Profile: The mark's new minder: Hans Tietmeyer tells John Eisenhammer that the Bundesbank needs a political perspective

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The Independent Online
HANS TIETMEYER enjoys arguing. He even considers it one of his hobbies. However since Friday, when he took over from Helmut Schlesinger as president of the Bundesbank, it is a hobby that he must curb - a victim of what the mandarins at the central bank call 'verbal discipline'.

There is no question, any more, of Mr Tietmeyer giving full play to his passion for speaking off the cuff. From now on he will be tied down by agreed texts and the authorised word. 'It's a great pity, because I am not one to keep my mouth shut,' he says, easing his imposing frame into a black leather armchair. 'But even the smallest adjective can have dramatic effects. One cannot be too careful.'

You mean, I ask, as in September last year when 'unauthorised remarks' from the Bundesbank unleashed the sterling crisis in the exchange rate mechanism? 'Forget it, just forget that,' he snaps, swatting his hand at the floor as if trying to beat off a pesky dog.

Among the unpleasant memories lingering on the 12th floor of the Bundesbank's headquarters in Frankfurt, the sterling crisis and the ensuing acrimony with London is perhaps the hardest to dismiss. As a result of those events, the corset of verbal discipline was certainly tightened a few notches.

It was not Mr Tietmeyer who made that fateful utterance on sterling in a newspaper interview, but the man he has just succeeded, Helmut Schlesinger. Whether intended or not, those remarks encapsulated the seemingly cultivated unworldliness of the 'Bundesbank man' - a type the donnish Mr Schlesinger personified. An apolitical theoretician, he was steeped in the rigorous ethos of the Bundesbank, which had been his world for nearly his entire working life. Outside of the central bank's own guiding principles, there were no countervailing priorities - just secondary concerns, afterthoughts.

But unlike his predecessor Mr Tietmeyer, at 62, is not a 'Bundesbank man'. Those 'afterthoughts' of the world of politics and international affairs formed the core of his experience. His background is not Frankfurt, but Bonn - the Economics and then the Finance Ministry - where for most of the 1980s he moved on the international financial stage and was Chancellor Helmut Kohl's sherpa at world summits.

No sooner was Mr Tietmeyer appointed to the directorate of the Bundesbank at the end of 1989 than he took leave of absence, called by Mr Kohl to negotiate monetary union between West and East Germany. The outcome could not have offered a more dramatic example of the limits to economic rigour in the face of overwhelming political pressure. To have asked Mr Schlesinger to perform that task would have been like suggesting that the Pope take six months off to run Caesar's Palace in Las Vegas. For Mr Tietmeyer it represented everything he had been trained to do as a negotiator in a wheeler-dealing political world. 'I did not like the result, and I said so at the time, but that is the point where the counsellor's role stops, and the politicians decide,' he says.

'There is a tendency here at the Bundesbank to see things as if standing back a few metres from daily affairs, from politics. It is a strength, but there can also be a certain arrogance in this - that one underestimates the difficulties of politics and the economic process. One must see this side of the coin as well,' he adds. 'What I bring to this job is a greater understanding of what politicians in Bonn or elsewhere have to take account of. When deciding on monetary policy, to know how politics is made is a comparative advantage.'

The criticism of his predecessor's lack of political awareness is muffled but audible. Mr Tietmeyer is also more openly pro-European than Mr Schlesinger was, which Germany's partners will no doubt appreciate. 'European politics is only successful when it is in the enlightened self-interest of all countries. One must see one's own interest and also those of other countries, and see the positive and negative consequences of actions. That is how I understand politics - not giving up one's own interests, but achieving a balance.'

He is reticent about his strong Roman Catholic faith, which underpins his 'commitment to try to make the world a better place, or at least not let it go to the dogs'. He says: 'My belief makes a difference, it orients me, but of course I cannot use it as a recipe for economic decisions.' He seems to throw this in as an afterthought, for fear Bundesbank-watchers might worry that interest rate decisions may soon owe more to the gospel than M3.

Neither does he talk much about what he does besides work, work, work - that he is a keen reader, an enthusiastic museum-goer, and much prefers to ride his bicycle than use his car when away on holiday. It is all to do, he says, with guarding against narrow-mindedness. 'I believe in going through life with my eyes and ears open, trying to understand what is going on around me.'

Mr Tietmeyer's greatest regret is that he was not able to spend time as a young man living abroad. 'In later years, I have travelled extensively and met most of the world's political and economic elite. But I miss what lies beneath the surface, the understanding of what really makes other peoples think the way they do and societies act the way they do.'

Mr Tietmeyer was born in 1931 in the village of Metelen in Westphalia, where his father worked for the local council. 'The village community in which I grew up strongly influenced me with its church-Catholic culture, mixed with a dose of Prussian discipline. In our family of 11 children, each one had to fight for his share, but also take account of others.'

At the Paulinus high school in Munster, master Tietmeyer was a good student and a great table tennis player. He twice won the national schools' cup, and went on to play for the German team. 'But I never really talk about this.'

At university, with a bursary from the Catholic Bishops' Student Fund, he began studying religion. Unlike two of his brothers, who went on to the priesthood, he switched after a year to the 'more interesting' subject of economics. 'To this day I stand by my Christian motivation, but over the years it became ever more clear to me that social commitment requires an economic basis.' He went on to study at Cologne University under Alfred Muller-Armack, the chief theoretician of the social market economy, who argued that social fairness is necessary for free markets to be sustainable in a democracy.

Mr Tietmeyer's first job was as director of the same Catholic Bishops' Student Fund that had helped finance his own studies. Then in 1962 he entered the Economics Ministry in Bonn as a junior assistant. Mr Tietmeyer, however, was never one to welcome the secure anonymity of public service. He describes his main characteristic as 'perseverance', but this does not capture the force of a man who is tough, ambitious and speaks his mind.

He steadily increased his reputation within the ministry so that by the 1970s he was already being talked about in Bonn political circles as an 'eminence grise'. The extent of his influence was dramatically revealed in 1982, when he played his part in the downfall of the Social Democrats under Helmut Schmidt, opening the door of government to Mr Kohl and the Christian Democrats. Mr Tietmeyer drafted the so-called Lambsdorff paper - named after Economics Minister, Otto Graf Lambsdorff, it was a clarion call for budgetary rigour, that warned that public spending was running out of control. The paper marked a watershed, as the centrist Free Democrats switched allegiance from the Social Democrats to the Christian Democrats. Mr Tietmeyer's hour had come. A card-carrying member of the CDU, he was promoted to state secretary at the Finance Ministry, in charge of international affairs.

It was a high-profile job, and he used it to the full. Already in 1985, he was being discussed as a possible successor to Karl Otto Pohl as president of the Bundesbank. But then Chancellor Kohl decided to let Mr Pohl stay on for another term. The growth of Mr Tietmeyer's influence and his proximity to power was highlighted in September 1988, when the 'Khaled Aker' terrorist commando of the Red Army Faction tried to assassinate him. Mr Tietmeyer survived the hail of bullets.

During the 1980s there were 'plenty of offers' to go into politics. So why did he not take them? 'It is very hard to say, because of course I can understand the thrill, the enjoyment. But I suppose it is because I know I would have had to make many compromises.'

In late 1989, when Mr Tietmeyer was nominated to the directorate of the Bundesbank, most people saw him as a Kohl man, an opinion reinforced when he almost immediately left again for Bonn to negotiate monetary union with the East. That is why Tietmeyer did not become president of the Bundesbank when, in the spring of 1991, Mr Pohl suddenly announced he was resigning.

Mr Tietmeyer's two years as vice-president and heir apparent allowed time to put sufficient distance between himself and Bonn. So is he such a good friend of Mr Kohl? 'Noooo,' replies the new guardian of central bank autonomy. 'We are not friends. I worked a lot for him, he trusts me to get things done. But there is nothing exclusive about our relationship.' He leans forward, warming to his theme. 'I know that 1994 is general election year, when the Bundesbank must be exceptionally careful not to take sides. Whoever expects help from me must wait in vain.' He pauses. 'Of course, that will not stop me from opening my mouth when I feel this is necessary.'

(Photograph omitted)

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