Role Reversal: Geo-economic America and Geopolitical Germany

Role Reversal: Geo-economic America and Geopolitical Germany

On December 27, 2016, the Frankfurter Allgemeine Zeitung published an op-ed by Transatlantic Academy Executive Director Stephen Szabo entitled "Amerika zieht sich zurück, Deutschland wird Anker" on its website. Below is an English-language version of the piece; the FAZ version can be read here.

In recent decades, Germany has had a global image as an economic power and the United States has dominated the world as its greatest geostrategic power. With the nomination of Rex Tillerson, the CEO of Exxon Mobil, as Secretary of State along with a number of other private sector people to the Trump cabinet, the United States is now, along with China, the world’s greatest geo-economic power. At the same time, Germany has become more of a geopolitical power as it has sacrificed economic interests to broader security concerns in dealing with Russian aggression in Ukraine.

What is a geo-economic power? It is one which tends to define its interests primarily in economic terms, giving priority to economic over non-economic interests and values. It cedes a good portion of agenda-setting to the private sector, especially to exporters and uses economic power to impose national preferences on others. It follows a philosophy of commercial realism rather than more traditional forms of geopolitical realism and gives a preference to economic over military instruments of statecraft. The Trump Administration is clearly one in which economically driven deal making will be given priority over the more traditional security dominated agenda of American foreign policy. The incoming President has made it very clear that he subordinates security interests to economic ones and trusts the private sector far more than the national security establishment in the setting of American foreign policy priorities.

Nowhere is this clearer than in the Russia policy area. Trump has not only ignored but denigrated the findings of the American intelligence community regarding Russia’s intrusions into the American electoral process. Like his predecessor Barack Obama, the future president believes the American foreign policy establishment is too ready to use military force. He is equally critical of the “free rider” mentality of European allies who have lived in peace and security for decades at the cost of American military expenditures. While the national security community sees Russia as a threat, the business community sees it as an opportunity. This emphasis on opportunities for economic growth is in accord with Trump, who once authored a book entitled The Art of the Deal. The prospect of a great deal counts for more than traditional security concerns or human rights. Why not agree to a sphere of influence deal with Russia? Why not risk a diplomatic confrontation with China in return for greater economic leverage?

For many years Germany’s Russia policy was dominated by such economic priorities. Russia’s aggressive use of military power caused German leaders to rethink this approach and to subordinate the interests of its business community to the larger strategic threats to the European security order. This shift in the American approach poses great challenges to German policy. Germany has relied on American military power as a backup to its more civilian power approach. The German-led Minsk agreement was based in part on the fact the Putin had to calculate that an American military response like arming Ukraine was an option if the negotiations failed. Under the leadership of Chancellor Angela Merkel, Germany already followed a geopolitical approach in creating a sanctions regime on Russia. She could argue that the future of the Western liberal order was being threatened by Russian actions in Europe, including its intensive hybrid warfare in Germany.

For quite a while Germans have been critical of the easy resort to force of American presidents. They now find themselves in an alternate universe where Germany and Europe are holding the line against the Putin offensive while the American President is preparing to undercut their strategy. The downplaying of value differences in favour of deal making has already weakened belief in the liberal order. Trump and his key advisors believe that the United States and Russia are on the same side in the struggle against Islamic terrorism and in defending traditional values. Trump has congratulated the supporters of Brexit and populists in Europe and the alt-right Breitbart network (long led by Trump advisor Steve Bannon) is expanding to Europe. This is a new form of American democracy promotion which supports illiberal democracies.

In many respects the United States is well advised to move toward a more geo-economic approach as it has paid a heavy price for its catastrophic use of military force in the past decade and a half. It is now a war weary, over extended and divided country which badly needs to focus on economic reconstruction at home. As it does so, however, it will no longer be the “indispensable” nation which has anchored the open systems of the West, placing a much greater burden on Germany and Europe. Every crisis is an opportunity and Germany and Europe may use this one to revitalize the European Project and become the new bastion for the West. However, it is also possible that the West is now dying.