B|Brief: The Triumph of Transactionalism: ‘America First’ and Europe’s New Strategic Reality

February 7, 2017

by Jeffrey Brown

Delivering his inaugural address from the steps of the U.S. Capitol last month, a newly minted President Donald Trump proclaimed that his administration would be guided by a simple philosophy: “America First.” While the concrete policy implications of this new ethos remain vague, it is clear that Trump intends to pursue a foreign policy grounded in zero-sum thinking, bilateral deal-making and transactionalism that contrasts sharply with the respect for tradition and grand strategy that has to date defined the trans-Atlantic relationship.

In the coming months, Trump’s wholesale rejection of grand strategy will put immense pressure on Europe to articulate its own game plan. However, riven by internal divisions and with dramatic change looming on the trans-Atlantic horizon, Europe’s new strategic reality will surely lead to the redefinition of internal power structures and alliances. As the European Union’s leaders, member states and citizens peer into the black box of strategic uncertainty, it is now time to assess the fault lines along which new alliances may develop, and where old alliances may be reshuffled.

Franco-German Relations: Forever the Ballast Keeping the Ship Afloat?

Following the U.K. vote to leave the EU, Franco-German cooperation — the engine of integration since the creation of the European Coal and Steel Community in 1951 — has been touted as an antidote to Trump’s transactionalist doctrine and the internal and external shocks roiling the EU. However, despite strong cooperation between President Francois Hollande and Chancellor Angela Merkel during the Ukraine crisis, the alliance may be unable to once again inject the calming dose of strategic clarity that has historically preserved European unity.

In France, a charged presidential campaign has elevated Marine Le Pen, Emmanuelle Macron and Francois Fillon as frontrunners whose positions differ sharply from those of Merkel and her ruling CDU-SPD coalition. For example, both Macron and Fillon have suggested that EU sanctions imposed on Russia be lifted in July 2017, while Le Pen has called for an “alliance between the U.S., France and Russia,” a quintessentially Gaullist proposition that sidesteps Germany. Two of the leading presidential candidates have also staked out hardline positions on borders and refugees that are in direct opposition to those of Merkel, with Fillon calling for a halt to refugee admissions and the restoration of border controls and Le Pen threatening to “renegotiate with the EU to bring back sovereignty to France.” In contrast, Macron has praised the “collective dignity” of Merkel’s refugee policy while arguing for a more pragmatic response that involves cutting deals with origin countries in the Middle East and North Africa. Although the positions of second-tier candidates Benoit Hamon and Jean-Luc Melenchon hem more closely to those of Merkel and her ruling coalition, they are unlikely to advance to the second round of voting on May 7.

In Germany, the battle between Merkel’s CDU and Martin Schulz’s SPD will sharpen in advance of elections on September 24, sapping the country’s ability to drive a unified Franco-German strategy aimed at offsetting Trump’s transactionalism. Although Merkel has reiterated her support for continued sanctions against Russia, her pledge could be hampered by Trump’s suggested rapprochement with Moscow. Such a shift could embolden the SPD to force an end to EU sanctions on Russia, thereby undermining implementation of the Minsk II accord and imperiling Germany’s eastern-directed neighborhood policy. Although the biggest losers would be states in Central and Eastern Europe such as Ukraine and Poland, and the Baltic states, a dramatic improvement in US-Russia ties could ultimately bolster the role of France and Germany as the guarantors of European unity — if they can forge a common Russia policy.

While key policy divergences between France and Germany will not be resolved until after German elections in September, the Trump administration is unlikely to delay the deployment of its transactional foreign policy. Early rhetorical broadsides against Germany’s refugee policy and the country’s maintenance of a “grossly undervalued” euro may be aimed at driving a wedge between Germany and other EU member states (notably France), thereby laying the groundwork for bilateral deal-making with member states following the autumn elections.

The Biggest Losers

While Trump’s transactional foreign policy will have an oversize effect on Germany and France due to their sheer size and prominent role in ongoing political turmoil, it is also likely to ripple through the European continent. Tellingly, the biggest casualty from Trump’s transactionalism will be the very multilateral institutions upon which the United States has based its Euro-Atlantic policy since 1945. In questioning the utility of NATO and demanding that members cough up “what they’re supposed to,” Trump has turned the defense of long-standing U.S. allies into a game of "pay to play." Questioning security commitments could lead to a shift of ownership for NATO away from the United States and toward stalwart members such as the U.K., Poland, and the Baltic states.

Beyond multilateral institutions, Trump’s transactionalism is unlikely to benefit a host of smaller states that have traditionally relied on long-term U.S. economic and security guarantees. Adopting a transactional calculation, Trump may view relatively weak states such as Ukraine, Georgia, Kosovo and Bosnia as purely European liabilities, forcing them to pursue inventive strategies to elicit his administration’s attention. While these states will be forced into asymmetrical bilateral negotiations with the United States, they may also have more latitude to define their ‘worth’ and reach agreements as they remain outside the EU.

Conclusion: Transactionalism and Strategic Realignment

In these early days of Trump’s term in office, it is clear that Europe’s internal discord poses a serious challenge to its ability to counter transactionalism. European decision makers should recognize that in addition to marking a departure from long-standing U.S. commitments, transactionalism signals a shift toward the creation and subsequent exploitation of power asymmetries that favor Washington at the expense of smaller European partners. As France and Germany grapple with internal divisions and a rapidly evolving strategic environment, they will face the incredibly difficult task of forging a coherent path ahead for Europe. Although specifics on how transactionalism will be applied remain vague, it is clear that a new strategy is afoot that will precipitate realignment and, perhaps, the redefinition of the EU itself.


Jeffrey Brown is project manager of international relations at the Washington, DC-based Bertelsmann Foundation. Jeffrey.Brown@bfna.org