The United States is by far the largest economy in the world. This development did not happen by chance, as the U.S. long enjoyed a reputation as a stable, democratic, and liberal economic power—a place where virtually anything was possible. Think of the “American Dream” formula. For generations of Europeans, this was the engine and motivation to emigrate to the United States in search of a fresh start. However, recent developments leave a bitter aftertaste, and the once-celebrated America is increasingly losing its luster.

At first glance, we Europeans might feel far removed. One could argue that developments in the U.S. do not concern us. The opposite is true. With the collapse of the unipolar world order, we are heading toward a new, multipolar rearrangement. This leads to new power coalitions and conflicts, which we had largely avoided over the past 30 years. Revisionist ambitions are emerging among certain political actors, and it cannot be ruled out that even more armed conflicts could occur than are already ongoing.

For globally operating companies, new challenges arise. The days when business could be conducted without significant trade barriers are already over. America’s “fall” is forcing us to rethink trade relations and supply chains. We must enter a sort of emergency mode, focusing intensively on crisis management and resilience. Prioritizing ever leaner and more efficient structures and processes is no longer sufficient and can quickly lead to the collapse of entire industries and enterprises.

Specifically, with regard to dependence on the U.S., we must ask ourselves the following questions and find new answers:

• How can the U.S. market be compensated for by new customers or markets? Depending on the scale, this is no trivial task and requires significant lead time.

• European companies are heavily dependent on U.S. digital solutions (META, Microsoft, ChatGPT, etc.). Are there alternatives, and what would be the financial and time-related consequences of switching providers?

• American dominance in the security and defense industry creates dependencies for European armed forces, hindering the development of national and alliance defense capabilities and potentially calling the deployment of critical systems into question. Can European system integrators become independent with their own products and components?

• A rapprochement between the U.S. and Russia could result in a two-front conflict for Europe: an economic war in the West and military confrontations in the East. Both together would represent an enormous and nearly unmanageable challenge for the EU. The Russian war of aggression in the East is beyond the influence of individual companies, but in terms of American dependencies, options for de-escalation can already be explored.

• The transformation of a presidential democracy with checks and balances into a “dictatorial democracy” can lead to arbitrary actions that negatively impact businesses. European investments in the U.S. are thus exposed to higher default risks, potentially leading to negative assessments by rating agencies. What scenarios are conceivable, and how should they be managed?

• U.S. pressure on China could negatively affect the trade balance between China and the EU, as intensified trade between the EU and China might be perceived as a provocation or even sanctioned. Here too, the question of alternative markets, preferably regional customers and suppliers, must be addressed.

The U.S. “fall” affects us on multiple levels and should by no means be dismissed as trivial or temporary. Recent months have shown how quickly far-reaching changes can be implemented in favor of an elite of oligarchs, despite all references to checks and balances.

The era in which America was regarded as a stable guarantor of prosperity and security is coming to an end. Those who rely on the old rules simply continuing risk being caught off guard by these upheavals. Europe must now act—sovereign, resilient, and forward-looking—or dependence on a staggering giant will come at a high cost.