Trade Flop Shows Europe Can’t Afford to Delay Reforms

Whether the White House “won” its trade negotiations with the European Union is debatable: Americans will now pay more for French wine and German cars, while Europeans get a tax cut on US goods. Nonetheless, the talks clearly exposed Europe’s lack of leverage. To gain more, the bloc must rapidly improve its competitiveness, starting by mobilizing the trillions of euros in investment needed to fund innovation, strengthen its militaries and decarbonize.

Obscured in all the focus on tariffs has been the fact that the bloc finally has a plan worth pursuing. The European Commission’s Savings and Investment Union is its most coherent attempt yet to integrate fragmented capital markets. The goal is simple: to turn Europe’s €35 trillion ($41 trillion) in household savings — much of it trapped in bank deposits — into more productive investment.