Europe's Covert Weapon to Address US Economic Pressure: Moment to Deploy It
Can the EU ever resist the US administration and US big tech? The current lack of response goes beyond a regulatory or economic shortcoming: it represents a moral failure. This situation calls into question the very foundation of the EU's democratic identity. What is at stake is not merely the future of companies like Google or Meta, but the principle that Europe has the right to govern its own online environment according to its own regulations.
The Path to This Point
To begin, let us recount how we got here. In late July, the EU executive agreed to a one-sided deal with Trump that locked in a ongoing 15% tariff on European goods to the US. The EU received nothing in return. The embarrassment was all the greater because the EU also agreed to direct well over $1tn to the US through financial commitments and acquisitions of resources and defense equipment. The deal exposed the vulnerability of the EU's reliance on the US.
Soon after, Trump warned of crushing new tariffs if Europe enforced its laws against US tech firms on its own territory.
The Gap Between Rhetoric and Action
Over many years Brussels has claimed that its market of 450 million affluent people gives it significant leverage in international commerce. But in the month and a half since the US warning, the EU has taken minimal action. Not a single retaliatory measure has been implemented. No invocation of the new anti-coercion instrument, the so-called “trade bazooka” that the EU once promised would be its ultimate shield against external coercion.
Instead, we have diplomatic language and a penalty on Google of under 1% of its yearly income for established market abuses, previously established in American legal proceedings, that enabled it to “exploit” its market leadership in Europe's advertising market.
US Intentions
The US, under Trump's leadership, has made its intentions clear: it no longer seeks to strengthen European democracy. It aims to weaken it. A recent essay released on the US State Department platform, written in paranoid, inflammatory language reminiscent of Viktor Orbán's speeches, charged the EU of “systematic efforts against democratic values itself”. It criticized supposed limitations 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 assessing the degree of the coercion and imposing retaliatory measures. Provided EU member states consent, the EU executive could remove US goods and services out of Europe's market, or apply taxes on them. It can strip their intellectual property rights, block their financial activities and demand compensation as a condition of readmittance 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 external pressure. But now, when it is most crucial, it lies unused. It is not the powerful weapon promised. It is a paperweight.
Internal Disagreements
In the months leading to the transatlantic agreement, several EU states talked tough in official statements, but failed to push for the mechanism to be used. Others, such as Ireland and Italy, publicly pushed for more conciliatory approach.
A softer line is the last thing that Europe needs. It must implement its regulations, even when they are challenging. Along with the anti-coercion instrument, the EU should shut down social media “for you”-style algorithms, that recommend content the user has not asked for, on European soil until they are proven safe for democracy.
Broader Digital Strategy
The public – not the algorithms of international billionaires beholden to foreign interests – should have the autonomy to make independent choices about what they view and distribute online.
The US administration is pressuring the EU to weaken its digital rulebook. But now more than ever, Europe should make American technology companies responsible for distorting competition, surveillance practices, and preying on our children. Brussels must hold Ireland responsible for not implementing EU digital rules on American companies.
Regulatory action is not enough, however. Europe must gradually substitute all foreign “major technology” services and cloud services over the next decade with homegrown alternatives.
Risks of Delay
The real danger of the current situation is that if Europe does not take immediate action, it will never act again. The more delay occurs, the more profound the decline of its self-belief in itself. The increasing acceptance that opposition is pointless. The greater the tendency that its laws are unenforceable, its governmental bodies lacking autonomy, its democracy not self-determined.
When that happens, the path to authoritarianism becomes inevitable, through automated influence on social media and the acceptance of lies. If the EU continues to remain passive, it will be pulled toward that same decline. Europe must take immediate steps, not just to resist US pressure, but to create space for itself to function as a free and sovereign entity.
International Perspective
And in doing so, it must make a statement that the international community can see. In North America, South Korea and Japan, democracies are watching. They are wondering if the EU, the remaining stronghold of international cooperation, will stand against external influence or surrender to it.
They are asking whether representative governments can survive when the leading democratic nation in the world abandons them. They also see the example of Brazilian leadership, who confronted US pressure and demonstrated that the approach to deal with a bully is to hit hard.
But if the EU delays, if it continues to issue diplomatic communications, to levy token fines, to hope for a improved situation, it will have effectively surrendered.