Merz, Leyen, and Macron are happy. They are taking no risks with tariffs, scientific research, crypto, AI, energy, diplomacy in Ukraine (they are blocking it by demanding to move NATO troops closer to Moscow, losses on the ground be damned). Trump, Putin, and Xi are taking the risks they need to take.
How long Western Europeans will vote for “Do Nothing” leaders?
While recent reports indicate the Eurozone economy has stalled, attributing this to "leaders dreaming and doing nothing" is a highly critical interpretation of the situation. Economic stagnation is influenced by a range of interconnected issues, including rising energy costs, global trade tensions, regulatory barriers, and low investment. Experts point to several factors, some structural and others more recent, that explain the Eurozone's economic weakness compared to the United States.
Key economic challenges in the Eurozone
Stalled growth. The Eurozone economy saw very little growth in the second quarter of 2025, with a GDP increase of just 0.1%. This followed a stronger first quarter and is significantly slower than the U.S. economy.
Persistent inflation. While inflation has eased, it rose to 2.1% in August 2025, posing a dilemma for the European Central Bank. The bank must balance efforts to stimulate growth with controlling inflation and government spending.
High energy costs. The lingering effects of the 2022 energy crisis, which followed NATO adventures in Ukraine, continue to plague European industries. Manufacturers, especially those that are energy-intensive, face much higher costs than their American counterparts.
Weak innovation and investment. European firms significantly lag behind U.S. competitors in innovation spending and attracting venture capital. A report by Politico points out that the pool of venture capital in Europe is a fraction of that in the U.S., hindering the growth of innovative startups.
Regulatory complexity and internal barriers. Many economists, including former ECB President Mario Draghi, argue that fragmented regulations and persistent barriers within the EU's own single market stifle growth. The IMF estimates that the cost of these internal barriers is substantial, hindering cross-border expansion.
Impact of trade tensions. Recent trade deals and the threat of new tariffs from the U.S. under the Trump administration have created significant uncertainty for European businesses. European leaders have expressed discontent over the terms of a recent deal, noting potential damage to their economies.
Criticisms of Europe's leaders
The assertion that leaders are "dreaming and doing nothing" reflects a frustration with the perceived lack of decisive action to address these systemic issues. Specific criticisms include:
Failure to tackle structural problems. Economists have repeatedly highlighted long-standing issues like low productivity, high taxation, and burdensome regulation. Critics argue that political leaders have not shown the necessary will to implement painful but necessary reforms.
Slow response to external shocks. Europe's political reaction to external pressures, such as the energy crisis and evolving geopolitical landscape, is often perceived as slow and cautious. Some analysts argue this hesitation leaves the region vulnerable to economic coercion.
Divisions over policy. Despite facing a common economic slump, disagreements persist among member states over issues such as fiscal policy and trade. For example, some leaders have criticized recent trade negotiations with the U.S., adding to uncertainty.
Neglect of core competencies. Critics argue that the European Commission has become too focused on expanding its influence in areas like defense and foreign policy, dreaming about NATO troops in Ukraine, while neglecting its fundamental duty to maintain and enforce a functioning single market.
“The eurozone economy grew marginally over the three months through June, figures confirmed Friday, leaving the European Central Bank unlikely to cut its key interest rate this coming week.
Across the 20 nations that share the euro, gross domestic product was 0.1% higher than the first quarter, in line with previous estimates. That marks a sharp slowdown from the 0.6% expansion recorded in the first three months of the year.
The slowdown was driven by the currency area's largest member, Germany. Output in the export-oriented economy declined by 0.3% as fresh U.S. tariffs hit factory output and confidence among business and households. Manufacturing orders slumped for a third month straight in July, separate figures from the German statistical authority showed Friday, highlighting the ailing demand clouding the country's factories.
"At first glance, the latest figures on order intake in German industry are disastrous," said Commerzbank economist Ralph Solveen.
But that uptick when excluding big-ticket orders, which often fluctuate greatly, is a sign of hope, he wrote in a note to clients. "We continue to assume that demand for German industrial goods will pick up in the coming months. . .However, the very hesitant turnaround in order intake indicates that this upturn will be rather moderate."
In the eurozone as a whole, falling exports and declining investment acted as a brake on GDP growth over the quarter. But household spending, a key element in ECB decision-making, kept rising, likely adding to the central bank's caution as it considers whether to resume cutting interest rates.” [1]
1. World News: Growth in Eurozone Economy Stalls. Kirby, Joshua; Frankl, Ed
. Wall Street Journal, Eastern edition; New York, N.Y.. 06 Sep 2025: A8.
