Editor’s note: For the past week our friends Sean Ring and Byron King over at The Rude Awakening have been breaking down implications of President Trump’s second term. In the article below, Sean explains how Trump 2.0 looks from a European perspective. With his boots on the ground in Italy, his perspective is definitely worth paying attention to.
Energy: Cheap and Secure
Germany, America’s chief poodle on The Continent, jumped all in to this Ukrainian thing because if they didn’t, they’d have been accused of reverting to National Socialism. That’s harsh but true, and Ze Germans are well-trained vassals by now.
Source: X.com
However, this unconditional backing has destroyed the German economy. That’s not hyperbole; it’s the truth. I’m not sure General Macgregor is correct in his above tweet, but the Germans must be thinking about alternatives by now. I’ll spare you the details, but here’s all you need to know about the deindustrialization of Germany:
Source: The Wall Street Journal
In aid of this, here are some things the US can do to help out its allies, energy-wise:
The U.S. has become a top liquefied natural gas (LNG) exporter. Trump could expand this capacity, providing Europe with a cheaper alternative to Russian gas. Incentives for private-sector investment in LNG infrastructure—both in the U.S. and Europe—would bolster this effort.
Trump’s administration should push for joint investments in nuclear energy technology. This would aid Europe’s transition to a genuinely sustainable energy infrastructure, reducing dependency on volatile global markets. But, the Germans would have to remove Green lunatics from their government.
Finally, form a U.S.-European energy council. The Trump administration could facilitate collaboration on supply chain security and create strategic reserves to shield allies from market shocks.
Failing all that, let the Germans buy cheap Russian pipelined gas without giving them guff over it.
It’s Trump Week: three more days until the inauguration of the once and future president.
Each day this week, the Rude dives into what to expect from Donald Trump’s second term. This has YUGE implications for America and the world, certainly the economy and our investments.
On Monday, we discussed looming executive orders from Trump’s inbound administration. On Tuesday, we discussed tariffs. In Wednesday’s Rude, we discussed the possibility of a Biden recession, which would be handed off to Trump.
Today, let’s examine Europe’s future. The economy is tough here, and the euro is fading into toilet paper-like irrelevance.
And post-Ukraine, the entire NATO alliance is up for grabs.
What can Trump do? And what should you do? Read on…
With Allies Like America, Who Needs Enemies?
Let’s address a few things Americans never think about that are perpetually on the minds of their allies.
The first is America’s “exorbitant privilege” of having the USD as the world’s reserve currency. While Americans complain that Europeans never pay their “fair share” for NATO or enough for America’s Big Pharma drugs, it’s worth understanding that printing every $100 bill costs the U.S. Treasury only 5.4 cents. Yet, the U.S. demands $100 worth of real goods for this paper. This economic system has been a staggering ripoff from the start.
Second, if you believe five drunken Ukrainians came up with a plan to blow up Nordstream and then executed that plan, I’ve got a bridge over the East River to sell you. Whether America used proxies or not, one of its three-letter agencies either came up with the idea, supported it, or both. So, America blew up Germany’s cheap energy source and then demanded it pay full market price for American LNG… which is 4x as expensive! And then, in an act of industrial thievery, the USG happily allowed German companies to up sticks and move to America because energy is cheaper there.
Third, Donald Trump is coming in and saying he’s going to pull out of NATO and slap tariffs on the EU. Is that how you’re supposed to treat your allies? I’m all for NATO disbanding, as it should’ve been over 30 years ago. But equally, I’m sure the U.S. military-industrial complex will hate it, as European allies have to buy U.S. equipment to comply with NATO standards. As for tariffs, sure, you can do that, but expect the EU to retaliate. I wonder how he will close the trade deficit when no trading is happening.
A small note on the UK, which is no longer in the EU: I hope Trump punishes Starmer’s government for interfering in U.S. elections. The Brits need to be put back in their box.
Halford Mackinder’s map (Heartland Theory) makes it easy to see Europe’s geography… and options.
As Philosopher-Truck Driver John Ring is wont to tell me, “You’ll catch more flies with honey than vinegar.” In that vein, here are a few ideas for Donald Trump to help his European allies out so he can stop making Russia, China, and BRICS look like attractive alternatives.
Manufacturing: “Allies First?”
European manufacturing has struggled due to supply chain disruptions, energy price volatility, and Asian competitive pressures. Trump’s “America First” ethos ought to evolve into a broader “Allies First” strategy.
From Capital Economics on how Trump-style U.S. protectionism will hurt Europe:
“Germany and Italy will be the hardest hit of the major economies. Their exposure to the US is more than twice that of France or Spain. Germany is also most at risk from additional tariffs on vehicles. And its large bilateral surplus with the US may make it a target for Trump.”
Trump should support policies encouraging European companies to reshore critical manufacturing and offer joint ventures with U.S. firms to leverage shared technological and capital resources.
Creating a robust transatlantic supply chain network would counteract overdependence on China. Sectors like semiconductors, pharmaceuticals, and electric vehicle components stand to benefit.
The Donald can encourage investment in high-tech manufacturing across Europe through tax breaks, deregulation, and not levying tariffs, especially in areas that suffered industrial decline.
Technology: A Secure Cyberspace
Europe faces a technology gap, particularly in artificial intelligence, green tech, and cybersecurity. The U.S. can play a pivotal role in helping allies maintain competitive edges.
Trump’s administration should establish cross-border research programs to accelerate innovation in emerging technologies. This would combine Europe’s regulatory expertise (which it excels at) with the U.S. entrepreneurial spirit.
By partnering with European governments and private firms, the U.S. can roll out more 5G and explore the potential of 6G networks. Then, European allies will remain at the forefront of connectivity without resorting to Chinese technology.
Europe’s cybersecurity vulnerabilities threaten its industries and transatlantic security. DJT should lead a NATO-aligned initiative to bolster cyber defenses, train joint task forces, and enhance information-sharing frameworks.
If the Trump administration does nothing, Europe’s head will turn in other directions.
Wrap Up
The Donald’s love for making deals can revitalize U.S.-Europe relations. The US can support its European allies by addressing energy diversification, manufacturing resilience, and technological leadership.
The challenge, of course, is getting it done. If Trump wants to keep Europe in his orbit, he must prioritize long-term strategic alignment. If he succeeds, the transatlantic alliance will emerge more assertive, competitive, and prepared for global challenges.
https://dailyreckoning.com/what-will-trump-do-for-europe/
