Does Europe Have What it Takes to Fight Russia?

Summary

WSJ What’s News – Episode Summary: “Does Europe Have What it Takes to Fight Russia?”
Release Date: March 14, 2025
Host: Kate Bullivant (The Wall Street Journal)

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1. US Government Funding and Avoiding a Shutdown

The episode opens with a crucial discussion on the political maneuvering in the US Senate to prevent a government shutdown. Senate Majority Leader Chuck Schumer made a politically bold move by supporting a Republican funding bill, despite potential backlash from his own party.

• Chuck Schumer on His Decision:
  "There is no good option," Schumer stated at [01:45], emphasizing that a shutdown would be more detrimental than the GOP bill.

The GOP’s funding bill aims to provide the Trump administration with increased flexibility to downsize federal agencies, a contentious issue among Democrats. Schumer argued that allowing a shutdown would empower President Trump to lay off federal workers beyond those agencies already targeted, framing the decision as a lesser evil to maintain government operations.

Additionally, judicial interventions have complicated the funding scenario:

• Judicial Rulings:
  "A US District judge in California yesterday ruled that probationary workers officers from six federal departments... should be offered their jobs back immediately," as reported at [02:06].
  "Later in the day, a US District judge in Maryland issued a similar ruling," reinforcing the administration's challenges in maintaining workforce stability.

2. Trump's Birthright Citizenship Initiative

The Trump administration is actively pursuing a controversial plan to restrict birthright citizenship, challenging the long-standing interpretation of the 14th Amendment.

• Legal Context:
  The administration asserts that children born in the US to parents without legal residency are not subject to US jurisdiction, thereby denying them citizenship. This initiative has been escalated to the Supreme Court, seeking to override lower court decisions that have blocked such decrees.

3. Market Movements: Record Gold Prices and Stock Market Volatility

The podcast transitions to financial markets, highlighting significant movements driven by global uncertainties and economic concerns.

• Gold Price Surge:
  "Gold rallied overnight to reach a record high of $3,000 a troy ounce for the first time ever," reported at [03:40]. Europe finance editor Alex Frangos elucidates the factors:

  • "There's a lot of uncertainty in the world and gold is a millennia-old safe haven for investors," Frangos explains at [04:28].
  • Concerns about a potential recession and declining interest rates are making gold an attractive speculative asset, further driving its price upwards.

• Stock Market Correction:
  The S&P 500 has entered correction territory, dropping over 10% from its February high, reflecting heightened market volatility and investor anxiety amidst geopolitical tensions and economic uncertainties.

4. Versace’s Creative Transition and Brand Challenges

In the fashion industry segment, Donatella Versace's longtime creative director has resigned amid internal conflicts, impacting the brand's strategic direction.

• Internal Tensions:
  The creative director clashed with US Corporate Chief John Idol over strategies to broaden Versace's market appeal. Idol's attempts to diversify sales reportedly conflicted with Donatella’s established vision characterized by bright colors and bold prints since 1997.

• Potential Sale to Prada:
  Due to declining sales, insiders suggest that John Idol is considering selling Versace to luxury rival Prada, indicating significant shifts within the fashion powerhouse.

5. Europe’s Military Capability to Combat Russia Without US Support

A central focus of the episode is Europe’s ability to stand against Russian forces independently, especially in light of perceived wavering US commitment to NATO.

• Europe’s Military Strength:
  Dan Michels, the Journal’s Brussels bureau chief, provides an insightful analysis:

  • "At the moment, Europe together is a formidable fighting force," Michels remarks at [07:20].
  • Europe boasts over 2,000 combat planes compared to Russia's slightly more than 1,000, nearly doubling the aerial strength.
  • Historical performance indicators show that Russia has lost a significant portion of its fighter planes in Ukraine, underscoring Europe's tactical advantages.

• Concerns Over US Absence:
  Despite Europe's numerical superiority, the lack of US support raises critical concerns:

  • "Europe relies on the US for sort of the backbone of fighting, communications, intelligence, reconnaissance, surveillance, things that it's still possible to fight without them, but it's kind of like fighting blind," Michels explains at [08:59].
  • The US provides advanced military capabilities and experience from prolonged engagements in conflicts like Iraq and Afghanistan, which Europe currently lacks.

• European Response and Future Plans:
  To address these gaps, Europe is ramping up defense spending:

  • "Europe is going to be spending a lot more money on defense," Michels notes at [10:23].
  • This increased investment aims to build larger, more advanced militaries and develop robust military industries, potentially enhancing European independence but also risking increased regional tensions.

• Implications for Peace and Stability:
  While bolstering military capabilities may deter Russian aggression, it could also elevate tensions within Europe, as the historical precedent suggests that larger standing armies and armaments do not necessarily lead to long-term peace.

6. US and Ukraine Collaboration on Drone Technology

Shifting to technological advancements in military hardware, the podcast highlights a strategic partnership between the US and Ukraine in developing advanced drones.

• Drone Development Partnerships:
  "We have a smattering of official partnerships... leveraging all this Ukrainian know-how... with the software skills that American engineers really excel at," a KPMG representative explains at [12:08].

  • Ukrainian drone manufacturers, honed through years of conflict, are collaborating with US startups to produce more reliable and advanced drones for future military applications.

• Challenges and Opportunities:
  Despite significant investment, many US-developed drones struggle with performance issues. This collaboration aims to harness Ukrainian expertise to overcome these challenges, potentially revolutionizing drone technology for the Pentagon's needs.

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Conclusion

In this episode of WSJ What’s News, host Kate Bullivant navigates through a complex landscape of political decisions in the US Senate to prevent a government shutdown, market fluctuations driven by global uncertainty, and significant shifts in Europe’s military strategies amidst questions of US support. The discussion underscores Europe's formidable yet challenged position in potentially confronting Russia independently, highlighting both their strengths and the critical support they lack from the US. Additionally, innovative collaborations in drone technology between the US and Ukraine signal evolving dynamics in modern warfare. This comprehensive analysis provides listeners with a nuanced understanding of the interplay between politics, economics, and military strategy shaping today’s global landscape.

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Notable Quotes:

• "There is no good option," – Chuck Schumer ([01:45])
• "Europe relies on the US for sort of the backbone of fighting, communications, intelligence, reconnaissance, surveillance, things that it's still possible to fight without them, but it's kind of like fighting blind," – Dan Michels ([08:59])
• "We have a smattering of official partnerships... leveraging all this Ukrainian know-how... with the software skills that American engineers really excel at," – KPMG Representative ([12:08])

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Produced by Daniel Bark and Sandra Kilhoff. For more insights and detailed analyses, tune into future episodes of WSJ What’s News.

Transcript

[KPMG Representative]

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[Kate Bullivant]

Democrats clear the way for the GOP funding bill ending the threat of a government shutdown plus, with America's commitment to NATO suddenly in, European leaders grapple with the unthinkable facing Russia alone.

[Dan Michels]

Europe relies on the US for the backbone of fighting communications, intelligence, reconnaissance, surveillance, things that it's still possible to fight without them. But it's kind of like fighting blind.

[Kate Bullivant]

And the price of gold reaches a record high. It's Friday, March 14th. I'm Kate Bullivant for the Wall Street Journal, filling in for Luke Vargas. And here is the AM edition of what's News, the top headlines and business stories moving your world Today, Senate Democrats are planning to help advance a Republican measure to fund the government in a vote this afternoon ending the threat of a shutdown. Democrats had struggled for days on how to approach the GOP bill, which gives the Trump administration more flexibility to downsize and dismantle federal agencies. Senate Majority Leader Chuck Schumer said there was no good option, adding he would back the GOP measure because the prospect of a shutdown was worse. Siobhan Hughes covers Congress for the Journal.

[KPMG Representative]

Schumer's decision is a politically risky one. He is set to lose more than half of the Democratic caucus as he votes in favor of the Republican bill to keep the government open. A shutdown, Schumer argued, would give President Trump even greater power to lay off federal workers beyond those in agencies he has already targeted.

[Kate Bullivant]

Senate Republican leaders have scheduled a procedural vote for this afternoon. Without action, the government will shut down at one minute past midnight on Saturday, furloughing hundreds of thousands of workers and stopping non essential services. At the same time, two judges have now ordered the Trump administration to reinstate thousands of probationary workers who were fired at a number of federal agencies. As we mentioned on our PM show, a US District judge in California yesterday ruled that probationary workers officers from six federal departments, including Agriculture and Veterans affairs, should be offered their jobs back immediately, describing their firing as a sham. Later in the day, a US District judge in Maryland issued a similar ruling in a case brought by 20 Democratic led states and the District of Columbia, saying employees at 18 agencies should get their jobs back. The Trump administration has brought its plan to restrict birthright citizenship to the Supreme Court, asking the justices to scale back lower court orders blocking the president's decree of denying citizenship to children born in the US to parents without legal residency. Although the case is in preliminary stages, the emergency request will force the justices to weigh in on one of the most aggressive moves made by the new administration. The 14th Amendment provides all persons born or naturalized in the U.S. and subject of the jurisdiction thereof are citizens of the United States. In an inaugural Inauguration Day order, Trump asserted that children born to people lacking permanent residency aren't subject to US Jurisdiction and therefore don't hold citizenship, essentially arguing that the long standing interpretation of the 14th Amendment is mistaken. Turning to markets now and Gold rallied overnight to reach a record high of $3,000 a troy ounce for the first time ever. Prices for gold have been rising shar over the past year, with the yellow metal having already surpassed the 2025 price target set by many Wall street forecasters. Journal Europe finance editor Alex Frangos says there's a few things driving gold higher.

[Alex Frangos]

One is there's a lot of uncertainty in the world and gold is a millennia old safe haven for investors. There's concern about the economy going into a recession and interest rates falling. And when interest rates are going down, that makes gold more the last thing is gold is a speculative asset. It is used for certain things like jewelry and microchips. But most demand for gold is people thinking that gold is going to be worth more tomorrow than it is today. And when that frenzy starts, it takes on a life of its own.

[Kate Bullivant]

And the flight to safety could have further to run. Amid stock market volatility yesterday, The S&P 500 fell into correction territory, having declined more than 10% from its record high on February 19. In the fashion industry, few people are as synonymous with a brand as Donatella Versace. But now Versace's longtime creative director has stepped down following tensions between the Italian designer and the US Corporate chief. John Idol's ideas to pump up sales by appealing to a wider audience often clashed with those of Donatella, who as creative director has defined the brand's looks featuring bright colors and bold prints since her brother's murder in 1997. The change comes amid a decline in Versace's sales. And, as people familiar with the situation tell us, Idol is exploring a potential sale to Italian rival Prada. Coming up With America's commitment to NATO falling on shaky ground, does Europe's military have what it takes to fight Russian forces without U.S. support? That story after the break.

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[Kate Bullivant]

With America's commitment to the North Atlantic Treaty Organization suddenly in doubt, Europe is having to consider the once unthinkable could its armies fight Moscow's forces without US support? Journal Brussels bureau chief Dan Michels has been speaking to top American military brass and officials who've served across the atlant, and they say Europe would pack a strong punch. Dan, you've been looking at Europe's military capabilities. How do they stack up against Russia's?

[Dan Michels]

At the moment, Europe together is a formidable fighting force. Individually, the countries are not so strong and they do lack certain capabilities that the US has, but they constitute a really quite large army, air force and navy. And the verdict of the Americans and Europeans who I've spoken to about this is that in a fight directly with Russia, the Europeans are formidable and would give the Russians a pretty serious black eye, hold them off. Europe, for example, has an enormous air force combined and are buying more new advanced, especially American F35 fighter planes. Europe together has more than 2,000 combat planes. Russia has slightly more than 1,000. So Europe is almost double the size and the performance of the Europeans probably is much better. By some estimates, one in five fighter planes that the Russians have sent into Ukraine has been lost, shot down, had some kind of accident, and that's against a much less well prepared military the Ukrainians than the Europeans. The Europeans, even though they've provided a lot of equipment to Ukraine, still have quite vast armories of even more advanced equipment waiting, precisely because of fear of Russia.

[Kate Bullivant]

So if these numbers are looking in Europe's favour, why is the absence of the US such a concern to European leaders?

[Dan Michels]

Two reasons. One is Europe for decades has assumed it would always fight against Russia with the us. So going back to the start of the Cold War, there's been the alliance of NATO, and so the thought that it might not be there is upsetting and prompting Europeans to reassess their fundamental understanding of the alliance. The more perhaps tangible element is the US has military capabilities and equipment that Europe simply doesn't have. The US has the world's largest and most advanced military, also the most experienced at the moment because the US has been fighting in places like Iraq and Afghanistan for years. And so if there were a fight between Europe and Russia, the Europeans would not have air defenses, for example, against long range Russian rockets, missiles, and some kinds of artillery, which would put, for example, European cities at risk. Europe relies on the US for sort of the backbone of fighting, communications, intelligence, reconnaissance, surveillance, things that it's still possible to fight without them, but it's kind of like fighting blind.

[Kate Bullivant]

So given all that, what are European leaders doing to fill this gap?

[Dan Michels]

To fill the gap of US Capabilities would take years and cost hundreds of billions of dollars, if not more. So there's not a lot the Europeans can do immediately, but it has become fairly clear over recent weeks that Europe is going to be spending a lot more money on defense. And so Europe in the not too distant future will have bigger militaries, it will have more weapons, and it will have bigger military industries. This, on one level, will make Europe potentially more independent of the US it will also mean that Russia would have a harder time launching an attack on Europe, which might have a deterrent effect. But it might also conversely, just generally increase the level of tension in Europe, because having standing armies and lots of weapons in the past has not always been a recipe for peace.

[Kate Bullivant]

So not exactly the relative time of peace that Europe has been enjoying over the last 30 years. Dan, thank you for breaking this down for us.

[Dan Michels]

Thanks. Always good to talk with you.

[Kate Bullivant]

And while Europe may be learning to go it alone, the US Is actually turning to Ukraine for help building better drones. Since the start of the war, Ukrainian forces have been relying on increasingly sophisticated drones to battle Russia's army. And despite limited resources, drone makers in Ukraine have found a way to mass produce use them. That's piqued the interest of US Startups who are spending billions of venture capital dollars to develop small drones that the Pentagon says it needs for future conflicts. But most of them don't fly well. Here's tech reporter Heather Somerville.

[KPMG Representative]

Since the start of the war, there's been a lot of interaction between US and Ukrainian drone companies. So what we have now is we have a smattering of official partnerships, businesses that have been created through a combination of US Autom entrepreneurs and Ukrainian drone manufacturers. And what they're trying to do is leverage all this Ukrainian know how that has been developed over more than three years of war. With the software skills that American engineers really excel at. Combining those things together, the hope is we'll start to have some really seriously good drones that the U.S. defense Department can begin to buy and you can.

[Kate Bullivant]

Hear more about how Silicon Valley is tapping into the know how of Ukraine's well trained drone makers over on our Tech News Briefing podcast. And that's it for what's news for this Friday morning. Today's show was produced by Daniel Bark with supervising producer Sandra Kilhoff. And I'm Kate Bullivant for the Wall Street Journal filling in for Luke Vargas. We'll be back tonight with a new show. Until then, have a great weekend and thanks for listening.