It's Time for Free Trade With Europe

President Barack Obama should work with the EU to create a transatlantic market that will strengthen the U.S. relationship with Europe.

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Frances G. Burwell is the vice president and director of Transatlantic Relations Program at Atlantic Council.

If President Barack Obama had run for re-election in Europe, he would have been overwhelmingly re-elected—in seven major countries, fewer than 10 percent would have voted for Mitt Romney. In Germany, 93 percent would have voted for Barack Obama—roughly the same percentage of African-Americans who voted for the president. Yet, many Europeans have expressed concerns about President Obama's foreign policy and particularly his lack of attention to Europe. At a conference in Europe this weekend, leading foreign policy analysts and politicians expressed dismay—but not surprise—that the president's first post-election foreign trip would be to Asia. 

Why then is Barack Obama so popular in Europe? First, his policies: In a continent where universal healthcare is the norm, and where even the eurozone crisis has failed to dent the assumption that the state should provide an adequate safety net, the president is seen as far more compatible with European political values than most other American politicians. Even so, approval of Barack Obama's international policies has waned in Europe, going from 78 percent in 2009 to 63 percent in 2012.

[See a collection of political cartoons on the European debt crisis.]

Obama is also popular because he seems to represent, for many Europeans, what they see as the best of America. He is young, energetic, and articulate; much like the John Kennedy who was so popular with an earlier generation of Europeans. When first elected in 2008, Barack Obama seemed so different from George W. Bush, who had divided Europe over the Iraq war, and never been popular because of his stance on issues from climate change to the death penalty. Finally, the multiracial Barack Obama was a symbol of a more equitable society.     

But if Europeans admire the president, they know they must work to get his attention. In the first term, they gamely sent more troops to Afghanistan, responding to the Obama administration's "surge" that sought to get on top of the situation in that country. The Afghan war was never popular in Europe, and most politicians and publics accepted that they were there, not because it was in their interest (although it was), but because the United States had asked them. Now, as Afghanistan is winding down, Europeans are looking for new ways to partner with the United States. Despite the brief Libyan operation, another military mission seems unlikely. The eurozone crisis has led to steep cuts in European defense budgets, and the wars in Iraq and Afghanistan have left some European publics unwilling to engage militarily just to be an American partner. 

[Read the U.S. News Debate: Who Is Handling Its Debt Crisis Better: United States or Europe?]

Instead, European leaders have turned to economics as the basis of a renewed partnership with the United States—a choice that might seem futile given the state of the eurozone and the U.S. mountains of debt and deficit. Nevertheless, several European leaders—including German Chancellor Angela Merkel and U.K. Prime Minister David Cameron—have proposed creating a single transatlantic market by reducing barriers to trade and investment across the Atlantic. This idea makes a great deal of sense. The United States and Europe remain each other's largest economic partner, with their daily trade of $3.6 billion, making this the largest commercial relationship in the world. The amount of investment currently held by the EU in the United States and vice versa totals about $3 trillion, contributing to the creation of 14 million jobs on both sides of the Atlantic. Perhaps most important in these trying economic times, removing at least most of the remaining barriers to trade across the Atlantic could lead to .3 to .7 percent growth in GDP per year; not a small number considering today's anemic growth rates, and something that U.S. and European leaders—and their economically strained publics—would dearly appreciate.

Negotiating such a pact will not be easy. The details will be enormously complicated and some businesses must give up protections that they have long enjoyed. But such an agreement would reduce costs for most businesses and consumers in the huge transatlantic market. Cars made in the United States would be cheaper to export to Europe and vice versa. Consumers would pay for only one safety test on electrical goods because U.S. and European governments would recognize the validity of tests done by the other. Large transatlantic companies would no longer pay duties on goods shipped between U.S. and European facilities and so might have more funds available for investment. Unlike other U.S. trade pacts, our workers and firms would be competing with a region with labor and environmental standards that are at least the equal of our own, if not even tougher. 

[Read the U.S. News Debate: Should Greece Leave the Eurozone?]

European leaders have called on President Obama to launch negotiations to reduce barriers to transatlantic trade and investment. Even as he gets on the plane to Asia, he should remember the strength of the United States-EU market, despite the eurozone crisis. His immediate priority in the second term must be the creation of economic growth and jobs. For this "Pacific president," creating a stronger economic partnership with Europe is the best way to build a stronger American economy.

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