"Don't Predict Disaster"

Even if his counterparts elsewhere in Western Europe were not struggling with deep political and economic problems, West Germany's Chancellor Helmut Schmidt would stand out. As his country's head of government and top economic policymaker (he is a former Finance Minister), Schmidt, 57, has led the country out of its worst postwar recession relatively unscathed. Often Schmidt's opinions are the determining factor in Common Market decisions. At home, he does not elicit overwhelming warmth or emotion, but he is sufficiently respected to have won a 76% "approval" rating in a recent public opinion poll.

At the end of a day's work last week, Chancellor Schmidt received TIME Managing Editor Henry Grunwald and Bonn Bureau Chief Bruce Nelan for an evening interview at his Bonn office in the old but elegant Palais Schaumburg on the Rhine. He alternately sniffed snuff and puffed menthol cigarettes as he talked about the political and economic prospects of Western Europe. Excerpts:

ON COMMUNISM IN EUROPE. I wouldn't like to see the Communist Party in the government in Paris, or in Rome, or in other places. On the other hand, I do not believe that this must of necessity mean a catastrophe. We have seen Communists as ministers, and even in higher office, in Lisbon, and we have seen them in Reykjavik. Europe has not collapsed, nor has the Atlantic Alliance. I would not like us to predict disaster if it's possible that such predictions might in the end prove to be self-fulfilling prophecies.

DEALING WITH THE THREAT. The best thing the [European Economic] Community can do is lead its member states toward satisfactory and successful financial, economic and social security measures. Germany has already undertaken rather great financial sacrifices for the benefit of Europe as a whole, and we are also willing to do this in the future. By any yardstick, Germany's economic performance has been rather good. We have also maintained great confidence in the stability of the social structure. I would like to point out that, unlike other European countries, the Communist groups or parties can expect no gain from our national elections. You will need a microscope to see where the Communists are on election night. And you won't see any gain by extremists on the right edge of the political spectrum either.

CAN COMMUNISTS BE DEMOCRATS?

This depends on the person or party you have in mind. There are many types of Communism coexisting in the world nowadays. I wouldn't be rigid in my evaluation. It is true that in those countries where Communist parties have behaved in a democratic way, they have been rather small minority parties.

ON CONGRESSIONAL LIMITATIONS ON U.S. FOREIGN POLICY. I think I have a good understanding for the historic and psychological reasons that have driven Congress to act as it has. In the medium and long run, I hope that the American Administration will regain a greater amount of independence in international operations from the trends inside Congress.

ON GERMAN CHARACTER. There is a certain weakness in our national character tending toward perfectionism. We even make our mistakes in a perfect manner--big mistakes, even crimes. This perfectionist weakness is not something that will evaporate this year or this decade. It's one of those characteristics that have a long period of life in the development of a nation. People also attribute to Germans a certain amount of discipline. This, I hope, will not quickly vanish.

BONN'S ROLE IN EUROPE. We have taken quite a number of initiatives. On the other hand, to be quite honest, we have been very careful not to congratulate ourselves too obviously on such initiatives. It will have to be this way for quite a while yet. I'm quite aware that the memory of the second World War has not died out. To some degree, there is a danger of reviving this memory in thinking of too great differences in the economic and social performance of this country as compared with others in Europe. From time to time I warn my countrymen that we would under no circumstances advise any German to seek German leadership in Europe or even within the EEC. We don't dream of it, and I warn everyone not to dream of it.

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