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The Unintentional Hilarity of Transatlantic Discourse
Anatomy of a Politico story that contains two levels of humor
The beginning of the World Economic Forum’s annual meeting in Davos is also the beginning of the orgy of foreign policy discourse about Davos. I have already served my time on the “commenting on commenting on Davos” beat and have no wish to go back to that well. That said, sometimes an article comes along that is just way too amusing to ignore.
I give to you, dear readers, Alex Ward and Suzanne Lynch’s Politico story from Monday: “US lawmakers in Davos tell Europeans: America’s not protectionist.” Let’s look at the lede!
As snow pounds the Swiss mountain town of Davos, American lawmakers are huddled in warm, quiet rooms trying to assuage European concerns that the United States hasn’t just turned into a protectionist power.
The passage of Washington's Inflation Reduction Act (IRA), the $369 billion behemoth legislation stuffed with clean-energy incentives, has upended EU-U.S. relations, prompting European accusations that the U.S. is unfairly boosting its own companies to encourage local investment.
Why yes, quite a few of us have pointed out that for all of the proclamations that “America is back!” it sure seems as though U.S. foreign economic policy says otherwise. This has been a square that the Biden administration has tried to circle with the Europeans for the two years it has been in office and never quite succeeding.
So far, a perfectly straightforward story — peppered with typical Davos flourishes regarding snow and cozy fires and whatnot — about an ongoing policy conundrum. I started to laugh, however, when Ward and Lynch got to the quotes from members of Congress. Here I give you Senator Joe Manchin:
The mix of U.S. senators and House members say Europe has it all wrong. The U.S., they told POLITICO in multiple exclusive interviews on the sidelines of the elite gathering, is simply investing in its own energy and economic security. And a stronger America means a stronger ally, they argued.
Senator Joe Manchin, the centrist Democrat from West Virginia who was instrumental in passing the IRA, said Europe is being “hyper hypocritical” after decades of European protectionism.
Manchin continued that, on a separate occasion, he told French President Emmanuel Macron the IRA couldn’t possibly hurt Europe, despite the concerns.
“That bill was designed to basically strengthen the United States so that we can help our allies and friends, which need it right now," Manchin said. "And if anybody needs it, the EU needs it. And without that, we're not going to be and maintain the superpower status of the world if we're not energy independent."
The story also has U.S. Representative Greg Meeks telling Europeans that “‘there’s no perfect bill,’ and that it's ‘extremely important’ to secure America’s supply chain for critical semiconductors and to combat climate change.”
This is all amusing because, no matter what Manchin, Meeks, or anyone in the Biden administration is saying, of course the IRA is protectionist and of course it does not really help Europe. The IRA offers massive subsidies to North American producers of electric vehicles and discriminates against European producers. Only a last-minute fix prevented the bill from discriminating against Canada and Mexico. I have no doubt that Europeans would prefer a strong U.S. to a weak U.S., but not at the expense of zero-sum policies that hurt European producers. Telling Europeans that a strong America is good for Europe overlooks the rather obvious point that a weaker European economy is bad for Europe.
Is U.S. protectionist right now? Pretty much! Brad DeLong told the Financial Times last fall that, “The US is now an anti-globalization outlier.” As Sebastian Mallaby noted earlier this month in the Washington Post, “The Biden team… is led by policymakers who interpret Hillary Clinton’s 2016 defeat as a repudiation of globalization by swing-state voters. Following this logic, the administration has done the opposite of offering allies additional U.S. market access.”
Furthermore, the complaints from overseas about the Inflation Reduction Act are not abating. The Washington Post’s Olivier Knox noted yesterday that he, “has warned about these rising tensions on several occasions over the past year. They’re making headlines overseas but have gone largely unnoticed by the general public in the United States.” So the idea that members of Congress will be able to say that these protectionist measures are not protectionist as both adorable and laughable.
That is the most obvious source of hilarity in the Politico story. But Ward and Lynch also fall prey to a trope that afflicts so much transatlantic coverage: exaggerating the swings in the relationship. They write:
After something of a golden era of EU-U.S. cooperation following Russia’s invasion of Ukraine — the two sides worked constructively together to devise complex sanctions packages against Moscow — Europe was caught off guard by America’s subsidy-heavy legislation…
This week in Davos could be an opportunity for two of the world’s biggest trading blocs — the EU and the United States — to try and iron out their differences. But with little room for compromise, the Atlantic Ocean between the two seems as wide as ever.
That is a lot of whiplash to put into one story. From “a golden era” to “as wide as ever” inside of a year?! That seems overwrought… and I suspect more articles will be written in that tone for the rest of Davos.
The truth about the transatlantic relationship is that it is never as warm and fuzzy as is seems during the good times and it is never as perilous and fragile as it seems during the rough patches. The current moment in the transatlantic relationship is defined by two simple facts:
The United States needs Europe as a vital ally to have any chance to cope with Russia and China at the same time; and
While Europe is less than thrilled with U.S. trade protectionism, Russian bellicosity on the continent is the much bigger and more immediate concern.
In other words, please feel free to ignore any hyperbole about the fraught transatlantic relationship over the next week.