A problem for Draghi and others who want radical reform is that the economic crisis is more of the “slowly-boiling-frog” variety rather than a severe one, such as the cutoff of Russian gas. In that dire and urgent case, the EU showed how its collective will could find solutions relatively quickly to the loss of most Russian energy supplies while sanctioning Russia and helping Ukraine. Any large-scale investments, along with other reforms, such as completing the capital markets union as recommended in the Draghi report, will take years to show concrete results and raise average living standards.       

Just as U.S. decision-makers have had difficulty understanding the rapidly changing global landscape, EU leaders have been arguably slower in comprehending the magnitude of the geopolitical and geoeconomic changes that took place during the last decade. These changes, such as a more protectionist U.S. policy since 2008 and a more competitive China, have threatened many EU economies’ reliance upon open markets. Unlike in past decades, when China was a significant consumer of German cars, machinery, and tools and did not pose a competitive threat, the country's heavily subsidized companies are now starting to manufacture their own high-quality, low-cost electric vehicles and flood global markets.      

Trump the Trigger?

Oddly, Trump and his hyperbolic nationalism could be the spark that fuels Europe’s desire to renew itself for the next generation. Without Trump’s challenge to Europe, leaders in Berlin, Paris, and elsewhere may not perceive any urgency to change course and take the needed medicine. Europeans were shocked in 2016 when Trump was first elected, with many seeing it as an aberration, particularly after Biden’s victory over Trump in 2020. The former president’s return to the White House would make it impossible to ignore the deep isolationist and populist trend in American politics. If Trump treated ties with Europe transactionally, Europe would have to adjust, including defending itself economically against the United States. Certainly, a Trump-arranged peace with Russia without much consideration for European views would be a signal that Washington’s perspective on Europe had changed. A second Trump administration might want European support against China and other threats, but it is likely to care less about European interests in general. 

On the other hand, a weak Europe is not in the interest of the United States. As the world becomes more non-Western with the rise of Asian and other powers, a stronger Europe could be an equal partner. The EU’s dedication to multilateralism and consensus—the foundation upon which it is built—holds lessons for how the United States should engage with a multipolar world. Still, any such guidance will not be accepted so long as Washington’s view is that Europe is declining and “sponging” off the United States.

Mathew Burrows is a Counselor in the Executive Office of the Stimson Center and the Program Lead of its Strategic Foresight Hub.

Image: Alexandros Michailidis / Shutterstock.com.