Foreign Relations of the United States, 1981–1988, Volume X, Eastern Europe

255. Intelligence Research Report¹

No. 185

Washington, October 6, 1988

(C) Yugoslavia: Whither the Federation?²

Key Judgments

Since May, three separate challenges have begun to test the resilience of the Yugoslav system. Individually or collectively, each could force far-reaching change. What course this change will take is difficult to predict because the pressures act in opposite directions:

— The most dangerous challenge, resurgent Serb nationalism, is rapidly evolving into a mass nationalist movement with protest rallies increasing in frequency and size—the largest to date numbered 300,000. Led by the Serb party, the movement seeks creation of a strong, unified Serbia and ultimately, some suspect, a Yugoslavia under Serb domination. It is openly challenging the authority of the federal leadership, threatening cooperative Serb ties with other major ethnic groups, and increasing the potential for ethnic violence between Slavs and Albanians in and around Kosovo.

— The republic of Slovenia and the Yugoslav military remain locked in a confrontation over the scope and pace of liberalization; both sides are looking for a face-saving way out of their current test of political wills. But relations could yet deteriorate, precipitating mass demonstrations which the military might see as justification for wider involvement in Slovenia.

— Recent marches by workers on Belgrade and republic capitals have spilled over into the political arena with demands that incompetent leaders be removed and social reform implemented. A more serious wave of workers’ marches this fall could lead authorities to bail out insolvent enterprises and sidestep proposed market-oriented economic amendments to the Constitution in November. Implementation of reforms would be delayed and the International Monetary Fund forced to scale back performance targets in its recently adopted standby agreement. Belgrade ultimately could be forced to seek a renegotiation of the latest IMF agreement.

The current problems are the most serious of the post-Tito era. The Titoist system is not likely to collapse, but far-reaching changes are possible in the next two months. Weathering them could pose a serious test to stability.

* * *

Systemic Challenges

Pressures for political change in Yugoslavia have been mounting since Tito’s death in 1980. But since May of this year, three distinct systemic challenges have emerged—a nascent Serb nationalist mass movement, a Slovene-military confrontation over the scope and pace of political liberalization, and workers’ demands for removal of leaders responsible for enforcing much-needed austerity measures.

Each of the three challenges is new on the postwar Yugoslav political scene—they are related only to the extent that they intensify pressures for changing the Titoist system. Their final resolution, however, could precipitate a significant shakeup of the party and state leadership, which in turn could force far-reaching systemic change. At a minimum, each of the three challenges will profoundly affect the constitutional amendment process currently under way. Again, depending on their final resolution, each has the potential to reduce prospects for much-needed reforms, as competing regional leaderships struggle to modify what they perceive as the more extreme positions of their rivals.

Thus far federal authorities have managed demonstrations and protest marches by disgruntled ethnic groups and workers fairly effectively, combining tough negotiating skills with a show of sensitivity for popular feelings. But given the frayed Yugoslav political fabric, one misstep could significantly increase the potential for heightened ethnic and regional tensions—and violence.

Yugoslavia: Areas in which a Nationality Composes the Majority of the Population

1. Serb Nationalism

A mass movement. The dramatic resurgence of Serb nationalism is rapidly evolving into a political movement—the most serious, and as yet unmanageable, challenge currently confronting the Yugoslav regime. Serb republic leaders are bent on protecting the ethnic and civil rights of minority Serbs in the republic’s autonomous province of Kosovo; to do so, they are attempting to amend the republic’s constitution to give Serbia greater control over the judicial, security, defense, economic, and foreign affairs of its two provinces—Kosovo and Vojvodina.

But for the first time since the 1971 Croat nationalist crisis, a republican leadership is openly appealing to nationalist sentiments to achieve political ends. Serb party chief Slobodan Milosevic has now gone beyond what Croat leaders did in 1971: He is publicly encouraging mass ethnic demonstrations—a political dynamic which may ultimately evolve out of his control. He has steadily advanced his political career by exploiting the plight of Kosovo Serbs, and gives no indication of stopping before he achieves his short-run political objectives in Kosovo and what may be his long-term goal of a leading role in Yugoslav politics for himself and Serbia.

Serb nationalism has intensified steadily since the 1981 ethnic Albanian riots in Kosovo. Through Milosevic’s encouragement, sentiments have become virulent and aggressive. For the first time in postwar Yugoslavia, Serb demonstrations are being organized outside Kosovo province and Belgrade. Moreover, since the first protest march by 10,000 disgruntled Serbs and Montenegrins in Vojvodina on July 9, mass rallies are occurring on a weekly basis and are attracting growing crowds—the largest to date drew some 300,000. Increasingly, these Serb nationalist manifestations are taking the form of a popular movement, including such traditional symbols of the Serb nation as the Orthodox Church. Encouraged by Milosevic’s repeated attacks on leaders at various levels, Serbs are demanding the resignations of provincial, federal, and republican officials outside Serbia who are opposed to Milosevic’s campaign to amend the republican constitution.

Milosevic is orchestrating the demonstrations to force his provincial opposition and the federal leadership to adopt his political agenda on Kosovo. These tactics represent the most open and direct challenge to federal authority by a republican leader in the post-Tito era. Milosevic is acting in direct violation of established party policy: The federal party presidium explicitly condemned such ethnically inspired gatherings in July, calling on party organizations at all levels to prevent their occurrence. And on September 20, the collective State Presidency condemned the demonstrations with equal force, calling for their end and for leaders who do not prevent ethnic divisions to be “taken to task.”

The political stakes have now reached unprecedented proportions. The Belgrade Socialist Alliance, the city party’s official mass organization, called for a mass rally in September in the city, apparently to coincide with a federal party plenum on political stability. The demonstration, which was expected to draw a crowd of 500,000 to 1 million Serbs and Montenegrins, has now been rescheduled for October. Planners apparently realized that interrepublican differences would prevent the party from holding the plenum during September. A gathering on this scale in direct defiance of the federal party would cast that body into political irrelevance and would be the most dramatic sign to date of the supremacy of the republics over Yugoslav institutions.

The impact. As a result of Milosevic’s tactics, Serb-Albanian relations have deteriorated to their lowest point since the 1981 Kosovo riots. The potential for ethnic violence increases with each new Serb demonstration. Moreover, the non-Slav, Muslim Albanians are increasingly alienated from a system they perceive as being Serb-dominated and discriminating against them. Within the past several weeks, underground pamphlets have been distributed in Kosovo advocating an armed Albanian uprising; and some 22 Albanians in Macedonia were recently jailed and fined for participating in a violent protest against the enactment in that republic of bilingual education.

Interethnic relations in Vojvodina are strained but less troubling. Although the province has perhaps the most diverse ethnic mix of any region in Yugoslavia, intercommunal affairs have been fundamentally sound for most of the postwar period. But Milosevic-inspired “solidarity” demonstrations by Vojvodina Serbs, who constitute approximately 55 percent of the population, have created tensions with the province’s large Hungarian minority (some 14 percent) and other minority groups and are exerting enormous pressure on the provincial leadership—forced or voluntary departures of high-level officials will remain a near-term possibility. Retired military general Petar Matic recently resigned under pressure from his position as president of the Yugoslav veterans’ organization, and Bosko Krunic may leave his post as Vojvodina’s representative on the federal party presidency.

The Serb-Albanian imbroglio also threatens the stability of Serb ties with Yugoslavia’s larger, more important ethnic groups and, ultimately, the political cohesion of the country as a whole. To non-Serbs, the Serb nationalist resurgence is directly responsible for increasing ethnic tensions throughout the country. Milosevic’s tactics raise the specter of a revanchist, Great Serb nationalism bent on dominating Yugoslavia—as was the case during the interwar period—which could provoke a counterreaction from other ethnic groups, particularly the Croats.

By relentlessly pursuing his political agenda on Kosovo—including attempts to build alliances with like-minded regional leaders—Milosevic has seriously exacerbated fundamental differences within the collective Yugoslav leadership. The net effect has been to destroy even the facade of unity, publicly confirm the drift toward disintegration of the federal party into eight separate regional organizations, and further erode public confidence in the party as an institution capable of coping with the country’s problems. At a time when Yugoslavia needs agreement among its disparate political groupings in order to enforce the tough decisions required to pull the country out of financial crisis, Milosevic’s tactics are instead reinforcing ethnic and regional barriers to compromises on broader public policy.

Out of control? By inciting ethnic animosities, however, Milosevic may have unleashed a political force he cannot control. An unofficial committee has already been set up privately by Serbs and Montenegrins to organize mass rallies in other parts of the country. This quasi-political body has sponsored demonstrations in Montenegro and Vojvodina and announced its intention to hold “solidarity” rallies in Slovenia and Bosnia. It is also assuming governmental functions in Kosovo that provincial authorities have been unable to provide: The committee intervened in the village of Prekale—where intercommunal tensions had so deteriorated that 22 Serb households had announced collective emigration—and convinced residents to remain in the village. (Prekale was one of the first areas to receive members of the Serb republican militia unit dispatched to Kosovo on September 10.)

When the mass marches first began, the extent of Milosevic’s control—whether he was actually leading events or merely responding to this groundswell of popular emotion—was unclear. He was forced to intervene in July to avert a potential crisis during the aforementioned federal party plenum: The “organizing” committee called off a march on Belgrade to coincide with the plenum—but only after a direct appeal from the Serb party presidium. Still, several hundred Serbs came to Belgrade to protest.

Milosevic has now demonstrated, however, that he is basically in control of events: Bosnia and Slovenia have condemned the rallies and refused to give the “organizing” committee permission to stage demonstrations in their republics. Bosnian authorities indicated that they would use all means, including legal action, to prevent such gatherings. The committee initially went ahead with plans for rallies in the republic but eventually backed down on September 11—albeit six days after Milosevic went on public record that the decisions by the two republics should be heeded.

Outlook. Deployment of the Serb republic militia unit to Kosovo on September 10 bolstered Milosevic’s image among Serbs as a leader capable of taking action to protect their civil and ethnic rights in the Albanian-dominated province. But the planned mass rally in Belgrade could well become a watershed in his career.

The federal party appears unable to prevent the protest; despite public warnings about “party discipline” against those undermining “democratic centralism,” plans for the gathering continue. Even if Milosevic decides to call it off, the already limited authority of the federal party will have been seriously eroded. Milosevic in effect is exploiting one of the greatest weaknesses of the political system bequeathed by Tito—the inability of the federal party leadership to rein in an errant republic leader. Current party statutes and the lack of Tito’s authority make it difficult for the federal leadership even to censure Milosevic, much less oust him.

Milosevic may have something larger in mind with the planned mass march. He reportedly has been demanding—during the special party conference in May and more recently through the city party organ in Belgrade—the convocation of a special party congress to replace the current federal party leadership if it fails to move decisively in addressing the country’s problems. His ultimate goal may be to change fundamentally the “rules” of the Titoist system—collective leadership and responsibility, regional representation, consensual decision-making, etc.—and create a “new” Yugoslavia, one based on a more centralized and authoritarian political model.

He could be calculating that the upcoming plenum will produce few, if any, tangible results and that a massive show of support for his political agenda immediately afterward could generate the political momentum (or the political crisis) needed to convene an extraordinary party gathering. Such a meeting could provide Milosevic with the opportunity to fulfill not only his Kosovo agenda but also his personal ambitions for a larger role in Yugoslav politics. At a minimum, he may succeed in toppling several of his opponents in Vojvodina and Kosovo if Serb demonstrations highly critical of those leaders continue to be held in the provinces.

Viewed from one perspective, several political trends are evolving in Milosevic’s favor. He is now the undisputed leader of Serbia “proper”—i.e., Serbia without the provinces—and has rapidly become the leader of the entire Serb ethnic nation throughout Yugoslavia. He is likely to remain in these positions unless he makes a fundamental political misstep which precipitates some form of collective federal action against him. Serbia currently lacks a leader of sufficient stature to challenge him, and his tactics vis-a-vis Kosovo have made him one of a few genuinely popular leaders—at least among Serbs—in Yugoslavia today. As a result, a political move by another Serb against Milosevic would also be a stroke against his policy line on Kosovo—a step likely to invite the wrath of the entire Serb nation.

But the leaderships in Slovenia, Bosnia, Vojvodina, and Kosovo now actively oppose Milosevic. The Croat and Montenegrin leaderships appear internally divided by Milosevic’s tactics and at present undecided on how to respond. Only Macedonia, its Slav-dominated leadership deeply concerned over the burgeoning Albanian population in the republic, appears to be Milosevic’s natural ally—but it is unknown to what extent Macedonians actively support Milosevic in federal fora. With the increasing size, frequency, and highly emotional political content of Serb mass demonstrations, it is not inconceivable that this diverse group will be forced into a political showdown with Milosevic at the upcoming federal party plenum—leading to either his departure or extensive, high-level changes in the Yugoslav leadership. It is more likely, however, that if an anti-Milosevic group does take action, it will attempt to reprimand Milosevic, not remove him from power.

Milosevic would have to take some truly egregious, unilateral action—such as dispatching Serb republican militia units to Kosovo without federal authority—to galvanize these disparate elements into a united political front willing to take more forceful, collective action against him—and Serbia. Although he has approached that political threshold on several occasions, he has always skillfully backed away—and will likely continue to do so.

Milosevic has succeeded in reinforcing the rapidly growing federal recognition—evident last October with the dispatch of a special 400-man federal police unit to Kosovo—that the province is an all-Yugoslav problem, not simply a Serb issue. At the July plenum the party apparently discussed change in the unit’s size and positioning, and in mid-August the State Presidency decided to broaden the unit’s mandate to allow it to provide direct assistance to provincial authorities in carrying out security tasks. In addition, federal officials have ordered the dispersal of approximately 270 police from all the Yugoslav republics—including those deployed on September 10 from a Serb republic militia unit—to some 22 locations in seven towns in Kosovo. Although these steps are not likely to stabilize intercommunal relations in Kosovo in the long term, they allow Milosevic to claim positive movement on guaranteeing an ethnic Serb presence in the province.

Without significant political compromises, however, Kosovo will remain a region in an almost constant state of crisis for the foreseeable future. Intercommunal relations possibly could be stabilized if gerrymandering of local political boundaries, currently under way, creates ethnically pure or near-ethnically pure Slavic enclaves. This, combined with the amendments to the Serb constitution, could allow republican authorities in Belgrade selectively to funnel development funds into these areas and also protect the rights of the indigenous Slav populations—thereby maintaining and guaranteeing an ethnic Serb presence in the province. But demographic trends—Slavs will likely constitute only 5 percent of the Kosovo population by the time of the next census in 1991—and Milosevic’s willingness to exploit ethnic animosities for political purposes argue against this effort’s success in calming the province.

2. The Slovene-Military Confrontation

Yugoslavia’s most liberal republic and one of the country’s most conservative political institutions are locked in a political struggle, ostensibly over four ethnic Slovenes (three civilians and a warrant officer) who the military alleges planned to publicize classified military information. A closed military court on July 27 sentenced “the Ljubljana Four” to prison terms ranging from 5 to 18 months for the civilians, and four years for the enlisted officer. The case is currently on appeal before the highest military court in Belgrade. The effect of this trial is to place Slovenia and the Yugoslav military in a larger confrontation over the scope and pace of political liberalization in Yugoslavia.

The military has maintained that its case against the three civilians is not related to their past criticisms of the army. Prior to the arrests, however, the Yugoslav People’s Army (JNA) had grown increasingly alarmed over the rapidly evolving political scene in Slovenia. The evidence indicates that the military had considered direct intervention there but was preempted when the order was leaked to the Slovene youth newspaper by one of the defendants. The president of the Slovene republic also privately confirmed press allegations that the JNA had planned to arrest selected antimilitary civilians and had asked Slovene security officials in March if they could contain any ensuing unrest.

The arrests came after several months of increasingly contentious Slovene press reports questioning the JNA’s role and its position in modern Yugoslavia. The military also deeply resented the Slovene government’s ability to prevent federal prosecution of Slovene activists and the republic party’s disregard of Yugoslav party and government urgings that it “control” the situation.

The JNA no doubt intended the arrests as an explicit warning to the liberal Slovene leadership that, if it is unwilling to maintain political “orthodoxy,” the military is ready to do so. But the JNA badly mishandled the trial of the Ljubljana Four from a political perspective, refusing on grounds of protecting “state secrets” their requests for an open hearing, civilian defense counsel, and most important, conduct of the trial in Slovene.

Most Slovenes considered the defendants innocent—some 20,000 rallied in defense of the four in Ljubljana on June 21—and the secret trial illegal. And the republic leadership vigorously defended the right of Slovene youth to voice dissenting views, as part of the campaign to build a “civil society” based on the rule of law. The authorities demanded at the federal level that the military respect the Constitution and due process of law in handling the case. They also created an independent council for the protection of human rights and requested that proposed revisions in the republican criminal code be expedited—parliamentary debate has already begun in Slovenia on changing the law concerning military trials for civilians to include public trials and civilian defense attorneys.

But the republican leadership—probably in an effort not to antagonize the military unduly—has not rigorously pursued its defense of the four as demanded by some Slovene activists. Popular requests for political intervention in the trial have also been rebuffed. But the Slovene leadership and the populace did move back into political step on the language issue. The leadership has seized the military’s refusal to use the Slovene language during the trial—the one issue which unites all Slovenes—in order to regain some of its lost popular standing. The authorities have forwarded requests to the federal State Presidency and the federal parliament, noting their official concern on this score and insisting that Slovene be consistently used in all state organizations and military courts in the republic.

Unlike the Serb national question, both sides in the Slovene-military confrontation are likely to find a face-saving way out of their current test of political wills. The Slovene youth press exposed the former defense secretary in a case of personal corruption—gross misappropriation of military funds—and his response had all the trappings of a personal vendetta against the Slovene youth editors specifically and Slovene liberalism generally. His successors do not appear to have the same emotional involvement in the case and are likely to view the situation in and around Kosovo as a greater threat to Yugoslavia than Slovenia.

For their part, Slovenes as an ethnic group are very rational political actors, and local leaders are very much aware that the issues involved are larger than their republic. The expansion of political pluralism in Slovenia is directly dependent on the democratic development of the federation as a whole—any reversal in Slovenia will have serious consequences for all of Yugoslavia. Slovene authorities perceive far more important issues on their political agenda to push at the federal level; they will be careful not to allow any social unrest to be used as a justification for military intervention.

As a result of these considerations, if no further action is taken against the Ljubljana Four, political tensions in the republic should gradually subside from their recent high levels. But tensions will nevertheless linger. The military appears determined to prosecute Slovene recruits—as apparent in recent cases in Bosnia—on charges of nationalist agitation and disrupting interethnic relations. And Slovene youth have not been fundamentally deterred from advancing their programs: The official socialist youth league in the republic hosted an international conscientious objectors conference, August 25–28.

At the popular level in Slovenia, moreover, is a growing suspicion that the JNA’s actions against Slovenes are part of a larger effort directed by the Serb republic to recentralize political power in Yugoslavia—under Serb leadership. Milosevic’s actions reinforce these suspicions. As a result, historical Slovene reluctance to change the political status quo of a highly decentralized federation in Yugoslavia will be reinforced, and leading Slovene politicians will attempt to block or significantly water down political amendments to the federal Constitution which they perceive as leading to a strong central government.

In the most extreme case, military intervention in Slovenia could still become a self-fulfilling prophecy. A refusal by the military court in Belgrade to hear the appeal of the Ljubljana Four, a decision in favor of longer sentences (as now demanded by military prosecutors), or new arrests of Slovene civilians could still precipitate mass popular demonstrations which the military might use as justification for wider involvement in Slovenia.

Over the longer term, the steps taken by the Slovene authorities should reduce the military’s ability to circumvent legal norms and extend civil liberties—and democracy—in Slovenia. But unless there are corresponding changes in the political thinking of the highest echelons of the military, the danger of confrontation, or military intervention, remains.

3. A Restless and Potentially Politicized Work Force

Dissatisfaction with declining living standards led last year to a postwar record number of strikes. But work stoppages in Yugoslavia tend to be short-lived and generated primarily by such specific issues as wage grievances which are usually resolved at the enterprise or local level without the involvement of republic or federal authorities.

Recent marches by disgruntled workers on Belgrade and republican capitals are a different kind of protest and have clearly spilled over into the political arena. Workers have sharply condemned individual officials for abusing their privileges and have demanded that incompetent leaders be removed and social reform implemented.

Belgrade witnessed several major labor marches this summer, the largest involving some 4,000–5,000; in one case approximately 1,500 striking workers forced their way, by sheer weight of numbers, past security police and into the federal parliament to air their grievances. Similar demonstrations occurred in Bosnia, Croatia, and Slovenia during the summer. Almost all of these marches originated in enterprises that had been insolvent for extended periods; thus far no major incidents of violence have been reported.

Federal leaders now concede that strikes under “worker self-management” will continue. Authorities at the federal and republican levels are currently considering a proposed constitutional amendment which would “legalize” strikes and a “strike code” for official trade unions and workers during work stoppages—both would recognize existing reality and help dissipate worker discontent. According to the president of the federal trade union organization, Belgrade will permit local unions to support striking workers as long as they do not challenge the constitutional system. In another first, the president of the Yugoslav party presidium recently warned the party that unofficial trade unions will appear unless the official ones actually represent the workers; he called on local party cells to support “justifiable” strikes.

Thus far, the authorities appear more firmly committed to enforcing economic austerity than they were in the past, granting in most cases wage increases only if they are within legal boundaries. But the true test of their determination will come as workers returning from summer vacations find that spiraling inflation and wage controls have further reduced living standards. New marches have already occurred: Two groups, albeit numbering only a few hundred each, marched on Belgrade in early September; and a protest march by more than 1,000 workers occurred in Bosnia on September 19.

The stakes are high; even limited concessions granted to strikers in the name of political expediency compound the government’s long-run economic problems. To cope with the threat to social peace of the first marches earlier in the summer, Belgrade granted limited wage concessions and sought in several cases to bail out insolvent enterprises. And the plight of the workers has now become a political football: The federal trade union leadership has forcefully demanded that the government ease legal wage restrictions and introduce a new social welfare program, and the federal party presidency has endorsed the union’s request to ease pay restrictions on profitable enterprises.

The government has responded by renewing an old promise to prepare a “comprehensive” social program to protect the unemployed and the lowest paid workers. But capitulation to workers’ demands will delay implementation of structural reforms and force the IMF to scale back performance targets in its recently adopted standby agreement—as happened under the previous accord. Belgrade ultimately could be forced to seek renegotiation of the latest IMF agreement.

This summer’s protest marches set a precedent that, as the economy continues to deteriorate, may be used by workers in other factories of borderline solvency to demand political change. Workers are likely to be further encouraged by the legalization of strikes, the eventual adoption of “strike codes,” and the participation of local party officials in “justifiable” work stoppages. Confronted with a more serious wave of strikes and workers’ marches, political authorities at all levels are increasingly concerned about the social costs of enforcing new, stringent austerity measures and less inclined to accept some of the proposed market-oriented economic amendments to the Constitution.

Federal authorities have instructed police throughout Yugoslavia to avoid force against demonstrators or strikers—except when property, lives, or public order are threatened. Police fully expect large numbers of strikes and are making preparations to handle mass demonstrations in Belgrade, but they apparently have been told that use of firearms is out of the question. These guidelines were observed during the recent marches, and crowd control was effective. Thus far police have not attempted to stop large numbers of strikers from marching on the federal parliament or other public buildings in Belgrade. Yugoslav authorities may, however, be forced to implement new security measures this fall if marches become too frequent or disruptive. Belgrade could demand that local officials prevent workers from leaving their communities or, barring that, send high-level representatives to hear workers’ grievances before they reach Belgrade.

1. Source: Reagan Library, Lisa Jameson Files, Subject File, Yugoslavia. Confidential. Drafted by Adrian Harmata (INR); approved by Richard Clarke (INR).
2. This report is based on information available as of September 23, 1988. [Footnote is in the original.]