Chance to better relations

President Clinton stood before the crowd at his first televised town meeting and stated unequivocally: 'I am not going to roll over and play dead.' He was referring to European governments that subsidise their industries, in this case specifically, Airbus Industrie. It was the sort of macho-like campaign rhetoric that plays well in cities such as Detroit, still the motor car capital of America. But does it represent a sea change in US policy toward Europe as many officials in Brussels fear?

Sir Leon Brittan, the new EC Commissioner of External Relations with responsibility for trade, flew to Washington last week to determine just this. In taking the pulse of the new Clinton Administration, he met the obvious US counterparts, Mickey Kantor, the US Trade Representative and Ron Brown, the US Commerce Secretary. But beyond the obvious trade frictions that have sprouted alarmingly during the first three weeks of the new US Administration, Sir Leon was searching for a broader political opening. He and other high- level European officials fear the strong pillar that has been the Transatlantic relationship could founder if it is defined solely by trade issues.

The big question is whether the Clinton administration is amenable to a broader political relationship with Brussels that transcends the traditional meat and potatoes issues of trade. During the Bush Administration, at the height of European integration euphoria, James Baker, the Secretary of State, outlined an important new relationship when he exhorted EC member states to align themselves politically to stand as an equal partner to the US. No such policy has been articulated by the Clinton administration, but this almost certainly represents a lack of attention rather than a sea change in attitude.

In this respect, Sir Leon and other EC officials may in fact have an important window of opportunity to construct a new relationship along the lines they seek. Timing and personal chemistry often tip the balance in the grand scheme of things. Sir Leon and Jim Currie, the new EC number two in Washington, can thus be seen as Europe's 'secret weapons' in that both have strong ties to the new Administration through Robert Rubin, head of the new White House economic security council. Sir Leon and Mr Rubin were fellow students at Yale University and formed close bonds there. Later, when Mr Rubin was a top official at Goldman Sachs and Sir Leon was in charge of EC competition policy, the two met often in New York, where Mr Rubin hosted functions to introduce his friend to the cream of Wall Street. Mr Currie was invited along.

One hesitates to make too much of these personal ties other than to note that they can be very important in the early days of a new relationship. It is still too early to tell how powerful Mr Rubin's council will be in influencing policy and, most importantly, President Clinton's thinking. However, there is the possibility of an early, close White House-Treasury relationship that could tip the balance in Europe's favour and bring the State Department along. Again, we are examining personal ties. Mr Rubin has worked closely with Roger Altman, the number two at Treasury, who also came from Wall Street. Additionally, Mr Rubin's deputy at the White House, Gene Sperling, was deputy to Lawrence Summers, the new Treasury undersecretary international, when both worked on the Dukakis presidential campaign. Throw into this stew Peter Tarnoff, former head of the New York-based Council on Foreign Relations who has taken a top position at the State Department, and you have the makings of a new policy towards Europe.

What about Mr Kantor and Mr Brown, the front-line US officials on trade who are most closely in contact with Brussels? Again, it is unclear how trade issue will be treated - if indeed they are treated - within the broader economic and political strategy that President Clinton has promised. At the moment, particularly where Europe is concerned, US officials appear to be lurching along on a case-by-case basis waiting for a broader strategy to be designed. There are still key vacancies at Treasury and State. The balance of power at the White House is not yet determined.

Both Mr Kantor and Mr Brown are reportedly sensitive, however, to fears that they will be highly protectionist and domestically driven. Mr Kantor has tried to counter this image by seeking out a known free-trader to serve in his inner circle. The result is the appointment of Ellen Frost in the newly created position of counsellor to the US Trade Representative with responsibility for strategic planning.

Ms Frost, who worked most recently on an academic project addressing the retrenchment of the US defence industry, has spent years in the private sector advocating free trade positions. Prior to that, she worked in the Carter Administration as a deputy assistant secretary of defence. In her new position, depending on how well she connects to the White House and her good friends at State, she could well be one of the key definers of US economic policy and its strategy towards Europe.

Thus, Sir Leon may have a greater window of opportunity than anyone in Brussels now suspects in crafting a 'special relationship' with the US.