1989- The Struggle to Create Post-Cold War Europe Page 23

  Worry about this possibility caused Bonn to open the money spigot. By the beginning of May 1990, the West German government had decided that it would merge the two currencies at an exchange rate of two to one Eastern to Western marks for many purposes, but individuals would enjoy a one-to-one rate for some of their savings, and importantly, their salaries and pensions.10 This rate was much higher than the actual exchange on the streets, and leading bankers and economists, including the president of the Bundesbank, warned that it could destroy East German firms that would have to trade on the basis of it. But while economically questionable, this exchange rate was politically useful because it would serve to blunt complaints. Kohl suspected that financial generosity would help matters with the Soviet Union as well, and this view would soon receive abundant confirmation.

  For the time being, Gorbachev was sticking to his opposition to NATO membership for a united Germany. The country could unify, as he had agreed in February 1990, but it had to find a new solution to its security needs, and the Soviet leader continued to advocate vague but sweeping plans for some kind of pan-European alliance as the solution. Gorbachev had a vision for a European Germany, but by that he meant something quite different than Kohl, who saw it as linked to the EC and NATO.

  A number of remarks made in spring 1990 showed that Gorbachev still hoped that Germany could become the core, rather than the Eastern fringe, of European economic and military institutions. First, he discussed his vision with Hurd, the UK foreign secretary, in mid-April 1990. In a wide-ranging conversation of an hour and a half, Gorbachev told the British foreign minister that he still wanted a new European security structure, stretching from the Atlantic to the Urals. Although Gorbachev remarked at the end of the conversation on how frank it had been (according to Hurd, Gorbachev said that it had been a “long time since he had spoken so freely to a Western visitor”), it seems that he left unspoken the fact that such a structure would exclude the Americans.11 The Soviet leader then subsequently speculated with the Polish president, Jaruzelski, on April 13 as to whether the Warsaw Pact should increase its presence in East Germany until such a pan-European structure came about. Jaruzelski agreed, and thought that because there were not only U.S. but also British and French troops in West Germany, it would make sense for Polish and Czechoslovakian troops to be based in East Germany as well. Gorbachev was pleased to hear this, saying that he found this idea to be a serious and important suggestion.12 As the State Department analyst Sicherman had suspected, Stalin’s ghost was indeed being treated to the spectacle of Polish leaders seeing the value of Soviet troops. Finally, the U.S. ambassador in Moscow, Matlock, reported home on May 1 that Gorbachev was contemplating a quick fix: create a pan-European security pact instantaneously by putting a united Germany into both NATO and the Warsaw Pact simultaneously. Matlock summarized Gorbachev’s logic as follows: if “Germany can participate without difficulty in the G-7, the EC-12, the NATO-16 and the CSCE-35, why couldn’t it also accept participation in all or part of the Warsaw Pact political framework—an Eastern E-7, so to speak?” 13

  Nevertheless, with his own position continuing to weaken and Kohl’s confirmed by the March 18 election, Gorbachev was facing an uphill battle, both at home and abroad. The crisis caused by the Lithuanian desire for independence from the Soviet Union was sapping energy and support; Moscow decided to cut supplies of fuel and other goods to the region in an effort to force an end to the crisis.14 Matlock found that Gorbachev was starting to look “less like a man in control and more [like] an embattled leader.” Moreover, the “signs of crisis are legion: Sharply rising crime rates, proliferating anti-regime demonstrations, burgeoning separatist movements, deteriorating economic performance … and a slow, uncertain transfer of power from party to state and from the center to the periphery.” 15 Thatcher, who spoke to Gorbachev on the phone around this time, remarked to Powell that the Soviet leader sounded like a man who had just lost his father.16

  Matlock also noted that Gorbachev was having increasing difficulties with factions within his own party. The more likely a speedy German reunification became (and it became a lot more likely after the March 18 election result), the more upset Soviet military leaders and old-style foreign policy experts such as Falin became. One U.S. policymaker heard from his contacts in the Red Army around this time that senior military leaders were wishing they had shot Gorbachev on the tarmac when he flew back from his December 1988 visit to the United States. During that visit, he had announced unilateral force reductions in a speech to the United Nations without consulting his military leaders.17

  Now, in spring 1990, far more than just troop reductions were under way. On April 17, a draft of the treaty that would eventually produce economic and monetary union was leaked to, and published in, a West German newspaper.18 This leak caused fresh consternation in Moscow among Gorbachev’s opponents, because the draft seemed devoid of awareness about the potential impact on the USSR. A Soviet diplomatic protest to Bonn resulted. Moscow complained that the needs of GDR-USSR trade were not sufficiently considered in the draft. Given that something on the order of 35 percent of the East German workforce (about five hundred thousand people) was engaged in enterprises that exported to the Soviet Union, and that such exports represented 40 percent of the GDR’s total, it was not a small issue. What would be the exchange rate between an East Germany that would have a convertible currency and a Soviet Union that did not? How would the two countries introduce real prices for commodities, particularly oil and gas, into the existing trade agreements between East Germany and the Soviet Union?19 And finally and perhaps most importantly, how could Gorbachev prevent what Kohl believed would happen—namely, the rise of resentment among Soviet troops in East Germany as their salaries became worth less (or even worthless) locally?20

  Falin wrote to Gorbachev on April 18—the day that Schäuble began working with his East Berlin counterparts to produce the internal legal documents for political unity—to complain that German reunification had become a fiasco. The Soviet Union had “spoiled Washington” by conceding too much; “now we need to be strong.” It was becoming apparent that the 2 + 4 forum was, in Falin’s view, simply a venue for the United States and West Germany to present the USSR with decisions they had already made. As a result, Russia would have to find other ways to assert itself. Politically, Moscow should emphasize the “rights and responsibilities that it took on at Yalta and Potsdam.” Militarily, a united Germany should be allowed in NATO at most only as a transitional step on the way to something more to the liking of the Soviet Union. Finally, in economic terms, Falin thought that Gorbachev should press Kohl for specifics on how he would help the USSR. The chancellor’s habit of avoiding clear promises, saying only that “all will be well,” was not enough. In his complaints, Falin had support from military leaders, who for their part would soon begin finding ways to classify the short-range SS-23 missiles in Eastern Europe in such a way that they did not fall under the already-signed INF treaty. Military analysts would also try to find loopholes in the conventional forces treaty currently under negotiation in Vienna.21

  Falin seems to have taken matters into his own hands when he did not get a satisfactory reply from Gorbachev. The Soviet ambassador in East Berlin, Kochemasov, reportedly acting on instructions from Falin, ordered de Maizière to come to see him.22 This demand represented protocol turned upside down. An ambassador should attend on a head of government and not the other way around. The ingrained habits of obedience to the Soviet Union were so strong, however, that de Maizière still came when called. Teltschik, who was advising de Maizière and his government in secret to avoid the impression that Bonn was remotely controlling them, told the East German that he should not have accepted; but the damage was done.23 The irony was heavy, of course; the West German was advising de Maizière not to jump when the Soviets demanded it, but Bonn certainly expected East Berlin to follow its lead. Kohl and Teltschik were just more careful about keeping the process private.

  Wh
en de Maizière showed up for the meeting, Kochemasov informed him that Moscow was deeply worried about the rush to unify Germany under Article 23. The Soviet Union expected East Germany to maintain all of its trade agreements with the USSR after monetary union, regardless of how or when unity happened.24 To this end, there should be talks between the GDR and Moscow to clarify how such treaties would be respected. The implicit “or else” was a blockage of the 2 + 4 talks. As a result, USSR-GDR meetings commenced at the end of April 1990. The fact that Kochemasov, and by extension Falin, ordered this of de Maizière and not of Kohl shows their hopes of bullying the politically inexperienced East German leader.25

  Moscow could not bypass Bonn entirely, though, since ultimately it would be the heir to East Germany’s trade relationships. Kohl summoned the Soviet ambassador in Bonn, Yuli Kvizinski, to his office on April 23, in the midst of his preparations for the EC meeting in Dublin. The chancellor complained about what Moscow had done. He assured Kvizinski that he would take the Soviet Union’s needs into account as the German economies merged. In return, the Soviet ambassador made his leverage clear; unless Bonn was forthcoming, Soviet troops would insist on staying in Germany as long as NATO troops were there.26 Kohl decided that the issue required top-level attention. He immediately sent a letter directly to Gorbachev, suggesting that a united Germany would be willing to sign a new treaty of economic cooperation with Moscow to make sure that its interests were addressed.27

  This contretemps had its uses: it confirmed Kohl’s belief, already voiced at Camp David in February, that the bottom line with Moscow would be a question of money. In other words, Kohl felt certain that the Soviets were more worried about securing lucrative future economic relations with united Germany than they were about preventing its NATO membership (although they were obviously not happy about the latter).28 If he could reassure both Gorbachev and his foes that West Germany would be a reliable source of support, then he would empower Gorbachev to give permission for a united Germany to enter NATO.

  Indeed, Kohl even ran interference on Gorbachev’s behalf in the Baltic crisis. In a meeting on May 11, he bluntly told the prime minister of Lithuania, Kazimiera Prunskiene, to backtrack from her demands on independence because she was endangering Gorbachev’s position. Kohl explained to her in no uncertain terms that all significant Western leaders were on the side of Gorbachev. As the chancellor put it, “with him, we know where we stand; what comes afterward, we have no idea.” He explicitly assured her that Bush, Mitterrand, Thatcher, and indeed all reasonable leaders in the West felt the same way.29 Left unspoken was Kohl’s interest in the matter—namely, keeping Gorbachev in office until he got Germany unified. The irony, of course, was that he was telling Prunskiene to suppress her national goals in order to achieve his own.

  Kohl was right in his intuition about Moscow’s priorities. Around this time, Chernyaev confidentially advised Gorbachev that it was probably no longer possible to prevent full German membership in the Western military alliance. Chernyaev thought that to a certain extent it did not even matter. The balance of forces that counted was the nuclear one, and that would not change even if a united Germany joined NATO, since it had no homegrown nuclear weapons.30 The real problem—which Shevardnadze also would emphasize in the 2 + 4 talks—was not the balance of power but rather the balance of opinion. Getting Gorbachev’s domestic enemies, and in fact the broad mass of people in the Soviet Union, to accept Germany in NATO would be an enormous political challenge. Once again, domestic politics cast a long shadow over international relations. Shevardnadze tried to stall in the 2 + 4 talks, suggesting that the internal and external processes of unification should happen at different times.31 Seeing Shevardnadze do this, Baker advised President Bush that “the Soviets don’t know how to square the circle” of getting over their psychological difficulty with a united Germany.32

  As part of an effort to prevent such stalling, a series of bilateral FRG-USSR meetings began, parallel to the GDR-USSR talks that Falin had produced with his bullying. In the course of all these bilaterals, Moscow’s expectations became increasingly clear—and pricey. Kohl was right to think that he could buy Soviet approval (even though he would not publicly use that phrase), but the price was going to be high.33 Kohl, as mentioned above, had recently been telling anyone who would listen that the Russian troops in East Germany would want to leave because their relative economic status would decline once the locals were holding hard Western DM. At the beginning of May, however, he finally heard from Teltschik about the Soviet troop savings in a “field bank.” By Teltschik’s estimate, the savings were an enormous sum, on the order of several hundreds of millions of East German marks. The soldiers of the Red Army felt that they should be able to exchange their now-meaningless savings into DM at the same rate as the locals.34 Since this issue involved hundreds of thousands of armed soldiers, their desires could not be neglected.

  On top of this, Moscow was seeking twenty to twenty-five billion DM in credit.35 Shevardnadze let Teltschik know that the Soviet Union was ceasing to be able to secure loans on its own on the international credit market—a problem that Teltschik confirmed with Hilmar Kopper of Deutsche Bank and Wolfgang Röller of Dresdner Bank.36 Kohl was convinced, however, that there remained a case for lending to Moscow. Whatever came after Gorbachev would, Kohl thought, be worse, so it would be in the self-interest of the West to keep him afloat as long as possible. Kohl was able to convince Kopper and Röller of this belief. On short notice and in secret, they flew with Teltschik to Moscow on May 13. The pilots of their Challenger aircraft did not even receive the names of the passengers whom they had on board, although they recognized Teltschik’s face.37

  Teltschik’s mission had to be kept quiet from the West German Foreign Ministry, because by speaking directly with Gorbachev, Teltschik was almost acting like a foreign minister himself. In an interview in 2008, he remembered that his main task on this secret trip was indeed momentous: to make it clear that he would secure credit for Gorbachev in exchange for agreement with full German NATO membership, but Teltschik was not supposed to put it that bluntly.38 Instead, there was a lot of beating around the bush.

  Presumably in an effort to save face, Gorbachev grandly announced to Teltschik that the Soviet Union would not be dependent on any other country. Rather, it was seeking an investment in its future, which it would repay once it had gotten over some rough spots. “We need oxygen in order to survive two or three years,” he explained. Unfortunately, direct hints to the United States that this kind of help would be appreciated had fallen and would continue to fall on deaf ears. Teltschik voiced sympathy and understanding; he hoped that his short-notice visit convinced Gorbachev that Bonn was serious about helping. Although Teltschik did not then add “and in return we want to join NATO as a united country,” he did express Kohl’s strong desire to meet again personally with the Soviet leader, where NATO would presumably be the main topic. Gorbachev agreed to a July 1990 summit between himself and Kohl. Yet he then went on to repeat his desire for a dissolution of both military alliances. Clearly, Gorbachev was either missing or ignoring the implicit quid pro quo.39

  Teltschik flew back to Bonn just in time to help finalize several key plans for unification. He scrutinized the final version of the treaty that would create economic and monetary union, which was completed on May 18.40 Kohl had also decided that the next West German election (which, as previously mentioned, under its electoral law did not have a fixed date but had to happen before January 13, 1991) should in fact take place at the start of December 1990. This would allow Kohl to get the West German election over, just, before the opening of the Italian conference that would begin the risky process of replacing the DM with a European common currency, as agreed in Dublin.

  But there were complications. The chancellor also hoped to turn this West German election into the first all-German election since the 1930s, now that he knew that the CDU had such strong support in the East. He wanted the GDR’s population to become par
t of the electorate in time for the voting, but that meant unity even before December 1990, a tall order. Easterners were strong advocates of Kohl’s push for rapid unity, but West Germans were developing mixed opinions. A major poll in the FRG in April and May 1990 showed that the number of West Germans seeing unification as a “cause for joy” and a “cause for concern” were roughly equal. Worryingly, a majority of West Germans felt that the FRG was already doing too much to help East Germans who moved to the West.41

  If the election really was going to be an all-German one, Kohl needed Soviet acquiescence to the various open issues soon. He decided to use his leverage to get his friends in banking to loan Gorbachev money in the hopes of speeding events up.42 His leverage was clearly strong, because the end result of its application was that Kopper and Röller informed Moscow it could borrow up to five billion DM, with the West German government as its backer.43 Gorbachev reacted “euphorically,” Teltschik remembers, on hearing this news.44 He would later call this credit a “chess move” made at the right moment; it meant a great deal to him.45 The July summit between Kohl and Gorbachev, arranged by Teltschik on his secret mission in May, was shaping up to be a promising one.

  THE WASHINGTON SUMMIT

  Kohl now had proffered the first carrot. Preparing the second, the reform of NATO, became even more urgent. Bush and Kohl agreed that making NATO more palatable to the Soviets would ultimately enable Gorbachev to accept unified Germany as part of it. To this end, Bush called for a NATO summit in summer 1990 as a means of publicizing NATO’s willingness to present a different face to the Soviet Union in the future.46 Kohl agreed that such a summit would be useful, but also risky; he told Baker that it should not take place until after Gorbachev survived the upcoming Communist Party Congress of July 2–14. The Soviet leader had recently restructured governance in Moscow and become “president,” a state title that he now used instead of his party one of “general secretary,” so he would clearly have to defend this downgrading of the party at the July congress. Separatist uprisings and Red Army alarm at the concessions being contemplated in the CFE talks would be tricky items as well. In short, the Soviet leader would face opposition from many quarters, and Kohl did not want to add the uncertainty of a simultaneous NATO summit. Baker disagreed; responding to strong hints from Shevardnadze, the secretary thought that revamping NATO’s goals and public relations would help Gorbachev defend himself at the congress. Washington prevailed. The summit would be scheduled for July 5–6.47