The United States and Europe: Current Issues
Derek E. Mix
Analyst in European Affairs
August 5, 2009
Congressional Research Service
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The United States and Europe: Current Issues
Summary
Overlapping values and shared interests give the United States and Europe what some observers
consider to be the world’s most complete partnership. In terms of security and prosperity, analysts
assert that the two sides have grown increasingly interdependent. Transatlantic relations during
the Bush Administration were marked by tensions over the invasion of Iraq and disagreements on
a number of other issues, although the Administration’s second term featured a substantial
improvement in the relationship compared to the first four years. The majority of Europeans
warmly welcomed President Barack Obama to office, and his popularity may present
opportunities for the United States and Europe to address the common set of global challenges
they face. Prior to the 2008 U.S. election, European leaders outlined their priorities for U.S.-
European cooperation as the Middle East peace process, civil-military cooperation in
Afghanistan, relations with Russia, and multilateral diplomacy through the United Nations and
other international organizations. Transatlantic cooperation is strong on many such key issues, but
some divisions, tensions, and shortcomings also exist.
A number of shared foreign-policy challenges involve the wider Middle East region. In
Afghanistan, governance and security conditions remain serious concerns. President Obama is
shifting U.S. focus to Afghanistan, and Europe’s commitment to the stabilization and
reconstruction mission there will continue to be an important tone setter in transatlantic relations.
With a nuclear Iran deemed an unacceptable danger to regional stability by many officials and
analysts, the United States and the European Union (EU) continue to seek a way to halt Iran’s
uranium enrichment activities in the wake of that country’s disputed election. The United States
and the EU have renewed their attention to the Israeli-Palestinian conflict, and both advocate the
negotiation of a “two-state” political settlement. Many experts, however, observe that current
circumstances do not easily lend themselves to a revived peace process.
A range of other issues also rank high on the transatlantic agenda. With the world economy center
stage in 2009, the global financial crisis poses difficult challenges to both sides and has raised
concerns about the adoption of protectionist policies. While some transatlantic trade disputes
persist, efforts are ongoing to reduce non-tariff barriers and increase regulatory convergence.
Europe has set ambitious standards in climate change policy. With expectations that the
Copenhagen conference in December 2009 might produce a successor treaty to the Kyoto
Protocol, many Europeans hope that the United States will adopt new climate change legislation
that could contain binding greenhouse gas emissions targets. U.S.-EU counterterrorism
cooperation has been strong since the terrorist attacks of 9/11, although some Europeans have
objected to aspects of U.S. policies. The planned closure of the Guantánamo Bay detention
facility has been applauded in Europe, although U.S. requests to accept released detainees have
raised questions and debate. The decision to admit additional EU countries to the U.S. Visa
Waiver Program in late 2008 helped defuse European discontent over visa reciprocity issues.
Lastly, relations between the West and Russia have grown increasingly tense in recent years, with
issues such as energy and missile defense serving as points of irritation and contention. Common
approaches to Russia—among U.S. policymakers, within Europe, and across the Atlantic—have
proven difficult to formulate. This report examines the current state of the transatlantic
relationship and discusses the key issues outlined above, which may have implications for U.S.
interests during the 111th Congress.
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The United States and Europe: Current Issues
Contents
The Current State of U.S.-European Relations ............................................................................. 1
The Ties That Bind................................................................................................................ 1
An Evolving Relationship ..................................................................................................... 1
Key Issues in U.S.-European Relations........................................................................................ 3
Afghanistan .......................................................................................................................... 3
Iran....................................................................................................................................... 4
Israeli-Palestinian Conflict .................................................................................................... 5
Russia ................................................................................................................................... 6
Counterterrorism................................................................................................................... 8
Climate Change .................................................................................................................... 9
Economic Relations ............................................................................................................ 10
Regulatory Cooperation and the Transatlantic Economic Council .................................. 11
Visa Waiver Program .......................................................................................................... 12
Contacts
Author Contact Information ...................................................................................................... 13
Acknowledgments .................................................................................................................... 13
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The United States and Europe: Current Issues
The Current State of U.S.-European Relations
The Ties That Bind
Overlapping values and shared interests give the United States and Europe what some observers
describe as the world’s most complete partnership.1 By almost any measure, the institutional
pillars of the Euro-Atlantic community—NATO and the European Union (EU)—have proven a
great success in promoting prosperity, security, and stability in Europe. The U.S. Congress and
successive U.S. administrations have strongly supported both institutions as means to foster
democratic states, reliable military allies, and strong trading partners.
Many observers stress that in terms of security and prosperity the United States and Europe have
grown increasingly interdependent. Both sides of the Atlantic face a common set of challenges,
including terrorism and transnational crime, weapons proliferation, energy security, climate
change and environmental degradation, the destabilizing effects of failing and rogue states, and
instability in global financial markets. Both sides are proponents of democracy, open societies,
human rights, and free markets. Supporters of close U.S.-European cooperation argue that neither
the United States nor Europe can adequately address such an agenda alone, and that the track
record shows that the two sides can accomplish much more when they work together.
Together, U.S. and European military forces are promoting stability in Afghanistan and the
Balkans, and U.S. and European law enforcement authorities are working to uncover terrorist
cells in Europe and elsewhere. The United States and the EU also share a mutually beneficial
trade and investment relationship, and U.S.-EU cooperation has been critical in liberalizing the
world trading system. The global financial crisis and recession is affecting the transatlantic
economic relationship and could test the strength of the political relationship.
This report discusses eight broad topics selected as key issues in U.S.-European interests and
relations. A full survey of global issues that are important U.S. and European interests would
include relations with countries such as China, India, and Turkey; concerns about stability in the
Balkans and the countries of the former Soviet Union; development assistance and humanitarian
aid to the countries of Africa and elsewhere in the developing world; promotion of democracy
and human rights around the globe; and many more. While not every such important topic is
covered in this report, the eight issues that are presented are intended to capture a broad overview
of some of the highest-priority items on the transatlantic agenda.
An Evolving Relationship
In 2003-2004, transatlantic and inter-European divisions over the invasion of Iraq pushed
relations to an historic low. Although the second term of President George W. Bush featured a
marked improvement in the tone of transatlantic relations and close U.S.-European cooperation in
a number of important areas, scars of tension over Iraq—as well as U.S. rejection of the Kyoto
climate treaty, the “war on terror,” U.S. opposition to the International Criminal Court, and other
issues—were slow to fade. Many Europeans perceived the policies of the Bush Administration as
1 See, for example, Simon Serfaty, The Vital Partnership (Lanham, MD: Rowman & Littlefield, 2005).
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being too unilateral, too reliant on military force, and too dismissive of international treaties and
norms.
President Barack Obama is popular in Europe, and European expectations are high that the
Obama Administration will pursue a multilateral and consultative foreign policy that relies more
on diplomacy and instruments of soft power and less on military force.2 Some commentators
warn of the dangers of exaggerated expectations. They warn that just as the United States should
be reasonable in what it can expect out of Europe, Europeans will need to be realistic regarding
the degree of change President Obama might deliver in terms of U.S. strategy and policy.
The gradual evolution of the European Union adds layers of complexity to transatlantic relations.
The competencies of the EU extend from a wide range of economic and social issues, through the
still-nascent Common Foreign and Security Policy (CFSP) and European Security and Defense
Policy (ESDP), and into law enforcement and judicial matters. On many of these issues, the U.S.-
EU relationship is now more important than the U.S. bilateral relationships with any of the 27
individual EU member states.
EU leaders are pushing for the adoption of the Lisbon Treaty later this year. The treaty would
streamline institutional arrangements and decision-making procedures, and introduce reforms for
a stronger and more coherent political and foreign policy voice. Elections for a new European
Parliament were held in June 2009, and a new European Commission is expected to take office in
the Fall. While the identities and influence of individual member states and regions will
undoubtedly remain strong, integration has slowly created an emerging European identity among
Europe’s citizens.
NATO, too, is often said to be in the midst of a significant evolution. Since the end of the Cold
War, the Alliance has added 12 new member states from central and eastern Europe. Also during
this time, NATO has sought to redefine its mission. Some members maintain that NATO should
return to focusing on collective territorial defense and deterrence, while others believe NATO’s
relevance depends on “out-of-area” expeditionary operations.
While NATO has worked to transform itself and develop new capabilities, most observers
contend that more resources are needed should NATO decide to fully commit itself to challenges
such as stabilization and reconstruction operations, crisis management, counterterrorism, energy
security, and cyber security. Following the April 2009 summit marking NATO’s 60th anniversary,
a new NATO Strategic Concept is being prepared that is expected to provide an updated vision
for the Alliance.
2 See Pew Global Attitudes Project, Confidence in Obama Lifts U.S. Image Around the World, July 23, 2009, pp. 31-41.
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Key Issues in U.S.-European Relations
Afghanistan3
President Obama has put Afghanistan at the top of his Administration’s foreign policy priorities,
and is shifting U.S. military and strategic focus to the mission there. Europe’s commitment to
maintaining its participation will continue to be an important tone setter in transatlantic relations.
NATO’s International Security Assistance Force (ISAF) is a stabilization mission that supports
the reconstruction of Afghanistan and the development of the Afghan government, army, and
police. ISAF consists of approximately 64,500 troops from 42 countries, including all 28
members of NATO.4 More than seven years after the fall of the Taliban, however, the Afghan
economy, security forces, and central government remain well short of self-sufficiency. A resilient
Taliban and other insurgent groups continue to undermine stability in many areas of the country,
and the rate of violent incidents nationwide has been increasing from year to year. Many officials
and expert observers on both sides of the Atlantic assert that success or failure in Afghanistan
hangs in the balance, and that the next two or three years will be decisive.
In addition to the approximately 40,000 U.S. troops in Afghanistan, the United States is sending
21,000 more reinforcements this Summer. U.S. and NATO officials have repeatedly called for
greater troop and equipment contributions from some of the European allies. At the NATO
Summit in April, European countries reportedly pledged a temporary increase of about 5,000
troops and military trainers to increase security for the Afghan elections scheduled to take place
in August. Many European countries have argued that they face difficult constraints on making
further commitments, including shortfalls in military resources and capabilities, and weak public
or parliamentary support for additional contributions. U.S. officials have indicated that pressuring
Europe to send more troops will not be a priority in the near future.
The use of “national caveats”—restrictions that some governments place on their troops to
prevent them from engaging in combat operations—has been a sore spot within the Alliance.
Critics assert that such policies could lead to a two-tiered NATO, with some member states
providing combat troops and others providing peacekeepers and development assistance. Some
discern this trend in the fact that U.S., UK, Dutch, and Canadian troops bear the vast majority of
combat in the country’s most volatile regions. Some European countries are concerned that
greater “Americanization” of the mission could come at the expense of Allied input and
consultation in strategic decision making.
In the spring, the U.S. Administration completed its strategic review of policy for Afghanistan
and Pakistan. The review concluded that economic development, building Afghan governance
capacity, and improving the capability of Afghan security forces are major priorities. European
leaders expressed broad support for these conclusions. Some experts have long suggested that
Europe has much to offer in these terms, calling for a greater contribution of civilian expertise.
3 For more information see CRS Report RL33627, NATO in Afghanistan: A Test of the Transatlantic Alliance, by
Vincent Morelli and Paul Belkin and CRS Report RL30588, Afghanistan: Post-Taliban Governance, Security, and U.S.
Policy, by Kenneth Katzman.
4 As July 23, 2009, “International Security Assistance Force and Afghan National Army strength & laydown,” NATO
website, http://www.nato.int/isaf/docu/epub/pdf/placemat.pdf.
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The strategic review also concluded that any solution in Afghanistan requires a comprehensive
regional strategy that incorporates Pakistan as well. With insurgent groups using cross-border safe
havens to launch attacks on coalition forces, the United States and Europe have come to
increasingly realize that security in Afghanistan is also linked to sources of instability facing the
Pakistani government. In this context, U.S. and European security, political, and economic
relations with Pakistan have become a high priority.
Iran5
Transatlantic cooperation regarding Iran has been close and extensive, with Europe in a leading
role in terms of direct negotiations with Tehran. The United States and the European Union are
seeking to halt Iran’s uranium enrichment activities, which continue in defiance of the
international community. Iran asserts that its nuclear activities are for peaceful, civilian energy
purposes and that it has the right to develop such capabilities.
Although the 2007 U.S. National Intelligence Estimate (NIE) concluded that Iran suspended its
nuclear weapons program in 2003, the United States and European governments maintain that
Iran’s ongoing enrichment of uranium gives it the potential to assemble nuclear weapons in a
relatively short span of time. The International Atomic Energy Agency (IAEA) continues to
complain of Iranian noncooperation in monitoring and inspections, and states that it cannot verify
that Iran’s nuclear activities are strictly for peaceful purposes. Given the current Iranian
government’s hostility and inflammatory rhetoric towards Israel and the United States, its
development of ballistic missiles capable of reaching Israel and Europe, and its support for
Hezbollah, Hamas, and insurgent groups in Iraq, many officials and analysts consider a nuclear
Iran an unacceptable danger to regional stability.
Since the discovery of Iran’s covert nuclear activities in 2002, the “EU-3” (France, Germany, and
the United Kingdom, together with EU foreign policy representative Javier Solana) have led
diplomatic efforts to curtail them. In 2006, China, Russia, and the United States joined the EU-3
to form the “Permanent Five Plus One” (P5+1) negotiating group. The history of negotiations
with Iran consists of a series of proposed incentives packages regarding trade, energy, and
political cooperation, offered in return for the abandonment of uranium enrichment. Since 2006,
such incentive offers have carried the threat of punitive sanctions to be imposed in case of
noncompliance, and on three separate occasions the EU-3 and the United States have successfully
pushed for United Nations Security Council approval of limited sanctions on Iran (Resolutions
1737, 1747, and 1803).
The Obama Administration has indicated that it may be willing to engage in direct talks with Iran.
European leaders welcomed and encouraged the prospect of such direct engagement on the part
of the United States, although emphasizing that it should be closely coordinated within the P5+1
framework (China, France, Germany, Russia, the United Kingdom, and the United States).
Following the controversial and disputed re-election of Iranian President Mahmoud Ahmadinejad
in June, however, the prospects for such negotiations are increasingly in doubt. While the U.S.
Administration has taken a relatively cautious overall approach to post-election developments in
Iran, European leaders (and the U.S. Congress) were more outspoken from the outset in
condemning the regime’s behavior. Some observers are wary of how U.S. overtures might impact
5 For more information see CRS Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman.
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perceptions of Ahmadinejad’s legitimacy at this time and some question whether, under the
circumstances, the Iranian government is currently in a position to act as a serious negotiating
partner. Others suggest that this may be an opportune moment to force concessions. In any case,
U.S. officials have called for an answer regarding the offer to talk by September 2009, after
which U.S. policy would pursue further sanctions and pressure.
Although the United States has strongly supported EU-3 efforts in this issue, some Americans
have pointed to European trade and business ties with Iran and urged Europeans to adopt and
enforce tighter sanctions, even if outside the UN framework. The EU and a number of member
countries have taken some such autonomous measures, but many Europeans prefer to work
strictly within the UN process regarding international sanctions. The EU has long opposed the
U.S. Iran Sanctions Act (ISA) as an extraterritorial application of U.S. law. In addition, some
European governments have been concerned that various proposed U.S. legislation aimed at Iran
could harm European energy companies and undermine transatlantic unity in this issue. Bills in
the 111th Congress that would tighten sanctions on Iran, including penalizing gasoline sales to
Iran, include H.R. 2194 and S. 908.
Israeli-Palestinian Conflict6
Israel’s offensive into Gaza in December 2008-January 2009 renewed international attention on
the Israeli-Palestinian conflict. While the United States and the EU advocate the negotiation of a
political settlement, many experts observe that current circumstances do not easily lend
themselves to a revived peace process.
The United States and the EU both believe in a “two-state” solution, a settlement that results in a
sustainable Palestinian state alongside a secure Israel. More broadly, both also recognize that a
settlement to the Israeli-Palestinian conflict is important for stability in the wider Middle East and
in the context of combating Islamic radicalization and terrorism. However, despite the creation in
2002 of the Quartet mechanism for promoting the peace process (consisting of the United States,
the EU, Russia, and the UN) and the Annapolis conference on the peace process in November
2007, many observers maintain that little progress has been made in recent years.
Many Europeans have long considered the Israeli-Palestinian conflict to be the key issue in the
Middle East and have called for more engagement on the part of the United States. The Obama
Administration’s appointment of a special Middle East envoy and its increased engagement with
Syria, a significant regional influence, have been welcomed in Europe as positive signals of U.S.
commitment. In addition, President Obama’s June speech in Cairo and U.S. pressure to halt the
construction of Israeli settlements in the West Bank have created perceptions of a more balanced
U.S. approach among those who believe U.S. policy has historically favored Israel.
Prospects for the peace process are complicated by Hamas’ control over Gaza, which it took over
by force in June 2007 following the collapse of the Hamas-Fatah coalition government. The
United States and the EU classify Hamas as a terrorist organization and have no direct relations
with its leaders.7 The United States and the EU maintain political ties with the Palestinians
6 For more information see CRS Report RL33530, Israeli-Arab Negotiations: Background, Conflicts, and U.S. Policy,
by Carol Migdalovitz.
7 See the U.S. State Department foreign terrorist organizations (FTO) factsheet, April 8, 2008, and the EU list of
terrorist group and individuals, January 26, 2009 (Council Common Position 2009/67/CFSP).
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through the Fatah-led Palestinian Authority (PA), which governs the West Bank and is headed by
President Mahmoud Abbas. Some have suggested the formation of a Palestinian unity
government under Abbas’ leadership that would carry on negotiations with Israel, although
Hamas’ role in any such government would likely be problematic. Egypt has been moderating
talks between Fatah and Hamas on the future of the Palestinian government. The equation is
further complicated by the right-wing coalition government led by Benjamin Netanyahu that was
formed after Israel’s February 2009 election. Although Netanyahu has indicated willingness to
pursue the peace process under certain conditions, many observers are uncertain how his
government intends to proceed regarding a “two-state” solution, and how it will respond to U.S.
and European pressure to halt settlements.
The EU is the largest donor of foreign aid to the Palestinians, operates a police training mission in
the Palestinian Territories (EUPOL COPPS) and is considering restarting its Border Assistance
Mission (EU-BAM), which monitored the Rafah crossing point into Egypt until going into a
standby mode when Hamas took over Gaza. The United States donated more than $700 million
for Palestinian assistance from June 2007-December 2008, and may commit more than $900
million more for reconstructing Gaza and strengthening the Palestinian Authority. Both the
United States and EU take steps to ensure that their aid does not end up with Hamas—aid is
delivered directly to the Palestinian Authority or indirectly to the Palestinian people via the
United Nations Relief and Works Agency (UNWRA), other international organizations, and non-
governmental organizations (NGO). Some experts argue that U.S.-EU efforts to isolate Hamas
have actually increased its domestic standing, and some in Europe view engagement and dialogue
as a better way to eventually steer Hamas towards the more moderate political mainstream.
Russia8
U.S.-Russian relations have grown increasingly tense in recent years, with numerous issues
serving as points of irritation and contention. While many of these tensions with Russia are
shared by European countries, Europe also has more complex and interdependent relationships
with Russia in terms of energy and economics, and EU member states have been unable to agree
on a common approach to their eastern neighbor.
In the aftermath of its August 2008 invasion of Georgia, relations between Russia and the West
reached what some observers consider their lowest point since the end of the Cold War. For some
time, against a background of tensions over Russian opposition to NATO enlargement and
Kosovo’s independence, officials and observers in Europe and the United States have expressed
growing concern about what is perceived as the increasingly authoritarian character of the
Russian government and its assertiveness and quest for influence in the Russian “Near Abroad”
and beyond.
Missile defense and energy have become central issues in relations with Russia, issues that have
had a divisive effect within Europe and NATO. Russia has vehemently opposed U.S. plans for
missile defense installations in Poland and the Czech Republic. While the United States has said
that the system would seek to counter the threat posed by Iran, Russia has maintained that it
would weaken the Russian nuclear deterrent. As the Obama Administration studies the future of
the missile defense system, some European leaders have previously called for debate about
8 For more information see CRS Report RL33407, Russian Political, Economic, and Security Issues and U.S. Interests,
coordinated by Jim Nichol.
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moving ahead with it, especially given skepticism about the system’s effectiveness. On the other
hand, many strongly wish to avoid the appearance of a Russian veto over NATO countries’
defense planning.
Regarding energy, the EU as a whole is dependent on Russia for more than one-quarter of its gas
and oil supplies, a number expected to grow substantially over the next 20 years. For some
individual countries, dependence on Russian gas is already much greater.9 Thus, upstream gas cut
offs—as occurred most recently in the dispute between Russia and Ukraine in January 2009—
have major implications for wider European energy security. Although this latest dispute was
nominally about payment, some analysts have described a trend in which Moscow seems willing
to use energy supplies as an instrument of foreign policy. Additionally, in recent years Russia has
been actively engaging in bilateral energy deals with a number of European countries and
acquiring large-scale ownership of European energy infrastructure, while not applying Western
standards of transparency and market reciprocity regarding business practices and investment
policy. There is concern in the United States over the influence that Russian energy dominance
could have on the ability to present European—and, by consequence, transatlantic—unity when it
comes to other issues related to Russia. For this reason, some have expressed the desirability of
decreasing European reliance on Russian energy through diversification of supply, and supported
European steps to develop alternative sources and increase energy efficiency. Analysts have also
advocated the development of a common European energy policy that would push Russia to
introduce more competition and transparency in its energy sector.
The Obama Administration has engaged in a “reset” of relations with Russia. After an initial
meeting with President Medvedev in London in early April, President Obama traveled to Moscow
for a summit in early July. The two sides have reached an agreement allowing the transit of U.S.
military material through Russia to Afghanistan; agreed to set up a Bilateral Presidential
Commission to look jointly at a range of security and economic issues; agreed to increase
military-to-military contact and cooperation; and discussed missile defense, Iran, and North
Korea. There have also been talks about a successor agreement to the Strategic Arms Reduction
Treaty (START), which expires at the end of the year, and increasing cooperation on nuclear
security issues. U.S. concerns and objections remain regarding Russian policy on Georgia,
including its recognition of the breakaway provinces Abkhazia and South Ossetia, Russia’s
unilateral suspension of its obligations under the Conventional Armed Forces in Europe (CFE)
Treaty, and issues of internal governance and human rights. In addition, Russian officials continue
to advocate for talks about a new European security architecture. Some analysts view this
proposal as an attempt to undermine NATO.
Europe, meanwhile, is divided between those who believe in a firm, aggressive stance toward
Russia, and others inclined more toward pragmatism and engagement. Of the former, some see in
Russia a potential threat to the political independence and even territorial sovereignty of
themselves and neighbors, and look to a U.S. approach that robustly guards against Russian
assertiveness. Some argue that energy cutoffs to NATO countries could be considered under
NATO’s Article 5, invoking a collective defense response. Some officials and observers in the
countries of central and eastern Europe and the former Soviet Union have been increasingly vocal
in expressing their concerns about the U.S. “reset” policy. They are concerned that U.S. dealings
with Russia could have effects detrimental to their security interests and to the cohesion of
9 See CRS Report RL34261, Russian Energy Policy Toward Neighboring Countries, by Steven Woehrel and CRS
Report RL33636, The European Union’s Energy Security Challenges, by Paul Belkin.
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NATO. They also fear that improved relations with the United States could embolden Russia in its
actions toward neighbors, leading in turn to regional instability.
Advocates of engagement, on the other hand, assert that the maintenance of extensive ties and
constructive dialogue is the most effective way to influence Russia. They argue that Russia
should be viewed as a strategic partner and observe that Russian cooperation is important on
issues such as Iran, climate change, and arms control.
Counterterrorism
In the years since September 11, 2001, U.S. counterterrorism cooperation with the EU and
individual European countries has been strong. Although significant aspects of the Obama
Administration’s policies on terrorism and detention remain works in progress, new U.S.
initiatives that have been introduced or are being considered seem to have diminished some
European concerns and objections over U.S. counterterrorism practices.
During the Bush Administration, new U.S.-EU agreements were concluded on police information
sharing, extradition, mutual legal assistance, container security, and airline passenger data.
Bilateral intelligence sharing and close counterterrorism cooperation were established with many
key European countries, which may have helped disrupt terrorist plots and apprehend those
involved. Nevertheless, many Europeans strongly opposed aspects of the Bush Administration’s
policies. The detention center at Guantánamo Bay, which Europeans argue degrades shared
values regarding human rights and disregards international accords on the treatment of prisoners,
has been at the center of this opposition.
Thus, European leaders welcomed President Obama’s announcement that he intends to close the
Guantánamo Bay facility within a year of taking office. Obama’s executive order banning torture
and his initiative to review Bush Administration legal opinions regarding detentions and
interrogation methods were also well received across the Atlantic. Nonetheless, serious
challenges remain to be solved regarding how Guantánamo will be shut down.10 The U.S.
Administration is asking EU countries to consider accepting a group of approximately 50
detainees who have been cleared for release, but who cannot be returned to their country of origin
for fear of subsequent torture or execution. The United States appointed a high-level envoy to
help persuade other countries to accept detainees. In previous years, a total of approximately 30
former detainees have been transferred to EU member countries—the vast majority being citizens
or residents of the country to which they returned. Some European states have expressed a
willingness to take in additional, non-national released detainees on a case-by-case basis, others
have ruled it out, and still others continue to debate the matter internally. With no common EU
position, the decision has been left up to member states to make on an individual basis. Due to the
Schengen system of passport- and visa-free travel between many European countries, EU
countries have agreed to a framework of information sharing regarding any accepted detainees.11
Although President Obama has also indicated possible closures of other overseas detention
facilities at some point, the future of U.S. policy regarding rendition, secret detention, indefinite
detention, and some types of “enhanced interrogation techniques” is not yet fully clear. The
10 See CRS Report R40139, Closing the Guantanamo Detention Center: Legal Issues, by Michael John Garcia et al.
11 The Schengen area includes 22 EU member countries plus Iceland, Liechtenstein, Norway, and Switzerland. Five EU
members—Bulgaria, Cyprus, Ireland, Romania, and the United Kingdom—are not part of Schengen.
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European Parliament, for one, has been an outspoken critic of these practices. The Obama
Administration has ceased using the term “enemy combatants” in reference to Guantánamo
detainees and has changed the legal basis for holding detainees from presidential authority to U.S.
and international law.
Beyond Guantánamo, European opposition to the U.S. death penalty could impede extradition
deals in some terrorism cases, and European concerns about U.S. data and privacy protections
have complicated U.S.-EU information sharing arrangements. U.S. officials have been concerned
that rendition-related criminal proceedings against CIA officials in some EU states may put vital
counterterrorism cooperation between U.S. and European intelligence agencies at risk.
Lastly, although some EU member states include Hezbollah on their national lists of terrorist
organizations, the EU has for years resisted adding Hezbollah to its common list, despite repeated
entreaties from Members of Congress and U.S. administrations.
Climate Change12
The prospect of a major shift in U.S. climate change policy under the Obama administration has
been welcomed by many in Europe. The debate over climate change legislation in the United
States has an important impact on negotiations for a new international framework, and there will
be a high degree of European and international interest in how the debate plays out.
Europe is often perceived as a global leader in climate change policy. In the 2007 Energy Policy
for Europe, member states agreed to the following EU-wide targets for the year 2020: a 20%
carbon emissions reduction compared with 1990 levels (increased to 30% should other developed
countries agree to match such a target); a 20% increase in energy efficiency; 20% of all energy
consumption from renewable sources; and 10% of transport fuel from biofuels.13 In December
2008, the EU approved an integrated climate and energy package that details how it plans to meet
these goals. The package, which will come into force by 2011, includes binding national targets
for each country. The agreement also covers the operation of the second phase of the EU
Emissions Trading System (ETS), which will begin in 2013.
Over the past eight years, some European officials expressed frustration with what they viewed as
the Bush Administration’s skepticism toward climate change. The Bush Administration was
reluctant to agree to binding international targets on greenhouse gas emissions and energy
efficiency, generally preferring to seek technological solutions instead of global regulation. Many
in the Bush Administration also maintained that binding caps could hurt the U.S. economy unless
they are also applied to major emitters in the developing world, most notably China and India. At
the December 2007 UN climate change conference in Bali, the EU unsuccessfully attempted to
persuade the United States to agree to emissions targets of as much as 40% below 1990 levels by
2020.
12 For more information see CRS Report RL34513, Climate Change: Current Issues and Policy Tools, by Jane A.
Leggett; CRS Report RL30024, U.S. Global Climate Change Policy: Evolving Views on Cost, Competitiveness, and
Comprehensiveness, by Larry Parker and John Blodgett; and CRS Report RL34150, Climate Change and the EU
Emissions Trading Scheme (ETS): Kyoto and Beyond, by Larry Parker.
13 See An Energy Policy for Europe, European Commission, January 10, 2007,
http://ec.europa.eu/energy/energy_policy/doc/01_energy_policy_for_europe_en.pdf
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The American Clean Energy and Security Act of 2009 (H.R. 2454), which passed the House of
Representatives in late June, aims to reduce U.S. emissions 17% by 2020, compared to 2005
levels, using a “cap and trade” system.14 Although welcoming U.S. legislative action, some
Europeans were critical that the goals of the bill are not ambitious enough (for example, some
criticized using 2005, instead of 1990, as the base year). The bill has now been placed on the
Senate legislative calendar for examination—however, given widespread concern about the
economy, many feel 2009 could be a difficult year to pass such legislation, and there are growing
expectations in Europe that the U.S. debate will extend into 2010.
The progress of the U.S. debate has considerable international ramifications: many hope that the
next international climate conference, scheduled for December 2009 in Copenhagen, will produce
a successor to the Kyoto Protocol, which expires in 2012. The U.S. role at Copenhagen, including
its ability to influence China and India on accepting binding emissions targets, will be
substantially affected by whether or not new domestic legislation has been put in place
beforehand. Should the United States adopt a “cap and trade” system, some experts have
suggested the eventual combination of such a U.S. system with the EU Emissions Trading
System, creating a transatlantic emissions trading, or carbon credit, market.
Economic Relations15
The United States and the European Union have the largest trade and investment relationship in
the world. In 2008, the value of the two-way transatlantic flow of goods, services, and income
receipts from investment totaled nearly $1.6 trillion. U.S. and European companies are also the
biggest investors in each other’s markets; total stock of two-way direct investment exceeded $2.6
trillion by the end of 2007 (latest data available). Although a number of policy disputes exist, the
economic relationship is the bedrock of transatlantic interdependence and, comprising
approximately 53% of global gross domestic product (GDP), is the most influential such
relationship in the world.
The global financial crisis and recession is expected to impact Europe harder and longer in
comparison to the United States. A coordinated international response has been discussed at G-20
meetings in November 2008 in Washington, DC, and April 2009 in London—leading economies
have agreed to the principle of avoiding protectionist trade measures, and to boost the resources
of the International Monetary Fund (IMF) to aid severely affected countries. However, at the
London G-20 Summit in April 2009, European leaders strongly resisted U.S. calls for greater
stimulus spending. Europeans argued that existing stimulus packages need more time to take
effect, and that focus should instead be directed to new financial sector regulation. The EU is
planning major reforms to the regulation and supervision of the financial sector across its member
states, including the creation of new cross-border agencies to monitor stability and risk in
financial markets.
14 Under a “cap and trade” (also known as emissions trading) system, companies are granted a certain number of credits
or allowances for carbon emissions. Companies that wish to exceed their emission cap would purchase unused credits
from other companies that have remained below their cap.
15 For more information see CRS Report RL30608, EU-U.S. Economic Ties: Framework, Scope, and Magnitude, by
William H. Cooper and CRS Report RL34381, European Union-U.S. Trade and Investment Relations: Key Issues,
coordinated by Raymond J. Ahearn.
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European officials have expressed concerns regarding protectionist provisions in U.S. stimulus
legislation, as well as in U.S. energy and climate bills. There are also concerns over the prospects
for negotiations on the second stage of the Open Skies agreement, in which Europeans would like
to see the creation of a U.S.-EU Open Aviation Area that removes restrictions on foreign
ownership of airlines and allows reciprocal access to domestic markets. European officials assert
that standards for the mutual recognition of aircraft repair stations under the FAA Reauthorization
Act of 2009 (H.R. 915) contradict the 2008 U.S.-EU Aviation Safety Agreement. In addition,
many Europeans believe that the 2007 U.S. law requiring ports to achieve 100% security
screening for U.S.-bound containers will have significantly negative economic effects. Some
Europeans have criticized the $10 per person visitor tax proposed under the Travel Promotion Act
of 2009 (H.R. 2935, S. 1023), arguing that it would discourage transatlantic travel and tourism.
U.S.-EU cooperation has been the key driving force behind efforts to liberalize world trade.
While differences with countries in the developing world have been the primary reason why the
Doha round of multilateral trade negotiations has stalled, the inability of the United States and EU
to agree to a common position on agricultural subsidies has not helped matters. Transatlantic
trade disputes also persist over poultry, subsidies to Boeing and Airbus, hormone-treated beef,
and bio-engineered food products.
Regulatory Cooperation and the Transatlantic Economic Council16
The United States and the EU have made a number of attempts to reduce remaining non-tariff and
regulatory barriers to trade and investment. At the 2007 U.S.-EU summit, German Chancellor
Angela Merkel initiated the creation of the Transatlantic Economic Council (TEC), a new
institutional structure headed on both sides by cabinet/ministerial-level appointees and tasked
with advancing the process of regulatory cooperation and barrier reduction.
Numerous studies have concluded that reducing regulatory burdens and harmonizing standards in
areas such as safety, health, environment, engineering, and labeling could provide a significant
boost to GDP on both sides of the Atlantic. Some have called for setting a target date by which to
achieve an integrated transatlantic market.17 The TEC was designed to provide increased political
weight for the acceleration of the technical process of regulatory convergence. Meeting twice
annually and reporting to the U.S.-EU Summit, the TEC was charged with building on existing
sectoral dialogues in areas such as pharmaceuticals and food, automobile, and consumer product
safety, as well as reviewing policies in priority areas such as innovation, technology, financial
markets, and intellectual property. Results thus far have been mixed: while the TEC agreed that
both sides should pursue mutual recognition of accounting standards, it was unable to solve the
poultry dispute. Although the TEC has provided a regular forum for communication on regulatory
issues, some feel that it has not lived up to its initial promise and that its role has already become
uncertain. Some Europeans believe the United States has failed to devote sufficient political
commitment to the TEC. While most observers feel the TEC is still a potentially useful
mechanism, some believe its future will depend in large part on the priority accorded to it under
the new U.S. Administration.
16 For more information see CRS Report RL34735, Transatlantic Regulatory Cooperation: A Possible Role for
Congress, by Raymond J. Ahearn and Vincent Morelli and CRS Report RL34717, Transatlantic Regulatory
Cooperation: Background and Analysis, by Raymond J. Ahearn.
17 See, for example, James Elles, The Transatlantic Market: A Reality by 2015?, Transatlantic Policy Network, 2006.
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To help accomplish its mandate, the TEC was directed to broaden stakeholder participation with
the establishment of an advisory group that includes the Transatlantic Business Dialogue
(TABD), the Transatlantic Consumers Dialogue (TACD), and the Transatlantic Legislators’
Dialogue (TLD). The TLD is the formal mechanism for engagement and exchange between the
U.S. House of Representatives and the European Parliament. Although the process of transatlantic
economic integration and regulatory cooperation has been largely an executive branch affair,
some advocates of convergence believe that greater involvement on the part of legislatures is
essential. They argue that an active and robust TLD serving as an adviser to the TEC could
significantly advance the process. However, many believe that the TLD remains relatively
obscure, with ambiguity regarding which U.S. Members actually belong, and no role given to the
U.S. Senate. A re-structuring and re-invigoration of the TLD may help it play a more influential
role in these issues.
Visa Waiver Program18
The U.S. Visa Waiver Program (VWP) has been a source of transatlantic discord in recent years.
Although the issue has not been fully resolved, developments in late 2008 helped defuse some of
the discontent on the European side.
The VWP permits travelers from participating countries to enter the United States for a maximum
of 90 days without a visa. Admission to the VWP requires meeting security and passport
standards and signing on to a number of information-sharing arrangements. While U.S. citizens
enjoy such short-term visa-free travel to all 27 countries of the EU, not all EU members are
included in the U.S. VWP. The EU has sought full reciprocity based on its fundamental principle
of equal treatment of all member states and their citizens. The issue has caused particular
frustration in a number of central and eastern European countries, who have found themselves
excluded from the VWP despite their support of the United States in Iraq and on counterterrorism.
Although the EU has attempted to negotiate the VWP as an EU-U.S. matter, the United States has
preferred to address the issue bilaterally with the individual countries involved.
In July 2007, Congress passed legislation (P.L. 110-53) simultaneously strengthening the
program’s security components and granting the Secretary of the Department of Homeland
Security (DHS) authority to waive certain admission requirements. This waiver made it easier for
some EU members (and other interested states) to qualify. In late 2008, seven of the 12 EU
countries that had been outside the VWP were admitted to the program: the Czech Republic,
Estonia, Hungary, Latvia, Lithuania, Malta, and Slovakia. Welcoming this progress (despite the
bilateral nature of the process), the European Union would still like the five member states that
remain outside the VWP—Bulgaria, Cyprus, Greece, Poland, and Romania—admitted as soon as
possible.19 Poland remains a notable outsider given the large Polish community in the United
States and the fact that it has been an ardent lobbyist for inclusion in the VWP.
Noting that terrorists with European citizenship have entered the United States on the VWP, some
Members of Congress have expressed skepticism about the VWP in general because of security
concerns. Other Members have been more supportive of extending the VWP to new EU members,
18 For more information, see CRS Report RL32221, Visa Waiver Program, by Alison Siskin.
19 “European Commission Vice-President Barrot Welcomes Significant Development in Secure, Visa-Free Travel
Across the Atlantic,” Delegation of the European Commission to the USA, October 17, 2008,
http://www.eurunion.org/eu/
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given their roles as U.S. allies, and in the belief that the requirements for entering the VWP
promote higher standards for travel and document security and increase information sharing. The
recent expansion of the VWP by DHS was criticized by Members of Congress who preferred to
freeze the program pending further improvements as called for in a September 2008 GAO
report.20 Senators Dianne Feinstein and John Kyl have introduced legislation (S. 203) in the 111th
Congress to strengthen security and oversight procedures of the VWP.
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.
20 U.S. Government Accountability Office, Visa Waiver Program: Actions Are Needed to Improve Management of the
Expansion Process, and to Assess and Mitigate Program Risks, GAO-08-967, September 15, 2008.
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