Germany’s announcement that it was expelling the CIA station chief in Berlin has taken U.S.-German relations to a new low, engendering anger on the part of Chancellor Angela Merkel, President Barack Obama’s favorite foreign leader. The expulsion is designed by Berlin not only to make clear the government’s rejection of American spying practices in Germany. It is also an effort by Merkel to deal with indignation among the German public and political class about these practices and with criticism that she failed to call Obama’s administration to account much earlier for the extensive espionage in Germany by the National Security Agency (NSA), which was revealed last year by the whistleblower Edward Snowden.

During the Cold War, no stronger institutional link between the United States and Germany existed than that between the CIA and the Federal Intelligence Service (Bundesnachrichtendienst or BND). The Agency midwifed the BND in the 1940s, financed and controlled it into the 1950s, and maintained a close relationship with it for the following three decades, providing it with much intelligence—not just human intelligence (Humint) but satellite imagery (Imint) and signals intelligence (Sigint) as well. But during those decades it never fully trusted the BND or its counterintelligence counterpart, the Federal Office for Protection of the Constitution (Bundesamt für Verfassungsschutz or BfV), fearing they had been penetrated by the East German espionage service. Indeed, they had; East German agents worked for many years at near top levels in both organizations.

Throughout the Cold War both the CIA and NSA maintained very large presences in West Germany, especially in West Berlin, where the NSA ran a large signals interception facility atop the Teufelsberg, a hill made up of rubble from city buildings destroyed in World War II.

During these decades, West German and American foreign political priorities coincided, chief among them by far combating Soviet communist power. The United States got used to West Germany as an American protectorate, within which its spy agencies could operate pretty much as they wanted. The BND was treated by the CIA as kind of a “little brother.”

After reunification in 1990, Germany gained greater scope to act independently. Its interests abroad began to diverge from America’s. Its primary focus became the increasingly integrated European Union (EU)—of which it is now the most influential member. The reunified economy began to generate large export surpluses not only with other EU countries, but also with countries at political odds with the U.S.: Russia (which provides Germany with 30 percent of its natural gas imports); China (which Merkel has visited seven times with large retinues of German corporate executives in tow, most recently just last week); and Iran.

Following the 9/11 terrorist attacks on the U.S., both the NSA and CIA stepped up their intelligence gathering in Germany and information exchange with the BND. Snowden revealed the massive scale of the NSA’s collection of German citizens’ metadata, including intercepting Merkel’s mobile phone conversations. The CIA succumbed to easy espionage opportunities, two of which have surfaced this month: a midlevel BND archivist was arrested for allegedly passing the CIA 218 BND documents during the past two years in exchange for a €25,000 payment; and a minor civilian employee of the Ministry of Defense is under investigation as a possible American spy.

Accustomed from the Cold War years to operate in Germany with immunity as well as impunity, the CIA seemingly has not balanced the risks for other American political objectives of exposure against the gains for intelligence from two such little fish—information that the Germans would likely have provided through regular diplomatic or intelligence liaison. German political leaders’ have reacted with scorn. “An ultimate waste of energy,” observed Merkel. “Not just unseemly, it is unnecessary,” commented her foreign minister, Frank-Walter Steinmeier. “Nonsensical and stupid,” added her finance minister, the venerable Wolfgang Schäuble.

The damage assessment is lengthy.

Of course, intelligence collaboration will continue. It has weathered similar problems in the past, such as in 1994, when the CIA station chief was asked to leave, according to press reports, for having run a unilateral spy project to which Germany objected. Today to a greater extent than then, both Germany and America are dealing with pressing security problems, such as Islamic terrorism, Russian expansionist intentions in Ukraine, or Iranian nuclear weapon aspirations. However, the BND and BfV are less likely to trust their American counterparts now and in the future and will likely keep a closer eye on their espionage operations.

In these new atmospherics, Merkel will find it harder to expand—or even preserve—common diplomatic approaches with the United States. Since she is the Western leader who has dealt most often with Vladimir Putin, sometimes phoning with him almost daily, her contribution to American policy dealing with Russia is invaluable. Negotiations on the Transatlantic Trade and Investment Partnership (TTIP), a project Washington favors but many Germans oppose, will face tough sledding unless Merkel gets behind it, as will efforts to conclude a binding international agreement on global warming. Last winter German leaders such as President Joachim Gauck, Defense Minister Ursula von der Leyen, and Foreign Minister Steinmeier argued that the time had come for Germany to engage more politicallly and even militarily in problem areas abroad, including outside Europe. The United States should welcome this readiness, but it may now be diminished.

What should the United States do to repair the damage wrought by overdone and irresponsible spying in Germany?

Above all it must recognize that the days of America’s Cold War superiority complex have gone and show Germans that it takes their country seriously as an independent actor. A public apology about past practices would be one way to convey this to an angry German public and political class.

An effort was made by Germany last year and early this to bring about a “No Spy Agreement“ like that which the United States has had with the “Five Eyes“ (the UK, Canada, Australia, and New Zealand) dating back to post-World War II. The effort collapsed this spring, with the United States refusing such an agreement. Banking on his close relationship with Merkel, Obama should offer her a personal no spy agreement, promising to keep her chancellery fully informed of all American espionage activities related to Germany or its interests abroad.

This is the bare minimum necessary to restore a measure of trust between the two countries and to avoid jeopardizing German readiness to join in common foreign policy approaches with the United States.