Partner with Cash

To many of its NATO partners, brawny young West Germany is a source of acute irritation. It has been slow to make its full contribution to Western defense. Its energetic industry is the despair of its European competitors. And like a poker game at 3 a.m., inter-European trade is getting out of hand because Germans are cornering all the money. But wait until the Germans have to burden themselves with rearming, as we do, said their competitors hopefully, and floods of Volkswagens will no longer swamp world markets.

Instead, West Germany's pfennig-pinching Finance Minister Fritz Schaffer came up last week with an audacious proposal: Germany would let the rest of the world make heavy arms; Germany would merely buy them, using its accumulated trade surpluses. With a glance at the Iron Curtain, Schaffer added piously: "We must never forget that we are a border country, and that it would be politically extremely imprudent to build up a war industry a few kilometers away from the frontier ... A wrong picture could be created beyond this frontier."

For the Germans, the decision made shrewd sense militarily, economically and politically. They argue that arms are needed now, and it would take years to build an adequate arms industry. Besides, an arms industry so close to the Iron Curtain could be knocked out by a few Russian bombs, or occupied in a matter of days. Big manufacturers who would have to make the tanks and heavy guns have all the peacetime business they can use, and firms like Krupp want no part of the risk and none of the stigma of becoming munitions makers again. Furthermore, weapons are in a transitional stage, and Germans do not want to commit themselves to large-scale production until the weapons of the future have taken clear shape.

With the budget for arms-buying set tentatively at $2.3 billion in the next three years, the Germans also expect to gain much political influence through the judicious placing of orders--and other countries are already scrambling for them. The British are trying hard to get the Germans to buy Centurion tanks instead of U.S. M-475. The Turks and Italians are competing for ammunition orders. But the biggest purchases will be in the U.S. Last week a mission headed by Dr. Fritz von Twardowski returned from a two-week shopping mission in the U.S. with tentative agreements to buy a whopping $1.4 billion worth of U.S. equipment in the next three years. The expectation is that Germany will spend $500 million in the next year for U.S. aircraft, tanks and artillery. It will pay $190 million in advance, the rest, cash on delivery.

Other planned spending: P:$429 million in Great Britain for airplanes and armored personnel carriers. P: $166 million in Turkey for ammunition. P: $166 million in Italy for ammunition and small aircraft.

P:$119 million in France, for personnel carriers, transports, and jet trainers. P: $46 million in Belgium for guns and ammunition.

Schaffer's plan has the full backing of Konrad Adenauer as a short-range measure, though for political reasons, Adenauer believes, West Germany owes it to her NATO partners to build its own arms industry in time. Explained one Adenauer intimate: "The British and our other competitors for export markets won't like the idea of our buying arms forever. They have to spend money and plant space for arms production while we utilize ours for export goods. It is hardly fair to enter a horse in a race and expect him to carry less weight than his rivals."

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