House of Commons - Government foreign policy towards the United States

Government foreign policy towards the United States - Foreign Affairs Committee Contents

4 Strategic issues

40. Witnesses and interlocutors identified a number of what Sir Nigel Sheinwald called "headwinds" for the UK-US relationship. We heard that the UK's value to—and thus potential influence over—the US might decline as a result of some of these.[143] These potential difficulties or vulnerabilities in the UK-US relationship included:

· the waning benefit accruing to the relationship, and in particular to the UK's standing in the US, from the shared military mission in Afghanistan that has been underway since 2001, as international combat operations there conclude by the end of 2014. In October 2013, Professor Chalmers told us that "psychologically, people are almost in late 2014 already";[144]

· the lack in the UK and US of a model for effective intervention in third countries facing humanitarian catastrophe or representing a security threat, following the ground-troops-based military interventions in Iraq and Afghanistan since 2001, and the air campaign against the Gaddafi regime in Libya in 2011;[145]

· what Sir Nigel called the UK's "debate on identity", encompassing the questions of the UK's membership of the EU, and possible Scottish independence;[146]

· the potential for UK defence cuts to lessen the UK's value to the US as a military partner;[147]

· the risk that the UK will become less valuable to the US as the latter focuses increasingly on Asia;[148] and

· the waning strength of the UK-US historical, family, cultural and linguistic ties that have traditionally underpinned the relationship, as a result of demographic changes on both sides of the Atlantic—with Asian and often Spanish-speaking Latin American communities gaining economic and political weight in the US, and some South Asian communities which are less prominent in the US becoming increasingly important in the UK.[149]

As we indicated in our Introduction, several of these issues are also being considered by other Parliamentary committees. We have ourselves considered the foreign policy implications for the rump UK (RUK) of Scotland becoming an independent country, in a Report we published in 2013. We concluded in that Report that Scottish independence would inflict a degree of international reputational damage on the RUK, and that any nuclear disarmament of the RUK which might result from Scottish independence "would be received badly by the UK's key allies", such as the US.[150] As our contribution to the debate here, we comment below on the US 'pivot to Asia' and two Transatlantic issues.

US 'pivot' to Asia

41. In its March 2010 Report, our predecessor Committee already noted that President Obama had identified himself as the United States' "first Pacific President" and that there was a prospect of the US shifting its foreign and security policy focus increasingly towards Asia.[151] In autumn 2011, the first Obama Administration announced through a series of speeches and articles by senior Administration figures what it initially called a 'pivot' to Asia.[152] The shift in US priorities was confirmed in the January 2012 Defense Department Defense Strategic Guidance. In terms of specific actions, the 'pivot' comprises an increased US military presence in Asia-Pacific; US accession to the East Asia Summit;[153] and the proposed conclusion of the Trans-Pacific Partnership (TPP), a free trade agreement on which 12 regional states (not including China) were negotiating as we conducted our inquiry.[154] The US 'pivot' is typically seen to be a US response to the rise of China, to a significant extent, as well as to the scale of prospective economic growth in Asia. The use of the word 'pivot' prompted some US allies to express concerns—in Europe, that the US was 'decoupling' from the continent; and among US allies in Asia, that a 'pivot' could be only a temporary, easily-reversed step, rather than a firm security commitment.[155] For the term 'pivot', US policy-makers swiftly substituted 'rebalancing'.

42. Witnesses were sceptical that the US 'pivot' would involve as large a shift in US foreign and security policy as has sometimes been assumed:

· Several witnesses argued that the US had been heavily engaged in Asia since the end of World War II, and that there was therefore little novel about the 'pivot' now. More specifically, Dr Boys argued that former US President Bill Clinton had attempted a similar shift of focus to Asia but had been pulled back to a more traditional focus on Europe and the Middle East, by the pressure of events in those regions, and by the unrewarding environment—at least in a relatively short timeframe—for US policy initiatives in Asia. He argued that President Obama's initiative was likely to follow the same pattern—and, indeed, that a more traditional US foreign policy focus on Europe and the Middle East was already evident under the second Obama Administration, under John Kerry as Secretary of State rather than Hillary Clinton.[156]

· Dr Tim Oliver, Fritz Thyssen TAPIR Post-Doctoral Fellow at the Center for Transatlantic Relations, Johns Hopkins University School of Advanced International Studies, said: "Despite talk of an 'Asian pivot', Europe—and increasingly the EU—remains crucial to US economic, security and political interests".[157] More specifically, Xenia Dormandy said that the US would continue to keep significant military forces in Europe, and both she and Professor Chalmers said that Europe remained of key strategic value to the US as a basing and staging location for military deployments and operations elsewhere.[158] Sir Nigel Sheinwald said that, in his understanding, the US 'pivot' had arisen primarily from the opportunity afforded by the end of US combat operations in Iraq and Afghanistan, and had little to do with US policy towards Europe.[159]

· Lord Howell was sceptical that any state could now prioritise one region over any other in its foreign policy, given the degree of interdependence that he saw as integral to what he identified as a "networked world". In particular, he argued that US security continued to be heavily tied to the Middle East.[160]

For its part, the FCO said that the US 'pivot' did not entail any lessening of US engagement with Europe or the Middle East.[161] On our own visit to Washington in autumn 2013, we gained little sense that the Asia 'rebalance' meant that US policy-makers were disengaging from other parts of the world—the Middle East, above all. Rather, our impression was that US policy-makers still saw the US as having interests engaged in many parts of the globe, and sought UK and European support in defending and promoting them where they were shared in common.

43. Inasmuch as the US 'pivot' does involve a shift in US attention and resources towards Asia, the FCO told us that it was in accord with the UK Government's own effort to build the UK's diplomatic and economic ties to emerging powers and regions, beyond the traditional Transatlantic area.[162] The FCO presented Asia as an area where the US and UK should, and would, cooperate more closely in future.[163] The FCO also said that it was seeking to encourage more of the other EU Member States also to increase their engagement with Asia.[164] At the same time, the FCO said that the strengthened UK and US focus on Asia and their traditional Transatlantic alliance were complementary rather than alternatives: "the stronger our relationships are elsewhere in the world", it told us, "the more we can do to support each other as allies".[165]

44. Xenia Dormandy agreed with the FCO that Asia was an area where the UK and US Governments could do more together, although she identified the region as one where a lack of strategic collaboration meant that the UK and US were missing out on opportunities (see paragraphs 82-92 in Chapter 5).[166] Professor Richard Rose argued that, compared to the US, the UK had distinctive historical relationships in parts of Asia—including Australia, Hong Kong, India, Pakistan and Singapore—that put it at an advantage compared to the US. As a consequence, he argued that the UK had no need to rely on the US in the region, and that it could bring these distinctive assets to bear on UK-US cooperation there.[167]

45. Witnesses also identified Asia as an area where there were differences between the US and UK Government approaches, of the sort that we identified in paragraphs 20-22 (in Chapter 2) as likely to arise from the differences between the two states' geographic and strategic positions. Witnesses saw the UK Government's approach to Asia as being driven primarily by commercial considerations, whereas the US approach weighed security considerations much more heavily.[168] Xenia Dormandy and Sir Nigel Sheinwald both suggested that the UK Government needed to decide, in Sir Nigel's words, "whether its Asia pivot is overwhelmingly commercial, or whether there are political, security and economic policy elements to it as well".[169] As matters stood, Ms Dormandy told us that the UK Government's approach had "caused some concern" in the US.[170]

46. The divergence between UK and US Government approaches applied above all to China. Professor Robin Porter, who was Counsellor in the UK Embassy in Beijing in 2002-2005, said that the emergence of any sense of joint security responsibility for Asia between the US and China would be good for UK interests there; but that, at present, China was preoccupied by the military dimension of the US 'pivot', which it saw "as a renewal of 'containment' at one remove" and as "potentially hostile".[171] Bruce Stokes of the Pew Research Center also highlighted differences between the US and UK public views of China: in Pew's most recent polling, 52% of Americans had an unfavourable view of China, compared to 31% of Britons; and 44% of Americans saw China as a threat, compared to 29% of Britons.[172]

47. Witnesses appeared to differ on the extent to which the different approaches taken to China by the UK and US Governments represented a problem:

· Xenia Dormandy appeared to be more inclined to see the divergence as a potential obstacle to UK-US strategic cooperation in Asia.[173]

· Professor Porter and Lord Howell urged the UK Government to maintain a distance from US security policy in Asia, inasmuch as China might see the latter as threatening. Lord Howell advised the UK Government to adhere to a focus on its own commercial and political relationships in the region.[174] Jeffries Briginshaw, Managing Director (London) of BritishAmerican Business, told us that—because the proposed EU-US Transatlantic Trade and Investment Partnership (TTIP) was one plank in a US global trade policy that also included the Transpacific Partnership, which excludes China—there was a risk that by supporting TTIP the UK might be seen in Beijing as supporting a US policy against China.[175]

48. We doubt that the US 'pivot' to Asia is likely to involve as great a shift in US foreign and security policy attention and resources as has sometimes been suggested. Inasmuch as the US is increasing its engagement in Asia, we agree with the FCO that this may be in accord with the UK Government's own shift of attention and resources to the region, and that it need not be to the detriment of the Transatlantic relationship. However, Asia—and particularly China—is an area where differences may open up between the UK and US Government approaches, with the UK Government giving priority to commercial factors, and the US approach driven more heavily by security considerations.

Transatlantic issues

Transatlantic Trade and Investment Partnership (TTIP)

49. The idea of an EU-US free trade agreement has been mooted periodically over many years. At present, the EU and US grant each other no preferential trading terms beyond Most-Favoured Nation (MFN) status.[176] In November 2011, the EU and US agreed to create a High-Level Working Group to examine the potential of and for a deal; and in his February 2013 State of the Union address President Obama revealed that the two sides had agreed to launch negotiations for a Transatlantic Trade and Investment Partnership (TTIP). The deal could be the largest bilateral free trade agreement ever concluded. The start of the talks was announced at the G8 summit in Lough Erne in June 2013, and the fourth round was being held as we prepared this Report in March 2014.

50. In 2013, the Government expressed the hope that the talks might be concluded within 18-24 months of their launch (that is, by late 2014 or the first half of 2015).[177] The FCO's Kate Smith reaffirmed this ambition in evidence to us in December 2013.[178] Elisabeth Roderburg, TTIP Adviser to BritishAmerican Business, thought that mid-2015 was the most likely date for the conclusion of an agreement, and put the likelihood of a deal before the end of 2015 at over 50%.[179] However, in February 2014, the Rt Hon Kenneth Clarke MP, Minister without Portfolio, appeared to indicate some potential slippage in this timetable, telling the House that the Government hoped to complete the negotiations "by the end of 2015 or early 2016", before the next US Presidential election in autumn 2016.[180] A key factor affecting TTIP timing may be whether Congress grants President Obama 'fast-track' negotiating authority, under which the legislature agrees to put international trade deals, once reached, only to a relatively swift 'up or down' ratification vote. The President's 'fast-track' authority lapsed in 2007, and as we prepared this report Congress was blocking his request for a renewal, apparently with an eye to opposition to various aspects of the proposed Transpacific and Transatlantic free trade deals ahead of the November 2014 Congressional mid-term elections.[181]

51. The scope and content of any TTIP deal remain subject to significant uncertainty. The negotiations are expected to encompass market access, regulatory issues and non-tariff barriers, and what the High-Level Working Group called "rules, principles, and new modes of cooperation to address shared global trade challenges and opportunities".[182] On both sides of the Atlantic, and including in the UK, politicians and representative and interest organisations have expressed concerns about the potential impact of an agreement in a wide range of fields, such as the NHS in the UK.[183] The FCO's Kate Smith told us that the complexity of the potential agreement meant that the two sides had their "work cut out to conclude" it.[184] However, the Government has suggested that an "ambitious" TTIP could increase UK GDP by up to £10 billion a year, or 0.35%.[185] According to analysis produced for the European Commission, such a deal could, when fully implemented, increase the annual GDP of the EU as a whole by 0.5% and of the US by 0.4%.[186]

52. Xenia Dormandy told us that TTIP was "likely to be the most significant initiative the US engages with Europe on (including the UK) in the coming years".[187] Witnesses and interlocutors identified three respects in which TTIP, if it were concluded, could have an international strategic impact that would be of benefit to the Transatlantic alliance:

· In the context of the post-2008 recession in the developed world, renewed and sustained economic growth in the EU and US at higher levels would itself be of strategic significance.

· The regulatory rules and standards set in TTIP could, as a result of the combined economic weight of the US and EU, make their impact felt in the rest of the world, including among emerging economies with typically lower standards such as China. In this respect, TTIP could help the US and EU to reassert their influence in the global economy.[188]

· TTIP might provide a renewed underpinning for the Transatlantic alliance. Dr Niblett raised the prospect that the US "may [...] detach somewhat strategically from NATO", in which case he suggested that a "constant process of regulatory negotiation, convergence and debate" arising from TTIP might take its place.[189] Dr Oliver similarly suggested that TTIP might cause "the centre of gravity in Transatlantic relations [to] shift further from NATO towards the US-EU relationship".[190]

These potential features of TTIP accorded with the reasons that the Government has presented to explain its support for the initiative. The Government also places TTIP at the centre of its agenda for a reformed EU.[191]

53. We agree with the Government that the proposed EU-US Transatlantic Trade and Investment Partnership (TTIP) could have significant positive strategic impact for the UK—by boosting EU and US economic growth, providing a renewed underpinning for the Transatlantic relationship, and exerting influence over the global trade and economic system.

THE UK'S EU MEMBERSHIP

54. In January 2013, the Prime Minister announced that, if there were a Conservative Government in the UK after the 2015 General Election, it would hold a referendum on whether the UK should remain a member of the EU.[192] As a result of the Prime Minister's speech, the possibility of a UK exit from the EU has become a matter for mainstream policy discussion in the UK and abroad.

55. The US Administration, and our interlocutors when we visited the US, have made clear that the decision about continued EU membership is one for the UK. However, in January 2013, Philip Gordon, the United States' then Assistant Secretary for European and Eurasian Affairs, said publicly that it was in the United States' interest for there to be a "strong UK voice in a strong European Union".[193] The White House let it be known that President Obama repeated this message to the Prime Minister in a telephone call later the same month.[194] In its submission to us, the US Embassy described the EU as "the world's most important organisation to which the United States does not belong". It wrote:

195

Dr Oliver stated simply that "from Washington's perspective, having a pro-American UK in the EU enhances the prospects of the EU being a reliable American partner with whom it can defend and advance common interests".[196] Xenia Dormandy told us that the possibility of a UK exit from the EU was of "significant concern to US policy-makers".[197]

56. Dr Oliver argued that a UK exit from the EU would trigger two changes for the US, both of which would be unfavourable for it, namely:

i) A changed EU/Europe. Dr Oliver said that the EU is "a partner the US increasingly looks towards working with". However, he suggested that, with the UK outside the EU, Europe would be more divided, and the EU would be more inward-looking and protectionist, and more likely to give rise to fears in the US about the EU's development and capabilities—for example, in terms of its capacity to engage with geostrategic challenges. On defence, Dr Oliver speculated that, without the UK, the EU might develop stronger internal cooperation, but might also be even less capable than at present of shouldering its share of the Transatlantic security burden.[198]

ii) A changed UK. Dr Oliver expected that, if the UK were to leave the EU, UK-US economic, intelligence, nuclear and defence links would continue. However, he felt that, under these circumstances, the US would have a partner in the UK that would have a "reduced" geopolitical position and that would "still [be] facing painful dilemmas about its role in the world".[199]

For these reasons, Dr Oliver suggested that a UK exit might represent a "lose-lose scenario" for the US.[200]

57. Witnesses said that, in US eyes, the current questioning of the UK's EU membership was especially unwelcome given its conjunction with the TTIP negotiations. Xenia Dormandy said that the US wanted to see the UK "driving the agenda for the EU" on TTIP and that in this context "current British wariness of [the EU] causes some regrets".[201] Jeffries Briginshaw of BritishAmerican Business told us similarly that "everybody not in the UK wants the UK to be a driving force within TTIP".[202] Dr Oliver sketched a possible scenario in which—if the TTIP negotiations were protracted into 2015 or beyond—the possible renegotiation of the UK's EU status might undermine the TTIP talks, which in turn might undermine the case for the UK's continued EU membership, which in turn might further affect TTIP.[203]

58. As a result of the question mark over the UK's continued EU membership, several witnesses suggested that the UK would start to lose influence in the US, at least in relation to other EU Member States. Dr Niblett said that the US would start to "hedge" against a possible UK exit by developing its relations with other Member States on issues of importance to it.[204]

59. If the UK were to leave the EU, we believe that it would continue to have a close and valuable relationship with the US. However, the evidence we have received and discussions we have had have left us in little doubt that US policy-makers would prefer to see the UK remain an EU Member.

143 Q85 [Sir Nigel Sheinwald] Back

144 Q55 Back

145 Q85 [Sir Nigel Sheinwald]; Xenia Dormandy (USA 04) para 16. On the Libya operation, see Foreign Affairs Committee, Second Report of Session 2012-13, British foreign policy and the 'Arab Spring', HC 80, and Defence Committee, Ninth Report of Session 2010-12, Operations in Libya, HC 950 Back

146 Qq 11 [Dr Niblett], 85 [Sir Nigel Sheinwald] Back

147 Qq2, 11 [Dr Niblett], 85 [Sir Nigel Sheinwald] Back

148 Qq11, 14 [Dr Niblett] Back

149 Professor Rose (USA 11) para 1.1, Professor Porter (USA 15). Our predecessor Committee referred in its 2010 Report to the prospect of a demographically-driven lessening of UK-US cultural affinities: Foreign Affairs Committee, Sixth Report of Session 2009-10, Global Security: UK-US Relations, HC 114, paras 220-222 Back

150 Foreign Affairs Committee, Sixth Report of Session 2012-13, Foreign policy considerations for the UK and Scotland in the event of Scotland becoming an independent country, HC 643, paras 73-74, 121 Back

151 Foreign Affairs Committee, Sixth Report of Session 2009-10, Global Security: UK-US Relations, HC 114, paras 37, 216-222 Back

152 "Remarks By President Obama to the Australian Parliament", White House Office of the Press Secretary, 17 November 2011; Hillary Clinton, "America's Pacific Century", Foreign Policy, November 2011; Tom Donilon, "America is back in the Pacific and will uphold the rules", Financial Times, 27 November 2011. For a detailed account, see Congressional Research Service, "Pivot to the Pacific? The Obama Administration's 'Rebalancing' toward Asia", 28 March 2012; Kurt Campbell and Brian Andrews, "Explaining the US 'Pivot' to Asia", Chatham House Americas paper 2013/01, August 2013 Back

153 The East Asia Summit is the largest gathering of South, East and South-East Asian and Pacific states (including China and Russia). Back

154 As of March 2014, the negotiating states were Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the US and Vietnam. Back