CHAIRMAN
DR HENRY A. KISSINGER

COMMISSION MEMBERS:
MR NICHOLAS F. BRADY
MAYOR HENRY G. CISNEROS
GOV WILLIAM P. CLEMENTS, JR.
DR CARLOS F. DIAZ-ALEJANDRO
MR WILSON S. JOHNSON
MR LANE KIRKLAND
MR RICHARD M. SCAMMON
DR JOHN SILBER
JUSTICE POTTER STEWART
AMB ROBERT S. STRAUSS
DR WILLIAM B. WALSH

EXECUTIVE DIRECTOR
AMB HARRY W. SHLAUDEMAN

THE NATIONAL BIPARTISAN COMMISSION
ON CENTRAL AMERICA

SESSION ON SOCIAL DEVELOPMENT

September 7-8, 1983

WEDNESDAY, SEPTEMBER 7

10:00 - 10:50 - Overview

Edward Marasciulo, Executive Vice President,
Pan American Development Foundation (lead
consultant)

10:50 - 11:50 - Population

Dr. Loy Bilderback, California State University
at Fresno

11:50 - 12:50 - Education

Dr. Russell Davis, Littauer School, Harvard
University

1:00-2:00 Lunch Break in the State Department Cafeteria

2:00-3:00
Role of the Private Sector in Social
Development Policy

Ronald Scheman, Assistant Secretary for
Management, OAS

3:00 - 4:00 - Reflections on Aspects of U.S. Social Development Policy Toward Central America

Leveo Sanchez, Development Associates, Inc.

4:00 - 4:10 - BREAK

4:10 - 5:00 - The Peace Corps and Social Development

Ms. Loret M. Ruppe
Director, Peace Corps

SENIOR COUNSELLORS:
REP MICHAEL D. BARNES
SEN LLOYD BENTSEN
REP WILLIAM S. BROOMFIELD
SEN PETE V. DOMENICI
SEN HENRY M. JACKSON
REP JACK F. KEMP
AMB JEANE KIRKPATRICK
MR WINSTON LORD
SEN CHARLES MCC. MATHIAS
MR WILLIAM D. ROGERS
REP JAMES C. WRIGHT

7-8 Sept.

2201 C STREET NW. ROOM 1004, WASHINGTON, D.C. 20520 TEL: (202) 632-7804

DRAFT

To: Commissioners/Counsellors not able to be present at
September 7-8 session

From: Henry A. Kissinger

Attached for your information are summaries of the
presentations made at our meetings on September 7 and 8.

Summary of Presentations before the
National Bipartisan Commission on Central America

SESSION ON SOCIAL DEVELOPMENT

Day 2: September 8, 1983

The Commission met on September 8 at 9:00 a.m. to continue its consideration of social development issues. William Doherty, Executive Director of the American Institute for Free Labor Development (AIFLD), and Edward Marasciulo, Executive Vice President of the Pan American Development Foundation, served as lead consultants.

Commission Business

The Commission discussed a trip to Central America considering several options, which include a single group trip, trips by working groups, or a small delegation led by Dr. Kissinger. The Commission will meet at 9:15 a.m. on September 12 to hear final recommendations. Dr. Kissinger announced that Senator Inouye will replace the late Senator Jackson as a Senior Counsellor. Dr. Kissinger relayed an invitation made by the AFL-CIO to attend a special session in Miami on October 2 with President Luis Alberto Monge of Costa Rica and major Latin American labor leaders. Monge and others will be attending the AFL-CIO annual convention.

William Doherty: Labor Perspective

Mr. Doherty gave a capsule history of AFL-CIO activities in Central America, noting that the idea of a confrontation between the Soviet Union and the U.S. in the region is very real to the area's trade unionists. Doherty estimated that 70% of the region's top trade union leadership has been trained in the U.S.; the other 30% has probably been trained in Moscow. A prime goal of the free trade union movement in Central America is to ensure that the region's people have a voice in their government. Neither a return to rule by the oligarchies nor a Marxist-Leninist victory will give the people sufficient stake in their societies to bring about long-term stability.

Doherty emphasized the need to work with established
regional institutions to implement AIFLD's recommendation of a
5-year, $7.5 billion program of U.S. economic assistance. He
believes the U.S. people will support such a program, as they

supported the Alliance for Progress, if they are convinced the aid is reaching those who most need it. While USAID programs are beneficial, AID must maintain a government-to-government relationship which often results in economic assistance benefitting vested interests. The AIFLD recommendation calls for "watchdog" committees in the U.S. and recipient countries--made up of representatives from the Administration, Congress, and the business, academic, labor, and church communities--to oversee the use of assistance funds.

Doherty noted that the people of Central America support the democratic way of life. Their expectations for their societies have been shaped in large part by the U.S. media and, as they have shared so much New World history with the U.S., they want to share in the benefits of a participatory democracy that will be responsive to their economic needs.

Richard Hough (AIFLD); Prof. Roy Prosterman (University of Washington); Mary Temple (The Land Council): Land Reform

Mr Hough presented an overview of land reform. He described the problems of the landless, the tenant farmer, and the agricultural laborer as acute throughout Central America. Land problems contribute significantly to political instability, low agricultural productivity, and economic inequality. He explained that the modern world is governed by essentially two models: the collectivist approach of communist systems and the small family unit common in democratic systems. He called for the U.S. to embrace land reform not as a measure of last resort, but as an ongoing process for peaceful change in underdeveloped societies.

Dr. Prosterman devoted considerable attention to an explanation of the three phases of the land reform program in El Salvador. Phase I, the redistribution of land over 1,200 acres, has been completed and a system of compensation prepared. Phase II, redistribution of medium size holdings, has been deferred. Phase III, land to the tiller or small renter or sharecropper, has moved slower than expected. Prosterman noted that significant delays have developed because of titling problems and resistance by former land owners. Prosterman called for continued U.S. support for land reform and consideration of possible financial assistance to complete the program, including funds for compensation to former owners (which is now prohibited by U.S. law). The team of experts concluded that land reform is an important element in forestalling potentially explosive land issues throughout Central America.

Dr. Nevin Scrimshaw (MIT): Health and Nutrition

Dr. Scrimshaw began by discussing the involvement of the Institute of Nutrition of Central America and Panama (INCAP), and its contributions to the improvement of health and nutrition in the region. Malnutrition is a severe, often irreversible problem in Central America. Of particularly great concern is protein calorie malnutrition among pregnant mothers and weaning children. Scrimshaw noted the synergy between health and nutrition. Finding the root causes of health and nutrition problems in social injustice, Scrimshaw suggested promoting strong systems of primary health care and encouraging regional measures. He emphasized that solutions must come in a package and that individual actions may be a waste of money.

Edward Marisciulo and William Doherty:
Lead Consultants' Recommendations

Marisciulo presented both immediate and intermediate recommendations, including: rapid expansion of Peace Corps activities; the creation of a roving ambassador to deal with regional issues; closer cooperation with the Central American Bank; and coordination with both private voluntary organizations and the private sector in Central America. [See attached recommendations paper.] Doherty reiterated his call for a "watchdog" group to monitor the use of assistance funds and urged continued U.S. support for land reform.

M. Peter McPherson (Administrator, AID):
U.S. Government Reaction

Administrator McPherson was "reasonably optimistic" that social development progress could be made in Central America, pointing to the social revolution that took place in Costa Rica and Panama. McPherson reviewed actions taken by AID in this area and asked the Commission to view family planning programs as vital to the long-term objective of increasing incomes and the quality of life. Education and training are other areas that are important vehicles for social development, including non-formal education and literacy campaigns. Primary health care, oral rehydration efforts and malaria vaccine research contribute to social progress. A particularly difficult area is the growing urban population that is getting larger and receiving a shrinking share of social service resources. The

overall context, he indicated, is to promote and expand
democracy, including the establishment of legal systems, human
rights, and other variables that promote broadly based social
and economic development.

Administrator McPherson emphasized the need to focus attention on delivery mechanisms--such as private voluntary organizations, indigenous private sectors, labor affiliates, and U.S. Government organizations such as the Peace Corps. U.S. assistance, he argued, can only be effective if the host governments take necessary actions in the area of policy reform, by institutionalizing appropriate technology, and mobilizing the private sector in order to ensure effective use of finite resources.

JB #0270B

9/8/83

Summary of Presentation before the
National Bipartisan Commission on Central America

CIA BRIEFING

September 8, 1983 (4:50 - 6:00 p.m.)

The first topic discussed was the strategic importance of the Central American and Caribbean basin region to the U.S. in terms of the trade routes used by American imports. This was followed by an overview of the Central American insurgencies. The geurrilla forces operating in the region were compared as to sizes and abilities with the armies against which they compete. The level of economic and military aid to Nicaragua was discussed at length. The economic aid originates primarily in the West and is falling. Military aid comes almost exclusively from communist countries and has risen sharply this year. Detailed discussions of the internal situations in El Salvador, Nicaragua, and Guatemala covered democracy and the electoral scene, economics, human rights, and security issues. The stability of the regional governments was also assessed. Many of the questions posed by Commission members focused on the guerrilla war in Nicaragua.

JB #0270B

9/8/83