EU’s Choice: Pay €1 Trillion for Army, or Get Crushed by US & China
EU’s Choice: Pay €1 Trillion for Army, or Get Crushed by US & China
Europe is getting squeezed in a geopolitical vice—falling behind the United States and China in the resource race while its outdated economy and military dependence leave it vulnerable. A top Belgian central banker has bluntly warned the continent is “naive” if it thinks its old model still works [139921]. The warning comes as a Dutch leader revealed that full military independence from the US would cost Europe a staggering €1 trillion, or 10% of its total economic output [60363].
Pierre Wunsch, head of Belgium’s central bank, argues the European Union can no longer ignore the power shifts caused by American technology and Chinese manufacturing. “We are being naive if we think our old model still works,” Wunsch said, adding that Europe has relied too long on cheap energy, open trade, and a soft approach to foreign policy. The US is now aggressively subsidizing its own green industries, while China controls key supply chains [139921].
On the defense front, outgoing Dutch Prime Minister Mark Rutte admitted that true military self-reliance would require Europe to spend up to €1 trillion—but said this extreme goal is not practical. Instead, he pushed for stronger cooperation within NATO, with members hitting the 2% of GDP spending target [60363]. British Prime Minister Keir Starmer also warned that Europe has been “behind the curve for too long” on security, pointing to an over-reliance on external partners [140128].
France is pushing back against this narrative. French Foreign Minister Jean-Noel Barrot proposed that Europe become a “third actor” in global politics, positioning itself as a major power alongside the US and China. “Who could this third actor be today? It will be Europe, if we have the courage and the will,” Barrot said [150491].
Meanwhile, Germany’s finance minister, Lars Klingbeil, called for urgent reforms, arguing that a strong Germany is essential for a strong Europe. He warned that dependence on foreign fossil fuels and critical minerals is a risk, and that building stronger alliances and military capacity creates more options for the continent [131265].
The stakes are rising: a new report warns the EU is dangerously unprepared for a potential second Trump presidency, having relied too heavily on regulation and moral arguments instead of building real economic and military power. The analysis claims both the US and China have exploited these weaknesses, leaving Europe’s industrial capacity in decline [69895].