The European Union is facing an existential crisis

The most successful historical cycle in Europe, which began with the Marshall Plan in 1947 and the launch of European integration in the 1950s, has now reached its most critical point. All signs indicate that this cycle is rapidly approaching its end, and the biggest question is: where is a united Europe heading?

Today, we are facing the threat of across-the-board 30% tariffs from the United States, while at the same time experiencing an appreciation of nearly 15% in the euro against the dollar since the beginning of the year. Meanwhile, European industry is being asked to become more "competitive," despite bearing the burden of energy prices (natural gas and electricity) that are three times higher than those in the U.S.

How is the European Commission addressing these combined challenges, which threaten to cause lasting damage to the economy in general, and to the highly valuable export sector in particular?

By proposing a horizontal tax (of unknown size) on businesses and an additional €14 billion tax burden on tobacco products — all to strengthen its budget.

Unfortunately, it is becoming increasingly clear that the leaders of European policy appear unable or unwilling to acknowledge reality.

Today, the trade war announced by President Trump against the EU coincides with the overall rearmament of NATO member states — a choice aimed primarily at permanently abandoning the rigid fiscal austerity imposed by the Stability Pact. The reactions — or rather, the lack thereof — to Trump's aggressive barrage of tariffs, which are announced, multiplied, and then scaled back, in themselves constitute seeds of destabilization.

Now almost exclusively focused on ramping up defense spending — a move that will either remain on paper or dramatically erode the welfare state if not accompanied by broader growth initiatives — the European Commission appears to have been "negotiating" for months with the U.S. over a mutually beneficial trade agreement. However, this has yielded no tangible results, apart from growing frustration on the other side of the Atlantic.

Meanwhile, grandiose statements and often aggressive “leaks” lacking substantive content seek to distract from the harsh reality.

Historically, the EU has always moved forward through crises — this was the essence of Europe’s voluntarism. Today, however, integration has lost its forward momentum. Europe’s growing geopolitical irrelevance threatens to go hand-in-hand with economic and entrepreneurial disintegration. Not due to a lack of objective capabilities, but because these are being stifled by unrealistic bureaucratic policies and one-dimensional ideological obsessions.

Ultimately, this reveals one thing: an inability to comprehend the real geopolitical and economic conditions facing Europe in relation to the United States and the rest of the world — despite the ongoing series of serious events that highlight the seismic shifts underway.

The first thing Europe must do — urgently and effectively — is to negotiate a new trade agreement with the United States, with whom it maintains a significant trade surplus, thereby avoiding escalation and empty threats.

The second, is to adopt the Draghi-Letta proposals to enhance competitiveness and establish a truly unified and effective internal market, instead of inventing new ways to burden businesses.

Let us not deceive ourselves: the long-anticipated existential crisis of the European Union is no longer approaching — it is already here. It is a multi-dimensional crisis, touching on economic competitiveness, geopolitical influence, and social cohesion, with significant political consequences that pose a danger to the EU's future.

This crisis will not be resolved through wishful thinking or knee-jerk reactions.