Power Grabber

The West's newest ally, West Germany, was making a most disagreeable impression on its friends last week. Chiefly responsible was crabbed, pfennig-pinching Finance Minister Fritz Schaeffer. Schaeffer was flatly unwilling to pay what Germany's NATO partners consider a fair share of Western defense.

NATO's troubles with Herr Schaeffer began in December, when Schaeffer told the NATO council that the most prosperous country in Europe could not afford any more than 9 billion Deutsche Marks ($2 billion) a year for defense during the three-year period required to build a twelve-division army. The NATO allies pointed out indignantly that this was only 5.5% of West Germany's gross national product, proportionally only half what the U.S. and Britain are contributing. Grumbling, they finally accepted Schaeffer's figure for 1956 because the German army is so far behind schedule that more money could not be spent anyway.

Last week Schaeffer added insult to injury. Through a spokesman he announced that after May 5, West Germany would refuse to pay any further cash contributions toward the support of the allied forces in Germany, which in the absence of a German army, are his nation's sole defense. The Germans would talk about the question with their allies, said the spokesman, "but we are not going to give them anything."

The U.S. State Department was frankly irritated. So were the British, who declared that they simply did not have $196 million in hard currency to support their four divisions in Germany if Schaeffer cut off payments.

The Quarreler. But 67-year-old Fritz Schaeffer is used to irritating allies. A prewar lawyer and leading politician in Bavaria, he was picked by General George Patton as the first postwar Minister-President of Bavaria. Soon Schaeffer was quarreling with the U.S. occupation authorities because he insisted on hiring ex-Nazis to staff his office. He needed men of ability, he argued, and the question of their Naziism was irrelevant. Patton agreed, but General Eisenhower did not. Schaeffer went on hiring Nazis anyway, was discovered, and in the ensuing uproar,* Eisenhower ordered Schaeffer fired. Schaeffer got back in government three years later when fellow Christian Democrats, needing his help in Bavaria, asked for his reinstatement.

As Finance Minister since 1949, Schaeffer's policy of hard money and high incentives were largely responsible for German recovery. Some U.S. officials grinned when he bought cigarettes one at a time as an example of thrift, decreed the amount to be spent on wreaths for colleagues' funerals, or turned up at the wedding of Chancellor Adenauer's daughter with a bouquet of exactly six carnations costing 14-c- apiece. Wish there were more like him in other countries, they said. But others, negotiating with him on occupation matters, acquired a distrust for his evasive tactics and figure juggling. His power grew. When Adenauer fell ill 'last fall, he was even mentioned as a likely successor.

Increasingly, Schaeffer has shouldered his way into the center of policymaking. When Adenauer returned from Paris with German sovereignty and membership in NATO, he had planned to handle all defense financing himself. But in a Cabinet battle, Schaeffer demanded and got a veto on every penny that was to be spent on Germany's defense establishment. He bound his party firmly to his promise that, with a yearly defense budget of no more than 9 billion Deutsche Marks, West Germans could have their army at no cost in butter.

For months he beat into German minds the thesis that one pfennig more would wreck their thriving economy, raise taxes, cut social programs, until millions of Germans believed it as an article of faith.

Then he sprang his trap. The army would cost a bit more than that, he admitted--about $2 billion more (just as his Socialist critics all along said it would). His proposed solution: U.S. grants and long-term loans. Or in the words blurted in heat of debate last fall by his fellow moneyman Economics Minister Ludwig Erhard: "Let the Americans pay for it."

Schaeffer's reasoning: the U.S. would not dare let him down, for fear the Socialists would win next year's elections.

Defense on the Cheap. At a Cabinet meeting last week, Foreign Minister Heinrich von Brentano worriedly brought up the allied annoyance and suggested further Cabinet discussion of Schaeffer's tactics. Schaeffer appeared to agree--but only until Von Brentano left the meeting early to receive Italy's visiting Prime Minister Antonio Segni. Then Schaeffer suddenly offered to grant funds for several domestic schemes close to the heart of C.D.U. politicians. Schaeffer named his price: Cabinet support of his running out on the allies. Docilely, the Cabinet yielded.

In earlier days the West could have counted on firmer support from Konrad Adenauer. But since his illness, Adenauer seems and acts increasingly like a tired old man. He is preoccupied often with next year's elections, seems to feel that his Christian Democrats need such political ammunition as Schaeffer's defense-on-the-cheap can give them.

In Germany last week Schaeffer was hailed as a heroic defender of Germany's purse. Newspapers of all political shades backed his stand, talked of "allied covetousness." The allied attitude was simpler: Germany had joined NATO and should be willing to pay the dues.

* During which Patton made his famous remark that "the Nazi thing is just like a Democratic-Republican election fight." Eisenhower transferred him to command of the paper Fifteenth Army. A few weeks later Patton died after an automobile accident.

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