The EU's Covert Tool to Counter Trump's Trade Pressure: Time to Utilize It
Can the EU ever stand up to Donald Trump and American tech giants? Present passivity is not just a regulatory or financial shortcoming: it constitutes a ethical collapse. This inaction calls into question the core principles of the EU's political sovereignty. What is at stake is not only the future of companies like Google or Meta, but the fundamental idea that Europe has the authority to govern its own online environment according to its own regulations.
How We Got Here
First, let us recount how we got here. During the summer, the EU executive agreed to a humiliating deal with Trump that established a ongoing 15% tariff on European goods to the US. Europe received nothing in return. The embarrassment was compounded because the commission also consented to provide well over $1tn to the US through financial commitments and purchases of resources and military materiel. The deal exposed the vulnerability of Europe's reliance on the US.
Soon after, Trump threatened crushing new tariffs if the EU enforced its laws against American companies on its own territory.
Europe's Claim vs. Reality
Over many years EU officials has asserted that its economic zone of 450 million affluent people gives it unanswerable sway in international commerce. But in the six weeks since Trump's threat, Europe has done little. No retaliatory measure has been implemented. No invocation of the recently created trade defense tool, the so-called “trade bazooka” that the EU once promised would be its ultimate protection against foreign pressure.
By contrast, we have diplomatic language and a fine on Google of under 1% of its annual revenue for longstanding anticompetitive behaviour, previously established in American legal proceedings, that allowed it to “abuse” its market leadership in Europe's advertising market.
American Strategy
The US, under the current administration, has made its intentions clear: it does not aim to support EU institutions. It aims to weaken it. A recent essay published on the US Department of State's platform, composed in paranoid, inflammatory language reminiscent of Hungarian leadership, accused the EU of “systematic efforts against Western civilization itself”. It criticized alleged restrictions on political groups across the EU, from the AfD in Germany to PiS in Poland.
The Solution: Anti-Coercion Instrument
How should Europe respond? Europe's anti-coercion instrument functions through calculating the extent of the pressure and imposing counter-actions. Provided most European governments consent, the European Commission could kick US products out of the EU market, or apply taxes on them. It can remove their patents and copyrights, prevent their investments and demand reparations as a requirement of readmittance to Europe's market.
The instrument is not merely financial response; it is a declaration of political will. It was created to signal that Europe would always resist foreign coercion. But now, when it is most crucial, it lies unused. It is not a bazooka. It is a paperweight.
Political Divisions
In the months leading to the EU-US trade deal, several EU states talked tough in official statements, but failed to push for the instrument to be used. Some nations, such as Ireland and Italy, openly advocated more conciliatory approach.
Compromise is the last thing that Europe needs. It must enforce its laws, even when they are inconvenient. In addition to the trade tool, Europe should shut down social media “for you”-style systems, that recommend content the user has not requested, on EU territory until they are demonstrated to be secure for democracy.
Broader Digital Strategy
Citizens – not the automated systems of foreign oligarchs serving foreign interests – should have the freedom to decide for themselves about what they view and distribute online.
Trump is putting Europe under pressure to water down its online regulations. But now especially important, Europe should make American technology companies responsible for distorting competition, snooping on Europeans, and targeting minors. Brussels must hold certain member states accountable for failing to enforce Europe's online regulations on US firms.
Enforcement is not enough, however. Europe must progressively replace all non-EU “big tech” platforms and computing infrastructure over the next decade with homegrown alternatives.
The Danger of Inaction
The real danger of this moment is that if the EU does not act now, it will never act again. The longer it waits, the more profound the decline of its confidence in itself. The more it will believe that opposition is pointless. The more it will accept that its laws are not binding, its institutions not sovereign, its political system dependent.
When that occurs, the path to undemocratic rule becomes inevitable, through algorithmic manipulation on social media and the acceptance of misinformation. If the EU continues to cower, it will be pulled toward that same abyss. Europe must take immediate steps, not only to resist US pressure, but to establish conditions for itself to function as a independent and sovereign entity.
Global Implications
And in doing so, it must plant a flag that the rest of the world can see. In Canada, South Korea and East Asia, democratic nations are watching. They are questioning if the EU, the last bastion of liberal multilateralism, will resist foreign pressure or yield to it.
They are asking whether representative governments can endure when the leading democratic nation in the world abandons them. They also see the model of Brazilian leadership, who confronted Trump and demonstrated that the approach to deal with a bully is to respond firmly.
But if Europe hesitates, if it continues to release diplomatic communications, to impose symbolic penalties, to hope for a improved situation, it will have effectively surrendered.