From the mid-1970s to the eve of Gorbachev's assumption of party leadership in the spring of 1985, the CIA portrayed a Soviet Union plagued by a deteriorating economy and intensifying societal problems. CIA products described the growing political tensions resulting from these failures, the prospect that sooner or later a Soviet leadership would be forced to confront these issues, and the uncertainty over what form this confrontation would take.

These products include the unclassified testimony from each of DCI Admiral Stansfield Turner's annual appearances before the JEC from 1977 through 1980 (Appendix A, references 1-4)-part of the ``annual public reports'' cited by the HPSCI Review Committee. Turner's testimony and the written submissions for these hearings described a ``bleak'' Soviet economy for which continued decline through most of the 1980s was ``inevitable.'' The hearing reports include:

• CIA descriptions of how badly Soviet economic performance lagged behind that of the West and the prospect that Soviet leaders would be forced to confront growing conflicts between civilian and military uses of resources and investment.

• CIA assessments that the Brezhnev leadership recognized the potential for larger political repercussions from the economic failure; that the Brezhnev regime (and possibly even an initial successor) was nonetheless likely to attempt to muddle through rather than confront the politically difficult choices necessary to deal with the decline; that muddling through was not a viable option for the longer term; and that by the mid-1980s the economic picture ``might look so dismal'' that a post-Brezhnev leadership might coalesce behind policies that could include ``structural reforms.''

Other unclassified CIA publications disseminated in 1977 and 1980 (Appendix A, references 5 and 6) presented the same picture of a deteriorating economy that ultimately could provoke more radical policies.

When Gorbachev assumed the Party leadership, the analytic questions ``were not whether (he) faced a deteriorating economy and major societal problems'' but ``what would be his plan for dealing with them?''

From the late 1970s through the early 1980s, CIA produced several papers addressing the prospects for ``serious economic and political problems'' arising from the combined effect of growing consumer discontent, ethnic divisions, a corrupt and incompetent political system, and widespread cynicism among a populace for whom the system had failed to deliver on its promises (Appendix A, references 7 and 8 and 10-13). One of these, for example, described the problems stemming from ``long continued investment priorities favoring heavy industry and defense, coupled with a rigid and cumbersome system of economic organization'' which ``have combined to produce a consumer sector that not only lags behind both the West and Eastern Europe, but also is in many ways primitive, grossly unbalanced, and in massive disequilibrium'':

• These products portrayed a Soviet leadership caught in a descending spiral: declining productivity was depressing the economy, which aggravated the cynicism and alienation of the populace; this in turn further reduced productivity.

• CIA concluded that this ``vicious circle'' was potentially more significant for the 1980s than ``anything the regime has had to cope with in the past three decades,'' and that the leadership and elites were fully aware they confronted major problems.

• The analyses repeated the judgment that the Brezhnev regime and the Andropov/Chernyenko successions were likely to rely on the traditional Soviet instruments for controlling unrest and imposing ``discipline'' but that such approaches would not hold for the longer term in the face of a Soviet populace that was becoming less pliable and more demanding.