The EU's Secret Weapon to Combat US Economic Bullying: Time to Activate It

Will Brussels finally resist the US administration and American tech giants? Present inaction goes beyond a regulatory or financial shortcoming: it constitutes a ethical failure. This situation throws into question the bedrock of Europe's democratic identity. The central issue is not merely the fate of firms such as Google or Meta, but the principle that the European Union has the authority to regulate its own online environment according to its own laws.

The Path to This Point

First, let us recount the events leading here. In late July, the European Commission accepted a one-sided agreement with Trump that locked in a permanent 15% tax on EU exports to the US. Europe received nothing in return. The embarrassment was all the greater because the EU also agreed to provide well over $1tn to the US through investments and purchases of resources and defense equipment. The deal exposed the vulnerability of Europe's reliance on the US.

Less than a month later, the US administration threatened crushing new tariffs if the EU enforced its regulations against US tech firms on its own territory.

Europe's Claim vs. Reality

For decades Brussels has claimed that its economic zone of 450 million affluent people gives it unanswerable leverage in international commerce. But in the month and a half since Trump's threat, Europe has taken minimal action. Not a single counter-action has been taken. No invocation of the new trade defense tool, the often described “trade bazooka” that the EU once vowed would be its ultimate protection against foreign pressure.

Instead, we have polite statements and a penalty on Google of less than 1% of its annual revenue for longstanding market abuses, already proven in American legal proceedings, that enabled it to “abuse” its market leadership in the EU's digital ad space.

US Intentions

The US, under the current administration, has made its intentions clear: it no longer seeks to support EU institutions. It aims to weaken it. An official publication published on the US Department of State's platform, written in paranoid, bombastic language similar to Hungarian leadership, charged the EU of “systematic efforts against democratic values itself”. It criticized supposed limitations on political groups across the EU, from German political movements to PiS in Poland.

The Solution: Anti-Coercion Instrument

How should Europe respond? Europe's anti-coercion instrument functions through calculating the degree of the coercion and imposing counter-actions. Provided EU member states consent, the EU executive could remove US goods and services out of the EU market, or impose tariffs on them. It can strip their patents and copyrights, prevent their investments and require reparations as a condition of re-entry to EU economic space.

The instrument is not only economic retaliation; it is a statement of determination. It was designed to signal that the EU would never tolerate foreign coercion. But now, when it is most crucial, it remains inactive. It is not a bazooka. It is a symbolic object.

Internal Disagreements

In the months preceding the EU-US trade deal, many European governments used strong language in public, but failed to push for the instrument to be used. Some nations, including Ireland and Italy, publicly pushed for a softer European line.

Compromise is the worst option that Europe needs. It must implement its regulations, even when they are inconvenient. In addition to the trade tool, the EU should disable social media “for you”-style algorithms, that recommend content the user has not requested, on EU territory until they are proven safe for democratic societies.

Broader Digital Strategy

The public – not the automated systems of international billionaires serving external agendas – should have the autonomy to make independent choices about what they see and share online.

The US administration is pressuring the EU to water down its digital rulebook. But now especially important, Europe should hold American technology companies responsible for anti-competitive market rigging, surveillance practices, and preying on our children. EU authorities must ensure Ireland accountable for failing to enforce EU online regulations on US firms.

Enforcement is insufficient, however. Europe must gradually substitute all foreign “major technology” services and computing infrastructure over the next decade with European solutions.

The Danger of Inaction

The real danger of the current situation is that if Europe does not take immediate action, it will become permanently passive. The longer it waits, the deeper the decline of its self-belief in itself. The increasing acceptance that resistance is futile. The greater the tendency that its regulations are unenforceable, its governmental bodies not sovereign, its democracy not self-determined.

When that happens, the route to undemocratic rule becomes unavoidable, through algorithmic manipulation on social media and the acceptance of misinformation. If Europe continues to remain passive, it will be pulled toward that same decline. Europe must take immediate steps, not only to push back against Trump, but to create space for itself to function as a independent and sovereign entity.

Global Implications

And in doing so, it must plant a flag that the international community can see. In North America, Asia and Japan, democracies are observing. They are wondering if the EU, the last bastion of liberal multilateralism, will stand against external influence or surrender to it.

They are asking whether democratic institutions can survive when the leading democratic nation in the world abandons them. They also see the model of Lula in Brazil, who faced down Trump and showed that the approach to deal with a aggressor is to respond firmly.

But if the EU hesitates, if it continues to release polite statements, to impose symbolic penalties, to hope for a improved situation, it will have already lost.

Amy Alexander
Amy Alexander

A tech enthusiast and writer passionate about sharing knowledge on software development and life hacks.