page_title: Helmut Schmidt
section_title: Chancellor
hierarchical_section_title: Helmut Schmidt / Chancellor
caption_attribution_description: For documentary purposes the German Federal Archive often retained the original image captions, which may be erroneous, biased, obsolete or politically extreme. Bundeskanzler Helmut Schmidt und Ronald Reagan
context_page_description: Helmut Heinrich Waldemar Schmidt was a German politician and member of the Social Democratic Party of Germany, who served as Chancellor of the Federal Republic of Germany from 1974 to 1982.
  Before becoming Chancellor, he had served as Minister of Defence and as Minister of Finance. In the latter role he gained credit for his financial policies. He had also served briefly as Minister of Economics and as acting Foreign Minister. As Chancellor, he focused on international affairs, seeking "political unification of Europe in partnership with the United States" and issuing proposals that led to the NATO Double-Track Decision in 1979 to deploy US Pershing II missiles to Europe. He was an energetic diplomat who sought European co-operation and international economic co-ordination and was the leading force in creating the European Monetary System in 1978. He was re-elected chancellor in 1976 and 1980, but his coalition fell apart in 1982 with the switch by his coalition allies, the Free Democratic Party.
  He retired from Parliament in 1986, after clashing with the SPD's left wing, who opposed him on defence and economic issues.
context_section_description: Schmidt became Chancellor of West Germany on 16 May 1974, after Brandt's resignation in the wake of an espionage scandal. The worldwide economic recession was the main problem his administration faced, and Schmidt took a tough and disciplined line, in reduction of public spending. Schmidt was also active in improving relations with France. Together with the French President Valéry Giscard d'Estaing, he was one of the fathers of the world economic summits, the first of which assembled in 1975. In 1975, he was a signatory of the Helsinki Accords to create the Conference for Security and Co-operation in Europe, the precursor of today's OSCE. In 1978, he helped set up the European Monetary System (EMS), known as the "Snake in the Tunnel".
  He remained as Chancellor after the 1976 federal election, in coalition with the liberal Free Democratic Party (FDP). He adopted a tough, uncompromising line with the indigenous Red Army Faction (RAF) extremists. In October 1977, he ordered an anti-terrorist unit of Bundesgrenzschutz policemen to end the Palestinian terrorist hijacking of a Lufthansa aircraft named Landshut, staged to secure the release of imprisoned RAF leaders, after it landed in Mogadishu, Somalia. Three of the four kidnappers were killed during the assault on the plane, but all 86 passengers were rescued unharmed.
  Schmidt was re-elected as Chancellor in November 1980. Concerned about the Soviet invasion of Afghanistan, and the Soviet superiority regarding missiles in Central Europe, Schmidt issued proposals resulting in the NATO Double-Track Decision, concerning the deployment of medium-range nuclear missiles in Western Europe, should the Soviets not disarm. This decision was unpopular with the German public. A mass demonstration against the deployment mobilised 400,000 people in October 1981.
  At the beginning of his period as chancellor, Schmidt was a proponent of Keynesian economics, and pursued expansionary monetary and fiscal policies during his tenure. Between 1979-82, the Schmidt administration pursued such policies in an effort to reduce unemployment. These were moderately successful, as the fiscal measures introduced after 1977, with reductions in income and wealth taxes and an increase in the medium-term public investment programme, were estimated to have created 160,000 additional jobs in 1978–79, or 300,000 if additional public sector employment was included in the figure. The small reduction in the unemployment rate, however, was achieved at the cost of a larger budget deficit (which rose from 31.2 billion DM to 75.7 billion DM in 1981), brought about by fiscal expansion.
  During the 1970s, West Germany was able to weather the global financial storm far better than almost all the other developed countries, with unemployment and inflation kept at comparatively low levels. During the 1976 election campaign, the SPD/FDP coalition was able to win the battle of statistics, whether the figures related to employees' incomes, strikes, unemployment, growth, or public sector debts. Amongst other social improvements, old age pensions had been doubled between 1969–76, and unemployment benefits increased to 68% of previous earnings.
  Whilst visiting Saudi Arabia in April 1981, Schmidt made some unguarded remarks about the Israel-Palestine conflict that succeeded in aggravating the delicate relations between Israel and West Germany. Asked by a reporter about the moral aspect of German-Israeli relations, he stated that Israel was not in a position to criticise Germany due to its handling of Palestinians, and "That won't do. And in particular, it won't do for a German living in a divided nation and laying moral claim to the right of self-determination for the German people. One must then recognize the moral claim of the Palestinian people to the right of self-determination." On 3 May, Israeli Prime Minister Menachem Begin denounced Schmidt as "unprincipled, avaricious, heartless, and lacking in human feeling", and stated that he had "willingly served in the German armies that murdered millions." Begin was also upset over rema
caption: Schmidt with Ronald Reagan, Bonn, 30 November 1978
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