Europe Must Choose Its Rivals

In March 2025, the White House informed about its war plans by accident. A journalist had been added, apparently in error, to a Signal chat in which senior American officials discussed strikes on Houthi positions in Yemen, and somewhere in the operational detail sat something more revealing than any communiqué, an open contempt for European allies who use the Red Sea’s shipping lanes without, in Washington’s reading, paying for the privilege. Nobody in that chat expected Brussels to read it, which is why the contempt was so unguarded. It communicated, more directly than diplomacy usually allows, how the current American government ranks its European partners, useful sometimes and beneath serious respect.

There is a name for this. In an attempt at framing a right-wing populist foreign policy I call it chaotic hypocrisy, a play on Stephen Krasner’s older idea of sovereignty as organised hypocrisy, the observation that states break the rules of sovereignty constantly while proclaiming them loudly. Chaotic hypocrisy is the same manoeuvre without the organisation. It describes an ally pursuing genuine, defensible interests through methods so erratic that nobody downstream can tell whether they are being coerced, courted or simply forgotten about until the next tariff announcement.

The temptation in Brussels is to treat this as a personality problem, one that resolves itself once a different government moves into the White House. It will not.

The National Security Strategy Washington published in December 2025 rests on four pillars — sovereignty from critical dependencies, industrial security, technological advantage and military overmatch — that predate Donald Trump and will outlast him. Jake Sullivan, national security adviser to Joe Biden, described the same underlying instinct in his 2023 Brookings address as a “foreign policy for the middle class” – a term coined in 2020 in a Carnegie Endowement report he coauthored. Scott Bessent, months before becoming Trump’s Treasury secretary, made a structurally similar case from the other side of the aisle. Both agree on the point that economics has become an instrument of security policy in Washington, not a separate track running alongside it.

Until now Europe has had no equivalent conviction, which is why the Liberation Day tariffs announced on 2 April 2025 produced four different European reflexes within days. Ursula von der Leyen chose accommodation, offering to help adjust the global trading system while keeping retaliation on the table. Donald Tusk was cooler, insisting that real partnership meant, in his words, “genuinely and honestly reciprocal tariffs”, and putting the burden of proof back on Washington. Emmanuel Macron pushed further, telling French investors that pending American commitments should wait until matters were clarified. Giorgia Meloni, whose country runs a trade surplus with the United States, called the tariffs a mistake without picking a side.

Four capitals, four postures and no shared answer to the only question economic statecraft turns on: ally or rival? That question cannot be dodged by staying neutral, because neutrality is not on offer. Weak political actors get leaned on regardless of who is doing the leaning. That is structural dependency, and not personal preference.

It has also been exploited in regards to Europe by China for much longer. Beijing’s manufacturing overcapacity, in solar panels, electric vehicles, batteries and now rare-earth processing, is the product of industrial policy set decades ago by the Communist Party of China and aimed at dominating export markets, and an unaligned Europe is the largest such market available. China’s decision to restrict rare-earth and magnet exports to buyers linked to foreign militaries, effective from 1 December 2025, may not have been aimed explicitly at punishing Europe, though it coincided with the EU’s first attempts to respond to China’s growing use of trade as leverage without confronting Beijing directly. The point is that China did not need to be explicit. An economy with no doctrine about who it stands with and who it opposes absorbs pressure from every direction by default, friend and rival alike, because it has given nobody a reason to expect anything else. Until European leaders confront China from a shared position grounded in an aligned, cohesive strategic mindset, every EU response will arrive late and lose.

The pressure is not only external, and not only strategic drift. Part of it is European complicity—a story still unfolding as the European Parliament debates the final shape of its new report on China. The standard account of how Europe slept through China’s rise tells only half the story; the other half is that European corporate actors did not merely fail to notice but actively enabled Beijing’s state-led economy, lobbying at home against every attempt to re-adjust China policy. Thorsten Benner, writing in Foreign Affairs, frames the resulting confrontation as a clash Europe can no longer avoid, with a China shock 2.0 now threatening the advanced sectors, automotive, machinery, chemicals, pharmaceuticals and green energy, on which the continent’s prosperity rests. And the frontline is already visible. At Citribel in Tienen, one of only two remaining citric-acid plants in Europe, subsidised Chinese competition has driven prices about 40% to 50% below the plant’s cost price and halved its sales since 2019, according to the Financial Times.

Washington has noticed the self-harm too, and named it. Its 2025 National Security Strategy (widely contested in Europe) observes that the war in Ukraine has perversely deepened Europe’s, and especially Germany’s, external dependencies, noting that German chemical companies are building some of the world’s largest processing plants in China using Russian gas they can no longer obtain at home. The obvious referent is BASF, which took the final investment decision on the main construction phase of its Zhanjiang Verbund site, a facility worth up to €10bn and the company’s largest investment ever, in July 2022, months after Russia’s full-scale invasion had begun to sever European access to Russian gas.

Companies that profit from China will not volunteer to limit their exposure to it. Left alone, they will keep deepening the very dependencies a European doctrine would need to constrain.

For all that, Washington remains indispensable even while behaving badly. Its chaotic hypocrisy is real, and expensive, and worth naming honestly rather than laundering into diplomatic language. But it comes bundled with a security guarantee that Beijing’s overcapacity does not, and with an industrial and financial system — dollar dominance, sanctions reach, control of the advanced semiconductor supply chain — that no other partner can currently substitute. In a hostile world of rivals Europe currently sits in a favourable position, its key partnership backed by the global reach of the United States. It may not be a dream alliance for either party — the Signal chat showed that, and so did Meloni’s public complaint on Instagram and X, asking why the president of the United States behaves this way towards his own allies. Much of the commentary expected this to end NATO in all but name. Nothing of the sort has happened.

The NATO alliance stands, despite bad blood, and if it is chosen to be continued it brings known costs but also both economic and security benefits. It is also a sound political strategy to have voters confirm support for a long-term economic security strategy over the next cycles of the democratic process, rather than drift into it by default because the alternative looked worse on the day.

That last point deserves weight, because a bolder strategic posture will not be cost-free, and its costs will fall on voters, in prices, in adjustment and in the risk of Chinese retaliation. Benner is right that the public must be persuaded that trade defence is a necessary economic adjustment to a hostile environment, not a reckless picking of fights. But the case cannot rest on democratic values alone. The more durable argument is security. Europe is being asked to keep its market open to a state that is not a neutral commercial competitor but an active enabler of the war on its own continent. China is not only profiting from wartime demand for critical components; it is investing directly in Russian military capacity.

In November 2025 the Financial Times documented the first known case of Chinese equity in a sanctioned Russian arms maker, a Shenzhen drone-parts owner taking a 5% stake in Rustakt, the largest importer of first-person-view drone components for Russia’s war, with hundreds of millions of dollars in Chinese batteries, motors and controllers flowing to the same production lines. Ukrainian military intelligence has confirmed Chinese machine tools, gunpowder, chemical products and components reaching at least 20 Russian defence plants, and estimates that about 80% of the critical electronics in Russian drones originated in China as of early 2025. A doctrine that names China a rival is not an abstraction about values; it is a statement about who is arming the artillery and drones aimed at Europe’s eastern flank, and voters can be asked to carry costs for that.

That is where the Economic Security Strategy the Commission’s trade department announced in late 2025 falls short, not on competence but on authorship. Read closely, it is a sophisticated document, written by officials who know the material, and who are now applying it against the tides of global economic conflict. It does the analytical part very well, identifying many of the G7 nations’ economic security playbooks, from foreign-subsidies control, anti-coercion measures and outbound-investment screening to critical-raw-materials governance, all coherently drafted. Yet it lacks a political parent.

The strategy was not written as the economic expression of a prior decision about who are friends, who are rivals and who is everything in between. It was written by the department responsible for trade policy, doing what trade departments do competently, which is to regulate flows and find adaptations to irregularities. But it is not anchored in any prior political decision — one that need not be set out on paper, but that would express a common political will clearly.

Europe has no such decision, despite some efforts. In March 2026 Sven Biscop argued that Europe should build its next grand strategy as a new European Security Strategy. That political orientation is badly needed if the economic-security strategy is not to be reduced to a mere flow regulator. Economic-security policy should be a statement of who the flows are meant to protect and who they are meant to constrain, made by the institutions responsible for security and foreign policy, with trade instruments arriving afterwards as the operational layer.

Real economic statecraft, the kind practised with coherence in Washington and Beijing, always works in that order: security judgement first, tools second. Europe has built the tools without ever holding the argument that should have preceded them. The result is a continent that reaches for foreign direct investment (FDI) screening, tariffs and sanctions the way a household reaches for whichever tool is nearest — competently, but without first asking what the repair is for.

There is, of course, a world beyond China, and Europe is right to be building it, reaching towards Taiwan, India and other partners able to supply what it would otherwise import from a rival. The caveat is that reach is not a strategy on its own. Europe will need to watch whether those same partners are themselves sliding into dependence on Chinese capital, components and market power, rather than offering a way out of it.

Another strategy document from the Commission’s trade department will not fix the main problem, however well the next one is drafted. What is missing is a mandate from the core of the European Council: the will to pick a fight. Only then will the European institutions be able to produce a grand strategy that names its fundamental categories plainly. It must be clear about which states are treated as allies, which sit in the large grey zone that has to be managed case by case and whose behaviour Europe will tolerate at a cost, and which are treated as rivals to be constrained regardless of the price. Everything currently filed under economic security — the Critical Raw Materials Act, the Foreign Subsidies Regulation, the Anti-Coercion Instrument, Security Action for Europe — should sit beneath it as operational chapters, not stand in for it.

As things stand a patch, however well made, is still a patch. Europe needs to decide who it is defending from before it decides how.

The objection writes itself. Europe’s ambiguity is a consequence of arithmetic where 27 governments have different commercial exposures and no single interest strong enough to bind them. Germany reads China through its industrial interests, Italy reads the United States through its trade surplus and security dependence. No common commercial calculation will erase those differences. Each capital reads the ally-or-rival question through its own trade balance and if kept that way would be a bad political prediction; EU’s overall weakness is often attributed to lack of own strategic foresight. 

But Europe does share one interest that is larger than any trade balance. The war on its eastern flank threatens every member state, and the Russian weapons sustaining that war depend heavily on Chinese components. That is why Europe’s economic-security doctrine must be made by institutions responsible for security, not trade. On the question of war and peace, twenty-seven divergent perspectives may yet become one.