THE MIDDLE EAST Arnaud BorreI—Slpa-BIack Star An lraqi casualty in Baghdad: An unexpected and seemingly unwinnable war brought れ e 物 turmoil tO a troubled 「 egiO れ By Tony 0 ftO れ raq and lran plunged headfirst intO an unexpected—and ap- parently unwinnable—war for control Of their vital Persian Gulf 0 ⅱ fields and waterways. Syria and Jordan, never the best of neighbors, ordered thousands of troops tO a face-off on their border in a bully-boy maneuver that re-emphasized the Arab world's internal divisions. The ever-glacial peace talks between lsrael and Egypt stopped dead once again because Of lsrael's drive tO establish more settlements in the occupied West Bank and the disputes within Menachem Begin's government. As a result, 1980 was an ominous year for the fractious MiddIe East— and it may have marked the beginning Of the most dangerous decade in modern history for that chronically troubled region. ln past years the bitter and bloody clashes between lsraelis and Arabs have been the area's most clear and present danger. But in 1980 the prospect of another all-out war on that front faded somewhat because 0f the Camp David agreement. Whatever its failings are, or may prove tO be, the accord temporarily removed the most immediate source Of tension and kept the lid on a Slm- mermg pot. But then lran's messlanic ruler Ayat011ah Ruh011ah Khomemi set a new caldron boiling. Throughout the year he and his numons not only prolonged the seemingly senseless cap- tivity 0f 52 American hostages but waged a propaganda war with Teheran's lslamic rivals in Baghdad. When September came, the tWO countries stopped trading words and started trading bul- lets. The fighting since then has been nonstop, and Middle East 26 experts fully expect that the battle will continue well int0 1981. The consensus is that lraq's President Saddam Hussein made a monumental mistake when he started shooting. lranian exiles, notably former Prime Minister Shahpur Bakhtiar, had whispered tO Saddam that Khomelni's regime was tottering and that a mere nudge would topple it. The lraqi leader believed what he was told. He ordered his well-equipped army and air force tO launch a pre-emptive strike against lran. HiS aims were clear: tO force lran tO surrender the islands known as Greater and Lesser Tunb and Abu Musa in the Strait of Hormuz; tO take control Of the Shatt al Arab, the entryway t0 the Gulf; t0 seize lran's oil-pro- ducing province 0f Khuzestan with its refinery complex at Aba- dan—and t0 spark a popular revolt against Khomeini. So far, Saddam has failed in every respect. hree months after his initial assault, his forces remained at a standstill. They have secured only a shaky f00th0 旧 in lranian territory. They have been continually harassed and bloodied by lran's revolutionary guards and by a surprisingly effective lranian Air Force. NOW the invading lraqis face three months Of rainy winter weather, which will make any further advances punishing, and perhaps impossible. Far from being top- pled, Khomeini has been able to invoke the threat from a second 、、 foreign devil" tO persuade the lranian masses tO unite against an ancestral Arab enemy and consolidate his grip on power. By contrast, all that Saddam has managed tO dO is tO give lran 、 s zealots added strength—and imperil his own position. NEWSWEEK/JANUARY 5 、円引

THE SOVIET BLOC By WiIIiam E. Schmidt ech Walesa hardly seemed like a man to make a revolution. He is unassuming, unimposing and, until he tOOk control of Poland's labor movement, he was also unemployed. But ⅲ 1980 , Walesa led a workers' revolt against the Polish Gov- ernment—and its Soviet overlords—that shook the world. He forced an Eastern-bloc government tO recognize a free labor union for the first time ever, and he wrote a charter for that union that did not pay obeisance tO the Communist Party. His message was simple and he said it over and over again during the workers' struggle: "l want democracy. WaIesa's trlumph was electrifying largely because the odds against him were SO long. Yet in his victory lurked the specter of defeat. Even in August, during the first strikes ⅲ the Gdansk shipyards, the threat Of a SOViet invasion loomed as a sobering counterpoint t0 the exhilarating upnsing 0f the P01ish working class. The workers made history, but they evoked history, t00 : Hungary in 1956 and Czechoslovakia in 1968 were painful re- minders that expenments in freedom could be crushed by Soviet tanks. As the year drew tO a close, the lingenng question remained unanswered: how far would the workers be permitted t0 go before the Kremlin decided enough was enough? No one doubted that the Soviets would move on Poland if they felt the country was slipping from their grasp. Yet even as Russian troops massed at the border, KremIin offlcials said they hoped the P01ish Government could solve its own problems. "We do not want to interfere in the Polish situation or harp on its negative aspects," said Vadim Zagladin Ofthe SOViet Commu- Striking 00a ー miners in SiIesia: HO 響 far 響 0 ー the 響 0 「 ke 「 5 be nist Party's foreign department. With 80 , 网 troops in Afghan- istan and another half million along the Chinese border, attacking Yet the erosion of Communist control in Poland—and the possible evolution Ofa more nationalistic, pluralistic state would Poland would be a costly and awkward undertaking for Moscow. And the United States and its allies were quick to issue harsh be an unacceptable challenge t0 the SOViet Union. TO SOViet mili- tary planners, P01and is the linchpin 0f the Eastern-bloc defense warnings. President Jimmy Carter said that ・ "the future policies Of the United States toward the Soviet Union would be directly network, a strategic link between the western edge Of the SOViet and adversely affected by any use of Soviet force in P01and. ' Union and frontline units in East Germany. SOViet concerns about Although Carter' s tough warnings tO the Soviets over Afghanistan the geopolitical and strategic stakes 0f losing con trol 0f P01and had softened when Western allies failed to respond, this time were apparent in a recent Tass commentary: it warned that a he had the full cooperation 0f NATO leaders. "Afghanistan is nationwide rail strike in P01and would cripple the link between one thing, " said a government omcial in Bonn. "This is Europe. Moscow and East Germany—and pose a direct threat tO POIish Moscow has already resorted tO nonmilitary strategies in an security. attempt tO correct POlish waywardness. Communist Party leader Edward Gierek was replaced by Stanislaw Kania, who reshumed iberalization in Poland poses more than a military threat, the PoIitburo and enlisted the support of hard-liner Gen. Miec- however: Soviet leaders fear that Poland will become 4 zyslaw Moczar as the party's enforcer. "Moscow put the POIes model for Other Eastern-bIoc nations beset by the economlc on probation," said one European diplomat. "While it may have problems and food shortages that triggered the P01ish strikes. ruled out armed intervention for a while, this may be the necessary The KremIin leadership is also worried about unrest from within. first step tO eventual intervention. ' ' The second step, some analysts SOViet industrial workers, like their POlish counterparts, face severe suggested, could be an invasion in the guise Of Warsaw Pact shortages 0f meat and dairy products, and party boss Leonid maneuvers, designed tO put the Western allies 0 the track and Brezhnev has lately taken to reassuring the public that the gov- head 0 the diplomatic and economic sanctions the West has ernment is working t0 solve the problem. 、、 Can we take for granted been threatening. Other analysts contended that Moscow would any longer the fear and long-suffering patience 0f the Soviet peo- continue t0 keep its distance, negligible though it might be, as ple?' ' wondered one diplomat. Another concern is that the up- long as the P01es did not take an overtly anti-Soviet line. "One heaval in P01and, coming on top 0f an lslamic rebellion in Af- Of the critical differences between the situation in Poland and ghanistan, could create problems in the SOViet Union's ethnic Czechoslovakia, ' ' a diplomat told NEWSWEEK, "is that so far republics. Lithuania, which shares a border with P01and and no one has attacked the Soviet Union, or the basic nature of is largely Cath01ic, is a special worry. Soviet fears 0f a sympathetic Soviet-Polish ties. ' Lithuanian reaction tO the events in POland may explain why NEWSWEEK/JANUARY 5 , 1981 28

A Capitalist for Labor ably the Camp David peace between Egypt and lsrael. His biggest mistake may have been allowing the Shah 0f lran t0 fall. B0th construction industry has been whOlly on e grew up in Bayonne, N. J. , a town events t00k place in late 1978 , and some H the management Side. . AS executive VICe so Catholic and so Democratic that historians are already arguing that Carter president Of the Schiavone Construction concentrated on the wrong one. The rise When Raymond James Donovan was a Co. of Secaucus, N. J. , he handled labor boy, "the most honored name in my home, of Khomeini and the lran-lraq war show negotiations for one 0f the biggest bridge- that 0i1 supplies in the gulf can be endan- after the Pope, was FDR. " But Donovan, and-tunnel contractors in the Northeast. now 50 , became a construction executive gered by factors that have nothing t0 d0 Donovan is an affable, down-to-earth man- and a mid-life convert tO conservative Re- with the Arab-Israeli dispute. The argu- ager whose strength is a sure sense Of the publicanism. As Ronald Reagan's New ment that Washington should pressure ls- needs and feelings 0f his employees. "He's Jersey state chairman this year, he helped rael intO concessions on Palestinian auton- not a wheeler-dealer construction.com/ W00 the BCEC (blue-collar, ethnic Cath0- omy t0 placate the Arab 0 ⅱ producers now pany executive," says one associate. lic) vote. He also proved to be one 0f Rea- rings h0 Ⅱ OW. Reagan's team must find a Bobby Ewing, not J. R. ' gan's best fund raisers (singlehandedly way t0 stabilize the Middle East that goes Donovan also happens t0 be far beyond narrow Arab-lsraeli accords. bringing in $ 68 , 開 0 ) and a committed conservative—a an able amateur advance Stationing U. S. forces in the region may supporter 0f the proposed prove tO be a better answer than relying man. Donovan organized "subminimum for teen- Reagan' s Labor Day kick- 0 れ surrogates like the Shah or leaving a agers, and a crltic Of the OC- 0 寵 rally in Jersey City, and power vacuum on the SOViet doorstep. cupational Safety and Health ・ Rediscovering Latin America. If the arranged the rally's media- Administration. One Of his Reagan team is tO impress friends and foes first tasks will be to find a new abroad, the key regions it must protect are head for OSHA and set new the Persian Gulf and Latin America—the priorities for the embattled gulfbecauseofthe energy lifeline and Latin agency. He must 引 SO decide . America because it iS closest tO home and what tO dO about labor's costly program easiest t0 defend. If Washington cannot tO assist workers whO lose theirjobs because prevent the spread 0f Soviet-backed mis- Of competition from imports and take a Chief on Latin Amencan SOil, governments hard 100k at the department's manifold em- around the world will draw appropnate ployment-training programs. Clashes with conclusions. organized labor seem inevitable—and Reagan's advisers dO not pretend tO have Donovan won't have much time for hiS all the answers to these problems. They own on-the-job training. understand that power remains the vital backing for diplomacy, but they admit they TOM MORGANTHAU with SUSAN AGREST in New don't yet know hOW tO respond tO the as- Jersey and HOWARD FINEMAN in Washington pirations Of people in developing countnes, A Whist1e B10wer who will form 85 per cent of the world's population by the end 0f the century. ln ls Acquitted Latin America, for example, Reagan can- not ignore human rights and arm friendly Last May an all-whitejury acquitted four dictators without courting disaster. The white Dade County, 日 a. , policemen 0f mix between power and principle is a tough charges that they had beaten t0 death Ar- call. Carter may have erred in overempha- thur McDuff1e, a black insurance executive. sizing human rights, but Reagan's people New Jersey Newsphotos Miami's black neighborhoods exploded in are aware Of the dangers in shifting t00 DO 〃 0 広 ' ″ $ お 0 みの Ewing, れ工 ' nots, and Justice Department lawyers far the other way. quickly filed charges that McDuffe's civil genic meeting in the shadow 0f the Statue Despite all the problems he faces, Reagan rights had been violated. Astonishingly, Of Liberty between Reagan and Stanislaw will take omce with a stronger military, they didn't try the four acquitted cops but Walesa, whose son Lech is the leader of economic and political base than any Of the prosecution's star witness at the murder the POliSh workers' movement.Donovan'S his allies or adversaries abroad. The United trial, policeman Charles R. Veverka. Last efforts impressed the candidate—and last States can no longer dominate world affairs, week a jury in San Antonio acquitted Ve- week Reagan named Ray Donovan t0 be but it still has enough strength t0 be pre- verka—tnggermg scattered rock throwing emin•ent. And Reagan probably will have his Secretary of Labor. in Miami's black neighborhoods. The nomination actually had been Don- time tO get his foreign-policy house in or- Why did Justice try Veverka? Federal ovan's since the day after "Thanksyving, der, ifonly because the Kremlin's problems lawyers explained that they had their best when Reagan secretly called t0 0 飛 r him are larger than his. With 450 , 80 men tied case against Veverka because he admitted thejob. "I have to tell someone, ” Donovan down on the border with China, another at the murder trial that he had falsified confided tO a friend. "Better start praying 120 , 000 troops in or near Afghanistan and offlicialreports t0 make it appear McDuffe more than 3 開 , 08 poised on the P01ish for me. ” The plea was heartfelt: Donovan had been hurt in an accident. Thejury fore- has never held government omce, and the frontier, the Soviets already are stretched man said Veverka was acquitted precisely announcement Ofhis appointment left Rea- thin. Their economy is stagnant, .and the because he did confess tO the cover-up and gan's few allies in organized labor standing aging, ailing Brezhnevleadership has failed, because he agreed tO testify against the Oth- flat footed. "While we supported another SO far, tO agree on the political successron. er policemen. Assistant U. S. Attorney Bri- candidate," said Teamsters union president ln short, the Soviets are likely t0 be 10S - an McDonaId said the investigation 0f the Frank Fitzsimmons, are well aware ing their stomach for further adventurism Other four Miami cops would continue— ofMr. Donovan's distinguished record and abroad just when Reagan takes Offce with and Veverka said he would cooperate if a mandate for American resurgence. If the his background in labor. '' called again as a prosecution witness. ln fact, Donovan's labor background is world is lucky, that combination may ⅲ - Meantime, a H011YW00d producer was said timately lead tO less international tension, slender at best—a few unionized summer t0 be planning a movie on Veverka's li た . jobs—and his distinguished record in the rather than more. NEWSWEEK/JANUARY 5 , 1981 イ T 、 0

FA 旧 S yent beyond that, reorganizing 's staff, acting as liaison between agon and the State Department, れ screening all intelligence information be- fore it reached the President' s desk. He also became the White House's eyes and ears in Vietnam, making sixteen fact-find- ing trips tO the war zone for Nixon and K. issinger. Haig' S emciency and stamina ()e routinely worked seven days a week) were soon legendary. "When you see the lights burning late in Kissinger's Offce, ' ' Nixon once noted, "it's usually Haig. Not all of Haig's White House work was quite so visible. ln 1969 , in an effort tO find out whO was leaking information about the Administration's war plans, Nixon and Kissinger decided t0 tap the telephones Of seventeen Journalists and ル″んルⅸ 0 〃加 7973 , ⅵ所お 0 加 798 伀 government omcials. Haig personally re- quested the FBI t0 install twelve 0f the AP photos taps. The next year, he asked the FBI for four more. When the Senate Foreign whO would get the bedroom next tO Nixon recall. ' ' Four months later, after special Relations Committee later asked him about on foreign tr1PS, ” recalls one insider. prosecutor Archibald COX got a court order his actions, he said he was merely following Haig' s role in Nixon' s final days is still directing the White House tO hand the tapes over tO him, Haig was the one whO tried orders. a matter Of controversy. Special Watergate Stain: By 1972 , Haig had been promoted prosecutor Leon Jaworski once described tO persuade him tO accept edited transcripts to the rank 0f maj or general and been given Haig as trying "t0 placate me while helping instead. When Cox balked, Haig—presum- direct access to the Oval 0 用 ce. As one Nixon frustrate me in the search for the ably acting at Nixon' s direction—tele- Of Nixon's most influential advisers, he truth. ” ln his memoirs, however, Jaworski phoned Attorney General Elli0t Richard- headed the advance party that planned the son and ordered him t0 fire the special insisted he didn't believe Haig had ever President's first trip tO China, and he sat actually "lied. " What seems clear is that prosecutor. Richardson refused, choosing in on the first round of peace talks with Haig tried his best t0 keep the Watergate instead to resign. SO Haig called Deputy the North Vietnamese in Paris. Haig investigation from implicating the Presi- Attorney General William Ruckelshaus to pressed Nixon hard tO take the toughest dent directly. " I never had a sense Al was ask if he was ready to fire Cox. Ruckelshaus wasn't. "WelI," Haig replied stonily, "you possible stance with the North Vietnamese, involved in obstruction Of 」 ustice, ' ' says a urging him tO bomb Hanoi and mine Hai- know What it means When an order comes former aide. "But he was always theleading phong harbor—two controversial recom- proponent 0f hanging tough. ' down from the Commander in Chief, and mendations that Nixon ultimately accepted. Or 0 飃 lt was a narrow line. The 、 Mhite a member Of the team can't execute it. ' Haig's White House career seemed tO House tapes show that on June 4 , 1973 , Haig alSO tried tO get COX' s successor, come t0 a happy end in September 1972 , Haig urged Nixon to side-step the allega- Jaworski, tO go easy on Nixon. According when Nixon leapfrogged him from two- tions Of former White House counsel JOhn t0 an April 1974 memo by Deputy Attorney star maJ0r general t0 four-star full general Dean by telling investigators "you 」 ust can't General Laurence H. Silberman, Haig com- and named him tO the Army' s second- plained bitterly about the aggressive- highest post, vice chief 0f staff. But / $ K な $ 加 g イ〃り : The ー襯 e ′催 ness Of Jaworski's investigation. "lf ⅲ May 1973 , as the spreading stain Leon wants tO get rough, ' ' Silberman Wally McNamee—NEwswEEK of Watergate was about to force the quoted Haig as warning him, "we will resignations Of top White House aides get rough. ' H. R. Haldeman and John Ehrlich- Haig continued trying tO protect man, Nixon asked Haig to come back Nixon until well intO the summer of as his ' 'interim ” chief of staff. At first 1974 , when White House lawyers told Haig said no. "l never wanted tO leave him of the damning tapes that proved the Army, ' ' he later explained. "The Nixon had been involved in the cover- last thing I ever wanted tO dO was be- up. "The smoking gun really staggered come politicized. ” Nixon, however, in- him," a former White House colleague sisted, and Haig soldiered back t0 the recalls. "He had come back to the White House. White House believing his ro 厄 was Haig wasn't the only one uneasy to defend the Presidency and that the about his new job. His former boss, best way t0 do that was to defend Rich- Henry Kissinger, found Haig's sud- ard Nixon. FinaIIy, he came to the den ascension distinctly unsettling. conclusion that the only way left tO Kissinger immediately braced Nixon defend the Presidency was tO ease Nix- and secured an agreement that he on's departure. ' would continue tO en. 」 oy unimpeded The Resignation: That he did, ca- access to the Oval Offce. Nonethe- joling the embattled President int0 giv- less, the tWO men spent most Of the ing up the fight. lt was, declared former next eighteen months jockeying for Nixon counsel Fred Buzhardt, "one position. "There were incredible of the most skillful, tactful, diplomatic, fights between Henry and AI over brilliant and most sensitive feats in 14 NEWSWEEK/JANUARY 5 , 1981

WORLD AFFA 旧 S forming a Muslim federation in north-cen- tral Africa. ln the process, he sent shudders through .nearby nations and achieved what the French newspaper Le Monde called senous reverse for PariS, ” long the area's trusted guardian. "Our hands are empty, confessed one French offcial. “、 re- duced tO the role Of spectators. ' The Libyan incursion is the latest move in a fifteen-year struggle between France and Libya for control of Chad, which has been torn by factional strife since it won its independence from France tWO decades ago. The latest round 0f fighting broke out in March with the collapse ofthe wish- fully named Government of National Uni- ty, imposed last year by neighboring Af- rican states. The battle quickly settled int0 a low-level guerrilla affair between Ha- 」 . CIaude Criton—Sygma bré's forces and a host Of factions sup- Go Ⅳ川川厩 / 0 尾″ん尾な加ル川Ⅷ化・ $ 川住″ルノ〃川〃ⅲ porting President Goukouni—until Gou- kouni signed a defense pact with Kaddafi tinue t0 fight Goukouni's "illegal" govern- bought $ 88 million worth of French arms last June. Late last month Kaddafi's ls- and civilian goods. France has rejected ment. But he also signed an African-spon- lamic Legion moved intO a staging area sored cease-fire agreement providing that 600 miles north of Ndjamena. French of- Kaddafi's call to divide Chad, with Libya all troops should be replaced by an African ficials first dismissed the legion as a ragtag taking the Muslim north and France re- peace-keeping force. Goukouni, wh0 orig- bunch Of illiterate mercenaries, then tried taining influence in the Christian-Animist south. But Libyan Foreign Minister Ahmed inally approved the pact, dismissed it as unsuccessfully tO persuade 0ther African el Chahati was flying to Paris this week 、、 nonsense. ” Kaddafi planned t0 fly t0 states tO take arms against it, then stOOd Ndjamena tO 」 Oin in Goukouni's victory by helplessly as the legion marched int0 tO make the suggestion one more time. For Kaddafi, who was humiliated last celebration. What would happen next was the capital. anybody's guess. lt was clear only that, Humi1iated: The French remaln com- year when his expeditionary force was de- for the time being at least, Kaddafi's Af- mitted to checking Kaddafi's expansionist feated in its effort t0 prop up Uganda's ldi Amin, victory was sweet, but far from rlcan Star was on the rise. designs, but they also want tO maintain their trade with Libya, which last year total. Habré vowed from Cameroon tO con- BOB LEVIN with SCOI 丁 SULLIVAN in Paris him the nation's "most intelligent and toughest" leader. Aleksei Kosygin, 1904-1980 If Kosygm lacked the heartiness and flair of Brezhnev, he made up for it in skill and an uncommon knack for survival. Aleksei Kosygin appeared strangely miscast as a successor The son 0f a lathe operator, he j oined the Red Army at the age 0f 15 following the B01shevik revolution, and at 34 was t0 Lenin, Stalin and Nikita Khrushchev. Unsmiling and self- effacing, he seemed the epitome Of the colorless bureaucrat. mayor 0f Leningrad. By the time war with Nazi Germany broke out in 1941 , Kosygn, wh0 somehow survived Stalin's When he died last week at the age of 76 many people were bloody purges of the late 1930S , was a Deputy Prime Minister. unaware that he had served as SOViet Prime Minister longer FoIlowing the war, Kosygin emerged unscathed from a fresh than any Other man—more than sixteen years. Throughout round 0f purges. ln his memoirs, Khrushchev marveled at that time he was one Of the tWO most powerful men in his country, working hand in hand with Communist Party leader Kosygin's talent for surviving the purges. "He must have drawn Leonid Brezhnev. Though the forceful Brezhnev was clearly a lucky lottery ticket, ” Khrushchev wrote. Lumbering: Kosygin's particular enthusiasm was econom1C senior partner, Kosyyn presided over the government ma- chinery. Their partnership came tO an end only last October, reform. But he ran intO strong opposition from party func- tionanes whO thought that any effort tO encourage individual when Kosygin resigned because of his rapidly failing health. initiative would weaken party control. Kosygin's The offlcial Soviet announcement said that KO- proposals were watered down, and ironically he sygin died 0f a sudden heart attack after "a long, was later blamed for the Soviet Union's lumbering grave illness. " Praising him as a statesman WhO Tass economic performance. was devoted tO "the ideals Of Communism, ” the Because of his ill health, Kosygin played only ann ouncement said that Kosygm would be buried a minor role in SOViet decision-making durmg on Moscow's Red Square near the KremIin. his last year as Prime Minister. He did not, for Kosygin' s image was that 0f a thoughtful man, aloofand alone. ln his leisure time he was a familiar example, take part in the top-level discussions figure among strollers in the Lenin Hills, where that led tO the decision tO invade Afghanistan. he would amble along paths overlooking the Mos- By Russian standards, Kosygin was a moderate 0 man and a stabilizing influence in bOth domestic cow River, his limousine trailing discreetly behind. Both Westerners and Russian critics of the regime whether his example will be followed by his accorded Kosygin great respect. Henry Kissinger described him as "disciplined and incisive," and successors. human - rights activist Andrei Sakharov called FAY WILLEY with WILLIAM E. SCHMIDT in Moscow 9 NEWSWEEK/JANUARY 5 , 1981

Asian, European and developing economies tO export their way out Of the slump. Government planners and economists no longer count on an early U. S. recovery to pull the rest of the world out of hard times. And the outlook for economic growth elsewhere is equally uncertain: ■ Western E 題 ro 0. The region followed America into trouble; both West Germany and France have been operating below the line S1nce midyear, and Britain has been in the same StraitS even longer. "Frankly," says Eurofinance's von Fieandt, "we are in the middle Of a recession. ' ' European economists fear that the drop in U. S. business activity will make matters worse. Eurofinance offlcials predict that the West German, British and ltalian econo- mies will be stalled at zero growth throughout 1981 , and that France and the Benelux nations will show only marginal gains. "Europe's recovery," says R011ey 0f Chase Econometrics, "will be slow, weak and long. ■ Latin America. The Latin economies grew faster than any Other in 1980 (approximately 4.4 per cent) and they promise to repeat that performance this year. Forecasters peg the 1981 rate above 5 per cent, with most Ofthe gains coming from Argentina, Mexico and the Andean Pact countries. Mexico is pumping enough 0i1 and natural gas t0 fuel a rise in its GNP 0f as much as 9 per cent, and 0i1 exporters like Venezuela and Peru are bolstering their industrial output because 0f the higher 0il prices. Argentina is now energy self-sumcient, and analysts expect a sharp recovery in its farm sector, which was hit by bad harvests last year. By contrast, Brazil's growth is bound tO taper off—but Planning Minister Antöni0 Delfim Nett0 predicts that GNP will rise by more than 7 per cent. ・ Asia. The key country is Japan, and despite some looming dån- WAR OF THE WHEELS For the global auto industry, 1980 was a watershed year. For the first time, Japan's car makers out-produced and out-sold the home-based operations 0f America's venerable Big Three. General Motors skidded into its first full-year loss—$ 824 million—since 1921 ; Ford dropped $ 1.2 billion, and Chrysler's $ 1.7 billion loss le れ it struggling for survival. Nearly 2 開 , U. S. aut0 workers were idle at the end Of the year; SO were twice that many workers in allied industries. ln Europe, deepening economic downturns shaved Volkswagen's profits considerably and moved Fiat to plan for possible layoffs 0f up t0 23 , 08 employees. While the auto companies may be down, they are not out. Even amid slumping sales and sliding profits—made worse by high interest rates—the U. S. autO industry is in the midst Of what Ford chairman Philip Caldwell described as "the most mas- sive and profound industrial revolution in peacetime history. The $ 56 billion in new investments that Ford and GM plan to make by 1984 rival the budget 0f the APOIIO space program. What the U. S. giants are scrambling to lead is the trend toward super-effcient " world cars, " whose component parts will come from whatever nations can make them most cheaply. That quest for economy Of scale, along with the quickening movement toward cybernetic production by industrial robots and increasing link- ups between various national autO companies—like Renault's ties with American Motors—will be the dominant industry trends of the ' 80S. By 1990 , experts believe, as few as eight major producers will have survived the decade's tO remain in the competition for world markets. Their model lines are likely t0 resemble four- wheeled clones. But though the new designs may lack flair, they are certain to shed a 10t of the built-in waste that made 1980 a hellish year for U. S. automakers. NEWSWEEK/JANUARY 5 , 1981 gers, it may escape outright recesslon once again. "Slowdown in the United States is going tO reduce demand for some Japanese goods," says Hugh Patrick, a specialist on the Japanese economy at Yale University. "But Tokyo's current account deficit may turn back intO surplus and private investment will start tO pick up. " Some economists forecast a 3 per cent GNP growth for Japan in 1981 ・—which could be the highest ofany ma. 」 or industrial nation. Elsewhere in Asia, the picture is far more gloomy. South Korea suffered a disastrous setback in 1980 when GNP fell by nearly 5 per cent. lts economy may be on the mend now, but experts d0 not expect a full-blown recovery until 1982. Singapore and Taiwan will post slow, steady growth, but Hong Kong may suffer if China continues tO cut its industrial program because of lack of development funds. "The present scale 0f capital con- struction," said the People's Daily recently, 、、 is still beyond the limit Of the country's ability. n the one stage where it has performed worst in recent years—inflation—the world economy stands tO dO better in 1981. Like death and taxes, rrsing prrces are certain. But the 0ut100k is for a steady reduction in inflation rates— unless 0 ⅱ prices d0 move int0 the $50-per-barrel range. West Germany's inflation rate is now less than 5 per cent, and the strict monetarist policies in vogue throughout much Of Latin America are curbing pnce increases. ln bOth the United States and Britain, current high inflation rates should come down gradu- ally to between 10 and 12 per cent during the year as a result of stiff controls being imposed. "There な progress in fighting inflation," says Morgan Guaranty's de Vries. "But we still have an uphill battle. ” ln 1981 , it is a battle the world economy may . start winning—even if it must come at the expense Of growth. ・ÄELIANT 、′「一新 ( △設ー設ーー盟 ie 47 1 Bruce Hoertel Ch ′ y 引・「 chairman し・・一 a0000a : A st 「 M99 ー・ fO 「 survival

LATIN AMER ℃ A THE AVENGING ANGELS Murry Sill—Miami Herald RiO 彙 i れ 9 at Archbishop Romero's funeral claimed 3 1 lives: Peace, justice—and people—were perishable commodities Right-wing forces are especially edgy about the situation in Nica- By Beth Nissen ragua. "L0ts 0f people worried that a leftist Nicaragua would fifth-grade history teacher at an elementary school in export revolution throughout the region," said one U. S. diplomat EI Salvador recently asked students to name the country's in Central America, 、、 but few foresaw hOW much a leftist Nicaragua leaders. Fourteen children answered, 、、 The army. '' Four would improve the market for right-wing reaction here. ' Rightists thought U. S. President Jimmy Carter was their Head of State. also have been greatly emboldened by Ronald Reagan's landslide And the remainder of the class of 28 left the question blank. election victory in the United States. The conservative forces 、 I gave them all extra credit, perceive the President-elect as an ideological ally and likely pro- said the teacher. "There isn't a right answer anymore. tector, although their enthusiasm anything but absolute. 、、 He's EI SaIvador may be the best example of a country without untrustworthy, like all gringos, but at least he hates Communists a clear leader, but all across Central America, there is an ongoing as much as we dO," said one right-wing activist in the reg10n. struggle over wh0 is—and wh0 should be—in charge. Sh00t- "He'd send in the Marines before he'd let Fidel Castro in the outS between leftist revolutionanes and right-wing backyard of the United States. '' —always commonplace—have become epidemic. Leftist leaders disappear from the streets in Guatemala. Nicaragua's business n EI Salvador, right-wingers control significant segments of community has been shocked by the violent death Of a prominent the nation's security forces and their agents have been on private-sector leader. And even in COSta Rica, which has remained a wild and unchecked binge 0f terror. Paramilitary groups relatively calm by regional standards, violence is becoming a prob- and death squads are widely blamed for much of the political に m. 、、 The right and the left, the East and the West, have all violence that has taken nearly 10 , 000 lives during the past year. discovered that the area is t00 strategically important not tO 、、 We know from history that the only way to control the left control," said one U. S. ambassador. Although most of Central is tO destroy them," said one self-described 、、 avengmg angel" America IS resource poor, its proximity tO the United States has of the right. 、、 We will tear out the Communist weeds whenever obvious tactical advantages—and disadvantages. 、、 The great worry they grow back, however many times. 、 is that Communist forces will take control Of Nicaragua, then Much ofthe violence has been aimed at the church. Last March, 日 SaIvador, then Guatemala and then drive up toward the soft Archbishop Oscar ArnuIfo Romero was assassinated by a gunman underbelly of Kansas,' says U. S. Ambassador to 日 Salvador 」 ust after delivering a sermon on 」 ustice and peace—certainly Robert White. the most perishable commodities in El Salvador's overheated social lnevitably, lightning on the left brings thunder on the right, climate. 、、 The death 0f Bishop Romero is a symbol of the tragedy and fear Of Communist expansion has led tO what one Salvadoran our nation is living through," said another priest. 、 lt is a tragedy analyst describes as a ViOlent 、、 resurgence against insurgence. of death and b od. " Near the end of the year, there were more 40 NEWSWEEK/JANUARY 5 、い ) 新

EUROPE DETENTE'S DARK DAYS By S00 靆 SuIIivan n Western Europe, détente came under greater strain in 1980 than ever before. With SOViet soldiers encamped in Afghani- stan, and Warsaw Pact troops massed on Poland's borders, European leaders had t0 face up t0 the fact that the nature 0f Soviet imperialism had not changed. lt was a painful admission— not least because East-West tensions endangered profitable eco- nomic ties. But even France and West Germany, which had insisted for months that dialogue with the SOViet Union must be maintained at all costs, acknowledged that the threat t0 P01and had hammered home the message 0f Afghanistan. Everywhere, advocates 0f dé- tente at any prrce were on the defensive. The new mood became clear at NATO's annual meeting in December. Both France and West Germany backed U. S. calls for quick, tough Western responses tO any SOViet move in POland. AII the NATO leaders even those who j ealously maintain the distinction between NATO as a military alliance and the European Economic Community as an economic forum—agreed tO coordi- nate economic reprisals through the alliance. "Our public opinion simply would not understand if this time we failed tO react on the economic front," said one NATO Foreign Minister. The Polish situation is the main reason for Europe's get-tough attitude, but not the only one. At the Conference on European Security and Cooperation in Madrid, the Soviets openly showed their contempt for Western concerns over human rights. Despite worldwide protests, they exiled physicist Andrei Sakharov and jailed several other dissidents. N0t a single soldier has been with- d rawn from Afghanistan, and the Russians have rebuffed every European effort tO negotiate a solution there. By November, French Foreign MinisterJean Frangois-Poncet was ready tO banish détente from his vocabulary. "Since Afghanistan," he said, "l れ 0 longer much like the word 'détente. ' I no longer feel it describes the over-all relations we have with the Eastern countries. ” lt was a startling admission for any French minister tO make especially since détente began with Charles de Gaulle in the 1960S. But it was indicative Of the turmoil that has beset European leaders in the past year, the sharpness Of their frustrations and the shift in their thinking. American critics Of European attitudes are inclined tO be cynical about such shifts. They point out that while French President VaIéry Giscard d'Estaing and West German Chancellor Helmut Schmidt described the Afghan invasion as "unacceptable," they continued tO dO business as usual with the Russians. ln a midyear interview, former U. S. Secretary Of State Henry Kissinger said that "certain Europeans have developed a new concept Of the division 0f labor in which they 100k after détente while the United States attends t0 defending the st. " As late as mid-December, French and West German banks were extending credit tO the Soviet Union for a $ 14 billion gas-pipeline pro. 」 ect that would increase European dependence on Russian-supplied energy through the 1990S. ut Europe was also sending signals Of another kind. France increased its defense budget beyond NATO requirements and cooperated with Britain and the United States in es- tablishing a naval force in the lndian Ocean. Britain, West Ger- many and ltaly have chosen sites for the installation Ofnew theater nuclear missiles t0 counter the Soviet buildup 0f SS-20 missiles. Giscard and Schmidt still must contend with important elements NATO t 「 00P5 0 れ ma れ・ u ・′ in West Germany: す h ・ shO 杙・「 m p 「 05P ・ ct was fO 「 a 5 0n9 ・「 AtIantic a a れ 0 ・ 32 Jacob Sutton—Gamma-Liaison NEWSWEEK/JANUARY 5 , 1981

き ! ート Afghan ins 「 9e0 彙 5 in a mountain hide-out: 'We have fought a supe 「 po 響・′ tO a standstill fO ′ t 0 ⅳ 0 months' after thirteen Khalqi army omcers were executed on suspicion 0 the Soviet occupiers and the remnants of the Afghan Army. of plotting a coup. At that point, the Parcham faction began 'We take our guns on the battlefield from the Russians," claimed a full-scale purge of its rivals from all top military and government Jamal Ahmad, who belongs to another insurgent group. positions. Despite dogged resistance from the insurgents, it seems likely that historic and geographic realities will dictate the establishment he incessant feuding in Kabul has had a predictable effect : of a leftist government in KabuI that is more or less sympathetic it has narrowed the base Of the Communist Party—preciseIy to 、åoscow ' s concerns. ln the meantime, the Soviets are digglng the opposite 0f what the Soviets had hoped for when they in for a long stay. A major depot for fuel and materials is under installed Karmal. By waging war on the Khalq, KarmaI has construction at Pul-i-Khumri, in north-central Afghanistan, and alienated the party faction that commands 60 per cent Of Com- the Soviets are laying a large 0i1 pipeline tO the area. They have munist support in the country. Outside the party the situation alSO extended the runways at four air bases ⅲ Afghanistan, built is even worse, because while it is unlikely that the Khalqi leaders huge aircraft hangars, constructed new housing for personnel and set up seven reglonal military commands Of division strength. would ever defect tO the non-Communist Muj ahedin insurgents, the same cannot be said of many of their followers. There have This is disturbing news for both the rebels and for Pakistan, already been rumblings of a Khalq-Muj ahedin alliance, and if smce the Soviets are bound tO step up pressure on Pakistan's the reports turn out tO be true Karmal's position may become President Mohammad Zia ul-Haq to force him to curb the exiles' untenable. That, in turn, creates still another headache for the freedom. MiIitariIy, the Soviets may also continue their frequent SOViet overlords and increases the likelihood of long-term oc- violations Of Pakistani airspace, and perhaps even resort tO hOt cupation. "lt has been clear from the beginning," said a Western pursuit 0f the guerrillas fleeing into Pakistan. ambassador, "that the Soviets' Obj ective ⅲ entering Afghanistan was t0 provide a securlty umbrella under which an Afghan regime OSCOW appears tO have ruled out any suggestion that the could rebuild all the country's institutions. There has not been United Nations send a fact-finding mission to the area. a shadow 0f progress. ' That, ⅲ turn, eliminates the possibility Of an interna- The prospect of cooperation between the Khalq and the Mu- tionally negotiated settlement. One Western intelligence source j ahedin is chilling tO the Soviets because the non-Communist believes the Kremlin may eventually see certain benefits flowing rebels have been a formidable foe even without any indigenous from the occupation. "The Soviet Army has not been bloodied allies. " have fought a superpower to a standstill for twelve for a long time," he said 、 "Afghanistan provides a handy, nearby months," claimed Najibullah Lafraise, a member of a Peshawar- training ground tO test weapons, tactics and troops in actual based lslamic insurgent group. Apart from small arms and 応 od battle. " Moscow's men and machines will probably pass—but supplies from outside the country, the insurgents have been living the test will take a 10t longer to finish than they had expected. Pascal Manoukian—Sygma NEWSWEEK/JANUARY 5 , 1981

Maggie Steber—Sipa-BIack Star 0 「 ban po ・杙 y in Haiti: す h ・ WO Bank and 彙 h ・ IMF bOth promised tO be mo 「・ 90 れ・′ 0 5 with す h ⅳ WorId ー oa れ 5 must provide long-term loans with less ngorous conditions tO give countries more time tO adjust. Commercial bankers have become much more involved With the more dynamic Third World countries, such as Brazil and South Korea, since they began lending them large sums in the early 1970S. Now, however, they are more apprehensive about their credit-worthiness in the face 0f higher 0 ⅱ prices. ln 1980 , they began looking t0 the IMF as either their guarantor or their debt-collector. Western bankers were ambivalent about clos- er links with the offlcial institutions, and some Of them feared that if they got guarantees they would also get interference. One banker commented: "Our policy is 'help, but hands 0 . The chief advocate of closer links with the IMF was (). W. ) Tom CIausen, president of the Bank of America. And in October, Clausen was nominated tO succeed McNamara as president Of the World Bank. One ofthe ma 」 or issues facing Clausen will be the determination Of the wealthy oil-producing states tO increase their voting power in both the World Bank and the IMF before they take a more active part in Third World development. TO that end, the Arab countries devoted much Of their attention during the year tO beefing up their presence in the tWO institutions. y the end 0f the year, the North-South deadlock, if not broken, was at least more confused. 市ⅱ e the ideologues of free enterpnse, such as Thatcher or Milton Friedman, insisted on the sanctity Of the international capital market, many bankers were not sure hOW sanctified they wished it tO be. Third ′ orld militants still insisted on drastic restructuring to achieve their "new international economic order, " but many Of them looked t0 Western investment and bank loans for help. StiII, the Third WorId's prospects for the 1980S remain full of uncertainty. The extension of both lending and aid depends NEWSWEEK/JANUARY 5 , 1981 critically on East-West relations and the cost Of the arms race. ln cynical terms, greater arms spending by bOth sides could stim- ulate economic activity and push up the pnce Of some Third WorId commodities—perhaps providing a new boom for several countnes, particularly in Latin America. But it would cut back the surplus funds available for international lending and aid not linked to military 0bj ectives, causing new hardships for Third WorId countries that produce purely peaceful commodities, or simply struggle t0 survive. any Third WorId leaders enter 1981 with renewed fears in the political arena as well. They worry that preoc- cupation with the Communist threat and the rhetoric of a new confrontation could lead the West back to crude cold- war simplifications, particularly the assumption that the whOle world must be classified as either pro-Communist or anti.Com/ munist. Past turnabouts in Asia and Africa, they note, have shown the dangers Ofthis assumption. Many newly independent countnes once lOOked tO the SOViet Union tO provide arms for their wars of liberation, only t0 become disillusioned by the inability of the Soviets tO provide the peaceful equipment they desperately needed later for development. Even among those Third World states which apparently had been moving closer tO Moscow, the SOViet invasion Of Afghanistan provoked protests and concern. The I ran-lraq war also has raised senous questions about which side is the least unfriendly tO Western interests. The events 0f 1980 showed the danger 0f generalizing about the line-up between the Third World and the Soviet Union. ln the months ahead, the challenge for both the West and the Third World will be to resume their dialogue with a heightened sense 0f urgency fostered during the last dangerous year. NEWSWEEK INTERNATIONAL CO れル″″れ g ed ″ 0 ′ / 〃 0 れア Sa 襯 2 $ 0 〃 0 ん 0 d the 召 ra れ市 CO 襯な豆 0 〃′ 0 な