Mario Draghi has returned to an argument he has made, in different forms, since the euro crisis: Europe’s capacity to defend its interests depends less on rhetoric than on the institutional machinery that converts economic weight into political power.
In a recent commentary and related remarks in Belgium, the former European Central Bank president and ex-Italian prime minister contends that the European Union is behaving as though it were weaker than it is — and that, in a harsher international climate, it cannot afford to remain a “loose club” of vetoes and ad hoc coordination.
Draghi’s starting point is that the post-Cold War settlement, built around expanding trade, predictable rules, and US security guarantees, is no longer a reliable operating environment for European policy. He argues that the central risk is not simply slower globalisation, but the “weaponisation” of interdependence: trade and finance being used as instruments of coercion, and security commitments being treated as transactional.
From that diagnosis he draws a political prescription he calls “pragmatic federalism”. Rather than a single constitutional leap to a federal Europe, Draghi proposes coalitions of willing member states pooling sovereignty in defined areas where Europe’s fragmentation carries the highest strategic cost. In his account, the model is not theoretical: it echoes the way in which earlier integration advanced in practice — through opt-in arrangements, and through policy domains where joint action created bargaining leverage.
The emphasis falls on three fields: defence, finance, and the broader capacity to project power externally. Defence is the most obvious, because it exposes the EU’s mismatch between economic scale and military readiness. Draghi’s argument is not that Europe should duplicate Nato, but that it needs a European capability to procure, finance, and deploy at speed — and, crucially, to sustain defence industry output at levels that deterrence now requires. Where decision-making remains national and unanimous, he suggests, Europe is “pick-off” vulnerable: states can be pressured individually, and collective action can be delayed until the moment has passed.
Finance is the second pillar because it underwrites everything else. Draghi frames Europe’s challenge as partly one of mobilisation: Europe saves heavily, but its capital markets remain fragmented and its risk-bearing capacity is weaker than that of the United States. In this view, strategic autonomy is not only about weapons and diplomacy; it is also about whether Europe can finance large-scale investment in defence, energy resilience, and advanced technology without relying on external capital or improvised crisis instruments.
This is where “pragmatic federalism” becomes politically sensitive. It points towards shared instruments and joint decision-making, whether through deeper integration of capital markets, common borrowing, or new fiscal arrangements among participating states. Draghi’s formulation is designed to avoid the immediate Treaty battle that a formal federal project would invite. Yet it still implies a shift in the balance between national autonomy and collective competence — and, in practice, would test the EU’s tolerance for variable geometry in core state functions.
His intervention lands amid an already active debate across EU capitals about how to organise European power in an era of geopolitical competition. The language of “strategic autonomy” has been in circulation for years, but it has often stalled on the mechanics of implementation: who decides, who pays, and which legal base applies. Draghi is, in effect, arguing that the institutional question can no longer be deferred.
There is also an enlargement dimension. Draghi suggests that Europe’s posture cannot be separated from its neighbourhood and the credibility of its commitments. If the EU is to integrate Ukraine more closely, manage relations with Turkey, or reframe ties with the UK, it needs decision-making structures that can absorb new alignments without paralysis. Incremental or staged integration — bringing partners into selected policies before full membership — becomes more plausible if the EU can act decisively in the areas it selects for deeper coordination.
Draghi’s approach avoids a direct call for a constitutional convention, but it still challenges the habits of EU governance. A coalition-of-the-willing method can accelerate action; it can also accentuate divisions between insiders and outsiders, and raise questions about democratic accountability when major strategic decisions are taken by sub-groups. Supporters argue that the alternative is drift: Europe talking like a power while operating like a committee. Critics counter that partial federalisation can entrench a two-tier Europe and trigger domestic backlash.
Draghi’s wager is that action itself can create momentum — that tangible projects in defence procurement, industrial capacity, and financial integration will do what abstract debates about sovereignty cannot. In a Europe that has often treated federalism as a taboo word, “pragmatic federalism” is offered as a way to change the subject from ideals to capabilities. Whether member states accept that framing will shape not only Europe’s strategic posture, but the limits of what the EU can plausibly promise in a world that is becoming less forgiving.
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