The United Kingdom: Background and
Relations with the United States
Derek E. Mix
Analyst in European Affairs
April 29, 2015
Congressional Research Service
7-5700
www.crs.gov
RL33105
The United Kingdom: Background and Relations with the United States
Summary
Many U.S. officials and Members of Congress view the United Kingdom (UK) as the United
States’ closest and most reliable ally. This perception stems from a combination of factors,
including a sense of shared history, values, and culture, as well as extensive and long-established
cooperation on a wide range of foreign policy and security issues. In the minds of many
Americans, the UK’s strong role in Iraq and Afghanistan during the past decade reinforced an
impression of closeness and solidarity.
Upcoming 2015 Elections
The next UK general election is scheduled to take place on May 7, 2015. Many analysts expect
the result to be a second consecutive hung Parliament, with no absolute majority for any party.
The 2010 election resulted in the country’s first coalition government since the Second World
War. The Conservative Party won the most votes in the election, and Conservative leader David
Cameron became prime minister. To command a parliamentary majority, the Conservatives were
compelled to partner with the Liberal Democrats, who came in third place, and Liberal Democrat
leader Nick Clegg became deputy prime minister. The Labour Party, led by Ed Miliband, moved
into opposition after leading the UK government since 1997.
Economic and fiscal issues have been the central domestic challenge facing the coalition. Seeking
to reduce the country’s budget deficit and national debt, the coalition adopted a far-reaching
austerity program early in its tenure. Fears of a double-dip recession in 2012 put the government
and its austerity strategy under considerable pressure and criticism, but economic growth has
improved significantly since 2013. Nevertheless, austerity has continued to heighten social
tensions and cause political friction between the coalition partners.
The Conservatives have also felt pressure from growing popular support for the UK
Independence Party (UKIP). Polls indicate that the issue of immigration, on which UKIP has
been very outspoken, is the top priority of British voters. Additionally, although Scottish voters
rejected independence in a September 2014 referendum, the Scottish National Party (SNP) is
expected to make considerable gains in the general election.
EU Membership
The topic of Europe has been a source of tension in the UK. The UK has long been one of the
most skeptical and ambivalent members of the 28-country European Union (EU). While the
Conservative Party remains a stronghold of “euro-skeptics,” and UKIP advocates withdrawal
from the EU, the Labour Party is generally supportive of the EU, and the Liberal Democrats and
SNP are strongly pro-EU. The Eurozone crisis deepened the currents of British antipathy toward
the EU, fueling calls to reclaim national sovereignty over issues where decision-making has been
pooled and integrated in Brussels. Some analysts believe that a British departure from the EU is a
growing possibility. If reelected, Prime Minister Cameron intends to renegotiate the UK’s
relationship with the EU and put its membership to a national referendum in 2017.
U.S.-UK Relationship
In recent years, some observers have suggested that the U.S.-UK relationship is losing relevance
due to changing U.S. foreign policy priorities and shifting global dynamics. U.S. officials have
expressed increasing concerns about UK defense cuts and their potential effect on future security
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The United Kingdom: Background and Relations with the United States
cooperation. Despite such anxieties, most analysts believe that the two countries will remain close
allies that choose to cooperate in many important areas, such as counterterrorism, economic
issues, and the future of NATO, as well as numerous global and regional security challenges.
Given its role as a close U.S. ally and partner, developments in the UK and its relations with the
United States are of continuing interest to the U.S. Congress. This report provides an overview
and assessment of some of the main dimensions of these topics. For a broader analysis of
transatlantic relations, see CRS Report RS22163, The United States and Europe: Current Issues,
by Derek E. Mix.
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The United Kingdom: Background and Relations with the United States
Contents
Introduction ...................................................................................................................................... 1
The UK’s Coalition Government ..................................................................................................... 1
Austerity and the UK Economy ....................................................................................................... 2
The 2015 Election ............................................................................................................................ 4
The UK and the European Union .................................................................................................... 6
U.S.-UK Relations ........................................................................................................................... 8
Political Relations ...................................................................................................................... 8
Defense Relations ...................................................................................................................... 9
Austerity and the Defense Budget ..................................................................................... 11
Intelligence and Counterterrorism Cooperation ...................................................................... 12
Economic Relations ................................................................................................................. 14
Conclusion ..................................................................................................................................... 15
Tables
Table 1. May 2010 UK General Election Results ............................................................................ 2
Table 2. What Are the Most Important Issues Facing the UK? ....................................................... 5
Contacts
Author Contact Information........................................................................................................... 16
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The United Kingdom: Background and Relations with the United States
Introduction
The modern U.S.-UK relationship was forged during the Second World War. It was cemented
during the Cold War, as both countries worked together bilaterally and within the North Atlantic
Treaty Organization (NATO) to counter the threat of the Soviet Union. The United States and the
UK are two of the five permanent members of the United Nations Security Council, and both are
founding members of NATO. In the early 1990s, the UK was an important U.S. ally in the first
Gulf War, and the two countries later worked together in stabilization and peacekeeping
operations in the Balkans. The UK was the leading U.S. ally in the 2003 invasion of Iraq and
subsequent stabilization operations and the largest non-U.S. contributor to the NATO-led mission
in Afghanistan. The UK remains an important U.S. partner in ongoing global security challenges,
such as combatting international terrorism and countering the Islamic State terrorist group;
ensuring that Iran’s nuclear program can be used solely for peaceful purposes; and opposing
Russia’s annexation of Crimea and actions destabilizing Ukraine, including by supporting strong
sanctions in response to these actions. The UK is also the sixth-largest economy in the world and
a major financial center. The United States and the UK share an extensive and mutually beneficial
trade and economic relationship, and each is the other’s largest foreign investor.
U.S. and UK officials, from the cabinet level down, consult frequently and extensively on many
global issues. American and British diplomats report often turning to each other first when
seeking to build support for their respective positions in multilateral institutions or during times
of crisis, as in the immediate aftermath of the 9/11 attacks on the United States. British input is
often cited as an element in shaping U.S. foreign policy debates. Some observers assert that a
common language and cultural similarities, as well as the habits of cooperation that have
developed over the years, contribute to the ease with which U.S. and UK policymakers interact
with each other. The term “special relationship” has often been used to describe the high degree
of mutual trust between the two countries in cooperating on diplomatic and political issues. The
special relationship also encompasses close intelligence-sharing arrangements and unique
cooperation in nuclear and defense matters.
The UK’s Coalition Government
The UK general election of May 6, 2010, resulted in a hung Parliament, an outcome in which no
single party wins a majority of seats in the House of Commons. The Conservative Party, led by
David Cameron, won the most seats but fell 19 short of the 326 needed to form a majority
government on its own. The Labour Party suffered substantial losses in the election and finished
in second place. Labour had won the three previous elections and had led the UK government
since 1997, first under Tony Blair (1997-2007) and then under Gordon Brown.
Shortly after the election, the Conservatives reached an agreement on forming a coalition
government with the Liberal Democrats, led by Nick Clegg, who finished third in the voting.
With this deal reached, Gordon Brown resigned as prime minister and David Cameron became
the new prime minister of the United Kingdom. Cameron appointed five Liberal Democrats to
serve in his cabinet, including Nick Clegg as deputy prime minister. Ed Miliband, who served as
energy and climate change secretary in the Brown government, was chosen to replace Brown as
the new leader of the Labour Party, making him also leader of the parliamentary opposition.
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Table 1. May 2010 UK General Election Results
Party
# of Seats
Net # of Seats +/–
% of Vote
Conservatives 307 +97 36.1%
Labour 258
-91
29.0%
Liberal Democrats
57
-5
23.0%
Al Others
28
-1
11.9%
Source: “Election 2010,” BBC News, http://news.bbc.co.uk/2/shared/election2010/results/. Also see
http://www.parliament.uk/mps-lords-and-offices/mps/current-state-of-the-parties/.
Before the 13-year run of Labour government from 1997 to 2010, the Conservatives had led the
UK government for a stretch of 18 years, first under Margaret Thatcher (1979-1990), followed by
John Major (1990-1997). The Conservatives, who are often also called the Tories, are considered
to be a party of the center-right. While critics charge that the Conservative Party remains
dominated by the interests of the country’s social and economic elites, David Cameron, who
became the party leader in 2005 and prime minister at the age of 43, has sought to portray the
party as more modern and inclusive.
The Liberal Democrats were formed by the 1988 merger of the Liberal Party and the Social
Democratic Party. The Liberal Democrats are considered a centrist party, and members often
describe themselves as progressive and as social and economic liberals. Since their formation, the
Liberal Democrats have been the UK’s “third party,” struggling to assert their voice alongside
Labour and the Conservatives. Nick Clegg, who became the party leader in 2007 and deputy
prime minister at the age of 43, campaigned on the themes of fairness and social equality,
portraying the Liberal Democrats as the alternative to both of the larger parties.
Given ideological differences between the Conservatives and the Liberal Democrats, analysts
asserted that the two parties were an unlikely pairing for the UK’s first coalition government
since World War II. Adding up the numbers, however, this was the only combination positioned to
deliver a solid parliamentary majority after the 2010 election. The two parties swiftly reached an
initial policy agreement, but the Conservative-Liberal coalition has developed a number of
significant strains over the past four years. The coalition partners have been at odds over a range
of issues, including proposed changes to the country’s voting system, boundary reform
(redistricting), reform of the House of Lords, elements of economic austerity programs, and
relations with the European Union (EU).
Austerity and the UK Economy
The economy has been the most pressing issue facing the coalition. Between 1993 and 2008, the
British economy enjoyed an unprecedented period of sustained growth, but the country was
severely impacted by the global financial crisis and entered a deep recession in 2008. After a
prolonged slump from 2008 to 2012, the UK has been growing at a stronger pace. Economic
growth for 2014 is estimated to have been 2.6%, and forecasts for 2015 expect growth to be
2.7%.1 This improved performance takes place in the context of a wider recovery in the global
economy, especially the United States, as well as stabilized conditions in the Eurozone. Although
1 Economic statistics are from Economist Intelligence Unit, Country Report: United Kingdom, March 2015.
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longer-term forecasts expect the UK’s economic growth to average 2.4% per year between 2015
and 2019, concerns remain about the sustainability of the country’s economic recovery.
During the years of economic expansion, the UK developed a large structural budget deficit as
spending outpaced tax revenues and growth. The financial crisis and recession greatly
exacerbated this situation: the government budget deficit grew from 5% of gross domestic
product (GDP) in 2008 to nearly 11% in 2009. Public sector debt has increased from
approximately 52% of GDP in 2008 to more than 90%.
In response to these trends, the coalition government began a five-year program of budget
austerity with the original goal of reducing the deficit to below 1.5% of GDP by 2015. The plan
has entailed large spending cuts in areas such as governmental department expenditures and a
range of social welfare benefits. It also increased the value added tax (VAT), capital gains tax, and
national insurance contributions. Despite missing its initial targets, the austerity strategy has
gradually reduced the budget deficit, to an expected 4% of GDP for 2015, and analysts suggest
the deficit could decrease to 2% of GDP by 2019.
The austerity effort remains the signature initiative of the coalition government. Supporters have
praised the government’s approach as necessary in order to put the UK back on the path of
financial sustainability. Opponents have argued that the government’s approach is ideologically
driven, unduly targets the poor and the disabled, and affects society in ways that are unequal and
unfair. Critics have also charged that the austerity measures are too aggressive, hurt the
economy’s growth prospects, and erode public services. The country’s weak economic
performance in 2011-2012 and fears of a double-dip recession fueled such charges that austerity
was backfiring. The economy’s improved growth starting in 2013 therefore came as a political
boost to Prime Minister Cameron. Additionally, unemployment in the UK had decreased to 5.7%
at the start of 2015, down from 8% when the coalition took office.
In the approach to the 2015 general election, analysts note that the government has made an
exception to the overarching theme of austerity with measures to stimulate the property market,
an important component of the UK economy.2 In addition, the Bank of England has held interest
rates at a historically low level after dropping its rate from 5% in late 2008 to 0.5% in 2009. Over
the course of the crisis and the UK’s subsequent economic struggles, the Bank of England has
also employed a £375 billion (approximately $553 billion) “quantitative easing” program of
purchasing financial assets from commercial banks. The program is intended to stimulate the
economy by raising asset prices, stabilizing market sentiment, and holding down borrowing costs.
Many analysts credit a large measure of the UK’s stronger economic growth to improved external
conditions and higher consumer spending in the context of low oil prices. Despite the positive
trend in the growth outlook, analysts point to a number of ongoing, long-term weaknesses in the
UK economy, including high private sector debt, low capital spending, and lagging investment in
infrastructure and job skills. In the belief that the UK economy has grown overly dependent on
government spending and debt-financed consumption, one of the central economic aims of the
Cameron government has been to rebalance the economy toward exports, manufacturing, and
private sector investment. Analysts assert that this type of restructuring has not yet come about
and does not appear imminent.
2 See https://www.gov.uk/government/policies/making-it-easier-to-set-up-and-grow-a-business—6/supporting-pages/
getting-banks-lending.
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The 2015 Election
The next UK general election is scheduled to take place May 7, 2015. Many analysts believe that
the 2015 election is likely to result in a second consecutive hung Parliament, with no absolute
majority of seats for any party. One major poll conducted April 27, 2015, shows the Conservative
Party with 35% support and the opposition Labour Party with 34%. The UK Independence Party
(UKIP) had 12%; the Liberal Democrats, 9%; and the Green Party, 5%.3
Given the nature of the UK’s first-past-the-post electoral system, nationwide vote percentage does
not translate into a proportional number of seats in Parliament (see Table 1, for example).4 With
some exceptions, the system has historically worked to bring about single-party governing
majorities, essentially prioritizing the merits of stability over proportional representation. While
the increased fragmentation seen in the 2010 election is expected to feature heavily again in 2015,
the system continues to favor the large parties overall.
Speculation about the outcome of the 2015 election revolves around a number of observations:
• Various projections suggest that the Conservative Party and the Labour Party will
each win between 260 and 300 seats, well short of a parliamentary majority. In
this case, both parties would begin exploring potential coalition or partnership
arrangements with the smaller parties. Such talks could last several weeks.
• The party that wins the most seats does not necessarily have the right to form the
government. Constitutionally, the leader able to “command the confidence of the
House of Commons” becomes prime minister.
• The Queen’s Speech opening the new parliamentary session with the
government’s proposed program serves as an immediate vote of confidence. The
crucial threshold for approval of the speech, which is scheduled for May 27, is
323 votes.
• The incumbent prime minister remains in office until it is clear who commands
the confidence of Parliament. If neither side concedes defeat, the incumbent
would therefore be entitled to present his Queen’s Speech first.
• A minority government could take office under a “confidence and supply”
agreement with smaller parties. In return for the government adopting elements
of their program, smaller parties would agree to back the government or abstain
on votes of no confidence and the budget while reserving the right to vote against
it on other items.
Trends related to the smaller parties may also play a key role in the outcome:
• The Liberal Democrats are expected to suffer a considerable drop in support,
potentially losing over 30 of the 57 seats won by the party in 2010.
3 YouGov/The Sun poll, April 27, 2015; the latest polls are available at http://yougov.co.uk/news/categories/politics/.
4 Also see http://www.electoralcalculus.co.uk/homepage.html. Projections of parliamentary seats effectively require
district-by-district analysis of the UK’s 650 parliamentary constituencies; see http://www.electoralcalculus.co.uk/
dynamicmap.html.
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• The Scottish National Party (SNP) is expected to make large gains. The SNP has
long advocated for Scotland to leave the UK and become an independent country
and led the “Yes” campaign that was defeated in the September 2014 referendum
on independence by a vote of 55% to 45%. An SNP surge in Scotland could see
the party win at least 45 seats. The SNP holds six seats in the current parliament.
The SNP’s expected gains in Scotland would come at the expense of the Labour
Party.
• In March 2015, Labour Party leader Ed Miliband ruled out the possibility of a
formal coalition with the SNP, although the possibility of a “looser” partnership
appears to remain open. As an additional consideration, Labour and the SNP are
expected to be the two main contenders in May 2016 elections for the regional
Scottish Parliament.
• The UK Independence Party (UKIP), a party opposed to immigration and to
British membership in the EU, has had a notable rise in the polls over the past
two years. UKIP has pressured Prime Minister Cameron on immigration and
Europe, drawing away disaffected right-wing Conservative voters and
capitalizing on anti-establishment sentiments among a growing number of voters.
UKIP gained momentum in late 2014 when two Members of Parliament defected
from the Conservatives and subsequently won parliamentary by-elections under
the UKIP banner. UKIP also came in first place in the UK’s May 2014 elections
for the European Parliament, winning nearly 27% of the vote.
• Although UKIP is projected to win the third-highest percentage of the nationwide
vote, projections estimate that it might win only one or two parliamentary seats.
Any UKIP gains would come at the expense of the Conservative Party. In any
case, UKIP’s priorities have been central themes of the election season: one
major poll of British voters found immigration to be the top issue facing the
country (see Table 2 below). The issues of immigration and Europe are linked in
the form of concerns about migration to the UK from less affluent EU countries
in Eastern Europe.
Table 2. What Are the Most Important Issues Facing the UK?
YouGov voter survey results, March 2-3, 2015
Issue %
Immigration 50
Economy 46
Health 42
Welfare 30
Housing 22
Europe 17
Education 16
Tax 13
Source: https://d25d2506sfb94s.cloudfront.net/cumulus_uploads/document/na190nomoq/YG-Archives-Pol-
Trackers-Issues%282%29-Most-important-issues-030315.pdf
Notes: Respondents were asked to pick up to three issues.
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The UK and the European Union
The 2015 election could have important consequences for the future of the UK’s membership in
the European Union. In 2013, Prime Minister Cameron outlined his intention to negotiate a “new
settlement” with the EU and, if reelected as prime minister in 2015, to put the terms of a
renegotiated relationship to the British public in an “in-or-out” referendum by the end of 2017.5
UKIP and the “euro-skeptic” wing of the Conservative Party would like to move the referendum
up to the earliest possible date. The Labour Party, the Liberal Democrats, and the SNP oppose
holding such a referendum.
Should Cameron be reelected, the referendum campaign and the possibility of a “Brexit” are
likely to become central preoccupations of British and EU politics.6 The outcome of a British
referendum on EU membership would be difficult to predict. Polls have been shifting toward
support for remaining in the EU: an April 2015 poll indicated 40% would vote to stay in the EU
and 39% to leave, with a significant group of undecided voters.7
Both at home and abroad, many aspects of UK policies are set in the context of the country’s EU
membership. The other 27 member countries of the EU are among the UK’s closest political and
economic partners, and over half of British trade is conducted with its fellow EU members.
Partners such as NATO and the United States play an important role in the UK’s diplomatic and
security affairs, but many elements of British foreign policy also have an EU dimension.
Nevertheless, historically many British leaders and citizens (perhaps most notably including
former Prime Minister Margaret Thatcher) have been skeptical about the EU, and the relationship
between London and Brussels has often been marked by ambivalence. Fearing a loss of national
sovereignty and influence, the UK stood aside in the 1950s when the six founding countries
(Belgium, France, Italy, Luxembourg, Netherlands, and West Germany) launched the first steps of
European integration. The UK finally joined the precursor of the modern-day EU in 1973, largely
in order to derive the economic benefits of membership but also to have a political voice on the
inside as integration took shape.
British observers frequently express frustration that the EU tends to focus far too much on
internal treaties and process, rather than taking a pragmatic approach to priorities such as
boosting economic competitiveness, promoting a common energy policy, or improving European
defense capabilities. Many British euro-skeptics assert that EU bureaucracy and regulations stifle
the UK’s economic dynamism and that the UK’s contributions to the EU budget are too
expensive. They also argue that the EU lacks democratic legitimacy and accountability because
many of its decisions are made behind closed doors by non-British and/or unelected officials.
The UK has “opted out” of several major elements of European integration. Most significantly,
the UK retains the pound sterling as its national currency and is therefore outside the group of 19
EU member countries that use the euro as their common currency (i.e., the Eurozone). The UK
5 “David Cameron’s EU Speech in Full,” The Daily Telegraph, January 23, 2013, http://www.telegraph.co.uk/news/
worldnews/europe/eu/9820230/David-Camerons-EU-speech-in-full.html.
6 For additional information, see Mark Leonard, The British Problem and What It Means for Europe, European Council
on Foreign Relations, March 2015.
7 http://www.populus.co.uk/wp-content/uploads/OmFT-Poll.pdf.
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also does not participate in the Schengen Agreement that establishes a passport-free zone among
most EU countries.
The Eurozone crisis that began in Greece in 2009 both highlighted preexisting tensions in the
UK-EU relationship and created new ones. British leaders have stressed that a stable and
successful Eurozone is greatly in the UK’s interest, but the Cameron government pointedly
declined to participate in numerous elements of the EU’s crisis response efforts, such as
contributing to the EU sovereign “rescue funds,” and has zealously safeguarded the UK’s
financial sector from attempts to extend EU regulation. The UK declined to participate in a new
“fiscal compact” treaty, which calls for greater central surveillance over national budgets and the
adoption of a balanced budget requirement in national constitutions. The UK was also a leading
voice of opposition against proposals to increase the EU budget.
At the same time, the UK has been anxious to maintain a seat at the table and to protect its
interests in the functioning of the EU single market (comprised of all 28 EU members). British
leaders have supported tighter integration within the Eurozone on fiscal and banking issues as a
necessary solution to the crisis but have been concerned about the prospect of being sidelined by
new intergovernmental institutions in which decisions taken among the 19 Eurozone countries
affect the interests of all 28 EU members.
The Cameron government has acted on pressures to reclaim some aspects of national sovereignty
from Brussels, starting with the area of “justice and home affairs” (EU police and judicial
cooperation). The UK has also irritated some of its EU partners by essentially vetoing initiatives
to develop a stronger EU Common Security and Defense Policy (CSDP). In 2011, the UK
blocked a proposal to consolidate the command structure for EU military missions under a single
permanent operational headquarters.
The Cameron government has been conducting a comprehensive review of the UK’s relationship
with the EU. The reports published thus far have concluded that membership in the EU is, on
balance, beneficial to the UK.8 A 2013 review of membership in the “single market” found that it
made the UK an attractive destination for foreign investment and that access to the European
market gave British firms more opportunity to grow. Additionally, numerous observers have
pointed out that a British departure from the EU would mean the UK losing out on the benefits of
the prospective Transatlantic Trade and Investment Partnership (TTIP) under negotiation between
the EU and the United States.
According to British euro-skeptics, the Eurozone crisis illustrates that the continent can only drag
the UK down. Such observers argue that the UK would be better off freed from the EU’s rules
and regulations and consequently better able to focus on forging expanded ties to growing and
dynamic emerging economies elsewhere. In contrast, advocates of remaining in the EU maintain
that membership is essential for the UK’s economic fortunes and influence. In addition to the fact
that half of the UK’s exports go to the EU “single market,” business leaders have asserted, for
example, that membership in the EU serves as a “launchpad” for the UK’s global trade.9
While Cameron has not made his proposed vision of a renegotiated relationship with the EU
entirely clear, many observers have doubts about the willingness of EU countries to agree to
8 Benjamin Fox, “New UK Reports Back EU Powers, Enrage Eurosceptics,” euobserver.com, February 13, 2014.
9 “CBI Chief Warns UK Against EU Exit Vote,” The Daily Telegraph, November 19, 2012.
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significant new concessions for the UK. Analysts observe that Cameron’s potential leverage to
negotiate a “new” relationship was to some extent based on the assumption that the EU treaties
would be amended in order to formally incorporate changes to institutional architecture arising
from the Eurozone crisis. Major changes to the EU treaties require the assent of all member
states, effectively giving the UK veto leverage. This process now appears less likely to occur,
given a general reluctance in the EU to open up another institutional treaty process. Some
officials and experts maintain that the necessary changes can be made in ways that do not require
national approval from each member state.
U.S.-UK Relations
Political Relations
The UK’s “special relationship” with the United States has been a cornerstone of British foreign
policy, to varying degrees and with some ups and downs, since the 1940s. The UK is often
perceived to be the leading allied voice in shaping U.S. foreign policy debates, and observers
assert that the UK’s status as a close ally of the United States has often served to enhance its
global influence. British support, in turn, has often helped add international credibility and weight
to U.S. policies and initiatives, and the close U.S.-UK partnership has benefitted the pursuit of
common interests in bodies such as the UN, NATO, and other multilateral institutions.
The U.S.-UK political relationship encompasses an extensive network of individuals from across
the public and private sectors, but relationships between the individual national leaders are often
analyzed by some observers as emblematic of countries’ broader political relations.
Former Prime Minister Tony Blair established a close personal relationship with both President
Bill Clinton and President George W. Bush. The degree to which the UK subsequently influenced
U.S. policy choices in the war on terrorism, Iraq, and other issues has been a topic of much debate
on both sides of the Atlantic. Some observers contend that Blair played a crucial role in
convincing the Bush Administration to initially work through the United Nations with regard to
Iraq; that the priority Blair placed on resolving the Israeli-Palestinian conflict helped keep that
issue on the Bush Administration’s radar screen; and that the UK was instrumental in pressing for
a meaningful international peacekeeping presence in Afghanistan, which resulted in the creation
of the NATO-led International Security Assistance Force (ISAF).
Critics charge that Blair and the UK got little in return for their support of controversial U.S.
policies, pointing out that Blair was unable to prevent the United States from abandoning efforts
to reach a comprehensive international consensus regarding Iraq; that little progress was made on
the Israeli-Palestinian conflict; and that the U.S. response to Blair’s initiatives on issues such as
African development and climate change was tepid at best. Impressions of U.S. preponderance
formed in 2002-2003 have caused many to characterize the UK as the “junior” partner in the
relationship, and to note that the relationship has often appeared to be more “special” to the UK
than it is to the United States.
Blair paid a high political price with the British public and within his own Labour Party for his
close alliance with President Bush. The Blair-Bush years also launched debate in the UK about
whether future British prime ministers might think twice about boldly supporting controversial
U.S. policies or whether they might make more explicit demands of the United States as the price
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for support. Some British observers became anxious to assert that British national interests come
first in deciding British policy, that these interests are not always identical to U.S. national
interests, and that the UK should not be overly deferential to the United States in foreign policy
issues.
Upon taking over as prime minister in 2007, Gordon Brown attempted to maintain the “special
relationship” and made no major substantive changes in relations with the United States: he
maintained the UK’s commitment to a strong counterterrorism policy and to the mission in
Afghanistan, even if he proceeded with the planned withdrawal of British forces in Iraq, which
raised some questions and concerns among U.S. policymakers.
Prime Minister Brown pursued close relations with President Obama, but sensing that some
aspects of Brown’s initial reception by the U.S. president seemed ambivalent, critics speculated
about how much enthusiasm Obama felt about the bilateral relationship. Subsequently, some
observers continued to comment on what they perceived as President Obama’s lukewarm attitude
toward the British. Some observers have argued that Obama is the first post-war U.S. President
with no sentimental attachments to Europe: as U.S. foreign policy priorities focus increasingly on
the Middle East and Asia, some maintain that Europe, including the UK, faces a growing struggle
to remain relevant in U.S. eyes. In 2009 and 2010, media reports that Brown had been “rebuffed”
in numerous attempts to meet with Obama heightened anxiety in the UK about the future of the
“special relationship” and how it was viewed by the Obama Administration. At the same time,
some observers asserted that certain sources—in particular the British media—tend to read too
much into the appearance of personal relations between the individual leaders, noting that the
functional aspects of the U.S.-UK political relationship run much broader and deeper.
Some of the anxieties about the relationship were dissipated during President Obama’s state visit
to the UK in 2011, during which he repeatedly reaffirmed its importance. Prime Minister
Cameron subsequently came to the United States in 2012 in a visit designed to reaffirm U.S.-UK
ties and the personal relationship between Cameron and Obama. The two leaders discussed
cooperation on a broad range of international issues, and President Obama hosted the prime
minister at a state dinner. Prime Minister Cameron returned to the United States and visited with
President Obama at the White House again in 2013 and in January 2015. The two leaders have
cooperated closely and sought to align their countries’ positions in forums such as the United
Nations, NATO, the G-7/8, and the G-20, and on issues such as Ukraine, Russia, Syria, the
Islamic State, Iran, the Middle East Peace Process, Afghanistan, and TTIP.
Defense Relations
U.S. officials have been expressing their growing alarm about the potential effects of cuts to UK
defense spending and reductions in the size and capabilities of the British military (see “Austerity
and the Defense Budget” below).10 U.S. defense planners have long viewed the UK as one of the
most capable European allies—if not the most capable, alongside France—in terms of well-
trained combat forces and the ability to deploy them. Observers also note that the United States
and the UK have long tended to have similar outlooks on issues such as the use of force, the
development of military capabilities, and the role of NATO. Beyond the political bonds of similar
10 See Griff Witte, “U.K.’s Shrinking Military Clout Worries U.S.,” The Washington Post, March 2, 2015; “US Army
Chief ‘Very Concerned’ About Impact of Cuts on British Forces,” The Guardian, March 2, 2015; and “Military Cuts
Mean ‘No US Partnership’, Robert Gates Warns Britain,” BBC News, January 17, 2014.
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interests and values, some experts suggest that the United States has been more inclined to listen
to the UK than to other European allies because of the UK’s more significant military capabilities
and willingness to use them against common threats.
During the Cold War, the UK served as a vital base for U.S. forces and continues to host about
9,000 U.S. military personnel as well as airbases, equipment, radar sites, and intelligence centers.
As part of its cost-saving European Infrastructure Consolidation review, the U.S. Department of
Defense announced in January 2015 that U.S. personnel would pull out of three leased UK
airbases—RAF Mildenhall, which has served as a hub for transport and tanker aircraft and special
operations, RAF Alconbury, and RAF Molesworth. The U.S. Air Force plans to increase
personnel at RAF Lakenheath in anticipation of two squadrons of F-35s basing there by 2020.
U.S. and British forces have established extensive liaison, training, and exchange arrangements
with one another, with British officers routinely seconded to, for example, the Pentagon, U.S.
Central Command Headquarters in Tampa, FL, and U.S. Naval Headquarters in Norfolk, VA.
British sources reportedly often have access and input into U.S. defense planning and efforts such
as Quadrennial Defense Reviews.
A 1958 U.S.-UK Mutual Defense Agreement established unique cooperation with regard to
nuclear weapons, allowing for the exchange of scientific information and nuclear material. The
United States has leased to the UK the missile delivery systems for some of its nuclear warheads
since 1963. The UK’s nuclear deterrent consists of several Vanguard class submarines, each
armed with up to 16 Trident missiles.
The United Kingdom and the United States are also key partners in terms of defense industry
cooperation and defense sales. The two countries are engaged in more than 20 joint equipment
programs, including the F-35 Joint Strike Fighter (JSF). Most major U.S. defense companies have
a UK presence; led by BAE Systems, numerous British companies operate in the United States.
British defense companies’ U.S. operations tend to be part of a larger supply chain, with sales
consisting mostly of components and niche equipment, rather than entire platforms. U.S. foreign
military sales (government-to-government) agreements with the UK were approximately $692.6
million in FY2013.11 Shipment of U.S. direct commercial sales (contractor-to-government) to the
UK totaled approximately $208.6 million in FY2013.12
In 2007, in an effort to address long-standing British concerns about U.S. technology-sharing
restrictions and export controls, the countries signed a Treaty Concerning Defense Trade
Cooperation. The U.S. Senate passed a resolution of advice and consent to ratification of the
treaty in September 2010.13 The treaty eliminates individual licensing requirements for certain
defense articles and services controlled under the U.S. International Traffic in Arms Regulations
(ITAR). The agreement is reciprocal and is intended to cover defense equipment for which the
U.S. and UK governments are the end-users. It also calls for the creation of “approved
11 Defense Security Cooperation Agency, Fiscal Year Series, http://www.dsca.mil/sites/default/files/
fiscal_year_series_-_30_september_2013.pdf.
12 U.S. Department of State, Section 655 Annual Military Assistance Reports, https://www.pmddtc.state.gov/reports/
documents/rpt655_FY13.pdf.
13 The treaty is numbered 110-7.
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communities” of companies and individuals in each country with security clearances to deal with
technological transfers.14
Austerity and the Defense Budget
In 2014, the UK had the world’s fifth-largest military expenditure (behind the United States,
China, Saudi Arabia, and Russia), spending approximately £36.9 billion (about $61.8 billion).15
The UK is also one of the few NATO countries to consistently exceed the alliance’s tacit defense
spending benchmark of 2% of GDP (the UK’s defense spending was 2.4% of GDP in 2013 and
approximately 2.2% in 2014).
In 2010, the UK government released a Strategic Defense and Security Review (SDSR), the
country’s first such review since 1998, that set out the future structure of British military forces.16
The SDSR outlined a vision for a restructured British military by the year 2020 that is smaller but
highly flexible, maintains a high degree of readiness, and offers the full range of needed
capabilities. Fiscal pressures have had a substantial impact on the British military, however: the
SDSR triggered an 8% decrease in the UK’s defense spending over the period 2011 to 2015.17
The cuts have affected each branch of the British military, with the overall number of full-time,
trained service personnel decreasing by almost 31,000 since 2010, a 17% reduction in the size of
the armed forces.18 The British Army is expected to shrink from approximately 102,000 regulars
in 2010 to 82,000 by 2020, and the Royal Navy and Royal Air Force are each expected to
decrease by about 5,000 personnel over the same period.19 Experts assert that the cuts, combined
with other SDSR-associated decisions about equipment and operational readiness, have reduced
the UK’s conventional military combat capability by 20-30%.20 According to the International
Institute for Strategic Studies, “While the UK armed forces field a wide range of capabilities and
have the military culture, logistics and strategic lift to use them, the majority are close to critical
mass. This affects all the services and joint capabilities such as ISR.”21 In addition to the
downsizing of active service personnel, the number of UK Ministry of Defence civilian personnel
has been cut from nearly 86,000 in 2010 to just over 62,000, a 28% reduction.
Work on drafting a 2015 SDSR is expected to commence in the context of a general government
spending review following the May election. A March 2015 study by the Royal United Services
Institute (RUSI) projects that UK defense spending is set to dip below the 2% of GDP threshold,
excluding spending on operations, during the next fiscal year.22 The study asserts that an
additional £3 billion to £6 billion (approximately $4.5 to $9 billion) per year would be needed to
keep pace with expected GDP growth and hold defense spending at 2% of GDP for the period
14 The full text of the treaty can be accessed at http://www.state.gov/t/pm/rls/othr/misc/92770.htm.
15 International Institute for Strategic Studies, The Military Balance 2015, p. 21.
16 HM Government, Securing Britain in an Age of Uncertainty: The Strategic Defence and Security Review, October
2010.
17 The 8% decrease is in real terms (inflation-adjusted).
18 UK Ministry of Defence, UK Defence Statistics Compendium 2014, November 27, 2014.
19 Ben Farmer, “How Britain’s Armed Forces Numbers Are Diminishing,” The Daily Telegraph, January 21, 2015.
20 International Institute for Strategic Studies, op. cit., p. 68.
21 International Institute for Strategic Studies, op. cit., p. 70.
22 Malcolm Chalmers, Mind the Gap: The MoD’s Emerging Budgetary Challenge, Royal United Services Institute,
March 2015.
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2016-2020. Prime Minister Cameron has thus far declined making a commitment to maintain
defense spending at 2% of GDP should he win reelection as prime minister. The RUSI report
projects that a continued squeeze on the UK’s defense spending could see the personnel level of
the armed forces drop from the current 145,000 to as low as 115,000 to 130,000.23 Some
observers have suggested that continued austerity during the next Parliament could produce plans
to cut the British Army down to 60,000.
A March 2015 report by the House of Commons Defence Committee argues that the assumptions
underlying the 2010 National Security Strategy and the force structure concept for 2020 are not
sufficient given subsequent changes in the security environment that present increased challenges
on the borders of Europe and in the Middle East, Africa, and South Asia.24 The report asserts that
further reductions in defense expenditure would damage the UK’s credibility as a military ally. It
also urges rebuilding conventional capabilities that have been reduced since the Cold War as a top
priority, noting that providing a stronger conventional deterrent against an advanced military state
such as Russia would require a significantly increased defense budget. At the same time, the
report recommends continuing to build capabilities related to “next generation” warfare,
including cyber defense and cyber warfare, and combating asymmetric or hybrid warfare tactics.
Intelligence and Counterterrorism Cooperation
Most analysts and officials agree that U.S.-UK intelligence and counterterrorism cooperation is
close, well established, and mutually beneficial. UK agencies routinely cooperate with their U.S.
counterparts in sharing information, and U.S. and British law enforcement and intelligence
agencies regularly serve as investigative partners. Although many of the details and achievements
remain secret, U.S.-UK intelligence and counterterrorism cooperation has reportedly disrupted
multiple terrorist operations against both countries in recent years, including a plot against the
New York Stock Exchange and World Bank in 2004, a major plot against transatlantic aviation in
2006, and a cargo airplane bomb plot in 2010.25
The overall intelligence and counterterrorism relationship is overwhelmingly positive, but there
have been some occasional tensions. The relationship was damaged by public accusations of
British complicity in U.S.-led renditions and the alleged torture of terrorist suspects between 2002
and 2008. Related court cases sought the release of intelligence documents and raised concerns in
the intelligence community about the risk of confidential information entering the public domain
through the British legal system. In part to preserve the integrity of UK intelligence-sharing with
the United States, the British government adopted the Justice and Security Act in 2013, permitting
evidence to be heard in secret on national security grounds in British civil courts.
There have also been some tensions about extradition arrangements. Although the UK extradited
radical Islamist cleric Abu Hamza al-Masri to the United States in 2012 to face trial on terrorism-
related charges, U.S. officials were frustrated that the process took eight years after the original
U.S. request. British officials have rejected other U.S. extradition requests on human rights
23 According to the UK Defence Statistics Compendium 2014, there were 146,980 full-time, trained personnel as of
October 1, 2014.
24 House of Commons Defence Committee, Re-Thinking Defence to Meet New Threats, March 24, 2015,
http://www.publications.parliament.uk/pa/cm201415/cmselect/cmdfence/512/512.pdf.
25 See British Prime Minister’s Office, US and UK Counterterrorism Cooperation, http://www.number10.gov.uk/news/
counterterrorism-cooperation/.
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grounds, and UK courts have blocked some U.S. extradition requests for terrorist suspects
because of insufficient or inadmissible evidence. Some UK legal experts and human rights
activists criticize the terms of the current U.S.-UK extradition treaty as being more favorable to
the United States. U.S. officials counter that an independent review commissioned by the UK
government concluded in 2011 that the treaty is fair and balanced, with U.S. and UK evidentiary
standards being the same in practice.26
In 2013, reports based on leaked, classified documents obtained from a former U.S. National
Security Agency (NSA) contractor focused on surveillance operations allegedly conducted by the
NSA and the UK’s Government Communications Headquarters (GCHQ, the UK’s signals
intelligence agency). Under the Tempora program, which has not been acknowledged by GCHQ,
the UK has reportedly tapped into undersea transatlantic fiber-optic cables that carry international
telephone and internet traffic. Media reports have suggested that the NSA and GCHQ worked
together on at least some aspects of collection operations and have shared information gathered
from these programs with each other.
UK civil liberty and privacy groups have questioned the legality of GCHQ’s reported Tempora
program and have claimed that GCHQ circumvented UK law by using the NSA’s PRISM
program to access the content of private communications of UK citizens. British officials have
denied such allegations and asserted that all intelligence-sharing with the United States takes
place within the law. The British government has been largely silent in public about the alleged
NSA and GCHQ activities, asserting that it does not comment on intelligence matters. In March
2015, the UK Parliament’s Intelligence and Security Committee concluded its inquiry into the
extent of UK surveillance activities with a report asserting that the country’s intelligence agencies
do not seek to circumvent the law, but that the legal framework governing their activities is overly
complicated and lacks transparency. The report recommends replacing all relevant legislation
currently in force with a new, single Act of Parliament that clarifies authorization procedures,
privacy constraints, transparency requirements, and other safeguards.27
The International Center for the Study of Radicalisation (ICSR) and official British government
sources estimate that 500 to 600 people have travelled from the UK to fight in Syria and Iraq.28
Other sources suggest that this figure represents a minimum estimate, with the actual number as
high as 1,000 to 2,000.29 UK authorities have been actively concerned about this trend since 2011,
but the issue has gained a higher profile with the appearance of identified or presumed British
fighters in several Islamic State propaganda videos since mid-2014. British fighters in Syria have
also reportedly carried out suicide bombings, and researchers have confirmed the deaths of at
least 26 individuals who have travelled from the UK to fight.
The UK government believes that up to 250 individuals that trained or fought in Syria or Iraq
have already returned home to the UK. Given the potential for returning extremists to plot attacks
26 For more information, see “Frequently Asked Questions on the U.S.-UK Extradition Relationship,” Embassy of the
United States to the United Kingdom, April 2013, http://london.usembassy.gov/gb176.html.
27 Intelligence and Security Committee of Parliament, Privacy and Security: A Modern and Transparent Legal
Framework, March 12, 2015.
28 Peter R. Neumann, Foreign Fighter Total for Syria/Iraq Now Exceeds 20,000; Surpasses Afghanistan Conflict in the
1980s, International Centre for the Study of Radicalisation, King’s College London, January 26, 2015, http://icsr.info/
2015/01/foreign-fighter-total-syriairaq-now-exceeds-20000-surpasses-afghanistan-conflict-1980s/.
29 See, for example, Radio Free Europe/Radio Liberty, Foreign Fighters in Iraq and Syria, updated January 29, 2015,
http://www.rferl.org/contentinfographics/infographics/26584940.html.
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on domestic targets, the UK’s Joint Terrorism Analysis Centre raised the country’s terror threat
level from “substantial” to “severe” in August 2014, indicating that an attack is highly likely.30
Since the London terrorist attacks of July 7, 2005, authorities have reportedly disrupted
approximately 40 major terrorist plots against the UK.31
In response to the foreign fighters threat, the UK adopted a new Counter-Terrorism and Security
Act in February 2015 that enhances the country’s already extensive body of counterterrorism
legislation. The new act:32
• broadens the powers of police and border officials to temporarily confiscate the
passports of terrorism suspects for up to 30 days;
• introduces new Temporary Exclusion Orders banning suspected terrorists with
British passports from the country for two years and placing strict conditions on
their return;
• reintroduces the power to relocate suspects within the UK and limit the distance
they may travel;
• requires mobile phone and internet service providers to retain data allowing
relevant authorities to identify the individual or device that was using a particular
internet protocol (IP) address at a given time;
• requires air, maritime, and rail carriers to provide additional passenger, crew, and service
information, including passenger credit card details, in advance of travel;
• places a new legal duty on relevant institutions (ex., prisons, universities, schools, and
mosques) to report extremism and develop policies to deal with radicals and extremist
speakers;
• makes it illegal for insurance companies to cover terrorist ransom payments; and
• creates a Privacy and Civil Liberties Board to assist the Independent Reviewer of
Terrorism Legislation in monitoring the operation and impact of the UK’s
counterterrorism legislation.
Economic Relations
The U.S.-UK bilateral investment relationship is the largest in the world. In 2013, U.S. foreign
direct investment (FDI) in the UK was $571 billion. Total U.S. corporate assets in the UK stood
at nearly $5 trillion in 2013, representing 22% of total U.S. corporate assets abroad. UK corporate
assets invested in the United States totaled nearly $2.4 trillion in 2013, with UK FDI in the
United States at $518.6 billion for that year. In 2013, UK affiliates employed about 987,000 U.S.
workers, and U.S. firms employed approximately 1.27 million people in the UK.33
30 See Raffaello Pantucci and Clare Ellis, “The Threat of ISIS to the UK,” Royal United Services Institute, October
2014, https://www.rusi.org/downloads/assets/102014_ISIS_Threat_Assessment.pdf; and Raffaello Pantucci, “Britain’s
Terror Threat From The Levant,” CTC Sentinel, January 20, 2015, https://www.ctc.usma.edu/posts/britains-terror-
threat-from-the-levant.
31 “UK Faces Biggest Terrorism Threat in Its History - Theresa May,” Reuters, November 24, 2014.
32 http://www.legislation.gov.uk/ukpga/2015/6/contents/enacted.
33 Statistics from Daniel S. Hamilton and Joseph P. Quinlan, Center for Transatlantic Relations, Johns Hopkins
(continued...)
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Tourism and trade are also important pillars of the economic relationship. In 2013, U.S. residents
made 2.64 million trips to the UK, and there were over 3.8 million British visitors to the United
States.34 In 2014, U.S. exports of goods to the UK were worth nearly $53.9 billion, and U.S.
imports from the UK were worth over $54 billion.35
The European Commission negotiates a common EU trade policy on behalf of its member states,
and therefore UK trade policy is formulated within an EU context. The UK has been a consistent
supporter of U.S.-EU efforts to lower transatlantic and global trade barriers, and UK officials and
business leaders have reacted with strong support to the prospect of the Transatlantic Trade and
Investment Partnership under negotiation between the United States and the EU.
Conclusion
Most analysts agree that the U.S.-UK political relationship is likely to remain close; that the
“special relationship” will remain strong on many vital issues in which the UK is a crucial U.S.
ally; and that the two countries will remain key economic partners. Observers also assert that the
main dimensions of the U.S.-UK relationship are deep and enduring in that they go beyond the
personal dynamics of individual leaders and are not subject to sudden moves or policy shifts by
either country. Analysts observe that many concerns and assertions about an impending break-up
of the “special relationship” tend to be exaggerations.
Nevertheless, many analysts believe that some reassessment of the “special relationship” may be
in order. Despite its dominant themes of continuity, the relationship is changing primarily because
its geopolitical setting has been changing. The U.S.-UK relationship often remains uniquely close
and capable of projecting a considerable degree of power and influence, but there are questions
about whether the relative influence and centrality of the relationship is facing a decline. Both
countries have sought to adjust their foreign policy approaches to deal with new global challenges
and emergent geopolitical trends that are often perceived as the “rise of new powers” or the
diffusion of power away from “the West.” In many cases, responses to global challenges continue
to reinforce not only the relevance of U.S.-UK cooperation, but the still-frequent role played by
the two countries working together to drive international action. In an increasingly “G-20 world,”
however, the UK may not be viewed as centrally relevant to the United States in all of the issues
and relations considered a priority on the U.S. agenda.
Similar to the United States, the key long-term foreign policy challenges for the UK are likely to
revolve around how to define its relationships with emerging powers; how to maintain global
influence and relevant capabilities given limited resources; and how to maximize existing
partnerships and multilateral frameworks (including NATO, the EU, and the United Nations).36
Meanwhile, many observers assert that a significant degree of the UK’s international influence
flows from the success and dynamism of the British economy, further raising the stakes on
(...continued)
University School of Advanced International Studies, The Transatlantic Economy 2015, p. 93.
34 http://travel.trade.gov/outreachpages/download_data_table/2013-US-to-Europe.pdf and http://travel.trade.gov/
outreachpages/download_data_table/2013_UK_Market_Profile.pdf
35 U.S. Department of Commerce, United States Census Bureau, Trade in Goods with United Kingdom,
https://www.census.gov/foreign-trade/balance/c4120.html.
36 See HM Government, A Strong Britain in an Age of Uncertainty: The National Security Strategy, October 2010.
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whether the UK can sustain stronger economic growth while continuing to pursue ambitious
fiscal consolidation.
The management of the UK’s relations with the EU will also bear watching over the next several
years. Some analysts argue that life on the margins of an EU more integrated around the
Eurozone need not be disastrous for the UK. Both the positive and the negative aspects of a
prospective life outside the EU are more difficult to foresee. Envisioning an EU without the UK,
many analysts observe that British participation is widely regarded as essential for efforts to
develop more robust EU foreign and defense policies. Analysts also assert that the departure of
the UK could change the economic character of the EU because the UK generally acts as a
leading voice for economic liberalism in EU debates about trade and the single market.
As has been reportedly expressed in conversations between President Obama and Prime Minister
Cameron and related bilateral discussions between U.S. and UK officials, these considerations are
of central interest to U.S. policymakers who are concerned about a potential UK departure from
the EU. With the UK commonly regarded as the strongest U.S. partner in Europe and a partner
that commonly shares U.S. views, senior Administration officials have reportedly conveyed their
concerns that a UK break from the EU would reduce U.S. influence in Europe, weaken the EU’s
position on free trade, and make the EU a less reliable partner on security and defense issues.
Author Contact Information
Derek E. Mix
Analyst in European Affairs
dmix@crs.loc.gov, 7-9116
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