European Diary, 1977-1981 (36 page)

Schmidt eventually arrived at 1.20, followed by Giscard at least seven minutes after this. Gaston Thorn had typically and correctly pointed out that there was no question of Giscard arriving before Schmidt and that probably his car was tucked into a side road on the way in from the airport waiting to see Schmidt go past. If so he might at least have come along a minute or two behind him. However, they all seemed tolerably tempered during lunch at which I sat between van Agt and Genscher and had a better conversation with Genscher than ever previously.

We then went to the Christiansborg for the opening session of the Council, which occupied itself with rather minor items of business for an hour. Then the heads of government and I drove out to Marienborg, a nice castle about twenty miles from the centre of Copenhagen (plenty of castles in Denmark). We were supposed to start there at 6 o'clock and I arrived about five minutes early on a most beautiful evening. However, we did not start until 6.30 not, as Thorn again suggested, because Callaghan would this time be at least half an hour late in order to get his own back (in fact he was there on time, as on this occasion were Giscard and Schmidt), but because van Agt was extremely late. We eventually had to start without him, and when he was then asked at dinner if he had got lost or if he had mistaken the time, he blandly said no, he had been having a press conference and the Dutch press were the most
exigeant
in the world. Rather a good cool performance, I thought.

When we started there was no one in the room except for the ten of us and a
chuchotage
interpreter for Andreotti. Later a Danish official came in, I think because Jørgensen was not fully understanding all the rather complicated exchanges in English and was getting understandably worried about losing the drift of the matter for the record which he would subsequently have to provide.

Jørgensen opened very briefly and then I spoke for about fifteen minutes. Callaghan and then Giscard spoke for about the same. And then Schmidt went off into one of his long soliloquies, which with a certain amount of interruption took forty minutes. It was mainly about the problems of the German economy in an improvident world, but it contained one or two splendid side-swipes, such as complaining at one stage that he could not understand English English. Mine was the worst, Callaghan's almost equally bad, Lynch's an improvement, but only Giscard's impeccably pellucid. After this, Jack Lynch alone was able to get in about a seven-minute speech before we adjourned for dinner just after 8.00.

It had been a good-tempered, analytical, slightly gloomy discussion. Giscard was the most constructive in opening up some lines for the future. He did a rather good analysis of the six groups in the world, the three parts of the developing world and the three main groups in the industrialized world, ending up by saying that of the three industrialized groups we in the Community had recently done by far the worst for growth and general economic performance, and that he could not dissociate this deterioration in our performance from the new era of world currency instability, with us the only one of the three developed groups which had such instability not merely between us and the other groups, but internal to our Community itself. It was a helpful analysis.

However, in this part of the discussion we did not get very near (except for some trailing remarks on my part) to discussing any hard scheme for advance towards a possible exchange-rate bloc. Schmidt at this stage intended to hold his hand until the tripartite breakfast he was having with Giscard and Callaghan the following morning. As recently as ten minutes before the start of the session he had told me that these were his tactics and that while he did not mind how much I opened the subject up, I should not expect him to say much in even such a restricted session as the one which we were having.

Dinner was rather pointless. Callaghan and Lynch were not there until the end as they were having a bilateral discussion about Northern Ireland outside. Nobody seemed to have much to say to their neighbours or anybody else until Giscard tried to start some general conversation, which began on this occasion not with a reference to Sir Charles Dilkie (sic), but by his suddenly asking me if I had ever read ‘un livre par une Américaine, Mademoiselle Tugwell, ou un quelconque nom, qui s'appelle, je crois,
Les Canons d'Août?'
So I said, ‘Yes, I have indeed read
The Guns of August
⁵⁴
by Barbara Tuchman,' and this led on to a long semi-general discussion about World War I and II commanders, the different effects of the wars upon differing countries and a variety of related subjects, ending up with a discussion of why, in England, there were now no generals or commanders whose names were known to the public, which Giscard slightly implausibly claimed was not the case in France.

We reassembled upstairs at 9.45 and went on until 11.30. Schmidt, whether through boredom or for some other reason, had completely changed his mind, his plan, or his tactics. He opened the discussion, and after only a very few preliminary words proceeded to spill the whole beans. He deployed his plans for dissolving the Snake in the new arrangement, using the European unit of account far more extensively, both for transactions between the member governments, for joint interventions against the dollar and third currencies, and possibly indeed for providing a full parallel currency, which could deal in stocks of raw materials and in which OPEC money might be encouraged to invest.

It took me a little time to realize that he was in fact giving a full
exposé
and therefore my own notes were not as coherent as they might have been. Broadly speaking, what he said was a firm repetition of what he had said to me in Bonn five weeks previously, except that at Copenhagen he did not offer to commit
all
reserves, only suggesting a significant proportion of the dollar reserves of all the participating countries, although, he implied, an almost limitless quantity of their indigenous currencies. What had however moved on very significantly since the end of February was the state of the play with Giscard. It was obvious that Schmidt's visit to Rambouillet the week before had completely lined up Giscard.
Giscard in some ways went further than Schmidt, and provided a more coherent, intellectual framework to the argument than Helmut himself did on this occasion.

In the two-hour session there were no participants except for Schmidt, Giscard, Callaghan and me. The others all remained absolutely silent, including Tindemans, who probably rightly did not produce his plan, for what Schmidt had proposed went rather further than what he had in mind. Lynch, Thorn, van Agt did not speak either. Andreotti intervened only at the end to make an irrelevant point about Mediterranean agriculture. Jørgensen summed up in a not very convincing manner. Callaghan was taken aback, I think, because although he had been given a fair rehearsal of what Schmidt had in mind on his own visit to Bonn about two and a half weeks previously, I do not believe that he had then taken things in at all completely (for the reasons which I gave earlier).

Nevertheless Callaghan handled himself well, expressed interest, was polite, non-committal, but didn't turn things down out of hand, or make any foolish statements. He concentrated on his fear that what was proposed might appear as anti-dollar and might therefore be divisive from an Atlantic point of view. Although I believe that at the fundamental level this is the reverse of the truth, the fact that he should take this point could at least be understood, because Schmidt had spoken in strongly anti-Carter terms, saying that the whole management of the dollar by the American administration was absolutely intolerable. At one point indeed he said that no American President could lead the Alliance while presiding over such degradation of the dollar as he had witnessed during his period as Federal Chancellor.

When we were breaking up Callaghan said that he was not sure that he had taken in everything completely and could I therefore go round to his hotel that night and go through it with him, to which I naturally acceded, though admitting that I was not sure that I had got every Schmidt detail myself. Accordingly, late though it was, Crispin and I saw him in a room in which John Hunt with a very bad cold, two Private Secretaries (Stowe and Cartledge) and Ken Couzens,
⁵⁵
the Finance Second Permanent Secretary, as his
Treasury title now is, were present. I summarized what Schmidt had said for about ten minutes. Callaghan then went through his own notes which tallied almost exactly.

He next asked other people what they thought. I said I had probably better leave for that discussion. He said, ‘No, no, do stay.' But nobody had much to say, certainly not Hunt. Couzens looked rather pole-axed and kept on repeating, ‘But it is very bold. Prime Minister. Did the Chancellor really go as far as that? It is very bold. It leaves the dollar on one side. I don't know what the Americans will say about it. It's very bold. Prime Minister.' After about twenty-five minutes of this, we went back to the Royal Hotel where I talked to Crispin before going to bed, in a state of some excitement, for it had been a remarkable day, at 2 o'clock.

SATURDAY, 8 APRIL.
Copenhagen and Brussels.

Ortoli came to see me at 8.45, and I gave him an account of what had taken place. It had been agreed in the meeting that very little, if anything, would be said outside, and it was suggested indeed that in the follow-up arrangements each of the heads of government should consult only one collaborator, though this was a prescript which had hardly been followed by Callaghan, who had immediately debriefed five, and I do not suppose was followed by any others either.

The full European Council reassembled in the Christiansborg at 10.10 and went on until 12.40. Not a great deal of useful business was transacted. Jørgensen was an uncertain chairman. An interesting
vignette
was that towards the end of the morning, when Giscard was holding forth about French dissatisfaction with the degree of progress which we had been able to make with the Japanese, and was addressing some courteous but slightly critical remarks about the Commission (rather for the record, I thought) specifically to me, Schmidt came round the table and said, ‘Could you quickly come and have a word with me?' I paused, being hesitant as to what to do, but then decided that a talk with Schmidt about monetary advance was more important than listening to Giscard on Japan, and therefore got up and talked with Schmidt in a window with both our backs to the Council and indeed to the continuing Giscard. Giscard allowed this to go by without comment or sign of umbrage.
If one is so foolish as to believe in the equality of the European Council, one has only to think how differently he would have reacted if it had been, say, Lynch or Thorn who had come round the table and taken me away.

What Schmidt had to say to me, however, was of considerable importance. He wanted to tell me about that morning's breakfast, which had not advanced things a great deal, except that Giscard had made it absolutely clear that if Callaghan did not come in, he (Giscard) would go along with Schmidt, and that France would be prepared to re-enter the Snake and stay there as from July. He, Schmidt, wanted me to know this, and to realize that Giscard was absolutely serious about it and he hoped that the British would realize the same. I was able to use the opportunity to tell him what I was proposing to say at the press conference afterwards, to which he said that he had no objection provided that it did not upset Callaghan, whom he wished to propitiate until he had had a private go at bringing him along. So I took the opportunity subsequently of telling Callaghan too what I intended to say, which he in turn took perfectly friendlily. Schmidt told me that his next step would be to talk to Callaghan, indicating that he would prepare a paper before this (though in fact he did not do so), and would keep in touch with me after that, as of course he would with Giscard.

After the session we had a hurried lunch with the three or four small-country Prime Ministers who had stayed (it was again typical that the big ones had gone), and I then gave an hour-long press conference (for about six hundred journalists) with Jørgensen, who did much better here than he had done as chairman. I apparently gave the impression of being extremely pleased with the outcome without saying too much. Left just after 4 o'clock by avion taxi for Brussels. An agreeable flight embellished by an hour's cultural conversation with Ortoli in French, which he, being in as ebullient a mood as I (but more surprisingly), seemed determined to have.

SUNDAY, 9 APRIL.
Brussels.

A perfect day, one of the very few this spring. Jennifer and I picked up Helena Tiné and drove down the Namur autoroute to picnic in the same field near Maillen, with a good open view across the lower
Ardennes, in which we had picnicked on the last warm Sunday of the autumn in mid-October after my return from Japan.

MONDAY, 10 APRIL.
Brussels.

Dinner in the
Economist
flat on a top floor in the rue Ducale, with their correspondents Stephen Milligan and Christopher Huhne, plus the Simonets. Milligan was obviously anxious to find out about Copenhagen. I decided to be too clever. I gave him a lot of circumstantial detail about who sat where, who talked a lot, who didn't, etc., but nothing of substance. However, as he subsequently published all the circumstantial detail, as well as a good deal of substance which he had picked up from elsewhere, it looked, not unnaturally, to Schmidt and others, as though I had told him the main story. Home at about 11.30, Solly Zuckerman having arrived to stay for three days.

TUESDAY, 11 APRIL.
Brussels and Luxembourg.

9.20 train to Luxembourg with Hayden, I suffering a post-Copenhagen exhaustion. To the Court of Justice where we thought we were lunching with Kutscher, the President. We discovered the building almost completely empty, certainly exuding an appropriate atmosphere of judicial calm. Everybody, secretaries, justices certainly, clerks, most of the
huissiers,
everybody in fact except one doorman and the Italian Advocate-General had gone to lunch. No sign of any lunch there or anywhere else. Hayden telephoned increasingly frantically and eventually discovered that the lunch was at Kutscher's flat about three miles away. No car by that time. We stood outside on a bright but extremely cold day waiting for the car for a long time, and eventually got to Kutscher's flat fifty minutes late. My temper uncertain by then. However, Kutscher and his wife were as always extremely nice and perfectly understanding, though rather a brief lunch with them and others from the Court because I had to answer questions in the Parliament at 3.00. Later, after a series of interviews, I gave a pointless dinner at the Golf Club for some parliamentarians allegedly interested in External Affairs.