Why market integration without political power leaves Europe dependent
In January 2025, the U.S. President redeclared interest in acquiring Greenland—by force if necessary. Europe’s response was instructive: twenty-seven foreign ministries issued twenty-seven statements. So did European institutions. Some statements were stern, some conciliatory. None mattered. The continent with 450 million citizens and a GDP rivaling America’s spoke with the geopolitical weight of a trade association.
This wasn’t anomalous. It revealed a pattern now impossible to ignore: Europe, as currently constituted, lacks the institutional capacity to act as a sovereign power in a world of empires. For decades, “European federalism” was dismissed as fantasy or threat. Today, that framing is breaking down across the political spectrum—driven not by ideology but by geopolitics.
Convergence Across the Spectrum
On the left, proponents of “social federalism” argue Europe cannot regulate global capital, sustain industrial policy, or finance the green transition without federal-level fiscal tools. Crucially, this is framed as geopolitical: a politically weak Europe is a subordinate Europe. (Social Europe)
At the center, Mario Draghi insists Europe must acquire genuine executive capacity in strategic domains—finance, industry, energy, security—to avoid becoming a rule-taker. Josep Borrell and Enrico Letta call for a European “declaration of independence.” (El País)
On the right, voices like Dalibor Roháč argue Europe needs “a new union” because the market-only model leaves it exposed. Manfred Weber calls for centralized EU executive power. Even traditionally euroskeptic actors acknowledge that individual nation-states lack the scale to defend European interests. (AEI)
The Defense Imperative
The Ukraine war exposed Europe’s dependency brutally. Arsenals depleted within months. Ammunition production couldn’t scale. Critical systems required American approval. A continent with twice Russia’s population couldn’t deter aggression at its border without U.S. logistics and intelligence.
Twenty-seven separate defense industries cannot compete with integrated military-industrial complexes. European NATO members spend €300+ billion annually yet lack autonomous capability. Under a Trump administration openly hostile to NATO commitments, this dependency became a crisis. European defense autonomy isn’t luxury—it’s survival.
A unified defense framework would transform the EU from regulatory power to geopolitical actor. But defense cannot be executed by committee—it requires federal decision-making authority.
Federalism in Practice
Policy is already moving federally. Europe pushes for payment infrastructure independent of U.S.-controlled Visa/Mastercard—framing financial systems as strategic autonomy. The EU Chips Act, Critical Raw Materials Act, and Net-Zero Industry Act represent federal-type industrial policy in all but name. Joint borrowing, coordinated industrial policy, common defense procurement—all point toward centralized capacity as survival condition.
Europe is federalizing in practice because the alternative is dependence. The question: will this be democratic and transparent, or technocratic and opaque?