The Cheeseburger Agreement

Speaking of cheeseburgers and French fries, in the Oval Office Barack Obama and François Hollande signed an agreement that intends to save Greece, promote growth in the Eurozone and kick-start U.S. growth in time for Election Day. At the base of the Franco-American pact, the two leaders have convergent interests.

To be re-elected in November, Obama needs to quickly regain jobs and have a positive economic climate in the transatlantic area. Therefore, he cannot afford the scene of many months of uncertainty over the fate of Athens, and consequently, over the strength of the Eurozone. On the contrary, Hollande has the elections behind him, but aims to impose himself in Europe as leader of a coalition of countries that share the need to create jobs and raise the living standard of people. This is to ward off the assault of extremist parties, from the left and the right, powered by the disappointment against the fiscal discipline due to European agreements, which owe much to the Germany of Angela Merkel.

The re-election of Obama, as much as the bet of Hollande, revolves around the time factor, i.e., the necessity to quickly adopt stimulus measures in support of the economy, which could revitalize the development of both countries without increasing debts. For this reason, the head of the Elysée and Obama together put the emphasis on the fact that “our economies depend on one another.” This conveyed to the White House the feeling of finding a European counterpart who, compared to Merkel, is more interested in the American reboot. Berlin had at least two opportunities to prove its interest: In 2010, at the G-20 summit in Seoul, when it turned its back on Washington to side with Beijing in defense of their own trade surpluses, and in June 2011, when the White House welcomed the chancellor with unprecedented ceremony, only to meet with disappointment due to the continuous German fluctuations between committing to the firewalls needed to defend the European single currency.

Over the past two years, Obama had insistently looked to Berlin, believing that the most flourishing economy of the Eurozone was an indispensable interlocutor to revitalize the growth of the West’s GDP. But the unrelenting hesitations of Angela Merkel — often motivated by German domestic politics — changed his mind and put a strain on some of the veterans of the European Desk at the State Department.

Hence, the breathless search for a new European interlocutor that the recent French elections delivered to the White House — Hollande is bearer of an economic program that is very similar to the one drawn up by Obama’s team. It remains to be seen whether Hollande will be a credible partner for Obama in the pro-growth fight in the few months before the U.S. elections. Nevertheless, Barack has no other possible options: If the Italian Mario Monti is the European leader with the necessary credibility to deal with Berlin, then Hollande is the strategic ally to speed up growth. Hence the choice to take the offensive to the G-8 table, aiming today, in Camp David, to sign a pact that is able to stave off the nightmare that the collapse of the Eurozone could affect American elections.