Challenges and Choices
Following the U.S. presidential election on November 8, the debates over economic and foreign policy issues in the U.S. will reverberate well beyond the United States. Several key issues and questions are at stake for the U.S. and Germany, including shared challenges across the Atlantic: terrorist threats, the turbulence in the Middle East, and the uncertainty of security parameters on the borders of Europe, including the unprecedented refugee and migration crisis. We are also confronted by the dangers of a return of a global economic slowdown, turmoil in energy markets, and the struggle to adapt the tools of international financial institutions to cope with uncertainty. All of these challenges demand an intensive and effective transatlantic dialogue and particularly close cooperation between Washington and Berlin. What are and will be areas of cooperation or conflict across the Atlantic as the United States and Germany deal with ongoing regional and global crises? What will be the equation of burden and indeed power sharing in confronting challenges? What will be the parameters of expectations and priorities across the Atlantic? These and many more topics are on our agenda.
Jacques Brand, Senior Partner, PJT Partners
Ambassador Harald Braun, Permanent Representative of Germany to the United Nations
Susan Eisenhower, President, The Eisenhower Group, Inc.
Susan Fratzke, Policy Analyst and Program Coordinator, Migration Policy Institute
Jurgen Hardt, Member of the German Parliament (CDU); Federal Foreign Office Coordinator of Transatlantic Cooperation in the Field of Intersocietal Relations, Cultural, and Information Policy
Ambassador Wolfgang Ischinger, Chairman of the Munich Security Conference, former German Ambassador to the U.S.
Jackson Janes, President of AICGS
John Lipsky, Senior Fellow, Foreign Policy Institute, Johns Hopkins University SAIS; Former First Deputy Managing Director, International Monetary Fund
Ambassador Cameron Munter, Chief Executive Office and President, EastWest Institute; Former U.S. Ambassador to Pakistan and Serbia
Jen Olson, Lobbyist, Peck Madigan Jones
Alexander Privitera, Senior Fellow, AICGS; Senior Advisor, Commerzbank
Steven Sokol, President, American Council on Germany
Panel I: Closing the Gap: Can Europe’s Economy Finally Catch Up with the U.S.?
This panel examined the economic impact of the results of the November elections in the United States. Panelists were John Lipsky, Johns Hopkins University School of Advanced International Studies; Alexander Privitera, Commerzbank; Jen Olson, Peck Madigan Jones; and Susan Fratzke, Migration Policy Institute.
There are three major current challenges to the global economy. First, the G20 is not driving international cooperation as it should be and does not have a cohesive response to Brexit. Second, the difficulties in the Chinese economy and the regional challenges in Asia are important issues for international cooperation. Third, international trade agreements like TTIP or TPP are less successful than expected. The political risk and uncertainty following the election of Donald Trump adds further challenges. Trump’s campaign promises of fiscal dominance in the United States might lead to inflationary pressures, but it is hard to predict which of Trump’s economic plans will become policy.
There are many possible responses Congress to the president-elect’s economic policy ideas. Since not all Republicans in Congress agree with Trump’s views, Republicans will face a debate within their own party on the debt deficit. In order to pass legislation, the party is also dependent on votes from Democrats. In addition, an attempt to revive TTIP in Congress will be unlikely as President-Elect Trump favors bilateral agreements. One of the key issues during the election was immigration. President-Elect Trump’s main focus is on deportation of undocumented immigrants and the limitation of arrivals from particular countries. The different opinions on how to handle refugee resettlement will create a source for tension in the global network.
Leaders in Germany and the United States have to be aware that the growth in Europe is so slow because of the lack of investment. German chancellor Angela Merkel will have to make sure that Germany is not sidelined if President-Elect Trump rearranges his priorities to Great Britain after Brexit. Should President-Elect Trump manage a successful turn in the U.S. economy during his time in office, it will be perceived as a signal for policy change by certain groups in Germany and Europe as well. Europe’s and the United States’ approaches to stimulate economic growth are different, which leads to an increasing divergence between the Unites States and Europe. Since Trump’s staff of advisors is quite small and not all positions for the new administration were filled by the time of the panel, it was hard for the panelists to make any predictions on how the president-elect will invest in the transatlantic relationship. Europe and the United States face the same challenges but make different choices in how to deal with them. Therefore, the transatlantic relationship and the economic growth on both sides are hard to predict.
Panel II: Prioritizing the Partnership: German-American Relations and the 45th President
This panel focused on the impact of the new president Donald Trump on foreign policy challenges facing both the United States and Germany. Panelists were Susan Eisenhower, President of the Eisenhower Group, Inc.; Jürgen Hardt, Member of the German Parliament (CDU); Ambassador Wolfgang Ischinger, Chairman of the Munich Security Conference; and Ambassador Cameron Munter, Chief Executive Officer and President of the East West Institute. Various topics were discussed regarding the influence the of the president-elect on future challenges.
The United Nations Security Council has been more or less ineffective during the last years when it comes to the Syria conflict. Even purely humanitarian resolutions were not approved by the members of the Security Council. President-elect Trump announced he will look forward to dialogue with Russian president Vladimir Putin, which could have positive effects in terms of finding a solution for the Syria conflict. Other key national security negotiations and conflicts could be affected by the president-elect’s policies. He openly disagrees with the recent Iran nuclear deal and has threatened to dismantle it. It is also unclear if he would advance a successful negotiation between Israel and Palestine or if he would become involved in many conflicts within Africa.
President-elect Trump’s commitment to the goals expressed in various international climate treaties such as the UN’s Agenda 2030 and the Paris Agreement is questionable. Even though there has been a back and forth on his stance toward climate politics, it is no secret that it will not be a priority for him. He will most likely support the coal industry in the United States to save jobs in this sector. The Agenda 2030 needs the support of the United States and its cooperation with other countries and governments. Fulfilling the goals works toward solving some of the most challenging problems the world is facing right now, especially in terms of migration and the beginning of climate refugees. This is why American social and environmental responsibility is needed more than ever. When it comes to the president-elect’s understanding of climate change, the panel pointed out how much effect framing has in this context. Changing the narrative from climate change to technological innovation may be helpful in terms of gaining his support.
In her speech congratulating Trump, Chancellor Merkel made clear that she wants a close and cooperative relationship on the basis of shared values. It is hard to make any predictions concerning the future of the transatlantic relationship, since Trump is known to be unpredictable. With upcoming elections in the Netherlands, France, and Germany, Trump’s performance in the first months of his presidency might be decisive for the results. If Trump does not succeed or keep his promises, the population in Europe might realize that populism is a bad alternative and votes for the extreme parties will decline.
As already pointed out, Merkel referred to the shared values when talking about the future of the transatlantic relationship. They have been the basis of the relationship and are of essential importance concerning world politics. Losing those values would harm the position of being the “good” in the world. There are many open questions concerning the likelihood of cooperation on the base of shared values, especially regarding the rhetoric of the president-elect on the campaign trail.
This might be the biggest moment of uncertainty in the transatlantic relationship. It is of great urgency to eliminate the key uncertainties. Trump should send a message to the Baltic States. He has to assure them that he will stick to NATO and Article 5. The Baltic States need this assurance. Another key point is the role of free trade. A “great America” can only function through free trade—Trump should acknowledge that and also mention it to the public.
Not only will the transatlantic relationship be challenged, but also the U.S.-Russian relationship might change tremendously with the new president. It remains to be seen whether this will be an opportunity or a threat. Potentially, Trump could distance himself from the common Western position toward Russia and the core values connected with it. Within the panel, a new approach was perceived as a chance since the current strategy—the use of sanctions—is not yielding the desired results. Russia has always risen to the kind of challenges like sanctions. The more pressure used against them, the tougher they reacted and the more defined they became. The new approach requires a review of understandings about what the West/NATO wants from Russia, what the West wants to prevent, and what can be done jointly with Russia.
Before knowing that Trump will be the next U.S. president, Europe was aware of the fact that they would be expected to share more of a burden concerning foreign and security policy. The new U.S. government will push Europe harder to take on this new responsibility. If the European countries find a way of pooling and sharing their forces, knowledge, and abilities, they could master the task. This might demand for the creation of synergy effects, but most probably also for a higher deficit spending.
There is another problem the U.S. and many European countries face: The elites have failed to understand what the public wants, feels, and fears. Public opinion and social issues in both countries show similarities, which gives room and opportunity for a joint approach to detect, analyze, and solve the issues within the societies.
All in all, the election results are a moment of an opportunity. There are uncertainties which need to be addressed. The momentum of the upcoming change should also serve as a chance for a new transatlantic narrative. It needs to be developed and echo within the different societies. European leaders should seize the opportunity to work with the new U.S. president to advance the transatlantic relationship.
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