The New Cold War is rapidly heating up, with severe consequences for people around the world. Our series, Briefings, provides the key facts on these matters of global concern.
The war in Ukraine has been accompanied by a strengthening of the US’s grip and influence on Europe. An important supply of Russian gas was replaced by US shale gas. European Union (EU) programmes originally designed to fortify Europe’s industrial base now serve the acquisition of US-made weapons. Under US pressure, many European countries have contributed to escalating war in Ukraine instead of pushing for a political solution to bring about peace.
At the same time, the US wants Europe to decouple from China, which would further reduce Europe’s global role and run counter to its own interests. Instead of following the US’s confrontational and damaging New Cold War agenda, it is in the interests of Europe’s people for their countries to establish an independent foreign policy that embraces global cooperation and a diverse set of international relations.
Europe’s Growing Dependence on the US
The Ukraine war, and the ensuing spiral of sanctions and counter sanctions, led to a rapid decoupling of EU-Russia trade relations. Losing a trade partner has limited the EU’s options and increased dependence on the US, a reality that is most visible in the EU’s energy policy. As a result of the war in Ukraine, Europe reduced its dependence on Russian gas, only to increase its dependence on more expensive US liquefied natural gas (LNG). The US took advantage of this energy crisis, selling its LNG to Europe at prices well above production cost. In 2022, the US accounted for more than half of the LNG imported into Europe. This gives the US additional power to pressure EU leaders: if US shipments of LNG were diverted elsewhere, Europe would immediately face great economic and social difficulty.
Washington has started pushing European companies to relocate to the US, using lower energy prices as an argument. As German Minister for Economic Affairs and Climate Action Robert Habeck said, the US is ‘hoovering up investments from Europe’ – i.e., it is actively promoting the region’s deindustrialisation.
The US Inflation Reduction Act (2022) and the CHIPS and Science Act (2022) directly serve this purpose, offering $370 billion and $52 billion in subsidies, respectively, to attract clean energy and semiconductor industries to the US. The impact of these measures is already being felt in Europe: Tesla is reportedly discussing relocating its battery construction project from Germany to the US, and Volkswagen paused a planned battery plant in Eastern Europe, instead moving forward with its first North American electric battery plant in Canada, where it is eligible to receive US subsides.
EU dependence on the US also applies in other areas. A 2013 report by the French Senate asked unambiguously: ‘Is the European Union a colony of the digital world?’. The 2018 US Clarifying Lawful Overseas Use of Data (CLOUD) Act and the 1978 US Foreign Intelligence Surveillance Act (FISA) allow US companies extensive access to EU telecommunications including data and phone calls, giving them access to state secrets. The EU is being spied on continuously.
Rising Militarisation Is Against the Interests of Europe
EU discussions on strategic vulnerabilities focus mostly on China and Russia while the influence of the US is all but ignored. The US operates a massive network of over 200 US military bases and 60,000 troops in Europe, and, through NATO, it imposes ‘complementarity’ on European defence actions, meaning that European members of the alliance can act together with the US but not independently of it. Former US Secretary of State Madeleine Albright famously summarised this as ‘the three Ds’: no ‘de-linking’ European decision-making from NATO, no ‘duplicating’ NATO’s efforts, no ‘discriminating’ against NATO’s non-EU members. Furthermore, in order to guarantee dependence, the US refrains from sharing the most important military technologies with European countries, including much of the data and software connected to the F-35 fighter jets they purchased.
For many years, the US has been calling for European governments to increase their military spending. In 2022, military spending in Western and Central Europe surged to €316 billion, returning to levels not seen since the end of the first Cold War. In addition, European states and EU institutions sent over €25 billion in military aid to Ukraine. Prior to the war, Germany, Britain, and France were already amongst the top ten highest military spenders in the world. Now, Germany has approved €100 billion for a special military upgrading fund and committed to spend 2% of its GDP on defence. Meanwhile, Britain announced its ambition to increase its military spending from 2.2% to 2.5% of its GDP and France announced that it will increase its military spending to around €60 billion by 2030 – approximately double its 2017 allocation.
This surge in military spending is taking place while Europe experiences its worst cost of living crisis in decades and the climate crisis deepens. Across Europe, millions of people have taken to the streets in protest. The hundreds of billions of euros being spent on the military should instead be redirected to tackling these urgent problems.
Decoupling from China Would Be Disastrous
The EU would suffer from a US-China conflict. A significant part of EU exports to the US contains Chinese inputs, and conversely, EU goods exports to China often contain US inputs. Tighter export controls imposed by the US on exports to China or vice versa will therefore hit EU companies, but the impact will go much further.
The US has increased pressure on a variety of EU countries, companies, and institutions to scale down or stop cooperation with Chinese projects, in particular lobbying for Europe to join its tech war against China. This pressure has borne fruit, with ten EU states having restricted or banned the Chinese technology company Huawei from their 5G networks as Germany considers a similar measure. Meanwhile, the Netherlands has blocked exports of chip-making machinery to China by the key Dutch semiconductor company ASML.
In 2020, China overtook the US’s position as the EU’s main trading partner, and in 2022, China was the EU’s largest source for imported goods and its third largest market for exported goods. The US push for European companies to restrict or end relations with China would mean limiting Europe’s trade options, and incidentally increasing its dependence on Washington. This would be detrimental not just to the EU’s autonomy, but also to regional social and economic conditions.
Europe Should Embrace Global Cooperation, Not Confrontation
Since the end of the Second World War, no single foreign power has wielded more power over European policy than the US. If Europe allows itself to be locked into a US-led bloc, not only will this reinforce its technological dependence on the US, but the region could become de-industrialised. Moreover, this will put Europe at odds not only with China, but also with other major developing countries, including India, Brazil, and South Africa, that refuse to align themselves with one country or another.
Rather than follow the US into conflicts around the world, an independent Europe must redirect its security strategy towards territorial defence, collective security for the continent, and building constructive international links by decisively breaking away from paternalistic and exploitative trade relations with developing countries. Instead, fair, respectful, and equal relationships with the Global South can offer Europe the necessary and valuable diversification of political and economic partners that it urgently needs.
An independent and interconnected Europe is in the interests of the European people. This would allow vast resources to be diverted away from military spending and towards addressing the climate and cost of living crises, such as by building a green industrial base. The European people have every reason to support the development of an independent foreign policy that rejects US dominance and militarisation in favour of embracing international cooperation and a more democratic world order.