The US-EU Trade Deal of 2025: A Pivot Toward Resilience, But at What Cost?

The US-EU Trade Deal of 2025: A Pivot Toward Resilience, But at What Cost?

The US-EU trade agreement of July 2025 is not just a recalibration of tariffs and quotas—it’s a bold acknowledgment that advanced economies are prioritizing national resilience over the dogma of unfettered globalism. In a world of weaponized supply chains and geopolitical flux, this deal reflects a pragmatic shift toward sovereignty, but its benefits and costs are unevenly distributed. For the United States, it’s a strategic win; for Europe, it’s a fragile compromise that masks deeper vulnerabilities.

A Triumph for the United States

For the US, the deal is a masterstroke of economic and geopolitical strategy. By securing increased access for energy exports—potentially worth hundreds of billions over the next decade—and attracting European investment in manufacturing and AI, the agreement bolsters key sectors. It’s not just about dollars. It’s about reversing decades of offshoring that hollowed out industrial heartlands. Towns in Ohio and Michigan stand to gain from reshored factories, supported by pro-business policies and cheap domestic energy. The deal also cements US energy dominance, with LNG exports to Europe projected to reach 25% of EU gas supply by 2030, reducing reliance on volatile suppliers.

Critics argue that tariffs risk inflation and higher consumer prices. They’re not wrong—US import prices could rise by 2–3% in the short term. But for many Americans, stable jobs and national security outweigh marginal cost increases. The working class, long sidelined by coastal elites chasing efficiency, finally sees policy aligned with their needs.

Europe’s Precarious Truce

Europe, by contrast, has secured a tactical reprieve rather than a strategic victory. By averting a tariff war, the EU protects its export-driven economies, particularly Germany’s automotive sector (€250 billion in exports annually) and Ireland’s pharmaceuticals. Zero tariffs on semiconductors and aviation preserve high-value industries, while increased US LNG imports support energy diversification, cutting reliance on Russian gas (down to 8% of EU supply in 2024). Yet these gains come at a cost. Europe’s industries face structural pressures: German manufacturers grapple with energy costs 2–3 times higher than in the US, while Central European suppliers risk losing ground to American competitors offering lower costs and subsidies.

Wealthier EU states like Germany and the Netherlands may absorb these shocks, but southern and eastern Europe—already strained by high debt (e.g., Italy’s 140% debt-to-GDP ratio) and lower wages—face growing risks. Rising living costs, with inflation at 2.5% in 2025, hit households hard, particularly in Greece and Romania, where real incomes have stagnated. The deal’s focus on large industries overlooks small and medium enterprises, which employ 60% of EU workers and struggle with trade compliance costs.

Moreover, the agreement deepens Europe’s dependence on US energy, trading one external reliance (Russia) for another. This is not sovereignty restored but deferred. The EU’s push for renewables under the European Green Deal—aiming for 45% renewable energy by 2030—offers a path to self-reliance, but progress is uneven, and the deal does little to accelerate it.

The Bigger Picture: Sovereignty, China, and Society

This deal is not about economic optimality; it’s about geopolitical realism. Tariffs and industrial policies may distort markets, but they build resilience in a world where supply chains are strategic weapons. Both the US and EU are responding to China’s dominance in critical goods like semiconductors and rare earths. A true transatlantic partnership would align on reducing China’s leverage, perhaps through joint investment in chip production or green tech.

The deal also sidesteps digital trade and data privacy, where US-EU tensions (e.g., GDPR vs. US tech giants) remain unresolved. Without progress here, the agreement misses a chance to shape the digital economy. Socially, Europe risks further fragmentation. Economic strain in southern and eastern member states could fuel populist movements, as seen in Italy and Hungary, undermining EU unity.

A Necessary but Incomplete Step

The US-EU trade deal of 2025 marks the end of naive globalism and the return of strategic pragmatism. For the US, it’s a step toward industrial revival and energy dominance. For Europe, it’s a pause that preserves stability but exposes long-term vulnerabilities. To compete, the EU must double down on self-reliance—through affordable energy, diversified supply chains, and support for SMEs—while addressing social discontent to prevent political fracturing.

Economic inefficiencies may arise, but in a world of strategic decoupling, sovereignty is not a luxury—it’s a necessity. The US has seized this moment; Europe must find the courage to do the same, lest it remain a market bloc tethered to external powers. This deal is not the final chapter but a call to action for both sides to redefine prosperity in an age of uncertainty.

Rob Roos is a distinguished fellow at the Gold Institute for International Strategy, a Washington, DC-based think-and-do tank.

The Threat from Within

Some people get emotional when delivering closing remarks at a security conference, but I assure you, I will not be one of them.

At the Munich Security Conference last week, Christoph Heusgen, the event chair, was so shaken by JD Vance’s speech that he was moved to tears. And he wasn’t alone. The audience reacted with shock, disbelief, and unease. Why? Because JD Vance’s words forced them to face a reality they have ignored for decades.

Vice-President Vance stated: “The threat that I worry the most about vis-a-vis Europe is not Russia, it’s not China, it’s not any other external actor. What I worry about is the threat from within. The retreat of Europe from some of its most fundamental values. Values shared with the United States of America.”

Vance was speaking about our Western values—freedom, sovereignty, and prosperity.

External threats exist, and we must take them seriously. We spoke about that today. But before we can resist these dangers, we must first address the internal threats—those who reject their own nations, dismantle our free markets, erode traditional families, and push for open borders, inviting radical ideologies that threaten our way of life. They cripple our energy independence, suffocate economies, and advocate absurdities, like the notion that men can bear children. These are the same people who claim

the EU was founded for peace yet panic when President Trump speaks of ending war in Europe.

The Trump administration’s message is clear: The U.S. wants to cooperate with Europe, but Europe must first clean up its own mess.

That message is to us. Our mess is the left-liberal bureaucracy—the overregulated EU dismantling our energy and food systems, crippling our economies, and flooding Europe with unchecked migration.

The Trump administration is willing to work with us, but not with EU bureaucrats who created this chaos. As JD Vance said: “If you’re running in fear of your own voters, there is nothing America can do for you.”

We, we must be strong. Conservatives often underestimate the left’s deeply entrenched power. Winning elections is not enough. It’s just the beginning, and time is short.

Consider our colleagues of Poland’s Law and Justice party. They held power for eight years but failed to uproot leftist influence. Now, the left liberals have returned stronger than ever. We saw this in Brazil after Bolsonaro, in the U.S. after Trump’s first term, and even in Hungary before Orbán secured his grip. But he learned, fought back, and took decisive action.

As the saying goes: You have to lose to know how to win.

So, let me be clear and I’m not holding back: When we return to power – each of us – we must dismantle the corrupt left-liberal network. We must defund their institutions and militant NGOs, expose their corruption, replace national broadcast leadership, secure free speech, promote our cultural heritage, control our borders, reclaim education, cancel harmful international treaties, restore reliable and affordable energy, and cut through EU bureaucracy.

This is exactly what President Trump is doing now. He has built a team of exceptional individuals, learning that time is limited and the left’s influence runs deep. We must be equally prepared and act decisively when our moment arrives. Leftist corruption must be uprooted completely. It must be eradicated, root and branch.

Beyond governance, we must protect our farmers—the stewards of our land—who provide natural, healthy food. As Robert F. Kennedy Jr. wisely said: “We can have a thousand wishes, but if you are ill, you have only one wish left.”

We, as conservatives, understand this. Our modern Western culture has distanced itself too much from nature. That is why the Make America Healthy Again movement is as crucial as Make America Great Again.

And the same applies to Europe. We also have people of the MAHA movement here today and they are working to bring MAHA to Europe later this year. Alongside Make Europe Great Again, let us also Make Europe Healthy Again. A sound mind resides in a healthy body, and a healthy nation depends on the well-being of its people.

It is up to us to restore true democracy by making ‘We the People’ the focus of governance. And ‘by us’, I mean patriots—those who love their countries, cherish our continent and honor our cultural heritage. Those who respect the achievements of our ancestors and want to pass on peace and prosperity to future generations. Good governance can only come from a place of deep national love. It must come from the heart.

We must secure our freedom, economy, and security. Only then will Europe be a strong partner for the U.S. in this new era of MAGA. This is how we Make Europe Great Again.

Ladies and gentlemen, on behalf of the Gold Institute for International Strategies and as the former Vice President of New Direction and the ECR, I sincerely thank you for your engagement today. Staying connected and supporting each other is essential.

And, as promised—I am not crying. We are at a pivotal moment in history, and I am filled with optimism. The future is bright, and I cannot stop smiling. Let’s enjoy lunch, then get to work reclaiming our nations and our future.

Thank you very much.

Hon. Rob Roos is a Distinguished Fellow at the Gold Institute for International Strategy, a Washington D.C.-based foreign policy and defense think tank.

Fit-for-55 is an irresponsible experiment with our economy

For decades now our Western society has made a success out of democracy and an economy based on free market forces. It is no coincidence that the two go hand in hand, because in an environment where people have the freedom to think and act, innovation and progress arise. Another key component of this success was affordable and reliable energy. The prosperity that these three components have brought us has also ensured that we have made great strides in improving the environment and living standards especially in the Western part of Europe.

But the economic freedom that has brought us so much may well be over. Today, ‘Fit for 55′ is presented as part of Frans Timmermans’ Green Deal, a mega package of legislation from the European Commission to ‘green’ the economy.

Updates to existing EU laws:

● Revision of the EU emission trading scheme (EU ETS)

● Revision of the regulation on land use, land use change and forestry (LULUCF)

● Revision of the effort sharing regulation (ESR)

● Amendment to the renewable energy directive (RED)

● Amendment to the energy efficiency directive (EED)

● Revision of the alternative fuels infrastructure directive (AFID)

● Amendment of the regulation setting CO2 emission standards for cars and vans

● Revision of the energy taxation directive

New legislative proposals:

● New EU forest strategy

● A carbon border adjustment mechanism (CBAM)

● A Climate Action Social Facility

● ReFuelEU Aviation – on sustainable aviation fuels

● FuelEU Maritime – on greening Europe’s maritime space

The Commission claims that this package will modernize the economy, stimulate innovation and provide a competitive advantage over other economies. But when politicians (especially EU politicians!) talk about innovation and competitiveness, alarm bells go off in my head.

A European planned economy and a display of lost faith in the free market

All aspects of our economy will be affected by this proposal. The European Commission is embarking on a risky venture in which it not only says ‘what’ should be done, but also ‘how’ it should be done. The government seizes the entrepreneur’s seat and consumers’ hands are guided with respect to their consumption behaviour. Fit-for-55 is an outright planned economy. Progress happens when creative entrepreneurs have the space to turn ideas into reality. Regulation follows innovation, not the other way around. That should be the guiding principle. What the package makes clear is that the European Commission has definitively lost its faith in the free market.

What does this mean for the climate?

The EU itself estimates that this increased ambition from 40% to 55% reduction of greenhouse gases compared to 1990 will cost 1,300 billion euros. However, according to the more realistic estimate of Bjørn Lomborg, the costs will amount to 4 to 5 thousand billion euros. If all EU targets are met, the final result will be an immeasurably small temperature reduction of just 0.04°C. Environment, nature and landscape will suffer major damage and there will be no sign of a temperature reduction.

The Commission’s climate plans are insanely expensive, will take away many of our freedoms and have next to no effect on the climate. Our economy is being put at risk with production costs and consumer prices rising sharply. If this new ‘green economy’ really is the revenue model the Commission believes it to be, we would not need all this legislation. There is a real danger that the competitive position of the countries within the EU will be damaged compared to China, the United States and also emerging economies such as India.

Nuclear power is the only option

Does that mean we should do nothing then? No, certainly not, we must continue what we were doing, which is investing responsibly in an even better future. Politicians may determine the real goals, but in a technologically neutral way. The execution should be left to the market. After all, every investment must be able to be recouped properly and subsidies should never become a permanent instrument. This applies to both energy generation and investments in insulation.

The proposed solutions must contribute to a better future, but the Commission continues to insist on biomass as a large component on the path to carbon neutrality. Complete forests go into the oven, which is at odds with the set goals. Trees absorb CO2 and are important for biodiversity. Combustion for energy generation also releases more CO2 and air pollution than gas. Wind turbines and solar meadows are not efficient, and generating energy in this way comes at the expense of nature, landscape and public health.

In fact, investing in nuclear energy is currently the only solution to phase out fossil fuels in the long term. Nuclear energy is reliable, has a high energy density and is therefore efficient, so that nature and landscape are spared. It also emits no air pollution at all and, contrary to what activists say, the waste is very manageable. France has proven this for decades.

But the Commission, with all its ambitious plans, has not yet included this form of energy generation in its taxonomy plans. As a result, there is no economic level playing field with respect to solar, wind energy and biomass.

Recently, two EU scientific councils published their conclusions on nuclear energy. In general, the reports confirm the previous conclusions of the Commission’s Joint Research Center (JRC) that nuclear energy is an important tool in phasing out fossil fuels and does not cause serious damage to the environment. This means it meets an important condition for being included in the taxonomy. Nuclear energy is also part of the solution in the IPCC scenarios, and NASA previously calculated that current nuclear energy has saved millions of lives because it has prevented air pollution.

Conclusion

In summary, all major success factors of our Western society are currently under pressure because of these Fit-for-55 plans. Free market forces are changing into a planned economy and energy generation is becoming less efficient and therefore more expensive for companies and consumers.

But the greatest danger lies in the threat to democracy. With this package of measures, citizens will no longer have any say in what our society should look like for the next 30 years. That has already been determined in the Berlaymont building. And that is eerily similar to the situation that the people of the former Soviet Union left behind 30 years ago.

Robert Roos worked for ten years as an employee in engineering and construction companies on big projects in the oil and gas industry and also in the infrastructure industry. Now as a Member of European Parliament, he sits on the Committee on Industry, Research and Energy. Roos is a Honorary Distinguished Fellow at the Gold Institute for International Strategy.

Time to examine Ursula von der Leyen’s performance

(This article first appeared in Brussels Morning: https://brusselsmorning.com/2021/06/14/time-to-examine-ursula-von-der-leyens-performance/)

Brussels (Brussels Morning) ‘Sofagate’ now seems a distant memory. A few weeks later, however, now that the dust has settled, it is very important to reflect long and hard on the issues raised and on the many lessons to be learned in parliament from this diplomatic spat.

Ms von der Leyen indicated that, during her visit to Ankara, she had felt ‘hurt’ and ‘abandoned’ and accused Turkish President Erdoğan of subjecting her to sexist treatment by failing to provide a chair for her as he had for Charles Michel.

I have to admit that, when I rose to speak during the European Parliament debate on this matter, I did not actually concern myself with the reasons for which no chair had been provided for the President of the Commission, or why her staff had failed to anticipate such a situation. I have to say that the obsession with such an issue appeared inappropriate, to say the least, at a time when our citizens were in the throes of the COVID-19 crisis that has been driving so many small businesses to the edge of bankruptcy and creating widespread mental anguish, especially among the young. I did, however, take advantage of her presence to raise the question of her failure to ensure the purchase of vaccines, as a result of which the COVID pandemic has lasted far longer in the EU than in the United Kingdom, Israel or the United States.

To my astonishment, I found myself practically alone, since my fellow MEPs were too busy falling over themselves to excoriate President Michel and President Erdoğan for their treatment of the Commission President in Turkey. They failed to utter a single word about her mistakes in handling the COVID crisis or to take advantage of this ideal opportunity to address the vaccine purchase fiasco while she was actually in the room. Instead, Parliament simply handed her a free pass. She left the Chamber as she entered it, unbloodied and unbowed. ‘Mission accomplished’, she must have thought to herself. Turkish musical chairs had carried the day and obsession with EU prestige had outweighed any concerns about the well-being of millions of European citizens. The failures of Ms von der Leyen were matched by the failure of many of my colleagues to rise to the occasion that day.

It speaks volumes that she has presented herself as a victim at a time when so many EU citizens are beset by the fallout from the COVID-19 crisis. Only weak leaders have recourse to such tactics.

Frankly, the reasons for which Ms von der Leyen was appointed to the top post in the EU executive have always been something of a mystery to me. There is no doubt that Germany, was happy enough to be rid of her, in view of her record as German Defence Minister and the shambles she left behind her in the Bundeswehr. Firstly, it found itself short of the necessary manpower and equipment to perform its tasks properly. Secondly, her term of office was dogged by constant issues of probity, culminating in a bill presented to the German taxpayer for repairs to the ‘Gorch Fock’ German Navy tall ship, the original estimate of just EUR 10 million having swelled to EUR 135 million. Only in politics is such failure rewarded by promotion to a top job.

On 31 August 2020, she announced the Commission’s intention of launching a vaccine procurement programme. That was her chance to show that a European approach to complex issues has only advantages. As things turned out, however, we now find ourselves shouldering the consequences of failure to roll out a rapid European vaccination campaign. What is more, the buck does not stop with Ms von der Leyen. It is the pharmaceutical companies that are taking the blame. Playing the Sofagate victim card was therefore just one more example of her distorted view of what leadership actually entails.

My fellow members are also to blame for letting slip the opportunity that presented itself on 26 April to call her to account for the vaccine chaos. I am frankly disappointed in them. I could not care less about the reasons for which no chair was provided for Ms von der Leyen and am not losing a single night’s sleep about the impact this is having on the EU’s international prestige. I just hope that her attitude since the incident in question will have opened a few more eyes to the fact that she is the wrong woman in the wrong place. If so, at least the Sofagate affair will have served some purpose after all.