Mar. 10, 2025 |
The European question. As the U.S. pulls back its support for Ukraine, Europe is clearly saying that it wants to pick up the slack. But can Europe pull it off?
European countries have increased defense spending by about 30 percent since 2021—but as John R. Deni says here in The Signal, they’re now running into serious budget problems that could thwart their desire to send more aid to Ukraine.
German law prevents the government from running a deficit larger than 0.35 percent of GDP, though the incoming cabinet has said it wants to revisit the limit. The U.K. and France—the next two largest economies in Europe—are already facing severe fiscal shortfalls; the new British budget cuts government spending, while France just passed a budget with a deficit amounting to 5.4 percent of GDP, violating the EU limit of 3 percent—for the sixth year in a row.
—Michael Bluhm
From this week’s member’s despatch …
