Spaulding on Lutz, 'Siemens im Sowjetgeschäft: Eine Institutionengeschichte der deutsch-sowjetischen Beziehungen 1917–1933'

Martin Lutz
Robert Mark Spaulding

Martin Lutz. Siemens im Sowjetgeschäft: Eine Institutionengeschichte der deutsch-sowjetischen Beziehungen 1917–1933. Stuttgart: Franz Steiner Verlag, 2011. 391 pp. $89.00 (cloth), ISBN 978-3-515-09802-1.

Reviewed by Robert Mark Spaulding (University of North Carolina-Wilmington) Published on H-German (April, 2014) Commissioned by Chad Ross

New Approaches to Old Questions

This book is a composite of some new archival research and a good deal of theory-based discussion about what archival material can tell us. Investigations at the Siemens Archive and at the Russian State Economic Archive provide the empirical bases. In terms of space, theory has the upper hand, with three of the book's four main parts devoted primarily to discussion of the New Institutional Economics (NIE) and related social science analyses of actors, institutions, rationality, and choice. In the end, Martin Lutz's extensive application of these concepts and models does not produce any fundamental revision in our understanding of how Siemens or other large German corporations operated in the Soviet market.

Three chapters comprising the core of part 1 cover the "Problem," "Theoretical Framework," and the "Methodological Approach." They set the tone for the book by offering a lengthy recapitulation of the origins and development of NIE, "actor-centered institutionalism" (p. 45), and the degree of rationality expected from decision makers. Some readers will doubt the utility of the labels, concepts, and models unpacked in these pages. What is gained by re-labeling Siemens as a "transnational actor"? Do we need an extensively elaborated concept of "truly bounded rationality" to tell us that most people operate with less than perfect information about their environment? Even readers who trust in the value of these categories will agree that Lutz's exposition of these concepts over some seventy pages is far too lengthy. The discussion has the feel of a literature review that might be necessary in a dissertation, but which should have been cut or greatly compressed in this book. Further, many terms are repetitively reintroduced when they are employed again in parts 3 and 4.

Although Lutz claims that constructing his analytic model is not "an end in itself" (p. 67), the entire composition of the book indicates otherwise as the theoretical discussion overwhelms the empirical work, and the Siemens experience is always referred to as a "case study" (Fallstudie). At the several points where Lutz explains to readers what he's up to, his model-building or model-testing elements are always present. This is most evident in the conclusion (part 4), which contains a subsection on "Constructing Theory" (Theoriebildung) including six propositions to be used for "further theoretical developments along the lines of an institutional-economic approach." (p. 356).

Extraneous background information also plagues part 2, the 160-page narrative of Siemens' relationship with Soviet authorities in the years from 1917 to 1933. Most readers of a highly specialized study such as this will not benefit much from a four-page summary of "Stalin, the Collectivization of Agriculture, and the First Five Year Plan" or a three-page review of "Germany in the Great Depression" based on well-known works. This part of the book could have been more successful if Lutz had avoided discrete background discussions and instead had integrated the small amount of truly necessary contextual information more directly into the narrative of Siemens' activities.

Persevering readers will find some clear historical conclusions about Siemens and its business in the Soviet Union in the second half of part 4. Lutz sees Siemens pursuing a goal of "economic profit maximization" in the Soviet market (p. 359) and explicitly rejects the notion that Siemens followed larger political-economic strategies of "informal empire" or "economic imperialism" linked to a German grand strategy (p. 360). Somewhat paradoxically, he also endorses a primacy of politics over economics as the most basic motive for German economic relations with the Soviets. This is because business in the USSR was largely dependent on the financial mechanism of export credit guarantees granted by the German government to exporting firms such as Siemens. Lutz argues convincingly these credit guarantees were necessary to overcome the deep "mistrust" of the Soviet market and its institutions manifested by Siemens executives. At a later point Lutz argues that deep mistrust of the Soviets was probably widespread across the German business community. Lutz sees the credit guarantees arising from the Reich government's own foreign policy agenda and the place of the Soviet Union within those plans. Because German-Soviet economic cooperation was dependent on export credit guarantees which arose from the foreign policy strategy of the government in Berlin, Lutz sees politics rather than economics as the ultimate basis for Siemens business in the East. That is a reasonable interpretation, but one which should not be overdrawn. A close reading of the private sector and cabinet discussions surrounding the export credit guarantees of 1931, for example, shows that maintaining employment in Germany was no less important than maintaining good relations with the Soviets in moving the credits forward. Lutz himself concedes as much when he cites record high unemployment rates, employment policy, and the politics of reparations as the key motives for Chancellor Brüning's government to endorse an expansion of exports to the USSR.

It is regrettable that Lutz does not use the potential insights from the social sciences to advance the discussion beyond older interpretive dichotomies that were framed some thirty years ago: the debate over continuity or discontinuity in German foreign policy from imperial Germany to the Third Reich and the question of whether political strategies or economic gains were the more essential motivations in German foreign economic policy. If Lutz wants to justify the lengthy theoretical and methodological discussions included in this book, he will have to show that the theories and models on display can do more than contribute a bit of evidence here and there to one side or the other of these older debates. One might have hoped for more from a lengthy application of NIE and newer social scientific explanations of actors and institutions to this topic. The power of theory ought to lie as much in framing new questions as in helping to answer old ones.

Readers with an interest in behavioral explanations brought over from the social sciences and their use in a specific historical context populated by private sector and government actors with mixed motives of profit and ideology will enjoy this book. Those who doubt the usefulness of theoretical models of behavior as explanations for highly contingent historical actions will find their nerves frayed. Neither group will encounter fundamentally new questions or answers regarding German-Soviet economic relations in the Weimar era.

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Citation: Robert Mark Spaulding. Review of Lutz, Martin, Siemens im Sowjetgeschäft: Eine Institutionengeschichte der deutsch-sowjetischen Beziehungen 1917–1933. H-German, H-Net Reviews. April, 2014. URL:

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