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The Germans gets it wrong yet again.

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Iranian Economy Unwisely Helped by Germany

The Germans gets it wrong yet again.

Beginning with Bismarck’s creation of modern Germany, when it comes to moral choices and obligations to the rest of the world, Germany never seems to get it right: Taking a chunk out of France in 1870 to consolidate the Reich; blundering the world into the hecatombs of World War I; and, delivering a holocaust in World War II.

And now, yet again, by helping to sustain an Iranian regime attempting to acquire nuclear weapons. Even as Chancellor Merkel stands before Israel’s Knesset to tut tut her concern over the mullahs, Germany isn’t even taking the least costly steps to help keep Iran from achieving its nuclear ambitions.

Among the Western industrial powers, no country is more enthusiastic than Germany about trading with Iran and supplying it with the advanced goods crucial to its economy. Whether a German boycott of Iran would finally force Iran to respect demands for a shutdown of its nuclear efforts is unclear; what is clear is that without Germany adhering to tough sanctions there cannot be sufficient pressure on the Iranians to modify their behavior.
Germany is Iran’s second largest source of foreign goods and services. Iran imports close to $6 billiion worth annually, products that might otherwise be unavailable given that other advanced Western countries — most prominently the U.S. but also Britain and more recently France — are increasingly putting the squeeze on the Mullahocracy.

One might have thought that given Germany’s history it would also feel a special moral obligation to cut off trade with the modern Hitler in Teheran threatening the state of Israel. But a tin ear and alligator tears are another special German export.

Following the war, Germany made reparations to Holocaust survivors and continue to pay lip service to their regret for the horror of Nazism. In that they had no choice: it was the price of rejoining the international community following the War. But 60 years later, when there is no clear return for commercial and political circumspection they are unwilling to give up their lucrative trade with Iran.

While it is true that exports declined by 18% in the first half of ’07, they had increased from approximately $5B in ’04 to $5.7B in 2006. Still, this trade is a mere drop in the bucket of a multi-trillion dollar German economy that could easily be given up without ill effect to the economy as a whole, or to the vast majority of the something like 1,700 firms doing business with Iran.

Understandable reticence makes it a bit unclear precisely which German companies are selling to Iran; at very least among them are well known companies like Siemens; BASF; the civil engineering firm Bilfinger Berger; and Helm, the chemical concern. German companies sell such crucial technology as locomotives, gas turbines, and water purification and power generation equipment.

Perhaps more important, according to a recent article in the official German government publication, Deutsche Welle online, 75% of small- and mid-sized Iranian companies use German technology. But whether the products are banking services, huge turbines or the software for the cash register at a kabab joint, there is reason to believe that these are products without which the Iranian economy might suffer grievous damage.

Could a cynical and amoral Russia or China replace Germany as a supplier? Perhaps. But if so, they probably would have largely done so already: They are more congenial politically, prices would probably be lower and, most crucially, given increasing pressure on Germany to restrict trade, Russia and China offer better assurance of long term supply.

While there are a few hopeful signs such as decreased German government export credit guarantees and increasingly attenuated relations with German banks, members of the UN Security Council and Germany recently could only agree to extremely modest additional sanctions.

But harsher UN-endorsed sanctions might be unnecessary if the Germans finally did the right thing and observed the program increasingly adhered to by their allies. That is, if the Germans operated within the moral economy outlined in Merkel’s speech to the Knesset this past Tuesday. According to the Chancellor, “Especially in this place, I emphasize: Every German government and every chancellor before me was committed to the special responsibility Germany has for Israel’s security.” She went on to say that “This historic responsibility is part of my country’s fundamental policy. It means that for me, as a German chancellor, Israel’s security is non-negotiable.”

Apparently not. As recently as late last year the Chamber of Commerce of Darmstadt, a city in western Germany, sponsored a conference on German-Iranian trade. According to The New York Times, Rolf Weitowitz, a representative of the German Office for Foreign Trade, told exporters gathered to discuss “market opportunities” that Iran was eager to buy the kinds of capital goods in which Germany specializes.

The Chamber’s Deputy Director, Axel Scheer, was quoted in The Times as justifying the meeting as “an obligation to explain to German companies the risk of doing business there.” He went on to say that “We’re not trying to support weapons sales to Iran. This is not a political organization.”

The world hasn’t heard that much doubletalk since the last time Dominique de Villepin addressed the U.N. But de V. is a French annoyance, not a German problem. And German trade with Iran continues apace.

President Bush once said that if the Iranians develop nuclear weapons it may result in World War III. But even without the hat trick of responsibility for three World Wars, if the Germans don’t desist from the high tech trade that helps to maintain the Iranian economy, they may well end up morally responsible for helping the Iranian regime develop nuclear weapons — and tragically and ironically responsible for helping finish the work of destroying the Jews.

Now is the time for the Germans to finally do the right thing toward the civilized world that nurtures and protects them. And if once again they can’t get it right on their own, it should be up to the Western World — once again led by the United States — to force them to get it right.

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Written By

Douglas Stone is a Senior Fellow at the Center for Security Policy. He has a background in American and British 20th century political history, as well as Middle Eastern affairs.

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