49. Progress Report Submitted by the Operations Coordinating Board to the National Security Council 1


Policy Approved by the President December 23, 1953)

(Period Covered: May 1, 1954 through February 29, 1956)

A. Listing of Major Developments During the Period

1. During the period under review the following actions and categories of action were taken pursuant to NSC 174:

Presentation to the International Court of Justice of incidents of Soviet bloc attacks on U.S. aircraft.
Actions to obtain release of U.S. citizens imprisoned in the Soviet bloc.
Information programs exposing Soviet domination of the satellites.
Speeches and publications by people who have suffered under communist tyranny.
Offers of surplus U.S. agricultural commodities in cases of food shortages: Danube flood relief offer of July 29, 1954, which was accepted; and the offer to Albania on February 9, 1955, which was rejected.
Exploitation of indications of internal conflict within and among ruling groups.
Expressions of official U.S. interest in the future of Eastern Europe by the President, Secretary of State, and other senior U.S. officials.
Diplomatic actions in support of information activities of private American organizations, such as the Free Europe Committee.
Cultural and other contacts have been somewhat increased between the U.S. and the peoples of the Soviet European satellites.
Information programs have publicized evidences of growing Western strength including the U.S. contribution to the defensive military strength of the free world.
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B. Summary Statement of Operating Progress in Relation to Major NSC Objectives

2. Long-Range Objective—Independence. Eventual fulfillment of the right of the peoples of the Soviet satellites to enjoy governments of their own choosing, free of Soviet domination, is the long-range objective stated in NSC 174. There is no evidence of progress toward this long-range objective during the period under review. Nevertheless, this fact does not bring into question the validity of the objective.

3. Current Objectives. The current objectives cited first in NSC 174 are to disrupt the Soviet-satellite relationship, to minimize satellite contributions to Soviet power, and to deter aggression. Actions intended to disrupt the Soviet-satellite relationship may have caused some difficulties for Moscow, but no real evidence of a schism has yet made its appearance. Our actions, however, may have played a part in persuading the Soviet Union to moderate the extent to which its control and domination over the satellites are openly demonstrated. In varying ways in the different satellites, the USSR continues to show respect, within certain confines, for the power of local nationalisms. Despite the continuing success of Yugoslavia in maintaining its independent position which led to the Khrushchev-Bulganin visit in Belgrade last spring, no repercussions of the Yugoslav example are as yet apparent in the satellites. Although nationalist opposition continues to be a disruptive force in varying degrees in the separate satellites, it must still be concluded that a non-Soviet regime on the Tito model is unlikely to emerge in any of the satellites under existing circumstances.

4. Satellite Contributions to Soviet Power. There is some sign that U.S. policies and actions directed to minimize the satellite contributions to Soviet power have shown a measure of success. It is believed that the strategic controls on East-West trade have had an effect in limiting the satellite contribution to the Soviet bloc economy and war potential. These controls are regarded as a factor in retarding technological advance in the industry of the satellite areas to the extent that industry for the most part has been obliged to rely on equipment and processes which are becoming antiquated. The new communist domestic propaganda line stressing the need to learn technological know-how from the West bears witness to the unsatisfactory condition of satellite technology. U.S. psychological warfare programs are believed to be contributing to the continued passive resistance of the satellite populations which, through employee slowdown in industry and reduced effort in agriculture, has the effect of holding down the satellite contribution.

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5. Soviet Control and Popular Hostility. A further current objective in NSC 174 is to . . . promote conditions favorable to the eventual liberation of the satellite peoples. During the review period there have been signs in varying degrees throughout the satellite area of a change in regime approach, a greater flexibility of regime policy and ostensibly somewhat more open criticism of conditions. Whatever the varying degree in the appearance of liberalization in the satellite countries, there has been, however, no relaxation of real controls anywhere in the area. The totalitarian controls remain firm and effective, and none of the satellite regimes appears threatened. On the other hand, the regimes have not been able to overcome the separation between themselves and their peoples. In no satellite country has the regime anything approaching majority acceptance. As long as this alienation between people and regime is sustained, one of the basic prerequisites to eventual liberation remains at hand. While it is difficult to assess to what extent U.S. policy and actions can affect such a basic popular attitude, even though we were to attribute to them, at best, a minor role, we should not under-estimate the importance of United States efforts. The Voice of America, Radio Free Europe, the Crusade for Freedom and the other means of reaching the satellite peoples seem to have served both to keep alive in these peoples their sense of connection with the West and with Free World ideals, and also to sustain their alienation from the Communist regimes. At any rate, the continuing violent attacks of regime spokesmen and propaganda against these U.S. operations are an indication of their importance. Were they to be discontinued or diminished, the satellite regimes would be relieved of a major concern and become more confident in the eventual success of their efforts to subdue their own peoples and refashion them in the desired communist pattern.

6. Strengthening of Elements Favorable to U.S. Another NSC 174 objective is to conserve and strengthen the assets within the satellites, and among their nationals outside, which may contribute to United States interests in peace or war, and to the ultimate freedom of the satellites. Of major importance in this connection have been the several statements by the President and the Secretary of State affirming the U.S. intention not to undertake any agreement which would have the effect of confirming the status quo in the satellite area and expressing it to be the aim of U.S. policy that the satellite peoples should eventually obtain their independence and the right to determine freely their own form of government. Their effect was greatly enhanced by the violent reaction of the Soviet bloc authorities. While our efforts with respect to the peoples within the satellite area have been limited in means, primarily to such statements of policy and information operations, we are able to give direct support to the activities of their nationals outside the satellite area. During the review period we have [Page 124] conducted diverse programs to strengthen exile political activities and to resettle Eastern Europe refugees still living in camps or in temporary circumstances. A promising organization of the Eastern European political exiles has been developed during the review period, namely, the Assembly of Captive European Nations.

7. Review of Policy. On October 12, 1955, the OCB agreed to recommend to the National Security Council that the NSC Planning Board review NSC 174 and NSC 5505/12 in the light of and subsequent to revision of NSC 5501.3 In connection with the review of NSC 174 and NSC 5505/1, it is recommended that particular attention should be given to determining what further courses of action might be taken to induce the Soviet and satellite leadership to be more receptive to negotiated settlements and what degree of stress should be placed on encouragement of Titoist tendencies or “national Communist movements” as provided in NSC 174. NSC 56014 treats with Yugoslavia’s possible impact on satellite developments. NIE 12–56 (Jan. 10, 1956, paras. 27 and 28)5 contains an estimate of the importance of nationalist “deviation.” A continuing assessment will be required. It is recommended that particular attention be given to the individual countries in the satellite area in order to ascertain whether a general overall policy for the whole satellite area without discriminating among the several countries as set forth in NSC 174 is adequate or whether separate policies for each country, or a general policy with specific adaptations to the separate countries might not be more desirable.

C. Major Problems or Areas of Difficulty

8. The Geneva Conferences and the Satellite Issue. The West at the Geneva Conferences concentrated on the problem of German reunification as the major European problem for which settlement was to be sought. This had the effect of making the people in the Satellites feel that their future was being subordinated. The satellite issue was mentioned [Page 125] in the form of U.S. statements at the conferences and was raised informally with the Soviet leaders, but it was not possible to include it as an agenda item. It cannot be doubted that the inability of the West to press the satellite issue at either Conference has had an adverse effect on the satellite peoples. The admission of several satellites to UN membership recently seemed to affirm the status of the existing regimes and seemed to confirm the above feelings.

9. U.S. Policy for Germany and the Satellites. The intransigence of the Soviet policy at the Geneva Foreign Ministers meetings is assuredly in part related to the Soviet position with respect to the satellites. As long as the Soviets can keep the line of division in Germany and hold the satellites in the shadow behind that line, they will be gaining time for the consolidation of the Communist regimes in the satellite area. The Soviet position in Germany must be recognized as an advanced position with respect to Soviet control of the satellite area. It is a moot question whether the Soviets have any real expectation of communizing Germany or of maintaining their position in Eastern Germany in the long run. At the least, they may hope to achieve an eventual settlement which will afford some protection to their East German supporters and perhaps provide some form or modicum of neutralization. However, they may have an interest in postponing such an agreement so that the satellite countries will be as far advanced towards consolidation of the regimes and their popular acceptance as possible. They may also be expected to seek in connection with any settlement on Germany an international sanction of the status quo in Eastern Europe. The European security pact proposed by the West at Geneva, it may be noted in this regard, has been attacked by exile political leaders as sanctioning the status quo in Eastern Europe, which of course was not the case. Foregoing considerations (Paras. 8 and 9) should be borne in mind in connection with the formulation of U.S. strategy and policy with respect to Germany in order to ensure that possible effects on the attainment of our policy objectives with respect to Eastern European satellites continue to be considered in relation to our German policy.

10. The Time Factor. The outcome of the Geneva Conferences confirms the estimate that a considerable span of time will be required to attain the loosening of Soviet control in the satellite area and the accomplishment of U.S. objectives, either long-range or current. The sheer passage of time involves certain difficulties with respect to the implementation of NSC 174. It is likely to become more and more difficult to keep hope of liberation alive in the satellite peoples. The strength and determination of the political refugees are apt to decline; the older generation of political exiles will die off, and the young refugees are likely to become so absorbed by their new environments that they will cease to take an active interest in the affairs of their [Page 126] home countries. Moreover, the passage of time in itself tends to confirm the status quo. Continued diplomatic recognition, possible limited government agreements (on property questions), admission of all the satellites to United Nations membership, increased trade, cultural exchanges, visits of Congressmen, American tourist travel will all tend to signify normalization of relations and an implied acquiescence in the Communist puppet regimes. It must be regarded as a major problem in the implementation of NSC 174 that any movement toward a relaxation of tensions between East and West is bound to be widely interpreted in the satellites as a weakening of Western determination to achieve their liberation from Soviet control and a disposition to accept their status as permanent.

11. Conflicting Approaches. U.S. capabilities directly to influence developments within the satellites, particularly for the development of organized resistance which could basically alter the status of the satellites, remain limited. Moreover, implementation of the Outline Plan, approved by the OCB on September 21, 1955,6 will be affected considerably by the shifting climate of the international situation. In the absence of a cold war climate, many of the courses of action would be difficult to pursue. For example, those intended to encourage anti-communist activities and passive resistance are somewhat incompatible with a détente. Likewise, efforts to bring about a basis for a negotiated settlement and to encourage evolutionary changes in satellite regimes, as proposed for existing policy (particularly under NSC 5505/1), are not always compatible with programs intended to keep alive the hopes and aspirations of the captive peoples. A re-examination of NSC 174 and NSC 5505/1 may offer some guidance as to the resolution in practice of such incompatible policies. It may be that the U.S. will have to undertake to follow simultaneously two policies with inconsistent courses of action, representing divergent approaches to the one objective.

12. East-West Contacts. Efforts at the Geneva Conference of Foreign Ministers to obtain agreement with the Soviets on a broad range of increased contacts involving a freer exchange of ideas, information, and news as well as freer travel and cultural exchange met with no success. Nevertheless, the Soviets continue to evince interest in a restricted increase in contacts and cultural exchange. There is some indication that a corresponding relaxation, albeit of lesser dimension, is likewise desired by the satellite regimes. While the United States desires to increase contacts on a selective basis and in a wide variety of fields with the peoples of the Soviet bloc, the objective of the Soviet and satellite regimes appears to be to permit only a restricted number [Page 127] of carefully controlled contacts, especially between official delegations, to exploit Western freedoms in order to obtain scientific and technological information, and to give the appearance of raising the iron curtain without actually doing so. Although there appears little likelihood of any striking success in opening breaches in the iron curtain soon, plans contemplate our continuing to press suitable opportunities in this field, making available to the world press continued examples of satellite fearfulness to permit their peoples contact with the West.

13. Trade with the Bloc. As tensions have appeared to diminish, groups in the West have increased their demands for freer trade with the bloc. Although restrictions have been removed on certain commodities, pressures may continue to reduce much further the range of goods now considered strategic. In recent months several satellites have indicated their interest in resuming more active trade relations with the U.S. In Czechoslovakia we have undertaken to discuss this question in a comprehensive negotiation on outstanding economic issues, e.g., U.S. claims for nationalized property and other Czech financial obligations. In Hungary we offered to discuss the question of trade in the context of a broad examination of mutual problem areas. Negotiation of trade matters with these countries presents difficulties, not only because of our refusal to discuss controls on strategic trade but also because of our lack of flexibility with respect to hindrances to non-strategic trade, such as the denial of tariff concessions to Soviet bloc countries as required by the Trade Agreement Extension of 19517 and restrictions on trading in agricultural commodities which result from provisions of PL 480.8

14. Uncertainty of U.K. and French Policies. During the past year, and particularly in connection with the tripartite preparation for the Geneva Summit meeting, it became apparent that the British and French Governments did not share our strong convictions on the satellite question. They were anxious that the satellite issue not be raised or pressed at the Summit meeting, fearing that it might become an obstacle to progress in negotiations on other subjects. While there is no clear evidence that they would be as yet prepared to make any agreement which would have the effect of sanctioning the Communist regimes in the satellites, nevertheless they are not inclined to make positive statements, such as we have, indicating a firm position on the satellites. The U.S. is considering at this time approaching both the British and French Governments in order to seek acceptance on their parts of a position with respect to the satellites that is closer to the U.S. position [Page 128] and which would be reflected in their policy towards the satellites and their public statements. It would be particularly germane to take this up with the British prior to the Bulganin-Khrushchev visit to England.

  1. Source: Department of State, S/P–NSC Files: Lot 61 D 167, Soviet Satellites in Eastern Europe. Top Secret. According to a covering memorandum from Staats to Lay, March 6, this progress report was concurred in by the OCB on February 29 for transmittal to the NSC. In a memorandum from Beam to Hoover, February 24, summarizing a draft of the progress report, Beam stated that it was “an agreed report” and noted that there were “no important differences of opinion among the agencies expressed either in the Working Group or the Board of Assistants.” (Ibid., OCB Files: Lot 62 D 430, Soviet Satellites 1956)
  2. The Planning Coordinating Group prepared a progress report dated December 14, 1955, on NSC 5505/1, “Exploitation of Soviet and European Satellite Vulnerabilities,” which it did not approve but merely forwarded without comment to the Chairman of the OCB. As noted in the summary of the progress report on 5505/1, the emphasis of that paper was placed upon inducing evolutionary changes in the Soviet Union. Actions taken to exploit satellite vulnerabilities were reported on separately in this progress report on NSC 174. The progress report on NSC 5505/1, December 14, is ibid., S/P–NSC Files: Lot 62 D 1, Soviet Vulnerabilities. For documentation on revisions of NSC 5505/1, see vol. XXIV, pp. 3 ff.
  3. For documentation on revisions of NSC 5501, “Basic National Security Policy,” January 6, 1955, see vol. XIX, pp. 24 ff.
  4. NSC 5601, “U.S. Policy Toward Yugoslavia,” January 9, 1956, is scheduled for publication in volume XXVI.
  5. For an extract of NIE 12–56, see Document 45. Paragraphs 27 and 28 are not printed.
  6. Not printed. (Department of State, OCB Files: Lot 61 D 385, USSR and Satellites, 1953–56)
  7. PL. 50 (65 Stat. 72), approved June 15, 1951.
  8. Agricultural Trade Development and Assistance Act of 1954 (68 Stat. 454), approved July 10, 1954.