Choppy Waters Rock the Trans-Atlantic Relationship

EXECUTIVE SUMMARY

Each day in recent weeks has brought new evidence of troubles in the once stalwart “trans-Atlantic relationship,” the outdated misnomer for ties between Washington and its major Western European partners: Britain, France, Germany and more recently, the European Union. Disputes and slights – some real, some imagined – have led to speculation about a drift in a relationship that dominated (and indeed founded) most of the global institutions of the second half of the 20th century. While few see any evidence of an actual rivalry between the two sides, it’s possible that the combined damage to the relationship caused by the 2003 Iraq War and then the global financial crisis in 2008 has altered the way the major players view each other. In particular, hopes that maturing EU institutions could simplify this relationship so far remain unfulfilled. Ties between various individual European states and Washington vary greatly, with Poland and the Baltic states on the warm end and an increasingly disgruntled Turkey and bellicose Russia on the other.

The core of the relationship, of course, continues to reside in the power capitals – Paris and Berlin, London and Washington. Given the diverging economic, demographic and geostrategic outlooks involved, however, can the trans-Atlantic relationship still be reliably described with that comfortable old phrase, or has it evolved into a series of complex bilateral and multilateral conversations fated to wax and wane between partnership and rivalry?

Friendly Fire

More than a year into the Obama administration, nothing like the disdain that characterized Bush-era ties with Europe is present. Yet a host of disputes, resentments and misunderstandings have made both sides uneasy:

• A suspicion in Europe that the U.S. administration, in spite of its own center-left sympathies, is happy to see the EU’s business model come under strain due to the improvidence of some of its more socialist members (i.e., the “PIIGS”). Treasury Secretary Tim Geithner on March 11 issued the clearest signal yet that Washington does not agree with EU calls for curbs on hedge funds and private equity firms, which critics blame for exacerbating the EU’s sovereign debt crisis;
• Anger in Washington about Europe’s relatively small contribution to the Afghan war;
• The neutralization of Britain as a “bridge” between Europe and America, largely because British Prime Minister Gordon Brown, an “Atlanticist” himself, has felt compelled for domestic political reasons to distance himself from U.S. policy or risk renewed charges that Labour has been Washington’s “lapdog”;
• A sense of disappointment in Europe that President Obama has not brought the sea change in global affairs and U.S.-European ties that many there had expected;
• Anger in Brussels at Obama’s decision to cut the EU out of last minute dealings with China and other major players so that a minimalist deal on climate change could be salvaged at the otherwise moribund Copenhagen summit last December;
• Similar feelings when Obama unilaterally announced a series of banking regulatory reform proposals without coordinating with the G-20’s Financial Stability Board;
• Unhappiness in Washington at the tendency of Europe’s largest continental powers, Germany and France, to be deferential to Russia – in large part due to Moscow’s demonstrated willingness to use its energy resources for leverage. The sale of several large French warships to Russia earlier this year drove home poignantly the differing perspectives of Russia prevalent on the two sides of the Atlantic;
• A number of bilateral disputes involving individual countries, including Turkish fury over a U.S. congressional resolution on the Armenian genocide to Polish and Czech disappointment that the risky decisions to invite U.S. missile bases onto their territory have been for naught now that Obama has canceled those programs in deference to Russia;
• In general, European anxiety that China has displaced the EU as the focus of American global policymaking and that a “G-2” world is emerging with a diminished voice for Europe.

This last element – Europe’s fear of being marginalized in world affairs – has been fueled by a series of American decisions that, deliberately or not, feed a uniquely European gloom about the coming decades. Having adjusted their philosophical approach to the world to emphasize soft power, European policymakers must realize that in a world where their economic throw-weight diminishes, the soft approach risks eventual irrelevance.

“European elites are paralyzed by sight of a future they fear has been claimed by the U.S. and China,” wrote Phillip Stevens in his Financial Times column recently. “The postmodern view of geopolitics struggles to measure up against the rise of great powers in Asia, which put narrow national interests well ahead of wider mutual obligations.”

The inability of the U.S. and EU to forge a common approach in Copenhagen set the tone, but three far less serious tiffs have supercharged Europe’s suspicion that Washington has a waning interest in European opinion.

The first of these perceived slights was Obama’s announcement that he would forego the annual U.S.-EU summit scheduled for Madrid this May. While the decision might seem completely rational to anyone who has read the final communiqué of past such gatherings, feelings are fraught in Brussels, and the White House announcement touched off a spate of eulogies for the trans-Atlantic relations in European media. The U.S. has since backtracked somewhat, pledging a summit level meeting in the autumn.

Another spat, this time between the U.S. and Britain, involves the Falkland Islands – Las Malvinas in Argentine eyes. Argentina’s troubled government has been loudly complaining about British oil exploration in the island’s territorial waters lately, stirring memories of the 1982 war fought by the two nations. A furor erupted in Britain earlier this week when, answering a question from a British reporter, the State Department spokesman described the U.S. position on the centuries-old territorial dispute with a term British conservatives equate with treason: “neutrality.”

“Our position remains one of neutrality,” the spokesman said. “The U.S. recognizes de facto UK administration of the islands but takes no position on the sovereignty claims of either party.” A typical response in the British media, fond of references to the cultural and historical “Special Relationship” forged by Winston Churchill, came from the right-leaning military analyst Nile Gardiner in The Telegraph: "Thousands of British soldiers are laying their lives on the line alongside their American allies on the battlefields of Afghanistan. Yet the president of the United States is either unwilling or too timid to offer a single word of support for the British people, who face a mounting confrontation with a corrupt, populist Argentine government that is threatening a blockade of British territory."

Still another dispute has arisen as result of the convoluted nature of Pentagon procurement policies. After years of political wrangling, corruption and bid-rigging in the U.S., a European-American consortium (comprised of Northrop Grumman and Airbus-parent EADS) finally decided to drop out of a US$40 billion contract for airborne refueling tankers, conceding the ground to Boeing. The March 9 decision quickly brought claims of protectionism from the EU, with the European Commission saying it feared the “terms of tender were such as to inhibit open competition for the contract.” Airbus’ Chairman Thomas Enders made the same point somewhat less diplomatically.

Not All Bad

By and large, of course, U.S.-European ties remain exceptionally strong, particularly when measured in economic terms. The world’s largest economy and the world’s largest integrated trade bloc have suffered massively in the recent downturn, but the interconnected nature of U.S. and European corporate sectors, markets and transportation networks ensures no breach cuts too deep.

Analyses which dwell on “rifts,” meanwhile, will tend to overlook the positive developments – like the continued cooperation over Iranian nuclear proliferation and the developing joint U.S.-EU position on credit default swap regulation – and focus on the negatives.

It is also true that old definitions of the “trans-Atlantic relationship” fail to take into account the EU’s newer members, most of whom view the United States favorably (and many of whom put a good deal more faith in U.S. promises of “mutual defense” than anything emanating from the chancelleries of Paris, Berlin or London). In Central and Eastern Europe (CEE), the fear of an unpredictable Russia is directly proportionate to the devotion in Brussels to “soft power.”

Still, even here, some doubts have arisen. Russia’s war with Georgia in 2008 exposed the very limited recourse open to the U.S. or its allies in the former Soviet space. In seeking a “reset” of U.S.-Russian ties, largely to win Moscow’s aid in curbing Iran’s nuclear ambitions, Bush-era plans for a robust missile defense system in Poland and the Czech Republic were scrapped. So far, the concession has brought little in the way of support in international negotiations on Iran, yet has reinforced the insecurity of some EU/NATO nations – particularly the Baltic states.

Brussels Sprout

American policymakers, particularly those in the Democratic Party, have cheered moves to strengthen EU foreign policy and military institutions, arguing this would help reduce the cacophony of national opinions which make coordination on major policy issues difficult. (Republicans, to the contrary, have tended to view EU institutions with suspicion as rivals to NATO and captive instruments of the French foreign ministry). By and large, the rollout late last year of the new EU High Representative for Foreign Affairs and Security Policy, Britain’s Catherine Ashton, has been deeply disappointing in this regard. Since taking office, Ashton has found little appetite in the foreign ministries of the EU’s major powers for ceding ground to the center. She has struggled against conflicting bureaucratic and national demands to make the 5,000-strong European diplomatic service a reality and has been criticized by member states for everything from inexperience to being upstaged by U.S. Secretary of State Hillary Clinton on Haiti relief. Her involvement in perhaps the most sensitive issue of all between the U.S. and Europe – the mission in Afghanistan – is minimal since the mission there is run by NATO.

Ashton has argued that EU member states need to put aside squabbling and help her coordinate the trade bloc’s international message or face dwindling influence in the world. On March 10, speaking to the European Parliament, Ashton said that India, China and other rising powers would not wait for Europe to get its act together in foreign affairs. “If we pull together we can safeguard our interests,” she said. “If not, others will make the decisions for us. It's that simple."

That Island Nation

Taken on the whole, even with the list of grievances growing weekly between them, it could be argued that ties between the U.S. and Europe’s major continental powers – Germany, France and Italy – are less agitated today than at any time in recent memory. Afghanistan aside, efforts to coordinate responses to global flashpoints – the quakes in Haiti and Chile, Niger’s recent coup, the summer’s unrest in China’s Muslim region of Xinjiang – all were notable for the consensus across the Atlantic.

Britain, however, stands out as an exception. Harder hit economically by the downturn and in the throes of a general election year, the Labour government has been loath to play to role in geopolitics that British leaders since Margaret Thatcher have sought: Europe’s agent to America, and America’s translator for the continent. In part, the reluctance stems from the spectacular failure – in the eyes of most British voters – of Tony Blair’s efforts to put that dynamic to work ahead of the Iraq War in 2003. Brown’s government faces a Conservative opponent with a lead in the polls who ceaselessly hammers home the consequences of such “kow-towing” to Washington.

The so-called “Special Relationship” enjoyed a late-life surge in the U.S. during the early days of the Iraq War but has since dropped once more from American usage. In fact, U.S.-British ties have been deeply strained over a range of issues – the Falkland Islands spat being only the silliest. Under severe political pressure, the Brown government has railed against U.S. treatment of terrorist suspects, inaction (and pro-Israeli favoritism) in the Middle East peace process, drone missile attacks and resulting civilian casualties in Pakistan and, in Washington, a lingering anger that Britain’s Financial Services Authority prevented a last-minute rescue of Lehman Bros. by Barclays in 2008 (however poorly organized the idea was by U.S. officials).

The Conservatives, once the standard-bearers of this relationship, show no interest in picking up that flag if they defeat Labour in upcoming elections. Douglas Hague, the senior Tory official on foreign affairs, said on March 11 Labour had been slow to recognize the sea change in global geopolitics. He said Britain had to “acknowledge that a vast proportion of the world's economic activity, followed inevitably by its political weight, has moved in recent decades beyond the confines of Europe and North America.

This tension has real-world implications. Britain’s storied talent for applying diplomatic putty to the cracks in U.S.-European affairs has been exhausted, its politics making such efforts painful to its government, and the rest of the EU a good deal less susceptible to its charms than in the days when the Anglo-American model was all the rage. U.S.-British ties will continue to drift at least until the next government is seated, and while politics may be dictating what both sides say about Washington at the moment, there is not much in current British political discourse to suggest London is ready to resume its role as trans-Atlantic interlocutor.

Toil and Trouble

The mutual interests that encourage high-level policy coordination between Europe and the U.S. (as well as Japan, Canada, New Zealand, Australia and any number of other like-minded states) are at no risk of disappearing. At any given time over the past five decades, one or another of the bilateral relationships that exist under the “trans-Atlantic” umbrella were dysfunctional – U.S. disagreements with France and Germany in the run up to the Iraq War in 2003 stand out as a prominent recent example. By and large, the broader strategic value of what used to be called the North Atlantic Community remains great, though its primacy is waning. Economically, politically and even culturally, Europe and North America writ large continue to judge the occasional diplomatic annoyances and tiffs at the margins to be well worth bearing.

But this rested largely on the logic of a world whose agenda was shaped predominantly by the G-7. Now, it is clear both sides have started to recalibrate the value of the old trans-Atlantic link in light of a very different world. For Europe, a debate is beginning over its future role and influence in the world, with some suggesting the EU should carve out a larger version of the “bridging” role Britain played for years, harnessing America’s power for Europe’s interests; most appear to prefer to stay the “soft power” course, steering clear of the big policy fights (with Russia over Georgia, China over Taiwan, Cuba over human rights) that Washington still pursues.

For the United States, Europe will likely remain a valued diplomatic partner, even if its diplomatic relevance is increasingly based on the UN Security Council vetoes apportioned out to it in the U.S.-designed international architecture of 1945. Even with those cards, Europe’s word in Washington does not carry the weight it did as recently as the late 1990s, and the irresistible temptation to downgrade relations in favor of Asia will get more rather than less obvious. The U.S. calculation in this regard appears to be simple: In the 21st Century as it is currently unfolding, Europe needs us more than we need Europe. So let Europe adjust.

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