Tue, Feb 16, 2021

The North Atlantic community renewed: Challenges, trends, and solutions

Issue Brief by Richard D. Hooker, Jr.

Economy & Business Europe & Eurasia NATO Politics & Diplomacy Russia Security & Defense Trade United States and Canada

Golf - The 2012 Ryder Cup - The Medinah Country Club, Medinah, Illinois, United States of America - 27/9/12 General view of USA and Europe flags during the opening ceremony Mandatory Credit: Action Images / Paul Childs

With 900 million people and $1 trillion in defense spending, the United States and Europe represent by far the largest, oldest, and most capable economic and security community in the world. Today, that community is challenged by trends that, if unchecked, threaten to damage or disrupt this vital relationship, with dangerous consequences for not only the North Atlantic region, but other nations around the world. The advent of a new US administration provides an opportunity to reverse these trends, and to strengthen and improve transatlantic relations in the interests of common defense, security, economic prosperity, and global stability.

The most obvious and dangerous trend is a revanchist Russia intent on reasserting control and influence over its neighbors and regaining its place as a great power on the world stage.1“Facing Russia’s Strategic Challenge: Security Developments from the Baltic Sea to the Black Sea,” European Parliament Directorate General for External Policies Issue Paper, 2017, p. 6. In the past decade, Russia has retooled its military and professionalized its officer corps—now seasoned by years of combat in Chechnya, Georgia, the Donbas, and Syria, as well as the occupation of Crimea and military aggression in the Kerch Straits. Repeatedly, Russia has defied international conventions and used force to change international boundaries.2Douglas E. Schoen and Evan Roth Smith, Putin’s Master Plan (New York: Encounter Books, 2016), p. vii. As the primary energy provider for much of eastern and central Europe, Russia can use energy security as a tool and weapon to coerce Europe. This trend that will only accelerate with the completion of the Nordstream II project.3Gabriel Collins, “Russia’s Use of the Energy Weapon in Europe,” Baker Institute for Public Policy Issue Brief, Rice University, July 18, 2017.

Russia’s military power is complemented by a sophisticated ability to conduct disinformation, propaganda, subversion, and cyber operations. With deep roots in Russian and Soviet history, but now modernized and hi-tech, this ability to operate in the “gray zone,” just below the kinetic level, is deeply destabilizing. Throughout Europe, Russia finances far-right candidates and parties, penetrates allied intelligence services, conducts targeted assassinations, and mounts effective information campaigns that sow doubt and dissension among allies and partners. The intent is to foster instability and a loss of confidence in democratic institutions, as well as drive wedges between the United States and Europe, and between European states themselves.4Bruce McClintock and Andrew Radin, “Russia in Action, Short of War,” US News & World Report, May 5, 2017.   The scale and reach of Russian information operations is impressive, reaching even into the 2016 US presidential elections with dismaying effects. A recent report by the US Department of State outlined the sophisticated disinformation ecosystem that Russia operates to sow discord and confusion in the United States.5Julia Ioffe, “What Putin Really Wants,” The Atlantic Monthly, January/February 2018; “Pillars of Russia’s Disinformation and Propaganda Ecosystem,” US State Department, August 2020.

Europe’s ability to weather a resurgent Russian challenge has been hindered in recent years by large numbers of refugees, a result of the Syrian civil war and Afghan insurgency which has profoundly affected European politics. In particular, mass migration has fueled the rise of right-wing parties, damaging NATO and EU cohesion.6Douglas Murray, “Borderline Disorder,” The National Review, July 12, 2018. In Germany, Chancellor Angela Merkel’s attempts to cope with these immigration waves resulted in election losses and a weaker governing coalition.7William A. Galston, “The Rise of European Populism and the Collapse of the Center-Left,” The Brookings Institution, March 8, 2018. In Italy, fierce opposition to immigration propelled the anti-establishment Five Star movement and right-wing, populist Lega Nord to power in 2018. Along the southern flank, Greece, Italy, and Spain are more concerned with refugees and fragile economies than with Russia.

Democratic backsliding is another worrisome trend. In Hungary, the Czech Republic, Bulgaria, and Romania, the erosion of democracy and growing corruption—aided by Russian subversion—have caused alarm.8“In Europe, as in most other parts of the world, democracy is retreating and autocracy is gaining.” Steffan I. Lindberg, “The Nature of Democratic Backsliding in Europe,” Carnegie Europe, July 24, 2018. Poland is staunchly anti-Russian, but also under scrutiny for its alleged suppression of journalists and a politicized judiciary. In the Balkans, poor economic performance and simmering ethnic controversies have slowed development, democratization, and integration into the broader European political, economic, and security community.

In concert with these dynamics, Turkey’s slide towards authoritarianism adds to the divisions in Europe. With no real prospect of European Union (EU) membership in the offing, Turkey’s relations with its European neighbors (particularly Germany, with its large Turkish minority) have badly deteriorated. US-Turkish relations are also as parlous as ever. Within NATO structures, Turkey has been chronically difficult, leveraging its status as a NATO member to play out disputes over Cyprus. With its traditionally secular military neutered, many now doubt that Turkey would fight in the Baltic States or contest Russia in the Black Sea, if faced with a conflict with Moscow. With little prospect for improved relations, Turkey may now pose an insider threat to NATO: an unreliable ally as likely to disrupt the Alliance as to support it.9Erdogan’s belief in US complicity in the 2016 coup, American harboring of Fetullah Gulen, support for the PKK as proxies in the Counter-ISIL campaign, and congressional opposition to Turkey’s pending acquisition of the Russian S-400 (which will trigger automatic sanctions) have damaged the bilateral relationship. Austin Bay, “Erdogan’s Turkey and NATO,” The Hoover Institution, Issue 52, July 31, 2018.

Amidst these challenges, former US President Donald J. Trump’s election in 2016, and the intense focus on burden-sharing that followed, has badly shaken European allies and partners. In public and private, Trump pressured allies to meet the goal of spending 2 percent of their gross domestic product (GDP) on defense, a benchmark few have yet achieved. Claiming repeatedly (and inaccurately) that the United States covers 90 percent of NATO’s costs, Trump threatened to withdraw US troops from Europe should the performance of allies not improve, calling into question the US commitment to Article 5 of the Washington Treaty which states, “an attack on one is an attack on all.”10Eileen Sullivan, “Trump Questions the Core of NATO,” New York Times, July 2018.

On paper, US allies have fallen short of their commitments to increase defense spending. As of 2020, only seven of twenty-eight NATO allies met the 2 pecent goal, and only fifteen have published nationally approved plans to achieve that standard.11See “Information on Defence Expenditures,” North Atlantic Treaty Organization, October 2020. Germany currently spends 1.2 percent of its GDP on defense, and has no apparent intent to grow beyond 1.5 percent. No single issue has created deeper rifts between the United States and its European allies.12“The question of where the Western defense pact fits into a 21st century in which Europeans disagree among themselves, as well as with the United States, on economic, trade and immigration issues, and in which the world is undergoing a basic realignment with the rise of Asia, has led some to consider a new arrangement,” Missy Ryan and Greg Jaffe, “US Assessing the Cost of Keeping Troops in Germany,” The Washington Post, June 29, 2018.

On closer examination, however, a different picture emerges. Today, NATO and EU defense spending, excluding the United States, is more than four times higher than Russia’s.13Total Alliance spending on defense for 2019 excluding the United States was $313B. “Information on Defence Expenditures,” According to the Stockholm International Peace Research Institute, the Russian defense budget for 2019 was estimated at $65B. Far from paying 90 percent of NATO’s costs, the United States contributes only 22 percent of NATO’s operating budget. These figures suggest that while the 2 percent goal receives most of the press play, the real danger lies not in how much Europeans spend on defense, but on how well they spend it. NATO and the EU field dozens of large headquarters with hundreds of generals, but few combat-ready formations. Even the largest and best European allies require months to put a single combat division in the field.14Poland, a bright spot in terms of readiness, can put more than four times as many tanks in the field as Germany with a defense budget more than four times smaller. International Institute of Strategic Studies, The Military Balance 2020. Across the Alliance, funding for training, maintenance, and ammunition falls short of requirements. Interoperability, despite years of emphasis, is still a work in progress.15See Franklin D. Kramer and Hans Binnendijk, “Meeting the Russian Conventional Challenge,” The Atlantic Council, February 2018.

During Trump’s presidency, these issues played out against a backdrop of disputes and friction that suggested potential US disengagement from Europe. Harsh criticism of the European Union (twenty-two countries are in both NATO and the EU), the US departure from the Paris Climate Accord and the Iran nuclear deal, US opposition to the Russian-German Nordstream II pipeline project, and arms control disagreements all combined to degrade transatlantic relations.16James M. Goldgeier, “Trump Goes to Europe,” Council on Foreign Relations, July 10, 2018. Deteriorating relations with Europe over these and other issues prompted French President Emmanuel Macron to call for an independent European security architecture, opening serious fissures in the Alliance and with the European Union.17“Emmanuel Macron warns Europe: NATO is becoming brain-dead,” The Economist, May 19, 2019.

Partly due to perceptions of US disengagement and loss of confidence in US leadership, a push for greater “strategic autonomy” under EU leadership has also gained traction since 2016. The term generates concern in some circles in the United States for its perceived deemphasis on NATO as Europe’s principal security provider. European leaders generally dispute this, citing the drive for common standards, a more coherent foreign policy, and a more unified stance on climate change, immigration, and democratic values as the core of this concept. Momentum towards these goals is sure to continue, but cautious articulation of European strategic concepts will be needed to preserve consensus going forward.18“When it comes to our alliance with the United States, beyond our values and historical ties, we cannot ignore an increasing number of geopolitical choices that run contrary to Europe’s interests … [but] I believe that deepening common defence is necessary, and is not an ideological obsession but a matter of common sense. This project must be carried out within NATO. This is the purpose of the strategic partnership between the EU and NATO.” Address by Charles Michel, President of the European Council, September 28, 2020.

Another trend putting pressure on the transatlantic relationship is China’s increasingly assertive behavior in Europe, enabled by its economic power and often manifested politically through international organizations. The strategic aim, apart from opening markets and creating favorable trade conditions, is apparently to drive wedges between Europe and others—especially the United States—in support of broader Chinese foreign policy and security goals. For example, Chinese sensitivity to criticism of its human rights record has resulted in strong pressure against Europe in the United Nations (UN), and even within the EU.19Stefan Lehne, “Securing the EU’s Place in the World,” Carnegie Europe, November 17, 2020.

Finally, ongoing trade disputes between Europe and the United States marred transatlantic unity and cooperation throughout the Trump administration. These have roots in different approaches to economic regulation of agricultural and manufacturing products like steel, aircraft, and automobiles, as well as to internet use, pharmaceuticals, and the use of economic sanctions for political purposes. The Trump administration’s embrace of tariffs and other forms of economic protectionism, in combination with its opposition to globalism, disrupted trade relations between the world’s two largest economic powers. These disruptions led to spillover effects in the political and security spheres.20Edward Alden, “Trump Is Escalating the Trade Fight with Europe,” Foreign Policy, July 24, 2020. With a goods and services trade of $1.1 trillion, Europe constitutes the United States’ most valuable trading partner, highlighting the need to repair this critical economic partnership.21This compares with US – China trade in goods and services of $635B. Both figures are for 2019. Source: Office of the US Trade Representative.

A general view during the NATO leaders summit in Watford, Britain, December 4, 2019. REUTERS/Kevin Lamarque

Alternative futures

These trends suggest at least three possible future scenarios.

Breakdown

In the first potential scenario, the deterioration in transatlantic relations continues, exacerbated by slow economic growth, growing political instability, US preoccupation with China, continued resistance to globalization, unresolved trade disputes, and a divergence of values and perceived common interests. In this scenario, NATO eventually loses relevance, to be replaced by European Common Defense under EU leadership. US major combat forces are withdrawn from Europe, and the US nuclear umbrella is called into question.

This scenario culminates in the breakdown of the transatlantic relationship. The post- World War II transatlantic security architecture falls apart as the United States continues its inward turn and Europe manages its own defense. Economically, transatlantic trade and commerce is marked by protectionism and tariffs, further dividing both sides of the Atlantic. The United States and Europe follow divergent paths on key global issues, especially how to address the China challenge. The breakdown of the transatlantic relationship accelerates the rise of a fractured, multipolar world defined by the United States focusing on the Western Hemisphere, increased tensions between Europe and Russia over Eurasia, and China in the Indo-Pacific.

Rejuvenation

In the second scenario, transatlantic relations are rejuvenated as the United States and European allies and partners recommit to longstanding ties and deepen cooperation. Allies and partners resolve tensions over trade and burden-sharing, and develop more unified approaches to dealing with Russia and China. US-European security arrangements are improved through closer coordination between NATO and the EU, yielding significant gains in readiness and deterrence.

In essence, this scenario amounts to a renaissance in the transatlantic relationship, which emerges from the challenges of recent years to become more robust and united. Discussions of strategic autonomy flounder as the United States and Europe establish deeper cooperation in economic and security domains. A stronger transatlantic relationship concerns Russia, but also helps to check Russian President Vladimir Putin’s ambitions. The United States and Europe also develop a coordinated approach to China that incorporates elements of both competition and cooperation. Trade and commerce flourish as the United States and Europe ink a new free trade agreement. On a host of other issues, including climate change and public health, the United States and Europe spearhead coordinated global action. This is not to say all problems will be resolved. Russia and China will continue to pose challenges and, within the NATO alliance, Turkey’s turn toward authoritarianism will continue to pose difficulties. Overall, however, the United States and Europe will be in a better position to address these issues and resolve internal tensions.

Independent Partnership

A third, hybrid scenario sees the United States and Europe as great independent powers cooperating when vital interests align, but without the close formal relationships that defined previous decades. Here the United States and Europe would continue to share democratic values and some level of cooperation (more often expressed through bilateral ties and coalition arrangements). However, they would follow increasingly independent strategic directions, with Europe acting as a strategic balancer between the United States, Russia, and China.

In this scenario, the United States and Europe avoid a breakdown in relations, but they also do not emerge with a stronger relationship. A combination of populism, tensions over trade and burden sharing, and calls for strategic autonomy limit opportunities to rejuvenate the transatlantic relationship. On the other hand, mutual concern over shared challenges—including Russia and China—as well as shared democratic values, allow the United States and Europe to maintain some degree of cooperation, albeit to a lesser extent than in decades past. Europe assumes greater control of its own security and strategic decision-making, but the transatlantic relationship retains some cohesion.

Solutions

It seems clear that of these alternative futures, a revived and rejuvenated US-Europe relationship offers the best prospects for all parties. The new administration of US President Joseph R. Biden, Jr., staffed with experienced supporters of the transatlantic partnership, appears committed to repairing transatlantic relations as a top foreign policy priority. This section outlines concrete steps that can be taken to help bring about the second scenario, a rejuvenated transatlantic relationship. Even if it is not possible to fully achieve that scenario, the following steps would still strengthen the transatlantic relationship and thus represent a worthwhile course of action.

  • First, foster a fresh approach. For some years, the United States has been critical of NATO and the EU, leading to erosion of confidence on both sides of the Atlantic. Early on, the new Biden administration should unambiguously affirm the United States’ strong commitment to transatlantic relations, fair trade, and European security.
  • Take positive steps to resolve disputes over burden-sharing through new narratives that emphasize Europe’s actual contributions. Together, European states spend far more on defense than Russia, though a “free rider” perception continues in the United States. Concrete improvements in readiness must underpin these narratives.
  • Restore effective deterrence by updating NATO’s nuclear posture, strengthening forward deployed forces in threatened areas, improving readiness and interoperability, and refreshing NATO’s Strategic Concept in concert with the EU.
  • Commit to fair and equitable trade relations through a new Transatlantic Trade and Investment Partnership, accompanied by a supporting US-United Kingdom (UK) Free Trade Agreement.
  • Incorporate the European Union more fully into the transatlantic security community while preserving NATO as Europe’s principal security provider. In many areas, such as cyber defense, technology, military mobility, and security assistance, the EU can play leading roles that complement NATO in the European security space.22On this front, close NATO Partners Sweden and Finland can play major roles. Closely aligned with fellow Nordic states and both members of the European Union, both enjoy longstanding relations with NATO, often participating in NATO-led operations. Their proximity to Russia, difficult conflict histories, and intimate understanding of Russian interests and capabilities provide key insights. Both possess quality militaries oriented on the security challenge posed by Russia, and both have proposed major increases in defense spending.[1] In crisis and conflict, the ability to leverage Swedish and Finnish intelligence services, airspace, and basing would be critical, while their armed forces could provide a decisive advantage in the Baltic Sea. While their domestic politics will control whether or not eventual membership in NATO transpires, the closest possible relationship is clearly in the best interests of all parties.
  • Support international organizations (the World Trade Organization, the International Monetary Fund, the G7, World Bank, the UN) as platforms to adjust and reconcile difficult political, economic, and security perspectives and disputes.
  • Work collaboratively to develop closer cooperation and consensus on China. This will require tough conversations to build consensus about the nature of China’s threat in military, economic, cyber, and political domains.
  • Leverage US and European economic and military power to both engage and restrain Russia. While continuous dialogue in good faith should take place with the Russia, NATO and the EU should not relax sanctions or return to business as usual—especially while Russia continues to occupy Crimea and destabilize Ukraine while conducting disinformation, propaganda, and subversion campaigns throughout Europe.
  •  Strengthen European energy security by jointly developing alternate sources, distribution networks, and supply chains. As the world leader in energy production, the United States is positioned to assist Europe in reducing its dependence on Russian energy. This approach can yield dividends both in security and in addressing trade imbalances. Cooperation in developing alternative, renewable, cleaner sources of energy can complement this approach.
  • Partner on climate change. The United States should reenter the Paris Climate Accords and promote affordable, meaningful initiatives at home and abroad to drive down carbon emissions and highlight climate change as an urgent priority.
  • Promote and advance democracy. Long a cherished US interest with bipartisan support, democracy promotion has not been emphasized in recent years. The Biden administration is well positioned to help strengthen democratic principles and processes in the North Atlantic community, perhaps along the lines of the “D-10” platform launched by the US Department of State in 2008.

Conclusion

Though the North Atlantic community faces challenges, there is reason for optimism. Longstanding confidence and trust in the transatlantic link are grounded in a long record of cooperation and success. The combined GDP of the United States and Europe is twenty times greater than Russia’s, and its overall defense spending is fourteen times greater. NATO’s sixty Allies and official partners constitute about 70 percent of the military capacity on the planet. Meanwhile the European Union is an economic powerhouse, with a combined GDP equal to that of the United States. The United States, France, and the UK are nuclear powers with seats on the UN Security Council. Above all, western democratic systems confer real political stability, enabling the economic and military strength that is the foundation of a rules-based international order.

Nevertheless, this relationship must be nurtured and renewed. It cannot be taken for granted. Here, goodwill and mutual respect must prevail. It is decisively in the United States’ national interest to combine and cooperate with like-minded and wealthy partners and friends in Europe who share its values and strategic interests. This partnership saw the United States through perhaps the most dangerous period in world history. It can surely steer allies through future storms.