Future-Proofing Transatlantic Relations (II): Taking Advantage of the 2023 Window of Opportunity
The transatlantic partners need to lock in gains now before the next election cycle in the US and in Europe may create a less favorable environment for cooperation.
Spring 2023 Issue: The China Challenge
The United States’ policy and approach to Europe has done a 180 in the past few years. During the Trump administration, the relationship was mired by challenges and struggles. Not only did the usual sources of tensions exist—the decades-long Boeing-Airbus dispute, disagreements over data privacy, and the call for NATO allies to contribute their fair share to security and defense—but the Trump administration oftentimes outright beat up on allies. Most egregiously, the administration called the European Union a “foe” and imposed Section 232 steel and aluminum tariffs on Europe.
However, the tides have turned under Joe Biden’s leadership. At the start of his presidency, calls to European allies were one of Biden’s first stops, only following calls to the US’ northern and southern neighbors, Canada and Mexico. Biden’s commitment to the transatlantic relationship has many analysts touting him as the most transatlantic US president in recent memory. While actions have not always lived up to rhetoric, the Biden administration’s tone and tenor toward Europe enabled the relationship to focus on an affirmative agenda for democracies, rather than solely focusing on irritants in the transatlantic relationship.
The current moment is defined by uncertainty on both sides of the Atlantic over the political future. As a result, time is running out to preserve gains for the future of the transatlantic relationship. 2024 will bring European Parliament elections and the election of a new European Commission president, signaling an end to Ursula von der Leyen’s first commission. Likewise, the United States will elect a president in 2024.
Therefore, the next year will be critical in preserving wins from Biden and von der Leyen’s tenures before election periods result in foreign policy taking a backseat. In Europe, a focus on domestic policy is especially likely as the knock-on effects from Russia’s war against Ukraine begin to take hold, including an economic downturn and an energy crisis. Will a “geopolitical commission” be feasible if Europe is facing economic uncertainty? Will the next US president favor isolationism above multilateralism and cooperation with allies? The transatlantic partners must act now to lock in progress in the relationship before 2024.
Pairing a Multilateral and a Domestic Approach
For one, the United States and Europe should move forward on areas of transatlantic agreement by pairing a multilateral approach with a domestic approach. One lesson from the Trump administration is the great extent to which international treaties are subject to a US president’s political whims. President Donald Trump withdrew the United States from the Paris Climate Agreement with the swipe of a pen, while President Biden rejoined them in the same fashion. To future-proof policy priorities, the United States and Europe should advance initiatives in their legislative branches. For example, the US Congress recently passed the Inflation Reduction Act (IRA), which invests $369 billion in climate action and works toward a 40 percent reduction in emissions by 2030. The IRA will be far harder to reverse than a treaty, since a replacement must pass both chambers of Congress and be signed by the US president.
In taking a domestic approach to transatlantic goals, however, both sides of the Atlantic must be careful of legislation’s unintended consequences that exacerbate tensions in the transatlantic relationship. In the case of the IRA, the legislation ends tax credits for electric vehicles assembled outside of North America, which has ramifications for automakers in allied nations who export to the US, such as Germany and South Korea. At the same time, the United States and Europe should keep initiatives in perspective and focus on the bigger picture—in this case, securing gains on the climate agenda—rather than on petty disagreements between the transatlantic partners.
Similarly, the transatlantic partners should work to institutionalize cooperation. The EU-US Trade and Technology Council (TTC) illustrates the importance of formalizing transatlantic dialogues on key issues to help them live beyond the current US and European administrations. However, these dialogues must be more than transatlantic talk shops. A failure to achieve any tangible results might relegate these dialogues to the dustbin of history.
A few tacks could help these venues be more effective. First, the transatlantic partners must prioritize among proposed initiatives. The TTC’s May 2022 joint statement outlines dozens of transatlantic initiatives to pursue without any prioritization. The transatlantic partners must focus on what is achievable in the next two years, even if that is reaching for the low-hanging fruit, such as mapping policies and best practices in technology areas and establishing a mechanism to prevent a subsidy race in the semiconductor industry. Producing results will galvanize momentum in the relationship and will provide a strong proof of concept for the dialogues to continue in future administrations.
Another tack is bringing in other countries beyond the transatlantic partners, such as South Korea, Japan, and the United Kingdom in the case of the TTC. Even if one of the transatlantic partners withdraws from the dialogue, widening the pool of stakeholders to include more countries will allow the dialogue’s initiatives to endure going forward, at least in some form.
Networking at Grassroot Level, Moving Forward on Trade
An additional measure the transatlantic partners can take is to begin developing relationships and engaging stakeholders at local levels, including in European Union member states, US states, and cities. In recent years, US states advanced initiatives more closely aligned with European partners. For example, when the US Congress failed to move forward with federal data privacy legislation, a few states took the initiative. In the case of data privacy policies, three states—California, Virginia, and Colorado—passed comprehensive consumer privacy laws. Similarly, cities are also taking the initiative absent federal action. Portland, Oregon was the first large US city to pass restrictive laws on the use of facial recognition. Europeans should begin to foster ties and build relationships with US counterparts on the state and city levels as an avenue for cooperation and information sharing.
Finally, the transatlantic partners should attempt to find breakthroughs in trade irritants and technology rifts in the relationship in the next year. The United States and Europe have made great strides in the past two years to address long-standing friction in the trade domain. A few recent examples are worth emulating in other trade areas: the June 2021 resolution of the 17-year Boeing-Airbus dispute and the October 2021 lifting of the Section 232 steel and aluminum tariffs. In the technology domain, the recently announced Trans-Atlantic Data Privacy Framework paves the way for future transatlantic cooperation on other technology issues, such as artificial intelligence. Furthermore, the October 2021 agreement on digital service taxes (DSTs) soothes another irritant roiling under the surface of the transatlantic relationship.
Other areas where the transatlantic partners could replicate this progress include the conflict over electric vehicle subsidies and the disagreement over WTO reform, including the role of and appointments to the WTO’s Appellate Body. Additionally, the transatlantic partners should dig deeper on those issues in which they have met temporary resolution. In the cases of steel and aluminum tariffs, aircraft subsidies, and DSTs, the transatlantic partners should work toward long-term and sustainable solutions that will outlast the current administrations on both sides of the Atlantic.
The time to lock in progress in the transatlantic relationship is now. A failure to do so risks a crack up in the relationship that might not withstand an isolationist, climate-skeptic, or anti-transatlantic administration on either side of the Atlantic. The stakes of a divided transatlantic alliance are high. Authoritarian states, such as Russia and China, capitalize on a fragmented relationship. Moscow attempts to inject its influence into the political environment, while Beijing aims to fill the vacuum created by an absence of US leadership in Europe. The transatlantic partners must put in the work now or risk the transatlantic and democratic agenda grinding to a halt for the foreseeable future.
Carisa Nietsche is an associate fellow for the Transatlantic Security Program at the Center for a New American Security (CNAS) in Washington, DC.