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John Shattuck

The US needs to reengage with Europe

CHRISTOPHER SERRA FOR THE BOSTON GLOBE

BUDAPEST

The Middle East and Asia dominate President Obama’s daily foreign policy briefings, but a region of the world closer to home should be getting more of his attention. The economic and political crisis in Europe poses a direct threat to the United States.

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The United States and the European Union are the largest mutual stakeholders in each other’s economies, global partners in international security, and, despite differences in perspective, supporters of a system of shared values. But the EU today is a fractured behemoth, and US interests in Europe are increasingly at risk.

Until recently, the EU was a remarkable success story. With crucial early support from the Marshall Plan, Europe was rebuilt from the ashes of the Second World War, developing a common market that grew into an economic union based on free enterprise, democracy, and open society.

The EU was able to expand rapidly in the 1990s, thanks to German reunification, a strong common currency, and robust economic growth. But the financial crisis and the economic contraction that followed proved catastrophic, reversing two decades of integration and creating a multi-speed Europe now in danger of breaking up unless strong fiscal controls are established at the center.

The European Central Bank and other EU institutions are now perceived by many European governments as threatening national sovereignty. Tensions are reflected in the financial markets, widespread and sometimes violent European protests, and political gridlock in Brussels, Berlin, Paris, London, and other capitals trapped by their own austerity policies. As the crisis continues, nationalism, xenophobia, and increasingly powerful right-wing extremism are emerging across the continent.

The EU crisis cannot be solved by Europe alone. As Europe’s principal geopolitical partner, the United States has a huge stake in the EU’s future. It also has substantial economic and security leverage.

US investors are responsible for more than half of all direct global foreign investment in the EU. Nearly half of all the assets of US foreign affiliates are invested in the EU. The United States is the EU’s largest trading partner. Equally important, as the creator and managing partner of NATO, the United States is a huge co-investor in European security. NATO has protected the security interests of both the United States and the EU over the last two decades in Bosnia, Kosovo, Iraq, and Afghanistan.

The intractability of the crisis has made Europe more receptive than usual to US engagement. But a widespread perception among Europeans is that the United States has “pivoted” toward Asia, is preoccupied by its own fiscal challenges, and no longer interested in Europe’s problems. This perception should be quickly dispelled by a series of decisive low-cost actions early in the second Obama administration.

The most effective way for President Obama to reassert US interests in Europe is to appoint officials with European experience to key positions in Washington, Brussels, and European capitals. This will raise the visibility of US representation in EU institutions while broadening and intensifying the consultative process begun by the Treasury and Commerce Departments during the first Obama administration.

The United States should use its economic leverage to press European governments to accede to stronger EU fiscal controls and less stringent austerity policies. Equally important, the United States should reinforce its shared values with Europe by supporting EU measures to combat racism, xenophobia, and extreme nationalism.

It is time to reorient US security support in Europe toward the Mediterranean and other border NATO countries. This would have the dual effect of providing a stimulus for southern European states suffering most from the economic crisis, and shifting security resources in response to growing vulnerabilities to the turbulence in North Africa and the Middle East.

To rebrand American policy toward Europe, Obama should return to Berlin. European leaders have spoken often about the importance of saving the EU, but their voices have been tempered by national politics. A US president popular in Europe and backed by substantial economic and security leverage can make a case for the European Union that will resonate across borders. To reinforce this message, the United States should expand its student and professional exchange programs with EU countries and the visa waiver program for EU citizens.

Markets must be reassured that the United States has not pivoted away from Europe. Open society leaders in Europe need reassurance that they are not alone in their struggle. And European citizens, especially minorities, need to hear that never again should Europe be allowed to fall prey to destructive tribalism.

John Shattuck is president of Central European University in Budapest. He served as assistant secretary of state for democracy, human rights, and labor and US ambassador to the Czech Republic in the Clinton administration.
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