Sheets of paper were invented a long, long time before anybody thought of envelopes. In the early days — and by “early days” I mean a couple of millennia ago — when some important official wrote a document that might, for example, grant its holder a special privilege of some sort, they would keep it at least somewhat confidential by folding it in half.
The Greeks had a word for such a piece of folded paper: a “diploma.” That word is still in use today. It kept its association with “official document,” but completely lost its original, literal sense of “folded in half.” There are plenty of diplomas floating around now, but nearly all of them are either kept nice and flat or neatly rolled up.
The word “diploma” is related to the English word “double,” and that seems to be where the “folded in half” business came from. But there’s another descendent of the “official” part of “diploma,” and that’s the word “diplomatic.” “Diplomatic” papers are, by definition, pretty official.
Around the late 1700s, Edmund Burke came up with a related word: “diplomacy.” It was introduced this way: “The only excuse for all our mendicant diplomacy is … that it has been founded on absolute necessity” (Burke did not mean “diplomacy” in a good way). That attitude toward diplomacy lingered on for a long time. The 1870 edition of Encyclopedia Brittanica suggest that “What we know of diplomacy was long regarded … partly as a kind of activity morally somewhat suspect”, and Sir Henry Wotton has been largely forgotten except for this one famous quotation: “An ambassador is an honest man sent to lie abroad for the good of his country.”
But there was a good sense of “diplomacy” as well: being tactful even when you’re saying something that’s not very pleasant. That meaning became common in the 20th century, as illustrated by Isaac Goldberg in the 1920s:
Diplomacy is to do and say
The nastiest thing in the nicest way.
And even today, diplomatic news often appears in newspapers — above the fold.
