The EU's Covert Tool to Counter Trump's Economic Coercion: Time to Deploy It
Can Brussels ever stand up to the US administration and American tech giants? The current lack of response goes beyond a legal or economic shortcoming: it represents a ethical failure. This inaction calls into question the bedrock of Europe's political sovereignty. What is at stake is not merely the future of firms such as Google or Meta, but the principle that the European Union has the right to govern its own online environment according to its own regulations.
The Path to This Point
First, it's important to review the events leading here. In late July, the EU executive accepted a one-sided deal with the US that established a ongoing 15% tax on EU exports to the US. Europe gained no concessions in return. The indignity was compounded because the commission also consented to provide well over $1tn to the US through investments and acquisitions of resources and military materiel. This arrangement exposed the vulnerability of Europe's dependence on the US.
Soon after, Trump threatened severe additional taxes if Europe implemented its regulations against US tech firms on its own territory.
The Gap Between Rhetoric and Action
Over many years Brussels has asserted that its economic zone of 450 million affluent people gives it significant leverage in trade negotiations. But in the six weeks since Trump's threat, Europe has done little. No counter-action has been taken. No activation of the new trade defense tool, the so-called “trade bazooka” that Brussels once vowed would be its primary protection against external coercion.
By contrast, we have diplomatic language and a penalty on Google of under 1% of its yearly income for longstanding market abuses, already proven in US courts, that enabled it to “abuse” its market leadership in the EU's digital ad space.
American Strategy
The US, under the current administration, has made its intentions clear: it does not aim to support European democracy. It seeks to weaken it. A recent essay published on the US State Department platform, written in alarmist, inflammatory language reminiscent of Viktor Orbán's speeches, charged the EU of “an aggressive campaign against democratic values itself”. It criticized alleged restrictions on authoritarian parties across the EU, from the AfD in Germany to PiS in Poland.
Available Tools for Response
How should Europe respond? Europe's anti-coercion instrument functions through calculating the extent of the coercion and applying counter-actions. If EU member states agree, the EU executive could kick US products out of the EU market, or impose tariffs on them. It can strip their intellectual property rights, prevent their financial activities and demand reparations as a requirement of re-entry to EU economic space.
The instrument is not merely financial response; it is a statement of determination. It was designed to signal that the EU would always resist foreign coercion. But now, when it is needed most, it remains inactive. It is not the powerful weapon promised. It is a symbolic object.
Political Divisions
In the period preceding the EU-US trade deal, several EU states used strong language in public, but failed to push for the mechanism to be used. Some nations, including Ireland and Italy, openly advocated more conciliatory approach.
Compromise is the worst option that Europe needs. It must implement its laws, even when they are challenging. Along with the trade tool, the EU should disable social media “recommended”-style systems, that recommend material the user has not requested, on EU territory until they are proven safe for democratic societies.
Comprehensive Approach
Citizens – not the algorithms of international billionaires serving foreign interests – should have the autonomy to decide for themselves about what they see and distribute online.
Trump is pressuring the EU to water down its online regulations. But now more than ever, the EU should hold American technology companies responsible for anti-competitive market rigging, surveillance practices, and targeting minors. Brussels must ensure Ireland responsible for not implementing EU digital rules on American companies.
Regulatory action is insufficient, however. The EU must progressively replace all foreign “major technology” services and computing infrastructure over the next decade with homegrown alternatives.
Risks of Delay
The significant risk of the current situation is that if the EU does not take immediate action, it will never act again. The more delay occurs, the more profound the erosion of its confidence in itself. The increasing acceptance that resistance is futile. The greater the tendency that its laws are not binding, its governmental bodies not sovereign, its democracy dependent.
When that happens, the route to authoritarianism becomes unavoidable, through automated influence on social media and the acceptance of lies. If Europe continues to remain passive, it will be pulled toward that same abyss. Europe must take immediate steps, not just to push back against US pressure, but to create space for itself to exist as a free and sovereign entity.
International Perspective
And in doing so, it must make a statement that the rest of the world can see. In North America, Asia and Japan, democracies are watching. They are questioning if the EU, the remaining stronghold of liberal multilateralism, will resist foreign pressure or yield to it.
They are asking whether democratic institutions can survive when the most powerful democracy in the world turns its back on them. They also see the example of Lula in Brazil, who faced down Trump and showed that the way to deal with a bully is to respond firmly.
But if Europe delays, if it continues to release diplomatic communications, to impose token fines, to hope for a better future, it will have effectively surrendered.