. (Department of State, Central Files, 611.48/10–2956)
  6. See footnote 2, Document 68.
  7. Documentation on this subject is in Department of State, Central File 848.49.
  8. See footnote 2, Document 92.
  9. Reference is to a Polish Press Agency release of midnight November 3 regarding the U.S. economic aid approach. Telegram 614 transmitted the Embassy’s translation; telegram 616 was an analysis. (Both ibid., 748.5–MSP/11–456)
  10. The Council for Mutual Economic Assistance, established in 1949, bound the Soviet Union and its satellites economically.
  11. Reference is to Resolution 1004 (ES–II).
  12. Neither printed. (Department of State, Central Files, 848.00/11–356 and 748.5–MSP/11–456, respectively)
  13. See Document 139.
  14. Stefan Cardinal Wyszynski was released from house arrest on October 28.
  15. Telegram 493 presented alternative interpretations of developments in Poland. (Department of State, Central Files, 748.00/10–2256)
  16. This thesis is not accepted by the Embassy, but evidence to support it will be reported, when and if found. [Footnote in the source text.]
  17. Apparent reference to NSC 5608/1, Document 80.
  18. See Document 99.
  19. See footnote 8 above.
  20. For text of this act, named after Representative Laurie C. Battle of Alabama and known as the Mutual Defense Assistance Control Act (P.L. 213, approved on October 26, 1951), see 65 Stat. 644. It called for the termination of all U.S. economic, financial, and military assistance to any country trading embargoed items to the Soviet Union and its satellites.
  21. Regarding the Polish note, see footnote 2, Document 92. Regarding the Ambassador’s conversation, see Documents 109 and 110.