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11. Europe under US Monetary Hegemony: How the COVID-19 Pandemic Will Undermine a 100-Year-Old Relationship

Author:
Brendan Brown
Publication Date:
10-2020
Content Type:
Policy Brief
Institution:
Hudson Institute
Abstract:
This policy study is based on the newly released book, Europe’s Century of Crises under Dollar Hegemony: A Dialogue on the Global Tyranny of Unsound Money, by Brendan Brown and Philippe Simonnot, published by Palgrave Macmillan. One hundred years ago, the United States emerged from the First World War and its immediate aftermath, including the Spanish flu pandemic, as the global monetary hegemon, exercising immense power over the Old Continent. This new power quickly became the source of huge instability in Europe, culminating in the collapse of the Weimar Republic. After World War II, the Bretton Woods system set new contours for US monetary hegemony, ultimately resulting in the great economic crisis of 1973–75. This woeful history continues to the present day: Dollar hegemony has not been a force for good. It could have been different. The United States and Europe would both have gained from a US hegemony based on sound money principle. Instead, the guiding characteristic of US monetary power has been inflation, especially around election time. According to the doctrine made notorious by Treasury Secretary John Connally, who served under President Nixon, “the dollar is our currency but your problem.” The US monetary regime’s further lurch toward fundamental unsoundness during the COVID-19 pandemic is not getting the new century of US monetary hegemony off to a new start. The “known unknown” is whether forces will emerge in Europe that will again challenge US inflationary dominance, as occurred under Germany’s leadership in the 1970s. Could high inflation in the post-pandemic US economy cause US monetary hegemony over Europe to crumble?
Topic:
Economics, International Trade and Finance, History, Monetary Policy, Hegemony, Transatlantic Relations, and COVID-19
Political Geography:
Europe and United States of America

12. Charting a Transatlantic Course to Address China

Author:
Julianne Smith, Andrea Kendall-Taylor, Carisa Nietsche, and Ellison Laskowski
Publication Date:
10-2020
Content Type:
Special Report
Institution:
Center for a New American Security
Abstract:
Mounting competition between China and liberal democracies will shape the course of the 21st century. The gravity and scope of the challenges that China poses have permeated the transatlantic policy agenda and become a focal point in U.S.-Europe relations. Whereas China has long been a source of disagreement and even tension between the transatlantic partners, in the past two years views have converged. The Chinese Communist Party’s (CCP) assertive actions—its “Wolf Warrior” diplomacy, aggressive influence operations, human rights violations at home, and elimination of fundamental freedoms in Hong Kong—have increased concerns in both the United States and Europe. There is now fertile ground for transatlantic cooperation on everything from reducing dependency on Chinese trade and investment to setting global norms and standards for the future. Yet, despite this convergence of views and interests, there is still no roadmap for how such cooperation should progress. This report outlines such an approach. It is based on the premise that the time is ripe for greater transatlantic cooperation on China. It also recognizes the comprehensive nature of the task at hand. Today’s controversies with China over trade, investment, technology, and global governance are all part of a larger competition between political systems and worldviews. The breadth of the challenge means that the United States and Europe must compete with China across multiple domains. This report lays out a roadmap for doing so, outlining concrete recommendations across the four sectors of technology, investment, trade, and global governance. By working together, the United States and Europe can pool the resources and leverage needed to push back against the CCP in these areas and develop preferred alternatives that advance strategic priorities for both sides of the Atlantic. Moreover, the strategies outlined in this report will also serve a second purpose: re-energizing the ailing relationship between Europe and the United States.
Topic:
Security, International Cooperation, Transatlantic Relations, and Strategic Competition
Political Geography:
China, Asia, North America, and United States of America

13. The US election 2020 and transatlantic relations

Author:
Gideon Rachman, Jeremy Shapiro, Kate McNamara, and Anand Menon
Publication Date:
11-2020
Content Type:
Video
Institution:
UK in a Changing Europe, King's College London
Abstract:
At this Isolation Insight webinar, speakers discusses the US election and what the result might mean for transatlantic relations. Speakers : Gideon Rachman, Chief Foreign Affairs Commentator, Financial Times; Jeremy Shapiro, Research Director, European Council on Foreign Relations; Kate McNamara, Professor of Government and Foreign Service, Georgetown University; Chair: Anand Menon, Director, UK in a Changing Europe
Topic:
Elections, European Union, Brexit, and Transatlantic Relations
Political Geography:
United Kingdom, Europe, North America, and United States of America

14. Brexit Waves Will Lap at America’s Shores

Author:
Robert Cox
Publication Date:
05-2020
Content Type:
Commentary and Analysis
Institution:
American Diplomacy
Abstract:
Amid the toil and trouble of their own politics Americans might have a moment to note the self-flagellation of their closest European ally. There’s more to come – and the US is going to be drawn into it, whether it likes it or not. Coronavirus has now temporarily obscured the Brexit issue while arguably inflicting upon the European Union the greatest strains since its creation. A stricken EU helps nobody.
Topic:
Diplomacy, European Union, Brexit, and Transatlantic Relations
Political Geography:
United Kingdom, Europe, United States of America, and North America

15. The Future of the European Union: Scenarios for the Start of the New Legislature

Author:
Ferdinando Nelli Feroci
Publication Date:
11-2019
Content Type:
Commentary and Analysis
Institution:
Istituto Affari Internazionali
Abstract:
A few months after the European Parliament elections, and a few weeks before a new European Commission is fully operational, the European Union is facing old and new challenges, both domestic and international. Internally, the EU will soon be testing these new institutions. In the recently elected European Parliament, nationalist and Eurosceptic political forces are a minority, but pro-European mainstream parties, which have the numbers to control the proceedings of the Parliament, have not been able to consolidate a stable and comfortable majority. The new European Commission has encountered setbacks in the confirmation procedure of three of its members and will therefore fully assume its responsibilities with some delay on 1 December.
Topic:
Government, Nationalism, Politics, Elections, and Transatlantic Relations
Political Geography:
Europe, North America, United States of America, and European Union

16. A Long-Term Perspective on NATO and the Multinational Order

Author:
Sinan Ülgen
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
The evolving external threat environment is impacting the internal political dynamics of NATO nations and is accentuating a series of already existing trends – differences in threat perceptions, burden-sharing difficulties, challenges to respond to sub-threshold threats and the rise of populism – which altogether affect the cohesiveness and potentially the effectiveness of NATO as a political and military alliance. NATO’s operational future over the next decades will be shaped by the ingenuity of the transatlantic leadership in developing new arrangements of institutional cooperation between the Alliance and the burgeoning forms of the “coalition of the willing”. The Alliance should nonetheless remain the main transatlantic political forum, given Brexit as well as the rising need for a common political response to the many challenges ranging from migration to failed states. NATO has been relatively successful in adapting to the changing security environment. Its military capabilities remain unparalleled and unrivalled. The more interesting question is however the political one. Namely how the politics of sustaining this Alliance are being shaped by the underlying dynamics that are transforming the global political, economic and military context. The paper is divided in three chapters.
Topic:
Defense Policy, NATO, Politics, Institutions, and Transatlantic Relations
Political Geography:
Europe, United States of America, and European Union

17. The Case for Transatlantic Cooperation in the Indo-Pacific

Author:
Erik Brattberg and Philippe Le Corre
Publication Date:
12-2019
Content Type:
Working Paper
Institution:
Carnegie Endowment for International Peace
Abstract:
The evolving strategic dynamics in the Indo-Pacific are of paramount importance for the future of the rules-based international order. While the United States is redirecting strategic focus to the region as part of its Free and Open Indo-Pacific strategy, Europe is also stepping up its role—leveraging a strong economic profile, long-standing bilateral ties, and active engagement in various regional multilateral forums. The European Union (EU) and its member states can make distinct contributions to an open, transparent, inclusive, and rules-based regional order, though not necessarily always in lockstep with Washington. Though few European countries have formally acknowledged the new U.S. strategy, the concept’s emphasis on rules-based order and multilateralism bears many similarities to the EU’s own outlook. The EU and many of its member states are becoming more ambivalent about Chinese power and are seeking to counter certain problematic Chinese economic behaviors, and the Indo-Pacific offers opportunities for transatlantic cooperation, though U.S.-EU diplomatic relations under U.S. President Donald Trump are significantly strained. However, the U.S. administration’s fixation on short-term transactional diplomacy, lack of commitment to multilateralism, and strong emphasis on Chinese containment are putting a damper on such collaboration with EU members. Admittedly, Europe does not aspire to be a traditional hard power in Asia, lacks significant military capabilities in the region, and is reluctant to pick sides in the escalating U.S.-China competition. Only two European middle powers—France and the United Kingdom (UK)—can project serious military force in the region, as Europe has long underinvested in defense spending and needs to prioritize more immediate security threats. But Europe can amplify its political and security role in the Indo-Pacific by leveraging the growing Franco-British presence and better utilizing the EU’s collective role. Key European countries have already expanded their security footprint in the Indo-Pacific through a more regular naval presence, bilateral and multilateral joint exercises, arms sales, and various other forms of defense cooperation. Europe’s economic role is already considerable too, as the EU is a top trade and investment partner of most regional states. Washington should welcome greater European involvement in the Indo-Pacific. A greater European presence in the region advances the U.S. objective of promoting a tighter regional security architecture with vital partners like Japan and India. Similarly, the EU’s support for the Association of Southeast Asian Nations (ASEAN) can help foster a more multilateral, cooperative Asian security architecture. As for economic and trade policy, U.S. and EU interests in the region largely overlap but do diverge in significant ways. While both Europe and the United States are keen on increasing trade flows and addressing unfair Chinese economic practices, the EU’s emphasis on free trade has allowed it to either complete trade agreements or launch new negotiations with regional partners like Australia, Japan, and Singapore. Despite the limitations constraining the transatlantic diplomatic agenda, meaningful joint and/or complementary European and U.S. action in the Indo-Pacific remains achievable, particularly between France, the UK, and the United States, though other European countries and the EU could get involved too. While the EU is not likely to formally endorse the U.S. slogan of a Free and Open Indo-Pacific, Europeans can still meaningfully advance its objectives, which are overwhelmingly consistent with the EU’s own interests and values. Washington should encourage this trend and simultaneously seek to do more to incorporate European players as key partners on the implementation of its own Free and Open Indo-Pacific strategy.
Topic:
Security, Power Politics, Bilateral Relations, and Transatlantic Relations
Political Geography:
China, Europe, United States of America, and Indo-Pacific

18. Europe can spearhead a new cycle in transatlantic relations, not President Trump

Author:
Martin Michelot
Publication Date:
06-2019
Content Type:
Policy Brief
Institution:
Europeum Institute for European Policy
Abstract:
Transatlantic cooperation has, ever since the election of President Donald Trump, been a topic of contention and concern in Europe, and created a lot of questions regarding whether the fundamentals of the transatlantic relationship were being questioned. Concerns about US engagement in NATO, a potential dissonant threat perception towards and relationship with China and Russia, and the tensions around trade agreements, and in general a perceived defiance of international liberal order are all issues that have ranked high on the agenda of European leaders since early 2017, and that continue to represent - among other issues - topics that require a deeper discussion at the political and the expert level.
Topic:
NATO, Engagement, Transatlantic Relations, and Donald Trump
Political Geography:
Russia, China, Europe, Asia, and United States of America

19. The Importance of WTO Reform from a Transatlantic Perspective

Author:
Thomas J. Duesterberg
Publication Date:
02-2019
Content Type:
Special Report
Institution:
Hudson Institute
Abstract:
Trade is at the forefront of international tensions in 2019. Political developments in the United States and Europe, and the rise of China as a peer competitor to the transatlantic economies, have led many to question the fundamental assumptions and operations supporting the World Trade Organization (WTO). Chinese mercantilism, the Trump administration’s aggressive use of unilateral tariff measures, and the inability of WTO members to reach consensus on expanding its disciplines to important new sectors and forms of commerce in the modern economy reinforce the critique of the WTO. Expansion in global trade, one of the great engines of growth and progress in bringing billions of people out of poverty since 1945, has slowed considerably in the last two decades. In 2018, however, several constructive efforts to craft reforms for this successor institution of the Bretton Woods system are engendering some hope that the WTO can be adapted to meet the needs of the contemporary economy. The first basket of problems revolves around a lack of WTO disciplines for newer sectors like services, including those associated with the emerging digital economy; for state-owned enterprises; for intellectual property protection; and for cross-border investments. The other main issues concern the sometimes ineffective and bounded operations of the WTO itself. Questions have been raised, notably by the United States, over the slow and inconsistent enforcement of existing WTO rules, and over rulings by judges in the Appellate Body which overstep the limits of existing WTO rules, undertake interpretations of domestic laws, and reinterpret facts established by earlier dispute panel decisions. This is the biggest issue now dividing U.S. and EU thinking on the reform of the WTO. The EU, Canada, Japan, the United States and other members have begun offering concrete proposals for addressing these problems, and the G20 political leaders gave a strong endorsement to their efforts in the December 2018 communique of the Buenos Aires summit. Ideas for new rules are being tested in sub-global trade agreements like the new North American and Trans-Pacific pacts and EU free trade agreements with Canada and Japan. Incorporation of new rules into the global WTO is extremely difficult; full consensus among its 164 members is required for the adoption of any new disciplines or internal operations. To overcome that impediment, this paper suggests that plurilateral agreements, like the Information Technology Agreement of 1997, be employed to establish and test new rules needed for the 21st-century economy. Some use of supermajority decision making instead of the consensus rule may also help advance the creation of new rules and redress weaknesses in WTO operations. The role of transatlantic leadership, finally, is emphasized as a key to building broad political support needed to achieve substantive reform.
Topic:
International Relations, World Trade Organization, Reform, Trade, and Transatlantic Relations
Political Geography:
Europe, North America, and United States of America

20. Europe and Iran: The Economic and Commercial Dimensions of a Strained Relationship

Author:
Cornelius Adebahr
Publication Date:
12-2018
Content Type:
Working Paper
Institution:
Istituto Affari Internazionali
Abstract:
Europe and Iran had begun to invest in a closer commercial relationship just when the United States withdrew from the nuclear deal in May 2018. Since then, Washington has re-imposed its stringent economic sanctions, targeting Iran’s oil exports as a major source of government revenue but also banning financial transactions with the country. This poses an enormous challenge for the EU, which had intended to use the 2015 agreement as a stepping stone to promote regional cooperation and, ultimately, a more comprehensive relationship with Iran. Paper produced in the framework of the IAI-FEPS project entitled “Europe and Iran in a fast-changing Middle East: Confidence-building measures, security dialogue and regional cooperation”, December 2018.
Topic:
Foreign Policy, International Trade and Finance, Bilateral Relations, Sanctions, and Transatlantic Relations
Political Geography:
Europe, Iran, Middle East, North America, United States of America, and European Union