CSDS POLICY BRIEF • 2/2025
By Daniel Fiott
23.1.2025
Key issues
- The second Trump presidency will in many ways be unique, but Europeans will likely still pursue the short-term tactics of keeping a low profile or enhancing bilateralism with the United States (US).
- Europeans may try to play President Trump at his own game through transactionalism, or to engage with China and others to hedge against Washington, but there are grave risks in pursuing these lines.
- The European Union (EU) needs to be bold in planning for life after President Trump. This calls for far greater defence spending, supporting Ukraine and lowering energy and technology dependencies.
Introduction
Unity. The antidote to Trump or Trumpism? Chancelleries across Europe are already talking up the virtues of European unity as a way of weathering the storm that is heading to European shores from over the Atlantic. One can understand why Europeans want to seek refuge under the banner of “unity”. It largely worked during and after the Covid-19 crisis, and, after Russia’s invasion of Ukraine, unity was required as a precondition for all of the steps the EU would go on to take in support of Kyiv including sanctions, diplomatic cover, financial support and armaments. Unity is understandably the core mantra of the EU, although unity does not always prevail in times of crisis. We should not consider unity as a given, not least when foreign powers actively work to create schisms between European nations – sometimes through direct interference – or when some EU member states themselves work to break consensus and common action.
Yet, the emerging truth is that several European nations have reverted back to, for want of a better term, the “Trump 1.0 playbook”. That is, to curry favour with President Trump in Washington by buying American – the “we’ll pay but leave us alone” theory – or to simply keep a “low profile” in the hope that the president will not want to pick a fight. One can, of course, understand this logic but it has its limits. The new US administration knows perfectly well that targeted policies against the Union, in say the area of tariffs, will have a blanket effect with the aim of smothering the Union until it caves in on some other demand. “Trump 2.0” will not be an exact sequel of “Trump 1.0”.
Many of the “counter-Trump” strategies being sketched-out in European capitals today take their inspiration from the experiences of the first Trump term. Yet, Europeans should not expect a re-run of the first Trump presidency. President Trump has one term left, which may lead European governments to play the waiting game – this logic sees Europeans waiting out the next four years, with the understanding (and hope) that the storm clouds will pass. This game seemed to work last time – specific European nations took a lot of political flak and they were directly targeted by the US, but ultimately they prevailed with the so-called “reward” being the election of a more benevolent Democrat leader in the form of President Biden. With the war raging in Ukraine after Trump’s first term, Europeans convinced themselves that they could count on a more predictable US administration.
The truth, however, is that President Trump did alter the political reality for Europeans way beyond his first mandate. Europeans continued to de-risk from Chinese technologies and supply chains, and Europeans are still living with the “post-2% of GDP” era. It was President Trump that first bullied Europeans into recognising their own self-interest was in increasing defence spending. Sure, Russia’s invasion was the real shock factor behind increased European defence spending, but it was President Trump who called for 3%, 4% and 5% of GDP. What is more, there is ample evidence to show that the Biden presidency continued and even intensified many of the US’ protectionist and nationalist economic policies that were initially instigated by President Trump. So, in many respects the Biden administration continued Trumpism, albeit with a smile. This should tell Europeans something rather important about the degree of bipartisan consensus that exists in the US today, beyond the excitement of day-to-day political campaigning.
Unity without purpose?
So, “unity” will no doubt continue to be the Union’s main political mantra over the next few years, but unity without purpose is relatively meaningless. President von der Leyen has already recognised this point with her remark at the recent World Economic Forum that ‘when Europe is united, it gets things done’. Ultimately, unity is not enough and the Union will have to follow through with its promise of generating billions of euros of investment in the single market and in key strategic sectors such as defence, Artificial Intelligence, space, semiconductors and more. Without following through in this way, unity will start to falter and appear shallow. Of course, this is easier said than done in a context of budgetary pressures in key EU member states, including France and Germany. Without substantial investments, however, Europe may just become the “museum with old people” caricature that is often callously spread across social media by bots and “tech bros”.
Yet calls for the urgent need to invest billions in major European strategic projects leave a bitter taste in some capitals’ mouths. The familiar objections come to mind. On the one hand, strategic projects are seen as a way for the industries of larger member states to hoover up all of the economic benefits of additional spending. On the other hand, the so-called “frugals” seek to resist additional European debt, especially in areas such as defence that they consider to be too high risk or unpalatable for voters. In this respect, those member states that look at grandiose EU designs with suspicion are likely to covertly plead their case in Washington. Again, these Europeans may seek to use President Trump’s aversion to all things EU – and his deep attachment to national sovereignty – to torpedo steps forward in integration, especially if they read integration as a threat to their domestic economic interests and national sovereignty.
Defence industrial politics illustrate this point well. While the European Commission calls for the de-fragmentation of the European defence market, and a “big bang” in defence investments for joint procurement, some capitals have raised their eyebrows in suspicion. Sure, the war on Ukraine and threat from Russia are reasons to boost national defence – at least in some European nations –, but it might not be a sufficient reason to integrate further via the EU. That is the question being asked by some. And this suspicion aligns fully with President Trump’s own thinking. Even if the EU mobilises €500 billion for joint defence procurement in the coming years, this will not really interest the President. And not just because such money would fail to be directly counted as part of Europe’s overall spend on defence as a share of GDP. No, because such money would be destined to support European defence industries in the EU, rather than American ones. So, an alliance of convenience on this front is likely to appear between the US and certain European nations.
Style and substance
The temptation to get caught up in the theatrics of the new US administration should be avoided. Style and substance are not two entirely different things under the Trump administration, but it is worth trying to understand what drives President Trump and his team. Whatever one thinks of the public messaging on Canada and Greenland, and while respecting that Ottawa and Copenhagen will defend their territorial sovereignty, there appears to be a logic behind how President Trump and his team view world politics. The inauguration speech had the undertones of 19th century geopolitics, with a much greater insistence on geographical territory and space. In fact, President Trump specifically stated that ‘The United States will once again consider itself a growing nation, one that increases our wealth, expands our territory’. That last line on the expansion of territory may seem shocking, but it does fit President Trump’s instinctive understanding of geopolitical rivalry. He literally calculates power in terms of wealth, resources, land and the military.
Although President Trump invoked the ghost of President William McKinley during his inauguration, the current president’s ambition goes beyond mere economic protectionism. Like McKinley, President Trump has a clear interest in re-industrialisation, even though economists highlight that tariffs may ultimately cost the American consumer more in the long-term. However, President Trump is perhaps closer to Friedrich List’s philosophy of rejecting the Smithian principle of free trade. Let us not forget that it was List that argued tariffs were justified if the higher political goal was to increase national productive power. Europeans still largely see politics as being at the service of economics and commercial benefits. Under President Trump, Americans increasingly have the opposite view.
And perhaps this is at least partly behind the outrage felt by many Europeans when they see attacks on European elections and regulations by the so-called “tech oligarchs” like Elon Musk, Jeff Bezos or Mark Zuckerberg. These CEOs have freely prostrated themselves before President Trump: some through conviction, others to avoid the President’s wrath. Regardless of whether American tech CEOs are cosying up to the new president for tightly-held beliefs or opportunism, the effect is the same: America’s political class and its innovative firms are seeking to combat any foreign power that stands in the way of their commercial and political objectives. A marriage of convenience perhaps, but one that is ultimately being put to the service of US national interests.
Yet, President Trump is also trying to turn the clock back on the energy transition, and not just because it is part of a so-called “woke agenda”. President Trump has already made clear that the US seeks to extend its global position as a net exporter of fossil fuels. This need to secure as much of the world’s energy sources is certainly behind President Trump’s comments on Greenland and Canada – he has directly invoked the question of energy resources in both cases. Both are home to largely untapped energy sources, but they are also geographically closer to the US’ main target market in Europe. Moving energy storage and transport infrastructure closer to Europe and Eurasia, so the logic goes, could help reduce the costs of energy compared to other suppliers such as Russia and the Middle East. However, the new president also needs to convince Europeans that they should drop their green aspirations in favour of cheaper American fossil fuels.
For the US, the so-called “green agenda” and China’s industrial power are inter-linked. Despite the gas-guzzling nature of the Chinese economy, Beijing is gaining a larger foothold in Europe’s automobile sector through the sale of electric vehicles and batteries. Even if the European Commission has imposed tariffs of more than 45% on Chinese electric vehicles, the stark reality is that Europe is trading its past fossil fuel dependence on Russia for a new technological dependence on Chinese batteries. This new addiction is being driven by the energy transition and the need to rescue Europe’s flailing automobile sector. Here, President Trump eyes an opportunity to give China a bloody nose in “green exports”, by forcing Europeans on to the teat of cheap American oil. With continued European energy dependencies, the EU will potentially face its toughest challenge in managing American demands on oil and gas with its own drive towards a new green deal.
A European “art of the deal”?
When Europeans try to understand the motivations of President Trump, they usually call him a transactionalist. There is some merit to this framing. President Trump appears to want to bargain with Europeans across a range of sectors including defence, the economy and technology. Thus, on one day the US may threaten to pull-out of NATO unless the Europeans spend more on defence. Yet, on another day, America could use its security guarantee as a bargaining chip to extract concessions on single market regulations that it claims unfairly target American tech firms. On any other day, the security guarantee could be equally used as leverage to ensure Europeans buy more US-made defence equipment or American oil and gas. There are so many levers for the US to pull in order to try and strong arm Europeans into yielding to American interests. Owing to European dependencies in defence and energy, the old continent is an easy target for such tactics.
Europeans may seek to play President Trump at his own game: that is, to be transactional too. There have already been voices that have argued that any American tariffs on Europe would damage the European economy, and, thus, seriously hamper Europe’s ability to up its defence spending – Trump’s “big ask”. Thus, the logic goes, if President Trump wants increased European defence spending, he should ease-off on starting a trade and tariff war. Although alluring, this logic has its risks. For example, the US could impose tariffs on Europe and then drastically reduce its military commitment to Ukraine and NATO – or at least threaten to. In this scenario, Europeans would be forced to increase defence spending regardless of American tariffs, simply because it would be in their direct security interests to do so – and let us be clear, it is in European interests to do so. Other voices may advocate for European regulators to ban social media platforms like X, but such calls are largely based on ideological grounds rather than on any sound strategy of how the threat of a European ban could be used to leverage the US in other policy areas. It is risky to engage with this form of transactionalism, especially if one’s bluff is called.
European transactionalism over defence spending and Ukraine is risky too. Despite repeated calls to do “whatever it takes” for Kyiv, the reality is that certain European capitals would actively push for a “peace deal” in Ukraine as a way of lowering the pressure on maintaining higher levels of defence spending, especially in the current economic climate. The logic here is that cooling down the war on Ukraine through a ceasefire can lower the urgency with which Europeans move to a “war economy” footing. European states that are removed from the front line may calculate that defence does not equal votes, so any “peace deal” can result in more money for vote winning areas of domestic politics: and which voter does not love “peace”? This is, by definition, a short-sighted approach, not least because there is every indication that Vladimir Putin will never really honour a “peace deal”, whatever a deal may even look like. He too can play a waiting game and build-up his military during any armistice.
In any case, it is questionable whether President Trump links the question of higher European defence spending so tightly to events in Ukraine. If Europeans want to support Ukraine in the event that the US somehow abandons Kyiv, then this calls for considerably more, and not less, defence spending. Deluded Europeans are those that believe any “peace deal” over Ukraine will lead President Trump to relax his insistence on Europeans needing to spend up to 5% of GDP on defence. Remember, President Trump was calling for increased European defence spending long before Russia marched on Kyiv in 2022. President Trump frames the need for Europeans to increase defence spending as a matter of “expense” for America. But it is not just this. There are already indications that President Trump’s supposed draw-down in Ukraine is designed to extract more financial and military support from Europeans. In fact, one theory is that President Trump and his team would like Europeans to buy military equipment from the US, to then pass on to Ukraine. This would allow US defence contractors to continue to benefit from military exports to Ukraine, but it would be Europeans footing the bill instead of Washington.
Dealing with disruption
In the corridors of power in Brussels, policymakers are looking for the “masterplan” on dealing with President Trump. Yet, it is doubtful whether a rational plan can be devised, not least because President Trump’s brand of politics is disruptive and unpredictable. The reality is that there will inevitably be a lot of muddling through by EU member states and institutions – they have no choice. President Trump will try to prise apart European nations and avoid any European banding together through the EU on issues that are deemed critical to US national security interests. The next four years will see divisions between EU nations on critical files and many will not so easily forego forging bilateral relations with the new administration – both as a way to placate President Trump and to control the direction and speed of European integration. Institutions such as the European Commission can play a critical role in generating European unity, but ultimately it is the member states that will decide whether they are seduced by President Trump or not. In any case, even though new European leaders are emerging – such as Poland – French-German leadership has essentially collapsed for the time-being.
One of the obvious ways Europeans can adjust to the new US administration is to admit that President Trump has been right on a number of strategically relevant issues: think of defence spending and China. Any hysteria towards the president or people closely associated with him is unhelpful in crafting policy responses. There is no need for the EU to react to every statement, speech or social media post. In fact, as NATO Secretary General Rutte’s recent comments highlight, Europeans are already starting to acknowledge that President Trump may in fact have a point on critical strategic questions such as defence investment. It is manifestly in the interests of Europeans to invest in their own defence. However, it is also true that Europeans may never quite see eye-to-eye with President Trump on his attempts to broker a “peace deal” with Putin over Ukraine. Much will have to do with the terms of any agreement, and whether it results in a ceasefire or on more unacceptable discussions on territory for peace and/or Ukraine’s exclusion from future EU and NATO membership. Either way, whatever path a “peace deal” takes it will most certainly not last, so Europeans should already plan for a post-Trump world – should any “peace deal” last this long – by continuing to strengthen their own defences.
Defence investment in Europe is mainly about the sovereign responsibilities of European states – it is the whole point of sovereignty. Yet, a growing dimension to defence investment debates is whether there can be a European scale to them through EU-backed financial vehicles such as the defence fund (EDF) or the future defence industry programme (EDIP). The timing of President Trump’s entry to office and continued discussions on the EDIP means that EU defence industry tools will again be set against considerations for the American defence industry and President Trump. This happened last time, of course, during the negotiations for the EDF. Some member states have been calling for non-EU producers to have access to EU funds in defence, and NATO continues to make this plea too. Such a step may please the US in the short-term, but the longer-term costs of such an approach to Europe must be considered. This includes, but is not restricted to, whether EU-funded defence projects can be fully controlled by EU member states (i.e. for technology and export purposes) or whether non-EU producers will be included in projects at the expense of other EU producers.
Whichever way the discussions on the EDIP go, there is a growing impulse in Europe to help re-generate defence industrial production. Not only do a growing number of member states understand that EU-level investments in defence are good for nurturing domestic defence producers, but that lowering defence industrial dependencies – on a national and European level – is a good way of hedging against potential transatlantic shocks. This is why the alluring logic of simply travelling to Washington with an offer to spend x amounts of euros on American defence equipment will have limited long-term success. In any case, the American defence industry is set for a shake-up of its own under President Trump, and there remain questions about how quickly American producers would be able to meet European demands. So, while it is alluring to “buy American” for short-term political ends, this may not actually make longer-term sense for Europe’s own defence industrial renaissance. Nor will the idea of asking President Trump to alter stringent US rules and laws on defence market access really work. The President would no-doubt welcome additional European investment in the US defence market, but not at the expense of the existing levels of political and extra-juridical control that Washington enjoys under ITAR and other rules.
Neither is a “low profile” tactic really worth pursuing by Europe, even if the Union should not react to every proclamation by President Trump. The hope that President Trump will become distracted by the “small stuff” in international life is not a strategy either. True, limited political damage may come from a President that spends the next four years rallying against the EU’s rules on bottle caps (and at the NATO Hague Summit in June he is more than likely to drink his favourite Diet Coke from an EU regulated bottle). Yet, relying on distraction is hardly a strategy. What should be avoided, however, is any creep towards anti-Americanism by European politicians. With the rise of extreme political parties in Europe, and the intervention by US-based “tech oligarchs” in European democracies, we may all too easily fall into a cheap and damaging nativism across both sides of the Atlantic – it will be difficult to contain this once pandora’s box has been opened. This really would be a huge distraction in an era when Europe needs to be focusing more squarely on the growing threat from China.
And, of course, Europeans cannot think coherently about President Trump and the direction of US strategy without simultaneously focusing on China. Beijing is no doubt waiting in the wings to see how transatlantic relations will develop, and China will seek to seize upon any opportunity of political fracture between the US and Europe. It will be tempting for the EU to seek to cultivate relations with China in order to leverage the US, and Beijing would of course welcome this chance. However, this form hedging hardly worked under the first Trump presidency – if anything, the Europeans hardened their position towards China. True, China’s economic coercion and political brusqueness helped sway the European position, but the Union’s whole de-risking agenda takes its inspiration from American approaches to containing Chinese power. Although many European economic operators would jump at the chance of doing more business with China, the reality is that China is not the market it once was and it has become a far more inhospitable market. Thus, any notion today of hedging against President Trump by building relations with China is misguided.
Conclusion
Ultimately, Europe should spend the next four years preparing for the post-Trump presidency. This means investing far more in defence, supporting Ukraine, lowering energy and technology dependencies and preparing for any security crises that emerge in Europe’s neighbourhood and the Indo-Pacific. And, obviously, it also means cultivating relations with close partners such as Australia, Canada, Japan, South Korea and many others. Here, we come full circle to our original point: European unity without purpose. Unity is the pre-condition for bold political decisions, but without these decisions European unity is meaningless. And there will be costs involved in investing in all of these areas, but here perhaps Europeans would do well to understand – much as America increasingly does – that the economy is at the service of politics and not the other way around. So, while Europeans will have to navigate the next four years of a Trump presidency, they should also think about what the world might look like after he departs office. Instead of thinking tactics, Europeans need to keep track of the bigger picture. Here a focus on what political dynamics President Trump will normalise in international affairs over the next four years is essential.
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The views expressed in this publication are solely those of the author and do not necessarily reflect the views of the Centre for Security, Diplomacy and Strategy (CSDS) or the Vrije Universiteit Brussel (VUB).
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