• Putting Transatlantic Relations on the Road to Recovery - Workshop

    Friday 23rd January 2004 - 9:00am - 12:00pm

    Download PDF

  • Putting Transatlantic Relations on the Road to Recovery Workshop


    Annual Meeting 2004

    Post Cold War, post Berlin Wall and now post Iraq, the transatlantic relationship has been characterized by deep fissures of political attitude and smooth areas of economic convergence. A soul searching, rich dialogue covering a spectrum of issues business, society, intellectual relationships, the economy and security revealed that new, creative thinking is needed to bring the relationship back on an even keel, or, if necessary, to chart a new course. At the same time, observed Moderator Theo Sommer, Editor at Large, Die Zeit, Germany, "we are not as far apart as we think."

    Despite the often diametrically opposed views on both sides of the Atlantic, for the most part it is business as usual in the private sector. However, Paul Achleitner, Member of the Board of Management, Allianz, Germany, admitted that in the wake of 11 September there is a twinge of uncertainty amongst European business leaders as they experience shifts in the US regulatory environment. Several participants pointed to the controversial Sarbanes Oxley Act in the US as proof of this trend. Alex Mandl, Chief Executive Officer, Gemplus International, France, said recent overall political tensions have been less important, including security issues. An important issue to consider is where Europe has unity and a common vision, commented Laura D. Tyson, Dean, London Business School, United Kingdom. Within competition and trade policy there is space for very effective transatlantic relations. This works at the level of dispassionate engagement within a common model, but does not in the areas of military, foreign and economic policy. "It is amazing how we survive major stress points in the transatlantic relationship, yet business relations are not at risk. This is remarkable; it shows the depth of interdependence."

    Differences in societal trends took root at the end of the Cold War, when the existence of the common enemy ceased to cement the relationship. Jean Charest, Premier of Quebec, Canada, told participants that Canadians have aggressively pursued the ability of countries, national and sub national governments to protect cultural diversity: "The sheer force of American culture is often overwhelming. This anxiety is shared by Europe and developing countries." In negotiating trade agreements with the US, Canada defended its right to subsidize its cultural industries. "If the relationship is to bear any fruit, the US must realize there is a diversity of culture that deserves to be supported and recognized." Pat Cox, President of the European Parliament, Brussels, said "a belief in solidarity plays itself out in different preferences," such as through promoting human rights, the International Criminal Court, and the Kyoto Protocol, and most recently, data issues concerning airline passengers. Security and privacy issue trade offs underscore the differences.

    Klaus Gretschmann, Director General, Economic Policy Directorate, Council of the European Union, Brussels, listed a host of intellectual differences. Will there be a convergence in thinking and beliefs? "Yes it is possible, yes it is probable, but not for the time being. Demographics vary wildly between the two, reported Charles Grant, Director, Centre for European Reform, United Kingdom. The current economic imbalance and the lower European fertility rate have serious consequences for the strategic and political dimension of the relationship. The median age in Europe by 2050 will be 53, compared to 36 in the US. That same year, citizens over age 65 will comprise 60% of the European population and just 40% in the US. If the US per capita GDP remains the same, the American economy will be twice as big as Europe s.

    In terms of the economy, there are several areas of convergence, particular in the trade arena, observed Caio Koch Weser, Secretary of State of Finance of Germany. Participants were enthusiastic over his proposal for an upstream information "G 2" consultation process; however, it would depend on US willingness to engage. Mario Monti, Commissioner, Competition, European Commission, Brussels, pointed to considerable convergence in antitrust and competition policy: "So much divides us, but not this issue. There is intellectual convergence here."

    NATO is "alive and kicking and on track" in its mission to promote global security and stability, reported Jaap de Hoop Scheffer, Secretary General of the North Atlantic Treaty Organization, Brussels. He urged the EU to move on the Common Foreign and Security Policy and for both parties to work on differences in perceptions of terrorism. The state of the transatlantic relationship will also depend on the Alliance s relationship with the Russian Federation and Turkey.

    Facilitator Stuart E. Eizenstat, Partner, Covington & Burling, USA, reminded participants that in the wake of 11 September, the US has a "different psyche", which means there will be more pressure on NATO and Europeans to act in real time. This view was amplified by Christopher Shays, Congressman from Connecticut (Republican), USA: "To us, the new world order is detection, prevention, pre emption and, in some cases, unilateral action." He described Iraqi s captured dictator Saddam Hussein as "an evil and destructive force in the middle of a strategic area…. I am sorry Dick Cheney and John Ashcroft are so bright. They happen to be right. But I am sorry our government is so arrogant."

    It is important to find the critical balance between freedom and security, commented Tarja Halonen, President of Finland: "We cannot live through too many Iraqs." Despite these differences, "what unites us is stronger than what divides us," said Anders Fogh Rasmussen, Prime Minister of Denmark. He acknowledged that Europe must improve its defence capabilities and pointed out that preventing terrorism is not just a military matter: "We must promote democracy, human rights and social stability in the Arab world." A transatlantic strategy for the Middle East is critical. The prime minister proposed the creation of a Commission on Security and Co operation in the Middle East, modelled after the Commission on Security and Co operation in Europe created during the Cold War. Europeans will never agree with the current work sharing agreement with the US, whereby the Americans wield military might and Europe cleans up the mess, commented Angela Merkel, Chairperson, CDU/CSU Parliamentary Group in the German Bundestag.

    In the US, two dynamics are converging incorporating African, Hispanic and Asian influences and the cultural revolution of the 1960s into today s change culture, which is sweeping up much of America and propelling it forward, observed James F. Hoge, Editor, Foreign Affairs Magazine, Council on Foreign Relations, USA. In Europe the focus is more on establishing and implementing common values. Laurent Joffrin, Editor in Chief, Le Nouvel Observateur, France, said there are shared values, but divergent beliefs in issues such as the death penalty, the welfare state and multilateralism.

    There have been productive changes in the relationship, commented Craig Kennedy, President, German Marshall Fund of the US, USA: "On the US side there is a growing recognition that we must work with a unified Europe. Last year Europe focused on its military capacity deficit, but the real deficit is in its thinking about its role in the world." He also emphasized the need to tackle the Middle East conflict.

    It is important to understand the degree to which ideology and partisanship form the dominant theme in US politics, said James A. Thomson, President and Chief Executive Officer, RAND Corporation, USA. In Europe, those issues are pushed aside in the interest of coalition and consensus.

    The gap is not as wide as portrayed by the media, confirmed Sommer. After all, Europeans criticizing administration policy are not necessarily criticizing the US. At the same time, "Americans should accept the reality of an evolving EU, as imperfect as it is. Europe is and always will be a work in progress."

    Related Link

    Annual Meeting


  • Paul Achleitner Paul Achleitner
    Chairman of the Supervisory Board, Deutsche Bank, Germany

    Studies, Univ. of St Gallen (HSG), Switzerland and Harvard Business School; PhD, HSG. Four years at ...

  • Tarja Halonen Tarja Halonen
    Co-Chair, UN Secretary General High Level Panel on Global Sustainability, United Nations, Switzerland

    Master's in Law. Formerly: trade union lawyer; 1971, Member, Social Democratic Party; 1979, elected ...

  • Anders Fogh Rasmussen Anders Fogh Rasmussen

  • Angela Merkel Angela Merkel
    Federal Chancellor of Germany

    1973-78, studies in Physics, Leipzig University; 1986, doctorate; 1978-90, academic positions; 1990,...

  • Charles Grant Charles Grant
    Director, Centre for European Reform, United Kingdom

    Studies in Modern History, Cambridge University. Formerly, with Euromoney, London. 1986-98, with The...

  • Caio Koch-Weser Caio Koch-Weser
    Vice-Chairman, Deutsche Bank, Germany

    1973-99, with World Bank, incl.: Div. Chief, China; Director, West Africa; Deputy Treasurer and Dire...

  • Klaus Gretschmann Klaus Gretschmann

  • James F. Hoge James F. Hoge
    Counsellor, Council on Foreign Relations, USA

    BA in Political Science, Yale University; MA in History, University of Chicago; AMP, Harvard. Three ...

  • Jean Charest Jean Charest

  • Stuart E. Eizenstat Stuart E. Eizenstat
    Partner and Head, International Trade and Finance, Covington & Burling, USA

    1964, degree (Hons) in Political Science, Univ. of N. Carolina; 1967, degree in Law, Harvard. 1977-8...

  • Laura D'Andrea Tyson Laura D'Andrea Tyson
    Professor and Director, Haas School of Business, University of California, Berkeley, USA

    With the Clinton Administration: 1993-95, Chair, Council of Economic Advisers; 1995-96, Director, Na...

  • Mario Monti Mario Monti
    Senator, Senate of Italy, Italy

    Studies at Bocconi University and Yale University. Formerly, Professor of Economics and Rector, Bocc...