With Europe beset by challenges to its internal unity, a trade deal with its most important partner might seem an easy way to shore up foundations as it grapples with crises ranging from Middle Eastern migration to Russian belligerence.
But the fact that U.S. President Barack Obama made such a strong case in Germany this past weekend for the the Trans-Atlantic Trade and Investment Partnership could bode that its benefits aren’t self-evident to average citizens on either side, especially as trade takes a beating in the U.S. presidential primaries.
A few days before Mr. Obama met German Chancellor Angela Merkel at HanoverMesse, one of the world’s largest trade fairs, former German economy and defense minister Karl-The0dor zu Guttenberg was in Atlanta to address a German-American Cultural Foundation luncheon.
Interviewed at the Mandarin Oriental in Buckhead after the event, he told Global Atlanta that while the prospects for wrapping up the so-called TTIP deal by the end of the year are dim, the stakes are high, particularly insofar as the deal affects a security relationship that needs a jolt of confidence.
“It’s an enormously strong factor, and it’s highly underestimated,” Mr. Guttenberg said of the deal’s import for the transatlantic dynamic. “It ties us more together, and it would be an illusion to believe that either the U.S. or we would be capable of tackling any of those challenges we are facing right now just by ourselves. Isolationism is not a solution, nor is a more aggressive behavior toward each other.”
Negotiations, which start their most recent round this week, have been collegial but undeniably slow in producing the desired progress as they’ve aimed to find ways to cut red tape and eliminate competing standards that cost companies billions in redundant testing for each market.
Agricultural issues are among the thorniest. The U.S. side has sought to chip away protections on “geographic indicators”, products like champagne, a lot of which is produced in California but which France reserves as a mark exclusively for sparkling wine grown in its namesake region. Europeans have also argued to include financial services in the deal and to create a mechanism for fairer and more transparent procurement rules in the U.S., especially at the state level.
Mr. Guttenberg said the appetite for compromise will reflect on the security relationship at a time when democratic institutions, especially in Europe, are having their dexterity in handling new challenges tested. The rise of populist movements across Europe, fueled by fundamental economic and demographic shifts, plus an ever-changing security environment, are adding to these pressures.
“When you look at the global challenges now, the most predictable thing is the unpredictability, and it is more important that multinational institutions are flexible not only to react but also to be proactive,” said Mr. Guttenberg, who now runs New York-based advisory firms Spitzberg Partners.
The North Atlantic Treaty Alliance is a prime example, he said, drawing on his experience reforming the German Bundeswehr during his time as defense minister.
“There you need to restructure old structures, and a couple of attempts have been made already, but this again has an emotional tie of whether a TTIP solution would be possible,” he said. “If that fails, the willingness on both sides to make necessary reformist steps will also be somehow endangered, because there again we have the effect of desolidarization on the transatlantic level. Nobody can wish to have that.”
The trend encapsulated in that complex word — desolidarization — is worryingly common in a Europe that is seeing the core drivers of its integration questioned, he said.
Even as a bloc of 28 nations, the EU struggles to define “our elementary set of values which could be considered European, as such.” How much sovereignty nations should relinquish to avail themselves of the EU’s benefits is still an open question, as evidenced by the upcoming debate and vote on the United Kingdom‘s place in it.
While it has produced an “admirable peace dividend” by through unification, Europe has to let go of the “romanticism” of its past, embracing the “power of the fact” that European development is destined to be uneven and that its varying cultures mean it’s unlikely to produce a “United States of Europe,” Mr. Guttenberg said,.
“What we need to do now is actually adapt the treaties to the realities of existing concentric circles, of existing different speeds and different backgrounds.”
To learn more about the German-American Cultural Foundation, through which influential companies and individuals underwrite many of Atlanta’s German cultural institutions including the Goethe Center, visit www.gac-foundation.org.