Old wine in new bottles? What is new about Biden's plan for the economy?
Biden’s top priority will be to fight the Covid-19 pandemic and revive the domestic economy. Trump's “America First” policy comes to an end, although some elements might remain. What I expect from Biden is a more rules-based approach and clear criteria, as well as more predictability. The first statements that we have been hearing from his team follow these lines. However, we should not delude ourselves by assuming that everything will be different under Biden. Biden’s economic program is likely to also include some protectionist elements. He, too, will try to bring production and jobs back to the United States - albeit through means other than the Trump administration. At the same time, Biden's goal is to bring the United States back to the table of international diplomacy. Biden must balance two goals – promoting business at home and committing to multilateral solutions.
A transatlantic restart doesn't mean “back to the comfort zone”, does it? What should European businesses be prepared for?
As we all know, false or excessive expectations lead to disappointment, but I really do hope for a transatlantic restart. However, this will not be a foregone conclusion - it will require great efforts on both sides of the Atlantic. It is important that the EU itself invests very clearly in the transatlantic relationship and makes direct offers to the United States, not only in terms of trade policy, but certainly also in other areas such as security policy.
The myriad of trade conflicts with the United States will certainly not dissolve into thin air. Biden maintains close relations with labour unions and has already emphasised their importance in his first statements after the election. As a result, it is rather unlikely that the new administration will withdraw the steel and aluminium tariffs immediately. However, I am confident that Biden, unlike his predecessor, will not use tariffs for his own political profiling. The threat of auto tariffs should therefore be off the table under a Biden administration.
I see a greater chance for conflict resolution in the case of the WTO-incompatible subsidies for Airbus and Boeing. Here, both sides could send a strong signal by reaching a negotiated solution, which would have a positive impact on other areas.
One topic that is likely to remain contentious is the EU’s plans for a digital services tax. Such a tax is viewed very critically across party lines in the United States. I would like to see the United States participate again in the negotiations within the OECD (Organisation for Economic Co-operation and Development) and thus help us find a multilateral solution.
Biden has high expectations towards Europe. Will the EU be able to deliver? What responsibility falls on European businesses?
I believe that Washington's expectations towards Europe will be different under Biden. While Biden’s victory has been met with great excitement in Europe, this poses great challenges for the EU. Over the past four years, we often hid behind the public outrage over Trump. Biden's team will demand a clear geopolitical positioning from Europe.
This is not easy, especially in view of current geopolitical shifts and technological decoupling between China and the United States. Here, I also see a special challenge for businesses. Particularly in the digital sector, it is important in light of the expansion of the 5G network that European and U.S. companies develop approaches to strengthen their resilience in the face of aggressive Chinese trade and business practices. This is not simply a favour to the Americans: It is well in their own interest that German companies better balance their risks in East Asia by diversifying.
With regard to security policy, Biden’s new expectations have a very concrete meaning for Germany. Biden will remain firm on the two percent target. The EU must and can deliver. This is especially important to underpin a comprehensive geopolitical positioning.
Overall, however, I believe that European business has a responsibility to present a broad variety of concrete projects of transatlantic cooperation. Such a new transatlantic agenda should not only be limited to trade policy but should also cover many other areas such as climate and energy, health, education, and digital issues. I also find the area of aerospace very promising, where we see Europe already participating in the construction of the U.S. Orion lunar spacecraft. Why don’t we make the ”Return to the Moon” a major transatlantic project?