JPRS ID: 8362 TRANSLATIONS ON WESTERN EUROPE

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JPRS L/8362
30 March 1979
TRANSLATIONS ON WESTERN EUROPE
CFOUO 19/i9) . ~ o
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3d Mdreh 1.9 79
TttANSLATIONS ON WESTERN EUEtOPE, (FOUO 1.9/79) d,
~
7. Auehut(e) 8. Petfotmin~ Or6~ni:uion Rept.
No.
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JPRS L/8362 _
~ 36 March 19 79
TRANSLATIONS ON WESTERN EUROPE
(FOUO 19/79 )
CONTENTS � PAGE -
AUSTRIA
Chancellor Diacuasea Domestic Situation, Middle East
(Bruno Kreiaky Interview; STERN, 16 Feb 79) 1
FRANCE
~ Soviet 'Multinationals' in Weat Diacussed
(Francoie Lebrette; VALEURS ACTUELLES, 5 Mar 79)......... 16
Shipyards Building Subsidized Veasels for Poland
(Agnes Rebattet; L'EXPRESS, 10 Feb 79) 20
Rocard's Status in PSF Weighed
(Kathleen Evin; LE NOWEL OBSERVATEUR, 12 Feb 79)........ 22
WEST GERMANY
Foreign Office Secretary Discuases World Economy
(Guenther van Well; EUROPA aRCHIV, 10 Feb 79)............ 25
Debts, Finances of Major Parties Examined
(Wolf Perdelwitz; STERN, 1 Feb 79) 34
- a - [III - WE - 150 FOUO~
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AUBTRIA
CNANCELLOR DISCU35ES DONIESTIC 3ITUATION, MIDDLE EAST
Hamburg STERN in German 16 Feb 79 pp 85-g6
(Interview with Bruno Kreisl~y, chancellor of the Federal Republic of Aus-
trie; ci~te and place not givenJ
(Text] Kreisl~y, Bruno; born on 22 January 1911, son of an i.ndustrial man-
- n,ger, Realschule graduate; law student; graduation us doctor of laws. A1;
the age of 15 entered Socialist Worker-Youth; at the sge of 25 condemned in
' the so-called "Socialiat Trial" for high treason; in prison for 22 months, � -
after that in Sweden as a refugee from the Gestapo. As an emigre Kreisl~y
organized resistance against Nazi domination in hia homeland. After the war
- he entered Austria's diplomatic service. In 1953 he became secretary of
state in the Office of the Federal Chancellor; forefgn minister in 1959 and
in 1970 federal chancellor.
Todqy Kreisl~y, a workhorse of the Socialist Party of Austria (SPQe) is oldest
in service of the government chiefs of Europe. The chancellor of the small
republic, which is ind.ependent of the big power blocs, has great intexna-
tional influence. Together with Willy Brandt a.nd the Swede Olof Palme he
leads the "Socislist Internatiotiale." Kreisl~y, scion of a Jewish upper mid-
dle class family, has had garticular involvement in Near East politics--usu-
ally on the side of the Arabs.
In November of last year the self-rsware statesman suffered a defeat in the
nationnl plebiscite on the introduction of atomic energy into Austria:
Kreisky was for it and 51 percent of the people were against it. The vet- _
eran tactician swallowed this political re~?erse--and had himself designated
as the "general plenipotentiary" of his party. Kreislty's latest gambit: he
shifted the national ele~tions; originally planned for October of this year, -
to an earlier date by a half year in order to e~cploit his present popular-
ity. On 6 May Kreis~y wants to enter his third period of office after an
election victory: "I want to remain federal chancellor until 1983."
The STERN reporters, Juergen Petschull and Kiaus Liedtke, talked for all of
6 hours with the! regent of the Danube reFublf.c about: socialism a la Aus-
tria, Kreisl~y's at~ftude toWard his Jewish past, his controversial attitude
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~'OR O~FICIAL U5~ dNLY
toward THrael, hio relationohip to neighboring West (lermany and East f~er- -
mau~~yy, to his sott and to handmade Auetrian foot gear.
He'd Like To Be Juet a Little Bit Marxiat
.
STERN: Herr Chancellor, you are considered to be the "pureat Socia]. Demo-
crat in Europe."...
- Kreiaky: I like this d~acription--hut my friends, Willy Brandt and
Olof Palme, and many others have e~rned at least equal merit for their ser-
vices to international aocial democracy.
STERN: But after 8 years of official. aervice as chief of government of the
Auatrian Republic you arp also being decorated by friend and foe with t3-
tles which are not quite so appropriate to a Bocial Democrat--but more be-
fitting a monarch. You are called "E~nperor Bruno I" or "The 5un King."
Kreisl~y: I consider that enormously stupid, but during my life I have had
to deal with so many stupidities that I have learned to get al~ng with them.
STERN: You are bothered when people ca11 you author�itarian?
Kreisky: Out of deepest conviction, since I have been able to thi.nk politi-
cally, I have been a Social Democrat. I want to make social democracy a re-
ality in u~r country, which means: to confer ugon the individual citizen the
most far-reaching franchise and responsibi~.fty. This can hardly be called _
authoritarian!
STERN: Though you mey not be authoritarian yet you are an authority. Your
reputation as a statesman and also as a political tactician corresponds
within and outside Austrie approximately to that of Adenauer in his best
time ir~ the Federal Republic of Germany.
Kreisky: The comparison is a little lame: I come oui i political camp
opposite to that of the conservative Adenauer. To be sure, it often hap- .
pens--I am very sorry to sq}r this--that people of the classical bourgeoisie
say: "The trouble is you are in the Wrong party." But that's a completely
Wrong inference. I co~ild never have been a member of another party; I xould
rather iiot have been :i politician at all. For me my primary impulse has always
been to change things; for ms that vould have been impossible in a conserva-
_ tive party which at the best only xants to do some retouching; nor would it
have been possible among the i3.berals, Who think that the World in xhfch we '
live is the best of all possible worlds. Maintenance of ;he status quo
would have offered me no ,~ustification for going into politics, for this
sacrifice of a11 private life, of leisure, this readiness to submit oneself
to everyone's public criticism, to be ~udged all the time by people Who are
frequently unable t.; ~udge anything--these things are not very pleasant.
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,
"Wtbh }2e~nrd to Schmiu'..; T Am u Little M~.n in Comparison"
:3'r~RN: }low did you get irito politics7 What was dr.c:iyive for ynu here~
the impt.ilse to improve the world, altruism, a need for power? .
Kreisky; I can answer thnt only in a historical c~ntext. I come frocn a -
k~ourgeois family. In 1927 out of genuine conviction I entered the Socialist
Youth and then occupied a trusted post in the Worker Youth. At that time,
for reasons of principle, we didn't want public offices for Social Demo-
crats. (~(y strongest wish for ir~yself was to become a,journalist in a party _
nekspaper and to be able to mold opinion. In the fascist period our lot was -
persecution, imprisonment, emigration. A1so I was in ~ail'for 22 ;nonths and
,~ust like Wi11y Brandt and other German Sociel Demncrata I emigrated to Swe-
- den. We adhered to our way of thinking and after the collapae of fasciam,
- we returned with our wqy of thinking. `
STERN: Are you really a 5ocial Democrat or a Socialist? ~
Kreisky: For me sociel democraey and democratic socialism are equivalent
terms. T certain~y do not think of socialism the way the communisi;s do, who
believe that they have made it a reality at the moment when they aeize power. -
For me democratic socialism is a political, principle, t~ goal and not a con-
crete form of society. This involves especially that questfon which must be
repeatedly asked, namely, how much can ar,d mqy society do for the individual
without destroying his individuality?
STERN: In other words, not total state planning and providing? ~
Kreisky: By no merins. A Democratic Socialist may not say: I relieve man
of a maximum of responsibility for society and f~r his own life but rather I
confer upon him a maximwn of responsibility for society and hence for his
- own existence.
STERN: hir Chancellor, we are interested in knowing the extent to which
y ouu have translated your cunviction into practical politics. Now, for al-
most 8 years you have been a part of the government. With what sort of bal-
ance do you mean to appear this yeur before tt~e voters and what Would be the ~
looks of ~ direct comparison between your politics and that of the Federal ~
Republic oT Germeny under the luttei�'s social-liberal leadership?
Kreisky: I'm inclined to think they cannot be compared in that way. Helmut
Schmidt has incomparably greater and more difficult problems to deal with
than I do. This is a difference corresponding roughly to the diff~rence in -
the populations; you have 62 million people and we have almost 8 million. -
By compurison I am a little man....
STIIiN: Modesty is an affection
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- Kreisky: here I am on the Vienna Ballhausplatz, sitting in an o1.d
t~ouyc which dntes from the dqys of the monarchy. A1.1 th~t sort of th3ng is
really a little b3t too much for the meana at our disposal today. That's
why I often see ~self as someone who has inher3ted a gigantic castle and
whose resources are ,~ust aufficient to furn3ah a single wing of the bui~d-
ing. To the latter extent we have been quite aucceasful.
STERN: You have furnir,hed your house in accordance with social der~ocrat3c
ideas. Of which of the interior appointmenta are you especiQlly proud2 ,
Kreisl~y: First erid foremoat: it is naturally a prerequ3site to the reali-
- zation of social dem~cracy that one should have aome influence in the econ-
o~r or upon the econo~. Anyone lacking that must fail. We have auch in-
fluence.
STERN: You have nationalized the econotqy.
- Kr^eisky: Partially� That heavy industry, the energy economy and the big
banks belong to the state, to the people, is not to be entirely credited to
us. Since the war even our conservative opponents i.n the people's party
have worked with us in this direction. Besides, for us "nationaiized" never -
means "expropriate" because as eexly as the thirt~es Austrian ~r~pit alism had
collapsed. After the war its scanty remains had become ownerless property
and were finally taken over by the state. Moreover, I do not consider a
fully nationali2ed econompr to be the ideal form, but prefer rather a mixed
econo~y; a healthy mixture of privately and nationally controlled econoud.
We Social Democrats are now by no means "leftist dreamers." We alreac~y
clearly recognize that a welfare state can be supported only by a modern
successful industrial state. We have made Austria into a modern industrial
state. We have only about 2 percent unemployed, in other words we have full ~
employment and our inflation rate is now 3.5 percent. We may confidently
present such a record to everyone's inspection. _
STERN: And in the past year, in terms of the individual worker, you have
had only 20 minutes of strikes....
Krei3ky: I am sur'e that figure is exaggerated. That is much too big.
Just r: moment--I'll have somebody check that right now. (Picks up the tele-
- phone, asks, "Hello, how much lost worktime dir~ we have last year as a re-
' sult of strikes? Would you kind~y find out?") So, they ~ust said that we
had less than 1 minute, about 20 seconds, but we'll get the exact figure !
right away.... (Telephone rings. Kreisl~y sgeaks with a s~~ecialist.) Al1
right, now I have it exactly: in 1976 the striking ti.me of workers in Aus-
tria totaled 6.3 seconds. In 1977 we had 0.1 second of striking.
ST~RN: That seems to be the absolute world record. How do you cal.culate
this figure after the decimal point?
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Kreisky: In 1977 in the Ra~lio Uispatct~cr OEf:icE for taxts in Vienna, 43 employeea
stopped working fbr hours. Converted to an annual basis and to the total
- working time of a11 emplnyeea this comes to 0.1 second. -
STERN: And so total social peace prevails in the Republic of Auetria. Has
the cl.ass struggl~ been done Awey with?
Kreisky: Not entirely, but we have conferred upon employeea no~t o~.~ly codeterminaT
tton but also coresponsiUility and therefore--and of this we are proud--we
have a functioning social partnership.
STERN: How does it function?
Kreisky: We have regular contacts between the socially and economically
relevant forces in the state not on].y between the tariff partners.
_ ~
_ STERN: In other words a sort o~' permanent].y concerted national-eeonumte ac-
- tivity2
Kreisky: What we h ave is not in ar~y sense institutional. The strength of _
- our system lies in the f~ct that we have strong trade unions whose atrength,
however, consists in the fact that they know k;~at they may reQSOnably expect
- of the other side. -
STERN: The other side--by that you mean private and state employers?
' Kreisky: Yes. In this situation everyone considErs whether in critical
situations he ought to leave the negotiating table and in almost a11 cases
he doesn't leave it because he knows very well that he must return to the
table. And so what is tne use of needless threatening gestures? Each side
knows the other's strength. It is a situation similar to that of the super-
_ powers in world politics.
STERN: In other words there is no longer r;r~y class struggle in the classi-
cal sense?
Kreisky: Once, borrowing a term from psyc;;:,analysis, I called our system a
sublimated class struggle. It is now a matter of distribution struggles
among the aggregate of workers. In this distribution, besides weges and -
_ sal~ries and entrepreneurial profits,the prices of the goods produced are
nAturally ,just as impnrtant; because in the end what matters is what one can
bu}r in the market for the earnings of his labor. And we must take care that
no one shall get ror his money too many packages containing goods which are
inferior or small in quuntity. ~
STERN: A state consumer protection in other words?
Kreisky: We have passed laws protecting the consumer. That seemed to me to
be urgently necessary for althougli it is ti�ue that thanks to the power of
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the trade union the exploitation of the labor force has dimtniahed neverthe-
lesa th~re has ~rit~en and there is atill ar3sing Q new problem which I once
, wen~t so far as to c~ll "exploitation in the marketplace."
STERN: Meaning that you want to slaughter the sacred cow known as "free
market econo~" in Austria piece by piece?
Kreisky: No.
STERN: Somewhat like wag~ and salary rates, among you also prices of basic
nutrients such as, for example, bres.d, milk and meat, are negotiated between
producers and conaumers. `
Kreisl~y: Between reprESentatives of producers and representatives of con-
sumers, yes.
_ STERN: A year ago you introduced a 30-percent luxury tax on imported goods.
Kreisky: Not on all goods. A 30-percent ac'~i~ri value ~tax on goods of the
- highest standard, which are in Austria imn_+twted ~;oods such as automobilea,
furs, ~ewelry.
STERIV: What does the state do with its surplus revenues?
- Kreisky: With them we try to impruve our foreign trade balance, but espe-
cially we finance socially useful tasks such as environmental protection,
hospitals, c'~rinking water supply, etc.
STERN: To use a somewhat toucY~}r expression: Are you, in other words, on
. the best road to state planning of the econo~r?
~ Kreisky: We plan the prosperity and the future of our ~ountry and its peo-
ple; this often neces~itates state interventions and controls. In other
words we have ~ framework planning economy which leaves the free entrepre-
neur a maximwn of liberty. It is certainly the task of every government
which is conscious of its responsibilities to create hedges against threat-
ening and coming crises. You see, ever since I have been in charge I have
stood like a watchman on a tower and have at all times been on the watch for
crisis symptoms,... wherever there is a cloud in the sl~y. Then, I called to
nqr friends: "Friends, a crisis is coming, we must do something to deal with
itl" I woul.d rather warn too much than too l.ittle because if I were ever to ~
overlook a symgtom then people would sey rightly: Wt~y did you put Kreislqr ~
- up there in the tower? '
STERN: But you seem in spite of your foresight to have overlooked one
thing: you wanted to put the alreac~y finishe~ atomic power plant in Zwenten-
dorf into operation but the people have voted against it with a vote which -
while bare~y 51 percent was nevertheless a sufficient~jr clear mandate,
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Kreisky: I have for 20 yefirs been dealing with the question of nuclear en-
ergy. Only a few years tsgo I was sti11 no friend of atamic power; but after
, ~ong thorough study of the really difficult and p~nderous sub~ject matter,
after numerous conversations with internotionally recognized specialists I
- have came to the conclusion that atomic energy is the only economieally ra-
tional, environmentc~lly acceptable and rel3able source of energy. It was
only after that that I supported the introduction of atomic ener~ into Aus-
tria.
STERN; Then wt~y didn't you assume responsibil.ity for it? You certainly =
have a ma,jor3ty in par�liament and you could have put through nuclear energy
without a referendum on the part of the publ:ic.
= Kreisky: I have alreac~y said; a meximum af responsibility for man is the
moet important gnal of social democratic politics.
' STERN: One of ttie citizens to whom yeu have assigned this responsibility is
_ numed Dr Peter ICreisky--your son. He has spoken at public meetings against
your nixclear energy policy. Does this represent a split in the family? _
~ ~
Kreisky: That rqy son has views other than mine I can nat ural]y not complain
about and I sha11 certainly not forbid tiim to express his opinion openly. .
But there is one circumstance which certainly does not please me: when, for
example, many hiindreds of people come to an antiatom demonstration in Kl.agen-
furt not because somebody named Peter Mueller is talking there but because
Peter Kreisky is talking there! They en,joy the exciting feeling that the boy
is makin g an appearance against the old Kreisky. But that is more his prob-
lem than mine. That's somethin~; that ~e must deal with.
STERN: Isn't it simply demanding t~o much of the citizen to have a plebi-
scite on atomic power since cert ainly hardly ar~yboc~y has enough expert knowl-
edge for something like this in which even experts are not in agreement? In
other words why have the responsible politicians imposed this burden on the
citizen and not themselves decided upon a"yes" or "no?"
Kreisn;,~: Once again I say: I huve fought for atomic power and at the same
time fought for holdinQ a popular referendum....
STERN : And you st.~f'fered a de feat .
Kreisky: I certainly won't cleny that. The decision went against me. Cer-
tainly that is a ciefeat. On the other hand I was the first in Austria to
bring about the referendum. 1~or that I am given a high score even by those
innumerable citizens who voted against nucleax energy. For if we hadn't done
that, but had pushed such a portentous decision through simply by a bare par- -
liamentary ma,jority, then the next election would have turned into an emo-
tionnl]y loaded fright electiori centering on the question of nuclear power.
In such a case there would no longer be ar~y voting on the issue of the fur-
ther course of our successful social democratic politics. I didn't want to
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_ wreck a11 of that with the Zwentendorf probleml And so, in accordance with
the wi11 of the people, we are no~~ passing a law forbidding the use of nu-
cler~r power. Th3s law could be suspended only through a new national plebi-
. scite. Thua the topic has bee?~ got out of the w~y.
STERN: But in ao doing you seem to have developed a patent method of hold-
fng on to government power if you are going to use a national plebiscite to
_ eliminate prior to an election every topic which may be critical for ~ou and
your party. ~
Kreisl~y: Tel'1 me, what do we mean by democracy? What is the better way of -
- de&ling democratically; to strive at all times to be in accord with the pop-
ular ma,~ority or to ignore it? It is not democrac~? to have uninterruptedly
a semicivil war in the country, uninterruptedly to ..~,ve the police armEd for
= warfare with tear gas and hoses against marching demonstrators. Such a -
state of affairs is in ~ view much more dangerous for democratic government
than bowing before a national referendum. One can't limit practicing democ-
racy only to democratic holidays every 4 years during an election.
STERN: The Aus;,rian popular vote against atomic energy ha~ int~rnationally
lerge psychological effects, perhaps even practical effects. Do you believe ~
that other governments of countries in which atomic energy is likewise the
sub,ject of dispute will follow your example a.nd a11ow their people to make `
the decisinn?
iCreisky: I know that ~{y friends and colleagues outside are saying: For
God's sake, whe,t has Kreisky been doing to us again? Yes, but allow me to
state clearly: I have no recipe for others. I am.not about to get ~r col-
leagues' chest;~uts out of the fire; it is iqy concern to carry out a policy ~
in Austria which guarantees a maximum of social tranquillity and franchise.
STERt1: What are the economic effects of the prohibition of nuclear energy?
_ In a couple ~f years will the lights go out in Austria?
' Kreisky: The lights will not go out, but it will have laxge economic conse-
, quences naturally. In Austria we have a petroleum reserve of 30 million
- tons. During the lifetime of a single nuclear power plant such as Zwenten-
_ dorf we would have been able to generate a quantity of energy corresponding
to this entire oil supply. Another figure: if a positive vote on our part
tiad served to give a start to about 50 nuclear power plants in Europe which '
are now ur:der construction or planned, then that would have saved a quantity
of oil tunounting for the oil producing countries to a loss annual]y of 50
billion marks. From this one can draw the conclusion that there are not '
only capital interests behind nuclear power, but there are at least equally
massive material interests lined up behind the prevention of nuclear power.
OPEC is not indifferent naturally to the question of wheth~r or not we can
liberate ourselves from their encrmous monopoly?
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,
- S~~iN. Meuning, that the Krpisky government has involuntarily r~nd~red gn
_ in~~timable flerJi_ce to t,h~.~ oil producin~ count.ries7 -
.a Kreiqk~�; I would not ~a;r rhat. Cert~inly it i~ not only the oil proflucing "
cou7trieu Which ~re ve:�y intr.~�e~ted in the outcame ni' ref~rendum~ ft~r or
a~ainaf, nuc.lear ~ner~yr, but, ~l~d the We~tern oil comp~nies.
S`I'E~N: ~tr Chancel~or, r he nation~l referencium on the Zwentendorf Atomia
~ow~r plant w~s in other Nords, to udopt your estimate of the matter, e kind
of advunce partial decision ;or the I'?ustrian elections o~' 1979� In other
~+ords a bnd omen. It was tiot the only such omen in rc�cent dqys: your party
cut a rutt~ei� pooi� figure in the elec~ion3 in Vienna and in Steiermgrk; the
pE~rty had t,rduble in connectinn with the ~ob of the commissioner of Austrien
tclevi~ion, the office being filled aguiast your wishes by the coneervative
Uerd I3acher. You are }~aving trouble with your "crown prinre," finance minis-
' t,er Androflch, bec~au~?~ he is conducting a tax con~ultation business on the
~id~....
Krei:~i:y: buL nou yau'rA paint,ing everything deep blgrk--~uat like the
Austriun Neople's Yarty.
Sir:R,i: We hove 3us~ ~ee~ rer~~in~; the Vienna neaspapers.
Y,rei:,ky: That's What I Lhoi~~~; almost s.ll of them think it's their task to
topp2e the ~overnment.
S'i'~Rii; i3u? the nexspr:F~c~�s e.iso rnz~ry checrf'ul nesrs, for example, th~t you--
r~,~d thi:, pleases uli the ~:itiLens--uant to control the bureaucrgcy more rig-
idly.
Krei~'r.y: `I'ne out~ro.rths o: the bureaucracy! IL is precise~y fn a youag
dem~crficy : ike tnaL c f~us :;�;a Lhat functionaries and officials have a rel-
tstively mrir}:ed tendency Lo ~.cquire a nap,isterial odor. I don't like that
.~nd i_t must be ch~n~ed. ~;inctionaries and officials are not lords over the
_ citizen~ but are oblfpn~ed to provide ~ervices to the citi2ens. Fo~� this
_ ro~r~n �.re r.nve, 1'or excunplc-~, created a eomplaints of�ice called the "peo-
pie'_ atto:ney." inroa~:~ thi:, ofi'ice the citizens can make eo~plaints when-
c~ver in tt;eir opi :ion the, hfive be~~a improperly treated by bureaucrats ei-
L7er materiqlly ur wi~,;; : Frsj~f~^'; t~ procedure. The mere fact that such an
effective comp~aint ri~~thorit~ ~xists and that all officia?ls and funetioa-
aries nre obli~ated ta kc~~F~ tnu. auLhority informed by it3elf has a psycho-
logicFilly v~ry po~itivf~ ~;fert upon the relationship bets+een the bureaucracy
und t,he citizens.
"The Red Cut in Lhe ~a~r, }if;_ iseca Deed f~r a Long Time"
STER,~: Are Soriril U~r~;,~ra~: in Au:,*ria, like their fellows in Cermaqy, con-
tinuousi~ being pr~sen`.ed uiLh poliLicKl pl~stitudes like "Freedom or Social-
ism"--~n elec* ion ~ l~~; ~sn of `he CDU, anich moreover ~+as thought up by atz
Austrian, by the ORc coc.~,is~i~ner, Gerd Bacher?
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~ Krei~ky: 'The Augtri.an peopl~~'~ F'arty nev~r wa~ ~qu~~miyh in th~ir Chaice of `
methodg. ~'or pxrimple, nnc~ they used an el~rtion pogter whirh shoWed e So-
ciali~t ~,ith a bc~ekp~ek artd in the backpgek Wa~ ~ red cat. 4'he cat aas in-
- ten~ied to symbolize bulghevi~m ~nd the rrh~le thing Was intended to aseert _
that the Auatrign Socialiats ~fter the election aould let th~ bc~lshevi~t r~t
= out of the b~g. But the voter is not quit~ ao dumb mar~y 13ke to beli~ve--
neither your votera nor ours. Th~ red cat, 3n oth~r Word~, ha~ b~en dead
for a long time.
STF~2N: no pr~~udices gtiii exist amon~ you sucti og those ahich continue to -
- be widespre~d amongst us, for example, t;he b~lief that Social. Democrats and _
Socialists wunt "to take our granc~y's little house awqy from her?"
~ Kr~inky: We reglly do still h~ve tihat ~ort of thing. I'm glad you men-
tioned it: sinCe ae have been in the gnvernment w~ hav~ eofingnced n~tion-
a11y more than 180,000 private~jr o~med hnmeg and privately okn~d ~p~rtm~ntg.
Md while the threat hsd been held up to the fnrmer~ that we Socigl Demo-
crats Kou1d drive their last cow out of the stall tode~y the problem is pre-
ciaely the oppoeite--todqy ae have too mar~y cor+a in Austrian agriculture. r
STERPi: You er~e one of the leading intexnstion~l Social Democrats end are -
- reputed ta be an expert on the Near East. You have more friends in the Areb
world than in Isruel although you are of Jexish origin. You have criticieed
the state of Israel ao vigorous]~y that you have even been reproached With
anti-Semitism. -
Kreisky: Before I come to speaki.ng of the Near East problem I must et the
outaet sqy something about mp? Jexish origin....
STERN: In newspapers and archives one cnntinuous~y reads "Bruno
Kreisky, Austrian char?cellor, Jew."
Kreisky: You knot+, that is the posthumous victory of Naziism which le~vea
the yellox star still hanging on cin individual even up to the present de~y.
ThaL is the posthumous victory of Hitler except that people no longer im-
mediately think about annihilating the individual involved. What is the
point of the xhole thing? What is the difference betWeen the origin of a~r
fumily and the origin of any other Austriar,?
.
STERN: Wt~y did you leave the Jexish religious community?
Kreisky: Because I am an agnostic.* Some of ~yr ancestors, paternal and ma-
ternal, did the seae Lhing.
* Agnosticism is b.~:~ed on the principle Lhat one cannot knosr ar~ything of an
absolute being or god and hence the question as to his existence must remain
undecided.
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Sm~~N: And yet under r~ntion~l sociali~m you w~re p~r~e~uted a Jev ~nd
put in prison.
Krei~ky: mhat ig ndt c~~c~ctl~~ ri~ht. I Wu~ not peraecuted as a Jex but as a ~
Sorinli~t .~'or that reuxon ~arly as ~.935 I Wng persecuted, condemr~ed at~d
incarcert~ted by Au~trtan clerico-t'~isci:;m xhirh wg~ not ~ttti-8emitie. In
193~, immediat~ly after the eytab~.ishment of Hitler dominanee in Auatria, S
wc~s ~ailed by the Gentapo ns ~n il~egal S~riuligt. On1y gfter montha in
pt~ison ~ w~s forced to leave the country. ~
S'~~FtN: Nevertheless, don't you feel yourself to be parLicul~rly bound to
the comman JeWish destir~y? Certainly, nuir~yr members of your family vere also
p~rsecuted and killed by Lhe Nnzis.
:;reisky: 'I'h~t was an hi~toric cata:~trophe ~nd the destructive ~ril1 of fas-
cists certninly lay mc~st henvily upon the Jeas. But it ~1so 1~d to the ex-
termir~r~tion of ~he F'oli~h intellectual~ und many otherg ginCe afCer all Nazi-
ism ncre~scsrily beg~n ~s a u~r within the populace und ended as s war be-
txeen peoples, ac~d s~ raillions t~nd millions of JeWS ~nd non-JeWS became its -
victims, mne genocide--and thc~t ceems Lo me to bh the most impnrtarit fact--
_ began with the JeWS and ended ~riLh u11 those others Who fell victim to the
xar. But I Will teil yoj.t ~tho r,y executed relatives ~rere: there Was Ludvig c
Kreisky, one of the mo~t, deLerm,ined defenders of German education in Czeeho-
slovakin; there wns Otta Krei~ky, an attorney in Vienna, $ member of a t~er-
man libci�al stizdent urrion; t},ei�e wa:, a sister of t~r fgther, Julia Sehnuer-
macher�, snd her husband who Was a rnther conservt?tive c~ld Austrian officer;
u!~o exe~cuted in Kerlfn w~s n~lerman Sociul Dcr~ocrat, Arthur Kreislyr, vho
c..~perr~ted aith LhP ~�r.ech re:;is+,nr~c:~~ c?ovenent. Suicide ended th~ 11fe Of
Julius ~elix, a hich ~u:ge in Viennn and n~ m~ther's brother. It is those
things uhich w~re at i~sue here xhi^h have ciade the Jews into a fated commu-
nity. If one wa;rs Lv overcore this cor.mmunal fate then it is aati-Semitism
~hich must be overcome.
5T~1ih: Jn other Worbs ;~ou ~ish to raaic~ cleer that it is neither as g Semite
nor r~s an anti-SeMfte bi~t ~s c~ 5ociaZist that you engage in that criticism
of Isr~el's politics ~rhic~h hns reYCa'e~y excited ~o much r~ttention?
Kreis~y: i ma~te Lhis ~,ri~icis;.i on '.:e basi~ of ~r general 3ocialist posi-
tion.
' STER?J: In other xor:i.z you wi:.~ no*. allox your~elf to be driven into a spe- -
cial posiLion of lo~al?,y Lr;:rar~: israel?
Kreisky: I~ an Au[~r.~n. ~ hnv~ n. 3~'_-;; ~;,I;~ to t~y country--~just as aal
unce~t~rs hel--and Lo ~y fdn~.ls.
5TER;~: N~u t:;e ~tnt~� o: Israel exis;,s :n Lhis country in vhich earlier the
Polectiniuns xere aL home--alrea~yr ab~ut 3 decades ago. Surely you do not
xrsnt to deny the right ~o existence o: Lhe state of Iarael?
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Krei~l~y: Quit~ on the contre~ry; thp~~e a civilixing ~chievem~nt ha~ b~en ~ar-
ried out which iu uniqu~ in it~ kind. In addition there i~ the fgct that it -
~c~ th~ dnly q~ylum cnuntry for p~rseruted J~Wg which is np~n tn thpm a
pridri. But for me there is annther prnblem Whieh is ulgd important: Wh~t
is t~ t~~pp~n td ~he million~ nf palegtiniung who algo huve a right to a home-
~~nd. If th~ nt~te of Igrael, Which i~ r~sponsible for thi~ problem, 3g un-
ab1~ tn golve it then there existy the dgnger ~hat Igra~1 m~y become ~ome-
thin~ like ~ cruagde-gt~te and ean nn].y Continu~ to exigt by b~ing d~f~nded
With fir~ ~nd nWOrd--until the others h~.ve t?cquired mnre fire gnd more
~WOrdg.,..
"'Chcre Might ~e d b~nger of Lsrnel.'g 13ecoming ~i Crus~der SCnte"
!
S~E~iN: F'dr auch expresgion~ you have been branded b1r the Israelis ag g
traitor.
Kreisky: ~y th~ cnngervative Israelis. 2 u~so hsve many friends in Isra~l.
STERN: In the Arab aorld you have more friends....
Krei~ky: especially because I hav~ b~~n vigoreuuly critici~~d repe~t-
edly in I~rael for rt~y vieWS regarding the Near ~ust question.
SmERN: You were one of the first important stutesmen to advise the Israelis
to negotiat~ d4rectly aith the ~rptian pr~sid~nt9 5adst.
Kreisl~y: Yes. But at that time [ was sttil ~;reetcd hy ~cornEul laught~r from
tl~e Israeli neWSpapers. And when they made no progress some of them be-
sought me to egtablish initir~.l contacts aith Sadat.
STERN: Nox did you establish this contact?
Kreisk,y: 'Phe mo~t important and most visibl~ step xas perhaps the fact that
I brc~u~;lit opposftion l~ader Peres to 5alzburk to a meeting with Sadat.
This rr~de $egin nervous because the opposition leeder was the one ~+ho had
begun the conversation xith Sadgt. Sadat had hesitrsted to have ac~y conver-
ggtion with Begin at gll. Thst's the wey it xus!
~TERi~: In other rrords in the foreground of thr great conversations betveen
. Sadat and B~gin and long before the meeting in Camp David you conducted Is-
raeli politics secretly?
Kreisky: I did not nccua lly engage in Israeli polities or in Arab politics. �
1 have only attempted xith the neans at a~r disposal to establish contacts
and to express viexs. President Carter naturally has quite different cepa-
bilities.
SZ'ERtt: Yau certainly have more sympgthy for Presiri~:~t 5udst than for Begin--
y~.i descrihed thc letter noc l~nq ~~;o in an intervie~r With n Uutch newspaper
:~s a "petty-minded prrson."
r
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Kreinky: I m~ant that hp hg~ reacted to a great g~etur~ of hietorie inipor-
tan~~ in the manner of
a shopkeeper or ag we Would 8!~? ],@H8 offene3ve],y,
"(}reigaler" (old mis~r~. If he feels inaulted by this then I apologize for
it becuug~ I didn't Wsnt to ing,~,t riim, but the characterization I cannot
r~tr~ct. The shaft h~g 1~fE the bc~w and ~ myy pprhapg be permttted to add
that in ntiy opinion end on the bas:s of rr~ knoaledge Begin vee granted the
~ Nobel Prize for Feace somewhot too early~ Too bad that Ezer Weixmaa didn't
get it.
Sm~tN: What did W~izm~n nrhieve?
Kreisl~y: A1.1 that I W~nt to s~y now about thig matter is that aomedqy there
wt11 be more informstion available about it.
5'~E~tN: Mr Ch~na~lldr, youx~ brother, Paul Kreislqr, 1iv~$ in Igrael. Z'hinge
are said *o be not going very We11 ~rith him. Are you actug].ly aupporting
him7
Kreist~y: 7'hat is a b~d chapter. N~y brother hag been used againat me under
f~lse pretensea by people who are n~yr enemies. Once h~ is said to h~?ve
plqyed in a film thp role of a begger at the wailing wall. Thp picture nf
thi:: ~r_~ne wa~ ~hown tl~roughout the world in order eo declare that I nllow my
brothcr to go begging; and nothing was said about the fact that it was movie
scene. people have used him against me in the moat disgra?ceful ve~yr. It is
Lrue that for a long time his health he~s not been so good. Years ago he
suffered u head in~ury in a~pnrts ~ccident an,~i is etill suffering from the
nftereffects. I am supporting him aith e? month~jr sum r?hich eorresponds
rbugh]y to an Austrian income. He receives sdditionel amounLs every quar-
ter. In addition he has a small pension from Austria en8 one in Iarael. An
honorary consul who is one of nrpr friendg is, sa to speak, his protecting
pntron in Israel. But in addition he has a groti+n sc~n. I have met him sev-
eral Limes in Israel and in Austri~.
STERN: N~,w we c~re cor~inK to m~re person~l matters. We have h~ard that ~
every Austriar~ citizen can telephone you thzvugh your priv~te number, 37-12-
36, r+henever he W~ntg to discuss ar~ything with you....
Krefsky: t':ey include a very amoll number of nuts ~nd stinkers, but
most of the people uho have telephoned me rrant to diseuss matters vhich are
personglly importeu~t to them; troubles xith officials, financial problems or
they me`y wgnt to discugs political thir.gs. Also, mar~y of them ~uat Want to
see r+hether I am really at the telephone and they greeL me in a friendly Way.
:'i'~RN: Ffnat telephone ca.lls have you received in recent de~ys?
_ Kreisky: After the referendum on atomic ener~;y e ~+oman callec~ me, for exam-
ple. from a Viennese disLricL and seid that sometime I would heve to do
something ubout the fuct that her lar~dlord leaves the light in the vestibule
on all nigh~--although We're supposed to be ssving as mueh energy 8a possi- ~
bie.
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ST~FiN: And--hav~ you d~ne anything ~bout thi~7
Kr~inky: I ~ent ~omeboc~y dver who ~xch~n~ed s fri~ndly Wdrd ~rith ~he
1ad,y nnd th~ 1~ndl.~rc~. TodF?y ~ pe~sant rroman called me whose hou~ehold
gdodg ar~ about to be uuctidned dff. She u~ked whether ~ cou].d not he~.p
her7 5ince I was ul~o tulguCCcssf'u]. i.n getting her a p~ymen~ regpite (the
~cnount was nver 23,n00 ~chillings) I told the Womc~n th~t ~ rroul.d 1.end her -
the n~cesg~ry :noney �or a tr~?nsitic~n~]. period.
5'P~~iN: Your priv~te money?
Krei~sl~y: It is, so to ~pealc, semiprivute. I~'or ~uch und other soc3a11y
eapecic~].l,y n~ec~y caaes I have set up u�und here in the chFU?cellor's office
in which, for ex~np~e, I plnce the honorari~uns Which I rec~ive t~s fed~r~s1
Ch~n~~lldr for lectureg und articles. The fund also includes mt~ney obtained
from newap$pers which I have ~ued for fal~e reporting conccrning me and aho
have then been required to pe,y me cnmpensution. Taken altogether it ~mounts
td about 100,000 schilling~ (15,000 marks).
ST~RN: S~hat does Bruno Krei~l~ do vrhen he isn't po~iticking? Whnt are you
r~;adir.g right now?
Kreisky: The memnii�s of a Russian diplomat which, ns a m~tter of fgct, I
bought in the GDR during a state viait. He Was u pnrticipant in develop-
ments during Stali.n'~ time and he ha~ desrribed these developments very
gruphiac~lly and with historieul uccuracy. Then, also, I'm reading an Ameri-
ran bonk nbout space research and another abaut Cerm~n aocisl demoeraey.
STEfiN: bo you go in for sports?
Kreisky: I en~joy pl~ing tennis and pl:+~v i.t fairly regulr~rly, but I'm not
~speciglly good at it. I am a member o: the Vienna Club. One of ~ part-
ners is n former criminr~l-court official atio used to be a convinced commu-
nist.
STERP~: That brings us uack to domestic po.litiCS: Are you considering a
sort of radical decree in Austria ~hich xould keep extremists, in other
Words communiats in particular, out of public services?
Kreisky: Fnr heuven's sakel Sufficient for me is the trouble people have
been t~aving with that in Lhe Federal Republic of Germany.
~TERY: Md so you hr~ve r.o fea: Lhat ~o~c.~u.~isLs as ~eachers ~ill cori�upt
Austria's children politirally?
Kreisky: Nol I'm nga~nst communisra, but I have no fear of communists. In
Austrir~ one must deal Witr. them politically, not adminiatrative~jr.
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, SmERN: What do you think--in thi~ connection--ebout Eurocommuniam? -
Kreisky: Not very much. I don't believe that that w111 be a v3able move-
ment of historic perm~nenc~.
S'CERN: Do you think that Eurocommuniem ig a Tro~an horae from which the
_ rulerg in Moecorr will one dqy emerge?
Kreisky: That I don't knoa, but neither can I exclude it. The Tro~ati horse
- tcetics were recommended--Y believe--back in the deys of the 3eventh Commu-
nist World Congress. That aouldn't be arurthing nex. But here what is obvi-
ougly involved is the attempt of comnunisto to behave democratically for so
long a time until they sha11 come to power within the framexork of the ex-
isting constitution. Hitherto, comonunieta 3n poaer have not been re~?c~y
democratically to yield it up agsin.
S'~~tN: You once ssid: "It is the tragic fate of the revolutioniets of the
pa~t tha?t in their old age they must atand ~rotYnd at receptions in evening
dress and xearing Lheir decoratione."
' Kreisky: State ~?ppearances are what I most hate in the business of poli-
ticg.
S~~RN: So you don't like formal evening clothes; but you're said to br
style-conscious man vho likes to xear expenaive tailor-made suits, tailored
shirts and cuatom-made shoes.
Kreisl~y: I am a quglity-conscious consumer. T~rould rather b~r expensive
things that last than cheap things Xhich I'm continually having to replace.
Th~t sort of thing turns out to be much more e~cpensive in the long run.
(Kreisl~y leans back in his chair, lifts up both pants legs atid points to his
b~ack leather shoes.) Look, these are shoes made by a go~d master shoe-
malcer. That ia Austrian quality Xorkmanship. By norr they have been mar~y
times resoled, but they still look quite passable--it xas in these ahoes
that I marched into emigration in 1938 aPter mar imprisonment by the Geatapo.
COPYRICNT: 1979 Gruner Jahr A~ ~ Co
8008
CSO: 3103
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~ FRANC ~
SOVIET 'MULTINATIONALS' IN WEST D2SCUSSEU
Paris VALEURS ACTUELLES in French 5 Mar 79 pp 34-35
(Article by Francois Lebrette: "The Kremlin'a Multinational Companies"~ ~
(TextJ When Moacow employe capitalist tactics, the reeult in France is the `
Commercial B~nk for Northern ~urope, an inatitution scrutinized in Jean
Montaldo's ~ecant book. And the reeult throughout the world is hundreda -
of "Red multinational companiea."
~"An American receasion would have aerious international consequencea not
only for the dollar, but also for the credibility of the United States, _
that country'e leaderehip, and Western unity. On the other hand, in the
congressional electiona of 1 November,Preaident Carter succesafully hurdled
his moat difficult obatacle. He can now continue to act with authority.
Will he do it? We can only hope he will."
This comment ia taken from an 18 November 1978 report prepared by the resrarch
department of the Co~ercial Bank for Northern Europe (BCEN). There would
be nothing surprising about a bank displaying so much concern for "Western
- unity" were it not for one characteristic of thia particular establiahment:
it is the French branch of the Soviet Goebank and Vneahtorgbank.
In his book "Les secrets de la banque sovietique en France"--published by
Albin Hichel--the journa].ist Jean Montaldo attempte to ahed light on Euro-
bank's operationa, Eurobank being the BC~N's other name.
He who pays, calls the shots. And the documentary evidence presented in `
= Montaldo's book shows that the funds of the French communist apparatus are
in the hands of the Soviet bank. Yet at the eame time, this bank ateadily
continues to conduct itself like an orthodox capitalist institution.
To such an extent that the Soviet bank is as mistaken as other Western
banks in estimating certain situations. For example, a Eurobank official
returned from an April visit to Iran reaeaured by what his contacts there had
told him. One of the latter had infonaed him that "even if the Shah were to
abdicate in 4 years, as rumors indicate he might. he is convinced the military
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h~vp nlr~ady made proviyione for his auccession." Her~ce the situaC~.on was ~
~ favorabl~ Co gctive invnlvemenC in the Irgninn m~rket.
T}~ig ~mbiguity--if it is not, indeed, duplicity--ia rhe lot of Che eniCre
banking and commerci~l web the Saviet Union h~s woven in the Weatern world.
The bank Jegn Montaldo examined in detail is but one of some 90 Red "multi-
n~tion~l" corpor~tions. It is nlso one of the old~est: it was in 1925 ehat -
Mnscow noughC the BC~;N from a group of White Russians. Previously, in 1919, -
the Soviets had purch;sed Che Moacow Narodny B~nk of London, glso from White
- Russiang. WiCh the Russo-Ir~n Bank founded in Tehr~n in 1923, these estab-
lishments Long remained the sole poinCs uf conCacr between the Soviet
economy an.d the rest of the world. They were sufficient for an autarkisC
regime. _
Increased East-West Crade in the 1960's prompCed Moscow to multiply iCg
branch banks: Che Ost-West Handelsbank in Frankfurt in 1962, the Wozchod
Handelsbank in Zurich in 1966~ the Donau Bank in Vienna in 1974, and the United
East-West Bank in Luxembourg. Meanwhile the Narodny Bank of London had
eatablished two branches: in Beirut in 1962 and Singapore in 1971.
At Che same time, their asaigned purpose underwent change. From purely
commercial banka they were transformed into speculative establishments. By
its dealings in the dollar money market, the Eurobank gave the Eurodollar
its name. As for the Narodny of Beirut, it seems to have become specialized
in the selling of gold outside usual commercial channels. For instance, it
is reported to have discreetly transferred 5 tons of gold to the oil-�rich
emir s . '
Writing in ITT's review PROFILS a year ago, the ~ournalist Andrea Garrigo
commented as follows on the United East-West Bank: "The Soviets have dis-
covered the quiet charm of the Luxembourg tax paradise. Since 1974, this -
bank has been conspicuously engaged in large-scale arbitrage transactions
- with short-term deposits in strong currencies."
But capitalist speculation d~mands skills which Soviet bankera sometimes
lack. They learned this the hnrd way in 1975 when the Donau Baak lost 1 _
million dollars placed with the Allgemeine Wirtschaftsbank a Lew months before
- it failed. That same year, the Narodny Bank of Singapore lost 60 million
dollars in the bankruptcy of the Mosbert group of Hong Kong.
The overall balance-aheet is far from being in the red, however. Again
in 1975, t}ie Ost-West Handelsbank posted profits of 4 million dollars. Jean .
- Montaldo ~eports that from 1973 to 1977 the BCEN amassed profits of more than
170 million francs, including 35 million francs the last year.
Banking speculation and loans are not sufficient, however, to cover the
Soviet Union's foreign currency needs. The USSR also has to sell its products
in world marketa and~ therefore, establish commercial firms in foreign _
countries. Obviously the simplest thing to do is sell raw materials such as oil.
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The Soviet ;,il companiea NafCa-Belgium and Nafta-GreaC Britain did not heai-
tate Co fill the gap left in the European market by defgulting Arab produc:ere _
during the 1973 Yom Kippur war. In 1975~ Nafta even operated direc't1y againat _
OPEC by offering ita oil at a 10 percent diacount.
Little by Little~ Nafta has changed into a canventional WesCern oil com-
p~ny. IC has large storgge facili~ies in Antwrerp and ~ chain of aerv~ce
stationa in Belgium and Great Britain. In Chis way, a Soviet company gets
to ael:l Arab oil to Western moCorieta. Admittedly there is a reciprocal
situation in Finland where American aervice statione market Rusaian oi1
imported by Teboli, a Soviet firm.
OCher easily sold raw maCerials include diamonde and lumber: diamonds by
the Russalmaz company in the Federal Republic of Germany and Belgiwn, lumber
by Rusboia in France, Ruslegno in ICaly, and the Rusaian Wood Agency in Great
Britain. Fiah and ahellfish caught by the Sovtet f3.eet--the world's largeat--
are also procesaed and exported: in France by F:ansov, in Belgian by Belso,
in Ital;~ by Sovietpeaca, in Spa{n by Pesconsa, and in Sweden by Joint Trawler.
These campanies experience liCtle difficulty marketing their producta. The
same is nor true for those Soviet subaidiariea attempting to sell manu-
factured gooda in the WESt, automobiles for example. The American FORTUNE
magazine described this problem as followa in iCs February 1977 issue:
"Soviet consumers may be willing to buy a car knowing that no apare parCs
are available, but not Western conaumers. After-sale aervice is not a Soviet
strong point." This accounts for the difficulties encountered in Western
markets by Avtoexport and its aubaidiariea: Scaldia-Volga in Belgium, Matreco
Bil in Sweden, Koneia Norge Bil in Norway, and Konela in Finland. And even -
in Africa where Avtoexport is the sole Red "multinational company: repre-
sented in Cameroon by Cateco and in Nigeria by Waatego Lagos.
Problems are even more critical with heavy equipment sales despite the fact
that Soviet prices are lower than average prices for equipment made by
Western competitors: as much as 40 percent lower for machine toels and 20
to 50 percent for farm machinery.
Results appear to be slightly better in the lignt consumer goods market.
Ocean shipping is, however, the only sector in which Soviet compet~tion is
really alarming. Soviet freight rates are on the average some 20 percent
lower than international rates, primarily because of the Soviet seaman's low
PaY�
Moscow currently controls 10 percent of the shipping traffic between Hong Kong
and the west coast of the United States. In traffic emanating from the
Soviet Union this percentage risea aharply: 75 percent with the GDR, 84 per-
cent with Great Britain, and 95 percent with Japan where, however, no Re~
multinational companiea are established because of the absence of a peace
treaty.
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'The neCwork of ehipping agencies, all. Sovinflot subsidiar~es, is particularly ~
denpe. The Tranewnrld Ma ritime Agency is present in Belgium and the Nether~ -
1andB~ nnd Morflot in Canada gnd the United Statea where Sorfracht also
operatea. In France~ the SovieC shipping ~gency ia Sagmar; in Finland~
Sama; in Italy, Sovitalmare and Dolphin~, etc.
Kxrl Heinz 5ager, vice presidenC of Hapag-Lloyd, explained to FORTUNE: "The
Russians aeC about becoming a m.aritime power noe for the sole purpose of
obtaining foreign currency. This effort has to be ~udged in terms of politi-
cal and strategic interes ts. When the Soviets transport cargoea of manufac-
- tured goods from the West they can do what they wanC when these cargoes `
' are on-board."
The height of absurdity was certainly reached last year when General Dynamics.
an American firm, had F-16 fighter aircraft parts ahipped to a NATO country
via Soviet freightera.
Strategic interest, but also induetrial espionage. The Soviets readily
enter into partnerships with Westerners to establiah ~oint companies engaged
in those advanced technology fields in which the Soviets lack expertise. For
instance, in the electronic data processing field they formed partnerships _
known as Elorg in the Netherlands and Elorgdata in Finland. Elorg's Dutch
partner who owns 20 percent of the capital atock and manages the firm, expl~ined:
"In the long run, Elorg n~t only opens the door for the sale of Soviet compu-
ters in the West but also enables the Soviets to develop their computer indus-
try:'
This man no longer has any illusions: in April 1976, his senior Soviet
assistant was expelled from the Netherlands. For espionage.
COPYRIGHT: 1979 "Valeurs actuelles"
8041
CSO: 3100
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FRANGE
SHIPYARDS IIUILDING SUBSIDIZED VESSELS FOR POLAND
Paris L'EXPRESS in French 10 Feb 79 p 86
[Article by Agnes Rebattet: "Shipyarde: A Suicide Contract"]
- [Text] Four ahips, 5 million working hours: The Polish order to France
- seems "providential." However, it is without enthusiasm that Jean Reyrolle,
presidenC of the La Ciotat Shipyards, and Pierre Loygue, preaident of the
_ AClantic Shipyards [in St NazaireJ, are negotiating with the Polish ahip- "
� builder, Polish O~ean Linea. It is als~ without illusione that they are
trying to wring sume concessions from them.
In order to obtain ehis last-chance order, an oxygen tent for an industry
that is choking to death, the French Government has not shown itself par-
simoni.ous in its methoda, and is giving a royal preaent to Poland. Indeed
these ships, half freighter, half container carrier, will cost more than
1 billion francs to build, but will be sold at half price to the Po1es.
The government will pay about 350 million francs, and the shipyards will
have to absorb 200 million in losses. It is a ruinous order: between
governmenC subsidies, the loss to the yards and the sum of 120,000 francs
per ~ob per year--the amount of the salaries and fringe benefits that must
be financed.
In the case of La Ciotat, the two Polish ships represent 2 million working _
hours, scarcely half of the total capacity of the yards; but for 6 months -
4,300 workers will have ~obs. It is inadequate, of course, so that the
;~ards are trying to diversify: to include repairs, which cause angry reac-
tions on the part of the workers of the Terrin [firm] in Marseilles.
In St Nazaire the situation is hardly less brilliax~t. Orders are thinning
out: three ships are to be delivered this year, three others in 1980, and
a single one in 1981. Pierre Loygue, however, hopes to obtain rapidly the
construction of a hydro-electric power station on a barge, for the
Americans. It would be a"first," and an opportunity for the Atlantic
Shipyards to put themselves on the promising market of floating factories.
This is a dream that Pierre Loygue has indulged in for some time, but
which has never taken concrete form: "The Polish order will permit us,
~meanwhile, to keep up the present rhythmn of 34 working hours a week:
That's enormous!"
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A yenr of tight negotiations will huve been neces~ary to snatch this
suicidal order away from Che Finna and Che Spaniarda. At firat, Polanc;
wanted 18 shipa. The bi11 would have been too large for the French
government, which reduced the number of ships to four. The others will
be built partly in Poland, partly in Finland and in Spain. Poland wina
on nll counts: She can build this kind of vesael herself, but ahe pre-
fers Co devote her shipyards exclusively Co orders for export--whi.ch
makea it poas ible for her to be paid in cash. This provides her with the
foreign currency indispenyable to her b~lance of payments. For her own
fleet, she purchases from foreign shipyards at the "Polish price," and,
beCter still, on credit. And what credit! The discount paid when the
order is aigned, which represents 30 percent of the value of the ahip,
is refinanced by French banka at a rate below thaC of the market, to be
reimbursed in 12 years. The 70 percent remaining will be paid in -
_ 7 years aC th e OECD rate of ~ percent.
The Poles can thus acquire an inexpensive f1eeC and compete with Euro-
pan ahipbuildera on the north Atlantic. They will be unbeatable--like -
the Soviete--who are exciting the fury of Western shipbuilders. By ~
charging freight rates from 18 to 40 percent below prevailing rates they
_ have already correred 20 percent of Che container carrier traff ic of the
Third World between East and West. -
COPYRIGHT: 1979 S. A. Groupe Express
(
9347
CSO: 3100
;
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FItANC E -
- ROCARD'S STATUS IN PSF WEIGHED
i~aris LE NOWEL OBSERVATEUR in French Z2 Feb 79 p 31
[Commen~ary by Kathleen Evin "Michel Rocard's Dilemma"]
[TextJ Meeting Sunday 11 February in Paris in the third basement of the National
Aasembly, the 131 membera of the executive committee of the PSF [French
_ Socialiat Party] were to take in c~gnizance different opposing motiona and
to compare positions in order to see if it were possible to aome to an im-
- mediate agreement. At the close ot this meeting, the motions remaining were
to he sent to each aection of the party to be discussed and voted on. At
the Congreas of Metz on 6, 7 and 8 of next April, the number of votes
which wiil ga t~ theae texts will determine the power relationship between
' the different currents and, in consequence, their representation in the
leading authorities of the party.
On the eve of this executive committee meeting, Michel Rocard faced a hard
dilemma: either to agree to play the loner until Metz, thus running the
risk of seeing himself marginalized by arriving totally behin~ Francois -
Mitterrand, Pierre Mauroy and--who knows?--maybe even CERES [Center for
_ Socialist Studies, Research and Education], or elae to choose synthesis
immediately, in that case agreeing to conclude without glory a contest which
he himself started 10 March 1978. "At any rate," explains one of his par-
- tisans, "we will not have really lost, because our ideas, thoae for which
Michel is fighting, will have been included in the foundation. And it will
be a good while before this contest, which we have atarted, is over."
In the meantime,this "democratic debate" which has agitated the PSF for
nearly a year in the end will not. make it lose an inch of ground with the
electorate, at least if one believes the results of a Sofres poll published
_ 5 February in 10 regional daily newspapers. Thirty-seven percent of French-
men questioned felt that it has grown stronger. As for Michel Rocard, for
42 percent of those questioned he is still the best candidate for 1981,
a percentage which becomea 50 percent among "socialist sympathizera."
If the polls replaced the Congress, then Michel Rocard would already be at
the head of the Socialist Party, and Francois Mitterrand would now have all
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rh~ ~im~ nec~~g~ry Cn a~rry off gt Lgt~he the "Loutg-Ngpnledn" prdmi~ed gC
Cn1lim~rd n~~r1y 1n y~~r~ ago. gut Ch~ rpglity 3~ much diffpr~ne. Ind~~d,
~t egCh public me~tAn~, ~gch militant meeting, each lunchpon with ehp r~nk
gnd file and th~ local leading citizpng~ whpth~r in Ggrd, Pyren~e~-Orien-
tgleg, Alpe~-dg-Hgute Prdvence~ Ch~ North~ ehe Lorraine or the Rhone, Mich~1
ttdC~rd hr~~ be~n nbl~ td eay thet he waa~ together with Fr~ncoie MitCerrend,
~
th~ nnly ~ocigli~t l~~der during this difficult p~riod to be ab1~ to fi11
- the he11s and arouse the enthusiasm of his ~udi~nce.
- "On~ hw~c~r~d fifCy p~r~ong gt Ale~~ 300 ~t Bgnyulg, 500 ~t $~zier, gnd
everywher~ e terrifi,c receptinn...Teng and ten~ of 1QtC~rg of ~uppore gre
grriving from all party federsCinng H~'s going etrnngl" Mich~1 Itocerd'~
"te~m," in~tall~d in their offices at 98 Rue de 1'Univer~it~, arp following
the evolution of th~ winning aide from moment to moment.
Ar?d with chese on the whole very encn~raging re~uleg, ehe aa~c optimietic
~re hazarding e~eimateg. The prophesy of g clo~e collaborator of sh~ deputy
from Yvelinee, on 7 F'ebruary "The Rocard motion7 Today it would rec~ive gt
least 24 percenC."
~ternal Suspicion
Nothing is lega c~rCain. The first tally among the PSF fedpratione would Sn
fac~ give lege than 20 per~ent di the voC~s to a nw tion signed by Rocardianq
alone. How can one explain the disharmony among thig "ma~ority of idea~"
which seems to be falling apart around Michel Rocard when he is calling for
a party more abaorbed by aocial and economic realities, a less dogmatic
political language, a really original aocialiat plan, the expansion of the
Union of the Left to other maea movements; and the fact that he still re-
mains strongly minority in his party? There are esaentially tao reaeona: _
The firat ia evident and ie explained by the profound attachment of the
ma~ority of militant socialists for Francois Mitterrand, the man aho in 1971
made a succees of the union of the socialists, who signed the "Common Program~"
who made the PSF the leading party in Prance. By saying on "Cards on the
Tabl~" on 15 January that the reasoning of his strategy led to the elimination
of the present firat secretary, Michel Rocard~ even in his partisans' opinion,
made n mistake.
The second reaeon is more hazy: deapite hie pro~estations and his record of
service to the Left, Michel Rocard is atill eternally suspected of "leaning
to the right." His popularity with the UDF ~French De~cratic Union~ elec-
- torate and the fact that he is opposing Francois Mitterrand, the socialist
symbol of the Union of the Left, do him a dieaervice. Even if he is ir.-
reproachable, the doubt remaina.
And they work againet him. even as far as such apectacular aupport as that
of LIBERATION or of the direc[or of the magazine ESPRIT.
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Aw~r~ c~f thp~~ coneradiction~, ehe miiitane ~ociali~t~ think they have found
~hp ~niution: k~~p Mieterrand and ltocard--aed Mauroy, of course--in th~
p~rty i~ed~rehip ae ehe ~am~ eim~, the vireu~~ of one compen~aeing for the
_ ehoreedroin~~ of the oehere, and vice verpa. Beeidea, vh~n a11 ie ea~,d and
don~, it ie toaardr rhia eo erdently derired ryntheeie that the aociaiiet
leaderg ar~ moving. '1'hey aili achi~ve i~~ no doubt. Su~ in what conditia.:. .
~PYR~GH'~: 1979 "1e Nouvel Obsetvat@ur"
9 3B0
CSd: 31d0
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W~S~ ~~I3MANY
Fdit~I~N tl~'~IG~ 5~~It~'TAItY bIS~U55~5 ~1d~tl.d ~C't~NOMY
gann ~t1ft~PA ARCNIV in G~rn~n 10 ~eb 79 pp 65-7`
fArttcl~ by Guen~h~r v~n We11, gtate g~~r~t~ry of th~ ~'c~r~ign Minigtry,
~dnn: "politi~al Asp~ctg di the Chanqe ~n Stru~ture di the Wor~c~ ~conomy"~
I~'~xt~ 'i'he geru~ture c,E the w~r~c~ eednomy, as it firg~ d~v~ldp~d gft~r
~he war, was stamp~d by a dualism: on the one gide the indugtrial
nations di the W~se with a dominatiny leading power, thc United 5tetag,
end ~n the nth~r ~id~ the less incl~~triali~~d "p~riph~r~l" ~r~ag, Which
r~ into tihp pictur~ ag suppli~rs of raa mat~rialg ~nd e~ buyer~ nf
indu~trial prc~ducts. Althdugh the ~nviet Unic?n forn~d it~ own
gravieational fi~ld within its ~ph~r~ nf influenc~, ev~n the Council
for Ecnnomic Mutual Agsigtance iC~MA) belonqed in ~ggence to the ~
peripheral ar~ns. The division whirh hag be~n mad~ into th~ "thre~
worlfl~" aa~ more politically metivat~d: it ~~r~n~ from the nntaqoniBm
betW~en th~ Unit~B StatQS a~nd th~ 5oviet Union, the antaqonigm between
the twtv systea~, whirfi~ th~ developing rnuntri~g did not want to
identify with ~ither erdnomirally or politically in thp long run.
. Since then much has changed. 2'he most impartant structural ehanqes
can be d~scribed as fallows:
�
--th~ shif~ing af th~ ecnnomic and pnlitical cent~r~ of qravity aaanq
the Western industrial rountries,
--the emergence of the developing coun~rieg as independent political
a~d economic factors,
--thr forntiatian of a modus vivendi based on a policy of detente between
the East and Ftest, and the i:~creasinq participation of the CEMA
countries in world eCanomic events.
T1~~ SL~uctuYe of Cooper~tion of the Western Industrial Nations
About 70 percent of thc world trade is still conduct~d among the
Western industrial countries. This share has changed only slightly
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~i~~G~ th~ b~glnning ~f ~h~ 1960'~. Nc~r~vpi~ ehi~ f$e~ eonc~~i~ tih~
gh~ftg whieN hav~ ari~~n Within th~ qroup e~~ W~~eern ~ndu~eriai cout~tri~g.
~'h~g~ ghiftg can b~~ch~racepri~~c~ und~r ~hra~ he~dinqg:
=-~h~ r~la~iv~ de~lin~ of th~ w~ight of th~ tinit~c~ ~t~t~~, -
--the c~eveloptnent of the ~uropean Community (~~C~ ~
-_the ri~~ of Jap~n.
in ~he y~~r 1960, th~ t1ni~~ri S~~~~~ ~~;11 r~r~iv~d a~h~r~ ef SS p~rc~nt
n~ the grog~ naeionai pror~uct of th~ W~g~~rn Worir~, anc~ in 1977 thig
~fqure wa~ ~ust 38 p~rcent. in ehe ye~r, th~ ~~C'g ~h~r~ a~~
32 p~rr~n~. 'rh~ Unit~B Seat~s i~ Bti11 ~he :eading e~onomie power of
eh~ W~~t and thu~ ~f th~ worid. 8ut it i~ encot~nt~ring lia~it~ to it~
~~dnomie ~tentialitipgi
--in the Vi~tnam W~r, tt had ta 1~~rn that a war eannot be financed
~n tb~ ~id~, bu~ ehat it l~ads to inflation if ~h~ dem~ndg an the
n~tidn~i product ~re not whttt~~d down.
=-mh~ d~~line of th~ dol~ar ghowg thae in th~ lc~ng run even the Am~rican ~
b~l~c~ of p~yym~n~ defiei~ rannot be fin$r?~ed "by the qovernment's
~n re~ourc~s." For the firse time, in a d~partur~ from its form~r
policy the United St~t~s has falYen back on its r~~arv~s 1n th~a
int~rn~tional Mon~tary Fund (it~~ and has had to raiae foreign-currency
loan~.
--Th~ United States is today importing about half of itg oil requirement~.
With ~at, it hag b~come d~pendene on foreign cwuntrie~ in a key area
of its national economy.
--5ince the nil crisis, the econontic d~velapment of ~test Europe has
fnr thr first time been influenced lea4 ~~+++n f~+~rty by erenomic
yrowth in the Unit~d States.
Und~r pregidentg Nixon and Ford, American policy already took into
account lhis developn~nts Through the ~tregsinq of interdependence
and the A~Llantic partnership, through the thesis of the three centers
nf North A~riaa, Europe, and Japan, and throuqh the founding of the ~
International Enerqy Agency in Paris and the political upward revaluation
of the OECD.
However, the aast conspicuous proof of the existence of the nea situation
is the world economie suamit a~eetings. Politically, this signifies
- that responsibility can be borne only jointly ~y North Amerfca, Burope,
and Japan.
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'Pht ~t~~h~ping di th~ W~gt~rn "~rd~r af Cod~~~rmina~ion"
dne n~~d~ ~nly tr, Y~~~11 eh~ unllat~ral, drastic m~a~ur~g eak~n, without
~h~ ~on~ul~aeion of ~h~ parener~, by the Am~riean ~r~gid~nti in Augue~ 1971
~ehe ga-eallec~ Connaily ghock, ~nvoiving tihe abolition of th~ conv~rtibi~iry
~.h~e dollar, th~ in~roductiion af an impert lpvy, and oth~r flaeree~),
to r~~1iz~ wh~e ~ gr~~~ cii~t~n~~ th~ United St~t~g has traveleci in the
int~rna~ionai coorc~inating of it~ economic anc~ monetary poliay up tio
th~ ~im~ of th~ ~onn worid ~conomic ~wn~ni~ m~~tiing in ~uly 1978.
'i'h~ fir~e ~ign~ af an Am~ric~n r~adine~~ ~o m~k~ 3t~ oMm ~conomic
po~icy eh~ gub~~ct c~f con$ui~ation with th~ West~rn partner~ appeared
with th~ vi~ie of ~'~d~ral Chanc~ilor Sehmic~t to Washington in Deeemb~r
1974. With hi$ r~turn vi~it td ~onn in July ~975, President Ford
8~elar~d to the pres~ tha~ the Qconomic policy of the United 3tate~
muge form a whoie With that of the EEC. in the talk~ th~tn8~lve~ ~ord
Nad �ade it c~~ar, with the epirited as~igtanc~ of Ki~~inger, that in
thc fueur~ the Unit~d Stae~~, in $pitie of ~h~ oniy gmall 9har~ of itg
fc~r~ign trad~ in th~ gro~g nationai product nf the EEC, neverth~l~g~
wanted tn ~~ordinat~ itg ~cdnomic, crediti, an8 monetary policy clo~ely
with ies ~uropean partn~rs. With that, the cornerstone weg la~d for
the ~ubs~quently ensuing world economic gwnmit conferences in Rambouillet,
pu~rto ttico, London, and Bonn.
if it was the cas~ that earlier--that is, befor~ the termination~ ~~al~d
on 15 Augu~t 1971, of the world mcnetery ~y8tem of Eretton Woods--
ehc functioning of the cooperative m~chanism of th~ Weatern nation~l
~cr,nomies could be quarante~d through international organizations such
as the IMF, CATT, and the OECD, becauge in them the policy of the
Unitpd States waa the determininq factor, then in the course af th~
1970'g and incr~asingly go following the oil embargo of October ~973
new structures for conp~eration among the Western industrial nations
had to bp found which took into account the increased weiqht of West
~urope and .lapan. Thus the idea of trilateraliam (North America,
~~C, Japan) gained ground.
2'hc reshaping of the Western "codetermination arranqement" in the
economic sphere, ahirh took on its initial form in the world economic
sunmit meetings, found its parallel in the qreater American readineg~
to coordinate its foreiqn policy and, to an inrreasinq deqree, its
serurity and disarmament policies. The NATb Council has thereby been
given a w~lcome ahot in the arm. On several occasions, NATO sessions
have taken place aitt~ the participation of national and qovernmen~al
leaders.
Although the Big Pour meeting in Guadeloupe at the beginning of 1979
was looked upon as an informal e~cchange of opinions without there beinq
an intention to deal with institutionalization, nevertheless its
sumnoning made plain how strongly the necessity is felt to coordinate
policies on a partnership basis, and it made it clear also that above all
the President of the United States considers important a deepened
exchange of ideas with West Europe even in the prelitainaries to political
decisions. Now the new cooperation structures between North America,
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W~gt ~urop~, a~d ~ap~n wi11 fin~ily pr~gen~ t,herngelveg in c�~ngoiidated
fdrm, end wh~thc~r eh~ ~x~~ting organization~ wili b~ r~~drm~d or wili
t~t gupi~lamc~nted by dtherg, rannot now bd pr~ci~~ly forc~ec~~n ae y~t.
~nlieic~l ~hifeg in ~m~ha~ig, th~ integr~eion nf n~w d~e~rmining faeeor~
inte the international ord~r, fr.equently take plac~ on~y glowly and
in a dialacticai pr~~~g~, ~inC~ ~.h~r~ ar~ many promoting, inhibitin~r,
and enunt~rac~ing fo~c~g at work. ltow~ver, ~h~ main ~r~nd ig ~lr~~dy
now parc~ivabl~: ~n ~h~ er~nor,~ic and polieirai g~C~c~r~ it boil~ down
eo ~ gr~ater p~rticipating of th~ W~gt ~urop~an~ anc~ Jap~n~~~ in th~
W~st~rn d~ci~ian-making proc~~~, eo ~ mor~ ~xt~n~iv~ "pol~cy-~haring"
betw~~n North Am~rica, th~ ~EC, and Japan.
A~ fnr Wegt Europp, t.he ~E~ and it~ foreign policy compcment--the
~uLap~an polieical Cooperation (~P2) crgan3~a~ion--ha~ by now a1r~~dy
develop~d into an organixationel foundation for co~~e~rmin~eion.
Fr~nc~, ~r~~t grieain, the ~'ttG, or italy in th~ir re~p~c~ive inc~iv.idv~l�
rni~s dd net ~rovide the w~iqht whi~h 1~gitimiz~g ehig Cl~im tic~
partieipaeinn. What i~ decigive ig the fact that th~ ~~C partn~rg
ar~ uniting th~ir wpighti and their vniceg. bnly jointly can the ~~C
call into play the influenc~ of ~urope. iz ig tih~refore not by chanr~
- th~t the ~~C--r~pr~s~need by itg rouncil and commigsion pregidentg--
ig tiaking part in th~ world eronomic summit meetingg. The more e�feceiv~
the ~P~ becomes, th~ greater will b~com~ the pressure to include it
a$ w~11 as an institution connected with the Wegtern coordination of
_ poliei~s. On1y when thig point is reached has the ~urop~an-American
diaingue r~ached that level which corresponds to the requirements of
the world situation and of European unification. A prerequisite for
We~t Eurone's continuinq and growing role in the wo~ld ~conomy and
world politics is th~ inner developm~nt of the ~~C. 7'h~ ~uropearn
Monetary Sygtem and the scheduled direct elections (for the European
Parliament~ will bring substantial advancements in 1979. increasing
prosperity in the EEC and the new stimulants to European inteqration
will also ensure qreater political stability in Europe. 8ut qreater
stability will also increase the political impact of the EEC. This is
becoming apparen~ even today in its attrartivenesg to ~hoge countries
of Southern ~urope which went tn become members, in its relationg with
thc countries of the Mediterranean area, Africa, A~ia, and the
Caribbean, and also in the creation of the EPZ. 8y means of this
instrument, the ~~C end its member nations are more and more convertinq
t~heir ~conomic and political weight into jointly exerted political
influence.
The Growinq Zmportance of Japan
The rise of Japan to the position of a leading industrial nation is
one of the most note~+orthy events in mere recent economic history. -
Today, Japan's share of the world trade is 9 percent. From 1960 to
197E3, its sharQ fn the qroas national product generated in the OECD
sector rose from S percent to 14 percent. Japan is today the economic
center of gravity of the Far East. Hawever, the rapid economic
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developm~nt o~ ~apan w~~ no~ withou~ probl~m~ for th~ world ~conomy.
~in~~ ~h~ Japan~~~ ~cdnomic growCh wa~ borne to ~ signifi~anti extenti
by itig exporti~~ ~urplug~~ 1n th~ curren~ account balance aroee which
er~~~~d di~equilibria. Th~r~for~ Japan i~ today facecl with tihe taek
of ~hifeing itig ~mpha~i~ ~o the advancem~nti of itig internal growth, of _
purchasinq more good;~, and of exporting cap3tal.
Up to now~ Japan hag shied away from making politicai uae of its aconomic
~tr~nqth. Only racpntily doe~ it ~eem to hav~ been exerting a more
political influenc~, such as in it~ turn towardg the AS~AN CAegociation
of Snutheagti Agien Na~ion~) countrleB, in th~ Japane~e-ChineBe aqreement,
and in ft~ cloger rela~iong with Australia and New Zealand. The
politi~al influenc~ of Japan in the Far ~agt will increase, ~specially
when ~~pan succeeds in ~stabliahing a better bniance in ita foreign
~CAflAfi~C relations. ~ven vis-awis the United State~, th~ exchange-ra~e
~hift~ di the yen te~ ~h~ dollar are ~ikely to be in the directi3on of ~
~tr~~qtheninq the political position of Japan. Thig will not adver~ely
aff~~t the clos~ coc'p~ration betwp~n the two countries. 8ut the
in�luenre of tihe yen wi11 impart more weight to the Japanesp voice
in Washington. The triangl~ Am~rica-Europe-Japan can only profit
from this.
The Third Worid as a power F'actor
Among the developing countries, a twofold movement can be observed:
--the economic advances of the developinq countries as a whole, and
--the incre~sing differentiation in the economic development of these
countries. -
After being released into a state of independence, the young nations
of Africa and Asia wanted to stand on their own feet economically ag
well. This movement was finally joined by the states of Latin Amerfca
whirh wanted to free themselves from the influence of the United States,
this being felt by them to be oppressive. Economic development was ~
ta make possible political emancipation, and independence--nonalignment--
was to promote economic growth. Up to the beqinning of the 1960's,
the developinq countries sought to obtain the economic aid which was
essential to this end in a bilateral nwnner and on the basis of their
nonaliqned status, in connection with which their positional value was
seen against the backqround of the East-West antaqonism. To the extent
that the East-West confront~tion was diminished and the process of
detente got under way, the political positional value of these countries
declined in terms of the East-West constellation. The consequence was
that the deve~oping countries were now anxious to collectively give
effect to their interQSts as the qroup of the nonaliqned or the "77"
countries. They utilized the United Nations and their majority there
as the political instrument for the pursuit of their interests.
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~~tw~en 1950 ~nd 1975, th~ gr~~~ n~tiional produc~ of tih~ d~v~loping
~c~untr,L~~ incr~a~ed mor~ than fourfold. Neverth+al~~~ tihe ~conomic and
thus also th~ politlcal weight of the developing aountiries remained
~light up to the b~ginning of the 1970's. Thi~ situaCion chanqed wi~h
the oil cr3sis, which showed for th~ firge eime what a det~rmined ~etiion
k~y a group can bring about. Not till naw did developinq coun~rias g~~
politiical influ~nce, either directly as oil gupplierg or indirectly
- as countriQa affected by the oi1 price increaae and thu~ ag ~iotien~ial
allipg of the indus~rial oil consum~rs. Tha political trSumph nf the
d~veloping countries in th~ oi1 crisi~ ati the game ~im~ laid bare the
areag nf inter~st nf these countirSeg. Since then, the OP~C countries
have been clearly distinguish~d from the rest of the developing countries.
E3eside~ the oil countries, those countries with intermediate incomes ~
which boast of the highest growth rates are ~lso makinq themaelveg
felt mor~ and more. For theae cauntries, what is important in the
futur~ is no longer so much developmenti aid as it i~~access to the
capital marketis. ~specially prominen~ in this grcup are the so-called
thr~shold countrie$--countries which along with persisting relatively
low per-capitia incomes are in certain areas, such as in steel and
eextiles, quite competitive. Among these are for example Brazil,
South Korea, and Mexico. This development already tonk place before the
oil crisis, but it was only in the recesgion which emerged in the wake
of the oil crisis that it became especially clear, because the
industrial countries then beqan to feel their competition much more
strongly.
Oil countries as well as threshold countries are awakenfng more and
more to the responsibility which they bear for the development of the -
world economy and thus also for political stability in the world.
The Western industrial nations ought to help these countries to live up '
t~ their responsibility. The effective way which they can help them
in this connection is to resist protectionist measures, which prevent
these countries from playing an increasing role in the world economy
and with that also in world politics. This should not exclude temporary
protective measures in special cases, such as for example in the
textile fndugtry. What is important is that the path to an increasinqly
more substantial participating of these countries in the world economy
is not blocked.
What has been l~cking so far is an institutionalized recoqnition, so to
speak, of the changed role of these countries. An initial attempt
in this direction was the North-South dialogue in Paris. Another path
is now beinq taken for the first time fn the OECD on a trial basis:
Certain developinq countries are to take part in the work of the newly
established steel committee. In the IMF, Saudi Arabia has been qranted
the position of an executive director. On the side of the developing
countries there stands in the way of a comprehensive solution their
worry about a possible schism, and in the industrial countrfes the
hindrance is their concern for the workability of their own consultative
_ mechanisms. It would be a step fosward ff the basis could be broadened
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end i� in th~ futiur~ dialogue could be aarried on mor~ ex~ensively
through ~h~ agency of th~ ~EC. ~'ollowing the atructuring of the rela~ionship
of the ~EC to the ~o-called AKP (A�rica-Caribb~an-Pacif3c) nations 3n -
the Conventiion of Lnme, the cooperation agreements between the EEC
and itg southern neighbors on the Meditierranean, the Euro-Arab dialogue, -
and certiain agreements between the ~EC and South American nations,
- the lasti important step in this direction wa~ tit?e EEC-ASEAN ministerial -
- meeting in erussels in November 1978, at which a closer degree of -
coopera~cion wa~ agreed upon. in the Western industirial natiions there
is moreover a growing readiness to fashion, �rom the i8ea of an
int~gratied Raw-material Program with a Com?non Fund, an instrument for
more s~~ble raw-m~terial relations which is economically sensible and
acceptable to all the participants in the economic exchanges.
Position of Soviet Union and Eagti European Countries
Tho development of a more extiensive partic3pation on the part of the
Soviet Union and the East European countrfes in the world economy cannot
- be separated from the policy of detente. To be sure, even in the
~ime of the Cold War there were trade relations with East Europe, but
these were ratiher insiqnificant in scope. Even though the differences
between the economic systems were above all held responsible for this -
situation, nevertheless trade with the East was characterized by the
- primacy of politics: They did not want to become dependent on one
another, and they wanted ~o have the other side profit as little as
possible from their own economic resources.
The journey from the recoqnition of both superpowers that they could
eliminate each other only at the price of their own existence, up to -
the awareness of a jofnt responsibility by the West and the East for
- world peace, took its time. In the course of this development, the
political obstacles to an expa~~ded economic cooperation faded into the
background. Interest in Weste~cn capital, in Western technolc~gy, but
also in Western wheat won thrc,ugh. Industry in the West considerably
increased its commitment in East Europe. Since 1970, the commercial
exchanges of the state-trading ^ountries with the Western industrial
countries have increased fourfola (although their share in the total
commercial exchanges have changed only slightly). This trade grew
more rapidly than the trade of the CEMA countries with each other.
,
If economic cooperation was a precursor of detente to begin with, then
detente is unthinkable without a development of economic relations.
The Soviet Union is thereby assuming a bit of the responsibility for
the "capitalist" world economy. The most striking sign of this change
is the borrowing from euro markets, which meanwhile is estimated to
amount to over $40 billion. Not only the interest r~tes in the
euro markets, but also the economic factors which affect the Western
capital markets thus become elements of the economic development of -
the state-trading countries: Price rises in the EEC and the United
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(
_ States, the American current-accounti balance deficit, the exchange rate ~
of the dollar--all this can no longer leava them indifferent. Therefore
it is only loqical if the Weat increasingly preasea for a atronger ~
participation by the Soviet Union ana the East European atates in the '
responaibility for the world econ~mic syatem, inclusive of developmental
~id. Thus, Federal Chancellor Schmidt declared, following the Biq
Seven meeting in Jamafca at the end of December 1978 in which na~ional ~
and goverrunental leaders fro~n indus~r3a1 and developing countries
took part, that witt? the approval of tl?e other participants, he wi11 ~
be supportinq a participatory role of the Soviet Union and the�East ~
European states in the Integrated Raw-material Program with the j
Cottun~n Fund. p
Today, the extent of the economic exchanges witt? the state-txading
countries is easentially limited by their requirements and their -
financing potentialities. They resemble the threshold countries with
respect to where their interesCs lfe. Even though trade with the East
makes up only 5.6 percent o� West German foreign trade--and only
3.9 percent of the trade of t2ie EEC--it would nevertheless be not only
economicalYy bu~ al.so politically a mistake to shield their markets
from competition from the state-trading countries. For the state- ~
trading countries of Ea~t Europe, trade with the West is an essential
element of their economic development. But for the West as well,
trade with the East rema?ins important. Here also what needs to be done
is to help the East European countries with their diffiCUlties in ~
adapting to the requirements of the Western markets, without sscrificing
the West's own interests. The conciliation of economic interests _
will also, if it does not lose sight of the qoal of the continually
greater integratfon of ~he state-trading countries into the world
economy, lend a new quality to the political relations between them.
This became clearly perceivable with the visit of the :.~viet national
and party leader, Leonid Brezhnev, to Bonn in May 1978: An economic
cooperation aqreement keyed to a 25-year period was concluded, and
in the "Joint Declaration" on this the interest of each side in the
economic well-being of the people in the partner country was emphasized.
There was no longer any talk about the economic downfall of the
other, but rather about mutual interests in a fruitful and stable
economic exchange.
_ The Openinq Up of China '
~
The most recent decisions of the Chinese controllinq bodies to modernize
and to decentralize the economy of this most-populated country on
earth, to carry out with the help of the Western industrial nations
industrialization projects of great maqnitude, and to launch an extensive
technology transfer process, will have effects on international economic
relations and on investment and capital-market decisions by numerous
countries which are not as yet completely foreseeable. In view of *he
considerable raw-material reserves of China, international arrangements
;
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with reapeat to raw-material policies wi11 be 3nfl,uenced in the longer
run. The increasing intertwinemen~ of China's interests with the
Westiern national economies will lead ~o closer political relatiiona and
wi11 have a atabilizing effecti. China's own interests in orderly,
peace�ul internat.ional condit~ons will grow. Witih a rising produc~ion
capacity with respect to exportiable gonds, China wi11 become an
important economic center of gravity 3n Asia--something which will also
have ~olitiical consequencea.
Long-range Trend: More ~ntegration
In the long range, developments are tendinq toward a qreater i~ntegrating
of the world economy. The key word "interdependence" aptly charac~erizes
these developments: The industrial countries naed the developing
countiries not only as raw material suppliers but also as sales outlets,
and the developing countries want to sell their raw materials and
finished goods in tt~e industrial countries in order to be able to
finance their economic build-up. The state-trading countries need
capital goods and technical know-how for their eaonomic development
in exchange for raw materials and finished goods. Of course, all of
this was already the case earlier. What is new is the intensity with -
which developinq countries and state-trading countries are taking part
in world trade, and what is new is the qrowinq interest o� the industrial
countries ~n these markets. The growing extent of theae economic
exchanges also creates greater areas of friction. Therefore the
adjustment processes have to be carefully directed. A more clear
revelation of the economic processes and trends, a better exchange
of information, more consultations, a facilitatinq of the direct
activities ~f the enterprises, and facilitation of cooperation aaiong
enterprises can all decisively help here. The deepening and spatial
extension of the policy of detente, the creation of regional structures
for promoting peace and cooperation, and the s~-xengthening of the -
� United Nations would promote the construction of a world economic
system which would tak~ more into account the requirements of our
modern times and the political as well as the economic and social rights
of people.
COPYRIGHT: 1979 Verlag fuer Internationale P~litik GmbH, Bonn
12114
CSO: 3103
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I~(llt (1i~'P'TCiA~~ USC ON1~Y
W~ST GCItMANY -
I)I.li'1'5, CINANCCS OC MAJOR PARTI~S EXAMINEb
Il~nmbur}; S'I'IsltN in Crrmnn 1 Ceb 79 pp 146-148
~Arciclr hy WoIE l~erdalwitz; "Tn Che Shadow of Impending Bankruptcy--
I~cnir� liunclr.~ta~; I'arttes 60 Million Marks in Che Red--New Tax-ExempC
Contril~~iCinns 'Cn Muke Their 'rrcasuries Solvent Again"]
~Tex~~ Wrst Cerm.~n purtirs in the next two years will invest ~ good 400 -
millic~n m.hrks in vote-~etting. In prospect are six Landtag elections,
tlie Lurope election, and finally the nundesCpg election. The hunC for
money in a11 instances precedes the hunt for voters. For no party can
pay From iCs savings for battles in which mater iel is the deciding
f~~ctor. At the moment they have only debts: the four parties of the
f~undestag are in the tick to banks and suppliers for 60 million marks.
The SPD ia in the lead for more than 30 ~illion. But 1ts oohorts can
eleep sound~jr. They still hsve oonsidarable aaaeta in re~l eeta~te and
industrial imestmenta. In oontrast, thit~s look very black for the
second large popular party~ the CDUs the Christian D~ocrats are broke.
Sin~e liabilities eacceed asseta by 20 willion me~rka, psrty chief Ne]anut
Knhl~ in atMet acoorrcjsanee with the lax, ahould aetue~l~q he~ve filed for
bankruptcy. Zbr are thinga gc~ing Nsll for ita alater party~ the C9U. It
is aitting on unpaid bills and loane a~ounting to aore tt~n 6 willion
marks. Only the FDP. for the firat ti~e, ia rid of ita xorat xorriee.
It is ~uat under 2 million marka in debt. Fbwc yenrs ag+o the debt xaa
still 11 million.
The financ:ial diatreaa of the partiea be~sn txo yee?rs ago and becaae
- catastroph.tc in 19?8. F~op~ 19?6 to 1977 the public~jr re~ported inoome of
the four ~ies alipped dramatical~jr s 1na ~~sd of 355 ~nillion u~rks ~
on~y 247 million in oontributions, me~bera' dues and public election-
_ campaign asalatance poured into ~he party xar ahests. ilest Cer~ae~n citi-
zeng and enterpMses had beco~e Meary of contributing. And laat year
lethnrgy of oontribution firssl]y erupted. In 1976 the four tresaurers hsd
still collected a little lesa thsn 100 aillion aarks in eharitdble gifts.
A year lster it h~d at lee~at still bee~ 44.4 a~illion.
. 34
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The loN point then Nas 1978. The party tree~aursrs opened up thsir bulance
- sheets to 3TII~N. Friedrich }i~latenberg (3PD) s"800~000 ~narka Heinz
Harbert Ka.rxy (P`DP): "A very bad years" Karl-Hsins spiiker (C9U): "A con-
siderable decline in large contribution~;" Uwe Iueth~e~ repreaenta~tive of
Walther Leieler Kiep (CDU)s "Less the~n 2 million."
.
There Nas ree~on for contributor~ to ho3d be~ck: for more than a yeeuc 1~
public proeecutora' offices aoroaa the republio have been inveee~tigating 105
ca~es against firms and indu$trialieta. Thqy euppoaed~y in yeara before had
- aoted to benefit the CDU and to hax~m the state: they xere ahsrgsd. with tax
evasion. The beat krawn victi~ of the arimitml invsati~tion: Nikolaus
Fhsolt. a Bonn tile manufacturer. Short~j? after the inveati~tione beoame
knoNn~ he resigned aa preeident of the Federal Union of Ge~r~an Induetry.
Fgsolt tmul placed four orders for expert opiniona, each for 10~000 marks,
from the "Paxro ean Businesa Advisory Inetitute~" heddqusrte~red in Vadu$
(Liechtanetein~. In the opinion of the tax euditor they xere xorthless.
_ F~aolt. nonetheless~ entered them as taac-deduatible operating expsnaes in
the balanee aheets. After deduotion of expen~es, the sonepr l~nd been trans- -
mitted from Vaduz to the CDU's oNn "Union Ala~nageAent Oorporation" in Bonn.
Among the 105 purchasere of auch e~xpert opiniotus from Vaduz xere the best
' names in the German eoonon~y. In the opinion of the tdx investip,stora,
this operation brought in a g~ood 3 eillion marks for the CDU. _
31nce the roused public proseautors he,ve been kracking at the executive
~uites of proainent bu~sineasse~ rendinees to make generoua oontributions
he.9 slwnped abzvpt~jr at all parties � expense, for thia way of helping
~ party financial~jr and aaddling the taxpa4Yer xith hslf the oost aa
"operational expenditurea" had not been eocclwsive~}? a Chaciatisn De~wcrat
racket. Thus, in Mainz the FDP-affiliated "Aasociation for Opening up
Urderdeveloped Markets Inc. " collected tax-deductible duea t~~ ~nembers.
Matters were more direot in the case of the SPD. Bundlea of eaah changed
oMner right across the table. Albert Ossxald~ fora?e~r Hesaian prine nin-
- ister. shamefacediy called the gifts "charitable loans." ~'he aeesenger
camr to thc house of Rudi Arndt, former mayor of Frankfurt,
with a suitcaae of money and delivered altogether 1 nillion ms~ka
donated by the Berlin building oontrsctor Karaten ~ingbeil, xho oeca-
sional~jr helped out the Union too. Nhen Berlin CDU politieisn Petsr
Lorenz was abduoted bpr terroriets. the kidt~e,per~ fou~nd in hie xallet a
check t~om IQingbeil that had not yet been cashed.
At the latest, since Fgsolt�s doxnfall and the decline in contMbutions
the~t it triggered, the politicians have been racking their brains again
over hox they ca.n put their org,~ni~ations on a solid financial bnsis Mith-
out at the same time reviving the old sax about the "atate as the pdrties'
- self-service store."
Parties today have beoome sodern and expensive service operations. They
have the constitutional task of a.saieting i~1 "forraing the political xill of
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ro~ o~rzc~~, usc ornY
the people~" hence.o~ casting light on politica], avente and expanding
polltical eduration. They are aupposed to enlist new recruits for parlia-
ment and Nin over oitizens for ths atate. They ara euppoeed to influenoe
developments in perllaN+ent and g~oWerrunent and leave their iMprint on the
~ way the g~ovsrnment does businees. In comparison Nith these tasks there
is by ].aW only very meager inoome: at moet 3.50 ~aarks per elsction per
vote. In addition every meaaber and every patron may annually deduct fYom
taxes up to 600 marks of dues and oontributions.
Nevertheles~, anprboc~y who Wants to coni;ribute more than 20~000 marks xuns
the risk of having his ttia~ee and addreas published in the BUNDFSANZEIGIIt
_ [Federa.l Cazette] (this is xhe,t the law on parties has required since
1967). And resourcef~l people promptly found xays of avoiding the painful
naming of oontributors. Sometimes large contributiors xere aimply de-
clared to be "anot~prmous." ~nd-raisers like "National Citizens Asaoaia-
tione" or the Dueren tax adviser Werner Hintzen acted as i~ter~ediariea in
- order to keep the actual contributor in the baokground. Fbr in party
financing, "Do good and don't talk about it" appliee.
A first attempt to finance parties in a sounder and tidier fas hion Mas the
proposed establislvaent of a common fund in xhich all aontributions should
be aollected for subsequent proportionate distribution to the parties. The -
plan collapaed last aute~mn because the CDE ~+anted~ by means of a loophole, -
to incorporate in the concept a belated aa~neety for earlier tax offenders. :
The next attempt was the proposed increase in the tax-deductibility of
contributions~ on xhich there xas agreement in prinoiple among the parties
of the Federal Assemb~y. On~jr the amount remained in dispute. The Union
would xilling~jr up the previous]y alloxed 640 marks to 10~000 marks. The
~D~ hoxever, xhich had rather live on small contributions~ xas unNilling ~
to exceed a limit of 3~000 marks. ~ The treasurers xill pmbab~jr settle~
albeit grimly, on 4,500 marks. 3PD's t~lstenberg: "That doesn't help
at all. Neither Mr Kaxry nor Mr Kiep, Mr S~ilker or I accept 3,000-mark
contributions at a11" but higher ones~ of oourse~
Fina.l~y~ a oonstitutional appeal from the Ia.nd of Niedersachsen aims at
total freedo~a: Since contributions for "publia~ scientific or cha.ritable
purposes" are tax-deductible almost xithout restriction. the donstitutional
Court should consider whether the limitation on contributions to parties
- accords xith equal trentment. A decision of the Federal Oonstitutiorjal
Court is anticipated next summer at the earliest. Fbr that redson there
will be no cleering axay of the financing thicket before then. Federal
Chancellor Helmut 3ctnnidt to his intimatess "Until there is a nex legal
- ruling, We'll 3ust xait Karlsruhe out."
There is much more to rule on at the saae �time. Fbr parties, after all, it -
is not 3ust "contributions" thet are in the txilight zone. Other income
might not withstand too strict investi~ation~ eithex.
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t'OR OF~I~?AL U3E ONLY
Thu~ the ~'edsxel Oonsti~utional Oourt aa ear]y sa 197y d~ol,ar~d it irp~r~ia-
_ aib~a for psrtiee~ as for sxa~pls ths ~PD~ to dip into ~hr poak~t of th~ir
own parlis~ente?ry a~bsre. ~re~cy 9ooiol Dwoare?t ~~wbsr of parliar~nt ~n
Bonn ~on~Eributed~ so~stiaee far ~ore th~t? 100 ~trke s Nonth~ to th~ itdir~at
g~oyerru~sntal finsnainec of hia parttiy bpr ooapuLory oontributione and roYs
or lesa voluntary drdu~tion~ frox hie stats-paid p~or+-dia aliowa�o~.
There hsve b�en no Nore of thses co~puleory oontaribution~e rincs the xsrla-
~vhe deaial,on~ but there has rat b~en ntah otsnge in t!w suppl~~ntasy
inco~e of 20 ~i111on niaarks a year for ths :four psrt~se in tl� Fedsri?1
Asseo~b~y. The parlie,nentary aeaber's ersll oontxibution is now p~?id
"voluntari]y." Ar~y baak..bsnoher xho Would dars not to pey ~~ut b~ pr~
pared not to be retamindted in the next slsotioe.
Also in the twilight ~one is the finsncial oonduat of partysff~liated
foundationss ths Kcnrsd Adene?utr Fbundation (CDU), ths Rrisdrioh ~b~rt
Fbundation (S~PD), the ~Yiedrich N~uaat~n Fbundation (P'D~P) and Lhs H~nns -
3eidel Fbundation (C3U). 91nce they are reo~gni~~d as ron-profit organ�
izations~ they can o�fsr largs oontributora ~ahdt ia deni~d to thsir ~o~l~r
peuctie$: tax exes~ption. Md th~t pa~ye. Fbr big oontributors ars sLNOSt
always big esrnsre Nho have to pasa on about hnlf of th~ir inoo~~ tfl ths
g+ove~ruaen~;. Thus the state pe~ys hdlf of wea~y 100,000��~ark oontribulion.
"The significancs of fow~datione for parties~" Writ~a psrty reeearaher
H~nning von Vieregge~ lies pri~aari]ar in the fsat thst tMy "recsive
go��ernment a~oney xhich for lsg~l reaaone a'?n no lor~r oo~s to ths
parties fro~ governa~ent budgeta." lbre than 200 a~11ioA ~arka a y~sr~
- xhich in addition is not eat~marked.
Thus the foundations can aecret~y help their ~othsr partiee. Tt?~ "Frei-
burg Program" of the FDP~ for e~aple~ ~,iaa printed st~d diatributed bpr ths
" Friadr~ch N~w~ann Fbw~dation. FDP Tressurs~r Katzy: "Ons ~ust haa to
think devious]y eo as to saddle others aith xt~st ons xould otha~iae hdve
to pay for oneself."
OOPYRICNTs 1979 Cruner+Jahr AQ dc Oo.
6474
cso: 3103
(:Nb
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