ASSISTANT SECRETARY FRIED'S PARIS MEETING WITH MFA

C O N F I D E N T I A L SECTION 01 OF 02 PARIS 004154

SIPDIS

E.O. 12958: DECL: 06/10/2015
TAGS: PREL FR EUN
SUBJECT: ASSISTANT SECRETARY FRIED'S PARIS MEETING WITH MFA
POLITICAL DIRECTOR DE LABOULAYE

REF: PARIS 4153

Classified By: Charge d'affaires Alex Wolff for reasons 1.4 (b) and (d)
.


1. (C) Summary: MFA Political Director Stanislas de
Laboulaye told visiting Assistant Secretary Daniel Fried June
8 that French and Dutch voters' rejection of the EU
constitution had precipitated a crisis in European affairs.
This was not the EU's first such set-back, but it was serious
and would require careful thinking on next steps. Laboulaye,
in contrast to Elysee Diplomatic Advisor Gourdault-Montagne
(reftel),thought it would be wisest to halt the
constitutional ratification process in order to avoid more
voter rejection and a deepening crisis. Concerns over EU
enlargement, including a diminished sense of job security,
and fears that their social welfare guarantees were under
attack from an EU moving rapidly towards a free-market,
"Anglo-Saxon" economic model, caused many in France to vote
no. This would necessitate much more careful deliberation on
future EU enlargements. Agreeing on the need to continue
U.S.- EU cooperation in addressing world problems, Laboulaye
said solving the Israeli-Palestinian conflict should be a
major shared priority. End summary.


2. (C) Assistant Secretary Fried met in Paris June 8 with
MFA Political Director Stanislas de Laboulaye. Participants
included:

U,S.
--------------

A/S Fried
Charge Alex Wolff
Acting DAS Kathy Allegrone
A/POL Paul Mailhot (notetaker)

France
--------------

Political Director de Laboulaye
Director for Strategic and Security Affairs Philippe Carre
Director for Near East and North African Affairs Bernard
Thibault
Common Foreign and Security Policy Unit Chief Jean-Louis
Falconi
DAS-equivalent for North American Affairs Odile Roussel


3. (C) As he had during his meeting a day earlier with
Elysee Diplomatic Advisor Gourdault-Montagne (reftel),A/S
Fried opened his meeting with MFA Political Director de
Laboulaye by stating that he had initiated his visit to
France, Italy and Germany to assure governments and publics
that the U.S. wanted Europe to remain a strong partner and
not to turn inward as a result of voters' rejection in France
and the Netherlands of the EU constitution. The U.S. and
Europe had worked hard over the last two years to repair
their relationship after the damage caused by our
disagreement over Iraq. We are now cooperating effectively
on Iraq, Iran, the Broader Middle East, Syria/Lebanon, and
the Middle East peace process. We have good, workable
arrangements in place for NATO-EU cooperation. We have even
initiated a strategic dialogue on China, so that our
discussion of the EU arms embargo does not occur in a vacuum.
We are making progress on our common agenda and we want to
maintain the momentum. A confident Europe able to maintain
an EU perspective for the Balkans states, and if not
immediately, eventually for Turkey and Ukraine and others on
the EU's eastern borders will remain a force for peace and
stability on the continent. Our positive agenda will be a
major focus of the U.S.- EU summit June 21-22.


4. (C) Laboulaye said France shares these same objectives,
but noted that the votes in France and the Netherlands had
ushered in "a time of reflection" in the EU. In fact, it
could very probably be called a crisis. Even though the EU
had weathered crises before, the votes posed an existential
dilemma for the EU. "It's about what we want to do," as a
union, and a question that will not be solved at the June
16-17 European Council. A first question, made even more
current by the British decision to suspend their process, is
whether to continue with the constitutional ratification
process or to give it up as a lost cause, Laboulaye said. An
argument could be made that it is necessary to continue the
process, de Laboulaye said. However, in contrast to the
Elysee's Gourdault-Montagne, Laboulaye said that continuing
might just set up the EU for more no votes and even deeper
crisis, and it might therefore be wisest to call a halt to
the process.


5. (C) Voters' uneasiness over enlargement and their lack of
acceptance of the most recent, 10-member expansion, were
major factors accounting for the no vote in France, Laboulaye
went on. There is a wide-spread perception among voters that
they were not sufficiently consulted about the most recent
enlargement. This bred resentment as voters found that their
lives were directly affected by the "delocalization" of jobs
to the east and the influx of low-wage workers from the new
member countries. In addition, many in France felt that
their social welfare benefits were under threat from a
leadership bent on implementing a free-market, "Anglo-Saxon"
economic system throughout the EU. The vote in France
pointed up disturbing divisions, with cities and the
well-to-do voting for the constitution and the country-side
and less-well-off voting overwhelmingly against. France will
have to step back and deal with these issues.


6. (C) Laboulaye recalled that new Prime Minister Dominique
de Villepin had made reducing unemployment his government's
top priority, in direct response to the fears among French
workers that lay behind their no votes on the constitution.
Germany, too, will focus on strengthening domestic economic
and social conditions in the wake of the no votes. Moreover,
France will seek to reinforce its conception of a supportive
social model at the European level, but may well encounter
opposition from the UK, which will exert significant control
over the agenda as UK presidency nation starting July 1.
"This could lead to tension at the beginning of the EU
presidency," Laboulaye said. Inevitably, France will have to
be more inward looking before it can begin again to try to
shape the kind of Europe it wants.


7. (C) The defeat of the constitution will also cause France
to "reflect on EU enlargement" which has not been popular.
Immigration policy, even more of an issue in the Netherlands
than in France, will also have to be examined. So pervasive
are these concerns that many believe that had Italy, Germany
and others in "old Europe" mounted referendums on the
constitution, their populations, too, would have voted no,
Laboulaye said. For Romania and Bulgaria, the process will
likely move forward, but this will have to be discussed. For
the Balkans, while French diplomats may agree on the need to
preserve the incentive of prospective EU membership, most
French voters will be much more reserved, and the government
will have to be responsive, Laboulaye said. A/S Fried
cautioned that retrenchment could lead only to perpetuation
of a downward economic spiral. The solution lies in a
political leadership able to explain the benefits to
continental stability entailed in maintaining a European
future for the Balkans states. While we want no voice in
European constitutional arrangements, we do want to continue
to have a strong Europe as a partner on such issues as
promoting democracy in the Broader Middle East, and ending
the violence and helping people in distress in Darfur.


8. (C) Europe will need time "to reflect on how to put the
pieces back together," Laboulaye responded. Decision-making
is proving time-consuming and difficult with 25 members.
France wants the EU to speak with one voice, not in a
collection of voices. This will be difficult, but the U.S.
can help by avoiding playing one member off another,
Laboulaye went on. Inter-state relations will be far more
sensitive within the EU in the wake of the no votes. Any
exploitation of differences "over a small question, like
Darfur," for example, could precipitate wider
misunderstanding. A/S Fried responded, saying that the U.S.
was not seeking to divide EU members. He warned, in turn,
that Europe should not seek to forge artificial unity by
setting up Europe as a counterweight to the U.S. or behaving
as if NATO "were a carrier of disease." We have to focus on
our shared, positive agenda.


9. (C) Laboulaye agreed and said that the
Israeli-Palestinian conflict was perhaps the most important
issue on which Europe and the U.S. could work together. It
was continually surprising, he said, how central this
question was for most Europeans, while it remained of only
peripheral concern in the U.S. Like the Dreyfus Affair of a
century ago, the topic is never absent from conversations
among the French. The U.S. has a decisive role to play.
President Bush's statements during Palestinian Prime Minister
Abbas's visit to Washington last week were encouraging. Both
the U.S. and Europe want Israeli Prime Minister Sharon to
succeed with Gaza withdrawal. If he does so, it will be
important for him to move quickly thereafter to initiate a
withdrawal from the West Bank. A/S Fried said it was
essential that Gaza withdrawal succeed. This could create
the momentum needed to move to the next stage in the West
Bank. Failure in Gaza, however, would set the process back
for years. Sharon's commitment was important, but so too,
was Abbas's to tightening security and cracking down on
terrorism.


10. (U) A/S Fried cleared this message.
WOLFF