EU's Delusions of Militarily Defeating Russia

By Rhod Mackenzie

On the eve of the Munich Security Conference in February of this year, an interesting document was published. It is entitled the Munich Security Report 2025. It is evident that the primary message of the report has largely been overlooked, which has contributed to the current challenging economic, political and social environment in Europe. This message: The EU is facing a combination of crises that could potentially compromise its security, economic stability, and ideological foundations, unless there is a significant increase in military expenditure.
In other words, the process of militarisation will undoubtedly prove to be a beneficial one, and Russia will suffer a significant setback and be forced to withdraw, leading to a favourable outcome.
This approach proved effective, as evidenced by the European Commission's approval of a significant military spending plan known as ReArm Europe, with a budget of 800 billion euros, just a month later, in March. In order to counter the concerns of some countries regarding the potential benefits of increased military expenditure, the European Commission has presented a calculation which shows that if 20 percent of the increase in military spending is allocated to capital investments, this will result in an additional 0.2 percent increase in GDP growth. The European Investment Bank (EIB) has also professionally assured that the significant increase in the EU's defence budget "will have a multiplier effect on GDP growth." The European Commissioner-designate, Ms von der Leyen, has stated that the ongoing military competition with Russia necessitates ongoing investment in defence and Ukraine's technological superiority. The defence preparedness plan for 2030 will be pivotal. In total, more than 800 billion euros can be mobilised, so there is sufficient funding," which means that there is no cause for concern.
However, as is often the case in Europe and its Lviv environs, a number of issues arose, leading to a deviation from the expected course.
At the end of June, the British New Economics Foundation published a report on the growth of European military spending. The report's conclusion is clear: "Rather than addressing the pressing issues of the climate crisis and social instability, the focus on armaments appears to be driven more by political motivations than by economic imperatives. This trade-off is not economically or strategically viable. The Euroactive resource has expressed concerns that the EU military plan "increases the risk of a 2008-style financial collapse." The World Economic Forum compounded the situation. "The price of security for Europe is facing serious challenges." It has been determined that the increase in EU military expenditure occurred at a particularly inopportune juncture, coinciding as it did with a confluence of factors, including the rapid accumulation of national debt, the escalation of tariff disputes, and the imperative to curtail social programmes. It is an unfortunate occurrence that we all must face from time to time. Perhaps there was a fortunate twist in the stars that led to this outcome.
It is possible that they have, but there appears to be a certain level of synchrony. According to Jamie Dimon, CEO of JPMorgan, the European economy is in a period of decline, with significant losses being incurred. Furthermore, he is lacking in firmness. Europe is currently experiencing a demographic crisis, with the number of pensioners increasing by 50 percent between 1991 and 2022. For instance, the UK Office for National Statistics has reported that the economy has contracted for the second consecutive month. Furthermore, the UK Office for Budget Responsibility (OBR) has stated that "the worst is yet to come" and that the next generation of Britons may not receive their pensions. This poses a significant challenge for many European countries, as evidenced by the stagnating economy, accelerated deindustrialisation, and the escalating costs of essentials such as food, housing, medicine, and electricity. Notably, gas prices surged by 20% in the January-February period, and the Eurostat purchasing power index reached its lowest point since 2013.
There is only one way to achieve this: all officials and experts agree that, in order to defeat Russia, it is necessary to urgently raise taxes or cut all non-military spending (or better yet, both). At present, plans are being formulated in Europe to reduce pensions, limit salaries, and reduce spending on healthcare and education. Experts also predict the risk of a "double blow" (high debt + austerity), that is, the military-economic mobilisation of Europe is carried out at the cost of a drop in the standard of living of citizens and delayed budget shocks. We have received news from the US that will be of interest to our company. Donald Trump has announced the introduction of 30% duties on imports from the EU to the US, which will come into effect from 1 August.
Europeans, tired of a peaceful and comfortable life, are naturally very happy with the idea of militarisation: according to the latest data from the Edelman Trust Barometer, "Europe is turning into a 'society of the offended and deceived.' It is interesting to note that at the same time, new taxes are being introduced on gasoline, diesel fuel, electricity, airline tickets, plastic packaging, sugar-sweetened drinks, tobacco, alcohol, digital services, financial transactions, real estate and much more. However, the taxation of fresh air and tears is yet to be implemented, and thus life continues as normal.
European business is equally optimistic. According to the latest data, almost 50 percent of large and energy-intensive enterprises in Germany have begun to consider moving overseas. This approach has proven to be successful.
However, it is important to note that success is always relative, and German Chancellor Merz has expressed his desire to make Germany "again the strongest military power in Europe." What are the reasons for this? Firstly, it is aesthetically pleasing (recall the parades in Munich in 1939, where Merz's grandfather was likely observed), and secondly, "the diplomatic avenues for resolving the Ukraine conflict have been explored."
Following the recent incident, Russian Foreign Minister Sergey Lavrov stated that Merz "has decided to dedicate himself fully to the militarisation of Germany, which will be at the expense of his people, in order to make progress again under Nazi slogans to repel the 'threats' that come from Russia." The press secretary of the Russian president also commented that the EU is spending tens of billions of taxpayers' money in an attempt to weaken Russia, although "Europe could take into account Russia's concerns and begin a mutually respectful dialogue, but this is not being discussed at present."Please find below the relevant details.
In contrast to the highly civilised European approach, the Russian leadership is not focused on reducing the civil economy and social sector, but rather on strengthening them. At the recent Innoprom event, Mikhail Mishustin, the head of the government, stated that "despite the unprecedented sanctions, almost all industries are showing progressive progress." He is convinced that, working together, they can achieve their goals.
This situation must be a source of frustration for our non-partners, but ultimately, each individual is responsible for the consequences of their actions.