 Good afternoon and welcome to the IIEA. No two continents in the world are interconnected in the way Europe and North America are. Trading goods and services is massive and has continued to grow in recent years despite some political turbulence in transatlantic relations. Investment flows going both ways across the ocean are even when compared to other intercontinental relationships greater than anywhere else. Ireland sits at the center of this economy, something that could be, say without exaggeration, transformed life in this country. A few other countries in Europe or elsewhere have closer ties to the US, including political and family ties. It's a pleasure to have Daniel Hamilton and Joseph Quinlan back to the Institute to discuss some of these issues in more. Their recently published Annual Transatlantic Economy Survey commissioned by the American Chamber of Commerce to the European Union and co-sponsored by Anne Jamarland is a Bible for all those with an interest in how our two continents conduct commerce with each other. Before they present the report, let me briefly introduce Daniel S. Hamilton, he's the Austrian Marshall Plan Foundation Distinguished Fellow and Director of the Global Europe Program at the Wilson Center. He is one of America's foremost experts in Europe, the transatlantic relationship in US foreign policy. He testifies regularly before the Senate, the House of Representatives and various European parliaments. He comments often in the US and international media and is an award-winning author of scores of publications on European and transatlantic security, economic and political affairs and on European foreign policy, on the US foreign policy issues. A former senior US diplomat, he is also a senior fellow at the Foreign Policy Institute of Johns Hopkins Seiss. Joseph Quinlan is a senior fellow with the Transatlantic Leadership Network and has a long and ongoing leadership role in the financial services industry in New York. Joe Lectures in Finance and Global Economics at Fordham University, where he has been a faculty member since 2008. He's also lectured around the world from Europe to Africa to Asia. In the years past, he has served as a consultant to the US Department of State and served as the US representative to the OECD, the US Council for International Business. This event is on the record and questions and comments will be most welcome. You can offer them via the Zoom Q&A function at the bottom of your screen. So with that, let me hand over to Joe, who will then hand over to Don and then we'll come back to questions. Thanks again to you both for joining us. Sure, Dan, thank you and good afternoon everyone. It's a pleasure to be here to talk about the Transatlantic economy. Hopefully you can take some time to look at the new survey, just chart full of data facts that are very important to the overall narrative. What I'm gonna do is just kind of outline economically where we are in the cycle because as everyone knows the last 12, 14 months unprecedented in terms of the pandemic, the lockdown, what it meant for the Transatlantic economy. And broadly speaking, as we talk about Dan and I, you know, we're in the healing process. The Transatlantic economy is healing. And if you saw the global GDP numbers from the IMF this week, they raised their global GDP estimates. So globally, economics are getting better. We're healing, we're coming out on the other side, but there's some divergence there and I'm gonna talk about that. So I'm sitting outside of New York right now and I can tell you from the US perspective, the economy's red hot. We're running around say 10% real GDP growth for the first quarter of this year. We've got a lot of forecasts that are talking about 7% real GDP growth for this candle under year which we haven't done that in decades. It's almost like China alike. And it's due to a couple of factors. The massive policy response from Congress and the Federal Reserve unprecedented, almost 20, 25% of GDP. Congress is already ladled out there, $5.3 trillion in stimulus and or recovery, however you wanna call it, 5.3 trillion. And we're not done yet, right? President Biden still has an infrastructure bill coming who knows how large it is. But the policy response from Congress has been more alike, times of war. We've never seen anything like this outside of war. And it's working. It is backstopping single moms who are on the front lines trying to struggling to work their way through the pandemic. It's backstopping small, medium-sized companies that would go out of business otherwise. It's backstopping a lot of the service activities that have been shut down. It's dropping a lot of cash into the households of a lot of Americans such that our savings rate is extraordinarily high, which means there's more powder to consume later on. So over that with the Federal Reserve, they almost doubled their balance sheet. So some argue there's too much stimulus out there. We'll see, it depends how it's being spent. Some of this money is paying off debt. Some of it's being saved. Some of it's used for consumption. So the fiscal and monetary response, along with the vaccination rollout, that's hugely important as well, are two big stimulus for the economy such that we're going to, as I said, grow by at least 7% this year and have a very strong momentum into 22. So we haven't seen these type of growth rates in decades. And there, as I said, they're like China-like. Vaccinating rollout, it's happening here. It's ramping up. There's plenty of supply out there. People want to get vaccinated, are getting vaccinated. We're going to see that happen. Granted, the variant out there is something we're watching very carefully, but stadiums are filled. People are going outside. They're going to the beaches. They're going to go out to the parks. There's going to be reunions. So we see a very strong U.S. economy. That's the good news. Kind of the more dampening news is over in Europe. That's where the divergence comes. Europe, Dan, as you know, always frustrates me, kind of bringing up the rear, so to speak. Vaccination rollout we know has been less than stellar, less than stellar, locked down in Italy, some of these service economies still. You kind of now some argue, well, that's where the United States is headed. I doubt that. I truly doubt that, given where we are with the vaccination, how well we're doing, and so forth. But Europe is dragging. Europe is, put it this way, the United States probably expanded by 10% annualized in the first quarter. Europe didn't expand at all, fell back into recession. All some of the PMI numbers are getting better, but there's a huge transatlantic divergence emerging. And to give you kind of an indication of what that means, it's only for the first two months, in the first two months of this year, America's trade deficit with the European Union exploded by 37%, 30% higher, because we're not exporting as much to Europe, we're importing more from Europe, and here we go. And we were coming off, I'm talking merchandise trade, Dan will talk about services, that's important as well. But we've already got the early signs that this divergence in growth can create its own stresses and strain. And you see it coming through in the trade numbers. You see it coming through in the foreign exchange markets as well. The dollar is slowly but surely regained its strength against the Euro, against the expectations of a lot of folks in the FX market. A lot of folks were looking for 125, but now they're going back to 115, someplace in the middle. So it's giving a big to the dollar. And the most kind of to me, kind of a discouraging point is that, Europe rolled out with this big recovery fund last summer. The markets got tremendously excited. And it was like, wow, this is a breakthrough, a Hamiltonian moment, so to speak, by which Europe is going to mutualize debt, have a kind of one Euro bond amongst bigger players that can be distributed, loaned, lent. It's a big deal. Kind of with one of those whatever it takes moments. Here's the problem, as everyone knows, not one Euro has been distributed yet. Not one Euro, right? The country's got to bring their plans to Brussels in April, then they'll decide which one where, and then maybe hopefully in the second half of this year, they'll start distributing the cash in the capital. Meanwhile, here in the United States, it's helicopter money. And we can argue if that's smart or not, because we got some debt and deficits play a letter. But just the policy response, the difference, the speed, the size, creates this divergence I keep coming back to, that to me, can make life difficult for our policy makers when it's setting like, what are we gonna do about trade policies? What sectors can we delve into and work together? Because if we go into this relationship in an unbalanced fashion and it's growing, then we've got some challenges that we need to be talking about. The good news here, where the United States, Dan can talk to this about as well, definitely more serious about ESG, the climate, how we treat the environment, social governments issues, we're becoming more on the same page. The multinational tax, that's gonna be something we've got to watch very carefully. And then my last comment before I throw it to Dan, is that the elephant in the room that Dan and I have been talking about for now over a decade, and that's simply China, right? How do you train you like, right? Dan and I have been doing, studying the transatlantic economy for decades. And we started out going, kind of looking across the pond. And that was the right thing to do because that's where the world economy's shoulders rest on. That's where the activity was, that's where the growth was, the profits. Well, in the last 10, 15 years, we've slowly but surely built our analysis to Asia in particular, but China in general, in the sense that this beast is for real. This is a legitimate contender for global growth polls, for setting global standards in various high-end industries. So Dan and I have been working a lot in this space, kind of triangulating this relationship. And so what does it mean? You know, is it either or? Is Europe have to choose technology standards from the US and the technology standards from China? And I'll just end by saying, I thought when President Biden and his team took over a couple of months ago, I actually thought US-China relations would improve but actually they deteriorated since the Biden administration showed up. Wall Street wasn't expecting that. A lot of policymakers will reset, we'll go quietly, we'll figure this out, we'll find commonalities and so all that good stuff. It's not happening. Taiwan now is a flash point for sure, right? Hong Kong has been, we know what's happened there. Now companies, right? European companies are in the crosshairs of that boycott, nationalist boycott of their goods in China. So this is, I'm not saying it's gonna spiraling out of control but it's getting interesting and it's getting hot. So Dan, let me pass it over you and you can go deeper. Thanks, Joe. Thanks to our hosts for having us here today. We appreciate it so much. Just on that last point, China is also becoming sort of the rationale for the infrastructure bill that's being the Biden administration is pushing. It's an interesting way of talking about it but there's an analogy which is in the 1950s, President Eisenhower used the Soviet threat to build the interstate highway system across America. It was the major change in the way America lived but it was all justified by the Cold War but that's how he got the money. And the same is happening I think now this time with the China, you can argue whether that's good or bad but that's I think where we are. Let me turn to a couple other elements about despite this turbulence, these divergences, why our relationship still remains the fulcrum of the global economy. And I think particularly for Ireland, it is as you know, really stunning sometimes when you look at some of the numbers and the dense connections we have across Atlantic. We have a special section in the report which I would encourage you, especially in Ireland, I think it's interesting on the digital economy, transatlantic digital economy. Because the digital economy is sort of becoming the economy in many different ways. It underpins so many different things. It's not really its own category. It is important to manufacturing services, you name it. And it's important to understand how it's evolving and changing. The problem we have with measuring that economy is that governments don't really have good data about data. And so we've come up with this way of metrics. It's five metrics that we have in the report to show the connections, digital connections across Atlantic. And I just want to highlight a couple. One is digitally enabled services. So these are services that could be sent provided digitally. They don't necessarily have to be. So it's a very expansive notion of it, but they could be. And this is where you see the deep linkages across Atlantic far far outweigh any other ones. The reality is the transatlantic economy is the fulcrum of the global digital economy. 75% of digital content produced in the world is produced in Europe or North America. And all the undersea cables that bring the internet to life are the densest across Atlantic. In fact, the speed at which they're being built out is also faster than any other trans-oceanic cables. And that the digital services, which I mentioned is what underpins this. We are each other's most important commercial partners in that space. At about 60% almost of US services per se are digitally enabled services. So you can see it's kind of taking over the services world. If you look at the trade in those services, US trade with Europe in digitally enabled services is about double what it is with the entire Asia Pacific region. And that's quite something. It's the same, in fact, if you put Asia Pacific and Latin America together, you'd get close to US trade with Europe in this space. And the US has a big surplus in this area. Joe mentioned the merchandise trade deficit, but it's a US has a surplus in services trade and in digitally services trade. It's not enough to compensate for the merchandise deficit, but it balances it a bit. And it's always important to include services when one talks about trade flows. The same is true if you look at the EU and its role in this world and who's its major partners. Before Brexit, this is a classification issue, the EU 28 or the EU 27, but before Brexit, the US had more trade with the EU and digitally enabled services than the rest of all the rest of Europe and all of the Asia Pacific. So just one country, the United States, more important than the entire Asia Pacific region to Europe in terms of these trade flows. Now, because the UK, which is such an important services countries not included in the EU, then the US falls a little bit behind. But I mean, this is sort of artificial in a way because it's the European flows are still there. So one country, as I say, essentially equivalent to the entire region of the half region of the world, the Asia Pacific region. And the second way to look at it is how companies really work. They prefer to be close to their customer and provide services where the customers are instead of sending them across an ocean if you can. And if you look at that, you see also services via affiliates of US companies. So US companies say in Ireland are much more important than services trade. And that's same as true for European companies that based in the United States. And those flows, again, dwarf anything that's going on with other parts of the world. So it's important to include investment flows and see how those work and how companies trade among themselves, also the digital space to show the recenter your picture of where who's important to who with a digital in an economy. What the OACE has done now is finally try to link trade flows to data flows. So data flows don't tell you about commercial value necessarily. Just because we're exchanging a lot of data doesn't necessarily mean it's really valuable. You could stream a video that's not have much monetary value but it uses up lots of gigabytes of data or you could send a financial transaction or architectural design at the click of a button that could be worth millions of dollars but it doesn't take up much data space. So one has to be careful here by just looking at flows but even the flows are still really intense across the Atlantic but the OACE just done now has shown what countries are trading based on those flows. So they are trying to now make a link here. And it's very interesting that the top two countries in the world, international trade underpinned by data flows. Number one is United States. Number two, Ireland. Ahead of Germany, ahead of the Netherlands, France, Switzerland, Sweden, those are all the next ones. There's no Asian economy mentioned in any of those top tier. The UK does a different data classification so it's not in the rankings but the OECD says it's also in that top tier. They just measure it differently. So it really shows you how strong this is, how important it is to Ireland in particular that it ranks so highly in that space. So that's, there's more in the digital economy but just to move on, there's been a lot of discussion recently prompted by a Eurostat report that China has become Europe's, the EU's top trading partner. There's a lot of media was full of that a few weeks ago and it's simply false. The way that may be interpreted, that was a report about trading goods and it ignored trade and services. And so I had to write some stuff. We both wrote in our report, just to again, recenter your mental image here to counter this sort of narrative. Gigi Ping just had a talk with Chancellor Merkel and he repeated that. He said, you know, we're your biggest trading partner and the Chinese are saying this all the time. It's just wrong. And one has to, you know, get a different picture. The way I would talk about it quickly is EU China commercial ties are like a country road, two lane highway, full of goods. It's a packed highway, it's bustling. There's lots of stuff going on. If you have an accident on that highway, you know, we're in trouble. We're building or EU is trying to build a investment lane, a third lane, but that's gotten stuck now because of the sanctions issues and the Chinese response. I just wrote a piece that said the CAI, Comprehensive Agreement on Investment is DOA, dead on arrival in the European Parliament. So I don't see it going anywhere. So it's blocked and it's, but it's a bustling highway, but it's only a two lane highway. The transatlantic economy is like a 12 lane autobahn. It's not just goods, it's also the services. It's the investment flows that I mentioned. It's the jobs, which are far, you know, there are many jobs coming from Chinese investment in Europe, but there are millions of jobs coming from American investment in Europe. It's all the digital connections that I just mentioned. And it's the innovation economy, R&D flows that we cover in our report. You put all of that together, that's the 12 lane autobahn. You have a wreck on an autobahn like that size, you're in real trouble. So we want to avoid that. And hopefully we will be able to clear up some of the irritants that we've been facing over the last number of years, which basically to the sort of the last point in terms of thinking ahead, some of the policy challenges we have. President Biden has said Europe is the cornerstone of American engagement in the world. He is an instinctive transatlanticist. He's also Irish as he tells everyone. But I mean, he has it in his bones to turn instinctively to European partners when it comes to lots of challenges. Now whether his administration does the same thing in all points, of course, is something that we have to think about. But you can already see by the attention that's being given that there's gonna be a big effort to kind of recast and reposition the transatlantic relationship and try to get the US EU piece of it to actually function. We had problems with that over the years. And so I would just identify a couple of areas where that is probably, there's opportunity. One is, as I said, is in the economic and trade field, we got to clean up these irritants that are lingering. We got tariff problems still. We have Boeing Airbus. They could solve that tomorrow if they really wanted to. They have turned a page by having a ceasefire at the moment for four months. Now, whether they can use those four months to actually resolve the issue, it's uncertain. But if the US and the EU can put that behind them, then they can turn to the real subsidy problem, which was not Boeing and Airbus, it's China's support for its own aerospace industry. But we can't address China like that when we've been identified by the WTO as the subsidizers in chief. So we have to take care of that. The US has proposed something now on digital taxation. We'll see how that goes, but it seems to be getting, it's a kind of a very different approach. And it's sort of back in the game on cleaning that up if possible, still controversial. And so as Joe had said, this is a time for healing. It's a time for moving our economies and our societies if we can from sickness to health. And you can wrap that up again to a new narrative that also includes climate and energy. That the issues we have, the Biden administration has also been very strong on the climate energy agenda, as you know, but they're coming at it with a different narrative. It's not just about the environment. When the president says build back better, he means talking about including environmental considerations into an economic plan. That means better jobs, more sustainable growth, more equitable access for people to the economic growth that we're experiencing. It's a different narrative than just the Paris Accords and climate change. It doesn't step back from that, but it is trying to win a broader coalition to support it, which is important, particularly in the United States. That means paying maybe some attention to new areas like Joe mentioned, sustainable finance or ESG standards, things like that. The EU is proceeding on a carbon border adjustment mechanism. The US is sort of cautioned on that saying, you know, if you gotta do it, it's gonna be a problem. Let's at least talk about it. And if it happens, it's gotta be WTO compatible. And at the moment the EU plans are not WTO compatible. So it's a different narrative. I think if the US and EU could buy into this new narrative and work on that together, then you're harnessing the economic plus the climate energy in a new way. I don't think there's big appetite soon for any TTIP like arrangement or any big trade agenda. It's really about getting our economies back on track. That's gonna, I think certainly for, until our midterm elections, seems to me to be where we'll be. The last piece I'll just end with is back on the digital. We are the fulcrum of the digital economy, yet we're having whole host of irritants across Atlantic and digital disconnects that have to do with, you know, privacy have to do with, you know, governance, data flows, all of this type of thing. The privacy shield was invalidated by the European court. They're renegotiating that. But fundamentally it's about different legal regimes. And I'm not sure diplomats are gonna negotiate away something that's really fundamentally a legal difference. So it seems to me we need to create a dialogue that just takes into account, we're gonna always have these frictions. Rather than think we're gonna solve them all the time, we're gonna have to just be aware of them and find ways to manage them. So we have proposed in our report, a USEU, you know, digital dialogue, basically on data governance that takes care of the platform regulation issues, anti-trust, the privacy concerns, online content issues, how the internet's even gonna be governed in the future, which is important because China's trying to set different standards for that. So that's a big agenda, lots of frictions, but overall I think you're finding kind of a, both sides of Atlantic and awareness, we need to come back together to address lots of these issues. We might, as the Secretary Blinken said, we might differ on this or that issue. We don't, our interests don't always align, but we do it within a sense of strategic realignment and that that is more what is still important across Atlantic that we are basically moving in the same direction and are so densely tied to each other. We literally can't afford to break apart or decouple from each other. So thank you.