Sophia Besch, Dan Baer, and Rosa Balfour tackle the key questions about the future of Europe.
Between high-level reports, bold statements, and internal negotiation, Europe struggles to outline a cohesive geostrategic vision for its place in the world.
Sophia Besch, Dan Baer, and Rosa Balfour explore why the EU often fails to establish long-term solutions to the challenges it faces, and explain how Europe can overcome its political and institutional paralysis.
Rosa Balfour, Stefan Lehne, and Elena Ventura, September 22, 2025, “The European Radical Right in the Age of Trump 2.0,” Carnegie Europe.
Sophia Besch, June 26, 2025, “The Price of Protection,” Emissary, Carnegie Endowment for International Peace.
Dan Baer, May 13, 2025, “Trump’s Brain Drain Will Be Europe’s Gain,” Foreign Policy.
Rosa Balfour, April 30, 2025, “Europe Tried to Trump-Proof Itself. Now It’s Crafting a Plan B,” Emissary, Carnegie Endowment for International Peace.
Rosa Balfour, March 25, 2025, “The Case for Europe,” Strategic Europe, Carnegie Europe.
Sophia Besch and Erik Brown, December 16, 2024, “Securing Europe’s Subsea Data Cables,” Carnegie Endowment for International Peace.
Dan Baer and Sophia Besch, December 12, 2024, “NATO’s Northeast Countries Have a Template for Europe’s New Security Reality,” Emissary, Carnegie Endowment for International Peace.”
Sophia Besch
Hello and welcome back to Europe Inside Out. My name is Sophia Besch and I'm a senior fellow in the Europe Program at the Carnegie Endowment for International Peace here in Washington, D.C. and I'll be your host for this episode.
Today we're looking at how Europe should navigate an increasingly contested global landscape. The challenges are well known, from competitiveness pressures to Russia's war against Ukraine to Trump 2.0. But Europeans not only disagree on prescriptions, they disagree on the trade offs required, on the strategic priorities to set, and on the strategies to pursue. Too often the debates that are required make us uncomfortable because they challenge long standing assumptions m and beliefs we've held about ourselves. And therefore, too often, we avoid having those arguments at all. So, to tackle these questions head on, Carnegie Europe is launching a new project in 2026 called Europe Head to Head, where leading experts from across the continent will debate their perspectives and we will put confrontation up front in the hopes of finding a way forward for the European project. That's why I'm pleased that Rosa Balfour, Director of Carnegie Europe, and Dan Baer, Senior Vice President for Policy Research at the Konige dumped in Washington and also Director of the Europe program here in D.C. are joining me today on the podcast to unpack and sort of foreshadow this exciting new project we got planned. Dan, Rosa, welcome.
Rosa Balfour
Hi, Sophia
Dan Baer
Thanks for having us.
Sophia Besch
Great, so let's begin with the why here, why now? Dan, Europe has been through crises before, but those crises largely played out within a familiar operating system. U.S. security guarantees, functioning global markets, a largely unpoliticized tech environment. In 2025, it seems that that operating system itself is shifting and energy, defense, technology have all become contested strategic domains simultaneously. So in your way, what specifically makes this the moment where Europe has to interrogate its strategic assumptions?
Dan Baer
Well, I think it's important to click up a level. I think all of us have a sense that the world is going through a series of tectonic shifts. And one of the things that's challenging in a moment like this is that when there's an earthquake happening every day it's hard to focus on what those tectonic shifts are. And while many of us rightly focus on the parts of the old world that we knew that have come under strain or fallen away, it's a really important and valuable mission for people who care about the future to think about what the future might hold and take a step back and look at those tectonic shifts. I think the second thing is that Donald Trump is very good at capturing the headlines. But we have to remember that international politics is not ever reshaped by one person alone. There's always other people, other countries on the other side of those stories. And Jake Sullivan said recently in a podcast that Donald Trump has really developed a strategy for interacting with those who he sees as less powerful than the United States, but he has done less well at coming up with a strategy for dealing with those who he sees as strategic competitors or equals. And so he's much less clear on his strategy for dealing, for example, with Putin or Xi. Well, that's an important point about America's foreign policy. It's also an important point for Europe, because Europe suffers the consequences or reaps the benefits of an effective United States relationship with other global players. And so I think this is really an opportunity for us to take a step back and look at what Europe's interests are and how Europe can navigate this new world that we're in and take account of those underlying tectonic shifts that are reshaping the world as we know it.
Sophia Besch
Rosa, if we're staying with this sort of structural logic of taking a step back, I wanted to ask you about internal European tectonic forces that make this a hinge moment for Europe. Can you talk a bit about that?
Rosa Balfour
Yeah, I mean, let me also just, you know, follow up a little bit on what Dan was saying. Looking at it from a European perspective. You know, Europe has been living through close to two decades of continuous crisis. It started in 2008, and it's just been this continuous wave. Some call it the polycrisis. And it's nearly two decades that the sort of dominant mode has been the politics of emergence. Nobody's really stopped to discuss what kind of vision of Europe do our leaders have. What kind of vision for Europe do Europeans have? There is a total absence of debate.
I don't think political leaders, when they meet up for their regular summits, they do not talk about what vision of Europe they have. They do not talk about what kind of reform agenda do they really need to embrace. They just talk about trying to find some consensus, not even at 27, which is the number of members that currently form the European Union, but at 26, because of their own internal divisions. So, the politics of emergency is really about managing the crisis. And it's not about debating what kind of vision for Europe they have. The only people who are talking about a vision for Europe are the Euroskeptics. And there is a political setting a political landscape in Europe that is letting Euroskeptics frame the debate on what Europe should look like. So we have, since 2008, which was the last moment of reform in the European Union, we haven't really had a debate on the future of Europe. And let's also add that actually Europeans would rather like to have it. There is opinion polls show that the interest in Europe is growing. Opinion polls show that despite the politics of emergency, the EU is actually still trusted. And what Europeans are not getting is a debate on what Europe should look like. So I think it's high time to go a little bit beyond the headline, to go beyond the noise of daily politics, to go beyond the politics of emergency and to think a little bit more broadly about what the future looks like.
Sophia Besch
So listening to both of you, I think it's very clear that externally and internally we are in a new era. The question then becomes whether Europe can operate strategically within it. Which brings us to the second theme that you've sort of already alluded to Rosa, which is this theme of paralysis really. Because it's not a lack of diagnosis, right. We've had these big landmark reports from Draghi, from Niinistö, from Letta big structural proposals on European competitiveness, European resilience, the future of the single market, with you know, a ton of suggestions and proposals for how to, how to enact a new vision for Europe. And yet we still have European leaders behaving incrementally. In fact, no one even seriously really debated the proposals in these landmark reports. I would say that we're really seeing the dangers of a sort of benevolent disinterest in vision. European leaders gave these reports the benefit of engaging seriously and critically with them, we would be at least in a substantial debate. Instead we sort of get a “Well all of that would be nice. But over the day to day struggle of managing these crisis, we don't really have time to address the bigger issues, the bigger vision.” So if I put it analytically, the question to me is why is the system not converting strategic insight into strategic action?
Rosa Balfour
Yeah, no, you're totally right. It's actually quite striking how little discussion there has been on the individual reports that have come out which are, you know, even from the point of view of traditional politics, you know, left and right, approaches to the economy. There are issues to be debated and they haven't Been debated, which is…
Sophia Besch
Benevolent disinterest.
Rosa Balfour
Exactly. I think that's very apt. What we have, we have this kind of triangle of despair. We have a hostile world. We have a huge reform agenda that needs to address security and defense because the Americans are not going to be defending Europe any longer. Needs to address Europe's economic vulnerabilities because its growth is not satisfactory and certainly not sufficient to meet the big security and defense requirements. We need to transform the economy so that it can address climate, the climate crisis. So we have a huge agenda that needs to be addressed and that is outlined in several reports. And then the other angle. The other corner of this triangle is the politics.
And the incommensurability between these three points is really quite extraordinary. I don't think we've ever seen a political leadership that is so incapable of addressing these. And you're right. Why is this? You know, and again just to reiterate the point, you know, this is close to two decades of crisis. So why is it that we haven't managed to get to the bottom of it? I think the first point would be this is a general, a challenge and a problem for at the international level. It's not just at the European level. The second issue is that Europe does have a governance problem. The continent at large, the UK has left the European Union. There are countries that are wanting to join the EU. So we have a governance issue that is in perpetual flux. The treaties, the mechanisms, et cetera, are clearly not fit for purposes. I think we have a real problem in the sense that on the European continent there's been this, you know, since the 1950s, this strong drive towards integration and towards delegating authority to Brussels. But this has not been matched by a similar development in terms of what the national debates are about. So we have a real mismatch between national politics and policymaking at the European, at the EU level. There's a disjuncture there, between debates between identities, between accountability mechanisms. And then I think more broadly there's a real crisis of democracy. In the sense that the democratic models that we've been developing since the end of the Second World War have not been capable of reforming themselves to address the simultaneous challenge that some authority is being delegated to the international level or the regional level. And a lot of problems are manifesting themselves very much at the local level. So we have a real problem of governance, which is actually a crisis of democracy. And I think if you add those together, we can find a structure to understand many of the policy challenges that we're facing today.
Sophia Besch
Yeah, that's really fascinating. I mean, I will say that. And Rosa, you and I have talked about this before. I think the capital where you feel the paralysis least is probably Brussels. There are people with big ideas and big visions who pragmatically and proactively are working for a new Europe. And then really the, the angst is in the capitals. And we've long talked about, you know, where is the motor for European political integration? It used to be Paris and Berlin. It's perhaps not those two countries anymore. But how can we empower Brussels to actually enact on some of these ideas? Dan, I want you to comment on what Rosa has says and then maybe also broaden this idea of where the paralysis is coming from to the transatlantic environment and how that may be reinforcing some of the trends that Rosa has been talking about. And if you could maybe also bring in the business ecosystem between Europe and America. And whether that is reinforcing or perhaps opening up a new pathway, ways out of this paralysis.
Dan Baer
Great. I mean, as a, I'm going to oversimplify as, as Americans are want to do. But as an external observer, you know, it seems to me that three things are true. One, Europe, like all other major powers in the world, is at a strategic inflection point where the strategies for the last half century, the last generation, need to be in some cases completely redone, and at a minimum refreshed in order to tackle the world ahead. And two, this is happening at a moment where in Europe's own evolution, power sits really kind of betwixt in between Brussels and capitals. And because power sits betwixt in between, neither Brussels alone nor capitals alone can actually develop the strategy for the way forward. And that presents a fundamental challenge for Europe. And third, the transatlantic relationship, which has been fundamental to Europe's strategic outlook since the Second World War, has been changed. I don't want to overstate it by calling it a divorce, because it's not a divorce, and I have hope for its future, but it has some characteristics of a divorce certainly in the last decade.
And like in a divorce, you not only lose the partner, but you lose the partner at a moment when you're needing to navigate something new and that partner is the person you relied upon to help you navigate hard things. And so Europe is facing a strategic challenge at a moment when it has really had a break with what has been its closest strategic partner and the source of much of its strategic thinking, certainly in the security realm. It's not surprising if you take all of that into account, that there is some level of paralysis. Fom the U.S. side, one of the reasons why I think the United States or a couple reasons why I think the United States is not actually well positioned to help Europe right now come up with that new strategy. First of all, I think in the United States there continues to be an under appreciation of the importance of Europe's future to America's future. It is just not common top of mind thinking in Washington to believe that as Europe goes, so goes America. Despite the fact that if you look at the global context, it is clear that if the United States is going to succeed in the next half century, it is going to need a strong Europe as a partner to manage the world's challenges and to secure prosperity and security for the American people. But that is not something that people would list as a number one, two or three strategic priority for the United States. And second, the United States still doesn't know who to call. And part of that is the betwixt and between issue. I think there's not clarity from Washington on who will be in a position to develop the strategy and as importantly to implement the steps around any strategy that could take it forward. Coming to the end of your question, Sophia, one of the areas that seems to me to be a clear opportunity for a win-win for the United States and Europe in the years ahead is that both the United States and Europe have, on their own, identified the need to build out their defense industrial base, which is a largely commercial, project obviously with national security implications. If both the United States and Europe are committed to spending more and to developing their defense industrial base, there ought to be opportunities for deeper partnership in that realm. There's more money coming into the system on both sides of the Atlantic and there ought to be mutual benefit and shared projects and efficiencies to be gained by working together. And you know, maybe it is the case that instead of kind of looking for the future of that partnership to be at the level of communiques and joint statements that it's actually at the level of joint projects and investments that that will be taken forward and that frankly trust can be rebuilt.
Sophia Besch
I will say is this point is usually, I feel like where podcast discussions on the future of Europe sort of end. This was more insightful than most and we've done, I think you both have done a really great job analyzing the underlying issues and trend lines and structural constraints. But we at Carnegie don't want the conversation to end here. This is exactly sort of what we're frustrated with. And that's exactly why we're launching this new project Europe Head-to-Head to debate not just the structural trends and underlying crises, but instead get into the really hard concrete questions that Europeans are going to have to tackle head on. Because clarity about the vision for Europe only emerges, we think, when you force choices. So in this next part of the podcast, what I wanted to do with the two of you is just preview the six questions that we're going to debate over the course of this project next year in 2026. And I am going to read each of these questions and I'd like each of you to just one or maximum two sentences on why this question matters, what you hope to see in these debates and then hopefully leave our audience wanting more. So question number one, that we will have two speakers fight out in our Europe head to head debates is: “Can Europe ever trust the United States again?” Rosa, why does this matter?
Rosa Balfour
Well, this was, Dan said it's not quite a divorce. I think when we started talking about this we were saying is can Europe divorce the United States. W as, was also one way of putting it, I think. I mean, you know, I do think and you know I was in the United States to see you very recently. I do think the transatlantic relationship is in a little bit of a bind because those who care for it perhaps hopig that the transatlanticists on the other side of the pond will be able to keep up the flame of transatlanticism while the United States goes through its anti transatlanticist administration, shall we say. I think whether Europeans will be able to trust Americans again. I think Europeans really need to learn to trust each other and themselves and that on both counts this has been missing. So regardless of what happens in the United States and regardless of the future of the transatlantic relationship, this trust building in the European continent is absolutely vital. And you know, there are some in Europe who argue that thanks to Donald Trump, this, this will actually happen. I have my doubts about it, but I do think the terms of the debate need to be seriously raised, and that's what we hope to do with our podcast series.
Sophia Besch
Dan, can Europe ever trust America again?
Dan Baer
Yes, but not as much as it once did, which might in the end be a good thing because it means that the way forward is to develop a shared assessment of reality and a shared vision for the future and to build a partnership that's based on that.
Sophia Besch
Much more to say on this. Debate number two will be broadly on enlargement. But the way that we're phrasing is: “Would a smaller EU be stronger than a larger one?” Dan?
Dan Baer
No, and I think the people who ask that question are missing the point. The enlargement question isn't about whether there's a smaller Europe with more Switzerlands on the outside. It's misses the point that to have a smaller Europe is to leave more pieces on the board and more people without the future that Europe promises. And if the United States was the most magnificent political experiment of the 18th century, then Europe was the most spectacular political experiment of the 20th century.
Sophia Besch
Rosa?
Rosa Balfour
I think historically enlargement has served Europe very well, both in terms of economic growth, in terms of geopolitical stability. There are difficulties, but it has served very well.
Sophia Besch
Question number three, and this really goes to the heart of, you know, when we were talking about this project, we said we wanted to raise some of the taboos that people talk about behind closed doors but don't talk about in public. And so question number three is: “Could a fully rearmed Germany destabilize the European equilibrium?” Rosa?
Rosa Balfour
Well, there's Germany and of course we're also looking at a fully-armed Ukraine. So let's not forget there's that. And we know the history of the European Union has been very much tied to containing Germany. So I think the only answer to that is that Europeans make sure that their defence efforts are well integrated and interoperable. So that no single power can become a threat to its neighbors.
Sophia Besch
Dan?
Dan Baer
Yes, I think, fully rearmed Germany could destabilize Europe in important ways, but it need not. And the challenge here is to be good students of history without being prisoners to it.
Sophia Besch
Question number four: “Is the far-right challenge overstated?” Dan?
Dan Baer
No, I don't, no, I don't think it's overstated. I think the far-right challenge is understood with less nuance than it might be. And one of the challenges for those of us who believe in the future of Europe and the future of European democracy is to make the case that nationalism is a bad strategy for prosperity and security, setting aside any moral qualms that we may have with its underpinnings.
Sophia Besch
Rosa?
Rosa Balfour
So I think it is existential, but it's not inevitable. And I think the analysis hasn't quite found the right place for the rise of this phenomenon. But I do think that historically democratic regimes have been very bad at spotting their own demise. So we need to, we need to pay attention to this.
Sophia Besch
This leads beautiful into, you know, a question on empires and their demise. Because our next question is on the Global South. The way that we have framed this is whether the Global South would want Europe out. Rosa.
Rosa Balfour
I think some Global South actors are riding this nationalist wave and challenging Europe in ways that are not dissimilar from the nationalist right in Europe, paradoxically. But I don't think it's in the interest of the Global South to have Europe out. I think it's in the interests of the Global South to persuade Europeans that reform is needed in order to manage global commons.
Sophia Besch
And Dan?
Dan Baer
No, the Global South doesn't want Europe out. The Global South, like all international actors, wants options. And the challenge for Europe is to come up with good options to offer the Global South.
Sophia Besch
Okay, that brings us to our last question, which is a sort of bonus question. Listeners will have noticed that we could have called this five questions for Europe, which arguably would have been more elegant but less analytically honest. Because there is the sixth question, that is a bit broader, where we really want to force ourselves to build on the debates that we will have had at this point. And that question is: “If you could redesign Europe from scratch, what would you build?” You don't have to redesign Europe from scratch now, but Rosa, what would you want to get out of that conversation?
Rosa Balfour
Well, you know, Europe, the integration process started from the real economy and then moved out towards foreign policy. I'd be interested in thinking about Europe that starts from foreign policy and then moves back in so that you make a Europe that is fit for the world.
Sophia Besch
Excellent. Dan.
Dan Baer
I like Rosa's answer to that. A question like this requires some humility. So I want to say from the outset that Europe developed the way it did because of historical and political reasons at the time. So I don't. I don't second guess the development. So I want to start with humility. But I guess I would wish for something that approached more a European federalism where there was a clear set of prerogatives that Europe was able to act on at the European level that made it more of a significant and unified global actor.
Sophia Besch
I think that was a great preview to sort of whet everyone's appetite for these debates that will come over the next few months. We will also publish short position papers ahead of the conversation, and the confrontation will be available here in the podcast feed. Every debate in this series will follow that model. And then at the end, we will produce a compilation, not just mapping the choices, but offering answers on what Europe should do next. I'm really looking forward to this, I think we will bring in some great people and have some very, very interesting, honest conversations with them. I want to end with one last question to both of you, Rosa and Dan, and thank you so much for. For doing this today. That last question is perhaps wishful thinking, but if you could force Europeans to make one strategic choice, just one, what would it be? Dan?
Dan Baer
The frame of one strategic choice is difficult. But I think if I could focus them on one of the, say, three reports that we highlighted in the beginning of the conversation it would be the Draghi report, which has gotten a lot of play. But I think there is no way for Europe to have the strong future strategically, from a security standpoint and economically, that it must have without figuring out its way back to being a source of innovation in the global economy.
Sophia Besch
Excellent. And Rosa?
Rosa Balfour
Yeah, I think even I agree with the framing. I also think that, you know, in a world of might, the EU needs to double down on its strengths. And I would enlarge. It doesn't. It's not just the EU, it can be much broader than that. I would say capital markets union. Get the money flowing, and then everything else will follow.
Sophia Besch
Love that ending. Any conversation that ends with the capital markets union, in my mind, is a good conversation. So, Rosa, Dan, thank you so, so much for doing this.
And thank you, everyone, for joining this month's episode of Europe Inside Out. If you're interested in following the Europe Head to Head project, be sure to check out Carnegie Europe's website, where all the work on the future of Europe is hosted. And subscribe to Europe Inside out, so you don't miss out on future discussions.