The United Kingdom:
Issues for the United States and U.S.-UK Relations
Derek E. Mix
Analyst in European Affairs
June 29, 2010December 20, 2012
Congressional Research Service
7-5700
www.crs.gov
RL33105
CRS Report for Congress
Prepared for Members and Committees of Congress
The United Kingdom: Issues for the United States and U.S.-UK Relations
Summary
Many U.S. officials and Members of Congress view the United Kingdom (UK) as the United
States’ closest and most reliable ally. This perception stems from a combination of factors,
including a sense of shared history, values, and culture;, as well as extensive and long-established bilateral
bilateral cooperation on a wide range of foreign policy and security issues; and. In the minds of many
Americans, the UK’s strong role in
Iraq and Afghanistan. The United States and the UK also cooperate closely on counterterrorism
efforts. The two countries share an extensive and mutually beneficial trade and economic
relationship, and each is the other’s largest foreign investor.
The term “special relationship” is often used to describe the deep level of U.S.-UK cooperation
on diplomatic and political issues, as well as on security and defense matters such as intelligencesharing and nuclear weapons. British officials enjoy a unique level of access to U.S.
decisionmakers, and British input is often cited as an element in shaping U.S. foreign policy
debates. Few question that the two countries will remain close allies that choose to cooperate on
many important global issues such as counterterrorism, the NATO mission in Afghanistan, and
efforts to curb Iran’s nuclear activities. At the same time, some observers have called for a
reassessment of the “special relationship” concept. Some British analysts express concern that the
UK tends to be overly deferential to the United States, sometimes at the possible expense of its
own national interests. Others assert that British policymakers are in the process of adjusting to
new geopolitical realities in which changing U.S. priorities may mean that the UK will not always
be viewed as a centrally relevant actor on every issue.
The UK is one of the 27 member countries of the European Union (EU). While the UK’s relations
with the EU have historically involved a degree of ambivalence and a reluctance to pursue certain
elements of integration, British policy and the UK’s outlook on many global issues are often
shaped in the context of its EU membership. For example, analysts note that some UK policy
positions, such as its approach to climate change, are closer to those of its EU partners than to
those of the United States.
The Conservative Party won the most seats in the UK election of May 6, 2010, although they fell
short of winning an absolute majority. On May 11, 2010, the Conservatives agreed to form a
coalition government with the Liberal Democrats, who finished third in the election. Conservative
leader David Cameron became the UK’s new prime minister, and Liberal Democrat leader Nick
Clegg was named deputy prime minister. The Conservative-Liberal Democrat government is the
UK’s first coalition government since World War II. After losing a considerable number of seats
in the election and finishing in second place, the Labour Party moved into opposition. Labour had
led the UK government for 13 years, first under Tony Blair (1997-2007) and then under Gordon
Brown.
U.S.-UK relations and the implications of the 2010 British election may be of interest in the
second session of the 111th Congress. This report provides an overview of the election and
discusses some of the key issues facing the new government. The report also examines the UK’s
relationship with the European Union and assesses some of the main dimensions of the U.S.-UK
relationship. For broader analysis of transatlantic relations, see CRS Report RS22163, The United
States and Europe: Current Issues, by Derek E. Mix.
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Contents
Introduction ................................................................................................................................1
The 2010 UK Election ................................................................................................................2
State of the Economy ............................................................................................................3
Political Reform....................................................................................................................3
Implications for the United States..........................................................................................4
The UK and the European Union.................................................................................................4
A Coalition Compromise on Europe......................................................................................5
The UK Between the United States and the EU .....................................................................6
U.S.-UK Relations ......................................................................................................................6
Political Relations .................................................................................................................7
Defense Relations .................................................................................................................9
Economic Relations ............................................................................................................ 11
Selected Issues in U.S.-UK Relations ........................................................................................ 12
Counterterrorism................................................................................................................. 12
Afghanistan ........................................................................................................................ 13
Iran..................................................................................................................................... 15
Tables
Table 1. May 2010 UK General Election Results .........................................................................2
Contacts
Author Contact Information ...................................................................................................... 16
Acknowledgments .................................................................................................................... 16
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The United Kingdom: Issues for the United States
Introduction
Many U.S. officials and Members of Congress view the United Kingdom (UK) as the United
States’ closest and most reliable ally. This perception stems from a combination of factors,
including a sense of shared history, values, and culture; extensive and long-established bilateral
cooperation on a wide range of foreign policy and security issues; and the UK’s strong role in
Iraq and Afghanistan. The United States and the UK also cooperate closely on counterterrorism
efforts.
The modern U.S.-UK relationship was forged during the Second World War, and cemented during
the cold war by the need to deter the Soviet threat. It is often described as the “special
relationship.” This term describes the high degree of mutual trust between the two counties in
cooperating on diplomatic and political issues. The United States and the UK are two of the five
permanent members of the United Nations Security Council, and are both founding members of
the North Atlantic Treaty Organization (NATO). U.S. and UK officials, from the Cabinet level to
the working level, consult frequently and extensively on many global issues. American and
British diplomats report often turning to each other first and almost reflexively when seeking to
build support for their respective positions in multilateral institutions or during times of crisis, as
in the immediate aftermath of the 9/11 attacks on the United States. Some observers assert that a
common language and cultural similarities, as well as the habits of cooperation that have
developed over the years, contribute to the ease with which U.S. and UK policymakers interact
with each other.1
The “special relationship” also encompasses unusually close intelligence-sharing arrangements
and unique cooperation in nuclear and defense matters. During the cold war, the UK served as a
vital base for U.S. forces and continues to host U.S. military personnel and equipment. 2 U.S.
defense planners view the UK as one of the most capable European allies—if not the most
capable—in terms of combat forces and the ability to deploy them.
The mutually beneficial trade and economic relationship is another important aspect of the U.S.UK partnership. The UK is the sixth-largest economy in the world and the sixth-largest export
destination for U.S. goods. It is also the sixth-largest supplier of U.S. imports. Even more
significantly, the UK and the United States are one another’s largest foreign investors.
U.S. military and economic preponderance, however, has caused many to characterize the UK as
the “junior” partner in the U.S.-UK relationship, and to note that the relationship often appears to
be more “special” to the UK than it is to the United States. While few question that the UK’s role
as a close U.S. ally and partner on a host of important global issues will continue, some observers
have asserted a need for the UK to reassess its approach to the “special relationship,” and to
adjust its mindset in accordance with changing geopolitical realities.
1
See, for example, C.J. Bartlett, The Special Relationship: A Political History of Anglo-American Relations since 1945
(New York: Longman, Inc.), 1992.
2
For more information on the history of U.S.-UK intelligence and defense relations, see John Baylis, Anglo-American
Defense Relations 1939-1984 (New York: St. Martin’s Press), 1984.
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The 2010 UK Election
The UK general election of May 6, 2010, resulted in a hung parliament, an outcome in which no
single party wins a majority of seats in the House of Commons. The Conservative Party, led by
David Cameron, won the most seats but fell 20 short of the 326 needed to form a majority
government on its own. The Labour Party suffered substantial losses and finished in second place.
Labour had won the three previous elections and led the UK government since 1997, first under
Tony Blair (1997-2007) and then under Gordon Brown.
After five days of negotiations, the Conservatives reached an agreement on forming a coalition
government with the Liberal Democrats, led by Nick Clegg, who finished third in the voting.
With this deal reached, Gordon Brown resigned as prime minister and David Cameron became
the new prime minister of the United Kingdom on May 11, 2010. Cameron appointed five Liberal
Democrats to serve in his cabinet, including Nick Clegg as deputy prime minister.
Table 1. May 2010 UK General Election Results
# of Seats
(649 total declared)
Net # of Seats +/–
% of Vote
Conservatives
306
+97
36.1%
Labour
258
-91
29.0%
Liberal Democrats
57
-5
23.0%
All Others
28
-1
11.9%
Party
Source: “Election 2010,” BBC News, http://news.bbc.co.uk/2/shared/election2010/results/.
Given ideological differences between the two parties, some analysts assert that the
Conservatives and the Liberal Democrats are an unlikely pairing for the UK’s first coalition
government since World War II. Adding up the numbers, however, this combination was the only
one that could deliver a solid majority, a fact that may have provided a strong argument for
ideological compromise. The two parties reached an initial policy agreement with a swiftness and
ease that surprised some observers, and both appeared willing to give ground on some issues.
Some observers, nevertheless, wonder how well and how long the arrangement will work.
Before the past 13 years of Labour government, the Conservatives had led the UK government
for a stretch of 18 years, first under Margaret Thatcher (1979-1990), followed by John Major
(1990-1997). The Conservatives, who are often also called the Tories, are generally considered to
be a party of the center-right, although some elements of the party also tend to be more right-wing
than centrist. While critics charge that the Conservative Party remains dominated by the interests
of the country’s social and economic elites, David Cameron, who became the party leader in 2005
and now becomes prime minister at the age of 43, has sought to portray the party as more modern
and inclusive. For instance, Cameron has spoken forcefully in support of efforts to address
climate change.
The Liberal Democrats were formed by the 1988 merger of the Liberal Party and the Social
Democratic Party. The Liberal Democrats are considered a center-left party, and members often
describe themselves as progressive. Since their formation, the Liberal Democrats have been the
UK’s “third party,” struggling to assert their voice alongside Labour and the Conservatives. Nick
Clegg, who became the party leader in 2007 and now becomes deputy prime minister at the age
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of 43, campaigned on the themes of fairness and social equality, portraying the Liberal Democrats
as the alternative to either of the larger parties.
State of the Economy
The economy is the most pressing issue facing the new government. Between 1993 and 2008, the
British economy enjoyed an unprecedented period of sustained growth. The UK, however, was
severely impacted by the global financial crisis and entered a deep recession in 2008—the British
economy contracted nearly 5% in 2009 and unemployment rose from 5.6% in 2008 to an
expected 8.3% in 2010. The recession appears to be ending this year, with growth forecast at
0.9% for 2010 and 1.3% for 2011.3
During the years of economic expansion, however, the UK developed a large structural deficit
and accumulated considerable public sector debt. The financial crisis and recession greatly
exacerbated this situation: the government budget deficit grew from 4.8% of gross domestic
product (GDP) in 2008 to 11.2% in 2009 and is forecast to be 10.5% in 2010. Public sector debt
is expected to grow from 52% of GDP in 2008 to more than 80% in 2011.4
On June 22, Chancellor of the Exchequer George Osborne presented an emergency budget that
aims to substantially reduce the UK’s deficit over the next five years. Austerity measures include
a planned 25% reduction in governmental department expenditures over the next four years
(excluding health and foreign aid), a public sector wage freeze, and cuts to welfare benefits such
as disability and housing allowances. Although the Conservatives’ traditional instinct is that
cutting spending while holding down taxes is the best way to stimulate growth and hiring, some
tax increases have been deemed unavoidable: the new government is raising value-added tax
(VAT) from 17.5% to 20% as of January 2011, increasing the capital gains tax from 18% to 28%
for high earners, and introducing a new tax on banks. On the other hand, the budget also plans to
lower the corporation tax and raise the tax threshold for low income citizens.
The government’s key challenge is now to sell its painful austerity program to the British public.
Critics have charged that the measures could hurt the economy’s growth prospects, increase
unemployment, result in the deterioration of public services, and impact society in ways that are
unequal and unfair. Others have praised the new government’s belt tightening as necessary in
order to put the UK back on the path of financial sustainability. In any case, international
financial markets do not, for the time being, appear to regard the UK with the same concern felt
about, for example, some of the southern members of the Eurozone.
Political Reform
The result of the 2010 election could usher in landmark changes in the British political system.
The coalition partners quickly agreed to terms that offer one another a measure of insurance. The
partners installed “fixed term” Parliaments of five years, setting the next election for May 2015.
Previously, general elections could not be held more than five years apart, but the prime minister
could, by custom, dissolve Parliament and call for a new election at his discretion. The coalition
also agreed that the votes of 55% of the members of Parliament would now be required to bring
3
4
Economist Intelligence Unit, Country Report: United Kingdom, June 2010.
Ibid.
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down the government in a vote of no confidence—previously, a no confidence vote could be won
by a simple majority.
More broadly, the coalition partners plan to hold a national referendum on introducing an
“Alternate Vote System” for future general elections.5 The vagaries of the UK’s “first-past-thepost” electoral system (i.e., winner take all within each electoral district) operate to the great
benefit of the two largest parties—and to the detriment of the Liberal Democrats—in terms of
transferring the popular vote into parliamentary seats (see Table 1). The Liberal Democrats have
long advocated the introduction of some type of proportional representation electoral system,
such as those used in many countries in continental Europe (the Alternate Vote System is regarded
as one of the least proportional models of proportional representation voting systems). Although
agreeing to the referendum, the Conservatives oppose such reform and are expected to campaign
against it. The introduction of proportional representation voting, even if in its “lightest” form,
could potentially make it much more difficult in the future for one party to achieve a majority,
possibly making coalition politics a more permanent fixture in the UK.
Implications for the United States
The main dimensions of transatlantic cooperation and partnership are unlikely to be altered under
the Conservative-Liberal Democrat coalition. Media coverage of the election has made much of
assertions that the United States and the UK are drifting apart, that the special relationship is over,
and that the UK will seek a more independent course in foreign policy. Officials and analysts are
reassessing the nature of the U.S.-UK relationship (see “Political Relations”), but most agree that
suggestions of a dramatic break or shift in the relationship are exaggerated. David Cameron and
his new ministers are expected to seek a close relationship with President Obama, the U.S.
Administration, and the U.S. Congress. No sudden moves are expected in British policy on key
issues such as counterterrorism, the NATO mission in Afghanistan, and Iran’s nuclear program
(see “Selected Issues in U.S.-UK Relations”), as well as the Israeli-Palestinian conflict, relations
with Russia, the future of NATO, and international trade and economic policy.
The UK and the European Union
The relationship between the UK and the EU has long been marked by a certain degree of
ambivalence. The UK stood aside in the 1950s when the six founding countries (Belgium, France,
Italy, Luxembourg, Netherlands, and West Germany) launched the first steps of European
integration, fearing a loss of national sovereignty and influence. The UK finally joined the
precursor of the modern-day EU in 1973, largely in order to derive the economic benefits of
membership but also to have a political voice on the inside as integration took shape.
Nevertheless, historically many British leaders and citizens have remained skeptical of the EU
and ambivalent in their support for further European integration (including, notably, former Prime
Minister Margaret Thatcher).
5
According to the BBC’s Election 2010 Q&A on Electoral Reform and proportional representation, in an Alternate
Vote System, “Voters rank the candidates. If no candidate has 50% of first preferences then second preferences are
counted and so on until someone has a majority.” http://news.bbc.co.uk/2/hi/uk_news/politics/election_2010/
8644480.stm
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The UK has zealously guarded elements of its national sovereignty to a greater degree than most
EU countries. On the whole, the UK’s “Anglo-Saxon” economic philosophy and approach to
social issues differs from those of its continental partners, and the UK has been especially
adamant about shielding its national prerogatives in these areas. Most famously, the UK retains
the pound sterling as its national currency and appears unlikely to adopt the euro anytime soon.
The UK does not participate in the Schengen Agreement that creates a virtually borderless visaand passport-free zone among most EU countries. The UK secured an exemption from the
Charter of Fundamental Rights that was attached to the Lisbon Treaty and details a sweeping
range of social protections, and negotiated the right, in effect, to choose which policies in “Justice
and Home Affairs” areas (such as police and judicial cooperation) it wishes to take part in under
the new treaty. Many British officials and observers have long opposed the “Federalist” vision of
EU integration, preferring instead an “intergovernmental” arrangement between sovereign states.
British leaders have also tended to express impatience with what they view as the EU’s tendency
to look inward and focus on process and institutional arrangements, arguing instead for an
outward-looking and results-oriented EU focused on action.
On the other hand, there is no question that the EU and the 26 other member countries of the EU
are, alongside the United States and select others, among the UK’s main allies and partners in the
world. Although “euro-skepticism” is considerable among the British public, it is far from
universal. Geographically, the UK is much closer to continental Europe than to North America,
and over half of British trade is conducted with fellow EU members. Moreover, some observers
assert that many of the UK’s diplomatic and foreign policy impulses, in areas such as climate
change policy, for example, are closer to those of its EU partners than to those of the United
States. During the Blair years, the UK was a driving force behind EU efforts to strengthen its
foreign policy and defense cooperation. For many European policymakers, including in the UK,
the need for the EU to speak with “one voice” in a more cohesive EU Common Foreign and
Security Policy (CFSP) was one of the great lessons of the Iraq War. In 1998, Blair reversed the
UK’s long-standing opposition to the development of an EU defense arm, and British
involvement is viewed by many as an essential ingredient for the viability of the EU Common
Security and Defense Policy (CSDP).
A Coalition Compromise on Europe
Many members of the Conservative Party are critical of the European Union and opposed to the
current level of European integration, in which they believe the UK has surrendered too much
national sovereignty. The prevalence of such “euro-skeptics” among the Conservative ranks has
had many in Brussels wondering about how a Conservative-led government might manage the
UK’s relations with the EU. In summer 2009, David Cameron pulled the British Conservative
Members of the European Parliament (MEPs) out of the main center-right political group that
includes the parties of German Chancellor Angela Merkel and French President Nicolas Sarkozy
to caucus with much smaller “euro-skeptic” parties. The Conservatives opposed ratification of the
Lisbon Treaty, the EU reform treaty that came into effect in December 2009, and Cameron had
long suggested that the UK should hold a national referendum on the treaty rather than approving
it by parliamentary vote. There remains some sentiment among Conservatives that the UK should
try to reclaim aspects of national sovereignty that have been pooled into the EU.
The Liberal Democrats, on the other hand, are the most pro-EU of the UK’s three major parties,
as demonstrated by their calls for the UK to adopt the euro as its national currency. The initial
policy agreement announced by the Conservative-Liberal Democrat coalition indicated that the
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two parties had agreed to a “truce” on Europe under which the UK would be a “positive
participant” in the EU. The coalition has ruled out any moves toward joining the euro during the
lifetime of the current Parliament, and has pledged to hold a referendum on any future EU
proposals that would transfer additional power or sovereignty to Brussels. In addition, the
Conservatives have agreed not to seek opt-outs from EU social legislation, although they will try
to limit the application of an EU law that caps the number of hours an employee can work in a
given week. While the coalition compromise indicates a constructive British approach to the EU
under Prime Minister Cameron, the potential for friction still remains.
The UK Between the United States and the EU
Some analysts have long described the UK as caught in a balancing act between the United States
and the European Union. The UK has, at times, sought to play the role of a “transatlantic bridge”
between Washington, DC, and the EU. Prime Minister Blair sought to perform such a role after
taking office in 1997, believing that strong U.S.-UK and UK-EU relations would be mutually
reinforcing. Blair is often credited, for example, with having a key role in gaining U.S.
acquiescence to the December 2003 NATO-EU deal to enhance EU defense planning capabilities.
Ultimately, however, domestic political struggles and the bitter intra-European divisions
stemming from the 2003 Iraq War limited some of the possibilities for UK-EU relations under
Blair. Nonetheless, the UK remained a highly influential voice through its EU presidency during
the second half of 2005 and Blair’s last EU Summit, in June 2007, which launched the Lisbon
Treaty.
Other analysts assert that the dimensions of British foreign policy have never been as simplistic
as a black-and-white choice between the United States and Europe. According to many,
depictions of a zero-sum choice between one or the other are false and artificial—the United
States and the EU generally have similar interests and compatible outlooks, work together in an
expanding range of issues, and are far more often partners than adversaries. In addition, there is a
significant NATO dimension to the discussion: 21 members of the EU, including the UK, are also
members of NATO. In the end, UK officials and analysts assert what might appear obvious to
some: UK foreign policy decisions have always been and will continue to be determined
primarily by British national interests, and preserving the UK’s position as a strong U.S. ally and
leading EU partner provides the UK with the greatest ability to promote its diverse interests in
Europe and beyond.
U.S.-UK Relations
Strong relations with the United States have been a cornerstone of UK foreign policy, to varying
degrees and with some ups and downs, since the 1940s. Observers assert that the UK’s status as a
close and loyal ally of the United States has often served to enhance its global influence. The UK
is often perceived to be the leading allied voice in shaping U.S. foreign policy debates: in 1944,
the UK Foreign Office described its American policy as being to “steer this great unwieldy barge,
the United States, into the right harbor,” a statement that well describes the mindset of many
British diplomats over the ensuing decades.6 Beyond the bonds of similar interests and values,
some experts suggest that the United States has been more inclined to listen to the UK than to
6
As quoted in Robin Harris, “The State of the Special Relationship,” Policy Review, June/July 2002.
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other European allies because of the UK’s more significant military capabilities and willingness
to use them against common threats. On the other side, British support has often helped add
international credibility and weight to U.S. policies and initiatives, and the close U.S.-UK
partnership has benefitted the pursuit of common interests in bodies such as the U.N., NATO, and
other multilateral institutions.
Political Relations
The U.S.-UK political relationship encompasses a deep and extensive network of individuals
from across the public and private sectors. Relationships between the individual national leaders,
however, are often analyzed by some observers as emblematic of countries’ broader political
relations. Former Prime Minister Tony Blair established a close personal relationship with both
President Bill Clinton and President George W. Bush. Following the terrorist attacks of
September 11, 2001, Blair established himself as a key Bush Administration ally in the U.S. “War
on Terrorism.” He also famously backed the Bush Administration with regard to the Iraq War, and
was an important advocate in support of the case for invasion. In a March 2002 Cabinet meeting,
Blair reportedly stated that the UK’s national interest lay in “steering close” to the United States
because otherwise the UK would lose its influence to shape U.S. policy. He argued that by
seeking to be the closest U.S. ally, the UK stood a better chance of preventing the United States
from overreacting, could encourage the U.S. Administration to pursue its objectives in Iraq in a
multilateral way, and could try to broaden the U.S. agenda to include what the UK and other EU
partners viewed as the root causes of Islamist terrorism, such as the Israeli-Palestinian conflict.
The degree to which the UK influenced U.S. policy choices in the war on terrorism, Iraq, and
other issues has been a topic of much debate on both sides of the Atlantic. Some observers
contend that Blair played a crucial role in convincing the Bush Administration to initially work
through the United Nations with regard to Iraq. They argue that the priority Blair placed on
resolving the Israeli-Palestinian conflict helped keep that issue on the Bush Administration’s radar
screen, and that the UK was instrumental in pressing for a meaningful international peacekeeping
presence in Afghanistan, which resulted in the creation of the NATO-led International Security
Assistance Force (ISAF).
Critics, however, charge that Blair and the UK got little in return for their unwavering support of
controversial U.S. policies. Opponents point out Blair was unable to prevent the United States
from abandoning efforts to reach a comprehensive international consensus regarding Iraq, that
little progress has been made in recent years on the Israeli-Palestinian conflict, and that tepid U.S.
responses to Blair’s initiatives on African development and climate change further demonstrate
that Blair’s close relationship with Bush yielded few benefits for the UK. Some commentators
came to describe Blair as the American president’s “poodle,” and Blair paid a high political price
with the British public and within his own Labour Party for his close alliance with President
Bush. The question of how the UK benefitted from its support of the United States during the
Blair-Bush years raised some debate in the UK about the nexus between transatlantic solidarity
and British national interests, and whether future British prime ministers may think twice about
boldly supporting controversial U.S. policies or make more explicit demands of the United States
as the price for support. Some British observers are anxious to assert that British national interests
come first and foremost in deciding British policy, arguing that these interests are not always
identical to U.S. national interests, and that the UK should not be overly deferential to the United
States in foreign policy issues.
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Upon taking over as prime minister in 2007, Gordon Brown sought to distance himself from some
of the domestically unpopular foreign policy choices of his predecessor. Given the British
public’s unease with the close Blair-Bush alliance, Brown appeared disinterested in developing a
close personal relationship with the U.S. President, demonstrating instead a business-like
approach that kept his counterpart at arm’s length. Some observers pointed out that because of the
political timetable, Brown had little incentive to develop a close relationship with Bush, and that
he was to a large extent awaiting the arrival of a new U.S. President in January 2009.
Nevertheless, far from reorienting UK foreign policy in a new direction, Brown also attempted to
maintain the portrayal of the “special relationship” and made no major substantive changes in
relations with the United States: he maintained the UK’s commitment to a strong counterterrorism
policy and to the mission in Afghanistan, even if proceeding with the planned withdrawal of
British forces in Iraq, which raised some questions and concerns among U.S. policymakers.
Prime Minister Brown pursued closer relations with President Obama. Brown visited Washington,
DC, in March 2009 to meet with Obama ahead of the G-20 and NATO Summits that were held in
Europe in early April. He also addressed a joint session of Congress. In being the first European
leader to visit the Obama White House, some observers pointed to an intention to symbolically
reaffirm the vitality of the “special relationship.” Critics, however, sensed that some aspects of
Brown’s reception seemed lukewarm, raising speculation as to whether Obama shares quite the
same level of enthusiasm about the bilateral relationship.
Some observers assert that Obama is the first post-war U.S. President with no sentimental
attachments to Europe, and many argue that with U.S. foreign policy priorities increasingly
focused on the Middle East and Asia, Europe, including the UK, faces a growing struggle to
remain relevant in U.S. eyes. Media reports in September 2009 indicating that Brown had been
“rebuffed” over the course of the year in numerous attempts to secure another personal meeting
with Obama created a degree of heightened anxiety in the UK about the future of the “special
relationship” and how it is viewed by the Obama Administration. Some observers, however,
assert that certain sources—in particular the British media—tend to read too much into the
appearance of personal relations between the individual leaders, noting that the functional aspects
of the U.S.-UK relationship run much broader and deeper.
Nevertheless, many analysts agree that a reassessment of the “special relationship” concept is in
order. As part of an on-going debate about emergent geopolitical trends and the UK’s changing
global role, British officials and analysts may seek to adjust outlooks and expectations to better
match perceptions of national interests and capabilities. Most agree that the U.S.-UK political
relationship is likely to remain intimate, and that the “special relationship” in areas such as
defense and intelligence cooperation will almost certainly remain strong. On vital issues such as
Afghanistan and Pakistan, for example, most observers agree that the UK is a crucial U.S. ally. In
an increasingly “G-20 world,” however, the UK may not be centrally relevant to the United States
in all of the issues and relations considered a priority on the U.S. agenda.7
The oil spill in the Gulf of Mexico poses an early test for the Cameron-Obama relationship. BP is
an important stock in the portfolios of most British pension funds, and the company’s declining
value has been viewed with alarm by many in the UK. Some in the British media have
complained about what they perceive as an overly harsh backlash against BP by President
7
See, for example, the November 11, 2009, testimony of Dr. Robin Niblett in House of Commons Foreign Affairs
Committee, Global Security: UK-US Relations, March 18, 2010, p. Ev 3.
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Obama, the Administration, and the Congress, asserting that BP is being excessively pilloried
because of its foreign ownership. Some observers have urged Prime Minister Cameron to
intervene and tell U.S. critics to back off. These tensions, as well as economic issues and the
situation in Afghanistan, were reportedly the central topics of discussion in the first face-to-face
meeting between President Obama and Prime Minister Cameron, which took place on the
sidelines of the G8 and G20 Summits in Ontario, Canada in late June 2010.
Defense Relations
U.S.-UK defense cooperation became especially close and well established during the cold war,
as both countries worked together bilaterally and within the context of NATO to counter the
threat of the Soviet Union. In the early 1990s, the UK was an important U.S. ally in the first Gulf
War, and the two countries later worked together in stabilization and peacekeeping operations in
the Balkans. The UK was the leading U.S. ally in the 2003 invasion of Iraq and subsequent
stabilization operations, and is the largest non-U.S. contributor to the International Security
Assistance Force (ISAF) mission in Afghanistan. Many observers consider the UK the most
valuable and effective U.S. ally in such military operations, noting that the United States and the
UK tend to have similar outlooks on issues such as the use of force, the development of military
capabilities, and the role and shape of NATO.
The UK has long hosted important U.S. forces at airbases on British soil, and also hosts vital U.S.
radar and intelligence-gathering installations. U.S. and British forces have established extensive
liaison and exchange arrangements with one another, with British officers routinely seconded to,
for example, the Pentagon, U.S. Central Command Headquarters in Tampa, FL, and U.S. Naval
Headquarters in Norfolk, VA. British sources reportedly often have access and input into U.S.
defense planning and efforts such as Quadrennial Defense Reviews and the 2009 U.S. Strategic
Review on Afghanistan and Pakistan.8
The 1958 U.S.-UK Mutual Defense Agreement established unique cooperation with regard to
nuclear weapons, allowing for the exchange of scientific information and nuclear material.9 The
United States has supplied Britain with the missile delivery systems for its nuclear warheads since
1963. The UK’s nuclear deterrent currently consists of several Vanguard class submarines, each
armed with up to 16 Trident missiles (totaling as many as 48 nuclear warheads). In 2007, former
Prime Minister Blair announced plans to renew the UK’s current nuclear weapons system by
joining a U.S. program to extend the life of the Trident missiles into the 2040s and by building a
new generation of submarines in the UK. Although the Liberal Democrats campaigned for
phasing out the UK’s nuclear role, the Conservatives support maintaining Trident, and the
coalition plans to continue with the maintenance and updating of the UK’s weapons.
Given the difficulties with the UK’s public finances, concerns are growing about the UK’s ability
to maintain its core defense budget to meet the equipment needs of the military. The new
government is launching a defense spending review, and while the defense budget may not be
affected immediately, projected spending cuts in the years ahead are likely and will probably
include equipment procurement programs.10 This reality is likely to force the UK to make tough
8
See House of Commons Foreign Affairs Committee, op. cit., pp. 23-24.
9
The document can be found on the website of the British American Security Information Council, at
http://www.basicint.org/nuclear/MDA.htm.
10
The direct cost of military operations such as Iraq and Afghanistan is covered by a Treasury reserve fund that is
(continued...)
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The United Kingdom: Issues for the United States
decisions about its future force structure. On the one hand, the UK could attempt to maintain a
military with “full spectrum” capabilities mirroring those of the United States, allowing the
British military to fight alongside U.S. forces as well as undertake a broad range of independent
missions and operations. On the other hand, some suggest that the UK could decide to cut back,
focusing on centrally important capabilities and abandoning others, and increasingly seeking to
leverage joint capability planning and development efforts offered by European defense
integration initiatives.
The United Kingdom and the United States are also key partners in terms of defense industry
cooperation and defense sales. The two countries are engaged in more than 20 joint equipment
programs, including the Joint Strike Fighter (JSF).11 In FY2008, U.S. foreign military sales
(government-to-government) to the UK reportedly topped an estimated $1.1 billion and shipment
of U.S. direct commercial sales (contractor-to-government) to the UK reportedly exceeded an
estimated $3.1 billion. 12 The United States is the largest overseas supplier of the UK Ministry of
Defense. The UK, in turn, is the largest overseas supplier to the U.S. Department of Defense, and
the United States is the UK’s second-largest defense market overall (behind Saudi Arabia). The
United States, however, acquires a relatively small proportion of its defense equipment from
overseas: the balance of U.S.-UK defense exports is about 2 to 1 in favor of the United States.
Most major U.S. defense companies have a UK presence and, led by BAE Systems, numerous
British companies operate in the United States. British defense companies’ U.S. operations tend
to be part of a larger supply chain, with sales consisting mostly of components and niche
equipment, rather than entire platforms.13
U.S. regulations related to technology transfer and the export of defense articles have long been a
source of frustration for British officials. For years, the UK sought a waiver to the U.S.
International Traffic in Arms Regulations (ITAR) that would eliminate the requirement for
individual export licensing of each article. British officials have argued that ITAR and the related
licensing process unduly hinder defense trade and cooperation and prevent greater military
interoperability, citing the UK’s status as a valuable and trustworthy ally as grounds for waving
the regulation. British arguments, however, have come up against strong congressional opposition
due to U.S. concerns that technology could be re-exported to third countries. Congress
nevertheless granted the UK “preferred” ITAR status in October 2004—intended to expedite the
export licensing process for British defense firms—but many in the UK still maintained that the
process remained too burdensome. In the context of the Joint Strike Fighter program, the British
became concerned they would not have sovereign access to key technologies involved in the
aircraft. In December 2006, the United States and the UK signed a memorandum of
(...continued)
separate from the core defense budget. In the 2008/09 fiscal year, operations in Afghanistan cost the Treasury reserve
over £2.6 billion, and over £14 billion total has been spent on operations (mostly Iraq and Afghanistan) since 2001. See
NATO Parliamentary Assembly, information document from the 2009 Annual Session, The Global Financial Crisis
and its Impact on Defense Budgets, http://www.nato-pa.int/Default.asp?SHORTCUT=1928.
11
The Joint Strike Fighter program is a multinational procurement effort—involving the United States, the UK, six
other NATO allies, and Australia—to develop and produce the next generation fighter/strike aircraft, the F-35. For
more information, see CRS Report RL30563, F-35 Joint Strike Fighter (JSF) Program: Background and Issues for
Congress, by Jeremiah Gertler.
12
U.S. Department of State, FY2010 Congressional Budget Justification, Foreign Assistance, Title IV Supporting
Information, pp. 4, 270-276, http://www.state.gov/documents/organization/124296.pdf.
13
See House of Commons Foreign Affairs Committee, op. cit., pp. 25, Ev111-Ev112.
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The United Kingdom: Issues for the United States
understanding effectively guaranteeing that the UK would receive the sensitive JSF technology it
demanded.
In June 2007, in an effort to address long-standing British concerns about U.S. technologysharing restrictions and export controls, the countries signed a Defense Trade and Cooperation
Treaty that would eliminate individual licensing requirements for certain ITAR-controlled defense
articles and services. The treaty is reciprocal and is intended to cover defense equipment for
which the U.S. and UK governments are the end-users. The treaty also calls for the creation of
“approved communities” of companies and individuals in each country with security clearances
to deal with technological transfers.14 The UK has ratified the treaty, and it is currently pending
before the U.S. Senate Foreign Relations Committee. U.S. concerns persist over whether UK
safeguards and enforcement mechanisms will be sufficient to protect transferred material. If
ratified, the U.S. Department of State would amend ITAR to account for the treaty provisions.
Economic Relations
The U.S.-UK bilateral investment relationship is the largest in the world. In 2008, UK investment
in the United States totaled $454 billion, supporting over 1 million American jobs. U.S.
investment in the UK totaled $421 billion. Between 2000 and 2009, the UK was the secondlargest overseas market for U.S. foreign direct investment (FDI), behind the Netherlands, and
received nearly 20% of U.S. FDI flows to Europe.15 Tourism and trade are also important pillars
of the economic relationship. In 2008, nearly 3 million Americans visited the UK and 4 million
British residents visited the United States. Also in 2008, the United States ran a trade surplus with
the UK, with exports of goods and services worth $116 billion and imports worth $104 billion. 16
The global financial crisis and recession has had a significantly negative impact on world trade
and investment flows. Both the United States and the UK are home to major world financial
centers, and the U.S.-UK economic relationship has been affected. British banks have suffered
massive losses from their exposure to asset-based securities linked to the U.S. sub-prime
mortgage market. Over the first three quarters of 2009, U.S. FDI flows to the UK fell 65%
compared to the first three quarters of 2008.17 Prime Minister Brown led efforts to forge an
international response to the crisis through the G-20. As the EU and the United States seek to
formulate and implement new rules for financial sector regulations, analysts believe that thinking
in the UK on such issues tends to be more aligned to that of the United States than countries such
as France and Germany.
The European Commission negotiates a common EU trade policy on behalf of its member states,
and therefore UK trade policy is formulated within an EU context. Although most of the U.S.-EU
economic relationship is harmonious and mutually beneficial, some tensions persist. Current
U.S.-EU trade disputes focus on poultry, aircraft subsidies, hormone-treated beef, and genetically
14
See Claire Taylor, UK-US Defence Trade Co-operation Treaty, House of Commons Library, International Affairs
and Defence Section, February 17, 2009, http://www.parliament.uk/commons/lib/research/briefings/snia-04381.pdf.
The full text of the treaty can be accessed at http://www.state.gov/t/pm/rls/othr/misc/92770.htm.
15
Center for Transatlantic Relations, Johns Hopkins University Paul H. Nitze School of Advanced International
Studies, The Transatlantic Economy 2010, pp. 99-100.
16
U.S. Department of State, Background Note: United Kingdom, October 2009, http://www.state.gov/r/pa/ei/bgn/
3846.htm.
17
Center for Transatlantic Relations, op. cit., p. 97.
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The United Kingdom: Issues for the United States
modified (GM) food products. The UK has been a consistent supporter of U.S.-EU efforts to
lower transatlantic and global trade barriers, and to reach an agreement in the Doha Round of
multilateral trade negotiations.18
Selected Issues in U.S.-UK Relations
The United States and the UK share a long list of similar global interests, and act in close concert
on a wide range of international issues. While a full list would include such topics as the IsraeliPalestinian conflict, non-proliferation of weapons of mass destruction, relations with Russia, and
many more, this section highlights three issues to illustrate the nature of U.S.-UK cooperation.
Counterterrorism
Most analysts and officials agree that U.S.-UK counterterrorism cooperation is close, wellestablished, and mutually beneficial. 19 The UK’s Security Service (MI5) and Secret Intelligence
Service (MI6) routinely cooperate closely with their U.S. counterparts in the sharing of
information, and U.S. and British law enforcement and intelligence agencies regularly serve as
investigative partners. Counterterrorism cooperation with the UK also takes place in the context
of the many U.S.-EU agreements that have been put in place in recent years. According to the UK
Foreign and Commonwealth Office, however, the U.S.-UK intelligence and law enforcement
relationship “far outstrips the level of interaction and co-operation with other nations.”20 In
addition to efforts seeking to disrupt terrorist attacks against U.S. and European targets, U.S. and
UK officials cooperate closely with regard to developments in countries such as Afghanistan,
Pakistan, Somalia, and Yemen.
The UK has extensive experience in dealing with issues of terrorism and homeland security,
having long faced terrorist attacks from groups such as the Irish Republican Army (IRA). More
recently, as highlighted by the deadly July 2005 attacks on the London transportation system and
the failed car bomb attempts in London and Glasgow in the summer of 2007, radical Islamist
terrorism has developed into a primary domestic threat. Many were alarmed that the majority of
the perpetrators in these attacks were “homegrown” British Muslims. The British government
launched its long-term Strategy for Countering International Terrorism (CONTEST) in 2003. The
CONTEST strategy consists of four strands: (1) disrupting terrorist attacks through prosecution
and other measures at home, combined with military and intelligence operations abroad; (2)
working with vulnerable communities to prevent radicalization and extremism; (3) reducing the
vulnerability of national infrastructure, crowded places, transportation systems, and borders; and
(4) mitigating the impact of terrorist attacks through well-trained and equipped regional and local
resilience networks and crisis management structures. As of 2008, the UK’s annual spending on
18
For more information, see CRS Report RL34381, European Union-U.S. Trade and Investment Relations: Key Issues,
coordinated by Raymond J. Ahearn; and CRS Report RS22645, U.S.-European Union Relations and the 2007 Summit,
by Raymond J. Ahearn, Kristin Archick, and Paul Belkin.
19
See, for example, House of Commons Foreign Affairs Committee, Global Security: UK-US Relations, March 18,
2010, pp. 39-42.
20
House of Commons Foreign Affairs Committee, op. cit., p. Ev 61.
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The United Kingdom: Issues for the United States
counterterrorism, resilience, and intelligence activities had doubled since 9/11, to some £2 billion
(about $3 billion).21
In recent years, the UK has strengthened its anti-terrorism laws and expanded the powers of its
intelligence and law enforcement agencies.22 The Terrorism Act 2006 created a series of new
terrorism-related criminal offenses, including the encouragement of terrorism and the
dissemination of terrorist propaganda, including via the Internet. It also gave the government the
right to ban groups that glorify terrorism, and extends the allowable period of detention without
charge from 14 to 28 days. The Counterterrorism Act 2008 further increased the powers of law
enforcement authorities in terrorism-related cases, changing rules related to searches,
interrogations, asset seizures, and the collection and use of evidence. The act also increased
sentences for some terrorism-related offenses. Civil liberties advocates have sharply criticized
these pieces of legislation. Sharing some such concerns, Parliament rejected a proposal in the
Counterterrorism Act 2008 to increase the legal period of detention without charge to 42 days.
Although the overall U.S.-UK intelligence and counterterrorism relationship is overwhelmingly
positive, some tensions exist. The relationship was damaged by public accusations of British
complicity in U.S.-led renditions and the alleged torture of terrorist suspects between 2002 and
2008. Related court cases sought the release of intelligence documents and raised concerns in the
intelligence community about the risk of confidential information coming into the public domain
through the British legal system. In the past, some British officials have objected to the U.S.
detention facility at Guantanamo Bay and complained that the United States concealed practices
such as waterboarding. Some British officials also complain that the updated bilateral extradition
treaty that was signed in March 2003 favors the United States.23
Some U.S. critics have also charged that UK measures to clamp down on Islamist extremists are
long overdue. They argue that until recently, traditionally liberal asylum and immigration laws in
the UK, as well as the country’s strong free speech and privacy protections, attracted numerous
radical Muslim clerics claiming persecution at home. As a result, some say the UK became a
breeding ground for Islamist terrorists—some observers have sarcastically described an open
culture of radical Islamism in London as “Londonistan.” In recent years, the UK has expelled
some foreign imams and others who espouse extremism and terrorist violence, and denied entry
to others. Concerns about radicalization in the UK resurfaced in December 2009 when a Nigerian
who had lived and studied in London attempted to blow up an airliner en route from Amsterdam
to Detroit.
Afghanistan
The UK is the second-largest troop contributor to the NATO-led International Security Assistance
Force (ISAF) mission in Afghanistan.24 The UK contributes 9,500 soldiers to ISAF. Counting an
21
See the March 2009 update of the CONTEST strategy, http://security.homeoffice.gov.uk/news-publications/
publication-search/contest/contest-strategy/contest-strategy-20092835.pdf?view=Binary.
22
UK counterterrorism legislation includes the Public Order Act 1986; the Terrorism Act 2000; the Anti-Terrorism,
Crime and Security Act 2001; the Prevention of Terrorism Act 2005; the Terrorism Act 2006; and the Counterterrorism
Act 2008.
23
The U.S.-UK extradition treaty is treaty number 108-23.
24
For more information on international efforts in Afghanistan, see CRS Report RL30588, Afghanistan: Post-Taliban
Governance, Security, and U.S. Policy, by Kenneth Katzman.
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The United Kingdom: Issues for the United States
additional 500 special forces operating in the country, there is a total of approximately 10,000
British soldiers in Afghanistan. The UK is also the largest European donor of bilateral aid to
Afghanistan, contributing some £740 million (about $1.15 billion) since 2001 for development
and security assistance, and pledging a further £510 million (about $790 million) for the next four
years.25
Most British forces are based in the volatile southern province of Helmand, where they have
engaged in frequent combat with Taliban insurgents. The UK has suffered approximately 310
military fatalities in Afghanistan since operations began in 2001, which is more than the number
of casualties the UK had in Iraq. British casualties in Afghanistan spiked in July 2009 during a
pre-election offensive against the Taliban, and over 100 British soldiers were killed in 2009 alone.
While stating that he prefers not to base planning on “strict timetables,” Prime Minister Cameron
recently stated that he would like all British troops out of Afghanistan by 2015.26
Like their U.S. and NATO counterparts, British officials have repeatedly called for greater troop
and equipment contributions from some of the European allies. “National caveats”—restrictions
that some governments place on their troops to prevent them from engaging in combat
operations—have been a sore spot within the Alliance. The UK also has contentious relations
with Afghan President Hamid Karzai. Tensions grew when Karzai criticized the 2006 British
compromise with insurgents in the Musa Qala district of Helmand. The UK negotiated a deal
under which both the British military and the Taliban would withdraw from the area and leave it
under the control of tribal leaders. The Taliban subsequently returned and overran the district in
early 2007. In addition to frustrations with the pace of efforts to build Afghan security selfsufficiency, the UK has been highly critical of alleged corruption in Karzai’s government.
By and large, the UK has concurred with the Obama Administration’s Afghanistan strategy, and
British sources have reportedly had significant input into elements of U.S. strategic review. Points
of agreement include focusing on Afghan army and police training and civilian efforts regarding
governance, rule of law, and economic development. Some British officials and observers have
long asserted that the key to defeating the insurgency lies in political solutions and incentives
aimed at militants who may not be motivated by radial Islamic ideology, and some have long
advocated negotiations with the more moderate elements of the Taliban. In August 2009, the
House of Commons Foreign Affairs Committee published a report asserting that the direction and
tendencies of U.S. policy under the Bush Administration—including an excessive focus on
military goals—bear substantial responsibility for many of the problems facing international
efforts in Afghanistan today.
The UK strongly supports a regional approach to Afghanistan that includes Pakistan. Prime
Minister Brown stated that three-quarters of the terrorist plots uncovered in the UK have their
roots in the Afghanistan-Pakistan border region. The UK is helping train and equip Pakistani
forces for counter-insurgency operations along the Afghan border and plans to provide £665
million (approximately $1 billion) in aid to Pakistan over the period 2009-2013.27
25
UK Foreign and Commonwealth Office, The UK Effort in Afghanistan, http://www.fco.gov.uk/en/global-issues/
conflict-prevention/uk-effort-in-afghanistan/ and UK Department for International Development (DFID),
http://www.dfid.gov.uk/Where-we-work/Asia-South/Afghanistan/.
26
“Cameron wants troops home from Afghanistan by 2015,” BBC News, June 25, 2010, http://news.bbc.co.uk/2/hi/
politics/10420911.stm.
27
UK Department for International Development (DFID), Afghanistan Country Plan: 2009-13,
(continued...)
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The United Kingdom: Issues for the United States
Iran
The United States and the UK share the same goals with respect to Iran, starting with curbing its
nuclear program and ending its sponsorship of groups such as Hezbollah and Hamas. Officials in
London have long advocated conditional engagement with Iran over isolation, and as one of the
“EU-3” (with France and Germany) the UK has played a leading role in diplomatic efforts to
curtail Iran’s uranium enrichment activities. British leaders are committed to a diplomatic
resolution, pressing Iran to make a choice between harsh sanctions and isolation versus economic
and technical cooperation. The UK has also been central in pushing for the four rounds of limited
sanctions related to Iran’s nuclear program that have been adopted by the United Nations Security
Council (UNSC) since 2006 (Resolutions 1737, 1747, 1803, and 1929). The latest round of
sanctions was passed in June 2010 after the UK, along with France and the United States,
presented the International Atomic Energy Agency (IAEA) in September 2009 with evidence of a
previously secret Iranian enrichment facility near the city of Qom.
Tensions between the UK and Iran increased following the controversial and disputed reelection
of Iranian President Mahmoud Ahmadinejad in June 2009. Iranian authorities blamed postelection unrest on Western interference, and particularly singled out the UK. Although Prime
Minister Brown strongly criticized the behavior of the Iranian government, the UK Foreign
Office vehemently denied any British involvement in organizing opposition activities. In late
June, Iran expelled two British diplomats (prompting the UK to expel two Iranian diplomats) and
angered the British government with the arrest of nine local staff of the UK embassy in Tehran.
Eight of the nine were eventually released, but in October 2009 Hossein Rassam was sentenced to
four years in prison for “inciting unrest,” a move that drew sharp condemnation from British and
EU officials. Iran has also long accused the UK of supporting Jundallah, a militant Sunni group
that operates along the Iran-Pakistan border. Iranian officials harshly asserted that the British
government was behind an October 2009 Jundallah suicide bombing against Iranian
Revolutionary Guard troops. In December 2009, Iran released five British citizens who had been
detained for a week when their yacht strayed into Iranian waters. Previously, Iran had forcibly
detained British naval personnel in 2004 and 2007.
U.S. officials have long urged European countries—including the UK—to do more to limit their
trade and business ties with Iran and to adopt and enforce tighter sanctions, even if outside the
U.N. framework. The EU and a number of member countries have taken some such autonomous
measures, but many Europeans prefer to work strictly within the U.N. process regarding
international sanctions. In recent years, some British banks, including the UK’s largest (HSBC),
have voluntarily cut back business dealings with Tehran and Iranian banks. The UK and the EU
have long opposed the U.S. Iran Sanctions Act (ISA) as an extraterritorial application of U.S. law,
although no firms have ever been sanctioned under ISA. Some European governments have in the
past expressed concern that legislation like H.R. 2194 (H.Rept. 111-512), passed by the House
and Senate in June 2010, could harm European energy companies and undermine transatlantic
unity. 28
(...continued)
http://www.dfid.gov.uk/Documents/publications/Afghanistan-Country-Plan-2009.pdf.
28
For more information, see CRS Report RS20871, Iran Sanctions, by Kenneth Katzman.
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The United Kingdom: Issues for the United States
Author Contact Information
Derek E. Mix
Analyst in European Affairs
dmix@crs.loc.gov, 7-9116
Acknowledgments
This report was originally written by Kristin Archick, CRS Specialist in European Affairs.
Congressional Research Service
16 Iraq and Afghanistan during the past decade reinforced an
impression of closeness and solidarity.
The 2010 UK election resulted in the country’s first coalition government since the Second World
War. The Conservative Party won the most votes in the election, and Conservative leader David
Cameron became the UK’s prime minister. The Conservatives partnered with the Liberal
Democrats, who came in third place, with Liberal Democrat leader Nick Clegg named deputy
prime minister. The Labour Party, now under the leadership of Ed Miliband, moved into
opposition after leading the UK government since 1997.
Economic and fiscal issues have been the central domestic challenge facing the coalition thus far.
Seeking to reduce the country’s budget deficit and national debt, the coalition adopted a five-year
austerity program early in its tenure. With the UK entering a double-dip recession in 2012, the
government has been maintaining its austerity strategy under considerable pressure and criticism.
Austerity has also heightened social tensions and contributed to rising political friction between
the coalition partners. Although the coalition arrangement went smoothly during its first year, the
Conservatives and Liberal Democrats have subsequently disagreed about a series of domestic
issues, including a number of proposed changes to the country’s political system.
Europe has been another source of tension. The UK has long been one of the most skeptical and
ambivalent members of the 27-country European Union (EU). While the Conservative Party
remains a stronghold of “euro-skeptics,” the Liberal Democrats are the UK’s most pro-EU
political party. The Eurozone crisis has deepened British antipathy toward the EU, fueling calls to
reclaim national sovereignty over issues where decision-making has been pooled and integrated
in Brussels. Some analysts believe that a British departure from the EU is a growing possibility;
Prime Minister Cameron may seek to renegotiate some of the terms of membership and put the
UK’s relationship with the EU to a national referendum in 2015. Adding another note of
uncertainty to the British political landscape, Scotland plans to hold a referendum in 2014 on
whether to separate from the UK and become an independent country.
In recent years, some observers have suggested that the U.S.-UK relationship is losing relevance
due to changing U.S. foreign policy priorities and shifting global dynamics. An imbalance of
power in favor of the United States has occasionally led some British observers to call for a
reassessment of their country’s approach to the relationship. Despite such anxieties, most analysts
believe that the two countries will remain close allies that choose to cooperate on many important
global issues such as counterterrorism, the NATO mission in Afghanistan, efforts to curb Iran’s
nuclear activities, and global economic challenges.
Given its role as a close U.S. ally and partner, developments in the UK and its relations with the
United States are of continuing interest to the U.S. Congress. This report provides an overview
and assessment of some of the main dimensions of these topics. For a broader analysis of
transatlantic relations, see CRS Report RS22163, The United States and Europe: Current Issues,
by Derek E. Mix.
Congressional Research Service
The United Kingdom and U.S.-UK Relations
Contents
Introduction...................................................................................................................................... 1
The UK’s Coalition Government ..................................................................................................... 1
Austerity and the UK Economy ....................................................................................................... 2
Domestic Political Dynamics........................................................................................................... 3
The UK and the European Union .............................................................................................. 4
Scotland ..................................................................................................................................... 6
U.S.-UK Relations ........................................................................................................................... 6
Political Relations...................................................................................................................... 6
Defense Relations ...................................................................................................................... 8
Austerity and the Defense Budget ....................................................................................... 9
The UK in Afghanistan ..................................................................................................... 10
Intelligence and Counterterrorism Cooperation ...................................................................... 11
Economic Relations ................................................................................................................. 12
Conclusion ..................................................................................................................................... 13
Tables
Table 1. May 2010 UK General Election Results ............................................................................ 2
Contacts
Author Contact Information........................................................................................................... 14
Congressional Research Service
The United Kingdom and U.S.-UK Relations
Introduction
The modern U.S.-UK relationship was forged during the Second World War, and cemented during
the Cold War as both countries worked together bilaterally and within the North Atlantic Treaty
Organization (NATO) to counter the threat of the Soviet Union. The United States and the UK are
two of the five permanent members of the United Nations Security Council, and both are
founding members of NATO. In the early 1990s, the UK was an important U.S. ally in the first
Gulf War, and the two countries later worked together in stabilization and peacekeeping
operations in the Balkans. The UK was the leading U.S. ally in the 2003 invasion of Iraq and
subsequent stabilization operations, remains the largest non-U.S. contributor to the NATO-led
mission in Afghanistan, and took a leading role in alliance operations in Libya in 2011. It is also
an important U.S. partner in efforts to pressure Iran over its nuclear activities, and to restart the
Middle East peace process. The UK is the seventh-largest economy in the world and a major
financial center. The United States and the UK share an extensive and mutually beneficial trade
and economic relationship, and each is the other’s largest foreign investor.
U.S. and UK officials, from the cabinet level down, consult frequently and extensively on many
global issues. American and British diplomats report often turning to each other first when
seeking to build support for their respective positions in multilateral institutions or during times
of crisis, as in the immediate aftermath of the 9/11 attacks on the United States. British input is
often cited as an element in shaping U.S. foreign policy debates. Some observers assert that a
common language and cultural similarities, as well as the habits of cooperation that have
developed over the years, contribute to the ease with which U.S. and UK policymakers interact
with each other. The term “special relationship” has often been used to describe the high degree
of mutual trust between the two countries in cooperating on diplomatic and political issues. The
special relationship also encompasses close intelligence-sharing arrangements and unique
cooperation in nuclear and defense matters.
The UK’s Coalition Government
The UK general election of May 6, 2010, resulted in a hung parliament, an outcome in which no
single party wins a majority of seats in the House of Commons. The Conservative Party, led by
David Cameron, won the most seats but fell 19 short of the 326 needed to form a majority
government on its own. The Labour Party suffered substantial losses in the election and finished
in second place. Labour had won the three previous elections and had led the UK government
since 1997, first under Tony Blair (1997-2007) and then under Gordon Brown.
Shortly after the election, the Conservatives reached an agreement on forming a coalition
government with the Liberal Democrats, led by Nick Clegg, who finished third in the voting.
With this deal reached, Gordon Brown resigned as prime minister and David Cameron became
the new prime minister of the United Kingdom. Cameron appointed five Liberal Democrats to
serve in his cabinet, including Nick Clegg as deputy prime minister. Ed Miliband, who served as
energy and climate change secretary in the Brown government, was chosen to replace Brown as
the new leader of the Labour Party, making him also leader of the parliamentary opposition.
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The United Kingdom and U.S.-UK Relations
Table 1. May 2010 UK General Election Results
Party
# of Seats
Net # of Seats +/–
% of Vote
Conservatives
307
+97
36.1%
Labour
258
-91
29.0%
Liberal Democrats
57
-5
23.0%
All Others
28
-1
11.9%
Source: “Election 2010,” BBC News, http://news.bbc.co.uk/2/shared/election2010/results/.
Before the 13-year run of Labour government from 1997 to 2010, the Conservatives had led the
UK government for a stretch of 18 years, first under Margaret Thatcher (1979-1990), followed by
John Major (1990-1997). The Conservatives, who are often also called the Tories, are generally
considered to be a party of the center-right, although some elements of the party also tend to be
more right-wing than centrist. While critics charge that the Conservative Party remains dominated
by the interests of the country’s social and economic elites, David Cameron, who became the
party leader in 2005 and prime minister at the age of 43, has sought to portray the party as more
modern and inclusive. For instance, Cameron has spoken forcefully in support of efforts to
address climate change.
The Liberal Democrats were formed by the 1988 merger of the Liberal Party and the Social
Democratic Party. The Liberal Democrats are considered a center-left party, and members often
describe themselves as progressive. Since their formation, the Liberal Democrats have been the
UK’s “third party,” struggling to assert their voice alongside Labour and the Conservatives. Nick
Clegg, who became the party leader in 2007 and deputy prime minister at the age of 43,
campaigned on the themes of fairness and social equality, portraying the Liberal Democrats as the
alternative to both of the larger parties.
Austerity and the UK Economy
The economy has been by far the most pressing issue facing the coalition. Between 1993 and
2008, the British economy enjoyed an unprecedented period of sustained economic growth. The
country was severely impacted by the global financial crisis, however, and entered a deep
recession in 2008. The economy contracted by 4.0% in 2009. After a slow recovery with weak
growth in 2010 and 2011, the British economy has returned to recession in 2012, and over the
next five years, economic growth is forecast to average less than 1% per year.1
During the years of economic expansion, the UK developed a large structural budget deficit. The
financial crisis and recession greatly exacerbated this situation: the government budget deficit
grew from 5.0% of gross domestic product (GDP) in 2008 to 11.4% in 2009 and 10.2% in 2010.
Public sector debt has grown from 52.3% of GDP in 2008 to an expected 89.6% in 2012.2
In response to these trends, the Conservative-Liberal coalition government unveiled a major
austerity program in June 2010, aiming to reduce the deficit below 1.5% of GDP by 2015 with
1
2
Economist Intelligence Unit, Country Report: United Kingdom, December 2012.
ibid.
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£80.5 billion (about $129 billion) in spending cuts and £30 billion (about $48 billion) in tax
increases. Cuts include a 20-30% reduction in governmental department expenditures (excluding
health and foreign aid, and a smaller reduction in defense and education); a public sector wage
freeze; and cuts to welfare benefits such as disability, child benefit, and housing allowances. Tax
increases include raising the VAT from 17.5% to 20%; increasing capital gains tax and income tax
for high earners; increasing national insurance contributions; and introducing a new bank tax.
This austerity effort remains the signature initiative of the Cameron government, and its key
challenge has been to sell the program to the public and to balance the goals of growth and
recovery, on the one hand, with concerns about the sustainability of public finances, on the other.
Supporters have praised the government’s approach as necessary in order to put the UK back on
the path of financial sustainability. Critics, however, have charged that the austerity measures are
too aggressive, hurt the economy’s growth prospects, and are likely to increase unemployment,
erode public services, and impact society in ways that are unequal and unfair. The “double dip”
recession has led the government to miss deficit targets, and the country’s weak economic
performance has fueled charges that austerity is backfiring.
In any case, despite widespread concerns about the sustainability of the UK’s public finances,
there was no obvious pressure from the markets for the UK to adopt additional austerity
measures. In contrast to the countries at the center of the Eurozone debt crisis, such as Greece,
Ireland, and Portugal, markets ostensibly view the UK’s independent floating currency and
central bank, and the long-term structure of its debt, as distinct advantages: the UK retains a AAA
sovereign rating. Although the UK is not a member of the Eurozone, it has extensive economic
linkages with its fellow member countries of the European Union (EU), including considerable
bank exposure to countries such as Ireland and Spain. Analysts assert that the Eurozone debt
crisis is hurting the UK’s economic growth, and any significant worsening of the crisis would
likely have major negative repercussions for the British economy.
Domestic Political Dynamics
Given ideological differences between the Conservatives and the Liberal Democrats, analysts
asserted that the two parties were an unlikely pairing for the UK’s first coalition government
since World War II. Adding up the numbers, however, this combination was the only one that
could deliver a solid parliamentary majority after the 2010 election, a fact that seems to have
provided a strong argument for ideological compromise. The two parties reached an initial policy
agreement with a swiftness and ease that surprised some observers, with both parties apparently
willing to give ground on some issues. Both parties strongly backed the austerity program, and
the coalition functioned relatively smoothly in its first year.
Over the past 18 months, however, the Conservative-Liberal coalition has developed a number of
significant strains. The coalition partners have been at odds over proposed changes to the
country’s voting system, boundary reform (redistricting), reform of the House of Lords, and press
regulation in the wake of a media phone-tapping scandal. In addition, the Liberal Democrats, in
particular, have suffered from public backlash to austerity. Many members of the party base
appear to feel that the party has betrayed its core social principles. The party has felt pressure to
assert a more distinct identity within the coalition, and some Liberal Democrats have increasingly
argued for an easing of the government’s austerity strategy.
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The next general election is due in 2015, but given the growing number of friction points in the
coalition, some observers suggest that the chances of an early election have increased. On the
other hand, analysts assert that the weak condition of the economy and the inevitable public
unpopularity of austerity measures will continue to make any notion of breaking up the coalition
and holding an early election far too risky for both parties. In early December 2012, one major
public opinion poll showed 43% support among voters for the Labour Party, 31% for the
Conservatives, and 11% for the Liberal Democrats. In the same poll, 24% of respondents
approved of the coalition’s record thus far and 61% disapproved.3
The UK and the European Union
Europe has become another point of disagreement between the coalition partners. Both at home
and abroad, many aspects of UK policies are set in the context of the country’s membership in the
European Union. The other 26 member countries of the EU are among the UK’s closest political
and economic partners, and over half of British trade is conducted with its fellow EU members.
Partners such as NATO and the United States play an important role in the UK’s diplomatic and
security affairs, but many elements of British foreign policy also have an EU dimension.
Nevertheless, historically many British leaders and citizens (perhaps most notably including
former Prime Minister Margaret Thatcher) have been skeptical about the EU, and the relationship
between London and Brussels has often been marked by a certain degree of ambivalence. The UK
stood aside in the 1950s when the six founding countries (Belgium, France, Italy, Luxembourg,
Netherlands, and West Germany) launched the first steps of European integration, fearing a loss
of national sovereignty and influence. The UK finally joined the precursor of the modern-day EU
in 1973, largely in order to derive the economic benefits of membership but also to have a
political voice on the inside as integration took shape. The UK has “opted out” of several major
elements of European integration, however. Most significantly, the UK retains the pound sterling
as its national currency and is therefore outside the group of 17 EU member countries that use the
euro as their common currency (i.e., the Eurozone). The UK also does not participate in the
Schengen Agreement that establishes a passport-free zone among most EU countries.
The Eurozone crisis that began in Greece in 2009 has deepened the traditional British skepticism
about the EU, and the Conservative Party remains a stronghold of this skepticism. Many members
of the Conservative Party are highly critical of the EU and believe the UK has surrendered too
much national sovereignty to Brussels. Prior to the 2010 UK election, the prevalence of such
“euro-skeptics” among the Conservative ranks had many wondering how a Conservative-led
government would manage the UK’s relations with the EU. In summer 2009, David Cameron
pulled the British Conservative Members of the European Parliament (MEPs) out of the main
center-right political group to caucus with much smaller “euro-skeptic” parties. The
Conservatives also opposed ratification of the Lisbon Treaty, the EU reform treaty that took effect
in December 2009; as leader of the opposition, Cameron had suggested that the UK should hold a
national referendum on the treaty instead of approving it by parliamentary vote.
The Liberal Democrats, by contrast, are the most pro-EU of the British political parties,
advocating closer integration with Europe, and having campaigned in favor of the UK adopting
the euro. The policy agreement announced at the formation of the Conservative-Liberal Democrat
3
See the YouGov/Sunday Times poll for December 2-3, 2012,
http://cdn.yougov.com/cumulus_uploads/document/8xuu7flmio/YG-Archive-Pol-Sun-results-031212.pdf.
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coalition indicated that the two parties had agreed to a compromise on Europe under which the
UK would be a “positive” participant in the EU. The coalition ruled out any moves toward
joining the euro during the lifetime of the current Parliament, and pledged to hold a referendum
on any future EU proposals that would transfer additional power or sovereignty to Brussels.4
The coalition compromise on Europe initially established what some observers described as a
“pragmatic” approach, but the course of the Eurozone crisis has raised tensions to the point where
some observers have begun to question the future of UK membership in the EU. British leaders
have stressed that a stable and successful Eurozone is greatly in the UK’s interest, but the
Cameron government has pointedly declined to participate in numerous proposed elements of the
EU’s crisis response efforts, including by contributing to the EU sovereign “rescue funds,” and
has zealously safeguarded the UK’s financial sector from attempts to extend EU regulation. The
UK declined to participate in a new “fiscal compact” treaty that was signed by 25 of the 27
member states and which calls for greater central surveillance over national budgets and the
adoption of a balanced budget requirement in national constitutions. The UK has also been a
leading voice of opposition against proposals to increase the EU budget.
At the same time, the UK is anxious to maintain a seat at the table and to exert influence in crisis
resolution discussions in order to protect its interests in the functioning of the EU single market
(comprised of all 27 EU members). British leaders have supported tighter integration within the
Eurozone on fiscal and banking issues as a necessary solution to the crisis, but they are concerned
about the prospect of being sidelined by new intergovernmental institutions in which decisions
taken among the 17 Eurozone countries affect the interests of all 27 EU members. For example, a
more tightly integrated “Eurozone caucus” within the EU, making decisions on economic policies
that affect the wider single market, would be in a strong position to essentially push its decisions
onto the other EU member countries that remain outside the “caucus.”
Many in the Conservative Party have long wished for a referendum on the UK’s EU membership,
and many remain irritated that Prime Minister Cameron retracted earlier pledges on holding a
referendum if elected. In October 2011, Conservative backbenchers rebelled against the prime
minister to push for such a vote, and the referendum was avoided only through the votes of
Labour and the Liberal Democrats.
Prime Minister Cameron has indicated the possibility of a referendum about the UK’s relationship
with the EU following the next national election in 2015. Analysts believe the prime minister
could seek to negotiate with the EU on a “better deal” for the UK, presumably entailing
additional “opt outs” that repatriate elements of decision-making integration from Brussels back
to London. The Cameron government has been conducting a comprehensive review of the UK’s
relationship with the EU, and has already begun acting on pressures to reclaim aspects of national
sovereignty from Brussels, starting with the area of “justice and home affairs” (EU police and
judicial cooperation). Many observers have doubts, however, about the willingness of EU
countries to agree to significant new concessions for the UK.
Assuming there is some type of new deal, Prime Minister Cameron might then put the terms of
the renegotiated relationship to the British public in what could essentially amount to an “in-or-
4
Vaughne Miller, The Government's Policy on Europe, House of Common Library, February 7, 2011,
http://www.parliament.uk/briefing-papers/SN05854.
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out” referendum.5 Surveys show that a large majority of the British public wants a referendum on
EU membership, and one recent poll indicated that 49% would vote to leave the EU and 28%
would vote to remain, with many undecided.6
Scotland
The question of Scottish independence has also risen to the forefront of British politics. In 1998,
the British Parliament passed an act allowing the creation of a regional Scottish Parliament and
Executive with devolved powers over local issues. The Scottish National Party (SNP), which has
long advocated separation from the UK, won a majority in the Scottish Parliament in 2011 and
increased its push for a referendum that could grant Scotland more devolved powers or even
outright independence.
In October 2012, Prime Minister Cameron and Scottish First Minister Alex Salmond agreed on
the terms for a single-question, in-or-out Scottish referendum on independence from the UK, to
be held by the end of 2014. Current polls indicate that a majority of Scots are likely to vote to
remain part of the UK, but observers expect pro- and anti-independence campaigns will intensify
considerably over the next two years.
Scottish independence would raise numerous challenges and complicated issues, including the
status of independent Scotland with regard to NATO and the EU; the status of UK military forces,
including nuclear submarines, based in Scotland; the potential need to establish a new national
currency for Scotland; and the viability of the Scottish economy and welfare state. The crowns of
England and Scotland were joined in 1603 and their parliaments were merged in 1707.
U.S.-UK Relations
Political Relations
The UK’s “special relationship” with the United States has been a cornerstone of British foreign
policy, to varying degrees and with some ups and downs, since the 1940s. The UK is often
perceived to be the leading allied voice in shaping U.S. foreign policy debates, and observers
assert that the UK’s status as a close ally of the United States has often served to enhance its
global influence. British support, in turn, has often helped add international credibility and weight
to U.S. policies and initiatives, and the close U.S.-UK partnership has benefitted the pursuit of
common interests in bodies such as the UN, NATO, and other multilateral institutions.
The U.S.-UK political relationship encompasses an extensive network of individuals from across
the public and private sectors. Relationships between the individual national leaders, however, are
often analyzed by some observers as emblematic of countries’ broader political relations.
5
See Charles Grant, How Britain could leave the EU, Centre for European Reform,
http://www.cer.org.uk/sites/default/files/publications/attachments/pdf/2012/bulletin87_cg_article1-6671.pdf
6
James Kirkup, “Half of British voters ‘would choose to leave the EU in referendum,” The Daily Telegraph,
November 9, 2012.
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Former Prime Minister Tony Blair established a close personal relationship with both President
Bill Clinton and President George W. Bush. The degree to which the UK subsequently influenced
U.S. policy choices in the war on terrorism, Iraq, and other issues has been a topic of much debate
on both sides of the Atlantic. Some observers contend that Blair played a crucial role in
convincing the Bush Administration to initially work through the United Nations with regard to
Iraq; that the priority Blair placed on resolving the Israeli-Palestinian conflict helped keep that
issue on the Bush Administration’s radar screen; and that the UK was instrumental in pressing for
a meaningful international peacekeeping presence in Afghanistan, which resulted in the creation
of the NATO-led International Security Assistance Force (ISAF).
Critics, however, charge that Blair and the UK got little in return for their support of controversial
U.S. policies, pointing out that Blair was unable to prevent the United States from abandoning
efforts to reach a comprehensive international consensus regarding Iraq; that little progress was
made on the Israeli-Palestinian conflict; and that the U.S. response to Blair’s initiatives on issues
such as African development and climate change was tepid at best. Impressions of U.S.
preponderance formed in 2002-2003 have caused many to characterize the UK as the “junior”
partner in the relationship, and to note that the relationship has often appeared to be more
“special” to the UK than it is to the United States.
Blair paid a high political price with the British public and within his own Labour Party for his
close alliance with President Bush. The Blair-Bush years also launched debate in the UK about
whether future British prime ministers might think twice about boldly supporting controversial
U.S. policies or make more explicit demands of the United States as the price for support. Some
British observers became anxious to assert that British national interests come first in deciding
British policy, that these interests are not always identical to U.S. national interests, and that the
UK should not be overly deferential to the United States in foreign policy issues.
Upon taking over as prime minister in 2007, Gordon Brown attempted to maintain the “special
relationship” and made no major substantive changes in relations with the United States: he
maintained the UK’s commitment to a strong counterterrorism policy and to the mission in
Afghanistan, even if he proceeded with the planned withdrawal of British forces in Iraq, which
raised some questions and concerns among U.S. policymakers.
Prime Minister Brown pursued close relations with President Obama, but sensing that that some
aspects of Brown’s initial reception by the U.S. President seemed ambivalent, critics speculated
about how much enthusiasm Obama felt about the bilateral relationship. Over the past four years,
some observers have continued to comment on what they have perceived as President Obama’s
lukewarm attitude toward the British. Some observers have argued that Obama is the first postwar U.S. President with no sentimental attachments to Europe: as U.S. foreign policy priorities
focus increasingly on the Middle East and Asia, some argue that Europe, including the UK, faces
a growing struggle to remain relevant in U.S. eyes. In 2009, media reports that Brown had been
“rebuffed” in numerous attempts to meet with Obama over the course of the year heightened
anxiety in the UK about the future of the “special relationship” and how it was viewed by the
Obama Administration. On the other hand, some observers assert that certain sources—in
particular the British media—tend to read too much into the appearance of personal relations
between the individual leaders, noting that the functional aspects of the U.S.-UK political
relationship run much broader and deeper.
In any case, some of the anxieties about the relationship were at least partially dissipated during
President Obama’s state visit to the UK in May 2011, during which he repeatedly reaffirmed its
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importance.7 Prime Minister Cameron came to the United States in March 2012 in a visit
designed to reaffirm U.S.-UK ties and the personal relationship between Cameron and Obama.
The two leaders discussed cooperation on a broad range of international issues and President
Obama hosted the prime minister at a state dinner.
Defense Relations
U.S. defense planners view the UK as one of the most capable European allies—if not the most
capable—in terms of well-trained combat forces and the ability to deploy them. Observers also
note that the United States and the UK tend to have similar outlooks on issues such as the use of
force, the development of military capabilities, and the role of NATO. Beyond the political bonds
of similar interests and values, some experts suggest that the United States has been more inclined
to listen to the UK than to other European allies because of the UK’s more significant military
capabilities and willingness to use them against common threats.
During the Cold War, the UK served as a vital base for U.S. forces and continues to host about
9,000 U.S. military personnel as well as airbases, equipment, radar sites, and intelligencegathering installations. U.S. and British forces have also established extensive liaison, training,
and exchange arrangements with one another, with British officers routinely seconded to, for
example, the Pentagon, U.S. Central Command Headquarters in Tampa, FL, and U.S. Naval
Headquarters in Norfolk, VA. British sources reportedly often have access and input into U.S.
defense planning and efforts such as Quadrennial Defense Reviews and the 2009 U.S. Strategic
Review on Afghanistan and Pakistan.8
A 1958 U.S.-UK Mutual Defense Agreement established unique cooperation with regard to
nuclear weapons, allowing for the exchange of scientific information and nuclear material. The
United States has supplied Britain with the missile delivery systems for its nuclear warheads since
1963. The UK’s nuclear deterrent currently consists of several Vanguard class submarines, each
armed with up to 16 Trident missiles. Although the Liberal Democrats campaigned for phasing
out the UK’s nuclear role, the Conservatives support maintaining Trident, and the coalition plans
to continue with the maintenance and updating of the UK’s nuclear weapons.
The United Kingdom and the United States are also key partners in terms of defense industry
cooperation and defense sales. The two countries are engaged in more than 20 joint equipment
programs, including the Joint Strike Fighter (JSF). U.S. foreign military sales (government-togovernment) agreements with the UK were $1.8 billion in FY2010 and $537 million in FY2011.9
Shipment of U.S. direct commercial sales (contractor-to-government) to the UK totaled nearly
$588 million in FY2010 and $489 million in FY2011.10
7
Gordon Rayner, "Barack Obama in London: president pays tribute to 'enduring bond'," The Daily Telegraph, May 24,
2011.
8
See, for example, House of Commons Foreign Affairs Committee, Global Security: UK-US Relations, March 18,
2010, pp. 23-24.
9
Defense Security Cooperation Agency, Fiscal Year Series, http://www.dsca.mil/programs/bizops/factsbook/Fiscal%20Year%20Series%20-%2030%20September%202011.pdf.
10
U.S. Department of State, Section 655 Annual Military Assistance Reports,
http://www.pmddtc.state.gov/reports/655_intro.html.
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The United States is the largest overseas supplier of the UK Ministry of Defense. The UK, in turn,
is the largest overseas supplier to the U.S. Department of Defense, and the United States is the
UK’s second-largest defense market overall (behind Saudi Arabia). The United States, however,
acquires a relatively small proportion of its defense equipment from overseas: the balance of
U.S.-UK defense exports is about 2 to 1 in favor of the United States. Most major U.S. defense
companies have a UK presence and, led by BAE Systems, numerous British companies operate in
the United States. British defense companies’ U.S. operations tend to be part of a larger supply
chain, with sales consisting mostly of components and niche equipment, rather than entire
platforms.11
In 2007, in an effort to address long-standing British concerns about U.S. technology-sharing
restrictions and export controls, the countries signed a Treaty Concerning Defense Trade
Cooperation. The U.S. Senate passed a resolution of advice and consent to ratification of the
treaty in September 2010.12 The treaty eliminates individual licensing requirements for certain
defense articles and services controlled under the U.S. International Traffic in Arms Regulations
(ITAR). The agreement is reciprocal and is intended to cover defense equipment for which the
U.S. and UK governments are the end-users. It also calls for the creation of “approved
communities” of companies and individuals in each country with security clearances to deal with
technological transfers.13
Austerity and the Defense Budget
In 2011, the UK had the world’s third-largest military expenditure (behind the United States and
China, and just ahead of France), spending approximately £39.65 billion (about $63.6 billion).
The UK is also one of the few NATO countries that exceeds the alliance’s tacit defense spending
benchmark of 2% of GDP (the UK’s defense spending was 2.6% of GDP in 2011).14
In October 2010, the UK government released a Strategic Defense and Security Review (SDSR),
the country’s first such review since 1998, that sets out the future structure of British military
forces.15 The SDSR lays out a vision for a restructured British military by the year 2020 that is
smaller but highly flexible, maintains a high degree of readiness, and offers the full range of
needed capabilities. Fiscal pressures are expected to have a substantial impact on the British
military, however: the SDSR called for an 8% decrease in the UK’s defense spending over the
period 2011 to 2015.16 The Ministry of Defence is expected to cut 25,000 civilian jobs over the
11
See House of Commons Foreign Affairs Committee, op. cit., pp. 25, Ev111-Ev112.
The treaty is numbered 110-7.
13
The full text of the treaty can be accessed at http://www.state.gov/t/pm/rls/othr/misc/92770.htm. Also see Claire
Taylor, UK-US Defence Trade Co-operation Treaty, House of Commons Library, International Affairs and Defence
Section, February 17, 2009, http://www.parliament.uk/briefing-papers/SN04381.
14
NATO Public Diplomacy Division, Financial and Economic Data Relating to NATO Defence, April 13, 2012,
http://www.nato.int/nato_static/assets/pdf/pdf_2012_04/20120413_PR_CP_2012_047_rev1.pdf.
15
HM Government, Securing Britain in an Age of Uncertainty: The Strategic Defence and Security Review, October
2010,
http://www.direct.gov.uk/prod_consum_dg/groups/dg_digitalassets/@dg/@en/documents/digitalasset/dg_191634.pdf?
CID=PDF&PLA=furl&CRE=sdsr.
16
The 8% decrease is in real terms (inflation-adjusted).
12
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period, to close or sell off some of its facilities, and to renegotiate some contracts with private
industry. Cuts will also affect each branch of the British military:17
•
The British Army will be reduced by 7,000 personnel, down to 95,500 personnel by 2015.
The army’s tank force will be reduced by 40% and heavy artillery by 35%. By 2020, the
army is expected to shrink to 82,000 regulars.
•
Royal Navy personnel will be cut by 5,000, to a total of 30,000 by 2015. The navy
decommissioned the aircraft carrier Ark Royal four years ahead of schedule and phased
out its Harrier jump jets. Two new aircraft carriers that have already been commissioned
will be completed, but only one will enter immediately into service, with the other placed
on “extended readiness.” Given the phase-out of the Harriers and the timetable for the
acquisition of naval variant F-35s, the UK will not have a carrier-based strike aircraft
capability until 2019. The navy will acquire a new fleet of Astute-class attack submarines
and six new Type 45 destroyers, but the surface fleet of destroyers and frigates will drop
from 23 ships to 19 by 2020.
•
The Royal Air Force will lose 5,000 personnel, decreasing to 35,000 by 2015. In addition
to recently-acquired EuroFighter Typhoons and plans to procure F-35s, the RAF intends
to acquire 12 new Chinook helicopters. Plans to replace Nimrod surveillance aircraft
have been cancelled.
•
The government intends to maintain the UK’s submarine-based Trident nuclear deterrent,
but to reduce the total UK warhead stockpile from 160 to under 120, and to decrease the
number of warheads on each submarine from 48 to 40. A decision on replacing Trident
submarines will be taken in 2016.
The cuts to the defense budget are not expected to affect on-going British military operations,
which are funded separately by a treasury reserve. Nevertheless, U.S. officials including
Secretary of State Hillary Clinton and former Secretary of Defense Robert Gates have expressed
concerns about the impact of the UK’s defense cuts on transatlantic cooperation and burdensharing.18 In addition, an August 2011 report by House of Commons Select Defence Committee
also raised alarms about the impact cuts would have on the UK military’s ability to carry out
operations, stating that “We are not convinced, given the financial climate and the drawdown of
capabilities arising from the SDSR, that from 2015 the Armed Forces will maintain the capability
to undertake all that is being asked of them.”19
The UK in Afghanistan
The UK continues to be the second-largest troop contributor to the NATO-led International
Security Assistance Force (ISAF) mission in Afghanistan. As of early December 2012, the UK
17
"Defence review: Cameron unveils armed forces cuts," BBC News, October 19, 2010,
http://www.bbc.co.uk/news/uk-politics-11570593.
18
Nicholas Watt, "Hillary Clinton 'worried' by UK defence cuts," The Guardian, October 15, 2010,
http://www.guardian.co.uk/politics/2010/oct/14/hillary-clinton-uk-defence-cuts.
19
Defense Committee – Sixth Report, The Strategic Defence and Security Review and the National Security Strategy,
http://www.publications.parliament.uk/pa/cm201012/cmselect/cmdfence/761/76102.htm.
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had 9,500 British troops deployed to ISAF.20 Most British forces are based in the province of
Helmand, where they have engaged in frequent combat with insurgents. The UK military has
suffered over 430 combat deaths in Afghanistan, which is more than twice the number of
casualties the UK had in Iraq.
By and large, the UK has concurred with the Obama Administration’s Afghanistan strategy, and
British sources have reportedly had significant input into elements of U.S. strategic review. Points
of agreement have included focusing on Afghan army and police training and civilian efforts
regarding governance, rule of law, and economic development. Some British officials and
observers have long asserted that the key to defeating the insurgency lies in political solutions and
incentives aimed at militants who may not be motivated by radical Islamist ideology, and some
have long advocated negotiations with the more moderate elements of the Taliban.
The United States and the UK have been leading the formulation of allied strategy for the
transition in Afghanistan and the coordinated drawdown of ISAF troops. At NATO’s Chicago
Summit in May 2012, President Obama and Prime Minister Cameron urged the allies to remain
committed to a transition timetable calling for the transfer of security responsibility to Afghan
forces in 2013, and a gradual withdrawal of combat troops to be completed by the end of 2014.
In December 2012, Prime Minister Cameron announced that 500 British soldiers would withdraw
by the end of the year, followed by an additional 3,800 during the course of 2013, leaving 5,200
British soldiers in Afghanistan by the end of 2013. The full withdrawal of combat troops is to be
completed by the end of 2014, with an undetermined number of British troops remaining after
2014 in non-combat training and support roles.21 Some commanders in the British military have
reportedly urged a slower and more cautious withdrawal pace.
In January 2012, the UK and Afghanistan concluded a strategic partnership agreement that
outlines the countries’ relationship beyond 2014, including a continued UK commitment to
training and economic development. The UK intends to continue spending approximately £70
million (approximately $112 million) per year training and equipping Afghan forces. The UK is
also the largest European donor of bilateral economic and development aid to Afghanistan,
budgeting an average of £178 million (about $285 million) per year for the period 2011-2015.22
The UK also strongly supports a regional approach to Afghanistan that includes Pakistan. Former
Prime Minister Brown stated that three-quarters of the terrorist plots uncovered in the UK have
their roots in the Afghanistan-Pakistan border region. The UK is helping train and equip Pakistani
forces for counter-insurgency operations along the Afghan border and budgeted £665 million
(approximately $1 billion) in aid to Pakistan over the period 2009-2013.
Intelligence and Counterterrorism Cooperation
Most analysts and officials agree that U.S.-UK intelligence and counterterrorism cooperation is
close, well-established, and mutually beneficial. UK agencies routinely cooperate with their U.S.
counterparts in the sharing of information, and U.S. and British law enforcement and intelligence
20
NATO, ISAF placemat, December 3, 2012.
UK Ministry of Defence, Prime Minister announces reduction in UK troop numbers in Afghanistan, December 19,
2012, https://www.gov.uk/government/news/prime-minister-announces-reduction-in-uk-troop-numbers-in-afghanistan.
22
Department for International Development (DFID), Afghanistan Operational Plan 2011-2015.
21
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agencies regularly serve as investigative partners. According to the UK Foreign Office, the U.S.UK intelligence and law enforcement relationship “far outstrips the level of interaction and cooperation with other nations.”23 Although many of the details and achievements remain secret,
U.S.-UK intelligence and counterterrorism cooperation has reportedly disrupted multiple terrorist
operations against both countries in recent years, including a plot against the New York Stock
Exchange and World Bank in 2004, a major plot against transatlantic aviation in 2006, and a
cargo airplane bomb plot in 2010.24 In addition to efforts seeking to disrupt terrorist attacks
against U.S. and European targets, U.S. and UK officials work together with regard to
developments in countries such as Afghanistan, Pakistan, Somalia, and Yemen.
Although the overall intelligence and counterterrorism relationship is overwhelmingly positive,
there have been some occasional tensions. The relationship was damaged by public accusations of
British complicity in U.S.-led renditions and the alleged torture of terrorist suspects between 2002
and 2008. Related court cases sought the release of intelligence documents and raised concerns in
the intelligence community about the risk of confidential information entering the public domain
through the British legal system.
There have also been some tensions about extradition arrangements. Although the UK extradited
radical Islamist cleric Abu Hamza al-Masri to the United States in October 2012 to face trial on
terrorism-related charges, U.S. officials were frustrated that the process took eight years after the
original U.S. request. For its part, the British government has faced criticism over the country’s
extradition arrangements from some who argue that British citizens should have evidence against
them considered in British courts before extradition to another country. Some British observers
have repeatedly pointed out, for example, that under current arrangements U.S. prosecutors
seeking an extradition are not required to present supporting evidence in their request. U.S.
officials were also frustrated in October 2012 when UK Home Secretary Theresa May blocked
the extradition of Gary McKinnon, a computer hacker indicted by a U.S. grand jury for allegedly
disrupting U.S. military and government computer networks in 2001-2002. Citing McKinnon’s
mental health conditions, including Asperger’s syndrome and schizophrenia, May asserted that
extradition and trial in the United States would amount to a violation of his human rights.
Economic Relations
The U.S.-UK bilateral investment relationship is the largest in the world. According to 2010
estimates, (most recent data available) the cumulative total of UK corporate assets invested in the
United States stood at nearly $2.2 trillion, with UK foreign direct investment (FDI) in the United
States topping $430 billion for that year. Total U.S. corporate assets in the UK were $4.4 trillion,
with 2010 U.S. FDI in the UK exceeding $508 billion. UK affiliates employed over 900,000 U.S.
workers, and U.S. firms employed nearly 1.2 million people in the UK.25
The global financial crisis and recession had a significantly negative impact on world trade and
investment flows. Both the United States and the UK are home to major world financial centers,
and the U.S.-UK economic relationship was affected. British banks suffered massive losses from
23
House of Commons Foreign Affairs Committee, op. cit., p. Ev 61. See also pp. 39-42.
See British Prime Minister’s Office, US and UK Counterterrorism Cooperation,
http://www.number10.gov.uk/news/counterterrorism-cooperation/.
25
Daniel S. Hamilton and Joseph P. Quinlan, Center for Transatlantic Relations, Johns Hopkins University School of
Advanced International Studies, The Transatlantic Economy 2012: Volume 2, pg. 54.
24
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their exposure to asset-based securities linked to the U.S. sub-prime mortgage market.
Transatlantic FDI flows fell sharply from 2007 to 2009, but rebounded strongly in 2010.26
Tourism and trade are also important pillars of the economic relationship. In 2010, 2.71 million
Americans visited the UK and 3.85 million Britons visited the United States. In 2011, U.S.
exports of goods and services to the UK were worth $56 billion, and U.S. imports from the UK
were worth $51.2 billion.27
The European Commission negotiates a common EU trade policy on behalf of its member states,
and therefore UK trade policy is formulated within an EU context. Although most of the U.S.-EU
economic relationship is harmonious, some tensions persist. Current U.S.-EU trade disputes focus
on poultry, aircraft subsidies, hormone-treated beef, and genetically modified (GM) food
products. The UK has been a consistent supporter of U.S.-EU efforts to lower transatlantic and
global trade barriers, and to reach an agreement in the Doha Round of multilateral trade
negotiations.
Conclusion
Most analysts agree that the U.S.-UK political relationship is likely to remain intimate; that the
“special relationship” will remain strong on many vital issues in which the UK is a crucial U.S.
ally; and that the two countries will remain key economic partners. Observers also assert that the
main dimensions of the U.S.-UK relationship are deep and enduring in that they go beyond the
personal dynamics of individual leaders and are not subject to sudden moves or policy shifts by
either country. Analysts observe that many concerns and assertions about an impending break-up
of the “special relationship” tend to be exaggerations.
Nevertheless, many analysts believe that some reassessment of the “special relationship” may be
in order. Despite its dominant themes of continuity, the relationship is changing primarily because
its geopolitical setting has been changing. The U.S.-UK relationship often remains uniquely close
and capable of projecting a considerable degree of power and influence, but there are questions
about whether the relative influence and centrality of the relationship is facing a decline. Both
countries have sought to adjust their foreign policy approaches to deal with new global challenges
and emergent geopolitical trends that are often perceived as the “rise of new powers” or the
diffusion of power away from “the West.” In many cases, responses to global challenges continue
to reinforce not only the relevance of U.S.-UK cooperation, but the still-frequent role played by
the two countries working together to drive international action. In an increasingly “G-20 world,”
however, the UK may not be viewed as centrally relevant to the United States in all of the issues
and relations considered a priority on the U.S. agenda.28
Similar to the United States, the key long-term foreign policy challenges for the UK are likely to
revolve around how to define its relationships with emerging powers; how to maintain global
influence and relevant capabilities given limited resources; and how to maximize existing
partnerships (including with the United States) and multilateral frameworks (including NATO, the
26
Daniel S. Hamilton and Joseph P. Quinlan, op. cit., pp. 7-8.
U.S. Department of State, Background Note: United Kingdom, March 22, 2012.
28
See, for example, the November 11, 2009, testimony of Dr. Robin Niblett in House of Commons Foreign Affairs
Committee, op. cit., p. Ev 3.
27
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EU, and the United Nations).29 Meanwhile, many observers assert that a significant degree of the
UK’s international influence flows from the success and dynamism of the British economy; for
the foreseeable future, the UK’s central domestic priority will remain a combined pursuit of
stronger economic growth and ambitious fiscal consolidation.
The management of the UK’s relations with the EU will also bear watching over the next several
years. Some analysts argue that life on the margins of an EU more integrated around the
Eurozone need not be disastrous for the UK. Both the positive and the negative aspects of a
prospective life outside the EU are more difficult to foresee, however. Envisioning an EU without
the UK, many analysts observe that British participation is widely regarded as essential for efforts
to development more robust EU foreign and defense policies. Analysts also assert that the
departure of the UK could change the economic character of the EU because the UK generally
acts as a leading voice for economic liberalism in EU debates about trade and the single market.
As was reportedly expressed in December 2012 during a videoconference between President
Obama and Prime Minister Cameron and related bilateral discussions between U.S. and UK
officials, these considerations are of central interest to U.S. policymakers who are concerned
about a potential UK departure from the EU.30 With the UK commonly regarded as the strongest
U.S. partner in Europe and a partner that commonly shares U.S. views, senior Administration
officials reportedly conveyed their concerns that a UK break from the EU would reduce U.S.
influence in Europe, weaken the EU’s position on free trade, and make the EU a less reliable
partner on security and defense issues.
Author Contact Information
Derek E. Mix
Analyst in European Affairs
dmix@crs.loc.gov, 7-9116
29
30
See HM Government, A Strong Britain in an Age of Uncertainty: The National Security Strategy, October 2010.
Alex Spillius, “Britain will be weaker without EU, says USA,” The Daily Telegraph, December 18, 2012.
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