Europe retaliates and the transatlantic split widens

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The European Union (EU) retaliatory tariffs on a series of American goods, including peanut butter, motorcycles, bourbon, orange juice, sweetcorn and others, kicked in on June 22. The imposed duties on American products are worth $3.3bn in a tit-for-tat response by Brussels to the Trump administration’s unilateral imposition of tariffs on aluminum (10%) and steel (25%) back on March 23.

The EU Trade Commissioner, Cecilia Malmstrom, said that “the rules of international trade, which we have developed over the years hand in hand with our American partners, cannot be violated without a reaction from our side.” She argued that the EU was “left with no other choice” to impose tariffs on US products. Jean-Claude Juncker, president of the European Commission, said that the decision by the US to impose tariffs “goes against all logic and history.” In addition to the immediate tariffs, the EU seized the World Trade Organization (WTO) to challenge the US measures.

The US under President Trump is not at its first spike of tariffs on targeted foreign goods based on national security ground. Aside from the steel and aluminum tariffs, the US imposed a 20-30% tariff on washing machines and solar panels last year. It is as well discussed to impose a 25% tariff on over 800 Chinese goods. Trump seems to believe that the world is taking advantage of the US and that free trade is not being fair to the US. His sole argument is based on the reading of the US trade balance. If there is a trade deficit, the US is losing; if there is a surplus, the US is winning. Trade policies are more complex than what it is being portrayed in a tweet. The world, in particular US allies, has already responded to US ensuing the tariffs on steel and aluminum as listed in the table below.

Source: Amy Cheng, Humza Jilani, Keith Johnson, Amy Mackinnon. 2018. “State of the Trade Wars Tracking U.S. President Donald Trump’s tariffs — and the retaliatory measures other countries are taking.” Foreign Policy. June 21. (here)

Tariffs on auto imports?

In a very trumpian fashion, the American president went on on Friday by threatening to impose a 20% tariff on all U.S. imports of European Union-assembled cars. His message, via twitter, read “If these Tariffs and Barriers are not soon broken down and removed, we will be placing a 20% Tariff on all of their cars coming into the U.S. Build them here!” The threat of imposing tariffs on cars is not new as a month ago he instructed the Department of Commerce, led by Wilbur Ross, to launch a probe into whether auto imports pose a national security threat.

Trump and his associates have used overtime the Section 232 of the Trade Expansion Act of 1962 in order to increase tariffs on ground of national security. The same rationale will potentially be used for tariffs on auto imports. The justification and connection between national security and tariffs was made by Wilbur Ross during a recent interview, wherein he said “National security is broadly defined to include the economy, to include the impact on employment, to include a very big variety of things.” He continued claiming that “Economic security is military security. And without economic security, you can’t have military security.” However, most of the tariffs are affecting traditional US allies, which happen to be NATO members and closely working on defense and security cooperation. Mr. Ross’s justification does hold any serious ground and is simply trying to hide basic protectionist policies being national security.

Congress could regain the control of decision-making on tariffs if the Republican establishment, holding the majority in the House and Senate, were committed to free trade and sound economic and trade policies. Earlier in June, republican and democrat lawmakers mentioned a plan to introduce a legislation that would force President Donald Trump to obtain Congress’ approval before imposing tariffs on national security grounds. Until the midterm elections, it is difficult to imagine the approval of such legislation by the Congress.

The current rates of tariffs for imports between the US and the EU are divided into two categories: for cars, 2.5% US import tax compared to 10% EU import tax; and for light trucks and SUVs: 25% US import tax compared to 10% EU import tax. The American president always focuses on the tariffs for cars and never on light trucks. He has been picking on Germany and its successful automobile industry. But he has failed to recognize the investments made by the three leading german companies in building assembly plants in South Carolina (BMW and Daimler), Alabama (Daimler), and Tennessee (Volkswagen). In 2017, 38% of 854,000 cars build in the US were sold in the US and over 500,000 were exported. With regards to employment, 116,500 jobs in US were connected to german auto-makers: 36,500 working at auto-maker plants and 80,000 as suppliers.

What would the impacts be for the US if the US president were to impose such tariffs? The Peterson Institute recently released a report on the potential impacts of a 25% proposed tariffs in auto imports. The report argues that the production in the industry could drop by 1.5% and that it could cause 195,000 US workers to lose their jobs over a 1-to-3 year period. In case of retaliation in-kind with tariffs by foreign countries on the same products, production would fall 4%, 624,000 US jobs would be lost, and 5% of the workforce in the auto and parts industries would be displaced. The ripple effects of such tariffs could have disastrous consequences for states hosting assembly plants in the long-term. The latest risk assessment by Airbus addressed to the UK government regarding the uncertain future around Brexit should be carefully read by US lawmakers and Trump associates when deciding on imposing tariffs or not. Multinational corporations hold quite a strong leverage in the decision-making process of trade policies.

Rocky transatlantic relations

Again, as argued in previous analyses, the future of transatlantic relations appears unstable and rocky. Several points shall be addressed reflecting on US treatment of historical allies and the future of the liberal order. First, The Trump administration has demonstrated over and over its decision to split with and humiliate America’s traditional allies. The message addressed by the American president and members of his cabinet, in particular Peter Navarro, towards the Canadian prime minister post-G7 meeting as well as the continuous undermining of the German chancellor illustrate Trump’s modus operandi. Per Wess Mitchell, US Assistant Secretary of State for European and Eurasian affairs, the Trump administration is implementing a “strategic renovation” with traditional allies. President Trump has made a point to undermine his German counterpart, Angela Merkel. She was one of the closest partners of President Obama, is leading the most stable and largest European economy, and has not shied away to defend the liberal order. The appointment of Mr. Grenell as US Ambassador to Germany, who has broken protocol on two occasions, confirms it. Mr. Grenell in an interview with Breitbart said “I absolutely want to empower other conservatives throughout Europe, other leaders. I think there is a groundswell of conservative policies that are taking hold because of the failed policies of the left.” The Trump administration is seeking to undermine and destabilize the German chancellor.

By looking at the trends and rhetorics (which can shift very quickly as demonstrated by the change of position by Trump towards the North Korean dictator), a trade war is quite an eventuality. For the EU, trade has been the core dimension of its external policy and international presence. The EU sees multilateralism and free trade as one of its most successful policies. Furthermore, the EU is at a crossroad with the continuous rise of populist forces gaining traction in core EU countries, such as recently Italy. The EU ought to defend its interests and cannot cave in to foreign pressures, otherwise it would play in the hands of the Orban, Salvini and Le Pen of Europe. And last, the European market is one of the richest, largest, developed and influential in the world. By the weight of its market, the EU shall not shy away from direct confrontation with the US. As per Charlemagne of The Economist, the EU has three strategies in hand to chose from: capitulation, resilience, and containment. Resilience is the most likely strategy at this period of time.

Lastly, the main issue with regards to trade is China, and it has remains unaddressed. Both the US and the EU agree with the fact that China, since joining the WTO in 2002, has not played by the rules. The US could have worked with the EU and utilized the common procedures and processes, the international trading system. However, Trump said it on the campaign trail, and is now doing it while in office, the rules-based global trading system is being portrayed as the cause of American demise. Trump wants a trade approach based on bilateral deal-making, transactional relations and only fair for the US. Donald Tusk, the president of the European Council said in Canada, “the rules-based international order is being challenged, quite surprisingly… by its main architect and guarantor, the US.” For instance, Trump refused to sign the G-7 communiqué. For the EU, the liberal order and rules-based trading system are critical for its functioning. Cecilia Malmstrom said this clearly, “The E.U. has a responsibility to stand up for open global trade.”

The American president seems more at ease surrounded by dictators and authoritarian leaders than with traditional American allies. The affronts to the liberal order and America’s allies are beginning to add up considering his policy choice to leave the TPP, Paris deal, the Iran deal, relocate the US embassy in Jerusalem, and unilateral imposition of tariffs. Europe knows that Trump is temporary, but his continuous attacks on the liberal order will not only undermine the US position in the world but lead to a highly unstable multipolar order. “Trump’s preference for a divide-and-rule strategy produces a game” writes Javier Solana “that will create only losers.” Europe knows it, the US may have a serious headache post-Trump.

(COPYRIGHT 2018 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

 

The stamp of America First on US foreign policy

Credit: AP

What if the implementation of the tenets of America First onto US foreign policy was for real? What if Donald Trump had been consistent on telling Americans and the world, that he was serious on taking the US out of the liberal order? and, ultimately on bringing the US status down from being the centerpiece of the liberal order to a simple superpower?

Since 2017, it seems that Trump and his advisors/implementers have been working on cutting all the strings attached around the US in terms of commitments, engagements, responsibilities and duties to transform the US from the ‘indispensable’ power into a simple sovereign power. After years of trying to grasp the logic of Trump’s foreign policy, it appears to be the most likely hypothesis at this point of time.

For two years, foreign policy experts and American allies have been trying to understand the logic of Trump’s approach to foreign policy. And based on the structures, heritage, norms and values of the post-World War two order, Trump’s decisions are incomprehensible. For instance, the departure of the US from the Paris climate deal, the different rounds of tariffs and quotas (washing machines, solar panels, aluminum and steel, and potentially car tariffs), the withdrawal from the Iran deal, the visceral despite for the European Union and deep support for Brexit, the departure from the Trans-Pacific Partnership negotiations, the lingering NAFTA talks, and lately the relocation of the US embassy to Jerusalem are all a direct affront to the trust of allies. These radical shifts are not increasing American security, not advancing American interests and undermining global security.

What does that tell us? Donald Trump wants nothing to do with the liberal order and believes that the US can be better off alone dealing on bilateral basis and imposing its weight and will onto others. Trump and his administration may appear to see a success in this approach considering the limited response by the Europeans (still at awe by the permanent affront of the liberal order), and a mild reaction by China (so far).

Donald Trump believes, as a large segment of the American electorate, that the US has no business in playing the role of the world policeman. The international institutions, designed post-1945s, making the liberal order are in fact limiting the American sovereignty and national interests. The multilateral system orchestrated via the United Nations system, the World Trade Organization, and the multitude of regimes undermines the way the US can act. In December, Susan Rice, Obama’s national security advisor, wrote “these omissions [of the liberal elements in Trump’s NSS] undercut global perceptions of American leadership; worse, they hinder our ability to rally the world to our cause when blithely dismiss the aspirations of others.” Barry Posen summarizes it into the argument that Trump’s grand strategy is “primacy without a purpose.”

This approach and shaping of American foreign policy are extremely dangerous for the US and the world at large. Donald Trump inherited a strong economy and a relatively stable global order. The US is not involved in any major crises, at the exception of Iraq, Syria and Afghanistan. Donald Trump did not have to save the American and world economy the way his predecessor needed to respond. These domestic and geopolitical realities have in fact created an illusion for this administration that has not proven itself in addressing any critical crises. The Trump administration feels almighty when it has in simple terms only been in cruise-control mode. Most of the crises faced by the Trump administration are in fact self-inflicted, as proven by the sudden cancellation by Donald Trump of the upcoming Singapore summit between the US and North Korea.

If Donald Trump continues on this trend and truly takes the US out of the order designed by the Americans and Europeans post-1945, he will not only launch the US into a motion of de-credibility of the US, weaken the liberal order, and simply downgrade the US into a regular superpower. Here are the dangers of such trend: first, history has taught us that multipolarity is greatly instable. The probability of war at a regional and global scale would increase. Second, the challenges ahead are becoming more global and complex to solve than ever before. The case of climate change, nuclear and chemical proliferation, free-trade, pandemics, mass migration, and stability of the financial system all require a network of institutions and regimes as a platform of discussion and interaction among states. These multilateral platforms permit to align interests, deepen cooperation and coordination and design mechanisms to implement and enforce agreements and policies. One country, as economically and militarily powerful as the US today, cannot solve any of these issues alone. Third, in his quest to greatness (almost like Don Quixote) Donald Trump will simply undermine the status, influence and power of the US and downgrade it to a superpower. Ironically, a long-term decline in influence and power will require the US to increase its alliances to balance its progressive global decline. That is the story of past hegemons. Fourth, this abrasive style may alienate once and for all American allies. The comments by President Donald Tusk at the recent EU summit in Bulgaria speak volume about the state of transatlantic relations. He said “We are witnessing today a new phenomenon: the capricious assertiveness of the American administration. Looking at the latest decisions of President Trump, some could even think, ‘With friends like that, who needs enemies?’”

The US foreign policy under this Trumpian paradigm is due to a lack of understanding of the past 70 years and world history, the arrogance of inheritance of such power, and ideology. Furthermore, the Republican establishment in power and control of the Congress (House and Senate) seems to agree with the current direction of US foreign policy considering the lack of opposition (at the exception of Senator McCain). The decline of the US has been projected for quite sometime and it certainly won’t occur overnight. However, the trends these last years of this administration confirm to American allies and the world that analyzing Trump’s foreign policy decisions based on past paradigms will lead to more confusion than understanding. Trump’s America first is for real and could have lasting negative impacts on the US, world affairs and global security.

(COPYRIGHT 2018 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Paradise Papers – A Story of the Disdain for Democracy by the Transatlantic Elite

The “paradise papers” shine a light on the mechanisms utilized by global elites and corporations to avoid paying taxes. These latest revelations on the dark mechanisms of global finance, known as the “paradise papers,” emerge a little more than a year after the “panama papers.” But a clear distinction must be made between the two giant leaks: the panama papers were about illegal financial activities, while the paradise papers expose the legal financial and fiscal instruments available to the global elite and corporations.

Over a period of a year, 13.5 millions documents were analyzed and verified by the International Consortium of Investigative Journalists (ICIJ) and its 96 partners, such as the BBC, The New York Times, and Le Monde. These revelations are based on a leak of documents in 2016 shared to the german newspaper Süddeutsche Zeitung. This year long investigation has permitted to expose the complex mechanisms of fiscal optimization utilized by corporations and the global elite (see here the documentary by Vice on the investigation). The documents are composed of three major categories:

• 6.8 million internal documents belonging to the international offshore law firm, Appleby, located in Bermuda with branches in ten tax heavens,
• 566,000 internal documents from the law firm Asiaciti Trust in Singapore,
• and 6.2 millions documents from confidential registries in 19 tax heavens.

The paradise papers are particularly damaging for the transatlantic global elite involved in this massive tax evasion. The “paradise papers” are in fact the obvious demonstration of a total disrespect of democratic and social values by a segment of the transatlantic elite. As argued by an editorial of the french newspaper Le Monde, this mechanisms “endanger the principle of the equality of all in front of taxation.” Among them, so far the Queen of England, Elizabeth II, members of Trump and Trudeau’s entourages, and other wealthy individuals appear to have had prior or ongoing activities to avoid contributing to national taxation.

Politipond argues that the “paradise papers” are even more scandalous than the “panama papers” considering the current transatlantic political, economic, ideological and social climate. The “paradise papers” ought to be put into perspective along four points.

The first point ought to be political. The transatlantic political class has increasingly been more connected to, or simply is, the global elite. In the US, Donald Trump was brought to D.C. on the pledge to ‘clean up the swamp’ and on a variety of ‘America first’ slogans. Even though these rhetorics gathered great appeal on the campaign trail, the composition of his administration tells a completely different story. These latest papers show that three leading figures of the Trump

@Tom

 administration, Wilbur Ross, Secretary of Commerce, Rex Tillerson, Secretary of State, and Gary Cohn, Economic Advisor at the White House have or are utilizing these optimization mechanisms for personal profits. Other individuals and influential republican donors, such as Robert Mercer and the Koch brothers, appear in these documents. So far the most damaging allegations go against Mr. Ross, whom is potentially facing a conflict of interests, as he is still retaining “investments in a shipping firm he once controlled that has significant business ties to a Russian oligarch subject to American sanctions and President Vladimir V. Putin’s son-in-law.” This financial connection does not imply that Mr. Ross is a piece of the Russian puzzle involved in the meddling of the 2016 American elections. To the contrary, Ross’ spokeperson claimed that Mr. Ross has been supportive of the American sanctions against Russian entities. But this connection demonstrates an absolute lack of morality in the behavior of some members of the American elite and government officials. In a ‘normal’ democracy, Mr. Ross should have already provided his letter of resignation to the President (watch here Mr. Ross’ response).

The second point is economic. The Euro-Atlantic community has been confronting a considerable decline since the 2008 financial crisis. If the US has recovered quicker than European economies, the economic crisis has considerably affected a wide segment of the transatlantic citizenry. In both American and European economies, taxpayers were the one to fit the bill to bail-out, rightfully so, the banking and financial sectors in order to avoid a complete collapse of the transatlantic economies. But since then, the stock market, particularly in the US, has done fantastically well, while transatlantic wages for the middle class have stagnated. Unfortunately, strong financial data and performance have not translated into the real economy. Taxation is an important equalizing instrument in the hand of governments in order to finance the state and social programs among others.

The third point is related to ideology. These allegations contradict the push occurring in the US and some countries in the EU, lately in France with President Macron, to promote trickle down economics, meaning tax cuts on the wealthy, in order to promote investment. The concept/theory implies that income and capital gains maintained thanks to tax breaks and financial benefits to wealthy individuals and businesses permit to stimulate economic growth. This theory was, once more and recently, demonstrated as fantasy by the Kansas experiment.

In the US, the blame usually falls on the shoulders of the poorest and weakest. Elected officials have historically blamed welfare programs, such as food stamps, in order to explain the ever expanding  deficit. In this case, the American elite is demonstrating that in a country wherein taxation is not the highest in the world, fair contribution via taxation is not as automatic as expected. The New York Times reports that “Americans — companies and people — dominate the list of clients.” Among these American corporate giants, Apple, Nike and Uber, have avoided taxes legally through creative bookkeeping.

Helping the wealthy getting richer through offshore maneuvers is not a “benign benefit,” said Harrington, a Copenhagen Business School professor. “When the rich get richer, the poor get poorer, because individual wealthy people are not paying their fair share of taxes.” The inequalities within the Euro-Atlantic societies are increasing and the gap is becoming wider between the ultra-wealthy and the middle class.

In Gold, 2017

As illustrated above in the chart from an analysis published by Chicago Booth Review, the gap is not only wider, but the income of the bottom 50% earners has not increased in the last 34 years and the middle 40% only show a rise of its income by 42%. A 42% increase is not small, but compared to a 121% for the top 10 and 205% for the top 1%, it is quite minimal. In addition, over the last 30 years, the quality of the American welfare state has declined forcing Americans to increase their spending on their healthcare spending. Income inequality has considerable grown wider in the US since the 1960s. For instance, a recent report explained that “the richest 1% of families controlled a record-high 38.6% of the country’s [the US] wealth in 2016.”

Last but not least, the greatest consequence is social. Tax evasion, in this case legal, undermines that basic structure of Euro-American democratic societies. These directly undermine the basic ‘social contract’ and fabric that citizens have with their fellow citizens and governments. Taxation for too long has been framed as a punishment, when in fact it is an individual contribution, a civic duty, to the construction, physically and psychologically speaking, of the society, country and ultimately the defense of the public good. In a Western democracy, citizens are expected to contribute. But as it was demonstrated by the Trump campaign and rhetorics, a significant number of American voters agreed and supported a man proudly exposing his successful cheating (he has yet to release his taxes, which could prove the contrary). In an even more grotesque move, Mr. Trump pushed the argument further claiming that because he had successfully cheated, he would be the best person to ‘fix it.’

So far, we are only in the first weeks of the release of the documents. The “paradise papers” demonstrate the facility for the global elite to hide their wealth in all legality and impunity in tax havens through shell companies or other complex mechanisms. It is difficult to image Euro-Atlantic states pushing for an end to this legal loopholes, when states are increasingly in the hands of the global elite. “It won’t be lost on wealth managers and those in the offshore industry,” Professor Harrington said, “that we are reaching sort of French Revolution levels of inequality and injustice.”

In the case of Europe, the EU and other international organizations such as the OECD (listen here in French the recent interview of Pascal Saint-Amans, Director, Centre for Tax Policy and Administration at the OECD), have put pressures on offshore havens in order to reform their laws. As argued by Samuel White of EurActiv, the “paradise papers” may “provide the impetus the EU needs to finalise an effective tax havens blacklist and end tax competition between EU member states.” In the case of the US, the Congress has had no desire to address these issues in recent memory and the data in this latest leak demonstrate it. The Euro-Atlantic societies need to wake up and start pressing elected officials in order to tackle these systemic tax avoidance mechanisms. These inequalities are directly at the heart of the problem of the Euro-Atlantic societies seeking for alternatives in the extremes. Surprisingly enough, these allegations have not had the impacts as one would have expected. Impunity can only continue if the citizenry is consenting.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

 

The Iranian Dossier – France’s Position

Shortly after the decision by the Trump administration to refuse to certify the Iran deal, and “instead tasked Congress with determining whether to take punitive action,” I was invited by the Program in Arms Control and Domestic and International Security (ACDIS) at the University of Illinois at Urbana-Champaign to provide an analysis on the French and European position regarding the Joint Comprehensive Plan fo Action (JCPOA).

Concerns that Iran may seek to develop its own nuclear arsenal once the Joint Comprehensive Plan of Action (JCPOA) expires in 2025 are legitimate. But how can one make an informed decision to decertify the deal when so far Iran has complied with the terms of the 2015 agreement signed under the UN auspice?

Politically speaking, Donald Trump, against the recommendations of his top advisors decertified the deal after having already recertified it at two previous occasions. While this decision may appeal a Trumpian base that perceives multilateral and diplomatic efforts as a form of weakness undermining American grandeur, a divide between the US and the Europeans is apparent regarding the survival of the Iranian nuclear deal. European counterparts, especially France, Germany, the United Kingdom and the European Union (known as the E3/EU), have not shied away from expressing their opposition to such unilateral decision by the White House.

To read the rest of the analysis, click here. 

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Sovereignty versus Voices – Thoughts on Trump and Macron’s Addresses at the UN

World  leaders are gathered in New York for the opening of the 72nd Session of the United Nations General Assembly. This year is quite unique with a series of major unknowns and new players. The 2017 session included the recently elected American president, Donald Trump, and French president, Emmanuel Macron. In addition, the United Nations (UN) is headed by a new Secretary General, António Guterres, trying to make a name for himself. If these players matter, the geopolitical context requires a concrete and thoughtful reflection on its engaging world players on a multilateral basis. Comparing Macron and Trump’ speeches permits one to reflect on the internal forces at play and visions within the liberal order at a time of growing instabilities and complex challenges.

Unknowns Ahead of the 72nd UNGA Session

President Trump was elected in November 2016 on a nationalist platform summed up in his campaign slogan, America first. Trump’s vision of the world is dire, dark and negative, requiring the US to start defending his interests and national security on unilateral basis. Historical alliances, global governance, multilateral institutions and global trade are undermining American interests and supremacy. Trump perceives diplomacy in transactional terms, wherein only the US can win. Months later, in May 2017, on the other side of the pond, Emmanuel Macron won the french presidential race by campaigning on an agenda calling for audacity and grounded on a pro-Europe and pro-multilateralism agenda. Macron’s election was perceived as the end of the populist rise beginning with Brexit and allowing Trump to win the White House. The two leaders met on a series of occasions, the first time at a NATO summit and the second in Paris for the 14 of July. Both men could not be more different, but appear to be developing a relationship.

Ahead of the 72nd session, the future engagement of the US as part of the Paris deal (global fight against climate change), North Korea, the future of the Iranian nuclear deal, and multilateralism at large remain unknown. These four issues are at the center of the global agenda due to a shift in American foreign policy since the election of Trump. Soon in office, Trump called for the departure of the US from the Paris deal and has been more than unclear about the reality of climate change. Interestingly enough, many experts were, positively, surprised by the fact that world leaders remained committed to the Paris deal despite the departure of the US. On North Korea, Trump has escalated the rhetorics, as part of his tweeting war, threatening to unleash ‘fire and fury‘ against North Korea ensuing the launch of  intercontinental ballistic missiles. With regard to the nuclear deal with Iran, Trump had used this issue on the campaign trail to undermine diplomacy and multilateralism and Secretary Clinton (whom did not finalize the deal). The Iran deal is widely perceived among conservative and republican circles as a failure, which will undeniably result with Iran becoming a nuclear power. Lastly, on multilateralism, Trump has never shied away from the fact that unilateralism and transactional foreign policy serve better American interests than complex organizations like the United Nations.

In less than a year, President Trump has managed to shape a new narrative about the instability of the international order, in particular the liberal order, and the need for the US to use military might at all costs to advance its interests (i.e. the limited bombing over Syrian and the escalation of the war in Afghanistan).

Trump-Macron Ping-Pong

The speeches of both leaders could not be more at odds. If Trump sees the world and foreign policy as a transaction and through unilateralism, Macron has expressed his support towards multilateralism and global governance. Both leaders made their debut at the UN earlier today and their respective speeches confirm the prior statement.

UN Photo/Cia Pak

President Trump’s speech (here) certainly marks a breakup with his predecessor. Trump opened his address before global leaders with a campaign tone talking about domestic matters (the growing economy, the strengthening American military and American resilience). Trump emphasized at great length the concepts of sovereignty (used 21 times in total including the word sovereign), security, prosperity and power. Regarding the way he sees American foreign policy, he underlined that the US was guided by outcomes and not ideology. “We have a policy of principled realism,” he argued “rooted in shared goals, interests, and values.” Some claimed that this speech demonstrated a return to realpolitik for the US. But half way through his speech, the American president made the following statement, “The scourge of our planet today is a small group of rogue regimes that violate every principle on which the United Nations is based.” These rogue regimes were identified as North Korea and Iran.

On North Korea, Trump used the platform to directly threaten the regime in Pyongyang claiming that the US may have no other option than “to totally destroy North Korea.” The language utilized to describe the members and leader of the North Korean regime was undiplomatic to say that least. He used this part, without mentioning it, to point the finger at Beijing. Ensuing his menace, he said “That’s what the United Nations is all about; that’s what the United Nations is for.  Let’s see how they do.” The use of the pronoun ‘they’ in the last clause indicates the disconnect between Washington and the rest of the world. It indicates that Washington has its strategy ready (use of military force), and now the members of the UN can try to find an alternative via diplomacy.

Macron’ speech (here in French) had a totally different tone. His opening sentences emphasized the core ideas, values and norms encompassed by the UN and the desire to design a new system putting human rights at its center (with a natural

UN Photo/Cia Pak

reference to René Cassin). The issues laid out by the french leader consisted of Syria, terrorism (Iraq), Mali (G5 Sahel and MINUSMA), protection of refugees, climate change, nuclear proliferation, multilateralism, and the reform of the UN (less bureaucratic and more active).

On climate change, President Macron directly responded to President Trump by expressing absolute opposition to renegotiating the Paris deal. On nuclear proliferation, Macron expressed deep concerns with the way North Korea behaves on the international stage, but rejected Trump’s reference of the Iranian deal as a bad one.

If Trump’s narrative was centered around the theme of sovereignty, the structure of Macron’s address was organized on the idea of France’s ability to hear the voices of the weakest and defending their rights and empowering them by speaking for them. Through the emphasis of voices, Macron presented France as a guardian of the weakest with French national interest being directly intertwined with global security. In reading and analyzing Macron’ speeches (for instance with his recent speech in Athens), one can identify a series of commonality: bringing France into the sphere of superpower (at least in rhetorics); similitude with an Obamaesque style of narration; deep reference and understanding of history; and a bold and global call for audacity. This style certainly breaks with the recent past of addresses of French presidents (in particular Sarkozy and Hollande) and re-unites France, for better or worst, with its gaullo-mitterrandist heritage.

Concluding with Secretary General Guterres’s comments seems appropriate. “We are a world in pieces. We need to be a world at peace.” The antipodal addresses of the American and French leaders illustrates a clear split within the West about framing critical menaces, developing a cohesive strategy, and ultimately shaping world affairs. The transition from rhetorics to actions, if any, will be fascinating to observe.

(COPYRIGHT 2017 BY POLITIPOND. ALL RIGHTS RESERVED. THIS MATERIAL MAY NOT BE PUBLISHED, BROADCAST, REWRITTEN OR REDISTRIBUTED WITHOUT PERMISSION).

Two days in Paris between friends?

Donald Trump, President of the US, responded positively weeks ago to the invitation of the newly elected French president, Emmanuel Macron, to assist at the military parade of the 14 of July. French public opinion, as well as experts, were certainly divided concerning such invitation and the presence of the American president at this national celebration. Politipond argues that such invitation was aligned with France-US interests and US-Europe interests regardless of the domestic turmoils of Donald Trump and his cabinet. Furthermore, this official visit highlighted a complex divide between the perceptions of the US, as an ally, and the perceptions of the US through the representation of his president. This subtlety was lost in translation.

Logics and reasons

Macron’s invitation has divided experts, public opinion and the media. Politico Europe probably published the article with the most telling title, Trump and Macron go from mano a mano to tête-à-tête  referencing the evolving tone of the relationship between the two men. If Macron demonstrated toughness during their first meetings at the NATO and G-7 summits in May, their third meeting on July 13-14 seemed much warmer. The claim is that Macron strategized his interaction with his American homologue in order to foster respect. Candidate and then President Trump have been consistent, as he has continuously demonstrated considerable respect to strongmen such as Russian president, Vladimir Putin, Philippines president Rodrigo Duterte, and apparently Emmanuel Macron.

Some have compared Macron and Trump as they share some similitudes. Both won outside the party system; Macron created a movement Onward! a year prior the election and managed to undermine the historical supremacy of the right and left by winning the presidential and legislative elections, while Trump running as a republican candidate certainly does not fit within the conventional ideological lines of the party. Both are framed as non-politicians, as having never ran for office. If it is true for Trump, it is not the fully the case for Macron having evolved in the highest political spheres during the Hollande presidency. But the comparison cannot go furthermore. Macron has a certain understanding of politics and the history of the French Fifth Republic as designed and envisioned by Charles de Gaulle in 1958. Macron is carefully crafting a presidential image, under the Jupiterian president aura, through a demonstration of strengthen as he is oftentimes represented surrounded by French military might. If President Sarkozy was seen as the hyperactive president, François Hollande, the ‘normal’ president, Macron is concerned about displaying and embodying French grandeur.

From Paris, especially the Elysée, the message behind this invitation was to commemorate the entry of the US in 1917 in World War one, which plays against the isolationist narrative emanating from the White House. 1917 symbolizes American engagement in the world, while 2017 may illustrate the beginning of a potential American isolationism. The relationship between the two countries is over 200 years old. The French monarchy played an important role in assisting the patriots against the British crown. Benjamin Franklin played a considerable role starting in 1776 in engaging with France, while serving from 1776 to 1778 in a commission in France in charge of getting French support for American independence. France not only recognized American’s independence but as well concluded an alliance with the 13 colonies in 1778. Skipping one century, in 1917 when the Americans joined the war on the European continent, Colonel C. E. Stanton, General John J. Pershing’s aide, famously declared before the tomb of the Marquis Lafayette, ‘Lafayette, we are here!’ This brief historical anecdotes illustrate the deep ties and historical connections between the two countries. The ties go beyond the leader at the time.

Points of Convergence?

The intervention of the two presidents in front of the press lists the series of issues wherein the US and France have shared interests: the Ukrainian crisis, the war in Syria, counter-terrorism, free and ‘fair’ trade, and the sanctity of national sovereignty. Two additional items were on the agenda of the French president. The first one concerned the COP-21 or Paris agreement entered into force Fall 2016 ratified by 153 nations. President Trump announced early on his presidency that the US would withdraw from the binding deal. European leaders, in particular Chancellor Merkel and President Macron, have been adamant about the necessity to meet the goals set-up in order to address the root causes of climate change.

The second item, an unconfirmed point, may be regarding  potential American support to the initiative of the G5 Sahel bloc – Mali, Mauritania, Burkina Faso, Niger and Chad -, planning on launching a new multinational military force led by African powers. France has been militarily involved in the Sahel region since 2013 in order to limit the regional influence of Islamist militant group. This new force will operate in coordination with French troops and MINUSMA, Mali’s struggling U.N. peacekeeping mission. Financially, the European Union has pledged around 50 million euros, while France would contribute around 8 million euros by the end of the year. The US have played a role in providing equipments, information and military support to the French. This military effort aligns with the transatlantic counter-terrorist strategy. However, no comments on this point emerged.

Beyond the 14 of July – Perceptions matter

The Franco-American relationship has not deteriorated, but the French positive perception of the US as embodied by President Trump have collapsed over night. The recent Pew research center’s report on global perceptions illustrates clearly the instant changes of attitudes towards the US at the critical juncture of November 2016, the election of Donald Trump.

The graph tells a compelling story of an immediate decline in the positive views of the US in a period of four months dropping by 15 percentage points (pp). The most damaging decline illustrates the confidence in the US presidency, wherein 74% expressed no confidence in President Trump, as opposed to 23% for President Obama.

 

This graph provides a global snapshot of the shifting perceptions between Presidents Obama and Trump. The only two countries with positive perceptions are Israel (+7pp) and Russia (+42pp). The rest of the world tends to share a lack of confidence in the American presidency held by Trump. The most critical are Sweden (-83), the Netherlands (-75pp), Germany (-75pp), South Korea (-71pp), and France (-70pp). Concerning the list of European countries above, President Obama had received strong support and a total admiration by Europeans. And this despite serious crises occurring during his mandate such as the Snowden revelations.

The last graph provides a snapshot over a longer period of time of the level of confidence in Western Europe (UK, Germany, France and Spain) in the American leader in power.

President Bush never received considerable positive reviews from Europe. But the most damaging moment of his presidency, from European point of view, was the 2003 invasion of Iraq. The UK and Spain joined the coalition of the willing, which was not the case for France and Germany. The confidence in the US grew overnight ensuing the election of President Obama in 2008. The Snowden revelations were the lowest point for President Obama and the EU-US relationship during his two mandates. But the persona of Obama was sufficient in maintaining positive perceptions and confidence in the US in Europe. As the confidence ratings climbed overnight in 2008 by ~+60 pp, they dropped by ~60pp.

Trump or Not, the US Remains Central

As advanced in the report, President Trump is perceived, especially in France and Europe, as arrogant, intolerant and dangerous. The data proves that the US-Franco/Europe relations continues to remain strong despite the occasional disagreements. Regardless of the tenant of the White House, the United States remains the indispensable nation figuring at the heart of world affairs and geopolitics. In the case of Europe, the United States is a major contributor and guarantor of European security, through NATO and parallel transatlantic defense and intelligence ties. President of France positions himself as a pragmatist, as declared during his meeting with Vladimir Putin in June. It is in the interest of both countries to maintain strong political, diplomatic and cultural ties. France has a card to play with at this time considering the fraught relationship between the German and American leaders and the ongoing turmoils in the UK. The key for the French leader is to keep a balance between cooperation and independence.

(Copyright 2017 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).

Deep Transatlantic Commonalities under Attack?

The transatlantic forces at play are under stress. The domestic forces in the United States (US), the United Kingdom (UK) and most part of Europe need to be reckoned with. The two players of the special relationship are embroiled in domestic turmoil between the Brexit negotiations and major rebuttal of long-standing policies in the US, which could have considerable impacts on the structure of Euro-Atlantic community.

The situation in France seems to be relatively stable since the election of President Macron and his victory in the ensuing legislative elections mid-June. If President Macron has demonstrated being a savvy political tactician, far from the neophyte status he received, he now needs to revitalize the French economy, reform the labor laws, reinvigorate the European agenda and integration process all under the threat of terrorism. But Macron’s election was framed as a blockade against the growth of populist forces in the Euro-Atlantic community. A return of France on the European and global stage certainly plays in favor of transatlantic relations. Now, the next chapter will certainly be the German elections in September.

So far, this year has been critical for transatlantic relations. A series of issues, from climate change to trade and defense, excluding the current Brexit negotiations, allow the world to reflect on the current challenges and potential ensuing consequences of such radical shift by Washington.

First, climate change is a priority considering global reach and impacts of a degrading environment. The US and its European partners are some of the largest emitters of greenhouse gases requiring them to lead the way in addressing environmental challenges. The 2015 Paris deal, formally known as the COP-21, sets out a global action place by limiting global warming to below 2°C and is the first legally binding climate deal. The agreement came into force on 4 November 2016 with at least 55 countries ratifying it. But on 1 June 2016, President Trump announced that the US would withdrawal from the agreement. In his address in the Rose Garden, he claimed that ‘the Paris Climate Accord is simply the latest example of Washington entering into an agreement that disadvantages the United States to the exclusive benefit of other countries.” The global reaction and especially from European counterparts was negative and critical. The issue of climate change will be back on the table for upcoming G-20 meeting.

Second, tree-trade has become a dirty word. In the European context, free and regulated trade among the 28 member states has permitted an unprecedented growth first contributing to the growth the 28 national economies. The world led by the US since the end of World War two was very much regulated around the notion that free-trade among states advantaged the US and the world, even though it certainly creates winners and losers. Aside from economic arguments, trade is one element of a state’s foreign policy arsenal, especially for an economic power like the US. The unplugging of the Trans-Pacific Partnership (TPP) with 12 pacific nations, which never counted China, in the very early days of the Trump administration is playing in favor of Beijing. By this decision, the US is playing in the hands of China. In a recent op-ed, Thomas Friedman wrote that “Beijing is now quietly encouraging everyone in the neighborhood to join the Regional Comprehensive Economic Partnership, China’s free-trade competitor to TPP, which, unlike TPP, lacks environmental or labor standards; China’s Asian Infrastructure Investment Bank; and its One Belt, One Road development project.” With regards to Europe, the future of the Transatlantic Trade and Investment Partnership (TTIP) is uncertain.

The last aspect to be highlighted is the question of defense and security. Historically the pillar of this realm at the transatlantic level has been the North Atlantic Treaty Organization (NATO). Again, the narratives on the campaign trail were that NATO was an ‘obsolete’ organization costing money to American taxpayers to finance the security and defense of free-riding European nations. Such narrative has remained in the US since Trump’s election. President Trump’s address at the NATO Summit in May, which was supposed to confirm his support and clarify his views of the alliance, failed to address the concerns of his European counterparts. The questions of free-riding and underspending by Europeans is not new and have been a frustration for past administrations. For instance, Secretary Gates’ comments in 2011 were deeply critical of the lack of political and financial willingness by his European partners.

These issues are central considering a series of factors. First, historically, the members of the Euro-Atlantic community, have agreed on shared values, institutions and norms making the liberal world order. A rebuttal of the Paris deal, the TPP (free-trade overall) and the defense alliance sends a message to the world that American longstanding commitment to global agreements is not reliable any longer. Second, the short-termism and transactional view of the foreign affairs demonstrate a total lack of overall strategy. The current administration seems to hide this lacuna by hiding behind the word of isolationism, which is not the case. Third, the Europeans, especially the Mercron couple (Merkel-Macron) between Berlin and Paris, ought to continue engaging Washington and pushing ahead long-established agenda and common policies. The responses in the US by major states, cities, universities and the public at large, regarding the withdrawal by the Trump administration from the Paris deal, illustrate deep transatlantic commonalities that need to be protected and deepened regardless of the rhetorics.

(Copyright 2017 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).

 

 

Migration, Terrorism and the Quest for Transatlantic Sanity

Photo: Reuters/Michaela Rehle

The debate in Europe and the United States has been hijacked by a simple and false amalgam that Syrian refugees are the same type of people that have bombed a Russian airliner and killed over 120 civilians in the streets of Paris. Such amalgam is resonating among the citizens of the Euro-Atlantic nations and is affecting societal unity as well as serious policy-making.

American and European Discourses

In the United States, the political debate for constructive policy-making and governance is on hold until the November 2016 Presidential elections. So far, the political debate has been framed by the large pool of Republican presidential hopefuls seeking for attention and party nomination. Because of the two-step process of American elections, candidates ought to win their party

Photo: AP

primaries in order to face the opposition in the second round. Historically, this part of the race is the most extreme and radical as each candidate (from the Republican or Democrat) wants to win the nomination from their party base. In recent decades, the base for the Democrats and Republicans has become more extreme. For such reason Republican hopefuls are tapping in the most radical rhetorics in order to get the nomination. This leads ultimately to ultra-nationalist and anti-immigration narratives highly embedded in ideologies and leaving facts on the side. The current leader of the Republican field, Donald Trump, has been quite tough on wanting to stop immigrants from coming into the US and even rejecting illegal immigrants currently living in the country. But the debate in the US has become even more radical ensuing the terrorist attacks in Paris. Now Governors of the states of Florida and Georgia have both claimed that they will be refusing to welcome any Syrian refugees. First of all, immigration in the US is a federal matter, so that would go against federal policies. Second, the process to get asylum in the US is extremely difficult, long and thorough.

Interestingly enough, Marco Rubio, Senator for the state of Florida, is even forgetting about his own history by taking a tough stand against refugees. His family flew the Cuban dictatorship as many Cubans did since the 60s. For political and historical reasons, the Cubans are among the very few to receive automatic citizenship. Cubans were fleeing a violent dictatorship persecuting individuals opposed to the regime; so are a majority of Syrians. If the 60s and 70s were one of the most tense moment between Communist regimes and Capitalist regimes, the fear was about protection of intelligence and the US responded through the implementation of virulent anti-communist policies starting with McCarthy. Today, the fear from the Syrians is not so much about intelligence gathering and spying, but rather about terrorism. In both cases, the American public has been extremely fearful of welcoming refugees from highly unstable places. Individuals like Marco Rubio taking a selecting reading of personal and national history and migration are affecting the sanctity of an important debate on proper refugee policies.

Credit: Pew Research Center. September 2015.

As illustrated by the recent poll conducted by the Pew Research Center, a majority of Americans (51%) approves the US decision to take more refugees. Within this 51%, the wide majority of Americans in favor of such policy move belongs to the Democratic Party (69%), when only less than 1/3 of Republican supporters approve it. When asked about the US on doing more, only 44% of citizens agree with such statement. If Democrats were predominantly in favor to welcome refugees (69%), only 50% of them are in favor on doing more and 35% rather stay with the current course of action. Ultimately, the current debate taking place in each party reflects very well the results of such poll. In the case of the Republicans, the main argument is to limit the number of refugees, while in the case of the Democrats it is to maintain the current status-quo. Neither parties offer a true solution on welcoming Syrian refugees.

Credit: Steve Benson

On the other side of the Atlantic, the populist and xenophobist parties of the extreme right are getting some serious leverage. Not only they are getting into power like in Poland, Denmark and Sweden, but other extreme right parties like in France are continuing their progressive ascension. The European rights are shifting towards the extreme of their spectrum in order to seek for a confused electorates. In the case of France, despite the ongoing investigations, the rights are splitting from the government  and are fighting over a ‘frighten’ and ‘powerless’ electorate. In his many speeches and addresses, President François Hollande has called for national unity and solidarity. But the rights are rejecting such unity. For instance, during the address of the Prime Minister Manuel Valls before the National Assembly, the rights booed and refused to join the current government in maintaining the national unity. The Republicans (center-right) and Front National (extreme-right) shall be called for what they are in this moment of grief, tension and uncertainty (considering the fact that the police and intelligence services are still looking

Photograph: Etienne Laurent/EPA

for terrorists and working on dismantling terrorist cells around the country): vultures. In addition, if one were to actually read and listen to the narratives of Prime Minister Valls, one would get confused about his political affiliation. The securitarian rhetorics of the current socialist government is identical to the ones used by the French rights. In a recent interview with international medias, PM Valls expressed through very tough language radical policies in order to curb the threat of terrorism (read here an article in the Financial Times). In addition, the PM and President have not shied away from repeating that ‘France is now at war’ and more attacks should be expected.

Politically, France is highly divided, much more than after the terrorist attacks in January, while socially, French citizens are in fact seeking and searching for some sort of unity and solidarity. Interestingly enough, the world has offered the unity and solidarity to French citizens more than its own political class. The demonstrations of support in the US and the UK (both on the right of the political spectrum and in opposition to economic and social policies of the Hollande’s government) have been quite humbling.

 The Quest for Transatlantic Sanity and Maturity

The threat of terrorism and its recent successes in Paris, Egypt, Beirut, Tunis (to name a few) is causing Westerners and others to reflect on a simple question: what does the future entail? How do we, as a society, avoid for a radicalization of our youth? and how do we secure our nations without violating our own democratic principles and values? The US waged two wars in Afghanistan and Iraq for over a decade, violated its democratic principles (through the Patriot Act, rendition and the use of torture). Now the French are at war and are passing laws in order to extend the state of emergency as well as a deprivation of nationality for bi-nationals. A French Patriot Act was already in the making ensuing the attacks against Charlie Hebdo 10 months earlier.

With regards to the refugees leaving their homelands in Syria, Eritrea, Somalia, Sudan and others, Europeans cannot find a common position on welcoming them and relocating them across the Union. Member States rather locked them down by closing their borders and ultimately slowly killing one of the greatest successes of the EU, the Schengen agreement (read here a previous analysis on the issue). Europeans live in the absolutely fantasy that closing and re-instituting national borders will ultimately stop the flow of migrants. In the 19th century and early 20th, an ocean and closed American borders did not stop Italian and Irish migrants to seek for an opportunity in the United States. So it is quite futile to forget about history and geographical realities.

The obvious policy response from, supposedly developed countries, should be to assume their responsibilities by welcoming refugees and letting their legal mechanisms grant asylum to the few of them. The question of the Schengen agreement should be properly addressed instead of being criticized for political reasons. The concept of Schengen, a borderless continent, is fascinating but cannot work without its members boosting up their cooperation between their police and intelligence services. Free movement of people should be guaranteed, but that does not mean that it should be a lawless continent. Criminal and terrorist networks ought to be controlled through deeper European cooperative mechanisms requiring more funding, more human and material capabilities, and naturally political will.

The two complex crises of migration and terrorism have illustrated a core reality. Our ‘leaders’ need to do more ‘leading’ and less following. Governing is a complex matter that requires vision, leadership and courage. Until our elected officials seek for perpetual reelection by only worrying of grabbing an endlessly shifting confused electorate, these complex crises will linger.

(Copyright 2015 by Politipond. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed without permission).