This is Europe's secret weapon against Trump: it could burst his AI bubble | Johnny Ryan

"The unthinkable has happened. The US is Europe's adversary. The stark, profound betrayal contained in the Trump administration's national security strategy should stop any further denial and dithering in Europe's capitals. Cultivating resistance Europe's current trajectory in European nations is now Washington's stated policy. But contained within this calamity is the gift of clarity. Europe will fight or it will perish."

"The US's bet on AI is now so gigantic that every Maga voter's pension is bound to the bubble's precarious survival. AI investment now rivals consumer spending as the primary creator of American economic growth. It accounted for virtually all (92%) GDP growth in the first half of this year. Without it, US GDP grew only 0.1%."

"First, Dutch company ASML commands a global monopoly on the microchip-etching machines that use light to carve patterns on silicon. These machines are essential for Nvidia, the AI microchip giant that is now the world's most valuable company. ASML is one of Europe's most valuable companies, and European banks and private equity are also invested in AI. Withholding these silicon-etching machines would be difficult for Europe, and extremely painful for the Dutch economy."

The Trump administration's national security strategy frames the US as an adversary of Europe, prompting a call for cultivated resistance across European capitals. AI investment now drives almost all US GDP growth, accounting for 92% of growth in the first half of the year; without AI, US GDP rose only 0.1%. Trump's political and economic positions on AI show weakness, evidenced by failed attempts to pass an AI moratorium in the Senate and ideological splits within his coalition. Europe possesses strategic leverage, notably ASML's monopoly on chip-etching machines and significant European financial exposure to AI investments, which could influence US AI capacity.

Read at www.theguardian.com