Atlantic alliance or confrontation

2016 has caused a serious earthquake for the Western Alliance in the Anglo-Saxon wing with the Brexit decision coming from the referendum in Britain, and with Donald Trump's election as the 45th U.S. president. However, in the first half of 2016, the Transatlantic Trade and Investment Partnership (TTIP) was among the top subjects closely followed by the global economy. The "Looking to 2060: Long-term global growth prospects" report published by the OECD in Nov. 2012 did not draw a pleasant picture for the U.S. and the Eurozone between 2011 and 2030. Therefore, with initiatives by President Obama, new economic cooperation between the two sides of the Atlantic was brought to the agenda.

In conjuncture with the dissatisfaction of some EU member states rising because of negotiations that were highly challenging and led by Germany, Britain's Brexit decision was a total shock for both the future of the EU Project and for TTIP. The election of Trump who talked about pulling the U.S. out of all international agreements and who was against NAFTA, the TPP and TTIP was the second shock for the Atlantic Alliance. Trump's politics for the EU, completely setting aside TTIP, the rising uncertainty about the future of U.S. military bases in Europe, the U.S.'s decision to abandon the maintenance of EU's military security as of Jan. 20 when Trump officially takes office, may trigger developments that might mean that the two sides of the Atlantic will create a them-and-us situation within the 60-year-old Atlantic Alliance.

Even though the EU countries' foreign ministers, who met without the participation of foreign ministers of the U.K., France and Hungary on Nov. 14, talked about the fact that EU has various local and prior problems -- worries that the TTIP negotiations will be very tough for EU during the Trump period, Trump's statements on the necessity of higher spending for NATO by European countries, the possibility of a recovery in U.S.-Russia ties during the Trump period, the future of the nuclear deal with Iran and climate change - cause serious unease for the EU wing.

VW versus Apple

The leading causes of tension between both sides of the Atlantic in 2016 are not limited to Brexit and Trump. In a period when TTIP negotiations were not making progress fast enough, the tax fine imposed on Apple at the end of summer 2016 by the EU was just an eye for an eye, intended as a response to the Volkswagen scandal that broke out in 2015, which is construed as intimidating for Germany and the EU wing by the U.S. behind closed doors. VW, which was accused of intentionally lowering exhaust emissions, faced a more than $7 billion environmental fine, which was first discussed as over $10 billion. The company had to disclose that more than 11 million cars sold worldwide had software that the U.S. regulators found "objectionable." The U.S. Environmental Protection Agency (EPA) stated that the exhaust emission tests of Volkswagen's diesel engine cars were faulty. The report called on the German car manufacturer to pull half a million cars off the market.

Germany has experienced a serious loss of reputation with the VW scandal in an environment where global competition became rather vicious and the general setting in global growth and trade is very poor-spirited. At the same point, almost one year later, this time, the EU side fined Apple 13 billion euros in taxes because Ireland had reduced the tax on the company, which is against EU rules. EU Commission official Margrethe Vestager pointed out that the member countries can't provide a tax reduction to companies and that such practices are in contravention of the EU statute. The European Commission previously fined American coffee chain Starbucks and multinational automotive manufacturer Fiat Chrysler because of their tax policies in the EU. The fine marathon between the two sides of Atlantic indicates that U.S. and EU relations may not be on an easy course during the new period with Trump.

EU Commission hangs by a thread

That the Volkswagen "cheat in exhaust measurement values" scandal has recently put two EU institutions against each other draws attention. The commission delegated by the European Parliament to inquire into the scandal stated that the European Commission, the EU's executive body, had known about the scandal since 2010, but did not do anything. In the investigation report prepared by the European Parliament, specifically, the European Commission is accused of "negligence" and "turning a blind eye to the scandal." According to the report coming to the conclusion of negligence, the European Commission Joint Research Center (JRC) knew in 2010 that the amount of nitric oxide emitted by the cars on the street was higher than those in laboratory tests.

Evidence that resulted in the accusation that the European Commission overlooked the scandal is found in the Volkswagen internal communications. According to the report, the EU Administration did not fight the emission scandal out of worry that the automotive industry would be hurt and that a higher budget has to be put aside for inspections. Especially Spain, France, and Italy actively invested in lobbying activities in Brussels to prevent strict rules for the automotive industry. Recently, an investigation was also started against seven EU countries on the grounds that they overlooked the fraud in diesel car tests and protected their own businessmen.