Zukunft der transatlantischen Beziehungen

Ladies and Gentlemen,

I am really feeling privileged for having this opportunity to address such a distinguished gathering. And I would like to thank the Center for Strategic and International Studies and the Friedrich Ebert Foundation for organizing this event.

I have been here in Washington so often and have always been caught up in its unique spirit. Every visit, every meeting with your think tanks, is an intellectual challenge. There is probably no city in the world where politics is discussed more passionately and on a more informed basis.  This may be one of the reasons why Washington is not every day and everywhere in the rest of the country the most beloved capital.

I am here at an extraordinarily interesting time as President Obama embarks on his second term of office. Yesterday in his State of the Union address President Obama made it strikingly clear that he is not interested in simply carrying on as before. He faces difficult tasks: consolidating the budget, fighting for new jobs and strengthening the real economy. Now also, however, if he likes it or not, the fight for “legacy” begins – and this is a matter of the long view, the strategic dimension of politics.

In Germany, too, we are at the beginning of an election year which promises to be quite exciting. One thing is already clear: since the state election in Lower Saxony three weeks ago, Angela Merkel and her coalition have already lost their majority in our second chamber, the Bundesrat. Despite her undoubted popularity, politically speaking, concerning legislation, she is, as you say here, a lame duck.  Whatever the outcome of the elections in September, one thing is certain: as from September 2013 there will be a different constellation shaping German politics. And I am quite sure that my party, the German Social Democrats, will be a governing party at the end of the year.

2013 is set to be a year in which a new course is charted in both German and American politics. But if I am not mistaken, we also stand at a crossroads in transatlantic relations. I do not think I will offend anybody if I say quite baldly that the transatlantic relationship has known better times. In recent years Europe and the USA have each been primarily fixated inwards on themselves. In Europe political energies have been almost completely absorbed by the economic and monetary crisis, a subject I will return to in a little more detail in a moment.

The USA, too, continues to suffer from the aftermath of the Lehman Brothers shock. Those who after these events still had the strength to look to the world beyond their own borders talked about the end of the Atlantic era and the famous pivot to Asia. Where foreign policy was discussed at all, then it was about China and its future role in the world. Transatlantic  - that was something for old men from the East Coast. The music was being made somewhere else. 

That was how the situation was until just recently. But if I am not deceived, signs are just emerging of a “rebalancing”. It is apparent to me from the discussion surrounding the recently published Global Outlook 2030 that Asia continues to be a focus of interest for America. Yet I also detect that there may be some who question whether in terms of its foreign policy interests, America has overstressed its pivot to Asia. They are wondering: is this a case of throwing the baby out with the bathwater? Is an American policy that favors its transpacific over its transatlantic leg in danger sooner or later of stumbling – to the detriment of its own country and the rest of the world?   

The weekend before last I was at the Security Conference in Munich, sitting on a panel with Bob Zoellick. Your Vice-President, Joe Biden, gave an impressive speech there, a rousing call to revitalize the transatlantic partnership, very different from the customary platitudes which we all know and are sometimes tired of hearing. I at least detected a new tone – openness, curiosity, but also great expectations in terms of strategic responses from the “old continent”.

I am here to give my answer to Joe Biden: my party and I myself will try to match your openness with our own openness, your curiosity with our curiosity and your expectations with our own offers for talks and action. We want to place the transatlantic partnership on a new, robust footing. And we know that it has to be based on more than an endless repetition of old oaths of loyalty. The future of transatlantic relations depends on whether we succeed in finding common responses for tomorrow, responses that are based on a strategic vision.

The figures speak clearly: more than 50 per cent of all direct investments in the USA come from Europe. And the same applies in the reverse direction. The USA and Europe are, despite all the gloomy predictions of the decline of the West, the two largest and most closely interconnected economic areas. Then there are the historical, cultural and personal interconnections, denser than with any other region of the world. Yes, the dynamism of Asia and parts of Central and South America is impressive. The rise of China and other new powers is happening at breathtaking speed. Yet the development differential between these countries compared with our developed economies is still enormous. We are strong. And, if we are smart, together we will still be strong in 30 or 40 years time. I am not one of those who talk in culturally pessimistic undertones about “the West and the rest”. It is not my style to indulge in decline and fall scenarios. The history of the West has always been the history of an open system with the capacity to learn, a history of crises, upheavals and the ability to begin again. There is nothing to suggest that this history is about to end.

In recent years the old continent of Europe has been hitting the headlines mainly with bad news. I know how impatient and irritated people here in Washington were about European crisis management. Indeed, there is much to criticize. Often we Social Democrats too might have wished for faster and more courageous action on the part of the German Government. But whatever particular criticisms we may have had, we gave our support to the key bailout measures and we ultimately voted in Parliament with the Government. Because we knew that with the various rescue packages, it would have been irresponsible to look only for a short-term political capital out of the situation. This was, after all, a matter of the basic strategic orientation of German policy, and responsible action was needed. A sort of German bipartisanship!

European integration was our answer to centuries of bloody conflict and civil wars. It has brought our continent more than 60 years of peace and prosperity. It has made possible the reunification of our country and our continent. One does not risk such a project lightly!

To help you understand better what is going on in Europe at the moment, I invite you to look back beyond the recent past. Since the beginning of the Nineties European integration has made giant strides. And it was economic integration that set the pace. Twenty years ago in 1993 the single market was created, eighteen years ago in 1995 border controls were scrapped in large parts of the EU. Twelve years ago, on 1 January 2002, the euro was introduced. But there was still no common economic policy as Member States insisted on their right to retain sovereignty over setting their own taxes and budgets. Many economists were rightly critical of this. But at that time, in the Eighties and Nineties, we went as far politically as we could. Politics operates not in the realm of the desirable but rather of the possible.

The internal market and the euro developed their own dynamism. In 2003 Germany, under Social Democratic leadership, brought in welfare and labor market reforms and improved the country’s competitiveness. We turned from being the sick man of Europe to the continent’s power house.  The foundations for our present strength were laid ten years ago! Other countries such as Italy, Spain and Greece, experienced a euro bonanza, benefitting from low interest rates, and ran up debts.  But by 2010 at the latest it had become clear that things could not go on that way, that if they were to function properly, a single currency and an internal market also needed stronger economic policy coordination – with stricter rules on prudent housekeeping, but also with new instruments of solidarity. And it is precisely these rules on solidity and solidarity that are being argued over at this time.  This is a complicated process which needs time. When I look at politics here in the USA too, however, I can say what you know only too well, that political progress often proceeds at snail’s pace. You have your fiscal cliff. Our cliffs are perhaps not so high but they exist in 27 capital cities and each of these cliffs has to be conquered.

In Germany it is common to hear people complaining that too much is expected of Germany in terms of aid and solidarity. The Federal Government itself tends to take the same line. Of course it is true that Germany’s resources, too, are limited and its possibilities finite. You here in Washington know what it is like when the whole world comes knocking at your door with huge expectations and you look anxiously at the red figures in your budget. Yet when I speak in public, rather than joining in with the litany of complaints, I try instead to point out a few simple truths. The most important truth is that Germany has been the greatest beneficiary of the European single market, and that continues to be the case right up to the present day and increasingly so!  According to IMF forecasts German GDP will rise by 10% per head of population between 2007 and 2016; in France GDP is stagnant, in Italy it is set to fall by 9% and in Spain by 6%.

It is true that we have diversified our exports in recent years. But more than 50% of our exports still go to our European neighborhood. And for this reason alone we cannot afford to be indifferent to what happens there! We will soon know what is happening from our wallets if a mood of hopelessness is allowed to grip countries like Italy, Spain and Portugal, if political instability sets in and if there is a threat of years of stagnation.

I should also add, by the way, that even now we are among the winners in the crisis! Last year Germany registered net inward migration of 400,000 people. Most of this number came not from Turkey or North Africa but from neighboring European countries. Young Spaniards, Portuguese and Greeks are learning German in large numbers and coming to us – well educated, motivated people who see no future any longer in their home countries. We are at the moment experiencing something like the beginning of a true European labor market. People are moving to where there is work, and that means they are coming to us. In doing so they are cushioning us from the impact of demographic change which is just beginning to be felt on the German labor market. This is not yet a big topic and the trend is still quite new. But naturally Spain, Portugal and others will only accept this development, which makes good economic sense, if there is also some kind of quid pro quo. Where regions and countries experience very different economic development, there has to be a transfer of prosperity. This applies within a country but it also applies within a common economic area. If we cannot manage to act in a spirit of solidarity, the economic imbalance will grow – until a point at which it can no longer be managed, even politically.
 
I don’t want to go into any more detail at this point. European politics is a difficult subject. My brief canter through recent European history was intended to highlight one thing in particular: firstly, what is happening on our continent is exciting. Secondly it is important to take a long view. Whether or not in the end we arrive at something like the “United States of Europe” is academic. For me it is enough to know what will happen over the next ten or twenty years. And here I am quite certain: the European train will continue to run. And the direction in which it travels will be towards a more closely integrated Europe and one which is based on greater solidarity. My plea to you is: please ensure that the USA retains its traditionally friendly stance to Europe. Support for European integration has been a fundamental constant of American policy on Europe since Truman and Marshall. We Germans, all Europeans and also the USA have an interest in the success of this great peacekeeping and civilizing project!

What does this mean for transatlantic relations? First of all I would like to put it to you that despite all the talk of a widening Atlantic rift, the basic trend as far as our societies are concerned is towards convergence. Whatever our differences, the Atlantic is not growing any wider! Rather our societies are growing closer together. To give one example: there are over 10 million people living in Germany today who came to Germany after they were born. That is around 12% of the population and is exactly the same as the percentage of foreign-born people in the USA. What do I want to say by that? We are simply becoming more American, even if most people do not recognize it. Germany today, like the USA, is a country of immigration. That creates problems, but nothing we cannot cope with politically. It may be a difficult truth for the Conservatives to swallow, but sealing ourselves off is not an alternative! Our social peace and future prosperity depend on whether we accept the fact of immigration and make integration one of our top issues which we have to deals with politically.

The problems which confront us politically in the coming years in Europe and America also bring us closer together rather than dividing us. Since the collapse of Lehman Brothers we all are grappling with the question of how to control a financial sector which has got dangerously out of hand and how to redefine its relationship with the real economy. When it comes to regulating the financial markets, Europeans and Americans will not always take exactly the same path. But in view of the interconnectedness of the European and American financial worlds, it is very much in our common interest to ensure that the rules we set ourselves, if not identical, are at least convergent and compatible.

The same applies to the question of a sustainable and resource-efficient growth model. I am not one of those for whom growth has negative connotations. Our societies need growth, including industrial growth.  But take climate protection – simply carrying on with the old growth model will take our planet to the brink of catastrophe. I know of course that your discussion on energy policy is very different from ours, particularly in light of the shale gas revolution. But that does nothing to alter the simple truth that the survival of humanity depends on whether we are able to switch to a new, sustainable growth path. And this is not about highly philosophical discussions. This is about quite practical questions, about a large number of small but, in their totality, decisive steps. We need new materials, new product designs, new drive and storage systems. This is where not only policy-makers but also our researchers and engineers need to step up to the plate. There are nearly 1.5 million people in both Europe and the USA working in research and development. That represents huge potential. It is up to us whether the human spirit of invention succeeds in reconciling progress and growth with the conservation of life’s vital resources. What a task. And what a huge triumph for us all if we succeed!

I welcome the fact that the discussion on establishing a transatlantic free trade zone is gaining momentum once more and that President Obama has yesterday announced to support and to reenergize this project. Whatever the difficulties to be overcome in particular areas, this project has huge potential for creating growth. I believe that it is important, precisely because the Doha round negotiations have reached a dead end, that the USA and Europe should send out a signal in favor of free trade and back it up with action. The dismantling of non-tariff barriers to trade is almost more important than the abolition of customs duties, which are in any case already quite low.  We are a common economic area which is still responsible for half the world’s GDP. If we agree on common standards and licensing procedures, particularly in the sensitive areas of environmental protection and product safety, this will send out a signal for corresponding agreements with Latin America, the Asian countries and the rest of the world.

In his speech in Munich Joe Biden said: “We are going to be both: A Pacific, but even so an Atlantic power.” When I heard this, I had a half joking but half serious response on the tip of my tongue, which I will share with you today: “And we are going to be both too: Europe is an Atlantic power. But above all: It is a small peninsula of Asia.” The world is round and the routes to the new centers of growth in the global economy do not lead only across the Pacific or, in our case, through the Suez Canal. I strongly advocate that European policy should have a stronger focus on Asia and the Pacific. And I am not thinking here in the first instance of classical security policy. I believe that beyond business relations, Europe would be well advised to do more on the diplomatic front to fly the flag. Whether it is the situation on the Korean peninsula – who other than us Germans really has any experience of decades of partition and reunification? – or the conflicting territorial claims disputes between Japan, South Korea and China and the countries bordering the South China Sea– the voice of Europe certainly carries weight in the region. I at any rate would plead for us to be more proactive here in future, not forcing ourselves on anyone but offering our experience of peaceful conflict resolution on a continent which was once the world’s most warlike.

The same applies to Central and Northern Asia. During my time as German Foreign Minister I was already working on the development of a Central Asia strategy for the EU. This was making quite good progress at the time, but in recent years unfortunately there has been little movement because of a lack of interest and commitment. Our Russia policy too had and has an Asian dimension. Russia, after all, is the largest Eurasian power. Even under the Tsars Russia saw itself as a bridge from Europe to Asia and the Pacific. There is much to suggest that this bridging function will become even more important in the future. As China’s hinterland develops, there will be very new economic prospects for North and Central Asia. Countries such as Mongolia are suddenly becoming interesting. We are witnessing the development of new transport routes. The talk of a new Silk Road is merely a symbolic expression of this. President Putin recently raised the subject of reviving the Northeast Passage, much used during Soviet times. It is too soon to say when such a project will pay off. But one thing is clear:  the Asian continent is being re-surveyed – politically, in terms of infrastructure and economically. We are on the verge of a major geopolitical upheaval. And we Europeans, but the USA too, have a fundamental interest in ensuring we are not simply passive bystanders.

I know that our calls for dialogue with Russia tend to raise eyebrows in the USA. But even in times that were more difficult than they are today, I used to say to American discussion partners: it is in our fundamental interest in the West not to break the threads of communication and cooperation with Russia. Especially in Germany – whether we like it or not, Russia stays an important neighbor which we cannot ignore. And in addition to that, I believe that Russia needs our cooperation to open up and develop its vast country, to build civil society and to develop the rule of law. How to create a strong and stable “Mittelstand”, an economic middle class – that was one the questions I had to answer on a panel in Moscow last December. But whatever difficulties we may have with the current Russian leadership, which I do not seek to play down. We need patience, strategic vision and an understanding of our long-term interests.

There is still much more ground that I would have liked to cover: Afghanistan, Europe’s role in the Middle East and North Africa, the need for Europe to take on more responsibility in this our neighboring region. But I would like to stop here for now. Thirty minutes is not enough time to go through all the conflicts in this world. What I have tried to do is to make clear to you a position. And this is a position of strategic courage and informed confidence, the only way we will be able to hold our own in the future.

We watch as before our eyes a new world is being created. And we should do everything we can to shape and influence this development in line with our values. That is in our interest. But there is even more at stake.

Europe and America stand for democracy and liberty, for an open society based on the principle of solidarity, for equality of opportunity and for the right to the pursuit of happiness. These are the values of the West. But these are also the values without which there can be no better and more peaceful world. It is my conviction: our shared history, the history of the West is far from over. On the contrary - we are now embarking on a new chapter!