When it comes to finalizing a 15 percent global floor for corporate tax, Europe is the problem. Several governments with rock-bottom corporate tax rates today, including Hungary, Cyprus and Ireland — Biden’s ancestral home and notionally America’s strongest ally inside the EU — are resistant to the G-7 plan. Ireland remains wedded to its 12.5 corporate tax rate, and for Paschal Donohoe, Ireland’s finance minister, the fight is far from over. Officials worry that without stricter, binding domestic measures on climate caps, all the good rhetoric is devalued. “It’s easy to put forward climate goals, but without linking them to financial consequences via an emissions trading system, what does the goal mean?” said a senior EU official, who requested anonymity. “In the EU, countries can be fined for not meeting their climate goals. Biden is committed to multilateralism, but will they put their money where their mouth is?”
Play nice with friends “This ‘how can we trust you’ line is just an excuse for not diving in,” Baer said, adding that European leaders who held their nose up at Trump “need to show that cooperation can pay dividends.”
Former Ambassador Dan Baer, who served as the Obama administration’s envoy to the Organization for Security and Co-operation in Europe, agrees: “The question to Europe is: Now that you have someone who wants to do real business with you, can you put someone across the table to do the business?” “Sure Trump or Trumpism could come back, but Marine Le Pen could also be France’s next President,” said Stefanini. “If Truman had thought ‘what if Hitlerism comes back,’ the Marshall Plan never would have happened” in the aftermath of World War II, he added.
Stefano Stefanini, Italy’s former ambassador to NATO, said Biden has laid out a clear path for engagement. “As always, Europeans become edgy when confronted with a proactive U.S.,” he said. Former President Donald Trump paradoxically let Europeans operate in their comfort zone: “lecturing the Americans.” Now Europe needs to show where it wants to take the relationship: “Biden’s upcoming trip is an assist to Europe. It’s very much up to us to catch it,” he said. But some European and American former officials believe it’s time for Europe to get out of its comfort zone of criticizing Washington and embrace pragmatic cooperation with Biden.
“In Sweden, we like predictability and we have it again. Under Trump when we talked to one person at one level, it could be overruled an hour later by someone else,” said a senior Swedish diplomat. Overall, European officials expressed gratitude that Biden’s first foreign trip is centered on a string of European summits, and diplomats posted to Washington said they enjoy the return of a stable policy process in Washington.
Those choices in Washington have sharpened awareness in European capitals that the strength of their relationship with Biden will significantly depend on how much they cooperate with the administration’s efforts to curb China. Predictable or not, it hasn’t escaped notice that Biden is yet to invest in European diplomatic staffing: The Indo-Pacific team is the National Security Council’s largest policy unit, and Europe’s American ambassador residences remain empty. Getting to grips with China
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- Europe Asks: Can Biden Put His Money Where His Mouth Is?
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