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people a slightly larger measure of "the good life," both in terms of consumer goods and social welfare benefits. At the same time, he has opted for a somewhat greater degree of centralized control of the economy. In external affairs, he differs again by degree: conforming more fully to Soviet wishes, acting friendlier towards other Warsaw Pact states, and generally avoiding throwing his weight around in East European affairs. In party matters, he proceeds cautiously, in the process slowly replacing incumbents with his own men. As a lifelong bureaucrat and longtime heir apparent, he seems to have learned his lessons well.

Unlike Honecker and the bureaucrats now in office, there is no certainty that the younger generation, which will inherit the system, will conform to established practice. Self-confidence and pragmatic, the new men seem willing to accept the concept of socialism nominally, but then operate according to the dictates of reason. An infusion of more youthful, less rigid personnel into positions of power conceivably could eventually tip the balance in favor of a society sufficiently liberalized and an economy sufficiently Westernized to permit an accommodation with West Germany. Such a result is hardly foreordained, however. The probability remains that the liberals of today will be the conservatives of tomorrow; and by the time they assume power, they will be prepared to march in lock step along the Ulbricht-Honecker course.

On balance, the East German regime has reason to believe that developments in the near term may be favorable to its interests. In effect, it has built its own house. To a considerable degree, it has gained acceptance at home and abroad. Overall, it feels that time is on its side, particularly as expectation of a return to

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APPROVED FOR RELEASE: 2009/06/16: CIA-RDP01-00707R000200110020-1