Diplomacy beyond deterrence: Helmut Schmidt and the economic dimension of Ostpolitik

ABSTRACT

The military aspects of Helmut Schmidt’s policy have been examined in depth. This article argues that Schmidt’s diplomacy went beyond deterrence. His Ostpolitik statecraft was aimed at the establishment of sustainable structures of cooperative security in East-West relations. It facilitated the strategic energy partnership between the Federal Republic of Germany and the Soviet Union. Schmidt’s economic détente outlasted the crisis of US-Soviet relations. The construction of the largest pipeline for the transport of natural gas from the Soviet Union to Western Europe in the first half of the 1980s (Urengoy–Pomary–Uzhgorod) helped to keep détente alive in times of crisis.

KEYWORDS:

• Détente
• East-West relations
• economic relations
• Ostpolitik
• Soviet Union

Notes

¹ For a comprehensive and the most recent account, see Kristina Spohr, The Global Chancellor: Helmut Schmidt and the Reshaping of the International Order (Oxford: Oxford University Press, 2016). See also Leopoldo Nuti and others, eds., The Euromissile Crisis and the End of the Cold War (Stanford: Stanford University Press, 2015); and Hartmut Soell, Helmut Schmidt, Macht und Verantwortung, 1969 bis heute (Munich: Deutsche Verlags Anstalt, 2008).

² See Helmut Schmidt, Menschen und Mächte (Berlin: Siedler Verlag, 1987).

³ There will be more research on pan-European trade evolving from Federico Romero’s multinational project on the socialist regimes of the Warsaw Pact states and their policies in terms of cooperation with the European Economic Community. For a succinct account of its research agenda, see Angela Romano and Federico Romero, “European Socialist Regimes Facing Globalisation and European Co-operation: Dilemmas and Responses,” European Review of History 21, no. 2 (2014): 157–64. The project is funded by the European Research Council under the European Union’s Horizon 2020 research and innovation programme. It is titled “Looking West: The European Socialist Regimes Facing Pan-European Cooperation and the European Community (PanEur1970s)”; see https://paneur1970s.eui.eu/ accessed 14 December 2017.

⁴ See Angela Stent, From Embargo to Ostpolitik: The Political Economy of West German-Soviet Relations, 1955–1980 (Cambridge: Cambridge University Press, 1981); and Werner D. Lippert, The Economic Diplomacy of Ostpolitik: Origins of NATO’s Energy Dilemma (New York: Berghahn, 2010).

⁵ See Stephan Kieninger, The Diplomacy of Détente: Cooperative Security Policies from Helmut Schmidt to George Shultz (London: Routledge, 2018).

⁶ See John L. Gaddis, The Cold War: A New History (New York: Penguin 2005); and Melvyn P. Leffler, For the Soul of Mankind: The United States, the Soviet Union, and the Cold War (New York: Hill & Wang, 2007).

⁷ See Oliver Bange and Poul Villaume, eds., The Long Détente: Changing Concepts of Security and Cooperation in Europe, 1950s–1980s (Budapest: Central European University Press, 2017).

⁸ See James E. Goodby, “Diplomatic Cathedral-Building,” The Foreign Service Journal (September 2002): 71–5.

⁹ See Per Högselius, Red Gas: Russia and the Origins of European Energy Dependence (Basingstoke: Palgrave Macmillan, 2013).

¹⁰ See Angela Romano, “Untying Cold War Knots: The European Community and Eastern Europe in the Long 1970s,” Cold War History 14, no. 2 (2014): 153–73; and Arne Kajser, Erik van der Vleuten, and Per Högselius, eds., Europe’s Infrastructure Transition: Economy, War, Nature (Basingstoke: Palgrave Macmillan, 2016).

¹¹ For a most recent study, see Richard Moss, Nixon’s Back Channel to Moscow: Confidential Diplomacy and Détente (Lexington: University Press of Kentucky, 2017).

¹² See Gottfried Niedhart, Entspannung in Europa: Die Bundesrepublik Deutschland und der Warschauer Pakt 1966 bis 1975 (Munich: Oldenbourg Verlag, 2014).

¹³ See Egon Bahr, “Preface,” in Der geheime Kanal. Moskau, der KGB und die Bonner Ostpolitik, ed. Wjatcheslav Kevorkov (Hamburg: Rowohlt Verlag, 1995), 9.

¹⁴ In May 1974, Schmidt informed Brezhnev of his decision to have Bahr continue the backchannel on his behalf. See Letter from Helmut Schmidt to Leonid Brezhnev, 16 May 1974, in UdSSR, vol. 1, 1968–1974, Doc. 5a, Archiv Helmut Schmidt Hamburg (AHSH).

¹⁵ Egon Bahr, Zu meiner Zeit (Munich: Blessing Verlag, 1996), 333, 464.

¹⁶ Memorandum of Conversation between James Callaghan and Helmut Schmidt, 24 April 1978, in PREM19/1655, The National Archives, Kew (TNA); see http://www.margaretthatcher.org/document/111594 accessed 1 November 2017.

¹⁷ Handwritten Notes by Helmut Schmidt, 5 May 1978, in UdSSR, vol. 3, 1977–1978, Doc. 17, AHSH. The transcripts of Schmidt’s conversations with the Soviet leadership are edited in the Akten zur Auswärtigen Politik der Bundesrepublik Deutschland (AAPD). See Institut für Zeitgeschichte, ed., AAPD, vol. 1978 (Munich: Oldenbourg, 2009). The document volume is available online. See https://www.ifz-muenchen.de/aktuelles/themen/akten-zur-auswaertigen-politik/open-access/ accessed 22 June 2018.

¹⁸ Reinhild Kreis, Diplomatie mit Gefühl: Vertrauen, Misstrauen und die Außenpolitik der Bundesrepublik Deutschland (Munich: De Gruyter, 2015), 11.

¹⁹ For a comprehensive account of Eastern Europe’s debt crisis, see Fritz Bartel, “The Triumph of Broken Promises: Oil, Finance, and the End of the Cold War” (PhD dissertation, Cornell University, 2017).

²⁰ Oliver Bange and Gottfried Niedhart, eds., Helsinki 1975 and the Transformation of Europe (New York: Berghahn Books, 2008); and Poul Villaume and Odd Arne Westad, eds., Perforating the Iron Curtain. European Détente, Transatlantic Relations, and the Cold War 1965–1985 (Copenhagen: Museum Tusculanum Press, 2010).

²¹ See Oliver Bange, “Ostpolitik: Etappen und Desiderate der Forschung. Zur internationalen Einordnung von Willy Brandts Außenpolitik,” Archiv für Sozialgeschichte 46 (2006): 713–36.

²² Helmut Schmidt, Address at the World Economic Summit in London, 3 June 1977, in Eigene Arbeiten, April 1977–May 1977, Doc. 19, AHSH.

²³ See Daniel C. Thomas, The Helsinki Effect: International Norms, Human Rights and the Demise of Communism (Princeton: Princeton University Press, 2001); and Sarah B. Snyder, Human Rights Activism and the End of the Cold War: A Transnational History of the Helsinki Network (Cambridge: Cambridge University Press, 2011).

²⁴ See Oliver Bange, “The Greatest Happiness for the Greatest Number: The FRG and the GDR at the Belgrade CSCE Conference, 1977–1978,” in From Helsinki to Belgrade: The First CSCE Follow-Up Meeting and the Crisis of Détente, ed. Vladimir Bilandzic, Dittmar Dahlmann, and Milan Kosanovic (Bonn: Vandenhoeck and Ruprecht Unipress, 2012), 225–54.

²⁵ See Helmut Schmidt, Die Deutschen und ihre Nachbarn (Berlin: Siedler Verlag, 1990), 480–4; and Dominik Pick, Brücken nach Osten: Helmut Schmidt und Polen (Bremen: Edition Temmen, 2011).

²⁶ In June 1974, Brezhnev reminded Honecker that the GDR’s relationship to the Federal Republic ‘was associated with the national question, the proletarian question, the social question and the fight for socialism against imperialism. Everything is interwoven.’ Memorandum of Conversation between Leonid Brezhnev and Erich Honecker, 18 June 1974, in Dokumente zur Deutschlandpolitik (DzD), Series 6, vol. 3 (1973–1974), 624 . For the GDR’s policy in the CSCE process, see Anja Hanisch, Die DDR im KSZE-Prozess, 1972–1985. Zwischen Ostabhängigkeit, Westabgrenzung und Ausreisebewegung (Munich: Oldenbourg Verlag, 2005).

²⁷ For the context, see Herman Wentker, Außenpolitik in engen Grenzen: Die DDR im internationalen System (Munich: Oldenbourg Verlag, 2007); and Heinrich Potthoff, Im Schatten der Mauer, Deutschlandpolitik 1961–1990 (Berlin: Propyläen Verlag, 1999).

²⁸ See Memoranda of Conversations between Alexander Schalck-Golodkowski and Karl-Otto Pöhl, 31 July 1974 and 27 August 1974, in DzD, Series 6, vol. 3 (1973–1974), 667–72, 692–9. Schalck-Golodkowski was the GDR’s principal hard currency fundraiser; Pöhl was undersecretary of state in the Ministry of Finance and a close confidant of Schmidt.

²⁹ Oliver Bange, “Keeping Détente Alive: Inner-German Relations under Helmut Schmidt and Erich Honecker, 1974–1982,” in The Crisis of Détente in Europe: From Helsinki to Gorbachev 1975–1985, ed. Leopoldo Nuti (London: Routledge, 2009), 230–43.

³⁰ See Gottfried Niedhart, “East-West Conflict: Short Cold War and Long Détente. An Essay on Terminology and Periodization,” in The Long Détente, ed. Bange and Villaume, 19–30 (27).

³¹ Memorandum of Conversation between Gerald Ford, Henry Kissinger, and Hans-Dietrich Genscher, 26 September 1974, in Records of the Department of State, Record Group 59 (RG 59), Records of the Office of the Counselor, Entry 5339, Helmut Sonnenfeldt, 1957–1977 (Helmut Sonnenfeldt Papers), Box 5, National Archives and Record Administration (NARA), College Park (MD), USA.

³² Memorandum of Conversation between Helmut Schmidt and Leonid Brezhnev, 24 October 1974, in AAPD 1974 (Munich: Oldenbourg 2005), 1344.

³³ See Niall Ferguson and others, eds., The Shock of the Global: The 1970s in Perspective (Cambridge, MA: Harvard University Press, 2011); and Elisabetta Bini, Giuliano Garavini, and Federico Romero, eds., Oil Shock: The 1973 Crisis and its Economic Legacy (London: Tauris, 2016).

³⁴ For the context, see Spohr, The Global Chancellor; and Emmanuel Mourlon-Druol and Federico Romero, eds., International Summitry and Global Governance: The Rise of the G7 and the European Council, 1974–1991 (London: Routledge, 2014).

³⁵ Memorandum of Conversation between Henry Kissinger and Gaston Thorn, 29 May 1975, in RG 59, Henry A. Kissinger Office Files, Box 11, NARA.

³⁶ See Mathias Haeussler, “A Cold War European? Helmut Schmidt and European Integration, c.1945–1982,” Cold War History 15, no. 4 (2015): 427–47.

³⁷ First version of the Marbella paper, dated 5 January 1977 (underlining as in the original), Archiv der sozialen Demokratie (AdsD), vol. 9302, Bonn, Helmut Schmidt Archiv (HSA).

³⁸ Rüdiger Graf, Öl und Souveränität: Petroknowledge und Energiepolitik in den USA und Westeuropa in den 1970er Jahren (Munich: Oldenbourg Verlag, 2014).

³⁹ Letter from Helmut Schmidt to Leonid Brezhnev, 29 May, in UdSSR, vol. 1, 1968–1974, Doc. 8, AHSH.

⁴⁰ Schmidt referred to the term ‘frisierte Finanzierung’. See Memorandum of Conversation between Helmut Schmidt and Alexei Kossygin, 29 October 1974, in AAPD 1974, 1367. See also Schmidt, Menschen und Mächte, 60.

⁴¹ See Paper by the Division of Economic Affairs in the Chancellor’s Office “Grundgedenkanken eines Kooperationsmodells für die deutsch-sowjetischen Wirtschaftsbeziehungen,” in UdSSR, vol. 2, 1974–1977, Doc. 12, AHSH.

⁴² Deutsche Bank provided the loans for the gas and pipeline deals. See Manfred Pohl, Geschäft und Politik: Deutsch-russisch/sowjetische Wirtschaftsbeziehungen, 1850–1988 (Mainz: Hase & Köhler Verlag, 1988).

⁴³ See Helmut Schmidt, Weggefährten: Erinnerungen und Reflektionen (Berlin: Siedler Verlag, 1996), 501.

⁴⁴ Letter from Helmut Schmidt to Leonid Brezhnev, 16 May 1974, in UdSSR, vol. 1, 1968–1974, Doc. 5a, AHSH.

⁴⁵ Note on a Conversation between Helmut Schmidt and Soviet Ambassador Valentin Falin, 20 May 1974, in AAPD 1974, 639–42.

⁴⁶ See Memorandum of Conversation between Willy Brandt and Leonid Brezhnev, 18 May 1973, in AAPD 1973 (Munich: Oldenbourg, 2004), 710–23.

⁴⁷ See Memorandum of Conversation between Willy Brandt and Vladimir Novikov, 18 January, in AAPD 1974, 64–72.

⁴⁸ See Memorandum of Conversation between Helmut Schmidt and Alexei Kossygin, 29 October 1974, in AAPD 1974, 1363–71.

⁴⁹ See Note by Hiss, the Director of the Division of Economic Affairs in the Chancellor’s Office, on Schmidt’s talks in Moscow (28–31 October 1974), 1 November 1974, in UdSSR, vol. 2, 1974–1977, Doc. 4, AHSH. See also Schmidt, Menschen und Mächte, 59.

⁵⁰ See Letter from Helmut Schmidt to Henry Kissinger, 18 October 1974, in AAPD 1974, 1322–5. Schmidt also sent the letter to French President Valéry Giscard d’Estaing and British Prime Minister Harold Wilson, see Politisches Archiv des Auswärtigen Amts, Declassified Documents (Bestand 150), Copies 1974, vol. 529. For COCOM’s policy, see Michael Mastanduno, Economic Containment: CoCom and the Politics of East-West-Trade (Ithaca: Cornell University Press, 1992), 220–33.

⁵¹ See Memorandum of Conversation between Hans-Dietrich Genscher, Henry Kissinger, James Callaghan and Jacques Sauvagnargues, 11 December 1974, in AAPD 1974, 1612–16.

⁵² Memorandum of Conversation between Helmut Schmidt and Vladimir Novikov, 12 June 1975, in AAPD 1975 (Munich: Oldenbourg, 2006), 725–36.

⁵³ See Note by Schmidt on his personal discussion with Brezhnev, 31 July 1975, in UdSSR, vol. 2, 1974–1977, Doc. 20, AHSH. Schmidt wrote the note on his typewriter at his vacation refuge at the Brahmsee on 12 August 1975. There were only two copies. Klasen possessed the second one, and Schmidt deliberately refrained from informing his cabinet. See also Schmidt, Menschen und Mächte, 78.

⁵⁴ Memorandum of Conversation between Helmut Schmidt, Hans-Dietrich Genscher, Leonid Brezhnev, Andrei Gromyko, 31 July 1975, in AAPD 1975, 1106.

⁵⁵ Letter from Helmut Schmidt to Leonid Brezhnev, 26 September 1975, in UdSSR, vol. 2, 1974–1977, Doc. 21, AHSH.

⁵⁶ See Letter from Leonid Brezhnev to Helmut Schmidt, no date, January 1976, in UdSSR, vol. 2, 1974–1977, Doc. 25, AHSH; See Memorandum of Conversation between Helmut Schmidt and Valentin Falin, 30 January 1976, in UdSSR, vol. 2, 1974–1977, Doc. 28, AHSH.

⁵⁷ Lippert, The Economic Diplomacy of Ostpolitik, 134.

⁵⁸ See Letter from Helmut Schmidt to Leonid Brezhnev, 7 July 1976, in UdSSR, vol. 2, 1974–1977, Doc. 35, AHSH.

⁵⁹ Memorandum of Conversation between Helmut Schmidt, Egon Bahr and Valeri Lednev, 1 November 1977, in AdsD, Bonn, Nachlass (NL) Bahr, 1/EBAA000954.

⁶⁰ Memorandum of Conversation between James Callaghan and Helmut Schmidt, 24 April 1978, in PREM19/1655, TNA; see http://www.margaretthatcher.org/document/111594 accessed 1 November 2017.

⁶¹ Note from Egon Bahr to Helmut Schmidt “Gespräch mit L[ednew],” 6 June 1978, in UdSSR, vol. 3, 1977–1978, Doc. 18, AHSH.

⁶² See Paper by the Foreign Office Desk for East-West Economic Relations, 2 June 1977, in UdSSR, vol. 3, 1977–1978, Doc. 6, AHSH.

⁶³ See Paper by the Soviet Union Desk in the Foreign Office “Besuch von Generalsekretär Breschnew in der Bundesrepublik,” 27 April 1978, in UdSSR, vol. 3, 1977–1978, Doc. 17, AHSH.

⁶⁴ Note by Engelmann, 23 March 1978, in Bundesministerium für Wirtschaft (B 102), vol. 257471, Bundesarchiv (BArch), Koblenz.

⁶⁵ Memorandum from Klaus Liesen to Otto Graf Lambsdorff, 24 April 1978, in B 102, vol. 257471, BArch.

⁶⁶ See Memorandum of Conversation between German business representatives and Nikolai Tichonov, Nikolai Patolichev, 5 May 1978, in B 102, vol. 240642, BArch.

⁶⁷ See Memorandum from Klaus Gaertner and Ernst Taubner to Friedrich Wilhelm Christians “Roehrenkredit bis zu DM 3 Mrd an die UdSSR,” 3 July 1978, in, 47, vol. 564. Historisches Archiv der Deutschen Bank (HADB), Frankfurt am Main, Zentralabteilung (ZA).

⁶⁸ Memorandum of Conversation between Friedrich Wilhelm Christians and Vladimir Alkhimov, 27 May 1978, “Bericht über die Moskau-Reise der Herren Dr. Christians und Dr. Taubner vom 21. bis 27.5.1978 von Matthias Hofmann-Werther,” in 47, vol. 564. HADB, ZA.

⁶⁹ See Kristina Spohr, “Helmut Schmidt and the Shaping of Western Security in the late 1970s: The Guadeloupe Summit of 1979,” The International History Review 37, no. 1 (2015): 167–92.

⁷⁰ Memorandum of Conversation between Helmut Schmidt, Egon Bahr and Valeri Lednev, 10 and 11 October 1979, in UdSSR, vol. 4, 1978–1979, Doc 19, AHSH.

⁷¹ See Vladislav Zubok, A Failed Empire: The Soviet Union in the Cold War from Stalin to Gorbachev (Chapel Hill: University of North Carolina Press, 2007).

⁷² Letter from Jimmy Carter to Margaret Thatcher, 14 January 1980, in Documents on British Foreign Policy Overseas (DBPO), Series 3, vol. 8, The Invasion of Afghanistan and UK-Soviet Relations, 1979–1982 (London: Routledge, 2012), 78.

⁷³ See Alan P. Dobson, US Economic Statecraft for Survival, 1933–1991: Of Sanctions, Embargoes and Economic Warfare (London: Routledge, 2002).

⁷⁴ For the context, see Daniel Sargent, A Superpower Transformed: The Remaking of American Foreign Relations in the 1970s (Oxford: Oxford University Press, 2015).

⁷⁵ Memorandum of Conversation between Margaret Thatcher and Helmut Schmidt, 25 February 1980, in DBPO, Series 3, vol. 8, 125.

⁷⁶ See Letter from Jimmy Carter to Margaret Thatcher, 10 February 1980, in PREM19/188, TNA, see http://www.margaretthatcher.org/document/112689 accessed 2 November 2017.

⁷⁷ Memorandum of Conversation between Margaret Thatcher and Helmut Schmidt, 28 March 1980, in PREM19/472, TNA; see http://www.margaretthatcher.org/document/129554 accessed 1 November 2017.

⁷⁸ On the manifold arguments between Schmidt and Carter, see Klaus Wiegrefe, Das Zerwürfnis: Helmut Schmidt, Jimmy Carter und die Krise der deutsch-amerikanischen Beziehungen (Berlin: Propyläen Verlag, 2005).

⁷⁹ See Bahr, Zeit, 506; Kevorkov, Der geheime Kanal, 246–9. Bahr also informed Schmidt’s foreign policy adviser Berndt von Staden. See Note by von Staden to Huoncker, the Chief of Staff in the Federal Chancellery, 2 January 1980, in, UdSSR, vol. 5, 1979–1980, Doc. 4, AHSH.

⁸⁰ See Werner Lippert, “The Economics of Ostpolitik. West Germany, the United States, and the Gas Pipeline Deal,” in The Strained Alliance: U.S-European Relations from Nixon to Carter, ed. Matthias Schultz and Thomas A. Schwartz (Cambridge: Cambridge University Press, 2010), 65–81.

⁸¹ Memorandum of Conversation between Egon Bahr, Valeri Lednev, and Wjatcheslav Kevorkov, 16 February 1980, in UdSSR, vol. 5, 1979–1980, Doc. 11, AHSH.

⁸² Memorandum of Conversation between Margaret Thatcher and Helmut Schmidt, 31 October 1979, in PREM19/59; TNA; see https://www.margaretthatcher.org/document/117715 accessed 1 November 2017.

⁸³ Note by Schmidt’s chief economic adviser Horst Schulmann, “Vermerk über das Gespräch mit Vertretern der Wirtschaft und der Gewerkschaften,” in AdsD, HSA, vol. 8881.

⁸⁴ See Report by Axel Lebahn, the Head of Deutsche Bank’s branch in Moscow, on the visit of Friedrich Wilhelm Christians, 6–8 February 1980, in Papers of Hans-Otto Thierbach (Vorstand 05, vol. 006), HADB, ZA. On the background, see Friedrich Wilhelm Christians, Wege nach Rußland: Bankier im Spannungsfeld zwischen Ost und West (Hamburg: Hoffmann und Campe Verlag, 1989), 90–7.

⁸⁵ For a comprehensive account, see Nicholas Evan Sarantakes, Dropping the Torch: Jimmy Carter, the Olympic Boycott, and the Cold War (Cambridge: Cambridge University Press, 2010).

⁸⁶ Note from Egon Bahr to Helmut Schmidt “Gespräch mit L[ednew],” 10 April 1980, in UdSSR, vol. 5, 1979–1980, Doc. 18, AHSH.

⁸⁷ Note from Egon Bahr to Helmut Schmidt “Gespräch mit L[ednew],” 10 April 1980, in UdSSR, vol. 5, 1979–1980, Doc. 18, AHSH.

⁸⁸ “Privataufzeichnung von Staden, 30.6. – 1.7.1980,” in UdSSR, vol. 6, 1980–1982, Doc. 1, AHSH. Schmidt noted that the members of the Politburo were ‘irritated but not offended’. See Schmidt, Menschen und Mächte, 116.

⁸⁹ For the text of the joint communiqué of 1 July 1980, see AdsD, NL Bahr, 1/EBAA000955.

⁹⁰ Memorandum of Conversation between Helmut Schmidt and Leonid Brezhnev, 1 July 1980, in AAPD 1980 (Munich: Oldenbourg, 2011), 1048.

⁹¹ See Memorandum of Conversation between Helmut Schmidt and Leonid Brezhnev, 24 November 1981, in AAPD 1981 (Munich: Oldenbourg, 2013), 1837–47.

⁹² See Statement by Klaus Liesen, Press Conference Ruhrgas, 20 November 1981, in B 102, vol. 270508, BArch.

⁹³ Memorandum by Hermann Heick, the Director of the Division of Economic Affairs in the Chancellor’s Office, “Wirtschaftssanktionen gegen die Sowjetunion,” 11 April 1980, in UdSSR, vol. 5, 1979–1980, Doc. 19, AHSH.

⁹⁴ See Stephan Kieninger, “Freer Movement in Return for Cash. Franz Josef Strauss, Alexander Schalck-Golodkowski and the Milliardenkredit for the GDR, 1983–1984,” in New Perspectives on the End of the Cold War: Unexpected Transformation? ed. Bernhard Blumenau, Jussi Hanhimäki, and Barbara Zanchetta (London: Routledge, 2018), 117–37.

Additional information

Notes on contributors

Stephan Kieninger

Stephan Kieninger is the author of two books on the history of detente and cooperative security policies. He received his PhD from Mannheim University. Formerly, he was a DAAD Post-Doctoral Fellow at the Foreign Policy Institute of Johns Hopkins SAIS, a Fellow at the Berlin Center for Cold War Studies and a Senior Research Associate at the Federal German Archives.