Participants' Reports
Beyond Iraq: Picking Up the Pieces of the Transatlantic Relationship
by
Daniel Hamilton
Richard von Weizsäcker Professor
Director, Center for Transatlantic Relations, Johns Hopkins SAIS
Thank you very much for asking me to join you today. I was asked to speak about transatlantic relations after Iraq. We might start by recognizing that whereas Iraq may have ignited a huge transatlantic brawl over the past year, differences on that issue alone do not explain the emotional or broad-based nature of transatlantic recrimination and bitterness. In my view that is because much of the transatlantic debate has been less about Iraq per se and more about what our respective approaches to Iraq may say about our future behavior toward each other and to the new century’s challenges.
Iraq is perhaps the most visible and emotional issue in a period of transformation and redefinition of transatlantic relations not unlike the 1940s and early 1950s. And in this debate, personalities, policies, catalytic events, and deeper structural changes all play a role. I don’t want to spend much time on the gratuitous insults and cartoon images, the self-righteous triumphalism or the hollow posturing, except to say that style and tone matter, and it should give us pause to see the eagerness with which so many on each side of the Atlantic have been willing to sweep away facts and interests for the sake of a good stereotype.
In a certain sense, of course, these caricatures are important, because one’s view of one’s partner is in large part derived from one’s view of oneself. Das Bild vom Partner hängt vom Selbstbild ab. And since Europeans and Americans are each presently engaged in a rather fluid debate about the future direction of their roles in the world, each of us may in fact come to view the other in a new light.
Current transatlantic disputes are well known and do not bear repeating here. In and of themselves, in fact, such transatlantic squabbles are nothing new. But increasingly, these disputes are being viewed through different foreign policy lenses, each framed by a separate catalytic event. For most Europeans the catalytic event framing much of their foreign and security policies remains the fall of the Berlin Wall on November 9, 1989 and the accompanying collapse of the Soviet Union and European communism. When the people on the streets of central and eastern Europe brought down the Iron Curtain with their collective cry, “We want to return to Europe,” they unleashed an earthquake that is still shaking the continent and its institutions. It has given Europeans an historic opportunity to build a continent that is truly whole, free and at peace with itself. It is a goal that Americans share, and today it is truly within our grasp. Understandably, such a project continues to absorb, almost overwhelm, European energy and attention.
For most Americans November 9 also played a catalytic role, and informed much of U.S. foreign policy in the ensuing decade. This school is proud to have a piece of the Berlin Wall in our courtyard. But in American public consciousness the horrific events of September 11, 2001 have transformed November 9, 1989 into a bookend to an era of transition to a new and newly dangerous century. September 11 has unleashed a very fundamental debate about the nature and purpose of America’s role in the world.
In many ways, the current debate is analogous to the period of the late 1940’s, when America had won a war but not defined its postwar role. In that period, the notion of containment emerged as an organizing principle for American foreign policy. In many ways, the events of November 9, 1989 represented the logical conclusion to that policy. Today, the debate is how the threat of terrorism joined to the proliferation of weapons of mass destruction should lead the U.S. to reframe its foreign and security policies. In such an open debate, some basic propositions – mainstays of U.S. foreign policy for 60 years -- are being reexamined. And here some differences with the containment debate of the late 1940s are instructive for transatlantic relations.
Then, Americans believed that one part of Europe was the front line and another part of Europe posed grave dangers. As a consequence, the core of U.S. foreign policy was rooted in European stability. Today, Americans believe they themselves are on the front line, and the danger emanates from beyond Europe. Europe, as a consequence, having already been “won,” is increasingly taken for granted, and seen increasingly by some more as a platform than a partner in a new global campaign.
These lenses become important as we confront the future.
November 9 was a day of promise, of new possibilities. September 11 was a day of tragedy, of new dangers.
The November 9th perspective says the worst is over. The September 11 perspective says the worst is yet to come.
As each of our debates proceeds, there is a temptation to use the other – or more typically, a stereotype of the other -- as an instrument with which to bash one’s opponents and to advance one’s own particular point of view. Our common challenge is to resist that lazy temptation and to try to see through both lenses, to reconcile the promise offered by November 9 with the challenges posed by September 11 – to reconcile Europe’s grand experiment of integration with a reorientation and strategic transformation of transatlantic relations to create a new model, and a new focus, for our partnership.
Taken together, November 9 and September 11 convey a single message. We should trade in our old transatlantic barometer, which measured the health of our partnership by the degree of U.S. engagement on the European continent, for a new measuring stick, which gauges the ability of the United States and Europe to cope – together -- with the promises and dangers of globalization. If the fall of the Berlin Wall was the triumph of globalization’s positive elements, the fall of the World Trade Tower was the shuddering response by its darker forces. Seen in this way, November 9 and September 11 convey both opportunity and obligation to recast our partnership, and with it the international system.
The greatest security threats to the U.S. and Europe today stem from problems that defy borders and ignore national sovereignty: terrorism and proliferation of weapons of mass destruction, pandemics and environmental scarcities.
They stem from challenges that have traditionally been marginal but contentious in the transatlantic security dialogue: "out-of-area" peacekeeping; post-conflict reconstruction and rehabilitation; rogue states, failed states and states hijacked by groups or networks.
And they come from places that the transatlantic agenda has often ignored: Africa, Southwest and Central Asia.
These difficulties lead some to ask, why even bother? Given current power disparities and differences in strategic approach, why not just go our own ways?
The simple answer is that we can’t afford it. A weaker transatlantic bond would render Americans and Europeans less safe, less prosperous, less free, and less able to advance either our ideals or our interests in the wider world.
Few great goals in this world can be reached without America, but few can be reached by America alone. The American people are unlikely to sustain an approach to the world that makes every problem our problem and then sends our warriors to conduct our foreign policy. In this era of shadowy networks and bioterrorists, failed states and recession, the only way we can share our burdens, extend our influence, and achieve our goals will often be by banding together with others, particularly our core allies.
Europe also cannot afford transatlantic divorce. Efforts to go it alone would more likely split Europeans than unite them; if EU members were forced to choose between their incomplete European foreign and security project and alliance with the U.S., most would choose the latter. Europe would also lose its voice in the US debate, and thus abdicate their ability to influence the world’s only superpower. Finally, Europe has yet to translate its considerable political and economic weight into strategic power; it remains hampered by its lack of military clout, its highly inefficient way of decision-making, and the absence of any real ambition to play a strategic role. In some distant future the Union may become an effective strategic player, but even then it is still likely to share more interests than differences with the United States.
These are false choices. Our real choice must be to develop a complementary sense of risk and responsibility that aligns our respective strengths (and minimizes our respective weaknesses) to respond to the challenges that face us. In the post-post Cold War world, the relationship between the United States and Europe remains distinctive in this one sense: When we agree, we are the core of any effective global coalition. When we disagree, no global coalition is likely to be effective.
More than with any other part of the world, America’s relationship with Europe is what one might call an enabling or empowering relationship. When it works it enables each of us to achieve goals together that neither of us could alone. The Bush Administration put this premise to the test in Iraq, and the situation on the ground is a mess. The EU put this premise to the test on climate change, and the result is a climate regime in disarray.
It is decidedly in American interests to seek a more effective global partnership with a Europe that can act in real-time on pressing international matters. We must develop ways to work better together in fast-breaking crises; manage our differences before they impair our ability to cooperate; and improve joint efforts to address emerging threats and global issues.
Are we ready for such a partnership? Will Americans have either the patience or the inclination, and will Europeans have either the capacity or the will, to generate the coherence of action that will be required? These are open questions that will test leadership on both sides of the Atlantic. Our most immediate task, of course, is reaching agreement on the role of the international community in Iraq. This certainly will be difficult and contentious. But we must also frame our continuing debate over Iraq with a wider perspective if we are to pick up the pieces of our broader relationship. Let me suggest briefly a few other areas of endeavor.
Winning Peace As Well as War
The first is to enable ourselves to win peace as well as war. “The most pressing foreign policy problem we face,” Tony Blair said in Chicago in 1999, “is to identify the circumstances in which we should get actively involved in other people's conflicts.”
It is perhaps useful to recall Blair’s statement at this time, since transatlantic tensions over Iraq have diverted attention from what may be a more significant, longer-term phenomenon: that Europeans as well as Americans have been engaged increasingly -- and often together -- in “out of area” interventions since the end of the Cold War. In fact, the number of interventions has grown almost as fast as the number of reasons given for them.
Initial post-Cold War interventions, made against the backdrop of the peaceful revolutions of eastern Europe and debates about the “end of history,” were justified largely in the name of humanitarian ideals. Some were authorized by the Security Council, some were not. Since September 11, such motivations have been supplemented by a harder-edged view that internal chaos, civil war or failing states are not simply an offense to Western ideals or moral sensibilities; they can become the seedbed for forces that seek to destroy western-led global order.
Even the debate about the role of international law and the role of the UN in authorizing force has not questioned what at its core is a growing acceptance throughout the West that the sovereign rights of a state may be breached in order to protect against widespread and severe human suffering or deprivation of human rights.
Despite much internal wrangling, the Europeans have committed themselves to such efforts. There are more European than American forces engaged in the Balkans and in Afghanistan and the Congo is a European operation. According to GMF-sponsored polling, Europeans are more willing than Americans to use force in order to end civil wars. The Europeans themselves engaged in Kosovo without an explicit authorization from the UN.
One could go so far as to argue that the inner-western dispute over Iraq was so heated because the US and UK operated outside the bounds of western consensus, not outside the bounds of the UN.
The world is riddled with potential Afghanistans or Rwandas. We will face more situations like Kosovo or Iraq. Each will have its own unique circumstances; there is no one-size-fits-all strategy. The problem is that despite more than a decade of recent experience, U.S. and European capacities to win peace as well as war and peace remain woefully inadequate.
The corollary is that each partner also commits to address its particular weakness. This means, as matters of priority, more effective European military capabilities and more effective U.S. pre- and post-conflict capabilities.
There is a good deal of work to do on each side of the Atlantic. The U.S. is fundamentally reshaping its military doctrine without similarly improving its ability to prevent conflicts or to stabilize and transform post-conflict environments. There is a whopping imbalance in budgetary priorities: close to $400 billion is allocated for defense but only about $15 billion for civilian aspects of international crisis management. Current mechanisms for international crisis management are a legacy from the Cold War. They are outdated and not suited to addressing the complex set of challenges created by failed states.
All too often the military becomes the “stuckee,” the force that gets stuck with a broad range of non-military challenges. Moreover, since the Pentagon has strongly resisted any systematic effort to integrate such tasks into its strategic culture, the response to crises is often ad hocism, reluctance to commit energy and resources, and excessive focus on exit strategies. This situation, in turn, is further exacerbated by our society’s congenital Attention Deficit Disorder when it comes to foreign policy. It is striking how quickly the attention of the media, the public and the Congress shift after a conflict is over, leaving large questions about the sustainability of support for American engagement in post-conflict situations.
The result has been schizophrenic engagements in Haiti, Somalia, Bosnia, Kosovo and Afghanistan. The imbalance between our robust ability to wage and win war and our feeble facility to secure the peace afterwards threatens to undermine our security goals. The U.S. must equip itself with a broad-ranging set of instruments that would allow it more effectively to wage peace as well as war.
Europe’s problem has often been the mirror image. On the one hand, the EU has advanced a more comprehensive concept for crisis management that includes both civilian and military means and puts particular emphasis on crisis prevention. This broader concept enables the EU to address situations with a full range of political, civilian, non-governmental and economic instruments that NATO, as a military organization, cannot match. The EU’s “civilian” Headline Goals, little noticed in the U.S., provide for new capacities in policing, the rule of law, civil administration and civil protection, to enhance European capability to field teams that can provide comprehensive and integrated security support, especially in the aftermath of conflict. This broader approach to security, if sustained and strengthened, can provide the EU with a range of useful peace-winning tools.
The problem remains Europe’s uneven capacity for robust or sustained military engagement “out of area.” The Headline Goal process has revealed significant deficiencies in such areas as strategic and tactical mobility, sustainability, all-weather precision strike, command, control, communications and intelligence. Forty main categories of shortfalls were identified in the European Capability Action Plan – a plan that responds more to past needs than future challenges.
While the EU has committed to close these gaps, and some member states have bolstered their defense spending, as a whole the EU has not yet put its money where its mouth is. Even those Americans who support ESDP’s potential are concerned that European force commitments and capability pledges are often little more than empty exercises in European self-assertion.
The results of our uneven approaches to these challenges are apparent in the tenuous post-conflict situations in both Afghanistan and Iraq.
The question is how North America and Europe can best leverage our respective strengths, and rectify our respective weaknesses, to improve international action.
In many post-conflict environments often the most important security challenge is providing civil protection and security. This is a job for police, not soldiers or civilians. The U.S. should take a page out of the EU’s book by establishing and funding a volunteer reserve police unit of 3,000 personnel, capable of integrated operations with Multinational Special Units of the type employed in the Balkans and capable of executing security tasks such as control of belligerent groups, crowd control, apprehension of targeted persons and groups, and support to police investigations and anti-corruption tasks.
The U.S. should also create a robust civilian rapid response capacity, perhaps organized under the Agency for International Development (AID) and modeled on the Federal Emergency Management Agency (FEMA), which could mobilize U.S. experts for international post-conflict reconstruction and rehabilitation efforts on a more systematic basis.
The NATO Response Force initiative, while welcome, has not been flanked by similar efforts to improve joint or complementary U.S. and European capacity to execute post-conflict security tasks. We are only working on one half of the puzzle. We should create an integrated, multinational security support component that would organize, train and equip selected U.S., Canadian and European units -- civilian and military -- for a variety of post-conflict operations. These units should be designed flexibly to support operations by NATO, NATO and Partners, the EU, and the UN.
The Marshall Center in Garmisch has proven to be a useful training ground for military officials from across the Partnership for Peace. We have no equivalent for post-conflict reconstruction and rehabilitation operations. Since the EU plays an important role in this area, consideration should be given to an international training center for post-conflict reconstruction operations, supported jointly by the U.S. and the EU.
ESDP must enter a new phase. The original Petersberg tasks, while broad and vague enough incorporate the full spectrum of military activity, focused on stabilizing the periphery of an increasingly stable Europe. Today, it should equip Europeans to act far beyond their continent. Originally, ESDP was intended to make Europeans marginally more effective at policing their backyard. Today, it should be adapted to defend European societies from terrorists with WMD, failed states or aggressive dictators in regions far from the European homeland. Originally, ESDP was intended to prevent future Bosnias. Today, it must be adapted to prevent future Afghanistans – or Iraqs.
This, in turn, requires synergy between ESDP and NATO’s Response Force initiative. If managed well, both could serve as agents for reform of European forces within a broader “transatlantic transformation” process, particularly since both projects draw essentially on the same set of forces. Moreover, since most EU capability shortfalls are also addressed by the Prague Summit’s capability commitments, any action taken by individual European nations to remedy their shortfalls will contribute to both ESDP and NRF. U.S. and European forces might be able to “bypass” the transatlantic capabilities gap by integrating European forces into the key training and conceptual revolutions associated with U.S. force transformation. The U.S. also needs partners in transformation, since much of transformation is about networking knowledge, developing better assessments, and drawing on collective expertise. If the relationship between ESDP and NRF is managed badly, however, this could lead to a mutually destructive spiral that would accelerate transatlantic divergence of standards, training, and threat assessments guiding force planning and development.
Transatlantic Homeland Security
A second, related initiative should be to develop “transatlantic” approaches to homeland security or societal protection. When the United States was attacked, hundreds of Europeans were killed. Our allies immediately invoked the North Atlantic Treaty’s mutual defense clause, in essence stating that the September 11 attack was an attack on a common security space -- a common “homeland.” It is unlikely that a successful effort to strengthen homeland security can be conducted in isolation from one’s allies. The US may be a primary target for al Qaida, but we know it has also planned major operations in Europe. In fact, as my friend Simon Serfaty has noted, this age of catastrophic terrorism is an assault on the very idea of Europe – that is, an historic effort by the survivors of war, in the aftermath of war, to work together to prevent mass human tragedy from happening again.
Similarly. a terrorist WMD attack on Europe would immediately affect American civilians, American forces, and American interests. If such an attack involved contagious disease, it could threaten the American homeland itself in a matter of hours. The SARS epidemic, while deadly, is simply a “mild” portent of what may be to come. In the aftermath of the Sept. 11th attacks, it has become very clear that controlling borders, operating ports, or managing airports and train stations in the age of globalization involves a delicate balance of identifying and intercepting weapons and terrorists without excessively hindering trade, legal migration, travel and tourism upon which European and American prosperity depend. Efforts to protect the U.S. homeland against cyberattacks, for example, can hardly be conducted in isolation from key allies whose economies and information networks are so intertwined with ours. This is an area ripe for breaking new cooperative ground between police and law enforcement officials, intelligence and financial authorities and many traditional domestic agencies.
It is an area in which US-EU cooperation has advanced deeper European integration, particularly in such areas as judicial cooperation, transportation security, health security.
Transformation of the Greater Middle East
Third, we must go beyond Iraq to consider comprehensive transatlantic strategies towards the greater Middle East. A circle – with its center in Tehran – that has a diameter roughly matching the length of the continental United States covers a region that encompasses 75 percent of the world’s population, 60 percent of its GNP, and 75 percent of its energy resources. Greater Southwest Asia is the region of the world where unsettled relationships, religious and territorial conflicts, fragile regimes, and deadly combinations of technology and terror brew and bubble on top of one vast, relatively contiguous energy field upon which Western prosperity depends.
The main threat to German, European, American security is no longer invasion across the Fulda Gap but rather wanton destruction of our societies or irretrievable damage to our extended interests generated by turmoil in this region.
Choices made there could determine the shape of the 21st century – whether weapons of mass destruction will be unleashed upon mass populations; whether the oil and gas fields of the Caucasus and Central Asia will become reliable sources of energy; whether the opium harvests of death in Afghanistan and Burma are shut down; whether Russia’s borderlands will become stable and secure democracies; whether Israel and its neighbors can live together in peace; and whether the great religions of the world can work together.
In the past, we have approached this region through a series of policy boxes – the Middle East peace process was treated separately from the issues of energy, which were treated separately from concerns about proliferation, which were treated separately from approaches to North Africa, which were treated separately from our approaches to Iran and Iraq. Globalization has erased these lines, and despite the contentions of some, neither the United States nor Europe can manage these challenges on its own. We must devise a new transatlantic strategy to this region that is more than a series of compartmentalized policies.
This is a long term effort. We cannot hope to transform this turbulent region into an area of democratic stability and prosperity anytime soon. But we can act more successfully together to defend common interests, to dampen the negative trends that are gaining momentum, to work with those in the region who seek to carve out areas of civil society where the totalitarian state does not intrude, to control crises—and if need be, to win wars.
New Models of Transatlantic Governance
Finally, we should be working more creatively to develop new models of transatlantic governance. While our pundits tell us that Europeans and Americans are drifting apart, the facts tell a different story. Almost every single indicator of societal interaction -- whether flows of money, services, investments, people or ideas -- underscores a startling fact: our societies are not drifting, they are colliding. The decade of the 1990s – the decade when the supposed “glue” of the Cold War dissolved – was one of the most intense periods of transatlantic integration in history. If one uses Tom Friedman’s definition of globalization as farther, faster, deeper and cheaper integration at inter-continental distances, then it is advancing farthest, fastest, deepest and cheapest between the continents of Europe and North America.
Consider a few facts. Our companies invest more in each other’s economies than they do in the entire rest of the world put together. More than twelve and a half million Americans and Europeans owe their livelihoods directly to the $2.5 trillion economic relationship - the world's largest. Despite the rhetorical flourishes one hears about shifting American priorities due to NAFTA or the “Asian century,” over the past eight years American investment in the tiny Netherlands alone was twice what it was in Mexico and 10 times what it was in China.
Europe, not Asia or Latin America, is the most profitable place in the world for American companies, Presently, U.S. companies rely on Europe for over half their total annual foreign profits.
America’s asset base in the UK alone is roughly equivalent to the combined overseas affiliate asset base of Asia, Latin America, Africa and the Middle East.
Two-thirds of American corporate international R&D is in Europe, and two-thirds of the world’s industrial R&D in concentrated in Europe and the United States.
Moreover, European companies account for a significant percent of all US portfolio inflows – not insignificant for the world’s largest debtor nation, which has to borrow $1 billion a day to finance its near record current account deficits.
European firms have never been as dependent on American prosperity as they are today. In fact, Europe’s investment stake in America is one-quarter larger than America’s stake in Europe.
There is more European investment in Texas than all American investment in Japan.
German affiliate sales in the U.S. are more than four times greater than German exports to the U.S. – a dramatic comparison given that Germany traditionally has been considered a classic "trading" nation.
The bulk of corporate America’s overseas workforce does not toil in low-wage nations like Mexico and China. Rather, they are employed in relatively well-paying jobs in Europe.
The manufacturing workforce of U.S. affiliates in Germany is double the number of manufacturing workers employed by U.S. foreign affiliates in China. The number in the UK is five times what it is in China.
What about last spring? The Bush Administration’s war frustrations with Europe did not stop corporate America from pumping nearly $40 billion in foreign direct investment into Europe in the first half of this year, a near 15% increase from the same period a year ago.
Most surprising is the fact that American foreign direct investment in France—despite fierce anti-French rhetoric in the United States—surged to $2.3 billion in the second quarter, one of the highest quarterly levels in nearly a decade.
In addition, Wall Street’s appetite for French securities has soared this year, with net U.S. portfolio inflows to France rising to $3.9 billion in the first eight months of this year. That compares to less than $1 billion in the same period a year ago and marks a sharp turnaround in U.S. sentiment since the 1998-01 period, when U.S. investors were net sellers of French stocks and bonds.
U.S. investment flows—both foreign direct investment and portfolio—to Germany were just as strong, despite the fact that the war with Iraq caused U.S.-German relations to ebb to one of the lowest levels since World War II.
Despite strained political relations, corporate America ploughed nearly $5 billion into Germany in the first half of 2003, a sharp reversal from the first half last year, when U.S. investment in Germany actually contracted by $4.7 billion. U.S. investors sunk an additional $700 million in German securities in the first eight months of the year. On the trade front, U.S. exports to Europe’s largest economy climbed by over 10% in the first eight months of this year, well ahead of the 2.4% increase for total U.S. exports in the same period.
In short, while the U.S. House of Representatives spent its time changing French fries to “freedom fries,” U.S. firms in France and other parts of Europe were busy booking healthy profits and bolstering the bottom line.
Earnings of U.S. foreign affiliates in Europe soared to nearly $35 billion, a 23% surge from the same period a year ago. U.S. profits from France jumped to $1.7 billion in the first half of this year, up from just $700 million the same period a year ago. Ironically, in a year when U.S.-European relations have never been rockier, American firms, on a cumulative basis, are on track to post record earnings from Europe in 2003.
Virulent anti-American sentiment across parts of Europe this spring did not prevent European firms from investing $36.3 billion in foreign direct investment in the U.S. in the first half of this year. That represents a sharp rebound from the depressed levels of the prior year, when European FDI inflows to the United States totaled just $16.5 billion in the first half of the year and $26 billion for all of 2002.
German firms were among the largest European investors in the U.S. in the first half of 2003, with German foreign investment in the U.S. soaring to $6.4 billion versus a contraction, or disinvestments, of $4.6 billion in the same period of 2002. German portfolio managers, meanwhile, snapped up nearly $12 billion in U.S. securities in the first eight months of this year after being net sellers (to the tune of $2.3 billion) last year.
In a dramatic turnaround from a year ago, and reflecting the buoyancy of U.S. financial markets this year, Euroland portfolio inflows to the U.S. totaled $47 billion in the first eight months of the year. That compares to just $1.3 billion in the same period last year.
Finally, despite the vitriolic talk of boycotting European goods in general and French products in particular, the earnings of European affiliates in the United States jumped by nearly 50% in the first six months of the year, climbing from $15.1 billion to $22.1 billion. French affiliates, incidentally, saw their U.S.-based earnings soar to $2.5 billion in the January-June period versus $1.4 billion a year earlier. Diplomacy aside, many European firms have seen their U.S.-based profits rebound along with the U.S. economy, a dynamic that has been critical in offsetting weak growth and earnings in Europe.
I am not suggesting that the transatlantic economy is impervious to the sour and strained mood of the moment. Rather, all the loose talk of transatlantic divorce ignores just how economically fused both shores of the Atlantic have become since the end of World War II, and particularly since the end of the Cold War. Contrary to expectations, these bonds have only tightened this year.
What has changed is the relationship between our strategic and economic agendas. During the Cold War, leaders worked hard to keep transatlantic economic conflicts from spilling over to damage our core political alliance. Today, the growing challenge is to keep transatlantic political disputes from damaging our core economic relationship.
Pouring French wine down the drain or vandalizing McDonald’s may make for splashy headlines, but the more significant development is the accelerating integration and cohesion of the transatlantic economy. Failing to understand this dynamic can lead to serious policy errors and threatens to shortchange American and European consumers, producers, workers and – perhaps -- voters.
This deep integration has political consequences. Among the nations of the European Union the policies of European integration reach so deep that it is common to hear that European policies have become domestic policies, and that EU countries have entered a new realm of “European domestic policy.” This is very true, but it doesn’t even begin to capture the real dynamic under way. A similar, if largely unnoticed, process has been underway for some time across the Atlantic. Our economies and societies have become so intertwined that in a number of specific areas Europeans and Americans have transcended “foreign” relations. We have moved into a new arena of “transatlantic domestic policy” --Transatlantische Innenpolitik -- a new frontier in which specific social and economic concerns and transnational actors often jump formal borders, override national policies, and challenge traditional forms of governance throughout the Atlantic world.
Transatlantic governance today is being defined as much by webs as by walls, as much by networked cooperation among private actors as by hierarchical rules set by governments. The Cold War image of a two pillar Atlantic world is being challenges by dense transatlantic networks within a common Atlantic space that has no center. These networks of interdependence have, in fact, attained a quality far different than those either continent has with any other. We have only begun to understand the many dimensions of this phenomenon.
Many of the issues confronting European and American policymakers today are those of “deep integration,” a new closeness that strikes at core issues of domestic governance, and that is of a qualitatively different nature than the “shallow integration” model of the Bretton Woods-GATT system established during the Cold War.
Deep integration is generating new transatlantic networks and new connections. But because it reaches into traditionally domestic areas it can also generate social dislocation, anxiety and friction, as on such issues as food safety, competition policies, religious cults, privacy protection or the death penalty.
Such conflicts are unlikely to endanger the relationship, and are more a symptom that our societies are interacting so closely that many issues are debated as quasi-domestic controversies. Such controversies rarely reflect differences in values themselves than different perspectives on what tradeoffs are politically or socially acceptable when these values collide with each other.
On many of these issues, in fact, differences within the U.S. and within Europe are more serious than those between Americans and Europeans.
Moreover, European and American scientists and entrepreneurs are pushing the frontiers of human discovery in such fields as genetics, nanotechnology and electronic commerce where there are neither global rules nor transatlantic mechanisms to sort out the complex legal, ethical and commercial tradeoffs posed by such innovation.
In addition, in many areas of public policy transatlantic policy sharing has become a major pathway of change in our respective domestic policies – from vocational training models, enterprise zones, urban revitalization and ecology, transportation, social and civic activism, etc.
Neither the framework for our relationship nor the way our governments are currently organized adequately captures these new realities. Opinion shapers need to look more closely at the intersection between deep Atlantic integration and traditional areas of domestic regulation. There is considerable need to work more concertedly to identify “best practices” for governance that could improve coordination and create safety valves for political and social pressures resulting from deep integration. In democratic societies controversial domestic issues are decided by elections or court rulings. Across the Atlantic such quasi-domestic issues need be managed through new forms of transatlantic regulatory and parliamentary consultation and coordination and more innovative diplomacy that takes account of the growing role of private actors.
Iraq has been a loud wake-up call to our partnership. The question facing us is whether we can respond to this transatlantic trainwreck through a corrective vision that aligns the lenses of November 9 and September 11 and enables us to assume the obligations our partnership demands -- in Europe, beyond Europe, and between our societies – for history will ultimately judge us not only in terms of how well or badly we managed a particular crisis, but also how well we used such crises to shape our relationship for the future.
These steps will require our governments to work more closely together. But the strength of our relationship depends ultimately on the ties between our people. In today’s world, we are flooded with information, but information is not understanding.
As we have seen in recent months, swift means of travel and communication simply mean that misunderstandings and prejudice now travel at the speed of light. It is the very closeness of transatlantic relations that makes it especially vulnerable to such misunderstandings.
There is a growing mismatch between how leaders and specialists are trained and organized to manage transatlantic affairs, and what skills will be required to meet 21st century challenges. Information is widely available about how our respective societies are changing, but we must continue to invest in the human dimension of our partnership to help each other make sense of that information. That is why the work of the organizations here today remains so critical, why it is so important to strengthen the human foundation of our relationship and to build transatlantic leaders ready and able to address the challenges of this new century. Thanks to you all.