Having just returned from a week of meetings in Berlin with our current group of Transatlantic Academy fellows, who are all working on German foreign policy, the future of the U.S.-German relationship, and implications for the broader transatlantic world, I came away with a number of impressions. What follows are some of my impressions based on our discussions. I cannot speak for our entire group but have incorporated some of their insights as well.
Russia policy dominated most of our discussions. Germany has emerged as the key European partner for the United States in dealing with Russia and is key to the future of Western Russia policy, especially in the area of economic sanctions. While there is a lot of dissatisfaction with the impact of sanctions on the German economy, especially in agriculture and machine tools and regionally in Bavaria and eastern Germany, and while there has been some wobbling on Russia among some prominent Social Democrats (SPD) and members of the Bavarian Christian Social Union (CSU), the sense I got was that the sanctions will hold so long as Angela Merkel is Chancellor.
In addition, we were surprised at the growing public and leadership support for an increase in defense spending, most notably Chancellor Merkel’s clear support for Germany to achieve the NATO goal of 2 percent of GDP for defense. This indicated both the growing sense of insecurity in Germany over Russia, Brexit, ISIS and Syria, terrorism at home, and the impact of refugees on law and order. Add to this a sense that the United States, no matter who is sworn in as president next January, will not be as engaged in Europe as during the Cold War period. Germans are now hedging their bets and not only understand that they have to do more in defense and counterterrorism but also that they have to create a European defense force as an insurance policy for cases where NATO will not act.
While NATO seems to have been revived by Russian aggression both in Europe and in Syria, there is still a significant tendency among portions of the German public toward anti-Americanism and equidistancing from Russia and the United States. The rise of the populist party Alternative for Germany (AfD), which is very pro-Putin, and the impact of Russian hybrid efforts to influence German opinion as well as the legacy of the German Democratic Republic, the Iraq War, Guantanamo, and Snowden have all played a part in shaping a U.S.-skeptic mood. The often irrational debate over the Transatlantic Trade and Investment Partnership (TTIP) has also been a major factor. So although the U.S. and German governments are working together very closely on Russia and other areas, the German public has not been carried along by its leaders. The rise of populism in both the United States and Germany will be potential game changers in the relationship.
It is in the economic area where the relationship seems to be most mixed. On the one hand, the United States is now Germany’s biggest trading partner and the two countries invest heavily in each other. They are both committed to an open international economic order. However, I was struck by the degree of concern about American corporate dominance in the German economy and the sense that the United States was engaging in a form of economic warfare with Germany. This includes the Department of Justice fine on Deutsche Bank, public concerns that TTIP will mean bring American (read lower) standards to Germany and interference in the German judicial system, worries that big data in the form of Google, Apple, and Facebook is not only infringing on German privacy but that these companies may use their large cash reserves to buy major German companies, including such icons as BMW. While German concerns about Chinese efforts to buy up German firms are getting the attention, this insecurity also applies to U.S. businesses. Add to this, major disagreements between Washington and Berlin over fiscal and monetary policies and the result is a prospect for divergence in the future. And the United States should not expect major changes in Germany’s Eurozone policies.
American policymakers are turning to Germany in the wake of Brexit and the decline of France, but U.S. expectations are likely to be exaggerated and will result in disappointment. Germany is the most successful and politically stable large country in Europe but it still lacks the will and full spectrum resources to lead a fragmented and highly diverse Europe. The lack of serious and coordinated strategic thinking in Berlin struck a number of us. “Leading from the center” by finding consensus among partners will be the German approach within the EU. However, Germany currently suffers from a lack of partners given not only Brexit but also the weakness in France and the current estrangement from Poland.
What all this means for the U.S.-German relationship is unclear. While the high initial expectations about an Obama presidency have been disappointed, Obama and Merkel have left a legacy of a close government-to-government relationship which is likely to continue under a Clinton presidency. A Trump Administration would create a serious crisis between Washington and Berlin and would do more damage to the American image in Germany. As one of our interviewees put it, “a clear victory for Clinton will mean image damage but not systemic damage.” This comes at a time when American engagement in Europe and a close U.S.-German relationship are vital.
Looking forward to the agenda for the new U.S. administration with Germany, the key challenges will be Russia, the Middle East, TTIP and the broader economic relationship. The Obama-Merkel years have left a good basis for a new partnership but it remains to be seen if this foundation will be built upon in the next administration with what is likely to be a weaker multiparty coalition government in Germany after the Bundestag elections next fall.