A U.S.-Europe watershed

Relations between the United States and Europe are set to change in the context of an expanded and assertive European Union.

RELATIONS between Europe and the United States are at a critical point. The post-Second World War global settlement is no longer anchored in contemporary economic and political realities. The Soviet empire has collapsed. Emerging from the ashes, Russia is barely more than a Third World country with nuclear weapons. In Asia, Japan's new post-War generation of politicians increasingly demand that Japan become a normal country; China emerges from the shadow of the USSR, set to become the East's counterweight to the U.S. Politically, the Bush presidency represents a position ideologically at odds with Europe's predominant centre-left governments and, if his campaign rhetoric is to be believed - not always true of politicians - it will be a foreign policy stance devoted strictly to U.S. interests.

But what many Americans fail to realise is that in the West another new superpower is in the process of being born. Already, without the next phase of enlargement, the European Union (E.U.) is bigger and wealthier than the U.S.; the largest international aid donor in the world; on the verge of introducing a new single currency, the euro, that threatens to challenge the dollar's monopoly in the international currency markets.

This process has been driven not by politicians, whether it be Jacques Delors or Romano Prodi, but by the slow drip of thousands of decisions taken by businessmen and women, entrepreneurs and industrialists. They have, in the drive to compete in an increasingly global marketplace, in an inchoate manner, satisfied the need for the creation of a large domestic market redoubt as an underpinning strategic base. The European Industrial Union is the consequence of that process. The politicians with their 'single market' measures are merely greasing the wheels of a bandwagon that is already rolling. Owing to Europe's Social and Christian Democrat traditions that has been married to a social union, the cutting edge of Darwinian competition has been blunted by regulations designed to protect community from capital, red in tooth and claw.

More inexorable has been the growing economic and monetary union where common industries, intergrown across member state boundaries in a manner that would make it impossible to tear them asunder ever, have imposed the need for common economic management and the answer of a common currency. With industrial and economic interests shared, differing foreign and security policies have little logic in the E.U. Hence, there is a growing coordination in the matter of common foreign and security policy among E.U. member states.

First, this means that as European political self-confidence grows they will want to have distinct European positions and ones that have a global reach. This will mean that Europe will no longer play its traditional subordinate role. In order to arrive at common positions dialogue rather than dictation will be required.

Already this growing independence can be seen as the E.U. presses ahead with the building of diplomatic and aid links with North Korea, encouraged by South Korean President Kim Dae Jung. While the U.S. seems to see isolated North Korea as an excuse for pursuing the National Missile Defence (NMD) programme, Europe tries to remove the threat by critical engagement in a part of the globe that until now was entirely in the U.S.' sphere of influence.

Second, at the trade level there are a series of disputes reflecting Europe's wish to temper free trade with social concerns. The banana regime reflects Europe's feeling of responsibility for its colonial past when it imposed monocrop agriculture on some of its Caribbean islands; the dispute over 'hushkits' on noisy aircraft reflect public environmental concerns; and the row over bovine growth hormones shows a concern about food safety that is unsurprising after Europe's experience with BSE, or the mad cow disease, and the foot and mouth disease. The recent decision taken by the European Parliament to ban the sale in five years of cosmetics tested on animals was the response to the enormous public campaign on animal welfare issues. However, it will almost certainly trigger a new trade row.

Thirdly, Europe is increasingly looking to its own defence. The 60,000-strong European rapid reaction force is inspired by the failure of the U.S. to modify its Kosovo intervention to take into account its European North Atlantic Treaty Organisation (NATO) allies' concerns. It is also encouraged by the prospect of Europe without Americans. A minority view the prospect with joy, the majority with a degree of sadness, all see it as a prospect that has to be faced. Were there in a decade to be a new Kosovo, Europe has to have the option of going it alone. The U.S. wants Europe to pay without a say. It may have worked in the past. It will not work any more.

Europe wants a partnership with the U.S. Everybody would benefit from such a partnership but the difficulty will be managing the transition among policy-makers on both sides schooled by half a century of history. The world will be watching as we try to manoeuvre the American elephant out of the European boat without letting it capsize.

Glyn Ford is a member of the European Parliament from the United Kingdom.