Preface for In the Nation’s Service

PREFACE

Without Reagan the cold war would not have ended, but without Shultz, Reagan would not have ended the cold war.

—MIKHAIL GORBACHEV¹

DEFTLY SOLVING CRITICAL BUT intractable national and global problems was the leitmotif of George Pratt Shultz’s life. No one at the highest levels of the US government did it better or with greater consequence in the last half of the twentieth century, often against withering resistance. His quiet, effective leadership altered the arc of history.

The Shultz model of public service seems almost quaint today, relying as it did on common sense, trust, a human touch, openness to new ideas and the muting of ideology, partisanship and histrionics. But it is actually quite relevant in our discordant day. While political, social and cultural dynamics have changed profoundly since Shultz served at the commanding heights of American power in the 1970s and 1980s, his legacy and the lessons of his career have enduring meaning as the nation and world seek to heal divisions and subdue the ruinous polarization of recent years. The example of George Shultz’s effective leadership can serve as a guide to creating a more temperate time, a return, if one is possible, to an era when patriotism is defined by what Americans can do together and individually to lift their country rather than demolish their opponents and silence opposing points of view.

Shultz represented a form of conservatism that has been all but erased in recent years by Trumpism and its acolytes in the Republican Party. The roots of Shultz’s conservatism can be found in Edmund Burke, Milton Friedman and the leadership of people such as Dwight Eisenhower, General George Marshall and Ronald Reagan, not the conspiracy theories of QAnon or the unruly passions of the mob that stormed the Capitol on January 6, 2021. Shultz developed a knack for solving the most difficult problems as a labor economist and business school dean and applied it successfully across two Republican presidencies. Tackling knotty problems in Washington is hard work. The capital runs on high-octane partisanship and one-upmanship. More so now than ever, but Washington was hardly a kumbaya town during the Nixon and Reagan administrations. Open-minded, even-handed pragmatists with a gentle touch rarely thrive or last long.

Shultz survived this tumult, joining an elite club as one of only two people in American history to hold four cabinet posts.² Despite the inhospitable Washington environment, he recorded historic achievements during the Nixon administration as labor secretary, budget director and treasury secretary. Applying his problem-solving acumen, he helped turn the unfulfilled promise of the landmark 1954 Supreme Court ruling, Brown v. Board of Education, toward reality by coaxing Southern states to desegregate public schools. He accelerated integration of the building trades and other unionized industries. Based on a Shultz design, Washington engineered changes in international monetary practices, scrapping the fixed exchange rate system between foreign currencies and the dollar that was codified in the 1944 Bretton Woods Agreement. Under the Shultz plan, foreign currencies were delinked from the value of the dollar and price of American gold reserves, in effect, establishing floating exchange rates, a system that continues to this day.

Shultz’s approach nearly fizzled during the Reagan presidency. He came to town in 1982 as secretary of state with a vision of easing cold war tensions and ran into a buzz saw of opposition among anti-Soviet ideologues in Reagan’s inner circle and the neglect of an inattentive president. For several years, he was adroitly outmaneuvered by rivals and bewildered by the disarray in the Reagan national security team. But he persisted. With a combination of determination, resilience, competitiveness, multiple resignation threats and an abiding faith that anything is possible when people come to trust one another, he slowly forged a remarkable partnership with President Reagan. Together they played a pivotal role in solving the biggest global problem of the second half of the twentieth century, the cold war. They did so in concert with two other men prepared to think outside cold war doctrinal boundaries, Mikhail Gorbachev, the Soviet leader, and his foreign minister, Eduard Shevardnadze.

In chronicling the end of the cold war, scholars and journalists have understandably concentrated on Reagan and Gorbachev and the critical, constructive endgame roles played by President George H. W. Bush and his secretary of state, James A. Baker III. Shultz received less credit and attention, partly because of his circumspection and his conviction that his role was primarily in service to Ronald Reagan. His modesty was admirable, if a tad feigned. It was also misleading. He deserves a great deal of credit. Once he gained Reagan’s trust with a vital assist from Nancy Reagan, Shultz helped Reagan act on his own genuine but muffled desire to improve relations with Moscow and reduce the danger of nuclear war. Shultz translated Reagan’s better instincts into practical policies and a productive diplomatic agenda with the Kremlin. In essence, he made it possible for Reagan to break free of the ideological warriors who surrounded him and his own belligerent anti-Soviet rhetoric. “I have always thought that letting Reagan be Reagan means a self-confident and positive approach,” Shultz said.³ In Gorbachev and Shevardnadze, Reagan and Shultz found negotiating partners motivated by a faltering Soviet economy, unsustainable defense spending and their own wish to wind down the cold war.

Shultz’s decisive role belies the proposition that Reagan came to power with a coherent vision of how to handle the Soviet Union and then brilliantly executed it. In this view, he skillfully combined combative rhetoric, muscular policies and large defense investments to coerce the Kremlin to the negotiating table and make concessions. Indeed, there were plenty of bombastic declarations, unyielding policies and a huge military buildup, all of which put pressure on the Kremlin. But by the fourth year of the Reagan presidency, there was little productive diplomacy in motion to capitalize on Reagan’s hard-line tactics. If Reagan had a clear vision in mind from the outset, he seemed incapable of moving beyond the intimidation phase until Shultz settled into his job, developed a diplomatic strategy and became America’s chief negotiator with the Kremlin.

National security documents, including detailed records of Shultz’s numerous negotiating sessions with Gorbachev and Shevardnadze, make clear how indispensable Shultz was. During hundreds of hours of talks with Shevardnadze and dozens of hours with Gorbachev from 1985 to 1989, Shultz dexterously guided the United States and Soviet Union toward agreements and understandings that resolved or eased many cold war conflicts. Reagan and Gorbachev operated in the limelight and got most of the credit, but Shultz and Shevardnadze made the progress possible through their tireless, patient work in the diplomatic trenches.

I first met George Shultz aboard a US Air Force plane in June 1983 on the opening leg of a flight from Washington to Manila. Not quite a year after becoming secretary of state, he was heading to a meeting of the Association of Southeast Asian Nations. I was in my fourth year as a Washington reporter for the New York Times, assigned to cover the Shultz trip after the newspaper’s chief diplomatic correspondent, Bernard Gwertzman, demurred to focus on other matters in the capital.

Shultz invited me to join him briefly in the secretary’s quarters at the front of the cabin as the plane cruised toward a refueling stop in Anchorage. He welcomed me aboard, exchanged pleasantries and introduced me to the small group of senior government officials traveling with him. Later in the flight, I joined half a dozen fellow reporters from the Washington Post, ABC News and other organizations for a thirty-minute airborne press conference with Shultz. I quickly discovered, as the veteran reporters aboard the plane had foreshadowed, that Shultz rarely made news in his interactions with journalists. Over the next week, I accompanied Shultz to the Philippines, Thailand, India and Pakistan. In a change of plans, he announced that instead of heading home for the Fourth of July, we were adding stops in Saudi Arabia, Lebanon, Syria, Israel and Egypt.

Over the next few years I intermittently covered Shultz while focusing my attention on American military and intelligence operations in Central America. On a multistop trip with him to Latin America in early 1984, he suggested I bring along my tennis racquet, and we spent a few hours playing singles one afternoon in Rio. His steady, unflashy tennis game was like the man himself. I could see that he was an embattled figure in the Reagan administration, often at odds with Caspar Weinberger, the secretary of defense; William Casey, the director of Central Intelligence; William Clark, the national security adviser; and a host of other officials who considered Shultz dangerously eager to temper Washington’s stormy relationship with Moscow.

In 1985, I relocated to the Times’ Moscow bureau, a spectacular vantage point to observe the twilight of the cold war, improbably engineered by none other than Ronald Reagan, working with Gorbachev. The two unlikely peacemakers were constantly attended and aided by their respective foreign ministers, Shultz and Shevardnadze. I chronicled the rapidly unfolding developments from Moscow, with side trips to European capitals and Washington, encountering Shultz at various places where he intersected with Gorbachev or Shevardnadze, including summit meetings in Iceland, Washington and Moscow. In January 1989, Reagan and Shultz exited government, and the cold war rapidly defrosted. Like others who covered the Reagan presidency, I was curious to understand why and how Ronald Reagan had flipped from anti-Communist crusader to diplomatic dealmaker with the Kremlin and what role Shultz played in that transformation.

So I was intrigued when Shultz inquired one day in 2010, when we were both based at Stanford, if I might be interested in writing his biography. As an inducement, he offered exclusive access to his papers, housed in a sealed archive at the Hoover Institution, where Shultz had set up shop when the Reagan presidency ended. After retiring from the Times in 2008, I had relocated to Stanford’s Center for International Security and Cooperation and was just starting work on a book about the joint effort of Shultz and four other cold war figures to abolish nuclear weapons. As I neared completion of the book a few years later, I agreed to tackle the Shultz biography.

By then, with some initial access granted by Shultz, I had discovered in the archive materials an insider account of Shultz’s first years as secretary of state. The voluminous diary, chronicled by Shultz’s first executive assistant, offered an unvarnished look at Shultz’s protracted struggle to overcome his opponents, a brutal brawl that matched, and at times exceeded, other postwar White House power struggles. The journal also described the hidden hand of Nancy Reagan as she reached out to assist Shultz in his tortuous effort to build a trusting relationship with an aloof Ronald Reagan. When I told Shultz I was ready to begin work, he instantly accepted my proviso about editorial independence: “It’s your life but my book.” He honored that understanding, never pressing me to bend the book to his liking.

By the time Shultz died on February 6, 2021, just weeks after he celebrated his centennial birthday, I had learned a great deal about him that I failed to divine in our early encounters nearly forty years earlier. The multidimensional Shultz I came to know was a protean figure who left an enduring mark on American and world history. A longtime Republican and vigorous free-market advocate, Shultz was exceptionally open-minded and guided by an uncommon degree of common sense. He was even-tempered and patient, sometimes to a fault. He shunned the limelight, listened intently to all comers and rarely rushed to judgment. His early background as a faculty member at the Massachusetts Institute of Technology and professor and dean at the University of Chicago were apparent in the careful way he weighed issues and time he devoted to reading history.

He could be prescient about the economic, social and political impact of new technologies and the long-term effects of changing demographics. Long before most national leaders understood that new information technologies were destined to alter their societies in fundamental ways, Shultz gave Gorbachev two unsolicited tutorials on the advent of a new information age and the threat it posed to insular governments. He recognized the coming of climate change and called for radical steps to combat it. In his last years, he frequently drew attention to the aging populations of Japan and China and explosive population growth in Africa as factors likely to alter the global economy in coming decades. In 2014, in words that foreshadowed the 2022 Russian invasion of Ukraine, Shultz seconded the analysis of a former State Department colleague who warned that Russian president Vladimir Putin was intent on dominating the newly independent states on Russia’s border that had once been part of the Soviet Union. To contend with Putin’s expansionist ambitions, Shultz said, “Americans will have to rise to the occasion by building a consensus, hard as that may be, around our own goals in a world awash in change.”⁴

Shultz had a gift for forging trusting relationships with people and then harnessing the rapport to address national and international challenges. “Trust is the coin of the realm,” he would often say. He tended meticulously to his working relationships with domestic and foreign leaders, dealing with small problems before they escalated into big problems, and maintained a constant stream of correspondence and gracious courtesy notes. He called it “diplomatic gardening.” As he said, “If you plant a garden and ignore it for six months, it’s taken over by weeds. But if you keep at it, month after month, then it grows. In diplomacy, the same thing is true.”⁵

All these traits formed the foundation for his problem-solving efforts. He added to the groundwork a simple but highly effective formula he developed: “As long as people are arguing about principle, you can’t get anywhere,” he liked to say. “If you can translate the disagreements into problems, people are pretty good at solving problems.” He managed large organizations inclusively and humanely, a rare practice in Washington. James Goodby, a veteran American ambassador, has never forgotten the day that he and Shultz stepped into the Oval Office to meet with President Reagan. In a show of respect to Goodby, Shultz guided him to the wingback chair next to the president, usually reserved for the most important guest.

After leaving government service in 1989, Shultz refocused his interest on nuclear threats, leading an inspiring campaign to abolish nuclear weapons and draw attention to nuclear dangers. It ultimately failed to make much headway toward eliminating the weapons. He also addressed climate change, sustainability, health care, federal entitlement programs and an array of other vital issues, tirelessly working these problems in a nonpartisan way right up to his death.

Donald Trump’s 2016 presidential campaign unsettled Shultz, but he wavered over whether to speak out. He eventually settled for a joint statement with Henry Kissinger in which the two former Republican secretaries of state said they would not endorse Trump or Hillary Clinton but would work to foster a bipartisan foreign policy. The written statement was unveiled in 2016 on the Friday before Labor Day weekend, guaranteeing it would receive scant media coverage.

Shultz grew increasingly alarmed as the Trump presidency unfolded but generally refrained from publicly rebuking Trump and a nativist Republican Party that was barely recognizable to him. The few exceptions were notable. In a February 2017 appearance at the Olympic Club in San Francisco, Shultz lamented Trump’s anti-immigration policies and quoted at length a Reagan speech celebrating the history of immigration in America. After Trump inexplicably defended and deferred to Vladimir Putin at a joint news conference with the Russian leader following their July 2018 meeting in Helsinki, Shultz sent word to journalists that he fully agreed with John McCain’s comment about Trump’s performance. McCain called it “one of the most disgraceful performances by an American president in memory. The damage inflicted by President Trump’s naiveté, egotism, false equivalence, and sympathy for autocrats is difficult to calculate. But it is clear that the summit in Helsinki was a tragic mistake.”⁶

Shortly before the 2020 election, Shultz criticized Trump’s management of foreign policy. “After nearly four years of an administration that seems to have assumed that American relations with the rest of the world is a zero-sum game and that the game is based largely on the personal relations between national leaders, distrust abounds internationally,” he wrote in an essay in the Foreign Service Journal. “The ability of the United States government to execute the president’s foreign policies has become severely limited by the lack of a clear and coherent method of formulating policy. The president’s use of social media to make frequent public reversals and revisions in policies has made the job of America’s diplomats exceptionally complex.”⁷

Sadly, Shultz did not publicly question Secretary of State Mike Pompeo’s failure to defend the foreign service and Marie Yovanovitch, the US ambassador in Ukraine, after she came under baseless fire in 2019 from Rudy Giuliani, Trump’s personal lawyer. At the time, Giuliani and Trump were trying to get Ukraine to investigate Joe Biden’s son, Hunter, for his dealings with a Ukrainian energy company. Ambassador Yovanovitch was abruptly recalled and her career effectively terminated by the State Department.

As the years passed, I discovered that Shultz loved a good party and was quick to sing and dance in private and public settings, even look ridiculous when the occasion called for it, as occurred a few years ago when he donned a Superman costume in a skit in the grand lobby at San Francisco City Hall, rescuing a woman in distress, played by his wife, Charlotte, who descended in a harness from the ceiling while pleading for help.

Yet for all his success and competence, Shultz sometimes struggled to command a room, to get his way, to stand up for principles that he considered paramount. At times, he seemed guileless. These patterns were rooted in a tendency to defer to his bosses, a powerful sense of loyalty and a belief that manipulative efforts to outmaneuver opponents were destructive to orderly decision-making. The dynamics led to a puzzling degree of inaction at critical junctures in his career. This was evident in his reluctance to leave the Nixon administration as the Watergate scandal engulfed the president and Shultz himself was drawn into an improper, White House–instigated tax investigation of Lawrence O’Brien, a Democratic Party leader, by the Internal Revenue Service (IRS). That episode is for the first time fully revealed in this book.

As secretary of state, he was unable for several years to cut through the opposition and force Reagan to reckon with a dysfunctional national security policy-making team. Shultz opposed the sale of American arms to Iran in exchange for the release of American hostages held by Iranian proxies in the Middle East, but for months he stopped short of insisting that the operation be ended. Over time, unbeknownst to Shultz, profits from the arms sales were illegally diverted to fund antigovernment insurgents in Nicaragua.

In recent years, Shultz defended Theranos, a Silicon Valley biomedical company, after his grandson, who was employed there, informed him that the firm’s widely touted claims about its blood-testing technology were exaggerated and deceptive. Shultz was enchanted with the company founder, Elizabeth Holmes, believed the new technology was a medical breakthrough and played a key role in drawing media attention and funding to the company. When Tyler Shultz came to his grandfather for help after Theranos threatened him with legal action for questioning its technology, George Shultz declined to disown Holmes. The episode sundered the Shultz family and shocked his friends. Shultz’s conduct may have been partly motivated by financial considerations. His holdings in Theranos stock were worth nearly fifty million dollars at peak valuation.⁸ On January 4, 2022, a federal jury convicted Holmes of wire fraud and conspiracy in her dealings with Theranos investors.⁹

Whatever Shultz’s shortcomings and blind spots, the historical record shows that he was certainly one of the most influential, accomplished and sensible American leaders as the nation traversed the tumultuous decades of the late twentieth century. Thomas Simons, who worked closely with Shultz at the State Department and served as an American diplomat for thirty-five years, said, “George Shultz is the most distinguished servant of the American state of the twentieth century.”¹⁰ Henry Kissinger, who doubted Shultz’s suitability to be secretary of state when nominated by Reagan in 1982, said some years ago, “If I could choose one American to whom I would entrust the nation’s fate in a crisis, it would be George Shultz.” About Shultz’s collaboration with Reagan, Kissinger noted, “His contribution, first of all, was to bring the sort of diffuse thinking of the Reagan administration into a coherent pattern and to establish a method of work. George translated the instincts of a man he admired into operational policy, and in a very steady and very thoughtful way.”¹¹ Colin Powell, Reagan’s last national security adviser, put it this way: “George was magnificent in his ability to understand the president. I admired Shultz not only for his intellectual powers, but for the way he determinedly managed to put substance into Ronald Reagan’s vision.”¹²

Robert Gates, a senior CIA official at the time and later defense secretary, questioned the wisdom of Shultz’s effort to warm up relations with the Kremlin, doubting the Soviet Union could fundamentally change. But he admired Shultz’s ability to act on Ronald Reagan’s inner impulse to tone down the cold war. Gates said, “Shultz, virtually alone in the administration’s senior foreign policy team, perceived that Ronald Reagan saw America’s resurgent military power and its challenge to Soviet assertiveness worldwide as a means to an end—to reduce nuclear weapons and, through a more constructive relationship, to take steps to promote a more peaceful world. When Reagan said these things publicly, most members of his own team, the press, and the public wrote it off as a political theater. Only Shultz seems to have grasped that Reagan was really serious and meant what he said.”¹³

Eduard Shevardnadze’s estimation of Shultz was more emotional. When I met him in Tbilisi in 2012, he was severely weakened by advanced Parkinson’s disease. After struggling to walk from his desk to a sofa with the help of two aides, he instructed his longtime assistant to give him a small stack of papers at the far end of the large office where he had served as president of the newly independent Republic of Georgia after the disintegration of the Soviet Union in 1991. After briefly studying the materials, he handed them to me. They were Christmas cards from George Shultz and his wife, Charlotte. “I saved them,” Shevardnadze said. “My friendship with George means so much to me.”¹⁴

Much has been written over the years about the end of the cold war. Don Oberdorfer, the late Washington Post diplomatic correspondent, published a fine account before the ravages of dementia felled him. Though we worked for rival newspapers, Don warmly welcomed me to the diplomatic beat in 1983 and generously helped me navigate the fast-paced travels of a secretary of state. Other works include a compelling firsthand account by Jack Matlock, who served at the White House and in Moscow during the Reagan presidency; deeply researched histories by John Lewis Gaddis, a Yale historian, and Robert Service, an Oxford scholar; and George Shultz’s own 1993 memoir, to name just a few.¹⁵ I learned a great deal from all and have tried in this biography to help fill out the emerging history. In recounting Shultz’s tenure as secretary of state, I have focused largely on his role in managing East-West relations, especially the Reagan administration’s handling of the Soviet Union.

This book is the story of how an unexceptional boy born in New York City and raised in Englewood, New Jersey, who showed few signs of greatness in school or college, became a molder of history, played a singular role in unwinding the cold war and set a lofty standard for public service.

Notes

1. Mikhail Gorbachev, interview by William Taubman, October 19, 2015.

2. The other was Elliot Richardson, who served as secretary of health, education, and welfare (January 24, 1970–January 29, 1973); secretary of defense (January 30, 1973–May 24, 1973); attorney general (May 25, 1973–October 20, 1973); and secretary of commerce (February 2, 1976–January 20, 1977).

3. “Memorandum from Secretary of State Shultz to President Reagan,” in Foreign Relations of the United States, 1981–1988, 5:347.

4. Goodby, “The Putin Doctrine and Preventive Diplomacy,” 23. Shultz made the comment in a preface to a journal article by James E. Goodby, a retired US ambassador and arms control negotiator. The article, which Shultz endorsed, described the threat presented by Putin’s view, or doctrine, that lands of the former Soviet Union constituted a sphere of Kremlin strategic interest.

5. Quotation from George Shultz according to Gerhard Casper, letter to the author, April 24, 2021.

6. Garchik, “George Shultz on Trump’s Talks in Finland.”

7. Shultz, “On Trust.”

8. Securities Exchange Commission, list of Theranos stockholders and number of shares each owned. Not a publicly available document. The author has a copy.

9. Griffith and Woo, “Elizabeth Holmes Is Found Guilty.”

10. Thomas Simons, interview by the author, May 19, 2009.

11. Henry Kissinger, interview by the author and Rebecca Hecht, November 14, 2014.

12. Colin Powell, interview by the author and Rebecca Hecht, October 1, 2015.

13. Gates, From the Shadows, 281.

14. Eduard Shevardnadze, interview by the author, July 27, 2012.

15. Gaddis, The Cold War and The United States and the End of the Cold War, among others; Matlock, Autopsy on an Empire; Oberdorfer, From the Cold War to a New Era; Service, The End of the Cold War.