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PASTOR GENERAL'S REPORT, December 12, 1980
Page 18
The FDP, and the conservative opposition as well, is well aware of the fact
that West German productivity is suffering. Wage settlements have been
consistently running ahead of the expansion of the economy in recent years.
And now it appears the economy won't grow at all in 1981. Over the years
of social democracy, West German labor costs (wages plus social benefits
employers must pay) have grown considerably more expensive than those in
the United States. (Officials at the Volkswagan plant in New Stanton,
Pennsylvania insist that their people actually work 42 days a year more
than their counterpart in Wolfsburg.)
Reflecting their growing pessimism, West German industrialists are invest
ing increasing amounts overseas. And nearly half of the investment at
home is plowed into new processing devices and labor-saving technique,,
in an attempt to get around high labor costs.
Nearly every,;vhere Chancellor Sch:nid � :uvks,
i:1e
sees c; 1-oomy sigr ':". S i:--ice
the start of the year the deutsche mark has dropped over 20% in value
against the British pound and about 10% against the U.S. �ollar (It is now
back to 2 marks to the dollar as opposed to as low as 1.75 to 1 at Feast
time). While a good portion of this is attributable to high interest
rates in the U.S. and Britain, a large part is also tied into Bonn's
declining foreign trade picture. Counting "invisibles" such as tourism
and capital transfers abroad, the Federal Republic's shortfall for 1980
could reach a whopping $16 billion.
"Kicked in the Teeth" by East Germany
On the foreign policy front, Chancellor Schmidt is also taking his lumps.
The East German regime dealt him a reeling blow right after his re-elec
tion by doubling overnight the amount of money West Germans must spend
per day while visiting friends and neighbors in the East. For West
Berliners the rate was quadrupled.
Clearly the East German regime is intent on limiting Western contacts in
this time of trouble in neighboring Poland. But the manner in which Party
Chief Honecker did it showed how little he thought of Schmidt and the SPD
leadership, which had labored so many years to foster Ostpolitik, its form
of intra-German detente. East Berlin cynically waited for Schmidt to win
the election before openly announcing its new policy--a move which would
have gained anti-communist challenger Franz-Josef Strauss votes if done
before October 5. Little wonder a bitter Schmidt told aides: "We were
kicked in the teeth."
Then too, Schmidt made a curious move in his relationship with Washington.
He paid an official visit to the White House right on the heels of the
American election--for a meeting with loser Jimmy Carter. Even though he
also saw President-elect Reagan, why, Schmidt's critics asked, didn't he
postpone his trip until after Reagan was in office? Was a potential "lame
duck" just visiting another lame duck?
"Chancellor in a Low"
Faced with all these sudden downturns, Chancellor Schmidt has sunk into a
depressed state of mind. The Spiegel story carried a cover close-up pic
ture of a very blue-mooded Schmidt, with the title "Kanzler in Tief"-
Chancellor in a Low. What a contrast to the jubilant picture of the
Chancellor on the December PLAIN TRUTH!