Death and the Salesmen

The Wall Street Journal, Review & Outlook:

The not-so-old saw about America being from Mars and Europe from Venus seems in need of an update. These days, when it comes to foreign policy, Europe seems to have much more in common with Pluto, the Greek god of riches and greed.

That may seem an odd claim, since America is generally the one credited with avariciousness. But it is Europe's foreign policy that seems increasingly driven by love of -- even desperation for -- lucre. read more

In every major foreign-policy challenge before Europe and the U.S. today, be it China, Iran or Russia, Old Europe, led by Paris and Berlin, invariably chooses closer economic ties over the tougher approach favored by Washington. Issues such as human rights, democracy and freedom, which have become the staple of President Bush's vocabulary, are hardly ever mentioned by French President Jacques Chirac or German Chancellor Gerhard Schröder. In the rare exceptions, it is conveniently argued that selling more of their goods to rogue regimes will somehow further these causes.

We take a back seat to no one in advocating free trade and our suspicions of economic sanctions as a political tool. But that assumes a global trade regime largely free of government intervention. Increasingly for Europe, trade is not only subject to government manipulation, but something that government itself seeks to conduct.

Last week, Mr. Schröder went on a seven-day tour through the Persian Gulf region with a 100-man-strong business delegation that collected deals worth more than $4 billion. As the chancellor was touring the region as his country's prime salesman, offering trains, planes and arms, human rights or democracy weren't on the agenda.

Similarly, the chancellor has yet to utter a critical word to Russian President Vladimir Putin. Instead, he says his friend presides over a "flawless democracy." Similarly, Mr. Schröder hasn't noticed any "significant disturbances" in the elections in Chechnya let alone the 100,000 dead there during that bitter conflict with Russia. Instead, he urges Germany's energy companies to increase their deals with Russian oil and gas firms.

But it is China, with its 1.3 billion consumers, which has really won Europe's attention. On a trip last year with 52 business executives, Mr. Chirac didn't speak about human rights. He returned with industrial orders worth more than $4 billion. Not to be outdone, Mr. Schröder made his sixth trip to China in as many years, returning with multibillion-dollar business deals himself.

Where this sort of thing spins out of control is when the merchandise is designed to kill people. Not even the most ardent free trader would argue that there should be no restrictions on trade in death-dealing materiel. But both Paris and Berlin have put themselves at the forefront in calling for an end to the EU's arms embargo against China.

In light of the economic data, Old Europe's suspension of moral considerations has the air of desperation. Beggars can't be choosers, as the old proverb says.

And increasingly, Europe is looking the part of the beggar. According to press leaks last week, next month the IMF will cut its euro-zone growth forecast to 1.6% from 2.2%. The German economy, which accounts for one third of euro-zone output, will grow a mere 0.8% this year, less than half the 1.8% the IMF predicted before. That's bad news for the more than 10% in France and more than 12% in Germany who are out of work. Contrast that with the U.S., where unemployment is less than half the German rate and the IMF expects economic growth to hit 3.7% this year, up from the 3.5% predicted earlier.

The result of this worsening economic malaise is that, even within its "chosen" policy realm of economic enticement and negotiation, Europe seems to be much less driven by choice than by circumstances. As the failure to reform increases Europe's dependency on exports, a foreign policy that hurts Europe's commercial interests simply appears less of an acceptable alternative.

Europe rationalizes all this by arguing that dangling economic incentives before the eyes of rogue regimes might steer them away from mischief. But the logic is inherently flawed, as the current negotiations with Iran make clear. Europe's assumption is that Iran would consider the offered economic incentives more valuable than completing its decade-long quest for nuclear arms. But if economic development where a priority for Tehran, the oil-rich country wouldn't have squandered billions of dollars in pursuit of nuclear technology in the first place.

What's more, Europe's dwindling economic power has not gone unnoticed. Tehran has made the calculation that Europe needs this deal more than Iran does -- for diplomatic and economic reasons alike. So it threatens to abandon the talks if they don't make any progress soon. Iran even admitted Sunday to having a years-old secret nuclear program and proficiency in the full range of activities involved in enriching uranium. In the end, Europe's ineffective negotiations, ostensibly designed to avoid a nuclear Iran and a military confrontation, have made both possibilities only more likely.

It appears that apart from helping Europe's army of unemployed, a much-needed economic revival on the Old Continent would also go a long way of making the world a safer place.