The United States and Europe: Current Issues
Derek E. Mix
Analyst in European Affairs
February 1, 2010
Congressional Research Service
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The United States and Europe: Current Issues
Summary
Common values, overlapping interests, and shared goals 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
suggested opportunities for the United States and Europe to address the common set of global
challenges they face. At the same time, observers note that an improved transatlantic political
atmosphere does not necessarily translate into tangible foreign policy results. Transatlantic
cooperation is strong on many key issues, but some divisions and tensions 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 has
shifted 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 attempted to renew 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, the global financial crisis has posed 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. Despite disappointment with the
failure of the December 2009 Copenhagen conference to 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 raised
questions and debate, and the process of sorting through the difficulties has been slow. 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. While the Obama Administration’s “re-set”
approach appears to have contributed to an improved atmosphere, 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 second session of 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 ................................................................................................................................... 7
Counterterrorism................................................................................................................... 8
Climate Change .................................................................................................................. 10
Economic Relations ............................................................................................................ 11
Regulatory Cooperation and the Transatlantic Economic Council .................................. 12
Visa Waiver Program .......................................................................................................... 13
Contacts
Author Contact Information ...................................................................................................... 14
Acknowledgments .................................................................................................................... 14
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The United States and Europe: Current Issues
The Current State of U.S.-European Relations
The Ties That Bind
Common values, overlapping interests, and shared goals are the foundation of what is often
described as the transatlantic partnership between the United States and Europe. By almost any
measure, the institutional pillars of the Euro-Atlantic community—NATO and the European
Union (EU)—have proven successful 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 economic concerns, terrorism, weapons proliferation, energy security, climate change,
environmental degradation, and the destabilizing effects of failing and rogue states. 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 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 agencies and 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 has affected the
transatlantic economic relationship and tested 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; energy security; 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 and 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
being too unilateral, too reliant on military force, and too dismissive of international treaties and
norms.
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As President Obama took office in January 2009, European expectations were high. Many looked
for a U.S. foreign policy newly committed to multilateralism, consultation, and instruments of
soft power. During Obama’s first year in office, the tone of transatlantic relations has been warm,
and close U.S.-European cooperation has continued in a wide range of issues. Polls show that
President Obama remains popular in Europe, and that European perceptions of U.S. foreign
policy have improved compared to previous years.1 At the same time, in attempting to jointly deal
with a long list of global security and economic challenges, both sides have faced a reality check
that echoes warnings about the dangers of exaggerated expectations. Some analysts continue to
caution that the United States should be reasonable about what it can expect out of Europe, and
that Europeans 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 EU now consists of 27 member countries. In a wide range of areas, including many economic
and social issues and a growing number of law enforcement and judicial matters, members’
decision- and policy-making takes place at the level of the EU institutions. As a result, the EU has
become an increasingly important interlocutor for the United States. The EU is also continuing
efforts to develop a stronger Common Foreign and Security Policy (CFSP) and Common Security
and Defense Policy (CSDP).
On December 1, 2009, the EU adopted the Lisbon Treaty, a new initiative that, in part, introduces
reforms intended to enhance the credibility and coherence of the EU’s foreign policy voice. The
treaty also seeks to streamline the EU’s institutional arrangements and decision-making
procedures. Elections for a new European Parliament were held in June 2009, and a new
European Commission is expected to take office in February 2010.
While the process of integration has slowly created an emerging European identity among
Europe’s citizens, the identities and influence of individual member states and regions will also
undoubtedly remain strong. For this reason, many observers and officials point to the value of
maintaining strong bilateral relations with the individual member states of the EU, even as the
U.S.-EU relationship takes on growing significance.
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, or 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.
1 See, for example, The German Marshall Fund of the United States, Transatlantic Trends 2009.
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Key Issues in U.S.-European Relations
Afghanistan2
President Obama has put Afghanistan at the top of his Administration’s foreign policy priorities,
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 84,150 troops from 43 countries, including all 28
members of NATO.3 More than eight 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.
On December 1, 2009, President Obama announced that 30,000 additional U.S. troops would
begin deploying to Afghanistan in early 2010, bringing the total number of U.S. military
personnel in the country to approximately 100,000. To support this new “surge” strategy, the
United States called for additional contributions from its partners. European countries have
reportedly pledged to increase their contribution by a total of about 7,000 troops. Over the past
few years, U.S. and NATO officials have repeatedly urged greater troop and equipment
contributions from some of the European allies. Many European countries have long 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.
Some Europeans are concerned that greater “Americanization” of the mission could come at the
expense of Allied input and consultation in strategic decision making.
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 have borne the vast
majority of combat in the country’s most volatile regions.
The spring 2009 U.S. strategic review of policy for Afghanistan and Pakistan 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
2 For more information see CRS Report RL33627, NATO in Afghanistan: A Test of the Transatlantic Alliance, by
Vincent Morelli and Paul Belkin, CRS Report RL30588, Afghanistan: Post-Taliban Governance, Security, and U.S.
Policy, by Kenneth Katzman, and CRS Report R40156, War in Afghanistan: Strategy, Military Operations, and Issues
for Congress, by Steve Bowman and Catherine Dale.
3 As of December 22, 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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conclusions. Some experts have long suggested that Europe has much to offer in these terms,
calling for a greater contribution of civilian expertise, especially in areas such as police training.
The strategic review also confirmed a growing consensus 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 strongly 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.
At the international conference on Afghanistan that took place in London on January 28, 2010,
leaders and officials from about 70 countries met to discuss next steps. Participants agreed to set a
timetable for transferring increased security responsibility to Afghan forces in late 2010 or early
2011, and pledged to establish a reconciliation fund intended to help reintegrate into Afghan
society members of the Taliban who lay down their arms. In his December 1, 2009, speech,
President Obama set July 2011 as the target date at which conditions should allow U.S. forces to
start drawing down.
Iran4
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 assert
that Iranian does not fully comply 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) 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
4 For more information see CRS Report RL32048, Iran: U.S. Concerns and Policy Responses, by Kenneth Katzman,
CRS Report RS20871, Iran Sanctions, by Kenneth Katzman, CRS Report RL34544, Iran’s Nuclear Program: Status,
by Paul K. Kerr, and CRS Report R40094, Iran’s Nuclear Program: Tehran’s Compliance with International
Obligations, by Paul K. Kerr.
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the United States have successfully pushed for United Nations Security Council approval of
limited sanctions on Iran (Resolutions 1737, 1747, and 1803).
Early in its term, the Obama Administration indicated a willingness to increase direct U.S.
engagement in talks with Iran. European leaders welcomed and encouraged this prospect,
although emphasizing that it should be closely coordinated within the P5+1 framework. The
aftermath of the controversial and disputed re-election of Iranian President Mahmoud
Ahmadinejad in June 2009, however, has complicated matters. 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 officials and observers have been wary of how international overtures might
impact perceptions of Ahmadinejad’s legitimacy and some question whether, under the
circumstances, the Iranian government is in a position to act as a serious negotiating partner. At
the same time, the Iranian government blamed post-election unrest on Western interference,
particularly singling out the United States and the UK, leading to a debate in the United States
and Europe over how best to engage the Iranian opposition. Furthermore, an announcement by
the United States, UK, and France in September 2009 revealing the existence of a previously
undisclosed nuclear facility near the city of Qom added tension to the atmosphere.
During talks in fall 2009, the United States, France, and Russia advanced a proposal to enrich
Iranian uranium outside the country for use in an Iranian research reactor. Given the continuing
lack of an official Iranian response to this proposal, and Tehran’s failure since November 20,
2009, to agree to a subsequent meeting, the United States and the EU are likely to pursue further
U.N. sanctions in 2010. British Prime Minister Brown, French President Sarkozy, and German
Chancellor Merkel all appear to support the adoption of tougher sanctions. However, the United
States and the EU continue to face a challenge in securing cooperation from Russia and China.
Although the United States has strongly supported EU-3 efforts in this issue, some Americans
have pointed to European economic ties with Iran and urged Europeans to adopt 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. The EU has long opposed the U.S. Iran Sanctions Act as an
extraterritorial application of U.S. law. Some Europeans have also been concerned that 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 U.S. sanctions on
Iran, including penalizing gasoline sales to Iran, include H.R. 2194 (which passed the House on
December 15, 2009) and S. 2799 (which was adopted by the Senate on January 28, 2010).
Israeli-Palestinian Conflict5
Israel’s offensive into Gaza in December 2008-January 2009, coupled with leadership changes in
the United States and Israel in early 2009, brought renewed international attention to the Israeli-
Palestinian conflict. While the United States and the EU advocate the negotiation of a political
settlement, however, many experts observe that circumstances do not easily lend themselves to a
revived peace process.
5 For more information see CRS Report RL33530, Israeli-Arab Negotiations: Background, Conflicts, and U.S. Policy,
by Carol Migdalovitz and CRS Report R40092, Israel and the Palestinians: Prospects for a Two-State Solution, by Jim
Zanotti.
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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 U.N.) 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 early appointment of a special Middle East envoy and its increased engagement
with Syria, a significant regional influence, were 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 some perceptions of a more
balanced U.S. approach among those who believe U.S. policy has historically favored Israel.
Arguably the greatest obstacle to the peace process is the split in Palestinian leadership. Hamas
forcibly took over Gaza in June 2007, leading to the dismissal by Palestinian Authority (PA)
President Mahmoud Abbas (from Hamas’ rival Fatah) of a Hamas-led PA unity government. The
United States and the EU classify Hamas as a terrorist organization and have no direct relations
with its leaders.6 The United States and the EU maintain political ties with the Palestinians
through Abbas and the “caretaker” PA administration he has appointed to govern the West Bank.
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 indicated
willingness to pursue the peace process under certain conditions, many observers have been
skeptical about his government’s intentions regarding a “two-state” solution. Israel’s resistance to
U.S. and European pressure to halt settlements has been the source of considerable tension, as has
continuing European criticism of Israel’s actions during the Gaza offensive. Perceived differences
in approach to the peace process led the EU to freeze a planned upgrade in relations with Israel in
April 2009.
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. Recent statements by Hamas leaders
suggest that, rhetorically at least, the group might be willing to move toward a middle ground—
for example, recognizing the 1967 borders but not the state of Israel. Some analysts believe any
such shift in Hamas’ public stance might simply be calculated to win greater European support—
and that such language might well be interpreted in Europe as a willingness to participate in the
political process. A resultant shift in European policy toward greater engagement could reflect
transatlantic divergence: U.S. policy maintains that Hamas must renounce violence and recognize
Israel, whereas Europeans might be more flexible about the terms under which Hamas could be
6 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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included in the political process. Both Israeli and Fatah officials have expressed their opposition
to the prospect of any expanded European political engagement with Hamas.
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 $960 million for
Palestinian economic and security assistance in FY2009 and appropriated about $500 million for
FY2010. 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).
Russia7
In the aftermath of its August 2008 conflict with Georgia, relations between Russia and the West
reached what some observers consider their lowest point since the end of the Cold War. In fact,
relations had already grown increasingly tense in recent years, with numerous issues serving as
points of irritation and contention. Many European countries have 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.
For some time, against a background of tensions over Russian opposition to both past and
prospective NATO enlargement, as well as to Western support for the independence of Kosovo,
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. The Obama
Administration’s attempted “re-set” of relations appears to have alleviated some of the tension
that had built up. In April 2009, following an initial meeting between President Obama and
President Medvedev, leaders at NATO’s 60th Anniversary Summit decided to resume the meetings
of the NATO-Russia Council, which had been suspended due to the Georgia conflict. President
Obama traveled to Moscow for a summit in July 2009, and the two sides 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; and
agreed to increase military-to-military contact and cooperation, including cooperation on nuclear
security issues. The Administration’s September 2009 decision to alter U.S. plans for missile
defense installations in Poland and the Czech Republic appears to have diminished a primary
source of past friction. Negotiations between the United States and Russia are ongoing about a
successor agreement to the Strategic Arms Reduction Treaty (START), and the two sides have
also been discussing cooperation regarding missile defense, Iran, and North Korea.
At the same time, considerable U.S. and European 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. U.S. and EU
leaders face difficulties in securing Russian cooperation on the matter of possible new sanctions
7 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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on Iran’s nuclear program. 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 is divided between those who believe in a firm, vigilant 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 officials
and observers in the countries of central and eastern Europe and the former Soviet Union have
been 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 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, arms control, and energy.
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.8 Thus, upstream gas
cutoffs—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.
Counterterrorism
In the years since September 11, 2001, U.S. counterterrorism cooperation with the EU and
individual European countries has been strong. 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.
8 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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Nevertheless, many Europeans strongly opposed aspects of the Bush Administration’s policies.
The detention center at Guantánamo Bay, which Europeans have long argued degrades shared
values regarding human rights and disregards international accords on the treatment of prisoners,
has often stood at the center of European objections. The European Parliament, for one, was an
outspoken critic of U.S. policy regarding rendition, secret detention, indefinite detention, and
some types of “enhanced interrogation techniques.”
Policy changes introduced by the Obama Administration over the past year seem to have
diminished some European concerns and objections over U.S. counterterrorism and detention
practices. European leaders welcomed President Obama’s early announcement that he intended 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.
The Administration has faced serious challenges, however, regarding how to shut down
Guantánamo, and the process of sorting through the difficulties has been slow.9 The initial one
year deadline has passed, and closing the facility is now expected to take several years. In March
2009, the U.S. State Department appointed a special envoy tasked with persuading countries in
Europe and elsewhere to take in detainees who will not be charged and have been cleared for
release, but who cannot be repatriated to their country of origin for fear of torture or execution.
Prior to 2009, a total of approximately 30 former detainees were transferred to EU countries—
most being citizens or residents of the country to which they returned. Following early Obama
Administration requests for help in accepting released detainees from third countries, the EU was
unable to agree on a common position, and the decision was 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, however, EU countries agreed to a framework of information sharing
regarding any accepted detainees.10
EU member countries Belgium, France, Hungary, Ireland, Italy, Portugal, Slovakia, Spain, and
the United Kingdom have accepted or publically agreed to accept from one to three released
detainees each, with the individuals in question negotiated on a case-by-case basis. Austria, the
Czech Republic, Denmark, Netherlands, and Poland have publically indicated that they do not
intend to accept released detainees. Other EU countries are reportedly continuing private talks
with the U.S. Administration or are still considering the matter internally.
Following the attempted bombing of a Northwest Airlines flight from Amsterdam to Detroit on
December 25, 2009, airport security has taken on renewed urgency as a focus for transatlantic
cooperation. The U.S. Secretary of Homeland Security met with EU interior ministers in late
January 2010 to discuss ways to enhance data sharing, passenger screening, and on-board security
for transatlantic flights. EU countries are debating whether to expand the use of “full body scan”
machines at European airports.
Although overall counterterrorism cooperation is strong, a few areas of tension remain. 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
9 See CRS Report R40139, Closing the Guantanamo Detention Center: Legal Issues, by Michael John Garcia et al.
10 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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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 Change11
Despite disappointment with the outcome of the December 2009 international conference that
was held in Copenhagen, climate change remains a top European priority. Many Europeans had
hoped that the Copenhagen meeting would produce a successor treaty to the Kyoto Protocol,
including binding targets for the reduction of greenhouse gas emissions by all major economies.
The debate over climate change legislation in the United States has an important impact on
prospects for a future international framework, and there will continue to 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; a 20% increase in energy efficiency; 20%
of all energy consumption from renewable sources; and 10% of transport fuel from biofuels.12 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. Additionally, the EU
maintains a commitment to increase its emissions reduction target to 30% if other major
international emitters agree to a comparable goal.
The perceived shift in the U.S. climate change debate under the Obama Administration has been
welcomed by many in Europe. In past 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.
The American Clean Energy and Security Act of 2009 (H.R. 2454), which passed the House of
Representatives in June 2009, aims to reduce U.S. emissions 17% by 2020, compared to 2005
levels, using a “cap and trade” system.13 Although welcoming U.S. legislative action, some
11 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.
12 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
13 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.
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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). With the bill now on the Senate
legislative calendar, its future is uncertain—given widespread concern about the economy and
questions about the potential economic impact of such measures, many feel that this could be a
difficult time to pass such legislation. Should the United States eventually 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 Relations14
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 (latest data available). U.S. and European
companies are also the biggest investors in each other’s markets; total stock of two-way direct
investment came to about $3 trillion in 2008. Although a number of policy disputes exist, the
economic relationship is the bedrock of transatlantic interdependence. Together comprising 54%
of global gross domestic product (GDP), the U.S.-EU economic relationship is also the world’s
most influential in terms of shaping standards and regulations.
The global financial crisis and recession has affected the economic relationship and tested the
political relationship. Although economic recovery now appears to be underway in much of the
EU, a number of member states have been severely impacted by the crisis. A coordinated
international response was discussed at G-20 meetings in November 2008 in Washington, DC,
April 2009 in London, and September 2009 in Pittsburgh. Leading economies agreed to avoid
protectionist trade measures, and to boost the resources of the International Monetary Fund
(IMF). However, at the London meeting European leaders resisted U.S. calls for greater stimulus
spending. Europeans argued that existing stimulus packages needed more time to take effect,
preferring instead to focus on new regulation for the financial sector. 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.15
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 some 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.
14 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.
15 See CRS Report R40415, The Financial Crisis: Impact on and Response by The European Union, by James K.
Jackson.
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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. 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. The TEC
met most recently on October 27, 2009, in Washington, DC, where it discussed joint responses to
the financial crisis, agreed to identify key sectors on which to focus renewed efforts for regulatory
convergence, and launched a new dialogue on innovation and technology.
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.
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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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,
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.
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/
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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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.
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