232. Paper Prepared in the Bureau of European Affairs, Department of State1
SUBJECT
- Uncertainties in Romania
Over the past several weeks we have seen further indications of a growing mood of uncertainty in Romania which reflects Ceausescu’s difficulty in coping with the country’s increasingly difficult economic and political problems and his concern that developments in Poland might find an echo in Romania.
There are signs that President Ceausescu is having an increasingly difficult time managing affairs in Romania. While he has demonstrated considerable skill in maneuvering Romania through difficult periods in the past, the current situation—domestic and international—presents particular problems for him. There are also reports from intelligence sources indicating that he may be suffering from slightly debilitating medical problems and/or, increasingly, the meglomania which is an outgrowth of his own cult of personality. In any event, it seems clear that Ceausescu’s erratic involvement in mid and low level personnel matters and economic planning decisions has become even more pronounced. As Soviet political pressures build over Poland, Ceausescu may also encounter difficulties in managing Romania’s foreign affairs.
Ceausescu’s reaction to the Polish crisis has been a mixture of predictable toughness and unusual conciliatory gestures. Although sharply critical of the Polish Party for not maintaining adequate control over developments, Ceausescu has repeatedly stressed his opposition to any outside intervention in Poland’s affairs. Addressing his domestic audience, Ceausescu has stressed the need for Romania’s workers to stay within the established party and trade union system when dealing with problems and raising grievances. While exhorting the workers to redouble their efforts to increase production and meet planned needs, Ceausescu has made clear that open dissent will not be tolerated, and worker slow-downs and stoppages since the beginning of the Polish strikes have been dealt with quickly, though apparently not harshly. In an unusual effort to suggest an atmosphere of responsiveness to the [Page 737] population’s needs, the Government has on two recent occasions sought comment from the general public on proposed legislation affecting housing and food distribution. In an analogous move, the official trade unions have published for comment the issues to be discussed at the quinquennial trade union conference early next year.
The future of Romania’s economy seems more uncertain than at any time in the last decade. Ceausescu’s goal of turning Romania into a developed country by 1985 is now clearly unattainable. Romania no longer has the raw material and manpower reserves which fueled the double digit growth rates of the past decade. In particular, Romania’s oil production is declining, and net oil imports, estimated at $1.2 billion in 1980, are an increasing drain on the economy.
Nevertheless, Ceausescu continues to emphasize investment and rapid growth. This policy only exacerbates Romania’s most serious problem, its growing balance of payments deficit, which was $1.7 billion in the first six months of 1980, more than the total deficit for all of 1979. Romania’s hard currency debt also jumped by more than $2 billion in the last six months.
Unable and unwilling to introduce real economic reforms, Ceausescu has resorted to shuffling personnel and tinkering with the economy. The 1981–85 Plan has undergone a series of revisions and has still not been approved. Measures supposedly aimed at decentralizing decision-making and creating worker incentives have had little impact—except to increase confusion and cyncism among workers and managers. At the same time, we have also seen evidence that the GOR is being forced to make shifts or cutbacks in some programs to save hard currency, reduce spending and be somewhat more responsive to consumer needs. These actions seem designed more to prevent a spread of the “Polish virus” to Romania than to serve a part of a coherent approach to Romania’s economic problems.
For the average Romanian, the effects are clear. A journalist-defector recently observed to us that shortages in the stores are unprecedented, even for a communist country. For the first time in Romania’s 2,000 year history, the country is no longer able to supply its population with one of its major staple food items, Romanian cheese. Our Embassy reports that given the low quantity of most food and consumer goods available and inadequate housing, it is safe to say that the standard of living of the average Romanian is in slow decline. (Romania presently stands only ahead of Albania in standard of living in Europe.)
The same defector told us that the mood of the Romanian intelligentsia is pessimistic. Those who have any awareness of events outside Romania see no hope for economic or political improvements in Romania as long as the Government maintains its over-exaggerated push for foreign trade and industrialization at the expense of the consumer [Page 738] sector. Consequently, increasing numbers of intellectuals and Government officials are considering getting out. This may help account for the recent rash of Romanian defections.
We have no hard evidence of increased Soviet pressure on Romania to change its position on Poland, and Romania has refrained from the kind of polemics manifested by the East Germans and Czechoslovaks. Pressure on Ceausescu is likely to mount considerably if the Soviets intend to intervene in Poland. Most curiously, we have seen two separate reports of statements Ceausescu allegedly made in private to the effect that were the situation in Romania as precarious as in Poland, he would be prepared to invite the Soviets in to stabilize the situation.
We should be more alert than usual when it comes to demonstrating our support for Romania’s independent position in the Warsaw Pact. Indications on any front of our support for Romania’s continued independent foreign policy course could be particularly important in helping it maintain its precarious political equilibrium in the coming months. Tangible evidence of U.S. interest in and support for Romania will be particularly important if the Soviets should intervene militarily in Poland and the Romanians should decline to participate in or endorse the intervention.
- Source: National Archives, RG 59, Counselor to the Department, Subject, Country Files and 1980 Briefing Books, Box 3, Pol 2—Romania. Confidential. Drafted by Becker and Bradtke, cleared by Bridges and Barry, approved by Holmes. The paper was prepared as part of the briefing material for Ridgway’s December 16 meeting with Bogdan.↩