Wednesday, 9 May 1990
Seanad Éireann Debate
Acting Chairman (Mr. Staunton): I am waiting for the Minister. As soon as the Minister arrives I am proposing to call on you to speak. Perhaps we could wait one  minute. If we do not have the Minister within a minute if you wish to speak without the Minister being present, feel free to do so.
Mr. Ross: I would like to thank the Minister for Justice for sitting in but I think he is obviously improvising. I would prefer to make the point that the Seanad should not be treated in this cavalier fashion and that we should have the Minister for Foreign Affairs or his junior Minister present. The sort of chaos that has reigned in this House this afternoon is simply being emphasised again by the presence — and he is very welcome — of the Minister for Justice. I regret the fact that the Government has not for some reason, and without explanation, been able to provide the appropriate Minister for a motion of this sort. Maybe we could have some explanation for that from a spokesman for the Government at some stage? It is high time the Seanad was provided with the right Minister for the right motion at the right time, and that we did not have Ministers giving of their time, which is good of them, simply because the appropriate Minister has not turned up.
Mr. Burke: The Senator can be assured that on a motion in relation to the unification of Germany, I would be more than competent and more than delighted to respond to the points the Senator would make.
Mr. Ross: I take your point, Minister. The Minister has already spoken in this debate, so I do not think you would be entitled to speak. I welcome the Minister for Justice. I say that with all sincerity, but I think it might be better organised and that we might have the appropriate Minister for the appropriate motion. This sort of thing has been happening continuously, and I regret it. I have no doubt  about the particular Minister's qualifications to speak on any topic, and particularly this one.
Having said that I will get down to the substantial motion which is the welcome to the unification of Germany. It is a Government motion. The first thing that should be said about this, which was said by the Minister of State when he spoke here during the first half of this debate, is that there is no question that we or any other nation in Europe or around the world can stand in the way of a country like Germany which has so clearly expressed its will to self-determination in the popular vote and the popular expression of the people. Whereas we may have reservations — indeed, I have reservations about the unification of Germany — there is such a clear will there from both parts of Germany and from both sides of Germany for this particular situation to come about that we cannot stand and should not stand in its way. We may urge notes of caution. We may express reservations but the principle of German unification as expressed by the peoples of Germany cannot be obstructed by us or by anybody else. Secondly, because Germany was such an obviously artificial divide it would be very wrong for us to say we wanted to perpetuate such an obviously artificial divide.
We all remember very well the reasons for the division of Germany. They should be remembered in this debate, and not just skimmed over. They were really two fold. One was a fear of Germany as a revived military power in 1945, where the great powers felt that Germany had proved over two world wars it was such a dangerous, belligerent nation and powerful nation that it could not be allowed to continue as one unit but that it had to be weakened and punished. That was the basis behind the division of Germany. The other basis was the wish of the great powers, both the USSR, in particular, and America and France and Britain to a lesser extent for spheres of influence which included Germany and which divided Germany into East and West, one part into the eastern sphere of  influence and the other into the US sphere of influence.
We should not be afraid to ask ourselves when we are debating this particular issue whether those fears still hold. We should remind ourselves that Germany in the last century was a dangerous and militaristic nation and that it has been belligerent. It has looked for conquest far beyond its borders. We should not be frightened of asking whether there is something in the German nature and in the German people which is aggressive and which ought to be curbed and watched.
In terms of modern warfare, modern military equipment and modern military methods those arguments probably no longer hold. It would be unrealistic to say that Germany is going to conquer Europe or further afield by force of arms. It would be unrealistic to say that Germany would have the power or would even necessarily have the will to be a military aggressor. What we have to look at is the possible economic consequences of Germany as it becomes a far greater unit. While we welcome what is happening and the principle of what is happening, we should not be unaware of what is going to happen because a united Germany which is undoubtedly going to come about in the next year or so, is going to be by far the biggest country in Europe in terms of territory. It is going to be by far the biggest in terms of population. It is going to have a population of 80 million people, all with this very worthy and great characteristic for hard work and building up economic power which many of the nations of Europe do not share. It is equalled only by Japan in the world today.
What we have to ask ourselves is whether we will accept German unification, which we do. Do we also accept that we are going to have Germany economically dominating Europe? Do we want that particular dominance? Should we take measures to check this economic dominance of Europe which seems to me at this stage to be the inevitable result of German unity? What we are doing in  our acceptance, and in some ways in our unquestioning acceptance, of German unity is accepting the transfer from Germany hegemony in Europe, which undoubtedly is there in economic terms, to possible German dominance in Europe in economic terms. We should look at the possible consequence of that. Already a divided Germany, West Germany, is by far the most powerful country in economic terms in Europe. We should also look at the effects this will have on Ireland. The principal effect it would have on Ireland would be on interest rates here.
The Taoiseach has made a statement about this, but there are conflicting views about the consequences of taking East Germany on board into the European Community and taking it on board as part of West Germany and about whether it will have an effect on interest rates, the economy and inflation here. What I suggest here is that inevitably the rush to German unity which is a political act in German terms as demonstrated by what they have done and which has made economics a subservient sphere will have economic effects on Ireland. That is principally because, first of all, we are a member of the European monetary system which is a Deutsche Mark based currency zone in Europe. We made a decision in 1979 to go into that. It was the right decision but we have to accept the economic consequences, that we are tied to the Deutsche Mark and, therefore, we are tied to the German economy. Not only are we tied to the West German economy now, we would be even more tied to the economy of a united Germany that would, if it could dominate the European system even more.
We have only to look at the promises which have been made by Chancellor Kohl in the past few weeks to the East Germans to realise the enormous cost which the West Germans are prepared to pay for this political and economic unity. The promise Chancellor Kohl made that the Deutsche Mark would be exchanged one for one against the Ostmark in terms of savings and, secondly, that after July wages and salaries in East Germany  would be exchanged on the basis of one to one as between the Ostmark and the Deutsche Mark. They are going to be extremely expensive promises for the West German Government to keep. Herr Kohl refused assistance from the European Community on this as a matter of pride rather more than anything else, because he was telling us that this was an internal matter for Germany and that they could afford it.
The significant matter for Ireland was that the promises which Herr Kohl made to East Germany, partly to persuade them towards unity and partly to hasten this great political desire which the Germans seem to have, were taken against the advice of the President of the Bundesbank who suggested this was going to be too expensive for the West German economy to take and that he should make a lesser offer. The independence of the Bundesbank was on this occasion compromised by Herr Kohl because he had made a political decision. It seems that he has the full support of the German people and that they are prepared to pay a heavy price for the unity of Germany. It seems also that he is prepared to make further concessions in order to achieve unity hastily. It seems that the price that the Germans, who are a very money conscious people, are prepared to pay for it is a lot higher than has been revealed.
The dangers to Ireland, I think, are basically economic ones. The reason why I think interest rates here will rise and why the Taoiseach and others who say, more in hope than in reality, that they will not rise, is that in the German Democratic Republic, that was, there is a huge reserve of savings. The people of the GDR, because they are not a consumerled society, have had nothing else to do with their money except to save it. As a result of that, they have, I think 177 billion Ostmarks stored up in East German banks. They could not spend the money because there were no consumer goods to spend it on. As a result of this, they are going to spend that money at the exchange rate given in West Germany in the whole of Germany on consumer goods. The result of this, and the price  which the West Germans are prepared to pay, will be that West Germany will print an enormous number of new Deutsche Marks which with fuel inflation in that country. That will, of course, have consequences not only for the Germans but for the whole of Europe.
Germany is the leading country in Europe in economic and industrial terms. If inflation goes up there inflation will inevitably be imported into the other countries of Europe. If that happens the interest rate will inevitably rise to protect the Deutsche Mark, which will be the answer from the Bundesbank to Herr Kohl. Being partly linked with the Deutsche Mark we will either have to devalue the £IR or we will have to raise our interest rates as well. To say that German unity will not cost us anything is economically wrong. We might be lucky. Interest rates throughout the world may start to take a tumble. It is unlikely, but they may, in which case in the natural course of events the interest rates in West Germany will fall and our rates will fall as well, but not as fast as they would normally. Because we are linked, we will follow the Deutsche Mark and interest rates in Germany, up and down. That is inevitable. It is inevitable that it will cost West Germany a lot of money. As a result, it is going to cost us some money — and possibly create inflation — but not so much in terms of inflation as in terms of interest rates.
The other warning which I think I should issue — and I say this without pomposity because it is not an original idea — is that in the light of what was said on the other side of the House, which was uniformally favourable to German unification and no fault was found in it by Senator Lydon or by the Minister when he spoke with some caution but without any criticism, it seems that the expectations of the East German people are almost unlimited at this stage. They have been exposed through television and by the media generally to the West German way of life. Their dreams about the West German way of life are utopian.
One of the reasons they wish to move towards unity is that they can see the consumer society as some sort of panacea  for the ills and the lack of prosperity which they have suffered for so long. They think that unity will suddenly bring them this great wealth and prosperity which the West German people have enjoyed for so long. They forget, I think, that the West German people have earned that prosperity very hard over a very long period of time. They also, I think, are oblivious, and by choice oblivious, to the fact that they will also lose some rights and some privileges when they become part of a united Germany. Whereas the Eastern system had many faults, many drawbacks and was intolerable in our terms of freedoms, in terms of prosperity, in terms of consumer spending, in East Germany they had certain rights, like the right to a house, the right to homes, the automatic right to jobs, which they will not have when they become part of a united German state.
Finally, I would like to say that in military terms a lot of controversy has surrounded the issue of whether a united Germany should be part of NATO. I would have thought that the result of the unification of Germany should be that we look at NATO again. We should say: “No, this should be the start of a dismantling of NATO” It is obvious to all of us that the Warsaw Pact is a dead duck and that as a military unity there is no such thing as the Warsaw Pact any longer. It is the ideal opportunity for the Western powers to get together and say: “NATO is no longer relevant; it is no longer topical; it is redundant. We do not need NATO”. I resent the sort of protective manner in which European countries and America are trying to put pressure on Germany for a united Germany to be part of the North Atlantic Treaty Organisation. The opportunity must be taken for the North Atlantic Treaty Organisation to be dismantled as the Warsaw Pact is being dismantled involuntarily. I think as a military move and in military terms——
Mr. Lanigan: In addressing ourselves to the motion, we have to be careful that we do not go overboard in suggesting that this remarriage between East and West Germany will create a Utopia either for the people of the East or the West. Profound changes have been taking place in the political spectrum all over Europe over the past eight or nine months. Not alone have we seen profound changes taking place on the European scene, but, equally, there is a willingness on the African continent by people who have been in conflict for many years to come together and address themselves to the problems which have kept them apart for so many years.
We have seen changes take place on the South American continent. Changes are taking place in Nicaragua and in the Central American states. There are changes taking place all over the world at present and there is a genuine welcome for the re-emergence of political democracy as is seen in many of those countries where changes are taking place. It should not be forgotten that in many countries which are now changing their political ways democracy was not the method by which they were ruled prior to the breakup in Europe in the thirties and forties. Many of those countries that are now changing into democracies were theocratic states or monarchies and were a long way away from democracy as we know it.
However, we must welcome the fact that profound changes have taken place in East Germany. Fears have been  expressed that we will see a monolithic Germany re-emerge which will change the balance of power throughout Europe and this at a time when it seems that the monolithic state of the USSR is breaking up into its former constituents, or if not former constituents back into ethnic and nationalistic areas which existed for a short time in the late 19th century and early 20th century.
It has been said that the break-up of the USSR is of major importance and that it will weaken the status of Russia and its satellites and that this will bring the balance of power more towards the West than towards the East. However, it should not be forgotten that irrespective of what is happening in the USSR at present that country still has the biggest army in the world and that if Mr. Gorbachev and the Supreme Soviet so decided they could by weight of arms take out many of the smaller states with whom they are now in political and economic conflict. A member of the Supreme Soviet summed up the problems that exist in the Soviet Union at present when he said that glasnost had to be supported because there was no going back to the pre-glasnost era without going back the whole road to a Stalinist totalitarian society. He also said that the USSR would still be a super power but a super power not of Bismarck but of Pushkin. In other words, they would be pushing to be a democratic and economic power rather than having the world's biggest army. On the European scene we have seen changes taking place in all the states of Eastern Europe, changes which took place over a period of only three or four months. One wonders if that was a genuine expression of need to change or a push from the existing systems of government in certain areas because there is no doubt but that many of the countries of Eastern Europe were economically on their knees. There was a genuine fear among the Governments of those countries that the people were going to take over anyway. There might have been a push in certain areas in those countries for changes, not from the need  to democratise but for purely economic reasons and reasons of fear.
People in Western Europe are fearful of the economic power that might be generated by the unification of Germany. I would not have great fears on that basis. There is no doubt that West Germany needs the workers from the East and the workers from the East need to increase their economic status. The cost will not only be to Europe, it will be to Third World countries who have been supported by the European Community over a number of years. There is a fear that because many resources will have to go towards rebuilding the economies of Eastern Europe and, from West Germany's point of view, to build up the economy of East Germany, we will see a reduction in the amount of aid and support that will be given to Third World countries, whether these Third World countries are in the Far East, Africa or the near East. Many of the people in these countries are living in poverty at present and any reduction in aid from Europe would have drastic consequences.
West Germany has been seen as the bastion of capitalism in the West and there is no doubt it was one of the major capitalist powers not alone in Western Europe but in the world. There are fears in West Germany that because of the big influx of East German workers wage rates will go down in West Germany and, therefore, the standard of living will go down. There are already hints of unrest among steel workers and mine workers because their compatriots from East Germany are willing to work for less than the going rate. This could cause economic problems for the West Germans and for a united Germany.
From Ireland's point of view we have to be a little fearful that interest rates might increase as a result of the coming together of these two huge countries. There are implications for us on political, economic and military levels. The problems associated with NATO and the Eastern powers bloc have to be resolved. Nobody would like to see East and West Germany holding the balance of military  power in the middle of Europe because there are still people who remember what happened when they had this power before.
We wish the peoples of East and West Germany every success in their efforts to recreate one state. Now that the East and West Germans have been able to sit down and iron out their problems there is a lesson to be learned here for those on this island and on the island of Britain who do not wish to see a reunification of this island. When Mr. De Klerk and Mr. Mandela can sit down in conference to attempt to bring together two different peoples it should not be outside the bounds of political possibilities that the problems associated with the reunification of this country could not be addressed successfully.
Like the other speakers in the House, I welcome the changes that are taking place in the two Germanys. I look forward to the day when Germany will be a political entity playing a major part in supporting the economy of the EC with the other member states, including our own. Even before 1992 the EC is the biggest economic bloc in the world, having taken over from Japan. It is bigger than the USA at present. Twenty five per cent of world trade now goes through the EC and that is a huge amount of trade by any standards. With the coming of the integrated Community on 1 January 1993 I can see tht this economic power block will be much stronger and that the East and West Germans will play their part in that. It is not being forgotten by trading partners, such as the United States, that this power bloc is emerging, because at present we see desperate efforts being made by the United States and Canada to form an economic power bloc. They are coming together very rapidly. I was just looking at an economic statement from the Canadians the other day that the State of Ontario does more trade with Japan than Japan does with the United States. So one can see that Canada and the United States together will be a formidable economic power bloc as well. We congratulate the peoples of East and West Germany, the West Germans on  their foresight and the East Germans on their ability to throw off the shackles that were holding them fast for the past 40 years. We re-welcome them into the family of the West. As I have said, I cannot but welcome this motion.
Dr. Upton: At the outset, may I welcome the fact that the Fianna Fáil Party, the Government Party, have seen fit to introduce this motion and put it before the House? I think that it is very timely that they have done so. I also welcome the developments in Germany and the moves towards the unification of Germany. I welcome them because in many ways it is inevitable but of course there are a series of other reasons also why it should be welcomed. The unification of Germany involves enormous changes. You are talking in terms of creating a new Europe, and that has major implications for all of us. In this country we must be very aware of what is happening. It is very important that we should play our part in determining what the ultimate shape of Europe will be. There are approximately 18 million people in Eastern Germany on relatively lower standards of living, etc., and that, of course, has to have very profound implications when it works its way through the whole system.
There are a number of practical aspects of the integration of Eastern Germany into Europe to which I feel, we have not given enough thought. There will be very big questions in relation to the agricultural policy. What adjustments will be made to the Common Agricultural Policy and how will those adjustments affect the Irish farming community and, indeed, the country in general? I am not sure that we have fully thought through what the effects will be, although to be fair about it, I am not sure either that it is possible to say with clarity the manner in which those ramifications will work their way through the system. Certainly, I feel confident that it is not easy to predict accurately what those effects will be on this country over, say, a ten year period and beyond that. For example, what will be the effect of all this on milk quotas? What  will be the effect on the way Irish farming is organised? What will be its effect on the food industry? On the one hand, the expansion of Europe will create major extra opportunities in the market for Ireland; on the other hand, it may also create much greater pressure on our quotas which, at this stage, are pretty pressured anyway. What will be the implication for the other aspects of farming, many of which are doing very badly at present?
In addition to that, there is the question of the wider implications of the effect of German unity and the drift towards European unity which we are seeing at present. This, of course, creates considerable economic opportunities for Ireland. There must be great opportunities and scope for us to become involved in the development and in servicing the growth in the underdeveloped countries of Eastern Europe. There will also, of course, be the question of aid. That has been discussed to a fair extent by a number of Senators already, but I think the implications there are very farreaching. There will be the impact of this development on inflation. Certainly it seems as if the impact will be one of increasing inflation and that, in turn, even in the short term, has fairly profound implications for this country. Whatever happens in Eastern Europe, and in Eastern Germany, or in the united Germany, it is very important that the European Community should in a very fundamental way shape the developments in Europe generally and should shape those developments as they affect Ireland.
The history of central Europe has been one which has been littered with problems relating to ethnic minorities and feuding which has gone on for centuries. The potential for instability and confrontation in central and Eastern Europe is considerable. The whole phenomena surrounding the unification of Germany and the wider questions of the unification of Europe create an atmosphere of uncertainty. It is very important that in that atmosphere of uncertainty effective processes and structures for co-operation and for the resolution of problems should  be organised. It is very important that these should be proper facilities and that every effort should be made to ensure that problems are resolved in a peaceful manner. That certainly has not been the history of Europe in the past and one has to have a certain degree of concern about what way things may take shape in the future.
The experience of the European Community is clearly very relevant to the developments in Eastern Europe and in Eastern Germany and it is very important that we learn from the developments which have taken place in the formulation and growth of the European Economic Community.
In conclusion, again I welcome the fact that the Fianna Fáil Party have taken the initiative to introduce this debate in the Seanad. We should approach the whole issue of German unity in a framework and in an attitude of optimism but we must also be very conscious of the fact that there are quite considerable risks involved if the problem is not handled properly.
Mrs. Jackman: Like the other speakers I welcome the unification of Germany. Though politics have been described as the art of the possible, a recent quote by President Havel describes politics as the art of the impossible. No one could believe that the Berlin Wall could come down so quickly with most of the European countries making brave attempts to achieve freedom, parliamentary democracy and a market economy. We in Ireland have to respond quickly, openly and decisively to the thirst for freedom, personally and nationally, running right through Eastern Europe. We have experienced that thirst and desire for freedom throughout the centuries and therefore, we welcome enthusiastically the prospect of German unification. We cannot deny the people in these two countries the right to self-determination, which will be a reality in the near future. Although German unity, a term more favoured by Willy Brandt, is principally a question for the Germans, it has, as other speakers  have said, major repercussions for the Continent as a whole.
We in Ireland are constantly concerned with our identity, our Irishness. Germans now must address the intricacies of their identity. West Germans had almost given up ever experiencing the re-integration of West and East Germany. The idea of unity is embedded in the Federal Republic's basic law in the preamble that all future German Governments should work towards completing the unity of the nation; and, though it may have seemed a dream throughout the years, it is now a live option. It is that dream really which sustained the East Germans during their darkest hours of serfdom. What West Germans can offer now to their Eastern brethren comprises everything that they themselves have learnt since the inception of German democracy after World War II: democracy, the rule of law and the experience of setting up a successful economy.
Of course, building a new Germany entails a new Europe. The analogy of architecture has been used to describe this new Europe: democratic politics as the foundations, market economies on the ground floor and an over-arching security roof to keep out acids and nuclear rain. The site has more than a few problems and, finally, not all of the inhabitants are house trained. This is not my quotation; it is a quotation from Wittelsbrod, of Cabinet of Vice-President Andriessen of the European Commission in a paper he gave here to the Irish Council of the European Movement in March of this year.
After designing the architecture, going back to the building analogy, the construction will start and, as in building ordinary houses, will take more time. Since the Federal Republic of Germany was founded it has been German policy to try to solve the German unity question at European level in co-operation with European neighbours and friends. Any isolated or separate solution would contradict the logic of the process of unification embracing the whole of Europe. The dramatic and political changes have  shown that the economic systems based on central planning and control have failed. Over the years a massive prosperity gap formed between East and West. Now that the borders are open these gaps will need to be bridged urgently.
In the case of the two Germanys, where there are no legal, linguistic or cultural barriers to migration, the existing disadvantages in terms of income in a particular economic area, provide massive incentives for emigration, especially where in the German Democratic Republic the average income of gainfully employed persons is less than a third of that earned in the Federal Republic of Germany, No wonder 400,000 citizens of the German Democratic Republic have moved to the Federal Republic, many for economic reasons. The danger here is that that number may increase dramatically if the people in the GDR do not get confirmation of an early improvement in their situation through fundamentally reforming their system of Government and their economy, and steps have been taken to ensure obviously at this stage that this is happening.
It is urgent that development towards constitutionality, democracy and market economy is supported vigorously. The required improvements in the economic field will only be achieved through a fundamental reform of the present economic system and a clear decision in favour of a system based on market economy and co-operation. Competition has always been the hallmark of German competence. The reforms necessary for East Germany include (1) granting the freedom to choose one's trade, occupation or profession; (2) ensuring the freedom of contract; (3) enacting new constitutional provisions on property; (4) price reform; (5) reforms of regulations on the corporate legal structure, and (6), reform of the monetary and credit systems, the financial systems and taxation and the abolition of the Government's monopoly in foreign trade. If that confidence can be created it will, on the one hand, reduce the pressure for emigration from the German Democratic Republic and, on  the other hand, will permit that transfer of capital into the German Democratic Republic which is so necessary to level out the existing prosperity differential in what hopefully will be a foreseeable span of time.
In the Federal Republic willingness to enter into commitments in the GDR is very strong. Way back in 1953 Ludwig Erhardt predicted in the event of reunification “That the entire economy of the Federal Republic will be ready to help the Eastern economy, both in word and in deed, to fulfil the task of bringing performance into line”. His words are prophetic. Yes, as many incentives as possible must be given to the people in East Germany to help them rebuild their country while allowing the full benefits of membership within a confederate Germany. That is the road they will take. The people of the Federal Republic must be educated about the price tag of reunification. We in Ireland must be educated about that price tag too. Members have already referred to perhaps a possible reduction of EC aid to Third World countries, which would be very regrettable.
The concept of financial responsibility, tax increases, etc., will be put before the people of West Germany and they have to face up to them. Because, after the first euphoria, the realities of day-to-day demands in West Germany — where the housewife was crying that there were, for instance, no bananas on a specific day because of the influx of Eastern Europeans — will cause what I would consider day-to-day irritants and a certain amount of obvious disgruntlement. So there will be growing pains, as it were, during the transition period and there must be patience and there must be tolerance.
We, among Western democracies, have to anticipate great commitments to the previously socialist countries of Central and Eastern Europe; but, as other speakers have said, we must look positively at the exciting perspectives for Europe in the economic field. Hopefully the nineties might develop into a decade of economic dynamism and prosperity for the whole of Europe. Ireland will be  faced with threats, will be faced with opportunities. Our ability to exploit these opportunities will outweigh the threats if we use business and industry, State agencies, financial and educational institutions to forge links with our Eastern European neighbours; and these, hopefully, are already in progress within those agencies. Many Senators and Deputies have visited Eastern Europe over the last few months and no doubt they are looking towards the forging of those links.
Of course, the changes in Eastern Europe as a whole will have an impact on the European Community as it approaches 1992 and the goals of broader economic and monetary union, and the unification of Germany will have an impact on the speed with which European Community integration can be achieved. President Delors has given a figure of a price tag of IR£10 million for structural fund support for Eastern Europe on a level currently pertaining to the peripheral regions of the EC. Of course, we must be vigiliant too in ensuring that our peripheral regions will receive what we need to build our economy. But we must not be too selfish. We must forget our own self-interest. We must keep it in mind, but we must look towards whether we really want a unified Germany in action, not just in words or in a sort of acceptance, without realising that there is a price tag and that we will be affected. Mention was already made of perhaps rising interest rates as a result. The debate at the moment is whether the funds will come from additional resources or whether existing budgetary flexibility will be used to channel funds to Eastern Europe.
So, there are major implications, not just for ourselves but for the other peripheral regions of the Community. As I said, we are living in an age of accelerated rates of exchange but at the same time we must respond decisively and positively in a spirit of co-operation and it is in that spirit that I welcome, with the other Senators in the House, the unification of Germany.
Mr. Norris: I cannot really welcome  this at all. Actually I think this is just about the greatest load of tripe I have heard since I have come into this House and I will tell you precisely why. Suppose for example, Seanad Éireann were to vote against the unification of Germany. What does this House imagine would be the effect? Would Chancellor Kohl and his counterpart sit up in the Bundestag and say, “Gosh, Seanad Éireann have voted against the unification of Germany. We must not go ahead with our plan”? I really think that the reason we are discussing this is that the Government have no serious business. This has been evident during the day. That is my candid opinion because the debate here can have very little effect.
Mr. Norris: I quite agree, Minister. That is a most effective and useful intervention. If we really cared about them I will tell you what we would do. The Minister is a decent person and I am sure if he had the individual capacity — which I, as an Independent have — for stating a genuine opinion, he would agree that nothing highlights more than this debate the nonsensical and ludicrous situation that we are the only country in Europe that does not have a foreign affairs committee where this kind of matter could be properly discussed. It is absolute nonsense to have an empty, rhetorical debate full of po-faced cermonising about what we have to do, what the Germans of various kinds have to do. It is absolutely ludicrous. However, that never prevented me from having my “spake”.
We can learn even from the language employed not just in this debate but in the titles of the different countries. The German Democratic Republic is what is at the moment being dismantled. How did it become democratic? It became democratic by being so named. We are now in the process of examining minutely the crumbling of this species of “democracy” throughout Europe. But before we  bleat our way into self-congratulation we ought — since we are prepared to engage in strictures upon Eastern Europe — to engage in a critique of our own society and look at democracy in Ireland and look particularly at institutions like Seanad Éireann and Dáil Éireann and at the way in which they may be reformed. What we are looking at in Eastern Europe is people power, the invasion of the jealously guarded precincts of parliamentary power by a risen people. I am not sure too many Members of either House here would be that enthusiastic for this to occur here and particularly the Government of the day.
Consider the way in which legislation is so strictly controlled by the Government party, the way in which, for example, delegations to international parliamentary meetings are controlled and the small voices, the voices of individuals, of the minority groups or the weaker parties are ruthlessly squeezed out by both the main parties. I can speak with some small experience of this as can the other Independent Members. This has been done to me in the name of democracy at international meetings. Let us be quite clear on our attitude. Let us not be sanctimonious and hypocritical.
First, we have to look at our own attitudes, set our own house in order. We have also got to look at the implications of a united Germany. They are serious. There will be created an enormous,  immensely powerful economic bloc right in the centre of Europe. Make no mistake whatever about that. My colleague on these benches, Senator Jackman, touched a memory chord of mine when she mentioned Ludwig Erhardt. I remember Ludwig Erhardt very well — a most brilliant man, the designer of the Wirt-schaftswunder in the 1950s and 1960s, the economic miracle of German recovery. He was quite right, that this recovery was so strong it might in fact support reunification of Germany. That will create so strong an economic bloc in the centre of the European Economic Community that it is going to distort the existing economic relationships. Let there be no question of doubt about that.
Let there be no question of doubt about another fact and that is the hypocrisy of people at the level of the European Economic Community. Perhaps the Minister might address himself to this point. We are prepared to support Eastern Europe for political reasons; we are prepared to support the reunification of Germany; we are prepared to support East Germany, the former German Democratic Republic — how, very practically? We are prepared to engage through the European Community in the secondment of civil servants, of bureaucrats. We are prepared to establish a banking support system. Nothing wrong with that, you may say. Is there not? They have been asked for these services before. They have been asked for these services to support what is sometimes called the Third World, the southern hemisphere countries, and they have refused. They have refused, in other words, in the name of economic self-interest to support the most deprived, the most suffering, the most discriminated against peoples of this globe and they have refused to do precisely those things which they are doing in terms of political self-interest for Eastern Europe.
I would like to ask why can they not use the economic muscle in a moral fashion to support people who are at least equally our brothers in the most deprived sections of the worlds. If this country can add any little, small groat's worth of wit into  this debate it should be from our experience of domination, of deprivation, of famine and of being marginalised at the extreme edge of a powerful colonial interest. That is the kind of point I would make if there was a serious forum like a foreign affairs committee in which to make it. Those are very important matters that need to be considered.
Let us also consider the human angle in terms of the relationship between the two Germanys, because all is not sweetness and light there, and I am sure the Minister is well aware of this. Look, for example, at the response of people in Berlin to the invasion into East Berlin of West Berliners in their fast cars with their fast bucks and their fast lane lifestyles and the way in which they have already succeeded in alienating considerable sections of that population by their vulgar display of wealth, their condescending attitudes and their view that they can buy anything or anybody and that the people who operate as waiters, attendants in shops and so on must jump to it because of the power of the almighty Mark. There is strong resentment growing in East Berlin about this and the Minister, I am sure, knows this as well as I do. It is going to be the same in East Germany when they wake up to the actual realities of economic life in the West. I am not saying that everything was wonderful in East Germany. Of course, it was not; it was deplorable, a lot of it but let us bear these things in mind when we are talking of East Germany and the reunification of Germany.
Let us bear in mind a couple of other things. I agree 100 per cent with Senator Shane Ross when he said that the Warsaw Pact is collapsing, disintegrating, and thank God for it. We should assist in the ordered dismantling of NATO as well. It is wasteful, immoral and against everything this country should stand for in terms of international diplomatic and political influence. I hope we can get some degree of movement on this dismantling. Particularly since we are a neutral country, our position should be one of pushing people in the direction of the dismantling of NATO.
 I have a final point to make about the record of Germany. It is important and I made it in no racist sense. I have just come back from Jerusalem. While I was there I visited the Armenian museum where there was another attempted genocide — two million people killed in 1915 — an anniversary which we so conveniently forget. I cannot forget that genocide. I cannot forget the genocide committed against the Jews, nor can I forget that the trial run was made against the people with the pink triangle, the Gay community in Germany. One question could be asked: I wonder if any Government politician from this country would have the guts to ask it of the German people, and it is about compensation. I know that the East Germans are making available some comparatively small token sum of money as a gesture to compensate the Jewish people who were victims of the holocaust in Germany.
I would like to remind the Minister that the first people incarcerated were the homosexual people of Germany. They were the first people medically experimented upon and they were the first people exterminated. They have never been compensated. I attended a conference in Torino in Italy ten years ago and I asked the German delegation why none of the Gay prisoners had ever applied for compensation. The answer was astonishing. The answer was that they had applied and, having applied, they were returned by the Government of the Federal Republic of Germany, which we think is the really democratic one, to complete their sentences. No question of compensation has ever arisen.
This question came into my mind late in the day and I have had quite a lot to say about the international, economic and diplomatic status of the question of the reunification of Germany. I think this is an important one. Is there going to be in the reunited Germany any compensation? I would like to quote from the autobiography of the Commandant of Auschwitz, Rudolf Hoess, talking of the treatment of homosexual prisoners:
 Neither the hardest work nor the strictest supervision was of any help in these cases. Whenever they found an opportunity they would fall into one another's arms. Even when physically in a very bad way, they would continue to indulge in their vice, they were easy enough to pick out. Their soft and girlish affectations and fastidiousness, their sickly-sweet manner of speech and their altogether too affectionate deportment towards their fellows distinguished them from those who had put their vice behind them and wished to be free of it, and whose steps on the road to recovery were visible to any acute observer.
Could Jonathan Swift write more trenchantly “their altogether too affectionate deportment towards each other” by the Commandant of Auschwitz. For this they were punished, for this they were tortured, for this they were medically experimented upon and they have never been compensated. I would like some movement towards their compensation.
During the Olympic Games the beggars and tramps were cleared off the streets and put in workhouses and concentration camps and, at the same time the many prostitutes and homosexuals were rounded up in the town and at the bathing places. They were to be trained to do more useful work in the camps.
This debate is a complete nonsense as I said at the beginning. Were we in Seanad Éireann to vote against the unification of Germany it would have damn all effect so it is a nonsense in those terms. We can do certain small things. We can raise the economic discrimination practised as part of this package against the weakest sections of the globe and we can also raise the question of compensation for people. I admit there would be ironies, ironies that were revealed today here in the vote  which the Government lost, in the fact that we still discriminate ourselves but I will leave it to the Minister. If he wants to do anything at all practical — I do not believe he does — but if he does those are a few small suggestions.
Professor Murphy: I thank my colleagues. When I scribbled a note to Senator Norris asking for one minute I meant literally that because there has been so much said and so much written about this topic and, as Senator Norris says, it is rather Skibbereen Eagle-ish to think that this debate will make any difference. There are so many things in this country that we in these Houses can do to remedy that it seems a trifle academic to be talking about this matter. Nevertheless, for any European not to make some comments on this momentous event would be very remiss and it is in that spirit that I mention a few points.
When Germany becomes one Germany, becomes Berlin-centred rather than Bonn-centred, becomes a country which has rid itself of foreign occupation and, therefore, in a sense will be for the first time not only united but sovereign and enormously powerful, I hope it will not be a different Germany. Senator Norris is right to raise the spectres of the past. Any historian must raise a question mark about the reliability of the German people as good Europeans and as democrats. I hope the new Germany will be able to resist the blandishments of those Germans in the lost territories, as they see themselves, and who certainly will pursue trouble in their own interests. I hope that will not happen. I hope there will be no Fourth Reich or anything like it. I also hope the East Germans insist on salvaging from the ruin of their own State the best values in that State, the concern for social values, the concern for human dignity, which frequently is absent from the rampant free market economy of the West. I hope that will happen, too.
Senator Norris said we cannot do anything anyway about a united Germany but it is not altogether true. As a member of the Community we can be more positive instead of tugging our forelocks to  the paymaster and saying: “Whatever you do yourself, Sir, is OK with us”. We can insist that this united Germany must not be part of a rearmed Europe, that the new Europe must be free of armed alliances apart from the minimum necessary to secure the security of its peoples from the Atlantic to the Urals. These are things we must insist on and especially as a country which cherishes neutrality, we cannot complacently accept the idea of a united Germany in NATO.
Finally, and most important for Irish people, let us not draw the wrong moral from German unification. I am afraid this has already been done in a very simplistic and disingenuous way by certain politicians from the Taoiseach downwards, namely, the simplistic inference that because the Germans are fortunate to have ended the artificial division of their country that points up the so-called artificial division of our country. The two cases could not be more different and we must realistically appreciate that. The Germans are being reunited because they want to be reunited, because they are, indeed, one race, one culture and one language. On this island we have the awkward and unpleasant fact that there are two nations on one island and that no matter how unjustly the Border was drawn it represents some kind of reality. To draw the German analogy and to apply that analogy is inaccurate, disingenuous and very dangerous.
Mr. O'Toole: Far be it for me to disagree with my learned colleague and historian Senator Murphy. Whereas no two cases can ever be seen to be absolutely and completely similar, the fact that might be well considered from the history of Europe whether it be Cyprus, Germany, Ireland or indeed many other examples, Schleswig-Holstein or Alsace-Lorraine that partitionism does not work anyway. That is in the sense of being somewhat of a facile comment in response to what Senator Murphy has said. I do not think it is fair to draw the conclusion and I think he is quite right there. Neither do I feel it proves the opposite.
 We discussed in the House the changes in Eastern Europe last November and we listened to a lot of patronising comment about Eastern Europe. I believe now there is a more realistic assessment of what is happening there and what is happening in Germany. I want to talk about a number of aspects. I want to talk in the first place about the whole question of NATO, which was touched on by my colleague Senator Murphy. It seems to me that the most positive thing coming from the unification, or reunification depending on which point of view you take, of Germany would be the fact that we could look forward to seeing what is now West Germany retreating and leaving NATO. Certainly that would be a matter of some importance. I firmly support the idea of the non-aligned states. I believe that the Warsaw Pact and NATO are neither progressive, positive nor helpful in the creation of a global understanding among peoples. I hope that the reunfication of Germany will lead to a German involvement in the non-aligned countries of the world.
I would like to put in a note of caution. It is fair to remind ourselves of the difficulties that have arisen in Germany, the difficulties that have arisen in the first 50 or so years of this century which really can be put down to the German policy of aggrandisement, of empire building and land grabbing or country grabbing. It is fair to remind ourselves of that, it is fair to remind ourselves also, as Senator Norris has done, about the difficulties experienced by the Gay community, the Jewish community and by other minority groups.
It is important that we take into consideration the loss of life to the German people. The discussion we are having tonight could have taken place two years ago about Russia. Two out of every three people who were killed in the Second World War were Russians. The Russians have had enough of war. They have lost generations. The countries in Europe who had that experience have never been inclined to rush back into it. I do not believe the German people want to be involved in that kind of situation ever  again. Maybe I was born a couple of years too late. I do not remember the war.
We have heard how the Germans created suffering for other races, groups and countries. History proves that fact but they also suffered themselves in every way, physically and morally. We must recognise that there is a sense of guilt in individual Germans about what happened earlier in the century. I do not believe there is the slightest possibility of that ever happening again. It is easy to go back through history. It is a matter of whether one believes that history repeats itself or whether one believes that we learn from history. If one believes that history repeats itself in this inevitable way then there is some substance to that.
In 1988 I spent time studying the developments in Estonia, Lativa and Lithuania and the past between Stalin and Hitler which destroyed those two countries. I do not know if the Members have had the opportunity to read a most poignant interview in The Irish Times this week with the last Foreign Minister of Lithuania. This interview outlined the way that people suffered, a suffering created by a pact between Hitler and Stalin. We can criticise all that has happened in history. We could look back over our own history during that period and find plenty that we would be critical of and think that we would not trust the descendants of the people who took part in certain events.
This development is a positive one. Moves towards unity are, in the main, positive moves. It is a creation of compatability amongst races and groups. I worry somewhat that many of the negative statements that have been made about German unification have smacked of racism. I do not think it is correct to assign views, attitudes and so on to people because they are part of a particular race.
I would like to continue on the point that was raised by Senator Norris, the question of the values of the free market. The people of Eastern Europe who, in the main, have come from regressive centralised governments, totalitarian States running command economies, might now  feel that there is some enlightened future in the selfishness of the free market. The free market means that operations, factories and industries are established in order to create a profit. The citizens of what is now East Germany will have to come to terms with unemployment, poverty, poor housing and the other difficulties that are experienced by citizens of Europe.
There is very little remaining to add to the debate. Most issues have been covered but there is one issue I would like to deal with quite firmly. The citizens of this country have been misled and fed misinformation for the last two months about the economic impact of German unification. The largest selling daily newspaper has had three banner conflicting headlines over the last month. One headline stated: “German unification is going to create a hike in interest rates, mortgages etc.”. A week later “This is not going to happen”. A week later a leaked document from the Department of Finance indicated that that is going to happen. That is an issue that should be addressed by Government. The facts, as they are available to Government, should be made available to the people.
I no longer trust economists. I trust and believe economists when they are assessing, analysing and explaining past events. They have never yet been correct in forecasting the future. I listened to many of them spouting on radio and on television, and read their comments in the newspapers about the impact that German unification will have on increasing interest rates. I also listened to our own Minister for Finance and the Taoiseach denying this.
None of the economists I listened to gave me a logical reason why the unification of Germany will lead to a rise in interest rates. On the other hand, the Minister for Finance and the Taoiseach, who did not accept this, did not give an explanation as to why they did not agree with them, either. Unfortunately, we have a very poor history in this country in regard to making economic facts available to the people. We have come  through the last decade where at one stage we alternated Taoiseach — between an accountant who acted like an economist, and an economist who thought he was an accountant. We never really got anywhere in terms of knowing where we were with economics.
I have taken the time to study and look at the impact of German re-unification on the interest rates. The West German economy is the healthiest economy in Western Europe, and if it is not the healthiest and wealthiest in the world it is very close to being so. The proposal, in terms of exchange rates between the East German Ostmark and the Deutsche Mark and the various exchange rates that have been offered — one for one, two for one or three for one — is in black and white. The population of East German is 16 million. Each one of those 16 million will be able to convert approximately 4,000 East German Ostmarks for Deutsche Marks on a one to one basis. It is easy enough to work out the cost of that. It works out at something like 120 billion Deutsche Marks.
We are really talking about printing money, printing West German Marks to the extent of 120 billion. This is a huge amount of money in Irish terms. It is the total amount of the budget for the Department of Education for one year. In terms of the gross national product of West Germany it works out at less than 5 per cent. It is important for the Minister for Finance to put that on the record because there is a hype on this issue which is worrying people and is being abused by people in many ways. The effect of the East German Mark being assimilated into the West German economy will create an inflation of 5 per cent. This means printing money to the extent of 5 per cent of what is the present GNP of West Germany. I believe West Germany can handle that very simply. It can deal with it without any huge increase in interest rates.
This depends on two things. It depends on what the people do with the money. We now have the East German who has got 4,000 Deutsche Mark for the first time in his or her life. Where did they get  the money? They got the money because in the old regime they saved. Why did they save? They had to save because they had nothing to spend the money on in the old regime so they had to put it in the banks. They are now changing it into real money, they can buy real goods, consumerism will run rampant. If they spend that money on West German goods, that will heap up the West German economy and will certainly create a certain level of inflation because there will be internal demand paid for by money they have just printed.
On the other hand, if they spend it on Irish, Italian or Russian products, then it will have an effect on the German balance of trade, the trade surplus, which is extraordinarily healthy at the moment and will certainly absorb some level of that 5 per cent. That must be thrown into the ball game. The productivity of East Germany is not being thrown into the mixer at all. They will not just be coming in sitting around and taking for the rest of their lives. They will also be working, they will be producing, they will be adding to the economic growth of what will be a united Germany and will create a healthy economy there. It certainly could lead to interest rates being raised in the rest of Europe but it is not inevitable. The more I look at it, the more I examine it, the less likely I feel it is. The people who are worrying unnecessarily on this issue should be called to account and asked to prove it. People are afraid of economists, they are afraid to ask a simple question. Economists should always be approached in this manner saying, “I do not understand the language you are using. Would you please explain to me how the reunification of Germany will create an increase in my mortgage payments, take me step by step through it.” It is an issue that is there to be discussed.
I personally welcome the developments towards a reunited Europe. It is healthy. Of course, it needs to be monitored. The Community should take every possible step to insist that the assimilation of Eastern Europe into the  community will require the same stringent examination, the same fulfilment of conditions as we required of Portugal, Spain, Greece and we are now requiring of Turkey. There should be no short cuts taken but at the end of the day we welcome the creation of a new Europe. I would certainly look forward not just to a united Germany but a single Europe from the Urals to the Atlantic, that we would have a community understanding each others differences, accepting each others differences, a pluralist, multiracial community working for each other, where the question of being aligned on one side of Europe or another would not arise, and where being a European meant something that did not take from one's nationality, whether it be Irish, German, Russian or whatever it is. I welcome the debate and I look forward to the Minister's reply.
Mr. Lydon: I would like to thank those Senators who contributed to this debate. The contributions have been in a positive vein. Some have expressed certain reservations and I want to deal with one or two of those. For example, there is some reservation regarding expansionist policies that might sometimes arise in the future. I wish to refer to a recent speech made by the President of the Federal Republic of Germany Richard Von Weizsächer at the dinner given in his honour by the President of the Republic of Poland, Mr. Wojciech in Warsaw on 2 May 1990. He said:
The central element of a European peace is the obligation of all nations never again to take up the accursed battle for borders and territories. We Germans are aware of what this means for us with regard to the Poles. Poland can be fully confident that the border issues between us are irrevocably resolved in substance and that they will be given the necessary contractual form, binding under international law, in the course of the Germany unification process. Polands' current western border will remain unaffected. We respect it and have no territorial claims  against Poland or any of our other neighbours now nor will we have any such claims at any time in the future.
The process of German unity is in keeping with a completely normal and human need for a nation that belongs together. Statesmanship from whatever side can only consist in guiding a natural process of this kind and making use of it for further objectives and cannot consider in hindering it. The European Community, which we are a member of, will develop more rapidly towards a political union than would have been the case without the German unification process.
There have been reservations expressed about the whole economic issues. I would like to remind the Senators that the Germans are not doing this on their own without being carefully monitored by nations outside the Community but, in particular, by the members of the European Community. The Foreign Ministers of the Twelve meet monthly and they are briefed by the Foreign Minister of the Republic of Germany. As the Minister for Foreign Affairs, Deputy Collins, said in reply to a question in the Dáil this morning:
Similar briefings are provided by German Ministers to their colleagues in other Councils, including in particular ECO/FIN and Agriculture. The special European Council held on 28 April considered the question of German unification and the informal General Affairs Council held in Dublin on 21 April 1990 to prepare for the special European Council considered inter alia a report drawn up by the Commission on the implications for the Community of German unification.
The whole emphasis from the Commission is that the integration will proceed by stages and it will require transitional measures to facilitate the gradual application of existing Community legislation.
Some Senators expressed concern  regarding the impact of unification on the budget of the EC. Figures, even those given by Mr. Delors, must at this stage by guestimates rather than estimates. The situation will be clarified when the arrangement for the Inter-governmental inter-German Monetary Union are finalised. I will again quote from what the Minister said this morning:
On the revenue side of the Community budget much will depend on the Commission's view, on the transitional arrangements and the macroeconomic impact of German unification. In general terms, the Commission expects to see vigorous economic growth in the GDR, generating higher demand throughout the Community and an increase in imports from other member states. This additional growth, which could add up to one half of 1 per cent of the Community GNP, will be reflected in additional revenue to the EC budget. On the expenditure side, the cost will largely be determined by the impact of integration on a Common Agricultural Policy and the scale of intervention under the Structural Funds.
The European Council said that the Community will ensure that the integration of the territory of the GDR is accomplished in a smooth and harmonious way. The heads of State and Government were satisfied that this integration would contribute to faster economic growth in the Community.
Some Senators expressed concern also that some of the events that occurred many years ago during the Second World War would reccur. Nobody can say that  they will or they will not, but the statements from every person in Germany at the present time, and for many years since the war, have said the opposite. In my opening speech on this motion, I referred to a statement made by Chancellor Kohl of the Federal Republic of Germany on 1 September 1989 on the occasion of the 50th anniversary of the beginning of World War II when he said:
We can take pride in our liberal constitution, in which we acknowledge the absolute precedence of human dignity in all areas of life, we reject war and force as a political tool.... and we are committed to the goal of a free and united Germany in a free and united Europe.
One of the Senators said it does not make a difference whether this motion is passed or not. We cannot stop the process even if we wanted to, which I presume we do not. It does make a difference. If I were a German, no matter how rich and powerful I was, I think I would be happy  to know that I had a small friend somewhere who agreed with me. I will finish by referring again to that speech by Chancellor Kohl which he made in September 1989 when he said:
We envisage a future in which the nations of the world are peacefully united in common freedom and we shall not relax our efforts to make that vision come true. Remembering 1 September 1939 we know that this is the most valuable legacy we can bequeath on coming generations.
If German unification can contribute in any way to peace, then I think we should support this. I believe that it will. I believe that it will draw together a nation of people who were separated unnecessarily and who, in future, will be a powerhouse of energy in the centre of Europe taking their place rightfully in the European community. I commend this motion to the House. I hope that it has the unanimous support of all the Members present.
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