Fresh Start or False Dawn? Prospects for U.S.-German Relations in the Post-Merkel Era

The pieces in U.S.-German relations are in flux. The Biden administration has been clear that it wishes to rejuvenate America’s relationship to its European partners, while the incoming “traffic light” coalition in Germany creates an opening for change in German foreign and security policy. At the same time, expectations of a significant boost to U.S.-German relations can easily be overstated. Structural differences in outlook between the United States and Germany on major transatlantic issues will likely persist, and both governments will be preoccupied with difficult domestic challenges. What are the prospects, under these circumstances, for U.S.-German alignment on pressing international problems, such as relations with China, European security, or climate change? The seminar will discuss initial findings from a research project that seeks to map areas of foreign and security policy convergence and divergence between the Biden administration and the next German government. The discussion builds on more than twenty interviews with foreign and security policy experts in Washington, DC.

Event Summary

The goal of the research project was to explore the Biden administration’s thinking about German-American relationship, especially with the new traffic light coalition in place in Berlin. The project also maps areas of convergence and divergence on the agendas of each administration. The Biden administration has sent strong signals that it wishes for strong cooperation with Germany. The foundation for the next several years of transatlantic cooperation is being laid now, and it is important to understand mutual transatlantic priorities and expectations.

The Biden Administration’s Priorities

The Biden administration is focused on domestic priorities, and foreign policy is results-driven. The slogan “Foreign Policy for the Middle Class” is best seen in the administration’s trade policy. The administration isn’t driven by protectionist instincts (as some in Europe view it) but the need to make trade policy work for the American middle class. The future of transatlantic relations must be seen through the prism of Biden’s tight room for maneuver for his domestic priorities. The administration wants to see returns on its outreach to Europe and full engagement with its agenda, rather than hedging bets that Biden will lose reelection in 2024.

Germany has a high profile in Biden’s team, and it is unlikely to see a friendlier American administration. Germany is seen as the dominant economic and political force in Europe, and the Germany expertise among high-level appointees in the administration runs deep. However, the administration views managing China’s rise as its biggest priority, and there has been some lack of coordination between the European and Asian offices.

The Biden administration has a positive outlook for the new German government. The view is that policies of the Biden administration and traffic light coalition will be more aligned, and the new government will be less wedded to the legacy thinking of the Merkel administrations. Chancellor Scholz is seen as a pragmatist and a mix between continuity and prospect for change. There is more concern about the more radical wing of his party, the Social Democrats (SPD), and their views on Russia, China, NATO, and nuclear sharing. There is hope that Scholz won’t be affected by the more radical wing of his party and will pursue a centrist course. Much hope in the administration is pinned on the Greens, since they take the most aggressive stance on China and Russia. However, there is doubt that they can follow up their rhetoric with action or that they will actually have the power to do so. The Free Democrats (FDP) are seen as a dedicated transatlanticists but aren’t viewed as foreign policy players.

There is a clear expectation that Germany should step up on the international stage and adapt their strategic thinking to a changing geopolitical environment. A key source of U.S.-German friction was the frustration that the previous government was reluctant to see disruption and change on the international stage. Hope is that the new coalition will adopt a different mindset.

China

China is by far the top foreign policy priority of the administration. There is bipartisan agreement that China is the United States’ long term strategic adversary. The United States was often disappointed with Germany’s soft approach to China and prioritization of business interests. The top U.S. expectation of the new coalition is that it takes a more strategic approach to China. The administration’s expectations for Germany can be categorized in three baskets:

1. Language: The administration would like to see tougher rhetoric on human rights, values, and democracy, plus Taiwan and meddling in Europe. The coalition agreement does take a clear stance on these issues and acknowledges a need to work with transatlantic partners, so this issue has become less contentious.
2. Political signaling: Nobody expects Germany to make a military contribution in the Indo-Pacific. But the administration would like to see Germany send political signals in peacetime that would affect Beijing’s calculus in the South China Sea and show President Xi Jinping that he can’t play allies against each other. The deployment of the Bayern frigate in South China Sea was good, but it was undermined by the port call in Shanghai.
3. Trade and technology: Given Germany’s economic power in Europe and the world, this is where it matters most. There is a clear sense that German industry’s position toward China is evolving. Germany’s tougher stance on investment screening is a positive signal, but the United States hopes for more engagement on a whole bundle of issues presented at the Trade and Technology Council (TTC).

Russia

U.S. criticism toward Germany on Russia is similar to those on China—too soft on rhetoric and too focused on business interests. There has been some change in Germany, but the new coalition agreement does not take as hard a stance on Russia as it does on China. There are two key expectations that the Biden administration has for Russia:

1. Be more engaged diplomatically, not just in Ukraine, and
2. Be prepared to endorse more muscular sanctions to deter military action in Ukraine.

Most controversial issue between the United States and Germany is the Nord Stream 2 pipeline—on which the new coalition agreement is suspiciously silent. It remains a difficult topic in the American domestic rhetoric. The United States expects action from Germany if Russia does weaponize energy in Ukraine.

Germany’s Role in Europe and Future of the EU

The United States has two major expectations:

1. Germany should use leverage in EU to keep the EU together. The Biden administration sees the EU as an important actor on world stage and is unusually pro-EU. Germany should encourage heightened engagement in the EU neighborhood and take the lead to stop democratic backsliding. This aligns with the new coalition agreement, where the government advocates for a stronger EU in the world.
2. Biden is not opposed to European strategic autonomy (unlike other administrations) but wants to see how it can strengthen transatlantic security. The Biden administration wants the Scholz government to lean into this debate and hopes it will result in stronger EU engagement in its neighborhood.

NATO and Defense

The most notable issues are defense spending and nuclear sharing. The administration expects that spending increases continue, but it’s not a make-or-break issue. Biden has a more holistic view of burden sharing, and while that has resulted in domestic criticism it creates alignment with the traffic light coalition. The agreement doesn’t mention the 2 percent target at all and creates a new goal of spending 3 percent of GDP on foreign priorities, which also includes diplomacy and development.

The nuclear sharing debate within the SPD has not inspired confidence in Washington, but there is not an expectation that Germany will explicitly leave the nuclear sharing agreement. The coalition has pledged to replace nuclear-capable aircraft.

Conclusion

Findings confirm that on programmatic level, the prospects for close relations look better than for quite some time. There is growing alignment on how the two sides can come together on a range of issues despite spoilers. There are still “known unknowns” that could have an effect on this growing alignment:

1. Domestic politics on both sides can work to undo alignment and undercut cooperation.
2. We need to see how the new German coalition actually operates: who has control of portfolios, how will dynamics play out, how will obvious tensions between partners be resolved?
3. Major international crises like Ukraine or Taiwan could affect convergence, and it is uncertain how resilient the transatlantic relationship can be in the face of such crises.

Supported by the DAAD with funds from the Federal Foreign Office.