By Nicholas Hager, Transatlantic Community Analyst
NSA surveillance programs, whose operations have been gradually outed by NSA contractor Edward Snowden since May, have dealt a profound blow to U.S. credibility abroad. By tarnishing the trust that exists between the U.S. and its close allies in the EU, it has given rise to political and popular enmity, which may lead to an atmosphere of recalcitrance and reluctant coordination. This would be unfortunate at any time, but it is particularly so now as both regions find themselves needing to work closer to promote international security and boost the global economy. Major joint initiatives – including the proposed Transatlantic Trade and Investment Partnership (TTIP), the Terrorist Finance Tracking Program, and the Safe Harbor agreement – are at risk. Fortunately, the rift opened by PRISM and other programs can be healed and these initiatives can still be rescued.
The TTIP is the biggest potential casualty. The public outcry over the revealed NSA programs has been loud enough to prompt both EU Parliament President Martin Schulz, and others, to pen conciliatory op-eds, cautioning against overreactions. Christian Ehler, for example, reminds us to be mindful of the “much needed jobs and…economic growth” the TTIP would create. It is estimated to boost economic growth in the U.S. and EU by approximately 1/4 of a percent per year by 2027. In the words of Martin Schulz, “[the] final prize for…Americans and Europeans will be a stronger partnership, a larger market, lower prices and more jobs,” so it is imperative to see it through. Because of the acknowledged importance of the TTIP, it’s unlikely that recent revelations about NSA surveillance will scuttle negotiations. Rather, the fallout will probably lead to one of three general outcomes.
The first is the subtle but unfavorable alteration of the scope or utility of the agreement. Provisions to limit data sharing, eliminate the Safe Harbor agreement, or restrict the access of U.S. tech companies to the European market would abrogate a prolific space for cooperation and diminish many of the potential benefits of the agreement. E-commerce in the EU last year accounted for revenues of 312 billion euros and grew at a rate of 19%, while, according to Forrester Research, it grew at a similar rate in the U.S. Truncating this avenue of integration would, therefore, be quite costly. The second is a less dramatic outcome, which is the possibility that spite will taint the negotiations, slow them down, and delay the eventual implementation of the agreement. While not drastic, this could still lead to the loss of billions of dollars in potential trade revenue. The last, squabbling over institutional standards, is likely to be part of normal negotiations anyway, but if EU negotiators wanted to exercise the nuclear option, this is how they would probably do it. They could demand that their higher standards be the baseline for agreement, requiring, for example, that genetically modified food or hormone-treated meat be disallowed, knowing that the U.S. will not easily approve such a deal. This would either force the U.S. into spending money to accede, or induce Congress to reject the deal altogether.
The Terrorist Finance Tracking Program, which has also come under fire, serves to “identify, track, and pursue terrorists…and their networks” through review of their financial information. The U.S. Department of the Treasury vehemently asserts that the program has strict, independent oversight at all junctures, but recent revelations indicate that the NSA compromised SWIFT – “a Belgium-based company…that operates a worldwide messaging system used to transmit financial transaction information” – through the unauthorized collection of European financial data. The circumvention of safeguards has provoked certain members of the European Parliament to call for the suspension of the program. This would weaken the capacity of the U.S. to legitimately obtain this information going forward and impair its ability to track suspected terrorists in Europe; furthermore, it would likely increase illicit intelligence gathering. The strategic implications are therefore obvious, and it would be beneficial for all parties to avoid this outcome.
In addition, the Safe Harbor data-sharing arrangement allows U.S. companies to obtain data on EU citizens, thereby allowing them to use U.S. tech services such as Amazon and Google. The anxiety precipitated by the recent surveillance revelations is causing many in the EU to reconsider this agreement as well. This is unfortunate because its suspension could serve as an agent of deglobalization by blocking market access to EU citizens, forcing them to use potentially inferior or more expensive services. Moreover, as Brian Cunningham points out, revoking the Safe Harbor agreement may actually make European data less safe because the codification of this agreement is what provides the Federal Trade Commission with leverage against companies which fail to live up to the data protection standards that the agreement stipulates. Rescinding the agreement would tie the FTC’s hands and could lead to further data insecurity and a widening IT rift between the U.S. and EU.
It bears repeating that neither side wants these outcomes, and that there are plenty of opportunities to avert them. First, the U.S. must take steps to regain Europe’s trust. It must reassure them that it takes Europe’s privacy seriously, and it can do this by emphasizing its record of doing so. It already prosecuted Google in 2011 because it “violated its…privacy promises to [European] consumers,” so its willingness to uphold these standards is evident. It cannot stop here though; it must hawkishly prosecute such cases in the future as well. The U.S. should also be as open as possible with EU officials about who they’re investigating and why. This should alleviate some concerns that it is investigating average citizens instead of suspected terrorists. As with any relationship, the keys to restoring mutual trust will be openness and communication.
Second, we must remember that the EU is not monolithic. It consists of 28 sovereign states, each with their own objectives, interests, and normative outlooks and they can therefore not be reliably treated as a body with one mind. Edward Snowden provides an illustrative example here. After fleeing the U.S., he was denied political asylum in the EU, but now he’s being nominated for the prestigious Sakharov prize, given to individuals who “fight for human rights.” The lesson this demonstrates is a valuable one. Attempting to address and make amends for PRISM and other programs cannot be done simply on a U.S. to EU basis; rather, the U.S. would be wise to provide special, individual assurances to EU member states in addition to whatever other general measures they may take. This will help alleviate any bureaucratic resistance that a more unnuanced macro approach may leave unaddressed.
Finally, European discontent can be addressed through deeper intelligence cooperation between EU and U.S. agencies. It is common knowledge that European intelligence agencies have actively benefitted from the information that the NSA has collected anyway, so further operational cooperation would seem to provide a mutually beneficial solution. The U.S. could employ European capacities, while EU agencies can make use of U.S. intelligence and can keep apprised of who is being investigated in the process, allowing them or parliament to have at least some measure of oversight. While this could still rankle European privacy advocates, the process would likely become more effective and efficient, and would provide informal checks on both sides.