The destiny of Europe has just lately changed into one thing of a Rorschach check for People. For the Trump administration and its allies, the continent represents a bastion of liberal decadence in terminal decline; the White Home’s current Nationwide Safety Technique warned of “civilizational erasure” in Europe and all however advocated for the dissolution of the European Union and the emergence of extra populist events and nationalistic member states. And but for a lot of People, Brussels represents the world’s final hope for regular and rules-based world management; many are cheering on its bid to strengthen its personal protection and financial capabilities, and to punch again towards Washington’s badgering.
However for a lot of Europeans themselves, there’s a cloud of pessimism that hangs over all this. They appear jealously towards the USA and its larger charges of financial development and world-beating expertise firms, and gripe concerning the EU’s glacial tempo of reform, lack of will, and divergent pursuits amongst member states. David Marsh writes Can Europe Survive? on this skeptical custom. The previous Monetary Instances European editor interviewed dozens of former officers to craft a well-written narrative historical past of key moments in Europe’s current previous—together with the evolution of German-Russian relations, Brexit, and the European debt disaster. He paints an total image of a Europe buffeted by a cyclone of inside and exterior pressures.
The destiny of Europe has just lately changed into one thing of a Rorschach check for People. For the Trump administration and its allies, the continent represents a bastion of liberal decadence in terminal decline; the White Home’s current Nationwide Safety Technique warned of “civilizational erasure” in Europe and all however advocated for the dissolution of the European Union and the emergence of extra populist events and nationalistic member states. And but for a lot of People, Brussels represents the world’s final hope for regular and rules-based world management; many are cheering on its bid to strengthen its personal protection and financial capabilities, and to punch again towards Washington’s badgering.
Can Europe Survive? The Story of a Continent in a Fractured World, David Marsh, Yale College Press, 528 pp., $35, November 2025
However for a lot of Europeans themselves, there’s a cloud of pessimism that hangs over all this. They appear jealously towards the USA and its larger charges of financial development and world-beating expertise firms, and gripe concerning the EU’s glacial tempo of reform, lack of will, and divergent pursuits amongst member states. David Marsh writes Can Europe Survive? on this skeptical custom. The previous Monetary Instances European editor interviewed dozens of former officers to craft a well-written narrative historical past of key moments in Europe’s current previous—together with the evolution of German-Russian relations, Brexit, and the European debt disaster. He paints an total image of a Europe buffeted by a cyclone of inside and exterior pressures.
The guide accommodates some useful reporting—notably on the European debt disaster—however finally ends up unsatisfactorily dodging the examination query of “whither Europe?” It additionally gives a hurried therapy of probably the most urgent challenges going through Europe in the present day. The deal with Germany’s fitful relationship with the Putin, Mario Draghi’s “no matter it takes” heroics to save lots of the euro, and Brussels’ wayward relationship with the U.Okay. are traditionally fascinating however really feel much less pressing as Europe stares down a risky and sometimes brazenly hostile Trump administration and a mercantilist China that’s hollowing out European trade (a subject which Marsh treats solely passingly).
Can Europe survive? Certainly it will probably—and can. Marsh’s existential (and negatively framed) title is considerably of a distraction. The true query is whether or not Europe will transfer on the velocity of relevancy to spice up its personal geoeconomic and geopolitical vitality, enabling it to behave as a forceful participant on the world stage quite than a sufferer of occasions. On this, the jury remains to be out, and there’s ample proof in both path.
A Spanish navy teacher (proper) trains a bunch of Ukrainian troopers on the Spanish Military base in Toledo, Spain, on Dec. 2, 2022, as a part of EU navy help to Ukraine amid the nation’s ongoing battle with Russia. THOMAS COEX/AFP/Getty Photos
For those who squint, the final 5 years seem like a march of European progress towards extra cohesion, stronger self-defense, and geopolitical assertion. One might simply inform a narrative of Europe rising to the event throughout a number of generational crises since 2020, repeatedly ending up in a greater place of extra integration and unity than it started. The COVID pandemic catalyzed Europe to collectively borrow 800 billion euros ($945 billion) as a part of its NextGenerationEU program, a present of fiscal pressure that crossed the beforehand brilliant line of pooling debt. The decision of Brexit was definitely risky, however left a extra integrationist core on the coronary heart of the EU.
And the invasion of Ukraine noticed Europe rally to Kyiv’s help in a approach that stunned outdoors observers: Brussels imposed sweeping sanctions towards Moscow and froze 210 billion euros in Russian central financial institution belongings, survived a beforehand unthinkable almost full shutoff in Russian fuel (which had accounted for 40 p.c of imports), and has furnished 201 billion euros in navy and monetary help to Kyiv, in comparison with 115 billion euros from the USA.
The second Trump administration has supplied one more near-existential jolt to the continent, threatening sky-high tariffs and even the annexation of Greenland—and once more Europe has taken dramatic motion in response. Germany introduced an infrastructure and protection plan that may very well be value as much as 1 trillion euros, smashing its debt brake (one more sacred cow) to spice up development and its personal navy capabilities. Europe launched a profitable 150 billion euros in collectively funded loans to member states for protection procurement as a part of its Readiness 2030 program, and earlier this month authorized a mortgage value 90 billion euros to maintain Kyiv within the battle via 2026 and 2027.
And that’s to not point out the 2024 Draghi report on enhancing Europe’s financial and geopolitical competitiveness and the flurry of related efforts to interrupt down inside boundaries and shield its personal financial pursuits—from the EU’s Competitiveness Compass to financial safety initiatives and progress on the financial savings and funding union plan to unify Europe’s notoriously fragmented capital markets. At the moment, all of Europe’s most vital leaders—whether or not Ursula von der Leyen in Brussels, Emmanuel Macron in Paris, or Friedrich Merz in Berlin—are dedicated to progress on additional integration and a extra sovereign and succesful Europe.
Even most of the tales Marsh tells depart the reader with a grudging religion in Jean Monnet’s well-known dictum that “Europe will likely be cast in disaster.” The extraordinary measures that Draghi took to save lots of the euro in the course of the debt disaster are living proof: In 2011, the euro was getting ready to collapse; in the present day, the euro has gained greater than 10 p.c on the greenback since Trump’s inauguration because the world views the one forex as an more and more dependable protected haven and the European Central Financial institution a mannequin of central financial institution independence and competency.
What’s to not like? Open your eyes a bit extra and the frustrations and challenges emerge. Take Russia. Europe fumbled the ball in December 2025 by refusing to grab Russia’s frozen belongings outright, a key check of political will on whether or not Europe would prioritize supporting Ukraine over inflated considerations concerning the affect of confiscation on Europe’s attractiveness for worldwide capital. If Europe can’t muster the metal to make use of Moscow’s personal cash to defend Kyiv, what does that bode for when Europe’s budgets get tight?
European Fee President Ursula von der Leyen talks concerning the EU Competitiveness Compass in Brussels on Jan. 29, 2025. MARTIN BERTRAND/Hans Lucas/AFP/Getty Photos
On producing European protection capabilities, the cash, so to talk, just isn’t the primary challenge. Since 2022, Europe’s protection spending has elevated an eye-watering 50 p.c, and the brand new NATO goal of three.5 p.c of GDP going towards protection budgets will, in idea, enhance European spending by lots of of billions a 12 months extra by 2035 if the political will for larger spending may be sustained.
The issue stays the way in which by which Europe is embarking by itself rearmament. Spending remains to be occurring in a largely distributed style throughout competing nationwide champions, with solely marginal progress in the way in which of shared platforms and planning that may generate scale. Furthermore, since 2022 an estimated 36 p.c of European protection contracts have gone to U.S. weapons. If Europe is severe about protection readiness, it must spend on the EU stage on shared methods and platforms inside Europe, probably utilizing joint EU funding quite than counting on nationwide budgets.
And doing so could have the ancillary advantages of enhancing financial and productiveness development. A rise in annual European protection spending from 2 p.c to three.5 p.c of GDP might raise GDP by 0.9 p.c to 1.5 p.c a 12 months, in response to the Kiel Institute, and each 1 p.c GDP enhance in protection spending can enhance long-term productiveness by 0.25 p.c. However that’s provided that Europe spends domestically and cohesively, quite than throughout a fragmented panorama of overlapping nationwide applications.
However maybe most vital—and pressing—is boosting Europe’s personal financial competitiveness. Let’s face it: Europe’s financial engine is puttering, not purring. The USA elevated actual GDP by almost 25 p.c between 2015 and 2024 in comparison with Europe’s 15 p.c, and Europe is projected to develop roughly 1 p.c decrease than the USA in 2026 and 0.6 p.c decrease in 2027. This disappointing image is essentially on account of lingering inside boundaries inside the single market—which the Worldwide Financial Fund estimates are equal to a 44 p.c tariff on intra-EU commerce in items and 110 p.c on providers—and the dearth of built-in and vibrant capital markets that may fund start-ups and scale innovation.
Unlocking this chance will likely be laborious. Mario Draghi meticulously laid out the roadmap in his 2024 competitiveness report, however implementing his suggestions—on the whole lot from creating extra pan-European firm champions to coordinated industrial coverage to harmonizing chapter legal guidelines—have been excruciatingly sluggish. Solely 11 p.c have been accomplished as of September 2025, one 12 months after the discharge of his report.
But this competitiveness agenda is maybe a very powerful merchandise on Europe’s plate. Bending the productiveness and development curve upward will give Europe enough weight to pursue its personal priorities on the worldwide stage, permitting it to push again towards China—or perhaps a bullying United States—by arming the continent with extra financial leverage. It can additionally assist to maintain the populists at bay via the salve of rising financial well-being.
Geoeconomic vulnerability has additionally led to a halting and disorganized strategy to China, which is maybe Europe’s greatest long-term exterior financial problem. Over the previous decade, China has flipped the script because it’s steadily climbed up the sophistication curve in trade after trade, with exports rising and imports flatlining: China went from a 100-billion-euro internet surplus with Europe in 2014 to round 300 billion euros in 2024, peaking at 400 billion euros in 2022. As China has eaten away market share in core European industries like autos, equipment, and chemical substances, the EU has achieved a woeful job placing up enough tariffs and different protections to stability out China’s personal subsidization of those sectors—partly as a result of potential of Beijing to efficiently play member states off of each other with the promise of funding and threats of duties. Except Europe develops a cohesive technique to face as much as China to guard its personal markets, China’s commerce surplus will solely develop and the lifeblood of Europe’s financial system will proceed to empty.
Former European Central Financial institution President Mario Draghi addresses the viewers throughout a convention titled “One Yr After the Draghi Report” on the EU Charlemagne constructing in Brussels on Sept. 16, 2025. Omar Havana/Getty Photos
If Europe doesn’t transfer shortly, it dangers not solely one other decade of underwhelming financial development and being knocked round by the likes of Washington and Beijing; it dangers a populist revolt that may sluggish the momentum towards cohesion and maybe reverse it. Proper now, there exists a constellation of constructive leaders on the coronary heart of Europe rowing laborious within the path of cohesion reform and protection sovereignty. After the French presidential election in 2027, which the far-right Nationwide Rally might win, and German elections in 2029 on the newest, the political panorama may very well be a lot much less propitious.
A extra difficult query is how a lot Europe ought to moderately de-risk from a post-Trump United States. Spending extra and cohesively on protection is a given, however ought to Europe embark on a long-term and expensive endeavor to construct parallel methods for space-based intelligence, surveillance, and reconnaissance quite than rely upon Washington? Equally, how sensible is the drive towards expertise sovereignty and the event of European champions in areas like cloud computing, the place the USA has a close to insuperable benefit? Sadly, Marsh leaves these vital questions unasked and unanswered.
The excellent news for Europe is that changing into a greater and extra useful ally to the USA over the long term, establishing extra geopolitical independence, and standing as much as China and a revanchist Russia all require the identical basic playbook: breaking down inside market boundaries, making extra progress on capital markets union, establishing a sturdy financial safety framework, and creating an impartial and cohesive protection functionality. Uniquely to Europe, these reforms current a well-understood—albeit politically difficult—alternative to supercharge development. No different main market—together with the USA—has such simply identifiable financial boosters obtainable.
In brief, alternative beckons for Europe and the query just isn’t whether or not the continent can survive; it’s whether or not Europeans can muster the political will and urgency to fulfill the second.
