Three shocks that shook us in 2025

This was the year that the remaining pillars of the late-20th-century order were shattered, exposing the hollow core of what passed for a global system.

- Yanis Varoufakis

Three blows sufficed.The first was Russia's impending victory in Ukraine over Europe's combined leadership. For almost four years, the European Union and Nato engaged in a perilous double game. On one hand, they committed rhetorically to a Ukrainian victory they were unwilling to bankroll. On the other hand, they exploited this never-ending war to advance a new political and economic domestic consensus: military Keynesianism would be their last-ditch stand against Europe's deindustrialisation.

In a continent where debilitating political constraints forbade significant deficit-funded green investments or social policies, the war in Ukraine provided a powerful rationale for funnelling public debt into the defence-industrial complex. The unspoken truth was that a forever war served a critical function: it was the perfect engine for Keynesian pump-priming of Europe's stagnating economy.

The contradiction was fatal: If the Ukraine war ended with a peace deal, it would be hard to sustain this economic pump-priming. Yet to achieve a victory that would justify the spending was deemed too expensive financially and too risky geo-strategically. Thus, Europe settled on the worst possible strategy: sending just enough equipment to Ukraine to prolong the bleeding without altering its course.