When historians look back on the “great unravelling” — whether of the post-second world war order or the transatlantic alliance — they will probably identify a series of policy choices made by President Donald Trump. But in reality, the fraying of the alliance may turn out to be more about decisions taken in Europe.
European choices matter and the key is how the bloc uses its agency. There are four major tests ahead.
First, Europe must be realistic about the threat it faces. The war in Ukraine has shown growing co-operation between Russia, China, Iran and North Korea. The emergence of a network of revisionist powers whose activities span regions means that Europe must accept the imperative of aligning with the US. Washington may be a frustrating partner at times, and debates over burden-sharing and troop levels are real. But “strategic autonomy” is not an option.
Second, Europe needs to reset its approach towards China. Recent European Commission discussions concluded that the EU’s relationship with Beijing was “not sustainable”. The shift is welcome, but the postures adopted by member states remain uneven. France often favours a tougher approach; Germany often seeks to protect its commercial ties; and Hungary continues to welcome Chinese investment.
Third, like the US, Europe needs to get on a war footing in terms of defence, not to satisfy the Americans but to secure itself.
If Europe rebuilds defence capabilities outside Nato structures, it will deepen the fractures in the transatlantic alliance. Interoperability — the ability to fight as a single force — is one of Nato’s greatest advantages. It took decades to build, and still remains incomplete, which is a testament to its difficulty. The key for Europe is to build on the capabilities and operational experience it has already developed through the alliance, not duplicate them outside of it.
Fourth, Europe can choose a growth agenda based on transatlantic connections. The economic strength of the west depends on both the US and Europe. The US accounts for roughly a quarter of global GDP, while the EU remains one of the world’s largest economic blocs. But Europe’s share of global output has been declining. Reversing relative economic decline and generating stronger growth, investment and industrial capacity will require smart choices in three areas largely within Europe’s control: regulation, energy and innovation.
As the Draghi report argued, Europe’s regulatory environment has contributed to weak productivity growth, lagging innovation and lower investment. Meanwhile, high energy costs continue to undermine European industrial competitiveness. Europe can take steps to stabilise energy prices and secure supplies. Part of that effort could be greater access to long-term liquefied natural gas contracts linked to US Henry Hub prices. The price stability provided by long-term contracts could significantly reduce energy costs.
The ability to develop and scale AI will be equally important. Europe can continue to prioritise regulations, or it can accept greater risk. The question is whether it is prepared to make the trade-offs necessary to compete.
Large amounts of affordable and reliable energy are necessary to rebuild industrial capacity and grow AI. Europe’s choice is between dependencies, like that on Russian gas, that create strategic vulnerability and relationships that reinforce resilience. Long-term energy co-operation with the US falls into the latter category.
The gaps between the US and Europe did not begin with Trump. They have been widening for years. If left unaddressed, these imbalances will steadily weaken the alliance. Europe can address them with its choices: on whether to build defence capabilities through Nato or parallel European structures; how to approach technological regulation; how to pursue growth; and how to address shared security threats. These choices will shape not only Europe’s future but the future of the transatlantic alliance.
Pursuing forms of strategic autonomy that create greater distance between Europe and the US may offer the appearance of independence, but it risks weakening the bonds that have underpinned transatlantic security and prosperity for decades.
The transatlantic partnership has survived repeated political disagreements, policy disputes and changes in leadership. It can do so again. But that happy outcome is not inevitable. It will depend on decisions made not just in Washington but in European capitals too.