Over the last few years, nowhere have tensions between the United States and its Europeanallies and friends been more evident than on a range of issues related to the Middle East. (1) These include Iraq, theIsraeli-Palestinian conflict, and Iran. Some worry that U.S.-European differences in combatingterrorism are growing wider. How best to approach the challenges posed by Syria may also figureprominently on the transatlantic agenda in the near future. Although the European countries are notmonolithic in their opinions with respect to the Middle East, views among them often tend to bemuch closer to each other than to those of the United States. This is largely because Europeanperspectives on the region have been shaped over time by common elements unique to Europe'shistory and geostrategic position. Some Bush Administration officials and Members of Congress are concerned that the recentvitriolic disputes between Washington and a number of European capitals on Middle East issuescould constrain U.S. policies, and erode the broader transatlantic relationship and U.S.-Europeancounterterrorism efforts in the longer term. The 9/11 Commission Report notes that nearly everyaspect of U.S. counterterrorism strategy relies on international cooperation, including with Europeangovernments and multilateral institutions such as NATO and the European Union (EU). Someprovisions in the Intelligence Reform and Terrorism Prevention Act of 2004 ( P.L. 108-458 ) seek toenhance international collaboration against terrorism. The Bush Administration has sought to mendtransatlantic relations in its second term, but U.S.-European policy differences over Middle Easternissues are likely to persist. Many analysts argue that the United States and Europe share common vital interests in theMiddle East: combating terrorism; halting proliferation of weapons of mass destruction (WMD);promoting Middle East peace and stability; ensuring a reliable flow of oil; and curtailing Islamicextremism. These experts assert that the goals of U.S. and European policies toward these variouschallenges are not that far apart. Both sides of the Atlantic tend to emphasize different interests. Europe largely views the Israeli-Palestinian conflict as the preeminent concern, believing it to be thekey source of regional instability that fuels terrorism, Islamic extremism, and domestic politicalunrest at home. In contrast, the Bush Administration stresses that terrorism and weaponsproliferation must be confronted to ensure U.S. national security, and that the conditions for peaceand stability in the Middle East will not be possible until these twin threats are removed. Thesedifferent perspectives often result in the employment of disparate tactics by the two sides of theAtlantic as they pursue their foreign policy agendas in the region. A combination of factors lie at the root of U.S.-European tensions on the Middle East. Theyinclude different histories, geography, and demographics; the nature of economic ties with theregion; somewhat divergent threat perceptions; and different views on the appropriate role of the useof force. Many analysts also suggest that current U.S.-European frictions over many Middle Eastissues are heightened on the one hand by European views of a unilateralist Bush Administration, andon the other by growing EU ambitions to play a larger role on the world stage. Europe's long and complex history with the Middle East shapes its views toward the regionin ways that are distinct from those of the United States. Europe's ancient religious crusades andmore recent colonial experiences in the Arab world still weigh heavily on its collective psyche, andproduce twin pangs of wariness and guilt. This wariness leads many Europeans, for example, tocaution Washington against overconfidence in its ability to win the battle for Arab "hearts andminds" through force, or to impose stability and democracy. Residual guilt about Europe'scolonialist past causes many of its citizens to identify with what they perceive as a struggle forPalestinian freedom against Israeli occupation; at the same time, the Holocaust engenders Europeansupport for the security of Israel, but Europeans believe this will only be ensured by peace with thePalestinians. Finally, Europe's own bloody history has produced a broad European aversion to theuse of force and a preference for solving conflicts diplomatically (see below). (2) Europeans claim that the Middle East is part of "Europe's neighborhood," and this proximitymakes the promotion of political and economic stability key to ensuring that problems in the regiondo not spill over into Europe. As examples, Europeans point to several incidents of terrorism ontheir soil over the last three decades stemming from the Israeli-Palestinian conflict, and recent wavesof migrants fleeing political instability and economic hardship. These new migrants add to Europe'salready sizable Muslim population of between 15 to 20 million, which has its roots in Europeanlabor shortages and immigration policies of the 1950s and 1960s that attracted large groups of Turks,North Africans, and Pakistanis. In contrast, the U.S. Muslim population is significantly smaller;estimates range from 4 to 8 million. (3) Moreover, Islam has become a vital force in European domesticpolitics. Some argue this makes European politicians more cautious about supporting U.S. policiesthat could inflame their own "Arab streets" and deepen divisions within European societiesstruggling to integrate growing Muslim populations amid rising anti-immigrant sentiments. Conversely, many analysts suggest that the politically well-organized Jewish community in theUnited States engenders stronger U.S. support for Israel. Europe's extensive economic ties with the Middle East have also received considerable publicattention as a key reason for differing U.S.-European approaches. The EU is the primary tradingpartner of the region. Although a substantial element of this trade is oil, and any changes in the priceor supply of oil would also affect the United States, overall European economic interests are moreintegrated with the region. EU exports to the Middle East, for example, are almost three times thesize of U.S. exports. (4) Some analysts argue that many European countries are primarily motivated by the need to protectthese commercial ties with the region, and often do so at the expense of security concerns. Otherspoint out that if such commercial interests were the drivers of French and German opposition to thewar in Iraq, then both countries would have served those interests better by supporting the U.S.-ledwar to guarantee a share of the post-Saddam Hussein spoils. Still, many experts agree that Europeancountries' extensive trade and economic ties with the region heighten their desires to maintain goodrelations with Arab governments and makes them wary about policies that could disrupt the normalflow of trade and oil. (5) Some observers assert that since the end of the Cold War, American and European threatperceptions have been diverging. Throughout the 1990s, U.S. policy makers often complained thatEurope was preoccupied with its own internal transformation, and largely blind to the newinternational threats posed by terrorism, weapons proliferation, and other challenges emanating fromthe Middle East. Some say the terrorist attacks of September 11, 2001 exacerbated this gap inU.S.-European threat perceptions. While Europeans view terrorism as a major threat, Americansperceive the threat as being much more severe. European officials assert that while some Europeanleaders, such as UK Prime Minister Tony Blair, see and worry about possible links between terroristgroups and weapons proliferators in the Mideast and elsewhere, the average European citizen doesnot. And in certain European countries like Germany, other issues -- such as the economy andpromoting stability in the nearby Balkans -- have taken precedence. (6) A number of analysts suggest,however, that the March 11, 2004, terrorist bombings in Madrid, Spain, have heightened Europeanperceptions of the threat of Islamist terrorism to Europe. One opinion poll from June 2004 foundthat Americans and Europeans now share broadly similar threat perceptions but differ sharply on theuse of force for managing such threats. (7) As a result of Europe's history both pre- and post-World War II, numerous observers suggestthat Europeans are more prone to emphasize multilateral solutions based on the international ruleof law. Many Europeans claim that it is precisely because they have abided by such rules andworked cooperatively together in institutions such as the United Nations and the European Union(and its progenitors) that they have enjoyed decades of unprecedented peace and prosperity. Combined with the devastation they inflicted on themselves and others in the first half of thetwentieth century, many Europeans -- especially Germans -- shy away from the use of force tomanage conflicts and place greater emphasis on "soft power" tools such as diplomatic pressure andforeign aid. They are wary of the use of preemptive force not sanctioned by the internationalcommunity. U.S. critic Robert Kagan calls it a "power problem," observing that Europe's militaryweakness has produced a "European interest in inhabiting a world where strength doesn't matter,where international law and international institutions predominate." (8) Most Europeans, however,reject this thesis. French and British officials in particular argue that they are not pacifists and citetheir roles in the NATO-led war in Kosovo and the U.S.-led military campaign against the Talibanin Afghanistan as just two examples. Many analysts believe that European perceptions of the Bush Administration as inclinedtoward unilateralism and largely uninterested in Europe are exacerbating current transatlantictensions over the Middle East and Persian Gulf. Before September 11, many European governmentswere critical of the Administration's position on international treaties such as the U.N. KyotoProtocol on climate change and its decision to proceed with missile defense. The terrorist attacksswept some of these contentious issues under the rug for a while, but U.S.-European frictionsreturned in early 2002. Many European leaders were alarmed by President Bush's characterizationof Iraq, Iran, and North Korea as an "axis of evil." Other U.S. moves ranging from rejecting theInternational Criminal Court to imposing steel tariffs reinforced the notion that Washington was notinterested in consulting with its long-time allies or committed to working out disagreementsdiplomatically. Furthermore, Europe's history makes many uncomfortable with what they view asthe Bush Administration's division of the world into good and evil and the religious overtones ofsuch terminology. A French commentator asserts, "Puritan America is hostage to a sacred morality;it regards itself as the predestined repository of Good, with a mission to strike down Evil...Europeno longer possesses that euphoric arrogance. It is done mourning the Absolute and conducts itspolitics...politically." (9) Europeans have welcomed the Bush Administration's efforts in its second term to improveU.S.-European relations. Some say that the February 2005 trips to Europe by President Bush andSecretary of State Condoleezza Rice have helped mend fences and improved the atmospherics of therelationship. However, transatlantic tensions have not disappeared, and many Europeans remainskeptical about the degree to which Washington views Europe as a full and valued partner. Some experts assert that the EU's aspirations to play a larger role on the world stage have alsoheightened recent U.S.-European tensions. For many years, the EU has been the key donor offinancial assistance to the Palestinians and has sponsored a range of region-wide developmentalprograms. But the EU's effort over the last decade to develop a Common Foreign and SecurityPolicy (CFSP) to help further EU political integration has prompted the EU to seek a higher-profilerole in the region that goes beyond its traditional "wallet" function. (10) The EU has had somesuccess in forging consensus on its approach to the Middle East peace process, and how best to dealwith Iran. Some say this has helped make certain EU members, such as France, more confident andassertive about confronting U.S. policies with which they do not agree. At the same time, the EUwas unable to agree on a common policy on Iraq; key players such as the United Kingdom, Italy, andSpain more closely supported the U.S. approach to the use of force against Iraq. Critics note that theEU still has a long way to go before it is able to speak with one voice on foreign policy issues, butthe frustration this produces for countries like France may exacerbate reflexive impulses against U.S.leadership. The combination of underlying factors mentioned above help account for many of thedifferences in U.S. and European policies on a range of challenges in the Middle East. Key policygaps exist in U.S. and European efforts to deal with Iraq, address the Israeli-Palestinian conflict,manage Iran and Syria, and counter terrorism. Led by France and Germany, European countries opposed to using force to disarm Iraqasserted that the case for war had not yet been made. They were skeptical of U.S. arguments directlylinking Saddam Hussein and Al Qaeda, and did not view the threat posed by Iraq as imminent -- inpart, because they believed that the 12 years of international sanctions had limited Iraq's ability toacquire weapons of mass destruction. (12) Thus, France, Germany, and others deemed a contained SaddamHussein as a threat they could live with, especially given their judgment that war with Iraq wouldhave dangerous and destabilizing consequences. Many Europeans feared that toppling Saddam couldfurther fragment the country along ethnic and tribal lines, and generate instability. A number of European governments also worried that war with Iraq would inflame their owndomestic "Arab streets," especially given the stalemate in the Middle East peace process. Europeanofficials pointed out that many Muslims view Israeli Prime Minister Ariel Sharon in much the samelight as Washington did Saddam Hussein, and reject as a double standard the use of force againstIraq. Even UK officials who supported the U.S. approach to Iraq were concerned that war couldfurther antagonize Muslims both in the region and in Europe without tangible progress on theIsraeli-Palestinian conflict. Moreover, some Europeans stressed that rather than helping to curbterrorism, war with Iraq would be an additional rallying point for Al Qaeda recruiters and othermilitant Islamic groups. (13) Numerous Europeans also opposed war in Iraq without explicit U.N. authorization becausein their view, it risked destroying the international system of rules and laws created after World WarII to maintain global peace and stability. In light of German history, Berlin was especially reluctantto agree to any preemptive measures not sanctioned by the international community. Even London,Madrid, and Rome, which more closely backed Washington's approach to Iraq, would have preferreda second U.N. resolution explicitly authorizing the use of force. Many Europeans now worry thatthe Bush Administration has opened a Pandora's box. Some note that other states with territorialambitions, perhaps Russia or China, could feel freer to launch similar measures against borderregions under the pretext of preempting threats to their national security. The U.S. action in Iraqcould also prove counterproductive if it encourages other countries to speed up or initiate programsto acquire WMD capabilities in an attempt to deter a U.S. attack. The Bush Administration countersthat the war in Iraq has had precisely the opposite effect, encouraging Libya to abandon its WMDprogram. French and German officials also discount criticism that their preference for a diplomaticapproach to countering Iraq's WMD ambitions was motivated by economic interests. They claimthat 12 years of sanctions reduced these interests to a minimum, and also prohibited oil contractsagreed with Saddam Hussein's regime from taking effect. (14) These officials also note that Paris and Berlin had somewhatlarger financial interests in Iraq prior to the 1990 invasion of Kuwait, but they did not hesitate thento join the coalition against Iraq. At that time, they point out, Iraq had clearly breached internationalrules and posed a clear threat to stability. In the aftermath of the war, U.S.-European tensions over Iraq have abated to some degree,but still linger. U.S. officials have been frustrated by what they view as minimal military or financialassistance from some European countries. Throughout the U.S.-led occupation of Iraq, which endedin June 2004, the role of the United Nations in rebuilding Iraq was a major sticking point. MostEuropean countries, including the UK, favored giving the United Nations a significant role to bolsterthe credibility of the reconstruction process. In contrast, Washington initially favored a narrow,advisory role for the United Nations, with most U.N. activity focused on providing humanitarianassistance and coordinating international aid donations. Washington's position on limited U.N.participation in Iraq won out in the immediate aftermath of the war, as seen in a Security Councilresolution agreed to in May 2003. Although France and Germany approved this resolution, theyannounced that they would not contribute troops or significant bilateral financial aid in light of therestricted U.N. role; they, like several other smaller European nations, were reluctant to become"occupying" powers in Iraq. (15) In September 2003, the United States began seeking to increase international participationin stabilizing Iraq amid ongoing insurgency attacks against U.S. and coalition forces. In October2003, the Administration secured another Security Council resolution calling on the internationalcommunity to help rebuild Iraq, and giving the United Nations a marginally larger role in forginga new Iraqi government; however, it left the United States in overall control of Iraq's transition. Asa result, the resolution fell short of the expectations of many, including France and Germany, andfailed to overcome their resistance to sending troops to Iraq. In June 2004, Washington gained unanimous U.N. Security Council approval of a newresolution endorsing the transfer of Iraqi sovereignty and giving the United Nations a key role insupporting Iraq's ongoing political transition. European governments and EU leaders welcomed thereturn of sovereignty to Iraq and the enhanced U.N. role, but substantial additional European militaryand financial contributions to stabilizing and rebuilding Iraq have remained elusive. France andGermany, among others, continued to object to what they perceived as an ongoing U.S.decision-making monopoly on Iraq policy, especially with regard to the conduct of security policy. They were also resistant to putting their troops in danger to bolster a military campaign that they didnot approve, and which, they believe, has led to an increase in terrorism. Some European countries were also initially hesitant to support a NATO role in Iraq. At theJune 2004 NATO summit in Istanbul, European allies agreed to a request from the new Iraqigovernment for NATO help in training Iraqi security forces. In December 2004, NATO foreignministers decided to expand the alliance's training personnel in Baghdad from 60 to 300 officers,including both trainers and support staff. Six European allies (France, Germany, Belgium, Greece,Spain, and Luxembourg) refused to allow their nationals on NATO's international staff to take partin this mission; they reportedly feared that the training mission could evolve eventually into a combatoperation. During President Bush's February 2005 trip to Europe, however, NATO announced that ithad gained commitments from all 26 allies to contribute to NATO's training of Iraqi security forces,either in or outside of Iraq, or through financial contributions to one of three NATO trust funds forIraq (totaling more that $4.5 million). NATO believes that these commitments will enable it toprovide training eventually to about 1,500 Iraqi officers per year, both inside and outside of Iraq. There are currently 165 NATO personnel in Iraq. In September 2005, NATO opened a Joint StaffCollege outside of Baghdad to provide management and leadership training for Iraqi militaryofficials. (16) Many observers view the NATO agreement reached in February 2005 -- although stillrelatively modest -- as extremely positive, demonstrating a new alliance unity of purpose and actionin Iraq that will help improve U.S.-European relations. Some observers had hoped that the January2005 Iraqi elections for an interim government would lead other countries, such as France andGermany, to engage more robustly in rebuilding and stabilizing Iraq. However, significant additionalassistance has not been forthcoming. France initially resisted taking part under a NATO umbrellato training Iraqi security forces, although it eventually relented and agreed to contribute financiallyand to provide one French military officer, who will help support the training mission at NATO'sheadquarters in Belgium. Germany points out that it is training Iraqi police and military forcesoutside of Iraq, and France has made similar offers to train Iraqi security forces. At the same time, financial constraints on already tight defense budgets and public pressureto withdraw troops in the face of continued violence in Iraq are leading several European countriesto draw down their forces in the U.S.-led multinational coalition. The new Spanish government,elected shortly after the March 11, 2004 terrorist bombings in Madrid, withdrew its 1,300 troopsfrom Iraq in May 2004 and has no plans to re-commit forces. The Hungarian Parliament rejecteda government proposal to extend the mission of its 300 troops beyond the end of 2004; Polandreduced its contingent of 2,400 troops to 1,700 in early 2005; and the Netherlands withdrew its 1,400soldiers in March 2005. Bulgaria has announced that its 400 troops will leave Iraq after theDecember 15, 2005 parliamentary elections for a permanent Iraqi government, and press reportsindicate that the United Kingdom and Italy may consider troop reductions over the next year. (17) The Bush Administration has been seeking to maintain existing international commitmentsin Iraq. Media reports suggest that U.S. officials have been presenting ways for allies with forcesin Iraq to shift their troop commitments to new training and reconstruction-related missions as Iraqiforces become more able to take over security responsibilities. Currently, 13 European countries thatbelong to NATO and/or the EU are contributing either troops or police to Iraq, as are Albania andMacedonia, which harbor NATO and EU membership aspirations. The size of many of thesecontingents, however, is extremely small, with some numbering only a few dozen personnel. (18) EU officials say they are determined to help rebuild Iraq. In July 2005, the EU launched aone-year mission to train Iraqi police, administrators, and judges, primarily outside of Iraq at presentbecause of security concerns. The EU will establish a liaison office in Baghdad, however, and mayconsider future training in Iraq if security conditions improve. In addition, the EU will help financean international protection force for U.N. personnel and facilities in Iraq, but EU member states areunlikely to provide troops for this force. (19) EU leaders also point out that the EU and individual European governments are contributingfinancially to Iraq's reconstruction. At the Madrid donors conference for Iraq in October 2003, theEU and its member states pledged a combined total of $1.25 billion for Iraqi reconstruction,including roughly $235 million (for 2004) from the EU community budget. (20) Bilateral reconstructionassistance offered at the Madrid conference included contributions from some EU members thatopposed the war, such as Belgium and Sweden. Separately, Germany has contributed roughly $155million, mostly for humanitarian assistance, since the outbreak of the Iraq war in March 2003, andFrance has provided about $11 million in humanitarian aid. (21) To date, the EU has provided over $600 million in reconstruction and humanitarianassistance to Iraq from its community budget since 2003 and has proposed about $240 million morefor Iraq in 2006. The EU has also provided about $96 million to support Iraqi elections and itsreferendum on a new constitution in 2005. As a result, the EU claims that it is the majorinternational donor of election assistance to Iraq and a key supporter of its current politicaltransformation. (22) In December 2005, the EU announced that it hopes to open negotiations for a trade agreementwith Iraq in 2006 and to establish a permanent delegation office in Baghdad. EU officials say thatthe trade deal aims to stimulate reforms and economic development in Iraq. (23) Several Europeancountries, including France and Germany, have also agreed to help reduce Iraq's foreign debt. TheBush Administration originally called for nearly complete debt forgiveness for Iraq, but France andGermany favored forgiving a lower level of Iraqi debt. They contended that Iraqi debt forgivenessshould be conditioned on the growth of the Iraqi economy; in their view, Iraq has a relativelyfavorable economic outlook, given its large petroleum reserves, in comparison with poorer,debt-ridden, and more needy African countries. In November 2004, France accepted a U.S.-Germancompromise negotiated in the context of the Paris Club to write off 80% of Iraq's foreign debt. (24) Numerous commentators observe that European opposition to the war with Iraq alsostemmed from frustrations with U.S. policy toward the Israeli-Palestinian stalemate. Although EUmembers were divided over Iraq, they have managed to forge a more common position on theIsraeli-Palestinian conflict; many view this EU position as being broadly more sympathetic to thePalestinians. Others assert that the EU posture is balanced between the two sides of the conflict, inpart because some differences among members remain. Successive German governments, forexample, have maintained that they have a special obligation to Israel and have been keen to ensurethat EU policies also promote Israeli security. The EU backs Israel's right to exist and condemnsterrorist acts against Israel. Europeans, however, generally view resolving the Israeli-Palestinian conflict as key toreshaping the Middle East, fostering durable stability, and decreasing the threats posed to both theUnited States and Europe by terrorism and Islamic militancy. The EU's first-ever security strategy,released in December 2003, cites resolving the Israeli-Palestinian conflict as a top EU priority. Many European officials charge that Washington has focused too much on Iraq and has anunbalanced, excessively pro-Israeli policy. In this view, the United States is alienating the broaderMuslim world, which perceives a U.S. double standard at work. European leaders have clamoredfor the United States to "do more" to get Israeli-Palestinian negotiations back on track, preciselybecause they recognize that only sustained U.S. engagement at the highest levels will force theparties to the conflict, especially Israel, back to the negotiating table. (26) European governmentsand EU officials hope that the death of Palestinian leader Yasser Arafat in November 2004 willcreate a new opportunity to resolve the Israeli-Palestinian conflict. Some U.S. observers suggest that Europe's more pro-Palestinian position is motivated by anunderlying anti-Semitism. In support of this view, they point to a spate of attacks on synagogues andother Jewish institutions in Europe, a strong European media bias against Israel, and recentstatements by some European officials criticizing Israel. In January 2004, two Jewish leaderscharged the European Commission with fueling anti-Semitism with its clumsy handling of tworeports. These leaders objected to the Commission's release in November 2003 of an opinion poll,which showed that 59% of the European public considered Israel a threat to world peace, on groundsthat it was dangerously inflammatory. At the same time, they also criticized the Commission's initialdecision to shelve a 2002 study from the EU's racism monitoring center, claiming that the EU fearedit would incite domestic European Muslim populations with its findings that most anti-Semiticincidents in Europe were carried out by disenfranchised Muslim youth. EU officials contend thatthe report was originally withheld because it was poorly written and lacking in empirical evidence. Following its leak to the press, the EU made public this draft report in December 2003. In March 2004, the EU monitoring center released a new study on anti-Semitism in Europe,which it claims is more exhaustive and comprehensive than the original draft study. The March2004 report identified perpetrators of anti-Semitic attacks in Europe as both young, disaffected whiteEuropeans as well as Muslim youth of North African or Asian origin. Some Jewish leaders criticizedthis new study, asserting that it was "full of contradictions" and sought to downplay the extent towhich anti-Semitic attacks in Europe were carried out by Muslim perpetrators. (27) Europeans stress that while these anti-Semitic incidents are troubling, they do not representa broad, resurgent anti-Semitism in Europe. They note that such acts are carried out by individuals,are not state-sponsored, are punished under European law, and are harshly condemned by Europeanpolitical and civic leaders. Many European governments have sought recently to tighten their hatecrime laws and enhance education and prevention programs. In February 2004, EU officials pledgedto take steps to combat anti-Semitism vigorously at a high-level conference on anti-Semitismsponsored by the European Commission. Europeans also stress that criticism of Israel does notequate to anti-Semitism; they admit that such criticism in the European media and political classeshas been fierce recently, but they suggest this reflects the depth of European anger toward IsraeliPrime Minister Ariel Sharon and his policies. Many European leaders deplore Sharon's tacticstoward the Palestinians, believing them to be heavy-handed and counterproductive. They also objectto his leadership of Israel in light of what they consider his history of human rights violations andwar crimes in Lebanon. (28) Historically, a degree of difference has always existed between U.S. and Europeanapproaches to the Israeli-Palestinian conflict. Europeans have traditionally favored a parallelapproach that applies pressure to all sides. This approach also places equal emphasis on the security,political, and economic development agendas that Europeans believe are all ultimately necessary fora lasting peace. European officials stress that the only way to guarantee Israel's security is to createa viable Palestinian state. This is also why the EU has sought to support the Palestinian Authority(PA) financially and to provide humanitarian, development, and reconstruction assistance. The EU is the largest donor of foreign assistance to the Palestinians. The EU and its memberstates together provide nearly $600 million annually to the Palestinians to promote stability,economic development, and reform. Between 2002 and 2005, EU community aid to the Palestinians-- including donations to the World Bank and U.N. agencies -- was roughly $300 million peryear. (29) Officialsmaintain that there is no evidence that any EU money has been diverted for terrorist purposes, andinsist that checks are in place to ensure that EU funds do not sponsor terrorism. They acknowledgethe fungibility of resources, but believe this is best countered by continuing to press the PA to reformits financial management system. (30) In contrast, the United States has more consistently shared the Israeli view that seriousnegotiations can only take place when there is a clear Palestinian commitment to peace, signified bythe end of violence and terrorist activity. The degree to which different U.S. administrations haverigidly adhered to this more sequential approach has varied over the years, but Europeans believethat September 11 reinforced U.S. tendencies to support Israeli positions on the timing of potentialnegotiations because they hardened the Bush Administration's view of the Palestinians. The terroristattacks also allowed Prime Minister Sharon to position himself as a natural U.S. ally in the fightagainst terrorism. Many Europeans believe the Bush Administration has been too easily persuadedby Sharon and too beholden to Israel for domestic political reasons. They point out that theAdministration draws considerable political support from evangelical Christians, who stronglysupport the state of Israel, and has been eager to win over traditionally Democratic Jewishvoters. (31) Despite the difficulties, optimists assert that common ground exists between U.S. andEuropean policies toward the Israeli-Palestinian conflict. EU leaders have been encouraged byPresident Bush's support for a Palestinian state, long advocated by Europeans. Previous U.S.administrations had shied away from endorsing a two-state solution, maintaining that it was for theparties themselves to determine the outcome. EU officials have also welcomed the evolution of thediplomatic "Quartet" of the EU, Russia, the United Nations, and the United States, and its "roadmap"to a negotiated settlement. European leaders did not support Washington's call to replace the lateYasser Arafat as the head of the PA; they viewed Arafat as the democratically-elected Palestinianleader and feared that any viable alternative would only come from more extremist factions. However, they largely agreed with the U.S. assessment that the PA must be reformed. They werepleased with the PA's decision in the spring of 2003 to create a new prime minister position, and theysupport stronger Palestinian institutions such as the legislature and judiciary, as well as measures toguard against corruption and ensure transparency. (32) The EU has welcomed the U.S. Middle East Partnership Initiative (MEPI), which wasunveiled in December 2002 and designed to promote political, economic, and educationaldevelopment throughout the Middle East. Many Europeans viewed the MEPI as complementingthe EU's region-wide development program (the Euro-Mediterranean Partnership) in place since1995 and saw the MEPI as representing a heightened U.S. awareness of the need for a broaderapproach to address Mideast instability. (33) In May 2003, the Bush Administration proposed creating aU.S.-Middle East free trade area by 2013 to further economic development and liberalization in theregion, and promote peace via increased prosperity. This mirrors EU plans to create aEuro-Mediterranean free trade zone by 2010. European officials were also encouraged by initial U.S. steps to revive the peace process inthe immediate aftermath of the war with Iraq. In late April 2003, the Bush Administration madepublic the Quartet's roadmap, following the swearing-in of a new PA Prime Minister. The EU hadbeen pressing for its release since it was finalized by the Quartet in December 2002. In May 2003,the Bush Administration succeeded in swaying Sharon to endorse the roadmap, albeit withreservations. In June 2003, President Bush visited the region and met with Prime Minister Sharonand then-PA Prime Minister Mahmoud Abbas. European officials viewed positively PresidentBush's decisions to set up a U.S. diplomatic team in Jerusalem to monitor implementation of theroadmap, and to designate then-National Security Adviser Condoleezza Rice as his personalrepresentative on Israeli-Palestinian affairs. Since then, however, many Europeans have become frustrated by the lack of progress on theroadmap amid ongoing violence, and they claim that the Bush Administration has not done enoughto cajole the Sharon government into making more concessions for peace. Although theAdministration has criticized Israel for constructing a security fence and at times raised concernsabout some Israeli anti-terrorist tactics such as territorial closures and home demolitions, critics sayWashington has not devoted the sustained attention needed. They stress that the Administration stillremains wedded to the Israeli view that Palestinian terrorism must end before serious steps towardimplementing the roadmap can be taken. They note, for example, that the U.S. monitoring team inJerusalem kept a very low profile (and has largely been withdrawn); as a result, it failed to providethe necessary level of public scrutiny that was supposed to have served as an incentive for both sidesof the conflict to meet their respective obligations under the roadmap. (34) U.S. support for the Sharon government's unilateral "disengagement plan" for the Gaza Stripwas also contentious for European governments and the EU. Although the EU has welcomed Israel'sAugust 2005 withdrawal from the Gaza Strip, some European policymakers remain concerned thatIsrael views its disengagement from Gaza as an alternative to the road map process. They worry thatIsrael's disengagement from Gaza could lead to the creation of a de facto Palestinian state on far lessterritory than that envisaged under the roadmap process. Many Europeans were dismayed by whatthey viewed as a shift in U.S. policy in April 2004, when President Bush appeared to implicitlyendorse Israel's claim to parts of the West Bank seized in the 1967 Middle East war and to limit thePalestinians' right of return to Israel. The EU maintains that it will not recognize any changes to thepre-1967 borders unless such changes are negotiated between the parties. The Bush Administrationcontends that its endorsement of the Sharon plan was intended to jumpstart the stalled peace processand, like the EU, asserts that all final status issues, including the return of Palestinian refugees, muststill be resolved through negotiations between the parties to the conflict. (35) European governments reportedly played a key role in ensuring that the June 2004 G8Summit initiative on the Broader Middle East and North Africa took into account theIsraeli-Palestinian conflict as part of any push to encourage political, economic, and social reformsin the region. European officials criticized initial U.S. versions of this proposal, originally namedthe Greater Middle East Initiative, for failing to tackle the Israeli-Palestinian conflict. TheEuropeans asserted that any attempt to promote reform in the Middle East would be unsuccessfulif not accompanied by simultaneous efforts to resolve this core problem. They also worried that theUnited States might promote the new initiative as an alternative to the stalled Israeli-Palestinianpeace process. While U.S. and European officials overcame their differences and reached acompromise on the Broader Middle East initiative, critics assert that it has little practical significancefor the deadlocked peace process. (36) Shortly after his re-election in November 2004, President Bush asserted in a news conferencewith UK Prime Minister Tony Blair that he intended to "spend the capital of the United States" tocreate a free and democratic Palestinian state during his next term. Many Europeans, however, arguethat the Administration has been slow to seize the opportunity offered by Arafat's death to push fora quick return to Israeli-Palestinian negotiations. U.S. officials appear to favor a more incrementalapproach. They stress that progress in the peace process will depend largely on Palestinian effortsto democratize, reform, and stop Palestinian terrorism. Washington and European capitals welcomed the January 2005 election of Mahmoud Abbas,who is viewed as committed to ending Palestinian terrorism, as the new President of the PalestinianAuthority. U.S. officials believed that Abbas would need time to institute reforms and establishlegitimacy in the eyes of the Palestinian public before engaging in comprehensive final statusnegotiations with Israel. European leaders agree that developing a viable Palestinian state is anecessity, but have continued to urge the United States to take a more active role in resolving theconflict, partly by putting greater pressure on Israel to take steps toward peace also. (37) Some Europeans view U.S. actions since the start of the second Bush Administration asindications that Washington is working more robustly to promote peace between Israel and thePalestinians. European officials welcomed U.S. Secretary of State Rice's trip to the region in earlyFebruary 2005 and her appointment of a U.S. coordinator to oversee Palestinian security reforms. In May 2005, the United States expanded the U.S. coordinator's role to include mediation betweenthe two sides ahead of Israel's departure from Gaza. Also, the EU was pleased with Washington'ssupport for naming a Quartet special envoy in April 2005 to oversee the political and economicaspects of the Israeli withdrawal from Gaza. Most recently, many European policymakers stress that Secretary Rice's direct involvementin brokering a deal between Israel and the Palestinians on security controls for Gaza border crossingsin November 2005 has had an enormous positive impact on European perceptions of the UnitedStates. U.S. and European officials say the agreement will help end Gaza's isolation, promoteeconomic development, and continue to ensure Israeli security. As part of this accord, the EU isassisting with monitoring the Rafah border crossing point between Gaza and Egypt. About 70 EUmonitors are being deployed to Rafah to provide expert advice and training to Palestinian police andcustoms officers, as well as to allay Israeli concerns that militant leaders or weapons may slip intoGaza through Rafah. (38) In January 2006, the EU also plans to establish a small Palestinian police training andadvisory mission and will send a mission to monitor the upcoming Palestinian legislative electionsthat same month. Although Hamas is listed on the EU's proscribed terrorist list, the EU hasannounced that the monitoring mission will be permitted to have limited contact with Hamascandidates on technical electoral matters. Like the EU, the Bush Administration has called onHamas and all other Palestinian factions to renounce violence but has not backed Israel's call toexclude Hamas from the elections, asserting that the elections are "a Palestinian process." (39) Observers note that these EU missions, especially the one at Rafah, are also an opportunityfor the EU to demonstrate that the Union can be a serious and responsible political player in theregion. At the same time, many in the EU maintain that ultimately, progress toward a long-termpeace is impossible without U.S. leadership. Some Europeans may remain disappointed with thedegree of U.S. engagement. They assert that the Bush Administration still favors a low-key approachto its role in promoting peace in the Middle East. Most analysts believe that further progress in thepeace process will have to await the outcome of Israel's parliamentary elections in March 2006. (40) U.S.-European relations over Iran have experienced a number of ups and downs over the lastdecade. Both sides of the Atlantic share similar goals with respect to Iran: encouraging reforms anda more open society less hostile to Western interests, ending Iranian sponsorship of terrorism againstIsrael, and combating Tehran's efforts to acquire WMD. However, policies have often differedsharply. The views of EU members on Iran have tracked fairly closely, thereby producing broadagreement on a common EU approach inclined toward "engagement." In contrast, the United Stateshas traditionally favored isolation and containment. U.S.-EU frictions over Iran peaked in 1996 withthe passage of the U.S. Iran-Libya Sanctions Act (ILSA), which seeks to impose sanctions on foreignfirms that invest in Iran's energy sector. EU officials oppose what they view as ILSA'sextraterritorial measures and contend that ILSA breaches international trade rules. Tensions eased,however, as U.S. policy began to edge closer toward engagement following the 1997 election ofrelative moderate Mohammad Khatemi as Iran's president, and the conclusion of a U.S.-EUagreement to try to avoid a trade dispute over ILSA. In 2002 and early 2003, U.S.-EU differences on Iran appeared to widen again. In January2002, President Bush included Iran as part of an "axis of evil" in his State of the Union messagefollowing allegations of an Iranian arms shipment supposedly destined for the West Bank and GazaStrip, and revelations of two previous undeclared Iranian nuclear facilities. Iran insists that itsnuclear program is for peaceful, energy-related purposes, but Washington increasingly believes thatIranian nuclear activities are also aimed at producing nuclear weapons. At the same time, the BushAdministration had been growing disenchanted with the prospects for internal Iranian politicalreform. In July 2002, President Bush issued a statement supporting Iranians demonstrating forreform and democracy, which was widely interpreted as a shift in U.S. policy; experts believed itsignaled that Washington had concluded that Khatemi and his reformist faction would not be ableto deliver political change and that engaging with the Khatemi regime would be fruitless. AfterSaddam Hussein was ousted from power in Iraq in 2003, some U.S. officials also began suspectingIran of fomenting unrest among Iraq's long-repressed Shiites. (42) In contrast, European leaders continued to hold out hope for the reformers within Khatemi'sgovernment, and maintained that "the glass was half full." They stressed, for example, what theyviewed as a positive Iranian role in the campaign against the Taliban, Khatemi's success in distancingthe government from the fatwa against British writer Salman Rushdie, and Iran's efforts to combatdrug smuggling. They largely viewed the alleged arms shipment to the Palestinians and Iraniansupport for terrorist groups as the last gasps of a hardline Islamic foreign policy managed by clericalfactions. These optimists also argued that Iran was not seeking nuclear weapons to use against Israelor the West, but rather to burnish its image as a regional power, and that Tehran's weapons programcould still be curtailed. (43) The EU believed that its "conditional engagement" policy would help bolster the reformersin Khatemi's government. In December 2002, the EU launched negotiations on a trade andcooperation agreement with Iran, and a separate but linked political accord promoting EU-Iraniandialogue on human rights, non-proliferation, and counterterrorism. Although some observersquestioned how tight the linkage between these economic and political strands of the EU's strategywould be, EU officials insisted that there would be no progress on the trade pact without equal andparallel progress on the political accord. Europeans rejected U.S. criticisms that they were puttingcommercial interests ahead of security concerns. As one EU official put it, "we're not doing this forpistachios." (44) EU-Iranian trade pact negotiations were effectively suspended in the summer of 2003,however, as the EU grew increasingly frustrated with Iran's slow pace on political reforms and itsongoing human rights violations. Heightened EU worries about the nature of Iran's nuclear programand its lack of compliance with International Atomic Energy Agency (IAEA) safeguards alsocontributed to the stalemate on the trade pact. EU members had high hopes for an October 2003 dealbrokered with Iran by the UK, France, and Germany (the "EU3"); Iran agreed to accept intrusiveinternational inspections of its nuclear facilities, and to suspend production of enriched uranium atleast temporarily, in exchange for promises of future European exports of nuclear energy technology. But this deal soon faltered. The Europeans viewed Iran as dragging its feet in complying with IAEArequirements and were angered by Iran's decision in July 2004 to resume building nuclearcentrifuges. Since then, some observers argue that EU members have taken a harder line on Iran's nuclearactivities, backing several resolutions with the United States rebuking Iran for its lack of cooperationwith the IAEA. A number of analysts suggest that the EU's tougher stance on Iran stems from itsnew WMD policy, agreed in June 2003, that seeks to strengthen the IAEA and calls for exertingconsiderable political and economic pressure on potential proliferators. At the same time, manypoint out that the United States has also demonstrated a new willingness to compromise with itsEuropean partners on Iran. Although Washington has continued to push the IAEA to threaten Iranwith U.N. sanctions, U.S. officials have not actively opposed the more moderate, incentive-basedapproach advocated by European governments. Many pundits speculate that both Europe andWashington have been eager to avoid another large diplomatic row so soon after Iraq. (45) Nevertheless, Washington remained cautious about Iran's intentions, and some U.S.policymakers worried that European leaders were being too lenient. In September 2004, Washingtonadvocated another IAEA resolution that would have set October 31, 2004, as a firm deadline for Iranto suspend all enrichment activities and to dispel remaining doubts about the nature of its nuclearprogram. The United States also wanted a clear "trigger mechanism" that would automatically referIran to the U.N. Security Council -- where it could face trade sanctions -- if it did not comply by thedeadline. Washington backed down on these demands, however, because of a lack of support fromEuropean and non-European IAEA members. European governments argued that the threat ofsanctions would reduce their negotiating leverage and harden Iran's position about its need fornuclear weapons. In November 2004, the UK, France, and Germany brokered a new deal with Iran aimed atending activities that could lead to nuclear weapons production in exchange for promises of civiliannuclear technology and political and trade incentives. Iran claims it agreed to voluntarily andtemporarily suspend its uranium enrichment work as an act of good faith. In mid-December 2004,Iran and the EU3 opened negotiations on a long-term agreement on nuclear, economic, and securitycooperation as part of the deal. The EU also resumed its negotiations with Iran on a trade andcooperation agreement in January 2005 as part of this process. EU3 officials hoped that they couldconvince Iran to make a strategic decision to forego acquiring nuclear weapons in return for trade,aid, and security rewards. Washington remained skeptical about the chances of success of the EU3 approach. U.S.policymakers believed that Iran was using the negotiations process offered by the EU3 to play fortime and likely continuing its work on a covert nuclear weapons program. Meanwhile, Europeansurged greater U.S. engagement with Iran, believing that the absence of the United States from thenegotiating table was limiting their ability to deliver on some of the most ambitious rewardsdiscussed with the Iranians, such as supporting Iranian membership in the World Trade Organization(WTO). Washington had repeatedly blocked Iranian attempts in the WTO to open accessiontalks. (46) European governments continued to promote U.S. engagement with Iran in order to bolsterthe EU3's negotiating position. In March 2005, the Bush Administration agreed to offer limitedeconomic incentives if Iran agreed to cooperate with the EU3 on nuclear matters. The incentivesincluded facilitating Iranian access to spare airplane parts for its aging commercial fleet and droppingobjections to beginning WTO accession negotiations with Iran, which Washington did in May 2005. In return, the EU3 pledged to pursue punitive U.N. measures if negotiations with Iran failed. TheBush Administration stressed that the incentives offered to Iran were not a reward for the Iraniansbut rather were meant to demonstrate the U.S. commitment to improving relations with Europe andU.S. backing for the EU3's efforts to curb Iranian nuclear ambitions. (47) The EU3's discussions with Iran on a permanent nuclear agreement, however, began to breakdown ahead of Iran's June 2005 elections, which resulted in the election of hardliner MahmoudAhmadinejad as president. The EU3's negotiations with Iran have been effectively stalled sinceAugust 2005, following Iran's resumption of uranium conversion, an early stage in the nuclear fuelcycle. In accordance with their March 2005 pledge, the EU3 have been working with the UnitedStates on an International Atomic Energy Agency (IAEA) resolution that would refer Iran to the U.N.Security Council. This resolution, however, has run into opposition from many IAEA members,including Russia, China, and India. In September 2005, the United States and the EU3 succeededin convincing a slim majority of the IAEA's 35 board member countries to pass a resolution findingIran in non-compliance with the Non-Proliferation Treaty and to refer Iran to the U.N. SecurityCouncil, but did not set a timeline or firm date for such a referral. In November 2005, the UnitedStates and EU3 decided against pushing for another IAEA vote to refer Iran to the Security Council,given a lack of support within the IAEA for doing so at that time. Instead, the United States and the EU3 have thrown support behind a Russian proposal inwhich Iranian uranium would be enriched at a facility in Russia and then returned to Iran for civilianuse. Iran has rejected this offer, insisting that it has the right to perform uranium enrichment insideIran. On November 27, 2005, the EU3 offered to hold an exploratory meeting with Iran to see ifthere was "enough common basis" to restart negotiations with Iran on its nuclear program and theRussian compromise proposal. The EU3 insists that it will not resume formal negotiations with Iranuntil Iran re-suspends its uranium conversion work. (48) Washington hopes that Iran will return to the negotiating table with the EU3 but has alsofloated the idea publicly that European and other concerned countries consider curbing their tradeand investment relations with Iran if talks fail to convince Iran to abandon its nuclear ambitions. Some observers suggest that President Ahmadinejad's public statements calling the Holocaust a"myth" and for Israel to be "wiped off" the map may make any EU3-Iranian negotiations over nuclearmatters more difficult and strengthen European resolve to push for a U.N. Security Council referralor other diplomatic or economic sanctions on Iran. At the same time, many Europeans remainconcerned that Washington may ultimately conclude that diplomacy has failed to address the Iraniannuclear threat and that a military option should be considered against Iranian nuclear sites. (49) As with Iran, European policies toward Syria have traditionally been more inclined towardengagement than containment or isolation. Several European countries have long-standing, historicrelationships with Syria, and cooperation between the EU (as an entity) and Syria dates back to thelate 1970s. The EU is a major trading partner for Syria. Syria has participated in the EU'sEuro-Mediterranean Partnership program since its start in 1995. The development of closerEU-Syrian relations has been stymied by EU concerns about the seriousness of Syria's commitmentto undertake political and economic reforms and protect human rights. In October 2004, Syria andthe EU concluded negotiations on a long-delayed Association Agreement, which sets out a newframework for relations in the context of the Euro-Mediterranean Partnership. The Agreementcovers trade and foreign aid, includes provisions on respect for human rights and democraticprinciples, and seeks to promote Syrian cooperation in countering terrorism and the proliferation ofweapons of mass destruction. The Agreement has not yet been ratified, however, by the EU. In contrast, U.S.-Syrian relations have been largely frosty for decades, and Washington hasimposed a range of political and economic sanctions on Syria. In the immediate aftermath of the warwith Iraq, some Europeans were alarmed by U.S. warnings to Syria over its alleged chemicalweapons program and its support for terrorist groups (including radical Palestinian factions and themilitant Lebanese Shi'ite Muslim group Hizballah) and U.S. accusations that Syria was not doingenough to stop the flow of Islamic militants and former Iraqi Baathists into Iraq. Somecommentators worried that U.S.-European differences over Syria could become another difficultflashpoint in the transatlantic relationship. The EU and some European governments, however, appear to have hardened their views ofSyria recently. The conclusion of the Association Agreement was delayed for almost a year becauseof Syria's reluctance to sign up to the WMD clause. And France for the past several years has beenincreasingly vocal about its concerns regarding Syria's 14,000-strong military presence in Lebanonand its heavy involvement in Lebanese politics. France, the former colonial power in Lebanon, hascome to view Syria's dominance of Lebanese politics as a de-stabilizing influence and has beenfrustrated by the lack of internal political reform within Syria. In early September 2004, France andthe United States co-sponsored a U.N. Security Council resolution calling on all foreign forces inLebanon to withdraw and for an end to foreign influence in Lebanon's political system, although itdid not mention Syria by name. The EU in December 2004 essentially endorsed this U.N. resolution,which also called for the disbandment of armed groups in Lebanon, such as Hizballah, which hasties to Syria. The assassination of former Lebanese Prime Minister Rafik Hariri and 22 others in February2005 helped galvanize U.S.-European cooperative efforts to pressure Syria to withdraw all itsmilitary and intelligence personnel from Lebanon. Many suspect Syrian involvement in theassassination, although Syria has denied these allegations. Washington and Paris led the effort toencourage Syria's withdrawal from Lebanon. The EU echoed these demands. The EuropeanParliament warned that Syria's failure to comply with the September 2004 U.N. resolution couldendanger the ratification of the EU-Syrian Association Agreement. The Agreement's ratificationappears to be on hold pending the outcome of the U.N. investigation into the death of Hariri andSyria's alleged involvement. (51) In late March 2005, Syria announced it would withdraw all of its military and intelligencepersonnel from Lebanon; Syria claimed these withdrawals were completed by April 26, 2005. TheUnited Nations has since verified that there is no significant Syrian military or intelligence presenceremaining in Lebanon. Many in the United States and Europe, however, remain concerned that Syriais not fully cooperating with the U.N. investigation into the Hariri assassination and that Syrianofficials maintain undue influence through their extensive contacts in the Lebanese bureaucracy andsecurity services. U.S. and European leaders have also expressed alarm at the series of violentattacks on several prominent anti-Syrian political and media leaders in the months following Hariri'sdeath. On October 31, 2005, the United Nations Security Council unanimously passed a resolution-- co-sponsored by the United States, Britain, and France -- calling on Syria to cooperate fully withthe U.N. investigation into the Hariri killing or face unspecified "further action." The resolution'ssponsors decided against pressing for a threat of clear economic sanctions at that time to gain thesupport of Russia, China, and other Security Council members and maintain a united internationalfront. On December 15, 2005, the U.N. Security Council passed another resolution citing Syria forits continued lack of full cooperation with U.N. investigators, extending for another six months theU.N. probe and authorizing U.N. officials to provide technical assistance to Lebanese authoritiesinvestigating other political killings in which some believe Syria may have been involved. (52) Some analysts question, however, how sustainable U.S.-European cooperation on Syria willbe in the longer term. The United States may be more inclined than France or other EU memberstates to press for punitive measures against Syria sooner rather than later. Another keyU.S.-European division remains the EU's reluctance to add Hizballah -- which is based in Lebanonbut backed by Syria and Iran -- to the EU's common terrorist list. While Washington considersHizballah a terrorist group that supports violence against Israel, some EU members have longresisted U.S. and Israeli entreaties to add Hizballah to the EU's blacklist on grounds that it alsoprovides needed social services and is considered by many Lebanese as a legitimate political force(members of Hizballah have been elected to Lebanon's parliament). France, among other EUmembers, believes that adding Hizballah to the EU's common terrorist list would becounterproductive and could intensify Lebanon's political turbulence. (53) Since September 11, 2001, U.S. and European officials have sought to present a united frontagainst terrorism. Most European governments have cooperated closely with U.S. law enforcementauthorities in tracking down terrorist suspects and freezing financial assets. Many have tightenedtheir laws against terrorism and sought to improve their border control mechanisms. Moreover, theSeptember 11 attacks have given new momentum to EU initiatives to boost police and judicialcooperation both among member states and with the United States to better combat terrorism andother cross-border crimes. The March 11, 2004, terrorist bombings in Madrid, Spain furtherenergized EU law enforcement efforts against terrorism. The terrorist attacks on London's masstransport system in July 2005 have also prompted additional EU efforts to bolster law enforcementand intelligence cooperation and have focused increased European attention on the need to combatIslamist recruitment and radicalization in Europe. (54) Some differences in U.S. and European approaches to counterterrorism exist and havebecome more evident as Washington has broadened the war against terrorism beyond Al Qaeda andAfghanistan. Most EU members continue to view terrorism primarily as an issue for lawenforcement and political action rather than a problem to be solved by military means. ManyEuropean officials and governments are uncomfortable with the Bush Administration's tendency toequate the war in Iraq with the war on terrorism. The past experiences of several European countries in countering domestic terrorists, suchas the Irish Republican Army in the UK or the Basque separatist group ETA in Spain, also colorperceptions. Many Europeans have drawn the lesson that relying on the use of force does not workand only serves to alienate "hearts and minds." Europeans are increasingly worried that the UnitedStates is losing the battle for Muslim "hearts and minds" not only because of the war with Iraq andWashington's traditional support for Israel but also because of U.S. decisions that some chargeviolate human rights, such as detaining suspected Al Qaeda terrorists at GuantÃ¡namo Bay. Europeans were deeply dismayed by the Abu Ghraib prison scandal in Iraq; critics charge that it hasseriously damaged U.S. credibility in both the Middle East and in Europe. The 9/11 Commissionrecognized that allegations of U.S. prisoner abuse "make it harder to build the diplomatic, political,and military alliances" that the United States needs in order to combat terrorism worldwide. The EUand judicial officials and parliamentarians from several EU member states have also expressedconcerns about a November 2005 Washington Post news report of alleged "secret" CIA prisons forterrorist suspects in some eastern European countries and the possible use of some European airportsas transit points for U.S. flights transporting abducted terrorist prisoners. (55) Many Europeans believe that although good law enforcement and intelligence capabilitiesare essential, efforts against terrorism will only be successful, ultimately, if equal attention is paidto addressing the political, social, and economic disparities that often help foster terrorist violence. European leaders were initially skeptical of the U.S.-proposed Broader Middle East initiative,however, because they worried that it sought to democratize the Middle East and impose Westernvalues. Although Europeans would agree that a more democratic Middle East would help promotepeace and stability, many doubt that it can be dictated from the outside and are uncomfortable withattempts to do so because to them, it smacks of colonialism and a religious fervor. Some Europeansalso worry that introducing democracy into Arab countries could lead to anti-Western factions ormilitant Islamists winning elections. Thus, some Europeans suggest a more nuanced,country-by-country approach to the region that would seek to identify reformers and work with themto try to effect change and stem terrorism. (56) The compromise ultimately reached by the United States with key European governmentsand others on the Broader Middle East initiative emphasizes regional partnerships and seeks toencourage political reform and social and economic development from within Middle Easternsocieties. The 9/11 Commission welcomed this initiative as a potential starting point for a dialogueabout reform between the Muslim world and the West. Skeptics doubt, however, the extent to whichthe new initiative will truly provide a vehicle for U.S.-European cooperation in the region. Theyassert that each side of the Atlantic will likely continue to engage in the region through its ownexisting policy instruments, such as the U.S. Middle East Partnership Initiative and the EU'sEuro-Mediterranean Partnership. (57) Provisions in the Intelligence Reform and Terrorism PreventionAct of 2004 ( P.L. 108-458 ) seek to promote Middle East development and reform and improveinternational collaboration against terrorism. Another point of U.S.-EU friction centers on definitional differences of what constitutes aterrorist. Several commentators suggest that the EU has been slower to name several organizationsto its common terrorist list because some members view certain groups as more revolutionary thanterrorist in nature. The EU has also been more inclined to distinguish between the political andmilitary wings of the same organization, such as Hamas; although the EU terrorist list includedHamas' military wing since its first iteration in December 2001, the political wing was not addeduntil September 2003. Some EU members had argued that Hamas' political wing provided crucialsocial services in the West Bank and Gaza, and worried that listing it would only further inflame theIsraeli-Palestinian conflict. The EU has been unable to reach agreement, however, on adding relatedcharities or individuals suspected of raising money for Hamas to its list. As mentioned above, EUmember states also remain divided on how to treat Hizballah for similar reasons, despite increasingU.S. and Israeli pressure to include the organization on its common terrorist list. Some analysts are concerned that U.S.-EU cooperation against terrorism -- as well as broaderWestern-Arab cooperation -- could be negatively affected in the future by other contentious Mideastissues. They suggest that European domestic opposition to U.S. policies in the Middle East couldundermine the determination of some European governments to tighten their anti-terrorist laws, orto extradite suspected terrorists to the United States. Others dismiss such concerns. They stress thatEurope remains vulnerable to terrorist attacks, and law enforcement cooperation serves Europeanas well as U.S. interests. They also point out that despite the rift over Iraq, U.S.-EU efforts againstterrorism continue. For example, in June 2003, the EU and the United States signed two treaties onextradition and mutual legal assistance to help harmonize the bilateral accords that already exist, andpromote better information-sharing. Some Europeans remain worried that U.S. actions in Iraq andthe continuing Israeli-Palestinian conflict could weaken Arab countries' resolve to cooperate in thefight against terrorism -- a factor that is often crucial to the success of U.S. and Europeancounterterrorism efforts. (58) The Bush Administration views the Middle East as a key area from which two dominantthreats, terrorism and WMD, emanate. The Administration asserts that these threats must beconfronted to ensure U.S. national security, and argues that greater peace and stability in the regionwill only be possible once these twin threats are eliminated. Many officials criticize thecounterterrorist policies of the previous Clinton Administration as being too weak, which theybelieve contributed to Al Qaeda's sense of impunity. For the Bush Administration, September 11"changed everything" about dealing with regimes that possess WMD because of the risk that theycould supply such weapons to terrorists. (59) The Administration remains convinced that Al Qaeda is eagerto acquire WMD capabilities, and is vexed by what it views as much of Europe's strategic myopiatoward this threat. Although pleased with EU and bilateral European police, judicial, andintelligence cooperation against terrorism, Administration officials claim that law enforcement aloneis not always a sufficient tool, especially for countering WMD proliferation. Moreover, the Bush Administration maintains that removing Saddam Hussein from powerwas a necessary first step on the road to peace and stability in the region. U.S. officials say itdeprives Palestinian-related terrorist networks of a vocal patron who exploited the Israeli-Palestinianconflict for self-serving purposes. They also hope that the display of U.S. power will help promptIran and Syria to forego acquiring WMD and stop supporting anti-Israeli terrorist groups. The BushAdministration remains deeply concerned about Iran's nuclear ambitions and possible progress ona nuclear weapons program, asserts that all options remain on the table, but that it is committed totrying to resolve differences with Iran diplomatically. U.S. officials maintain that they welcome andsupport the EU3's efforts to curb Iranian nuclear aspirations. Washington insists it fully supports a peaceful settlement of the Israeli-Palestinian conflictand the broader effort toward Middle East peace, but also maintains that no permanent peace ispossible without an end to terrorism. The Bush Administration hopes that Arafat's death offers anew opportunity for Palestinians to pursue democratic reforms and a negotiated settlement to theconflict. To help foster greater peace and stability in the Middle East, the Administration has also setits sights on promoting more democratically accountable governments. U.S. officials reject thearguments of European skeptics who say this is not feasible; they point out that the same doubts wereraised after World War II about the ability of Germany and Japan to sustain democratic values. Some U.S. commentators suggest that European governments have been slow to address thedemocratic deficit in the Middle East because they fear doing so would impede their relations withArab states and negatively affect their commercial interests. They believe that the Broader MiddleEast Initiative has forced European governments to grapple with the need for political, economic,and social reform in the region and assert that encouraging reforms should not be held hostage toprogress on the Israeli-Palestinian conflict. As for charges that Washington's pursuit of war with Iraq has damaged the credibility ofmultilateral institutions such as the United Nations and NATO, Administration officials argue thatthe blame lies with France, Germany, and others. In February 2003, President Bush stated that,"High-minded pronouncements against proliferation mean little unless the strongest nations arewilling to stand behind them." Administration officials claim that countries such as France thateffectively blocked a second U.N. resolution explicitly authorizing force against Iraq have weakenedthe United Nations by exposing it as a paper tiger, lacking in authority and power. U.S. critics alsoassert that Paris is keen to promote the United Nations because some of France's self-image as aleading international power derives from its permanent seat on the Security Council. Some suggestthat France and other European countries are eager to keep Washington engaged in multilateralinstitutions because this helps constrain U.S. power and influence. U.S. officials also accuse France,Germany, and Belgium of causing strains within the NATO alliance by blocking for several weeksin early 2003 the deployment of NATO military assets to Turkey to help defend it against a possibleattack from neighboring Iraq. (60) Bush Administration views toward the EU as an actor in the Middle East appear mixed andvary issue by issue. Official U.S. policy supports EU efforts to develop a common foreign andsecurity policy in the hopes that a Europe able to speak with one voice will be a better, moreeffective partner for the United States. Some point to the EU's participation in the Quartet as a keyexample. Other U.S. strategists worry, however, that the position taken on Iraq by some EUmembers, especially France, is motivated by its desire to see the EU evolve into a counterweight tothe United States. They caution that the evolution of more common EU policies could decrease U.S.influence in Europe and widen the gap between the two sides of the Atlantic. A number ofEuropeans were alarmed by Secretary of Defense Donald Rumsfeld's statement splitting Europeanallies into "old" and "new" because they believe it could be indicative of the desire of some inWashington to keep Europe weak and divided. Many EU officials also assert that while France maybe a leading player in the EU, the majority of EU member states and candidate countries reject theFrench notion that Brussels should seek to balance Washington. (61) Congress actively supported U.S. efforts to contain Iraq. Like the Administration, someMembers of Congress expressed serious concerns about the behavior of several European allies inNATO and at the United Nations. France and Germany have borne the brunt of Congressionalcriticisms. In the spring of 2003, some Members proposed sanctions against French imports suchas wine and water, and ending U.S. military contracts with certain French-owned corporations. Others, however, suggested that such actions would negatively affect U.S. subsidiaries of Frenchcompanies and U.S. jobs. H.Amdt. 55 (proposed April 3, 2003 by Representative MarkKennedy) to the wartime supplemental funding measure ( H.R. 1559 , P.L. 108-011 )called for prohibiting the use of Iraq reconstruction funds to purchase goods or services from Franceand Germany, among others; although H.Amdt. 55 passed the House, it was deletedfrom H.R. 1559 as enacted. (62) Many Members are also concerned with possible next steps in the Middle East peace process. Congress remains a strong supporter of Israel and is dismayed by ongoing Palestinian terrorism. Numerous Members view the Quartet's roadmap cautiously, and warn the Administration that noserious negotiations should be pursued until Palestinian violence against Israel stops. Following theJanuary 2005 Palestinian elections, however, both the House and Senate passed resolutionscommending the election results (see H.Res. 56 , introduced by Representative RoyBlunt, passed February 2, 2005, and S.Res. 27 , introduced by Senator William Frist,passed February 1, 2005). Like the Administration, Members of Congress have welcomedMahmoud Abbas as the new President of the PA but also urged him to advance reform and endPalestinian terrorism. (63) Some Members of Congress also continue to demand greater political and economicaccountability before giving any financial assistance to the PA. In January 2005, the BushAdministration proposed $350 million in aid for Palestinian democracy and security programs in itssupplemental budget request. The FY2005 Supplemental Appropriations Act ( P.L. 109-13 ) provideda total of $275 million in response to the President's request, but Congress specified that $50 millionof the funds be used to assist Israel in easing Palestinian movements and that $5 million beearmarked to evaluate the PA's accounting procedures and audit its expenditures. The FY2006foreign operations appropriations act ( P.L. 109-102 ) passed in November 2005 provides $150million for the West Bank and Gaza Strip. (64) Furthermore, Congress continues to eye Iran warily. The United States has imposed a widevariety of economic sanctions against Iran since 1979. Many are aimed at curbing Iranian supportfor terrorism and Iran's WMD aspirations. In August 2001, Congress renewed the Iran-LibyaSanctions Act for another five years ( P.L. 107-24 ). Members of Congress also continue to discussways to encourage regime change and promote democracy in Iran. For both FY2004 and FY2005,Congress appropriated respectively up to $1.5 million (in P.L. 108-199 ) and $3 million (in P.L.108-447 ) for democracy promotion activities in Iran. For FY2006, Congress appropriated up to $10million in democracy promotion funds for use in Iran (in P.L. 109-102 ). In January 2005,Representative Ileana Ros-Lehtinen introduced H.R. 282 that seeks to strengthen ILSAand recommends providing new U.S. aid to pro-democracy groups in Iran. A companion bill, S. 333 , with similar provisions was introduced in February 2005 by Senator RickSantorum. (65) The United States also maintains a number of economic sanctions on Syria. In November2003, Congress passed H.R. 1828 (introduced in April 2003 by Representatives IleanaRos-Lehtinen and Eliot Engel) and President Bush signed the bill as P.L. 108-175 ; it calls for additional sanctions until Syria stops supporting terrorism, ends its occupation of Lebanon, and haltsefforts to develop WMD. The Bush Administration initially worried this legislation mightundermine the Middle East peace process, threaten Syrian cooperation in the U.S. war againstterrorism, and create another point of contention with the EU. The Administration dropped itsobjections to H.R. 1828 in October 2003 following escalating tension between Israel andSyria and allegations that Syria had allowed Arab volunteers bent on attacking U.S. forces to crossinto Iraq. President Bush imposed sanctions in accordance with P.L. 108-175 in May 2004 that banmany U.S. exports to Syria and prohibit Syrian aircraft from flying to or from the United States. (66) Members of Congress expressed serious concerns over the assassination of former LebanesePrime Minister Hariri and called for Syria to withdraw its military forces and intelligence personnelfrom Lebanon. S.Res. 63 (introduced by Senator Joseph Biden) to this effect was passedon February 17, 2005. Some Members are displeased with Syrian actions that they view as hinderingthe U.N. investigation into Hariri's death (see H.Res. 510 introduced by RepresentativeRobert Wexler on October 25, 2005, and H.Res. 598 introduced by RepresentativeDarrell Issa on December 14, 2005). And many Members also remain concerned with the absenceof Hizballah on the EU's common terrorist list. H.Res. 101 (introduced byRepresentative Jim Saxton on February 15, 2005), which urges the EU to add Hizballah to itscommon terrorist list, was passed on March 14, 2005. A similar measure, S.Res. 82 (introduced by Senator George Allen on March 15, 2005), passed on April 29, 2005. Historically, U.S.-European relations have experienced numerous ups and downs. Pro-Atlanticists have always stressed in times of tension the underlying solidity of the transatlanticrelationship given its basis in common values and shared interests. Even without the Soviet threatto bind the two sides of the Atlantic together, many observers note that the United States and itsEuropean allies and friends face a common set of challenges in the Middle East and elsewhere, andhave few other prospective partners. Conventional wisdom has dictated that whatever frictions existin the relationship merely represent disagreements among friends characteristic of U.S.-European"business as usual." However, many analysts worry that the transatlantic relationship is fraying. They questionthe Bush Administration's commitment to partnership with Europe in light of disagreements overthe Middle East and other trade and foreign policy issues. Europeans assert that Washingtonimported disagreements over Iraq into NATO with little concern for the consequences of suchactions for the alliance, which has been the cornerstone of European security for the last half-century. Meanwhile, U.S. critics see little value in trying to bridge U.S.-European policy gaps given thelimited military capabilities of most European countries to contribute to U.S. operations aimed atreducing the threats posed by terrorism and WMD proliferation. Some European officials also resent that U.S. policies toward Iraq exposed divisions amongEU members at a time when the EU has been seeking to shape its future structure and forge a morecommon foreign and security policy. A number of observers suggest that this is a key reason whythe transatlantic quarrel over Iraq was divisive. The internal EU clashes over Iraq were in partindicative of a broader power struggle among and between EU member states and EU candidatesover the future of the Union -- in particular, the future shape of CFSP and who speaks for Europe,as well as what kind of relationship the EU desires with the United States. Despite several commonEU statements in January and February 2003 calling on Iraq to disarm, experts contend thesepronouncements only papered over differences on the use of force, and represented the lowestcommon denominator of EU opinion. Many analysts say the true depth of the EU rift over Iraq was exposed by the January 30,2003 decision of five EU members and three aspirants to publicly call for unity with Washington onIraq, which was followed by a similar declaration by seven other EU candidates and three Balkancountries with EU aspirations. The lack of prior consultation on these statements with Brussels orAthens, holder of the EU's rotating Presidency at the time, outraged Paris and some other EUcapitals. French President Jacques Chirac publically blasted the EU candidates, stating that theywere "badly brought up" and had "missed a good opportunity to keep quiet." (67) Some attribute Chirac's outburst to fears of dwindling French influence over CFSP'sdevelopment as the EU expands to include central and eastern European states that Paris perceivesas more pro-American. (68) Many new EU member states still view the United States as theultimate guarantor of European security. Although some new EU members may have privatelyshared French and German concerns about U.S. actions in Iraq, they viewed the crisis as a strategicchoice between the United States and Saddam Hussein, and calculated that the Iraqi regime was notworth putting good relations with Washington at risk. At the same time, then-EU candidates weredismayed by U.S. Defense Secretary Donald Rumsfeld's comments in February 2003 that dividedEurope into "old" (countries that opposed the U.S.-led invasion of Iraq) and "new" (countries thatsupported it) given their desires to join "a Europe whole and free." Other experts also attribute thestatements supporting the U.S. stance on Iraq to a rebellion by smaller EU members and aspirantsto French-German attempts to reassert themselves as the key drivers of the EU agenda. (69) Since the end of major combat operations in Iraq, European and EU officials have beenseeking to mend fences, both within the EU and between Europe and the United States. Someobservers suggest that the internal EU rift over Iraq may have reinvigorated EU efforts to build CFSPin order to avoid similar bitter internecine disputes in the future. In May 2003, EU foreign ministerstasked the EU's High Representative for CFSP, Javier Solana, with developing an EU securitystrategy to identify common EU security interests and joint policy responses; this new, first-ever EUsecurity strategy was officially approved in December 2003. At the June 2003 EU summit in Greece, EU leaders attempted to portray the EU as a reliablepartner that also recognizes the significant threats posed by terrorism, WMD, and failed states. U.S.policymakers reportedly welcomed the EU's new WMD doctrine, agreed at the Greece summit, andits threat to use "coercive measures" as a last resort, asserting that it marked a "new realism" in theEU. (70) Also in June2003, the United States and the EU issued a joint statement in which they pledged closer cooperationto better combat the spread of WMD. At the June 2004 U.S.-EU summit in Ireland, both sidessought to portray the transatlantic dispute over Iraq as being firmly behind them and stressed theimportance of the U.S.-EU partnership. The Bush Administration asserted that it would make mending transatlantic relations -- inboth NATO and the EU -- a priority in its second term. Europeans welcomed these efforts andresponded positively to President Bush's and Secretary Rice's trips to Europe in February 2005. Many believe they have gone a long way toward improving the atmospherics of the relationship andthat the discussions between President Bush and key European leaders have helped to narrow somedifferences over how to manage Iran and Syria. Despite these hopeful signs, skeptics assert that the wounds from the clash over Iraq have notfully healed and U.S. and European policies still diverge on many issues. Several factors will likelyinfluence how deep and lasting the damage from the dispute over Iraq and subsequent policies in theMiddle East will be to the broader transatlantic relationship. One key determinant will be whetherthe United States and its European allies and friends can cooperate more robustly in the future inrebuilding Iraq. Another factor likely to affect the shape of the future transatlantic relationship maybe whether the Europeans perceive a renewed commitment by the United States to engage in asustained effort to revive Middle East peace negotiations. Furthermore, observers note that the overall transatlantic relationship would furtherdeteriorate if recriminations over Iraq or policy differences on other Middle East issues were toweaken NATO or impede the EU's efforts to forge a deeper and wider Union. Some worry thatWashington has lost confidence in NATO as a result of the failure of France, Germany, and Belgiumto clearly and quickly support their fellow ally Turkey as the conflict with Iraq loomed. They believethis incident will reinforce those in the Administration already inclined to marginalize NATO,viewing it at best as a hedge against a resurgent Russia and as a stabilizing element in the Balkans. Some also suggest that the crisis over Iraq emboldened France to renew its efforts to develop aEuropean defense arm independent of NATO and the transatlantic link. They point to the April 2003meeting of French, German, Belgian, and Luxembourg leaders to discuss creating a Europeanmilitary headquarters. This initiative was scaled back in December 2003, but some experts believethat the EU agreement to enhance its existing military planning capabilities may be the first step indriving the transatlantic alliance apart -- despite the fact that EU leaders also agreed to set up an EUplanning cell at NATO and will accept NATO liaison officers at the EU to ensure transparency andcooperation between the two organizations. Over the last several years, some Europeans worried that the Bush Administration -- in partbecause of U.S.-European differences over Iraq and other contentious Middle East issues -- was keento keep Europe weak and divided in order to preserve U.S. leverage on individual EU member states. They feared that Secretary Rumsfeld's comments about "old" and "new" Europe signaled anunofficial shift in U.S. policy away from continued support for further European integration. Suchconcerns have contributed significantly to recent frictions in the broader U.S.-European relationship. President Bush's visit to the EU's institutions while in Brussels in February 2005, and his clearassertion that "the United States wants the European project to succeed," have helped alleviate someEuropean anxieties. (71) However, if future U.S. policy choices related to Iran, the Israeli-Palestinian conflict, or Syria againdivide EU member states and thus hinder the EU's development of CFSP, this could negatively affectthe broader transatlantic relationship as many Europeans may find the United States an easy targetto blame. Others fear that U.S.-European disputes over the Middle East could spill over into U.S.-EUtrade relations. They point out that the breakdown in trust between the two sides of the Atlanticcould complicate efforts to resolve U.S.-EU trade disputes or to sustain U.S.-EU cooperation inmultilateral trade negotiations. (72) 

Summary: Managing policy differences on a range of issues emanating from the Middle East posesserious challenges for the United States and its European allies and friends. The most vitriolicdispute has centered on the conflict in Iraq. However, divisions over how best to approach theongoing Israeli-Palestinian conflict, manage Iran and Syria, and combat terrorism also persist. TheBush Administration and Members of Congress are concerned that continued disagreements betweenthe two sides of the Atlantic could both constrain U.S. policy choices in the region and erode thebroader transatlantic relationship and counterterrorism cooperation over the longer term. TheU.S.-initiated Broader Middle East and North Africa partnership project seeks to encourage reformsin the region and U.S.-European cooperation in tackling Mideast problems. This initiative waswelcomed by the 9/11 Commission, which recommended that the United States "should engage othernations in developing a comprehensive coalition strategy against Islamist terrorism." TheIntelligence Reform and Terrorism Prevention Act of 2004 ( P.L. 108-458 ) contains elements thatseek to promote Middle East development and reform and enhance international cooperation againstterrorism. Many analysts assert that the United States and Europe share common vital interests in theMiddle East: combating terrorism and the proliferation of weapons of mass destruction; promotingMiddle East peace and stability; ensuring a reliable flow of oil; and curtailing Islamic extremism. U.S. and European policies to promote these goals often differ considerably. Although the Europeangovernments are not monolithic in their opinions on the Middle East, European perspectives havebeen shaped over time by common elements unique to Europe's history and geostrategic position. Many Europeans believe the Israeli-Palestinian conflict should be a priority. They view it as a keydriver of terrorism, Islamic extremism, and political unrest among Europe's growing Muslimpopulations. In contrast, the U.S. Administration stresses that terrorism and weapons proliferationare the primary threats and must be pro-actively confronted; peace and stability in the region will notbe possible until these twin threats are removed. A number of other factors, such as divergentperceptions of the appropriate role of the use of force and growing European Union (EU) ambitionsto play a larger role on the world stage, also contribute to the policy gaps that have emerged. How deep and lasting the clash over Iraq and subsequent Middle East policies will be totransatlantic relations will likely depend on several factors, including whether Washington andEuropean capitals can cooperate more robustly to rebuild Iraq; whether Europeans perceive arenewed U.S. commitment to revive the Middle East peace process; and whether differences overMideast issues spill over into NATO or impede EU efforts to forge a deeper Union. This report willbe updated as events warrant. For more information, see CRS Report RL31339 , Iraq: U.S. RegimeChange Efforts and post-Saddam Governance ; CRS Issue Brief IB91137, The Middle East PeaceTalks ; CRS Report RL32048 , Iran: U.S. Concerns and Policy Responses ; CRS Issue Brief IB92075, Syria: U.S. Relations and Bilateral Issues ; and CRS Report RL31612(pdf) , European Counter-terroristEfforts: Political Will and Diverse Responses in the First Year after September 11 .