Embassy Row
George Szamuely
New York Press


The U.S. ambassador to Germany, John Kornblum, announced recently that he was sick of "these diatribes in the press about arrogant Americans." The Germans, he subsequently complained, "were beginning to behave like a superpower." What had the Germans done? Proposed to build their own nuclear weapons? Surely, they had not asked the GIs to go home at last? No, they had dared to protest United States plans for the new Berlin embassy. The U.S. government is demanding a 30-meter-wide cordon around the building to thwart the designs of mad bombers. It all goes back to the August 1998 destruction of the embassies in Tanzania and Kenya. A panel headed by former Joint Chiefs chairman Admiral William Crowe reported that something like 90 percent of America’s embassies needed to be renovated.

The trouble is, the United States insists on building the embassy on its prewar site on the Pariser Platz, which is near the Brandenburg Gate–the heart of Berlin. The Germans argue that a 30-meter cordon would disrupt the city’s traffic and complicate access to the Brandenburg Gate. As compromise, they suggested that the Americans could have their cordoned embassy in the city’s diplomatic quarter in the Tiergarten district. In addition, the Americans could maintain a representative office on the Pariser Platz. Nothing doing, blustered our dimwitted Secretary of State. The Germans then suggested that the Americans could have their embassy on the Pariser Platz but the cordon could not be more than 22 meters. This offer, too, was rejected out of hand. German ingratitude apparently knew no bounds. "All we did was defend this place for 40 years," spluttered an enraged Kornblum.

For the first time since 1945 the Germans did not grovel abjectly before Washington’s diktats. Klaus Bolling, a former spokesman for Chancellor Helmut Schmidt, wrote a newspaper article entitled "The Times Have Changed Mr. Ambassador." He likened Kornblum to Lord Mountbatten of India. The German magazine Der Spiegel published an article about Kornblum entitled "Imperial Nostalgia." Subsequently Kornblum berated Bolling when the two accidentally bumped into each other in a Berlin restaurant. "He was like a U.S. Army sergeant dressing down a GI," Bolling recounted later. But Kornblum was not done yet. At the recent opening of Berlin’s Transatlantic Center, he declared that a reunited Germany still needed time before it could "strike the right tone in the international arena."

The "right tone in the international arena" means following the United States’ orders. American insistence on blind obedience is more fervent today than it ever was in the Cold War. Not only are Germans expected to fall in enthusiastically with the latest loony bombing caper thought up by Washington; they are also expected to surrender the center of their capital to America’s whims. In addition–and this is a real innovation–they are expected to adopt the American model of capitalism. Scarcely a day goes by without a story appearing in the media about Germany’s apparent economic backwardness, its moribund economic system, its museum-like industries. "Germany Resists the New Economy" was the typical headline of a recent Washington Post analysis. That same day, The Wall Street Journal ran a front-page story with the heading: "Once the Big Muscle of German Industry, Unions See It All Sag." The subheading said it all: "Membership and Clout Slip As Country Rues the Cost of Labor Inflexibility." "Labor flexibility," of course, is a euphemism for "easy to fire."

Archived Columns by George Szamuely

Embassy Row

Selling Snake Oil

Chinese Puzzle

That Was No Lady, That Was the Times

The Red Tide Turning?

Pat & The Pod

United Fundamentalist States

Let Them All Have Nukes!

Liar, Liar

Gangster Nations

Puerto Rico Libre – and Good Riddance

Leave China Alone

A World Safe for Kleptocracy

Proud To Be

All articles reprinted with permission from the New York Press

This outpouring of anguish at Germany’s alleged terrible plight was provoked by Chancellor Schroder’s rescue of Philipp Holzmann, the nation’s second-largest construction firm. On top of that, the Chancellor indicated that he was opposed to the proposed $125 billion hostile takeover of Germany’s Mannesmann AG by Britain’s Vodafone Airtouch PLC. From the hysterical splutterings of our reporters and editorial writers you might have thought Lenin had just seized power in Berlin. Holzmann, a 150-year-old company that had built opera houses and train stations in the 19th century, had got into trouble with some bad debts and the creditors were about to pull the plug. The company filed for bankruptcy and tens of thousands of people were on the verge of being thrown out of work.

But the German public did not respond the way the American public would. It failed to be moved by the tragic plight of the poor, down-at-the-heel bankers. Instead, it demanded that the venerable company be saved. "Bank Disgrace!" ran the banner headline in the mass-circulation newspaper Bild. The paper also published photos of the 20 bank chiefs who had refused to bail out Holzmann, as well as their salaries. Bild, incidentally, is a conservative newspaper. Schroder came up with DM250 million of government money and persuaded the creditor banks to support a restructuring program as part of a DM4.3 billion bailout. Schroder saved Holzmann and for the first time ever he is wildly popular in Germany. "I wanted to be sure my buddies had something under the Christmas tree… I came here to get the banks to be responsible. To be responsible is not to let a company that I consider salvageable, break up," Schroder explained. Such talk would be unthinkable in the United States where the highest moral imperative is the unhindered operation of the free market. Workers are taught to sacrifice themselves for the sake of "competitiveness." In American eyes Schroder committed sacrilege. "Throwing in a generous dollop of taxpayer money to avert a big corporate collapse and save jobs," explained an incredulous AP reporter, "the chancellor has turned leftward to make amends with the many German voters who reject his modernizing course… Schroder came around to defending Germany’s well-worn, consensus-based corporate culture." Note the easy identification of "modernizing" with, in effect, Americanizing. A Reuters story summed up the issue excellently: "Analysts say German banks, locked in mounting competition with international banks, can no longer justify bailing out loss-making companies just for the sake of rescuing jobs." Of course not. Who cares about jobs? The only thing that matters is staying competitive and that means continuously boosting the value of the banks’ shares.

Thanks to Schroder, the Germans have now made clear they are not about to adopt the Blairite or American model of capitalism. They have no intention of allowing their companies to be taken over, stripped of their assets and their workers fired–all in the name of cutting costs, improving balance sheets and therefore increasing shareholder value. The Germans are not about to fall on their knees before the holy altar of "labor flexibility." Here in the United States our media–now more and more simply the spokesmen for the corporations that own them–invariably applaud the daily corporate mergers and acquisitions. Time and Warner, Viacom and CBS, now Washington Post and NBC–the hacks fairly drool as they detail how many billions of dollars these new conglomerates are now worth. That people are thrown out of work is of little consequence. That resulting new entities are scarcely innovative, interesting or productive is of even less consequence. No, the only thing that matters is shareholder value. This is what the so-called "modernization" of the economy means. This is what the moribund, lackluster Germans seem unable to embrace.

Interestingly enough, despite predictions of its imminent demise, the German economy is actually astonishingly robust. A reader of the American press would be surprised to learn that in 1998, the hidebound, sclerotic Germans improved their manufacturing productivity by 4.3 percent–the best performance of any OECD country. Americans workers would be surprised to learn–unpleasantly so unfortunately–just how much better off their German counterparts are. In 1997 hourly direct pay for manufacturing workers in the United States was $14.34 an hour. In Germany it was $20.94 an hour. To be sure, the Germans have high unemployment. But what is better? To wash dishes here at $2 an hour? Or to be unemployed in Germany and to enjoy generous welfare benefits, first-rate health care and a largely free education system–one that is vastly superior to anything in the United States? Remember, too, that during the past decade the Germans have had to bear the staggering costs of absorbing the former East Germany.

"America uber alles" was always a nonstarter. Forever basking in the Cold War victory, Americans fail to see how much has changed in the last 10 years, as Ambassador Kornblum’s disastrous performance demonstrates. For all the bluster of the Washington elite, America’s economic performance is simply too insipid to support an imperial foreign policy.

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