People often wonder how cash-strapped Russia could so easily intimidate Europe. The answer is willpower. Russia is ruled by a ravenous carnivore. Europe is a pasture of well-fed herbivores. When it comes to decision-making edge, Vladimir Putin’s single-mindedness outweighs the combined wealth of the EU plus Britain and Norway. They add up to roughly 10 times Russia’s GDP.
For the most part this speaks well of Europe. Democracies do not generally decide to embark on bloody wars of choice, such as Putin’s invasion of Ukraine. By a factor of 27, say, democratic clubs are even less likely than a single democracy to reach aggressive consensus. The EU is literally the outgrowth of a project to abolish war. If the rest of the world were like Brussels, Europe could carry on masticating. More realistically, were the United States still a guard dog willingly patrolling Europe’s perimeters, continued grazing might still be excused (though never advised). But Donald Trump, in his way, is as much of a wolf as Putin. Europe has run out of excuses to pretend otherwise.
The end of self-deception is staring Europe in the face. I don’t claim to know the legal ins and outs of unlocking the roughly €210bn worth of frozen Russian central bank reserves to fund Ukraine. That is why I have asked my colleague, Martin Sandbu, to respond to this week’s note. Martin has been paying close attention.
I do know that where there’s a will there is a way. Unlocking the money to fund Ukraine for the next two or three years would change the weather. Between them, Trump and Putin last month cooked up a plan to settle Ukraine’s fate without consulting Kyiv or anyone else. I was at a Trilateral Commission conference in Vienna when that infamous 28-point document was published. I had been invited to conduct a fireside chat with Mark Rutte, Nato’s secretary-general. That Stephen Witkoff-negotiated (stenographed?) bombshell forced Rutte to cancel. I had been planning to ask him whether flattering Trump had run its course (Rutte attracted a lot of derision last summer when he referred to Trump as “Daddy”). Perhaps that would have been unfair. Rutte might plausibly have argued that his Trump ego massage brought Ukraine at least a few weeks reprieve.
In any case, Carl Bildt, Sweden’s former prime minister, took Rutte’s place. The normally understated Bildt came on stage brandishing that day’s copy of the Frankfurter Allgemeine Zeitung, which had a front-page editorial headlined: “Der Trump-Putin-Pakt” — a clear reference to the second world war Nazi-Soviet pact.
Bildt’s gesture prompted me to make the somewhat overwrought comparison between today’s bleak horizon and Winston Churchill in 1940. One of the steps that gave Franklin Roosevelt confidence Britain would fight on was Churchill’s order to sink the French fleet at Mers-el-Kébir in June 1940. At that point American politics was tilted against lending Britain 50 ageing destroyers. Churchill’s brutal pragmatism, which claimed 1,297 French lives but ensured their vessels did not fall into German hands, helped tip the mood in Washington. Lend-Lease was passed a few months later. In my view Europe’s decision today to put Russian assets in Ukraine to work against Russia would send a similarly unequivocal message. The herbivore would have awoken. Both Moscow and Washington would need to recalculate.
Among Witkoff’s 28 points was the stipulation that America would mediate security talks between Russia and Nato. Perhaps it escaped Witkoff’s notice that this meant America would no longer be speaking for Nato. Or perhaps he well understood its meaning. Whether it sprang from ignorance or perfidy, he revealed Washington’s hand. Another of the document’s points specified that “$100bn in frozen Russian assets will be invested in US-led efforts to rebuild and invest in Ukraine; the US will receive 50 per cent of the profits from this venture”. As I say, Trump is also a hungry wolf.
Later this month, the EU will decide on a revised Brussels plan to make use of those Russian assets. I hope the new workarounds do enough to indemnify Belgium and sideline Hungary and Slovakia. Should Europe fail the test it will have earned the derision that is now so frequently heaped on it by Americans (not just Maga ones).
I am with those who would prefer to risk a flood of creditor lawsuits than tolerate Europe’s continued surrender of agency. Martin, is Europe prepared to do what it takes? Or is it a case of once a herbivore always a herbivore?
Recommended reading
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My column this week asks whether Trump is capable of pulling off regime change in Venezuela without putting US boots on the ground. More to the point, would it be sane to go to war with Pete Hegseth running the Pentagon? For some lighter relief, I also gave a tour of Washington’s Maga dining scene in last weekend’s FT. The piece was part of the FT’s excellent Globetrotter guide to DC.
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Talking of Hegseth, I urge Swampians, particularly conservative ones, to read George Will’s latest Washington Post column — “A sickening moral slum of an administration”. Will is hands down the longest-running conservative commentator in Washington. His outrage is something to behold. When Will writes that “a nation incapable of shame is dangerous”, we should take note.
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My colleagues John Thornhill and Richard Waters are both essential reads on the AI revolution. Do read John’s column this week on how “The US may be running the wrong AI race” (and thus losing to China), and Richard on “OpenAI’s Code Red moment”, which sounds an equally ominous note for Sam Altman.
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Among the many tributes to Tom Stoppard, one of my favourite playwrights, I would highlight Tina Brown’s. As one of Stoppard’s characters says, and Brown quotes, “Life’s bounty is in its flow, later is too late.”
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Finally, I was cock-a-hoop to see Zbig, my biography of Zbigniew Brzezinski, appear on many best books of 2025 lists, including The Economist, The Washington Post and Foreign Affairs. The latter said that “in writing this gem of a book, Luce has rendered a genuine service to history”.
Martin Sandbu replies
You cite the right facts and ask the right questions. I would start the answer by saying things are not as bad as you think, but nowhere near the “what it takes” that you rightly call for. Recall, for example, that this strange multi-layered sovereignty construction of 27 nation-states have managed to pass — unanimously! — 19 sanctions packages and counting. These are causing real damage to Russia, despite the self-serving loopholes and slack enforcement. And the general determination to support Ukraine — and more than that, a real identification of the European project with Ukraine’s survival — remain strong. I wrote about my fear of “Ukraine fatigue” in the early summer of 2022. Three and a half years on, things are better than I feared.
Which brings us to the “reparations loan”. The EU gets the urgency of financing Ukraine, and soon; Kyiv’s money could run out in the first half of next year. German Chancellor Friedrich Merz rightly argued in the FT in September that it’s important to give a big amount — one that gives Kyiv the freedom to plan and fight for several years. So why does it all seem so contested?
Let’s be clear about two things. First, EU countries would rather not put (more of) the cost of helping Ukraine on their own balance sheet. But it would be eminently affordable for them to do so. EU countries’ entire contribution to Ukraine since 2022 is less than 2 per cent of one year’s GDP. The reparation loan would amount to less than an additional 1 per cent. The unwillingness to just pay up itself signals weakness.
Second, it of course makes sense to use Russia’s money against it. But this is the second sleight of hand, to put it politely. The reparation loan plan will not touch Russia’s legal claims, which now basically consist of gargantuan bank deposits (think of the cash account sitting next to your investment account) that are blocked at Euroclear Bank in Belgium and a few other European banks. All the plan will do is to force those banks to lend the cash they have accumulated as a result of not being allowed to honour Moscow’s withdrawal requests, to the EU at zero interest margins so the EU can lend it on to Ukraine. But the fundamental insistence on protecting Moscow’s property rights also signals weakness, not strength.
So why the fuss? Partly because to make the financial engineering work, the EU now wants to lock Russia’s claims down indefinitely, rather than with the six-monthly unanimous renewal that is currently required and that Hungary could torpedo each time. That is a bold move. Both against Russia, for obvious reasons, but also against the US, because it would make it harder for Washington to dispose of these assets in some bilateral deal with Moscow, as Witkoff’s 28 points attempted. And against Hungary, because Brussels has found a treaty article that it says lets the EU do this by a qualified majority vote.
There is nothing herbivore about this. I am not yet sure it’s going to happen, though it’s more likely than not. And one way or the other, I think it’s a safe bet that the EU will find a way for substantial new funding to come Kyiv’s way soon. That, too, is not herbivore.
The puzzle is why Europeans are so selectively bold — willing to be creative about the EU’s own foundational rules, for example, but not willing to just go ahead and enforce the incontrovertible Russian obligation to pay reparations to Kyiv straight out of the blocked money. It’s in this strange inconsistency that danger lies — witness how Belgium’s prime minister Bart De Wever has in the past week sounded like a Russian propagandist when he ridiculed the idea that Russia could be defeated and made to pay reparations.
But I think Europe is quickly developing calluses to cover more and more of its soft spots. To rhyme with Churchill’s adage about America — they will do the right thing after exhausting all the other possibilities — maybe the EU will go for meat once it has tried all the vegetarian options.
Your feedback
We’d love to hear from you. You can email the team on swampnotes@ft.com, contact Ed on edward.luce@ft.com and Martin on martin.sandbu@ft.com, and follow them on X at @MESandbu and @EdwardGLuce. We may feature an excerpt of your response in the next newsletter