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America and Europe: Clash of the Titans?

By C. Fred Bergsten
March/April 1999
Article Summary and Author Biography

The euro's launch will transform the transatlantic relationship for good by placing Europe on an equal economic footing with the United States. If Washington does not face up to this and tackle outstanding trade and monetary-policy issues with its European partners soon, its current concerns-such as ballooning trade deficits and rising protectionist pressures at home-could spiral out of control. A good starting point for cooperation would be a joint initiative to limit fluctuations in the dollar and the euro. Trade negotiations between Europe and the United States also need a shot in the arm to get commerce flowing freely. An effective U.S. partnership with Europe is essential to avoid a showdown and maintain global leadership.

C. Fred Bergsten is Director of the Institute for International Economics and was formerly Assistant Secretary of the Treasury for International Affairs and Assistant for International Economic Affairs to the National Security Council. Copyright (c) 1999 by C. Fred Bergsten.

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