International Futures Conference, German Foreign Ministry
Berlin, March 17, 2009

Remarks by Chargé d'Affaires, a.i. John M. Koenig

Good morning, ladies and gentlemen. 

Ambassador Sommers, thank you for including once again a “voice from America,” as you said in your letter, in the Foreign Ministry’s International Futures seminar.

This is an important year.  There are, for example, a number of important anniversaries – the sixtieth anniversary of the German constitution and the Federal Republic of Germany and the twentieth anniversary of the fall of the Berlin Wall.  It is also the sixtieth anniversary of NATO.  These are all important milestones in the trans-Atlantic partnership.

In the United States, we have a new President and an administration that is determined to set a new tone in America's relations around the world.  Every new beginning brings an element of hope.  Certainly President Obama was elected on a message of hope and change.  The world has already seen – long before the traditional benchmark of 100 days – that this new administration takes very seriously the need for countries to work together for the benefit of all of our countries.   President Obama believes very strongly in a shared worldview and a multidisciplinary approach to security issues.  In this new world that we live in, more than ever before, the way to get things done is to build partnerships and alliances.

Diplomacy, development and defense are the three pillars of the Obama Administration’s security strategy.  In plain words, that means that the United States will actively seek global opportunities to collaborate on issues that go beyond mutual concerns to addressing global concerns, such as climate change and clean energy, Afghanistan, Pakistan, nuclear proliferation, and other common concerns.  We will work together to try to assist those around the world afflicted by poverty, natural disasters, and disease.  We will strengthen our traditional and historic trans-Atlantic and trans-Pacific alliances, but also forge new partnerships with emerging nations.  Only a strong global network will enable us to solve problems that none of us can solve alone.

President Obama has been very clear in establishing his foreign policy priorities.  However, he has also asked his foreign policy team to review overall U.S. national security policy, as well as specific strategies relating to individual countries and regions. 
An important part of that review is dialogue.  Both Vice President Biden and Secretary of State Clinton have been to Europe to consult with our partners here.  In fact, the Vice President has come to Europe twice already.  On the weekend, I had a chance to work with Secretary of Homeland Security Napolitano as she met with her German and European counterparts here in Berlin. 

Afghanistan

During his presidential campaign, Obama identified the stabilization of Afghanistan as a top priority.  Upon taking office, he ordered 17,000 additional U.S. troops to the region to reinforce the NATO-led ISAF mission ahead of Afghan elections.  He also asked the National Security Agency, the Pentagon, and General David Petraeus, America’s military commander for the region, for a three-tier policy review of the U.S. strategy in Afghanistan in advance of the NATO 60th Anniversary Summit next month.

We hope that the Summit will launch work on a new, overall strategic concept for NATO.  The last NATO strategic plan pre-dates 9/11. It urgently needs to be re-worked to reflect 21st century threats. The challenges we face in Afghanistan and Pakistan are prime examples of why NATO needs to include a new “comprehensive approach” in its planning – an approach that is less reactive, more proactive; less rigid, more flexible; and less stationary, more expeditionary.   

As I said earlier, a key ingredient of the review within the U.S. government of security policies has been close consultations with allies. Afghanistan has topped the agenda in several of President Obama’s phone calls to world leaders.  Vice President Biden continued the conversation on Afghanistan with world leaders on the sidelines of the Munich Security Conference in Germany in February. 

He was also in Brussels last week to seek advice from NATO alliance’s principal forum, the North Atlantic Council.  While there he met with representatives from several non-NATO nations participating in the alliance’s 55,000-strong, 41-nation International Security Assistance Force in Afghanistan, as well as senior European Union officials.

The Vice President’s visit to Brussels came just days after Secretary of State Clinton’s visit to NATO for an Alliance meeting of Foreign Ministers.  She urged allies to consider providing more troops and training personnel for Afghan security forces, as well as civilian experts, in an effort to reverse deteriorating security conditions and strengthen the Afghan government ahead of elections later in the year. 

Veteran U.S. diplomat Richard Holbrooke as the Obama Administration’s special representative for Afghanistan and Pakistan has visited the region and is also in close contact with allies and partners. 

One of his primary goals is to improve coordination within the U.S. government, but also with NATO allies, and with non-NATO allies on efforts in the region.  We expect that the appointment of Bernd Mützelburg will improve coordination within the German government.  Ambassador Mützelburg is one of a number of Afghanistan-Pakistan coordinators appointed by key international partners in recent weeks.  We would welcome other countries appointing similar envoys. 

While we are still awaiting the outcome of the overall policy review on Afghanistan, the general approach is clear.  We need to develop realistic, medium-term goals that can be achieved within the next three to five years, in addition to our long-term commitment to help Afghanistan become a full-fledged democratic state.   The approach to the Afghanistan problem must be regional, involving not only Pakistan, but the other neighbors as well, including Iran. 

When Secretary Clinton visited Brussels earlier this month, she proposed the idea of what is being called a big tent meeting with all the parties who have a stake and an interest in Afghanistan. That would include NATO members, ISAF members – many of whom are not NATO members – donors, nations that have regional, strategic, and transit positions vis-à-vis Afghanistan, international organizations.  The conference will take place in The Hague on March 31, hosted by the Netherlands.  Iran has been invited as a neighbor of Afghanistan.  Pakistan is absolutely critical -- indeed, Ambassador Holbrooke has set the tone in U.S. policy by referring to Afghanistan hyphen Pakistan, or Af-Pak for short.  Of course, we also need to engage regional leaders and so-called "moderate" Taliban within Afghanistan to help reach a political solution – obviously with the Government of Afghanistan in the lead. This kind of engagement illustrates the "whole of government" or comprehensive approach that we believe is necessary to address the problems in Afghanistan. 

And as Secretary Clinton also outlined in Brussels, we need to devote more resources of all kinds to Afghanistan, both military and civilian.  You may have seen American press commentary on how we share the burden of supporting our common aims in Afghanistan.  The New York Times ran an editorial on this over the weekend.  If Germany can't provide more troops, hopefully it will be creative in contributing to the "civilian surge." 

For example, we welcome Germany's contribution to the FDD or Focused District Development plan, which is designed to transform the Afghan National Police into an independent, well-trained, ethnically-balanced, respectable and sustainable Afghan national security force, as well as its initiative in setting up the Border Police in Kabul, and its 35 million Euro project to establish a civilian airport operation in Mazar.
 
Russia

President Obama has also requested a review of American engagement with Russia.  The United States seeks improved relations with Russia through strengthened partnerships to confront a wide range of shared diplomatic and security challenges.  As Vice President Biden said and Secretary Clinton re-emphasized when she met Foreign Minister Lavrov, we are ready to press the reset button on this relationship. 

We are optimistic that we can work together effectively on joint issues of mutual interest.  These include cooperating on counter-terrorism efforts, seeking ways to work together in Afghanistan, renegotiating the START treaty, which expires at the end of this year, addressing Iran’s nuclear program, and improving relations with North Korea in the Six-Party Talks.  For example, we look forward to resuming our cooperation within the NATO-Russia Council on issues of mutual interest, as agreed by NATO foreign ministers at their meeting on March 5.    

That does not mean that there will be agreement on all issues. The United States, for example, will not recognize Abkhazia and South Ossetia as independent states. We will not recognize any nation having a sphere of influence. Sovereign states have the right to make their own decisions and choose their own alliances.  We stand shoulder-to-shoulder with Germany and many others on these principles.

Missile defense is another issue where there has been disagreement with Russia, even though it has been clear from the start that the limited missile defense system proposed for Poland and the Czech Republic -- consisting of just 10 interceptors with no explosive warheads -- was not oriented against Russia and poses absolutely no threat to its strategic deterrent.  The goal of the missile defense initiative is solely about protecting the United States and its allies from an Iranian ballistic missile threat.  As both Secretary Clinton and Secretary Gates made clear, if this threat can be mitigated in other ways -- for example, by persuading the Iranians to give up their nuclear weapons ambitions -- it is possible that plans for missile defense may change.

Financial Crisis

From these examples of regional challenges, it is obvious that a global approach is essential.  One global challenge that is of pressing concern to all is the current financial crisis. The crisis in our economies has very broad implications.

The popular idea is that the financial and economic crisis began in the United States.  According to this view, the Federal Reserve kept interest rates too low for too long, which contributed to a buying spree by the American public.  Particularly after 9/11, the U.S. government also had an expansionary fiscal policy.  U.S. regulatory authorities such as the SEC did not properly supervise lending, especially in the housing sector.  This allowed so-called "predatory lending" practices to occur.  The housing bubble popped, which pulled down prices of assets linked to the housing market.   Once the crisis reached Wall Street with the spectacular collapse of Lehman Brothers, it spread quickly overseas and the effects were amplified. 

Clearly, America played a major role in the crisis.  However, as many economists point out, risky lending was also taking place in Europe.  Here in Germany, several German banks started to experience problems even before the crisis erupted in the U.S. subprime market.  Flush with savings, German banks invested billions on risky assets in Iceland, Ireland, Spain and the UK.  This helped fuel speculative bubbles within Europe quite apart from anything occurring in the US. 

Beyond these proximate causes of the crisis is, in my view one of the other major, if not the major cause of the crisis: enormous global imbalances in the world economy.  Countries like the U.S. and UK have for years had enormous current account deficits, while others have had unsustainable surpluses.  Some nations run major trade surpluses as a matter of policy, not just as a result of competitive trade advantages.  These fiscal and trade imbalances or "macroeconomic factors" are much more difficult to address than "microeconomic factors" like regulation and executive compensation.  It's easier, however, to blame greedy bankers than to rethink the way entire economies are oriented.

In recent months, many have raised concerns about rising protectionism.  In particular, the “Buy America” clauses in the U.S. stimulus package have made some worry about the U.S.   commitment to open markets.  Yet the fact is there is nothing new in these provisions of the stimulus package, and Buy America is entirely WTO-consistent.  Moreover, President Obama has been very clear that he understands trade between nations is an essential part of a global economic recovery.  The United States remains one of the world’s most open markets.  As the world’s leading importer by far, we have fueled worldwide growth for decades.  In the fall of 2008, the United States and other G-20 member states pledged not to erect any new trade barriers in light of the financial/economic crisis.  We stand by that commitment.

There is broad consensus on the need to tighten regulations, improve coordination among governments and central banks, and strengthen the International Monetary Fund and Financial Stability Forum.  Most leaders recognize that we can't effectively manage economic behavior in New York or Frankfurt if investors divert transactions to secretive offshore banking centers.  We need to make sure our reforms are truly global and that individual countries and trade blocs consider their policies, including financial stimulus packages, in light of global impacts.   We need to include important emerging economies like China, India and other G-20 countries in the process and we need to respond effectively to less developed economies that are experiencing this crisis more profoundly than we are.  Doing so will require political courage on the part of all countries.

Globalization can be an enormous force for good. It is essential that we update our institutions and regulatory frameworks, so that the powers of globalization are channelled so that ordinary men and women everywhere can prosper and thrive. The global capital system allows money to flow to areas that previously couldn't get capital and allows them to develop and grow. Global economic growth potentially benefits everybody.  In these times of challenge, we need to take advantage of the opportunities of our interdependence. 

Conclusion

I opened my remarks by noting some important anniversaries. Let me conclude with another.  This year we mark the bicentennial of Abraham Lincoln, the 16th President of the United States.  Lincoln has earned a special place in American history because he repaired the rifts that had torn America apart during the Civil War.  Lincoln’s devotion to the idea of union came not from a belief that government always had the answer or a failure to understand the rights and responsibilities of individuals. Abraham Lincoln was born in a log cabin. He was a man of pioneer stock who cleared a path through the woods as a boy.  He taught himself all that he knew.  Everything that he had was because of his hard work. Lincoln recognized, however, that while each of us must do our part, there are certain things we cannot do on our own. There are certain things we can only do together.

As some of you may know, President Obama is a great admirer of Abraham Lincoln – in part because of that commitment to union.  In the globalized world of the 21st century, that lesson can be applied to all the countries of the world as they work together.  Ambassador Sommers, fellow diplomats, allow me to conclude with a bit of advice from Abraham Lincoln that all of us in this profession should learn.  “Tact,” Lincoln said, “is the ability to describe others as they see themselves.”  I hope this morning my voice from America provides a starting point for a discussion on our mutual perceptions and ideas about the role each one of our countries can play.  We will be remembered for what we choose to make of the difficult challenges we face.

Thank you very much for your attention.