As read by George Hahn. https://www.profgalloway.com/europe-becomes-a-union/ Learn more about your ad choices. Visit podcastchoices.com/adchoices
Chapter 1: What is the introduction to the podcast about?
I'm Scott Galloway, and this is No Mercy, No Malice. As President Trump upends the post-World War II order, it's finally dawning on Europe that it can no longer rely on America. Europe becomes a union, as read by George Hahn.
Chapter 2: How is Europe responding to Trump's policies?
The president is pulling back the security blanket that's protected Europe since 1945 and imposing 25% tariffs on steel and aluminum imports, claiming the European Union was formed to screw the United States. As the US upends transatlantic ties, the EU is awakening to the reality that its rich uncle has lost his shit and can no longer be trusted, much less depended on.
Chapter 3: What challenges does the EU face in becoming a union?
As dangerous as this is, we should ask, what could go right? This rift presents an opportunity for the EU to harness its economic strength and finally become a union. Skepticism is warranted. The bloc of 27 member states has a host of problems. Waning competitiveness against the U.S.
and China, lagging investment, costly regulation, lack of coordination, sclerotic decision-making, and political division. Only four of the world's top 50 tech companies are European, according to a report last year led by Mario Draghi. the former president of the European Central Bank. Without radical change, Draghi said Europe's reason for being is at risk.
Chapter 4: How is Europe planning to enhance its defense capabilities?
But with American brand equity eroding at a breathtaking pace, Europe could fill the void. Under Trump, the U.S. is caving to Russia, a murderous autocracy. The pre-orchestrated ambush of a democratically elected leader in Ukraine was a low point in American history.
Typical head-up-your-ass thinking from a leader who's decided to alienate allies, raise costs for American consumers, and reduce demand for our products overseas. The definition of stupid is harming yourself while harming others. These policies are stupid. So how should Europe respond? First, it's critical the EU significantly boost its spending.
Chapter 5: What financial strategies is Europe considering?
EU defense investment last year accounted for just 1.9% of its GDP, well short of the level of 3.5% that's needed to respond to today's existential crisis. Europe is finally getting serious about security.
Ursula von der Leyen, president of the European Commission, set out a plan to mobilize 800 billion euros for defense, including a 150 billion euro loan program to pay for weapons and technology, while Germany's chancellor-in-waiting, Friedrich Merz, stressed the need for independence from the U.S.,
Merz's center-right Christian Democrats and the leaders of his likely coalition partner, the center-left Social Democrats, have agreed to relax limitations on German borrowing and inject hundreds of billions into the country's military and infrastructure. A seismic shift in policy. Despite its numerous challenges, Europe has economic heft it can leverage.
Europe has a GDP 10 times the size of Russia's, but Putin is spending 40% more on the war than Ukraine and all its allies, including the US, combined. The next step is seizing more than 200 billion euros of frozen Russian assets held in Brussels. While the interest generated from those funds is being used to back a $50 billion loan to Ukraine,
European countries stopped short of confiscating the funds amid fears that it could breach international law and undermine trust in Europe as a place to invest. The risk to investment in the EU is dwarfed by the importance of setting a clear incentive to think twice before invading a neighbor.
It's worth noting that about £2.5 billion from the sale of Chelsea Football Club by Russian billionaire Roman Abramovich is just sitting in a bank account amid protracted talks about how the money will be unlocked. It's time to pull the trigger on the frozen funds. This would move the EU upstream of the policies of the US president and remove his leverage to force a surrender.
Another positive emerging from the chaos is stronger collaboration between the EU and the UK. Almost nine years after Britain voted to leave the bloc, one of the biggest self-inflicted injuries in history, the UK is moving closer to Europe again.
Prime Minister Keir Starmer has proposed forming a coalition of the willing to police any ceasefire in Ukraine, with his country ready to, quote, put boots on the ground and planes in the air, unquote. Britain has also shown support for a multilateral fund and joint military financing to fortify Europe's defenses.
At a time when European countries are already under financial pressure, pouring more money into defense will be painful. In the UK, Starmer has drawn fire over his plan to cut the foreign aid budget to fund the military.
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