The Presidential Years 363
hotels and catering companies kept just 15 percent. The rest went to the central
banks in Belgrade, from where it flowed through different channels to several
large financial institutions that dominated the Yugoslav market and the entire
import system.^542 Add to this a scandalous distribution regime for hard cur-
rency that favored a sort of black market in which the direct producers had to
buy back, in case of need, the money they had earned themselves. The Croatian
and the Slovenian economies were the most closely linked to the West and had
brought in large amounts of money, above all thanks to tourism. This mecha-
nism caused great frustration among the people, who were convinced they were
being robbed by their own government. The Croats became more and more
insistent on having a so-called “third nationalization,” which would allow the
self-managed organizations to administer whatever capital they acquired. And
this, so they said, would boost the economy of the entire federation.^543
The Croatian requests were initially supported by Edvard Kardelj who had
spent a great deal of time working on constitutional amendments to curb the
power of the central administration and strengthen the economic and political
rights of the republics.^544 In a session called on 8 July 1970 to discuss these
questions, he declared that it did not matter to him whether Yugoslavia was a
federation, a commonwealth of states, or a confederation: the most important
thing was agreement between the different nations about their common inter-
ests. This should be handled by the Federal Assembly, all the rest should be left
to the republics.^545 The following October, he published his third proposal on
constitutional amendments, presenting it as a new institutional pact. In his
view, sovereignty lay with the republics, while the federation should only take
care of defense, foreign policy, and the unity of the socioeconomic system. But
these tasks, as well as the appointment of federal officials who were in charge
of implementing them, should be achieved in agreement with the leadership of
the republics.^546
At the same time, Tito and Kardelj decided to establish a presidency of the
SFRY that would be able to lead the country after the marshal’s passing. Tito
spoke about this in public during a televised meeting with the Zagreb LCY
on 21 September 1970. He announced the creation of a collective body that
would function as head of state, although it was clear that he had no intention
of relinquishing control. He spoke off the cuff, without notes, appearing fresh
and alert, demonstrating his mastery of the situation.^547 His calls for harmony
were unsuccessful, however, not just in Croatia but also in Serbia, where dis-
content was spreading because of the planned constitutional amendments,
some of which would guarantee substantial autonomy to Kosovo and Vojvo-
dina, the two provinces of the republic. In Belgrade, people were saying that the
constitution should not be changed continually, and that important issues like