Europe's Covert Instrument to Address Trump's Economic Coercion: Time to Activate It

Can Brussels finally stand up to the US administration and American tech giants? Present passivity goes beyond a regulatory or economic shortcoming: it constitutes a moral failure. This inaction throws into question the very foundation of the EU's political sovereignty. The central issue is not only 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.

How We Got Here

To begin, consider how we got here. During the summer, the EU executive accepted a one-sided agreement with the US that locked in a ongoing 15% tax on EU exports to the US. Europe received nothing in return. The embarrassment was all the greater because the EU also consented to direct more than $1tn to the US through financial commitments and purchases of resources and defense equipment. The deal revealed the fragility of the EU's dependence on the US.

Less than a month later, Trump warned of crushing additional taxes if the EU enforced its regulations against US tech firms on its own territory.

The Gap Between Rhetoric and Action

For decades Brussels has asserted that its market of 450 million rich people gives it unanswerable leverage in international commerce. But in the six weeks since Trump's threat, the EU has taken minimal action. Not a single counter-action has been taken. No activation of the new trade defense tool, the so-called “trade bazooka” that the EU once vowed would be its ultimate protection against foreign pressure.

By contrast, we have diplomatic language and a penalty on Google of under 1% of its yearly income for established anticompetitive behaviour, already proven in US courts, that allowed it to “exploit” its market leadership in the EU's advertising market.

US Intentions

The US, under the current administration, has made its intentions clear: it no longer seeks to support European democracy. It aims to undermine it. An official publication released on the US Department of State's platform, written in paranoid, bombastic rhetoric reminiscent of Hungarian leadership, charged Europe of “an aggressive campaign against democratic values itself”. It criticized alleged restrictions on political groups across the EU, from German political movements to PiS in Poland.

The Solution: Anti-Coercion Instrument

What is to be done? Europe's trade defense mechanism works by assessing the extent of the pressure and applying counter-actions. Provided EU member states consent, the European Commission could kick US goods and services out of Europe's market, or impose tariffs on them. It can strip their intellectual property rights, prevent their investments and require compensation as a condition of re-entry to Europe's market.

The tool is not merely financial response; it is a declaration of political will. It was created to signal that Europe would always resist external pressure. But now, when it is needed most, it remains inactive. It is not a bazooka. It is a symbolic object.

Internal Disagreements

In the period leading to the transatlantic agreement, many European governments used strong language in official statements, but failed to push for the instrument to be used. Some nations, including Ireland and Italy, publicly pushed for a softer European line.

A softer line is the last thing that the EU needs. It must enforce its regulations, even when they are challenging. Along with the anti-coercion instrument, Europe should disable social media “for you”-style algorithms, that recommend content the user has not requested, on European soil until they are proven safe for democracy.

Comprehensive Approach

Citizens – not the algorithms of foreign oligarchs beholden to external agendas – should have the autonomy to decide for themselves about what they view and distribute online.

Trump is pressuring the EU to water down its digital rulebook. But now more than ever, Europe should make American technology companies accountable for anti-competitive market rigging, surveillance practices, and preying on our children. Brussels must ensure Ireland accountable for failing to enforce EU online regulations on American companies.

Enforcement is insufficient, however. The EU must progressively replace all non-EU “major technology” services and computing infrastructure over the coming years with homegrown alternatives.

The Danger of Inaction

The significant risk of this moment is that if Europe does not act now, it will never act again. The longer it waits, the deeper the erosion of its confidence in itself. The increasing acceptance that opposition is pointless. The greater the tendency that its laws are unenforceable, its institutions not sovereign, its political system dependent.

When that happens, the route to undemocratic rule becomes unavoidable, through automated influence on social media and the acceptance of lies. If the EU continues to cower, it will be drawn into that same decline. Europe must take immediate steps, not only to push back against Trump, but to establish conditions for itself to exist as a independent and sovereign entity.

Global Implications

And in taking action, it must make a statement that the rest of the world can see. In Canada, Asia and Japan, democratic nations are watching. They are wondering if the EU, the remaining stronghold of international cooperation, will resist external influence or yield to it.

They are inquiring whether democratic institutions can survive when the leading democratic nation in the world abandons them. They also see the model of Brazilian leadership, who faced down Trump and showed that the way to deal with a bully is to respond firmly.

But if the EU hesitates, if it continues to release polite statements, to levy token fines, to anticipate a better future, it will have effectively surrendered.

Jessica Smith
Jessica Smith

A tech enthusiast and writer passionate about exploring how innovation impacts society and drives progress.