GLOBAL ECONOMIC VIEWPOINT
LETTER TO AMERICA
Giuliano Amato is a former prime minister of Italy; Ralf Dahrendorf, a member of the British House of Lords, was director of the London School of Economics; and Valéry Giscard D'Estaing is a former president of France. This article was drafted under the auspices of the Aspen Institute Italia in Rome.
Dear President Bush:
As the political dust settles in your country after a long campaign season, we urge you to promptly engage in a reassessment of relations with the Europeans.
In the post 9/11 global environment, the United State swill need friends even more than it did before. However powerful your country may be, experience has already demonstrated that you will need allies and functioning global institutions to preserve your fundamental interests. Your best potential partners remain the Europeans. For all our current shortcomings, we share basic values, we are committed to democracy and market economics, and we are strong believers in making multilateral institutions effective.
The hard lessons of the past two years are clear for the Europeans as well: If we are split, we are unable to exercise any significant international influence. Building a new deal with the United State swill not only be a decisive contribution to our security in the emerging global system,but it will also be an essential condition to preserve European cohesion.
There are five important points to make:
First: Be multilateral and effective.
Whatever the pros and cons of working multilaterally or unilaterally today, the case for the former is bound to grow in coming decades. The rise of China and India as economic, military and diplomatic heavyweights seems certain, and Russia may be heading down the same path.
Any conceivable alternative to a strong alliance with Europe is a worse option, and only a solid Euro-American core can make international institutions more effective. This is also true for U.N. reform — which we need to promote jointly. As a matter of fact, Europeans have to accept that old rules governing the use of force must be updated, given the nature of new threats, while the United States has to openly recognize the merits of effective multilateralism.
Second: A strong Europe makes for a strong alliance.
Mr. President, a more integrated Europe is in America's long-term interests, even though there will be times when it opposes you on, say, specific trade issues or the Kyoto Protocol.
In order to encourage the Europeans to rise to the major challenges of our era, and meet the targets that we will both agree upon, you could offer a series of tradeoffs.
For example, you could promise the Europeans that if we deliver on our pledges, you will loosen your protectionist rules on the transfer of military technology. You could even give away some of the "network-centric warfare" technologies that would make it easier for the Europeans to operate alongside your forces. You could offer more of the top command slots within NATO to the Europeans. And you could share more intelligence with your key allies.
Given all this, a new transatlantic deal should rest on a geographical division of labor, with the European Union serving as the prime guarantor of continental security and stability in and around Europe.
Then, you should encourage the Europeans to think globally by offering to work with us in developing joint strategies on Russia and China.
Both of us want the economy in Russia to grow strong and integrate with the West, including in the energy sector, but we also want a peaceful end to the Chechen conflict and the protection of civil liberties. We will only be able to influence Russia's behavior if the United States and the European Union forge a common line, and stick to it.
Our fundamental interests are similar in China. Yet we need to learn to think not only about the economics, but also about the politics of the rise of China. Of course we cannot determine the evolution of the political system in China, nor its foreign policy. But together, the European Union and the United States should set out our preferences and make it clear to China that its actions and policies will influence our own.
It is indispensable that we agree on common guidelines for the sale of military — or dual use —goods to China, before this turns into a new strategic rift.
Third: Work jointly on the Middle East — the Smaller and the Greater.
Mr. President, in the next four years you will probably spend more time and energy on the broader Middle East than on any other international region. The Greater Middle East is just as central to the geopolitics of the next decade as Europe itself was during the early Cold War. This may change over time, but it is the reality today.
It will be hard to get other countries to send troops to Iraq — and yet the European contribution in money and political support remains important. To achieve this, Mr. President, do not appeal just to Atlantic unity. Underline that you want to start a new phase in U.S.-European relations and that you value a stronger Europe, one that is willing to assume more international responsibility. This could be the premise of a successful cooperation effort, beginning in Sharm el Sheik and Rabat.(International conferences will be held in these places to discuss the reconstruction of Iraq. — ed.)
Best of all, offer the Europeans a quid pro quo: If Europe supports common efforts in Iraq (some with troops, others by increasing support to the buildup of Iraqi forces) and commits more financial resources to the reconstruction, America will uphold its promise of promoting a Palestinian state by 2006.
On Israel-Palestine, you still need to demonstrate, in deeds not just words, that the United States is serious about seeking a two-state solution. For most Arabs, Washington's willingness to spend real resources and political capital on finally solving the Israeli-Palestinian problem is a litmus test for America's standing in the region. You should propose to the Europeans that together we assist and train Palestinian security and police forces and that, provided a cease fire is firmly in place, NATO should play a role in delivering security together with Arab countries like Egypt. Given the vicious cycle of violence and insecurity, a NATO-led force may be the only way out. At the same time, we Europeans will have to focus our efforts on assisting the rise of a responsible and accountable post-Arafat Palestinian leadership.
On Iran, many Europeans feel that U.S. policy is all sticks and no carrots; most Americans feel the exact opposite about Europe's policy of "conditional engagement." The Iranians have cleverly used these transatlantic divisions to proceed with their nuclear program.
Europe and America should partly switch sides. Thus, you should encourage the Europeans to consider using sticks, as long as the provisional agreement with Iran is not implemented; in turn, America should set out what incentives it is willing to offer Tehran in return for a verifiable end to Iran's nuclear program.
It would be useful to set up a contact group between the United States, the European Union (combining the major powers involved plus Solana) and Russia.
Fourth: It's Also the Economy, Mr. President!
We have to devise an economic new deal. The European and American economies remain tightly interdependent — in fact they have become increasingly so — and the United State sand Europe represent the keystone of the global trading system.
The single most relevant action of your first administration as far as impact on the world economy is concerned was the reversal of the federal budget from a surplus of almost $250 billion in 2000 to a deficit of more than $400 billion in 2004. This has provided a powerful stimulus to the United States and world economies but has also increased the instability of the international financial system.
What we need, Mr. President, is this kind of new deal: a commitment by the United States to gradual fiscal consolidation, a commitment in Europe to accelerated reform so as to raise potential growth and a commitment by China to abandon the dollar peg and to replace it with a peg to a basket of currencies including the dollar and the euro. To further this goal — and as part of our common global strategy — we should encourage growing links between the G7 and China.
In tackling the global problem of poverty and underdevelopment, the United States remains the industrial country with the lowest aid/GDP ratio, and your first administration insisted on shifting the emphasis from loans to grants for poor countries. We all know that it is highly unlikely that the United Nations' Millennium Development Goals will be met. While the emphasis on better governance is well placed, resources for development need to be significantly increased — both in Europe and in the United States. Mr. President, this must become a main joint undertaking for the next G8 summit.
Looking at trade issues, successful completion of the Doha Round (the current world trade negotiations focus on removing barriers for developing countries)would provide a major boost to global growth as well as to the fight against poverty.
Lastly,given the links between energy prices and economic prospects, we urge you to make a fresh start in environmental policies. We know all too well why signing the Kyoto Protocol will not be an option for you anytime soon,and yet you have to devise an American proposal compatible with the general objective of this international treaty.
Five: Think of a new strategic forum.
In order to cooperate effectively, albeit with asymmetrical capabilities and roles, the Western allies have to share decisions. On the American side, this means real consultation — not just setting the line and expecting us to follow. On the European side, this means creating a better decision-making mechanism, which has to be of a collective kind.
We suggest creating a Contact Group, serving as a much more functional forum between the European Union and the United States than anything we currently have. NATO is now too large and too reactive to allow a real strategic discussion. The EU-U.S. annual summits are almost useless as a real venue for decision-making. The G8 and the United Nations Security Council,both considering enlargement, would benefit from tighter transatlantic consultations.
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As you can see, Mr. President, we believe that traditional Atlanticism belongs to the past, yet we are deeply convinced that a new transatlantic deal should be part of our future.
On the basis of our historical roots, it is natural — and even healthy — for both Americans and Europeans to define our respective identities in terms of mutual differences. A value gap is emerging across the Atlantic — especially if we look at our public opinions — which makes it impossible to just appeal to common values as the basis of a strong alliance. But two mirror-image errors must be avoided: Americans should not cease to view European integration as in their best interest, and Europeans should not begin to define their identity in opposition to the United States.
We still share bounds of civility and interests in the world that will be more effectively protected if we do it together. They are equally crucial to a new transatlantic deal.
(c) 2004, ASPEN INSTITUTE ITALIA/Global Viewpoint