European Union

  • United Kingdom
    Brexit Deal Shakes Up May's Cabinet, and APEC Summit Overshadowed by Trade War
    Podcast
    A Brexit deal triggers a political crisis in Britan, trade wars loom large as the APEC Summit gets underway, and an Ebola outbreak in Congo threatens to spread. Ted Alden sits in for Bob McMahon.   
  • European Union
    See How Much You Know About the European Union
    Test your knowledge of the EU's history, institutions, economy, and more.
  • China
    The Global Artificial Intelligence Race
    Play
    Panelists discuss the global race for leadership in artificial intelligence, and provide an analysis of major AI legislation and initiatives in China, the European Union, and the United States. 
  • Italy
    Does Italy Threaten a New European Debt Crisis?
    Italy’s populist government has relished defying the European Union, and its latest showdown with Brussels could threaten the continent’s fragile recovery—and the global economy.
  • United Kingdom
    Brexit Isn’t the Only Shock Hanging Over Britain
    While most attention focuses on the implications of Brexit, the Labour Party's Marxian hard leftism should cause us equal, if not more, concern.
  • Spain
    A Conversation with Pedro Sánchez
    Play
    Prime Minister Pedro Sánchez discusses the new Spanish administration’s domestic agenda, Spain’s role in the European Union, and U.S.–Spain relations.
  • Hungary
    Europe Wrestles With Hungary’s Populist Challenge
    The European Parliament’s vote to reprimand Hungary over its growing authoritarianism has tested the EU’s readiness to stand up to illiberalism within the bloc.
  • United Kingdom
    Brexit, Voice, and Loyalty: Britain’s Torturous EU Exit and the Dilemmas of National Sovereignty
    In choosing to leave the EU, British voters decided that Brexit was the only way to preserve their national sovereignty. But in choosing to leave that club, they are experiencing the trade-offs inherent in modern sovereignty.
  • European Union
    Managing Global Disorder: Prospects for Transatlantic Cooperation
    In July 2018, the Council on Foreign Relations’ Center for Preventive Action convened a workshop to examine areas of cooperation between the United States and the European Union. The workshop was made possible by the generous support of the Carnegie Corporation of New York. The views described here are those of the workshop participants only and are not CFR or Carnegie Corporation positions. The Council on Foreign Relations takes no institutional positions on policy issues and has no affiliation with the U.S. government. Introduction Despite recent turbulence in the transatlantic relationship, the United States and the European Union share a common interest in managing emerging sources of global disorder. To explore prospects for and challenges to transatlantic cooperation, the Center for Preventive Action at the Council on Foreign Relations convened an international group of twenty-three experts at the Tufts University Center in Talloires, France, on July 12–13, 2018, for the workshop “Managing Global Disorder: Prospects for Transatlantic Cooperation.” The workshop is the third in a series of meetings supported by the Carnegie Corporation of New York. It is premised on the belief that the United States, China, the European Union, and Russia not only share a common interest in preventing the world from becoming more dangerous and disorderly, but also that the nature and scope of this task necessitates cooperation among them. Workshop participants discussed their perceptions of the growing sources of disorder in the world, examined areas of strategic cooperation, and explored where the United States and the European Union might work together to address a variety of regional concerns emanating from Africa, China, the Middle East, and Russia. While highlighting how the two can work together to address increasing political instability and violent conflict, participants also cited the importance of the transatlantic relationship in preventing or mitigating the demise of the liberal international order. The Changing Domestic Context for Transatlantic Cooperation Participants agreed that the United States and the European Union are facing a seismic shift in the global order. A Western agenda no longer determines global norms; rather, the West has fragmented and the digital age has undermined the social and international order, creating systemic social dislocation. Compounded by fears over the future of work and employment in the face of artificial intelligence, automation, and globalization, this dislocation is reflected in the rise of nationalism and nativism across the United States and the European Union. Domestic politics have merged with international trends. Participants largely agreed that three domestic issues trouble most American voters: the future of work, the future of the U.S. immigration system, and the future role of the United States on the international stage. Several participants argued that the election of President Donald J. Trump reflects these voter concerns, and suggested that the post–World War II liberal international order has been an aberration in the arc of U.S. foreign policy. Europe faces similar challenges. Participants posited that anxieties over work and globalization have prompted concerns about the future of the European Union and have contributed to the rise of the far right in EU member states such as Hungary and Poland as well as in Turkey. For some participants, the rise of the far right could be an indicator of the transatlantic alliance’s future: an alliance among far right parties focused on undermining global institutions. Moreover, participants agreed that the manipulation of public opinion will increasingly affect the future of political systems. Europe in particular has witnessed the manipulation and polarization of political parties and public opinion on issues like capitalism and free trade. Acknowledging these trends, one participant stated that “the primary challenge facing the West is the West itself.” All participants agreed the United States and the European Union should work both independently and together to address the future of work, immigration, and socioeconomic integration and focus on sustaining a narrative of popular support for the transatlantic relationship in order to resolve the underlying issues of nationalism and populism. As the United States retreats from its global leadership role, one participant suggested that the European Union should continue to prepare for strategic autonomy and that “preparing for a post-American future is not inconsistent with preparing for the return of a future American partner.” The Future of Global Governance All participants agreed that the election and subsequent actions of President Trump catalyzed the decline of the liberal international order. Global governing institutions were already under-performing before Trump assumed office, straining under numerous transnational challenges, but the Trump administration’s pursuit of U.S. autonomy and its apparent abandonment of global, multilateral leadership roles has resulted in the degradation of transatlantic relations. Participants questioned whether the U.S. abdication of leadership represents a lack of trust in international institutions or an actual crisis of democracy. They also asked whether the transatlantic agenda will continue to uphold the liberal international order, or become simply transactional cooperation when needs collide (e.g., on regional security concerns in Asia, Europe, and the Middle East and on strategic concerns over the future of cyberspace). The United States and the European Union continue to share common policy goals and interests, but the lack of predictability in U.S. foreign policy has resulted in what one participant described as a return to Hobbesian international relations. Although U.S. and EU political leaders diverge over their strategic aims, participants agreed that agreements may still function in what one participant termed “compartmentalized cooperation.” The United States and the European Union remain broadly aligned on counterterrorism efforts, deterring cyber aggression, and the prevention of the proliferation of nuclear weapons and weapons of mass destruction. In contested areas, such as climate change, migration, outer space, and trade, participants suggested that subnational agreements (e.g., California Governor Jerry Brown’s climate change partnership with EU leaders) and civil society forums (e.g., French President Emmanuel Macron’s Paris Peace Forum) could function in the absence of high-level U.S. leadership. But although participants accepted that compartmentalized cooperation will serve short-term interests, they disagreed over whether continued cooperation illustrates the resilience of the global governance system. Some participants argued that future cooperation will take place at the subnational level as short-term issues are favored over long-term strategic problems and that formal global governance will be substituted over time by informal, ad hoc cooperation on an array of issues. For the European Union, participants agreed that strategic autonomy will be critical in the absence of U.S. leadership. One participant argued that the European Union should adopt a global strategy and approach democracy as a critical infrastructure project, clarifying how and why democracy matters. For the sake of the transatlantic alliance and the future of the West, participants agreed that the United States and the European Union should become advocates for the liberal international order or risk losing primacy to competing narratives from China and Russia. Potential Areas of Regional Cooperation Despite these concerns, participants identified four regions where the United States and the European Union could coordinate in areas of strategic interest to prevent conflict and potentially bolster the transatlantic alliance. Russia                                        Participants agreed that the long-term challenge from Russia is its ability to undermine Western unity, whether through disinformation campaigns, election meddling, or the use of limited war to transform the international system. As one participant stated, China is a threat because it is a rising power, while Russia is a threat because it is a declining power. Despite Russian aggression, participants agreed that the United States and the European Union should continue to hold dialogues and identified strategic arms control as one area of interest ripe for cooperation. Participants agreed that the United States and the European Union should remain in discussions with Russia on the New START and Intermediate-Range Nuclear Forces treaties. Participants also agreed that the United States and the European Union should adopt a unified approach to Russian cyber efforts, but acknowledged that the likelihood of reaching an agreement with Russia itself was slim. Participants were more optimistic in discussing areas of U.S.-EU-Russia regional cooperation, particularly in the Middle East. Participants recognized that solutions to the conflicts in Iraq, Libya, and Syria would not be possible without including Russia in negotiations. However, to prevent Russia from overtaking transatlantic interests in the region, participants agreed that the United States and the European Union should adopt a unified transatlantic strategy (though they also acknowledged that creating such a strategy is not realistic under the Trump administration). Finally, participants discussed the security architecture in Europe and suggested that the United States and the European Union work to deescalate tension with Russia by clarifying rules of the road for contact, including political interference. Participants suggested that dialogue would build a foundation for mutual confidence and cooperation that could cross over into other areas of strategic interest. China Participants agreed that China views global governance, trade, sovereignty, and human rights in a fundamentally different way than the United States and the European Union do, leaving opportunity for transatlantic coordination on areas of strategic interest. Unfortunately, participants also acknowledged that, given internal European politics and the Trump administration’s policies, it may be difficult for the United States and European Union to develop a cohesive China strategy. On trade, the United States and the European Union have been largely successful in advocating for stronger intellectual property protections, promoting market access, and coordinating pushback against laws and regulations discriminating against foreign entities. However, several participants noted that EU member states are divided in their response to Chinese investment and trade, as some EU states privilege short-term money flows over long-term consequences, thus making high-level U.S.-EU-China trade agreements difficult. With Chinese President Xi Jinping’s consolidation of power, participants noted that China has asserted sovereignty claims more firmly in critical areas, including Taiwan and the South China Sea. Participants noted that the United States and European Union agree on the strategic importance of Taiwan and the South China Sea, but differ in their approaches to both. The United States has made Taiwan an important component of its China policy, while the European Union has not. In the South China Sea, the United States and European Union do coordinate on freedom of navigation operations, but differ in the manner in which they exercise their rights. In terms of future cooperation, participants agreed that the United States and European Union should continue to challenge China on its human rights violations, hold Xi to account on China’s climate change advocacy, attempt to reach an agreement with China on internet governance (which may be difficult given divergent U.S. and EU views), and work with China to establish common standards and lending regulations for its Belt and Road Initiative. The Middle East In the Middle East, participants agreed that the United States and the European Union share concerns over terrorism and the stabilization of Libya and Yemen, but diverge on approaches to Iran and the Joint Comprehensive Plan of Action (JCPOA), as well as the conflict between the Israelis and the Palestinians. Some participants also emphasized that, although the Middle East is geostrategically critical for EU security, EU member states do not follow a coordinated Middle East strategy. Moreover, several participants identified a potential flashpoint in U.S.-EU coordination in the Middle East over a possible Iran-Israel confrontation; they expressed misgivings over whether the United States and European Union would present a united transatlantic front in the face of armed conflict. Regardless, opportunities for cooperation exist and include counterterrorism initiatives and stabilization efforts across the Middle East, particularly in Syria, Tunisia, and Yemen. Participants flagged the Global Coalition to Defeat ISIS as an example of multiple consecutive U.S. and European administrations sharing best practices, intelligence, and labor. As postconflict situations emerge, participants agreed that the United States and European Union will continue to coordinate on regional stabilization, but that the United States is less likely to commit itself to any long-term reconstruction efforts. Africa Participants agreed that the need for a coordinated transatlantic strategy toward Africa is paramount, as Africa faces the “perfect storm” of a demographic bulge, climate change, and the uncertainty of the future of work on the continent. However, although the United States and the European Union share concerns over migration, peacekeeping, and terrorism in Africa, participants recognized that a coordinated transatlantic approach may be difficult. The United States does not currently prioritize Africa in its foreign policy agenda, nor does it involve African countries in high-level dialogues, preferring bilateral interactions and military approaches to resolving conflict. Participants noted that the converse is true for Europe: African stability is critical for regional security, particularly as it affects migration, but the European Union often opts for diplomacy and multilateral initiatives over military operations. Although the United States and the European Union have adopted different strategic approaches to African relations, participants identified several areas for a coordinated transatlantic strategy: counterterrorism efforts in the Sahel against international criminal and terrorist networks, democracy promotion in fragile states, and civil society and private sector work on climate change. Recognizing that current crises are the result of short-term policy and spillover from ongoing conflicts, participants agreed that the United States and the European Union should develop security agreements in Africa, focusing on economic and humanitarian tools to address the needs of younger generations. Participants concluded that diplomacy and prevention in Africa will be critical in handling the approaching perfect storm. Recommendations Participants noted that the international system faces fundamental, strategic, and systemic shifts that may outlast current U.S. and EU governments. Participants remain pessimistic that China and Russia will seek to keep the liberal international order as both countries see little incentive to do so and have experienced limited repercussions in deviating from established international norms. Participants also agreed that the United States and European Union are unlikely to adopt a cohesive transatlantic strategy toward China and Russia, but expressed hope for cooperation in other areas of strategic and regional importance, including in Africa and the Middle East. As a result, participants suggested that the United States and European Union use this inflection point to reconsider the benefits of the liberal international order, and potentially ensure its survival by developing a cohesive strategy and pursuing the following: Identify areas where civil society and private sector actors can take the lead on contentious issues, including climate change. Pursue specific strategic areas of cooperation below the senior levels of government to maintain dialogue and ensure the pursuit of national security interests. Potential areas of cooperation include arms control agreements and counterterrorism efforts. Prepare for European strategic autonomy, despite internal European political disputes. Though Europe is preparing for a post-American future, its efforts do not preclude the return of U.S. power. Empower the periphery: those actors who operate at the sub-state level. As societies grow increasingly interconnected, the traditional state-based framework may need to flex and allow for nonstate civil society actors to work on transnational issues.
  • Germany
    Nord Stream 2: Is Germany ‘Captive’ to Russian Energy?
    President Trump has targeted Germany over its supposed dependence on Russian natural gas, and the proposed Nord Stream 2 is dividing the EU. What’s in store for Europe’s pipeline politics?
  • European Union
    Brexit Deliberations Continue and New U.S. Sanctions on Iran Take Effect
    Podcast
    Brexit negotiations continue between Theresa May and Emmanuel Macron, new U.S. sanctions on Iran take effect, and Japan commemorates the seventy-third anniversaries of the bombings of Hiroshima and Nagasaki.
  • International Economic Policy
    Is Trump Right About the Strong Dollar? Not According to Our Mini Mac Index.
    var divElement = document.getElementById('viz1532315434641'); var vizElement = divElement.getElementsByTagName('object')[0]; vizElement.style.width='600px';vizElement.style.height='497px'; var scriptElement = document.createElement('script'); scriptElement.src = 'https://public.tableau.com/javascripts/api/viz_v1.js'; vizElement.parentNode.insertBefore(scriptElement, vizElement);       The “law of one price” holds that identical goods should trade for the same price in an efficient market.  But how well does it actually hold internationally? The Economist magazine’s Big Mac Index uses the price of McDonald’s Big Macs around the world, expressed in a common currency (U.S. dollars), to measure the extent to which various currencies are over- or under-valued. The Big Mac is a global product, identical across borders, which makes it an interesting one for this purpose. But the law of one price assumes there are no restrictions on, or costs involved in, the movement of goods, and Big Macs travel badly. So in 2013 we created our own Mini Mac Index, which compares the price of iPad minis across countries. Minis are a global product that, unlike Big Macs, can move quickly and cheaply around the world. As explained in the video here, this helps equalize prices. As shown in the graphic at the top, the Mini Mac Index suggests that the law of one price holds far better than does the Big Mac Index. The dispersion of prices is much narrower when measured by Minis. The Big Mac Index shows the dollar overvalued against most currencies, by an average of 37 percent (a Whopper). The euro is undervalued by 14 percent, the South Korean won by 27 percent, the Japanese yen by 36 percent, the Chinese RMB by 44 percent, and the Mexican peso by 53 percent. This certainly accords with President Trump’s narrative—that the dollar is too strong, that other countries are manipulating their currencies for competitive advantage, and that dollar overvaluation is fueling America’s trade deficit. In contrast to the Big Mac Index, our Mini Mac Index actually shows the dollar undervalued—though only by 3 percent on average (small fries). The euro is overvalued by 6 percent, the South Korean won by 5 percent, the Chinese RMB by 4 percent, and the Mexican peso by 12 percent. Among America’s usual suspects for currency manipulation, only Japan has an undervalued currency—by 6 percent. In short, we think the president should hold the relish. His claims don’t cut the mustard.