In international relations, there are times when you know another actor is probably bluffing. One would think that the best thing to do in these situations is call the bluff. In the short term, that is correct. But there is a catch; why is the actor bluffing? Sometimes it’s because they lack the capabilities. Sometimes, however, it is because they lack the hostile intent. In the long term, bluffing a hostile action can be the first step toward getting comfortable with the idea of treating an old friend as a new foe.
I bring this up because in the wake of the Trump administration’s exit from the Iran deal, a lot of questions are being asked about the future of the transatlantic relationship. In exiting the JCPOA, the administration made it clear that the next step will be applying secondary sanctions on European firms still doing business with Iran. Given European frustrations with this administration, will they comply or resist this move?
A few months ago, I wrote in this space that President Trump was not completely wrong to think he could coerce allies, but if he kept it up, there would be a reckoning:
If Trump could convince U.S. allies that the current pressure represents an extraordinary exception to traditionally strong alliances, it is possible that he might get some concessions. Clearly, however, Trump has no love for either the liberal international order or the U.S. alliance system. He cannot even feign commitment to animating ideas of the open global economy or America’s security community. And our allies have noticed. So they are going to be expecting a lot more conflict down the road. This reduces their incentive to acquiesce in the present.
I might be wrong, however. No doubt, there has been a firestorm in European media and foreign policy circles about Trump’s Iran decision. But during the past week there have also been a number of articles suggesting European governments and firms will suck it up because they value the transatlantic relationship more than the minor amounts of business they have with Iran. Exhibit A is the New York Times’s Steven Erlanger:
It is by now a familiar, humiliating pattern. European leaders cajole, argue and beg, trying to persuade President Trump to change his mind on a vital issue for the trans-Atlantic alliance. Mr. Trump appears to enjoy the show, dangling them, before ultimately choosing not to listen. …
However angry and humiliated, those allies do not seem ready to confront Mr. Trump, wishing to believe that he and his aides can be influenced over time. To some, it is reminiscent of what Samuel Johnson said of second marriages: a triumph of hope over experience.
Then there is the European Council on Foreign Relations’s Jeremy Shapiro, a one-man wrecking crew on Europeans backing down. In Foreign Affairs, Shapiro argues that Europe will not walk away from what is still a sweet transatlantic deal:
Of course, frustrations are mounting and eventually they will matter. But before we confidently assert yet again that “this time is different,” it is worth remembering why the alliance has sustained this frustratingly unequal bargain for so long.
The real question is not whether Europeans are pissed off but whether they will do anything in response to Trump’s actions. The answer is most likely no.
The simple answer is that Europeans need the alliance more than the Americans do. For Europe, the transatlantic alliance is its rock of stability in an otherwise ever-changing world and the foundation on which it has constructed European security and European integration. Shared values and interests, much more so than with authoritarian powers such as Russia and China, also drive the bond.
Politico’s Matthew Karnitschnig makes a similar point:
There will be no uprising, much less a revolution against American hegemony. For all of the public heavy breathing by Europe’s media and politicians in the wake of Trump’s decision to honor his campaign promise on Iran, behind the scenes, senior policymakers have pursued a more familiar European tactic — appeasement. …
European efforts to create “strategic autonomy” from the U.S. are in their infancy. The Continent, as European Commission President Jean-Claude Juncker bemoaned last week, can’t even agree on a common foreign policy. What hope does it have of forming a credible military force any time soon?
If the above authors are correct, then it would seem that Trump’s brand of coercive diplomacy will work. Europe will kowtow to secondary sanctions in return for not fundamentally altering the bedrock of European security.
And yet. What if this episode forces Europeans to start thinking about dynamiting the bedrock?
It’s no longer just pundits and low-level officials who are speaking out about the Trump administration. It’s also, you know, the president of the European Council, who is starting to say the quiet parts out loud:
Furthermore, the Europeans are starting to think about how to resist the secondary sanctions. Ellie Geranmayeh and Esfandyar Batmanghelidj have an essay in Foreign Policy on how this might come to pass:
Among the first responses proposed by a number of European leaders is to revive the EU “blocking regulation,” a move that hasn’t been used in more than two decades. French [Finance Minister Bruno] Le Maire has suggested that the revival of the regulation is at the top of the agenda. The original purpose of the regulation, as outlined in its preamble, was to abolish restrictions on international trade. …
Recourse to the blocking regulation today would be primarily about political leverage. Yet this is precisely why the regulation, updated and paired with countermeasures, is still a desirable option for Europe as it faces down Trump’s abuse of sanctions powers.
If EU leaders agree to revive and amend the annex of the blocking regulation to include the pending U.S. secondary sanctions targeting Iran, this will send a clear political signal to the Trump administration that Europe is willing to defend its interests and intends to influence how the United States implements its sanctions. This could trigger a more serious negotiation with U.S. interlocutors, who have a clear mandate to reimpose sanctions but who retain leeway in the specifics of implementation.
If Europe goes down this path, the implications on U.S. financial power would be considerable, warns sanctions guru Elizabeth Rosenberg in Foreign Policy:
These broad new Iran sanctions will encourage some countries to explore an array of alternative financial conduits to Iran, from barter to blockchain, to shield their banks and companies from U.S. jurisdiction. Russia and China are already pioneering alternative payment systems to stay outside of U.S. banks and currency, and these measures will likely accelerate that work and international interest. …
The most strategically significant unintended economic consequence of the new sanctions, however, is that these measures may ultimately weaken the strength of sanctions as a tool of U.S. statecraft. Limited or uneven compliance with the sanctions will contribute to the impression that sanctions do not work, which will make countries less likely to heed them in the future. In turn, this will make this tool of U.S. foreign policy less cogent and less useful to U.S. leaders not just to counter Iran, but against all security threats.
This would be devastating to the Trump administration, which has made maximum-pressure financial sanctions a cornerstone of an array of foreign-policy files, from Iran to North Korea to Venezuela and even now to Russia, in a reversal from its early interest in rolling back Russia sanctions. It will also be damaging to future presidents, shrinking the tools available to project U.S. strength and leadership internationally. Ultimately, this unintended legacy of the present reversal in Iran policy may be among the gravest and most debilitating for U.S. national security.
It is quite possible that America’s allies in Europe will back down — this time. But European resentment against American sanctions predated this administration. The Trump team’s bullying, combined with rising European hostility to the United States in public opinion polls, adds further political constraints to continued accommodation.
The irony is that the Trump administration is doing everything it can to try to push the European Union into acting like a great power. They want Europe to shoulder a greater defense burden. They are convincing Europeans that they cannot rely on the United States as an ally. If Europe were to ever commit to acting like a great power, it has the resources and capabilities to do so. In the areas where it already has that capacity — trade and regulation — it equals U.S. influence. Fans of U.S. hegemony will not like a world in which Europe has the will to do what it wants regardless of what Washington thinks.
At some point, someone’s bluff is going to get called in the transatlantic relationship. And no one in the West will win.