The French Way (37 page)

In designing a new Europe, American links with NATO took priority for Washington, but the project of a single market complicated matters. At first the Bush team, despite lingering anxiety about a coming “Fortress Europe,” supported, much more explicitly than had the Reagan White House, the advance of the European Community (EC). At Boston University's commencement in 1989, where both he and Francois Mitterrand received honorary degrees, President Bush endorsed the Single European Act, declaring that, despite the apprehension of some Americans, “a strong, united Europe means a strong America.”
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The White House was less worried about a “Fortress Europe” than were the U.S. Congress and the business community. Trade experts in the Bush administrations like Robert Zoellick believed that openly backing integration was the best way for the United States to retain some influence within a remodeled and strengthened EC.
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And Jacques Delors, the European Commission's president, helped allay fears by visiting the United States and dismissing nervousness about a pending rivalry between the Americans and the EC. Yet uneasiness about “Fortress Europe” persisted. In 1990 Zoellick raised the question ofwhether the new Europe would be “insular, itinerant, or international”—that is, whether it would be protectionist, an independent force, or a true partner with the United States.
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Then the brutal negotiations over the GATT, along with quarrels over NATO reform—in both cases Paris acted as the principal protagonist—intensified Washington's concern about an inward looking Europe that would discriminate against American interests. In a speech in the Netherlands shortly before the EC summit at Maastricht in late 1991 President Bush warned that “we must guard against the danger that old cold war allies will become new economic adversaries, cold
warriors to trade warriors. There are signs on both sides of the Atlantic frankly, that this could happen.”
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In late 1992 French farmers torched the Stars and Stripes in front of the American embassy in Paris and stirred the ashes with pitchforks. Others blocked highways with their trucks and burned tires on railroad tracks. Still others protested outside McDonald's restaurants and trashed Coca-Cola vending machines. One Norman farmer complained, “The Americans have us by the throat…if GATT goes through, things could turn very nasty here.”
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What had stirred the countryside into this eruption of anti-Americanism?

Ostensibly the issue was rather mundane: it was one of trade talks—the Uruguay Round of GATT negotiations—and specifically farm subsidies and crops like rapeseed. (Audiovisual products and cultural protection were also involved, but this topic will be treated in chapter 6.) There were, needless to say, huge global markets, especially in agricultural exports, at stake in these talks. But the transatlantic clash over trade joined even larger issues. American officials worried that the EU might be moving toward closing the European market and becoming an ever greater rival in international commerce, especially in agricultural commodities. And it was France that was pushing Europe in the wrong direction. From the French government's perspective, keeping its rural constituents happy—farmers were adept at paralyzing traffic and arousing sympathy among the urban populace—was the most important, but not the only, issue in the Uruguay Round. France was willing to tangle with the superpower over agriculture principally because of the financial value of farm exports; after all, France and the United States were the two biggest exporters of such products in the world. France was also the largest exporter of food, including oil seeds, within Europe. And since the Americans cloaked their interests by invoking the principle of free trade, the French played the game in an even higher register by claiming farm subsidies called into question national identity, social protection, and even the future of the EU. What was at risk, it was held, was a rural way of life closely associated with national
identity. Such pleas evoked nostalgia about the farm and the village as the carriers of Frenchness. Beyond identity were the European model and the EU itself. Prime Minister Pierre Beregovoy expressed his fear that the United States intended to use the GATT to weaken the social and economic systems of Western Europe that afforded a high level of social protection.
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Elisabeth Guigou, the minister to Europe, accused Washington and London of trying to undercut the EU, declaring, “We do not want a Europe that is just a free trade zone, as certain Anglo-Saxon countries would like to see….Our attitude is explained by the French concept of Europe: it is not a Europe that is bellicose toward its outside partners, but it is a Europe that is more than a big market open to any and all influences.” The European community, Guigou concluded, “is the best way of preserving our social model.”
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Moreover, the Americans were less than pure when it came to open markets: the French complained they were denied access to certain sectors of the U.S. market, such as investment in, or purchase of, American high-tech companies. The issues of the Uruguay Round were both earthly and highly principled pitting free trade against national identity and the integrity of a united Europe.

The essentials of the story are these: Almost from the beginning of the Uruguay talks in 1986 France and the United States had been at odds over reducing farm subsidies. The U.S. government, in the name of free-market access, demanded reductions in the EC's Common Agricultural Policy (CAP), which provided such support payments. French farmers were among the primary beneficiaries of the CAP, receiving an estimated $7 billion in 1991. Talks approached a climax at the end of 1992 and the deep fissures between Washington and Paris over the issue of farm subsidies threatened to send the negotiators home without a final agreement. In face of French inflexibility, the Bush administration threatened to impose punitive tariffs on imports from the EC—for example, tripling the duty on French white wine. Then in November, at Blair House in Washington, representatives of the European Commission negotiated reductions in crop subsidies under the CAP. Leon
Brittan, who shortly afterward took charge of trade talks for the commission, thought the compromise avoided a looming trade war.

If the European Commission believed the Blair House Accord conformed to the agreed-upon reform of the CAP, France did not, arguing that negotiators had exceeded their mandate and accepted more drastic reductions in subsidies and acreage than allowed. The accord committed the community to sharp cuts in subsidized agricultural exports—for example, 21 percent for grain exports, and a reduction in the acreage of oilseed crops like rapeseed. Beregovoy called the accord “unacceptable” and a danger to “national interests”: he told the National Assembly that he would veto it in the EU Council and block the GATT entirely, if necessary.
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President Mitterrand and other socialists denounced the Blair House Accord as “imperialist,” and Jacques Chirac called it an “agricultural Munich.”
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In trying to checkmate the superpower, the French utilized several tactics. There was ultimately brinksmanship, as seen in Beregovoy's threat to scuttle the Uruguay Round. Paris, however, wanted to avoid this option and preferred to use the EU, which was the official negotiator, as a means of leveraging its resistance. Beregovoy asked his EU partners to sympathize with the sacrifices demanded of French farmers and pressured Chancellor Kohl to help, but only a few of the Europeans were listening. The British and the Italians endorsed the Blair House Accord; the Germans equivocated, leaving France in a weak position.
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At risk for everyone were the many gains from global trade liberalization that a successful GATT would bring. In order to intimidate other member states the socialist prime minister had to invoke the veto threat.
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A combination of a plausible veto and EU decision-making rules over trade, along with some backing from Belgium, Spain, and Germany, forced the commission to “clarify”—that is, try to renegotiate—the Blair House Accord.
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Another tactic was to dramatize the issue and blame the Anglo-Americans in order to stir popular protest against what was essentially an internal EU reform of the CAP. Alain Juppe, the foreign minister,
told TV viewers that “American ukases were not a method of international discussion.”
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The Blair House Accord, in his estimation, raised issues that were “important for culture and civilization.”
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Rural France responded, and farmers burned the Stars and Stripes while singing the Marseillaise. As the talks headed toward a crisis protesters built a pyramid of wheat in the courtyard of the Louvre imitating, I. M. Pei's glass structure. “It's a symbol of European prosperity that is now under attack,” one farmer commented.
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Farm lobbyists implored the government not to “kneel” to the Americans and betray Europe by acquiescing to the “American logic.”
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A survey in late 1992 found that over 80 percent of those polled expressed solidarity with farmers and their opposition to the GATT bargain.
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Government officials also raised the bogey of an Anglo-American conspiracy. It was said that the British were the Americans' willing partner in trying to weaken the EU, even wreck it as an economic rival.
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Some noted that it was a British official who had negotiated the Blair House Accord. The head of the union of young farmers denounced Britain and the United States: “Europe today faces a moment of truth: right now in Washington, the two Anglo-Saxons are preparing to sacrifice the ideal of a humanist and solidarist European construction to the globalized interest of capitalists and merchants. This repudiation would be the greatest diplomatic humiliation of Europe since its creation.”
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Figure 10. “No to the American diktat”: farmers in Paris protesting against the GATT, December 1992. Courtesy Peter Turnley/Corbis.

The political heat generated by the Blair House Accord and the CAP reform that antagonized farmers enflamed the French legislative elections of March 1993 and played a part in the defeat of the socialists. The election brought the conservatives to power and the Balladur/ Juppe team took charge of negotiations; at first they appeared as obstinate as their socialist predecessors, but in the end they had to retreat. Balladur bargained hard, threatening to block ratification while trying to avoid a showdown with the superpower. He had to work quickly because there was a December deadline. Unlike during the quarrel over the entertainment industry, in which much of the EU backed it, France had had to resort to threatening a veto to garner some support from other member states against the farm deal. Even the Germans became impatient with French stubbornness. Chancellor Kohl recognized Mitterrand's troubles with French farmers, but did not want to be caught between the transatlantic rivals: he counted on the French not to scuttle the talks.
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Balladur had to choose between a million farmers and his European community partners—especially the Germans. In June 1993 he dropped his objection to the cut in acreage for oilseed crops called for in the Blair House Accord. The Germans seem to have prevailed on this point.
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To ease the pain for French farmers Balladur increased certain subsidies and persuaded other members of the EU to help compensate oilseed producers for their possible losses. But the Americans played hardball. It has been said that the Clinton administration made a more forceful effort at opening international commerce than any previous
U.S. government. It declared there would be no GATT round unless agricultural subsidies were addressed; pressured Kohl; threatened to impose duties on European imports; and refused to renegotiate the Blair House Accord, only allowing it to be “reinterpreted.”

At the last minute, in December 1993, Washington made a minor concession over the timing of the reduction in grain subsidies that softened the blow for French farmers.
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In the end Balladur had to accept the Blair House Accord. Compromise was in the interests of France and the EU: if France remained inflexible, it would have faced serious pressure from its European partners, especially the Germans and the British, and risked the opprobrium of destroying seven years of trade negotiations. Balladur backed down and tried to put a good face on the compromise. The government pretended it had killed the Blair House Accord and Juppe said serenely that “everyone is happy because everyone has won.”
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When the National Assembly voted on the final package there was a broad consensus that the Balladur government had achieved all that could be realistically expected. The principal political actors, which included the political parties of the Right, the major farm lobby, and some trade unions, endorsed the GATT bill.
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Industry was silent because it wanted the GATT to succeed. If the socialists voted against it, they did so for domestic political reasons and backed the consensus that the GATT bargain was essential for a globalizing France. Opposition came from the periphery including the communists, the hard left faction of the socialists, the Green Party, and the Front National. Each had their reasons for attacking the agreement, be it protecting small farmers, developing countries, or the environment. But what they had in common was resentment against the United States, typically voicing dislike for American cultural and economic domination as a threat to French identity. On this common ground stood both those on the extreme right and left.