Mujtaba Rahman is the head of Eurasia Group’s Europe practice. He posts at @Mij_Europe. It all looked rather bleak for France a little over a week ago, as President Emmanuel Macron’s former Prime Minister Edouard Philippe seemingly wrecked his successor’s deficit-cutting strategy. While Prime Minister Sébastien Lecornu was working toward a deal with the Socialists in his country’s fractured National Assembly, the 34 centrist lawmakers of Philippe’s Horizons party unceremoniously announced they would abstain or oppose the government in a key vote on the social security budget set to be held Tuesday evening. The eventual narrow win in favor of a relatively generous social security budget, covering pensions, health and welfare, is thus a godsend for Macron’s embattled prime minister — turns out, he may just survive. However, it doesn’t guarantee an agreement on the main state budget before the Dec. 23 deadline, and Lecornu will likely struggle to deliver another surprise victory over the next two weeks. Ahead of Tuesday evening’s final tally, the prime minister made a string of last-minute concessions to the Socialists and the Greens on health spending to get their votes or abstentions. And he eventually succeeded in securing a small majority by 247 to 234 votes. However, to keep next year’s welfare deficit below €20 billion — already up from the €17.5 billion originally proposed — Lecornu transferred an extra subsidy of at least €4.5 billion from the main budget, which covers everything from education to defense. And it remains unclear where exactly this money will be found, while still meeting the government’s promise to reduce France’s overall deficit from 5.4 percent of gross domestic product to “below 5 percent” next year. Still, Lecornu hopes his unlikely success with the social security budget in the National Assembly will create momentum for a deal on the main budget. Moreover, Tuesday’s victory — though limited and hard fought — is without precedent. No previous budget in France’s Fifth Republic has been negotiated and agreed on by an ad hoc coalition of government and opposition. So, as attention now turns to the main state budget, Lecornu’s balancing act will prove even trickier. | Julien De Rosa/AFP via Getty Images The problem is, the prime minister’s concessions to the moderate left — abolishing a planned freeze on pensions and welfare payments, boosting a 2 percent planned increase in health spending to 3 percent, and suspending pension reform — infuriated two of the four parties in his fragile centrist coalition. So, as attention now turns to the main state budget, Lecornu’s balancing act will prove even trickier. Upon its first reading in the National Assembly, this budget was rejected by 404 votes to one. And the French leader will be hard-pressed to find concessions for the moderate left, appease his coalition and keep his promise to reduce the deficit. As France’s third prime minister in the last 12 months, Lecornu has no majority in a National Assembly that’s currently split into 11 groups. In order to avoid a censure motion, he has also promised not to use his government’s special constitutional powers (Article 49.3) to impose legislation without a parliamentary vote, and has so far rejected pressure from within his own camp to reverse that decision. Simply put, using this power and facing censure is not a risk Lecornu is likely to take — especially since he wouldn’t resign if he lost the upcoming budget vote. He would instead argue the rejected budget deal was an attempted compromise and not his responsibility alone. Paradoxically, part of Lecornu’s problem is that he’s now expected to survive. Previously, the center, center right and Socialists agreed to abstain from voting, as they feared a government collapse and snap parliamentary elections in January, right before the important municipal elections in March. But now that this fear has subsided, Philippe and the center right can take the risk of wrecking the budget deal. To that end, Lecornu and his government are now preparing emergency legislation to roll over this year’s budget to keep the French state operational, and lawmakers have been warned they may be called in for a special session to pass such a stopgap budget in late December. According to the ministry of finance, though, if a rolled-over 2025 budget were to last throughout next year, it would push France’s deficit beyond 6 percent of GDP. In fact, even a delay of two or three months could, in theory, significantly weaken efforts to reduce the budget deficit, as under French law, authorities can’t retroactively apply any tax increases that lawmakers eventually approve. Still, it would at least allow Lecornu to hang on and fight another day. But the outlook for France is looking no brighter than before.

John Kampfner is a British author, broadcaster and commentator. His latest book “In Search of Berlin” is published by Atlantic. He is a regular POLITICO columnist. When it comes to the war in Ukraine, predictions don’t last long. One minute U.S. President Donald Trump’s acting like his Russian counterpart Vladimir Putin’s emissary, the next he’s giving Ukrainian President Volodymyr Zelenskyy a reasonable hearing, and then it’s back again to the Kremlin camp. With the U.S. administration increasingly taking on the role of unreliable broker over a staunch ally, Europe is in a parlous position. And what has struck me most during a series of security briefings and conferences I’ve attended in Berlin and elsewhere this autumn, is the extent of the alarm. Yet, much of the time, this remains hidden behind closed doors. One of the few crumbs of comfort is that the E3 nations of Germany, France and Britain are seeking to confront this cold reality in unison. After the trauma of Brexit, and all the bickering between former German Chancellor Olaf Scholz and French President Emmanuel Macron in recent years, the mood has changed — because it had to. If Europe is to survive a future attack by Russia — and that is the kind of language being used — its big players must behave in a way they haven’t done before. They must be joined at the hip. As more than a dozen officials have made clear in a series of discussions, the cost of inaction would be far greater than the cost of supporting Ukraine has been so far. Not only would Putin be emboldened to go even further, Europe would also be engulfed by a wave of Ukrainian refugees far greater than anything experienced before. And this realignment was visible amid the pomp and circumstance of German President Frank-Walter Steinmeier’s state visit to the U.K. last week, as both he and King Charles affirmed what they described as a deep bond between the two countries — one that’s been reinforced by the shared threat of Russian expansionism. Meanwhile, the real business taking place at the government level is intense. British Prime Minister Keir Starmer and German Chancellor Friedrich Merz have developed a genuine affinity, stemming from a shared view of current foreign-policy perils and their domestic-policy troubles. A British prime minister of the center-left and German chancellor of the center-right are finding common cause in their double adversity. The loss of the U.S. as a friend in need is what’s forcing this realignment for both countries. Of course, neither publicly dares admit the situation is as bad as it is, but the optics say everything that needs to be said. Just compare Trump’s state visit in September — with its high security, taut smiles and desperate obsequies by his hosts – and the relaxed conviviality of Steinmeier’s. And dominating everything is security — though it’s less a “coalition of the willing” and more a “coalition of the surrounded.” Or, as one German security official, granted anonymity to speak freely, explained: “If the Americans are now acting as mediators between Russia and Europe, they no longer see themselves as partners within NATO.” In practical terms, the U.S. is still the driving force behind the alliance, notionally at least. As another German military figure, also granted anonymity to express their views, put it: “The harsh truth is that Europe’s readiness level to combat any Russian aggression doesn’t yet exist. Until that time, we are reliant on the U.S. to act as a backstop.” But that penny should have dropped last February, when U.S. Vice President JD Vance dropped his various bombshells at the Munich Security Conference, attacking European democracies, praising the far-right Alternative for Germany party and serving notice that the U.S. no longer felt beholden to past allegiances. The real surprise is that anyone’s been surprised by the Trump administration’s actions since then. Even now, some are continuing to cling to the hope that this isn’t the united view in Washington, and that others within the administration still wield a certain influence. This isn’t how security planners in Germany or the U.K. see things, but it seems many politicians — and much of the public — are yet to be convinced of just how serious the situation has become. One minute U.S. President Donald Trump’s acting like his Russian counterpart Vladimir Putin’s emissary, the next he’s giving Ukrainian President Volodymyr Zelenskyy a reasonable hearing. | Pool Photo by Will Oliver via EPA Their alarm will have been reinforced by the second Trump administration’s first National Security Strategy. Published only a few days ago, it condemns many of the liberal values underpinning European democracy, while praising the nativist, nationalist rhetoric of the far-right — and implicitly of Putin.  Previously, the dominant narrative around Europe was about German reluctance, whether brought about by postwar guilt and pacificism or complacency. But while that has been replaced by a new determination, exactly how deeply is it entrenched? The commitment across NATO to increase defense spending to 5 percent of national GDP — 1.5 percent of which can be spent on “critical infrastructure” — certainly allows for much budgetary dexterity. But Berlin’s borrowing power gives it a freedom its neighbors can only envy. Britain’s financial travails are considerably more acute, and for all his tough talk, several defense contractors suspect Starmer is going slow on defense orders. As it stands, Germany is expected to spend €153 billion a year on defense by 2029. France, by comparison, plans to reach about €80 billion by 2030, and the U.K. currently spends £60 billion — a figure set to rise to £87 billion by 2030 — but looking at current predictions, will only hit its 3.5 percent target in 2035. For the governments in London and Paris, budgets are so tight and public service spending requirements so great — not to mention debt interest payments — the push-and-pull with security needs will only become more intense. And while opinion polls vary from country to country and depending on how questions are phrased, the growing concern among many defense officials is that if Ukraine is pressured enough to accept some form of Trump-Putin dirty deal, public support for military spending will decrease. “Job done” will be the sentiment — except, of course, it won’t be. For Putin, it can’t be. The Russian leader has tied his political survival, his power infrastructure and his country’s economy to the notion of an encircling Western “threat.” Hence his recent remarks about Russia being “ready” for war if Europe wants to start one — he simply can’t afford to stop invoking threats. But the original 28-point plan for Ukraine — which the U.S. initially denied came directly from the Kremlin — represents Europe’s worst nightmare. And if a spurious “peace” is imposed by any deal approximating that one, Germany, the U.K., France and their other European allies, including Poland, Finland, the Baltics, Nordics and (more cautiously) Italy, will know they’re out on their own. It would mark the return of big-power politics, a Yalta 2.0. It would enshrine NATO’s de-Americanization, a structural incapacity for Ukraine to defend itself, and confirm that, as far as the U.S. is concerned, Russia enjoys a veto on European security. “We say it’s existential, but we don’t yet act as if it is,” said one British defense official, speaking on condition of anonymity. The task for Merz, Starmer and Macron is then to accept — and admit to their publics — that they only have each other to rely on.

PARIS — A generational reckoning is brewing in Paris and Berlin, where a new wave of younger politicians is putting pensioners on notice: The system is buckling and can’t hold unless retirees do more to help fix it. Culture, language and local politics may add a distinct flavor to each debate, but the European Union’s two biggest economies are dealing with the same issue — how to pay for the soaring costs associated with the retirement of baby boomers.   The problem is both demographic and financial. Declining birthrates mean there aren’t enough young people to offset the boom in retirees at a time when economic growth is sluggish, salaries have stagnated and purchasing power isn’t evolving at the same rate as it did for previous generations. And with the cost of real estate skyrocketing, young people feel that buying a home and other opportunities afforded to their parents’ generation are increasingly out of reach.  With budgets already strapped thanks to priorities such as rearmament in the face of Russian aggression, reindustrialization and the green transition, a growing number of young politicians from the center to the right of the political spectrum are calling out retirees for not contributing to the solution.  Some lawmakers in Germany, like 34-year-old Johannes Winkel, are calling for greater “intergenerational justice.” The 38-year-old French MP Guillaume Kasbarian is going a step further, arguing France should rethink its pay-as-you-go system — similar to Germany’s — in which current workers fund retirees’ pensions through taxes. The 38-year-old French MP Guillaume Kasbarian is going a step further, arguing France should rethink its pay-as-you-go system — similar to Germany’s — in which current workers fund retirees’ pensions through taxes. | Amaury Cornu/Hans Lucas/AFP via Getty Images Targeting pensioners is a politically dangerous proposition. They are a reliable voting constituency, heading to the ballot box in greater numbers than younger generations — and they lean centrist. German Chancellor Friedrich Merz’s conservative bloc got an estimated 43 percent of the vote among people aged 70 and above in February’s general election, and older voters helped Macron secure reelection in 2022.  French Budget Minister Amélie de Montchalin told lawmakers last month that she didn’t “want to trigger a generation war” over the government’s fiscal plans for next year.  But she — and her counterparts across the Rhine — may not have a choice. ‘FAIR TO ALL GENERATIONS’ Lawmakers in France are sparring this week over a highly contentious plan to freeze inflation adjustments on pension payments next year, part of a wide-ranging effort to trim billions of euros from the budget and get the deficit below 5 percent of gross domestic product. The debate in France echoes similar conversations in Germany, where Winkel is among a group of young conservatives who rebelled against a pension reform package put forth by Merz’s government, saying current benefits for older people are too generous and asking for a plan that is “fair to all generations.”   A group of leading economists argued in an op-ed in German newspaper Handelsblatt that Merz’s proposed pension package would be “to the detriment of the younger generation, who are already under increasing financial pressure.”   The leaders of Germany’s coalition set out to resolve the dispute last week, with Merz vowing to take on a second, more far-reaching set of pension reforms as early as next year.   Winkel is among a group of young conservatives who rebelled against a pension reform package put forth by Merz’s government, saying current benefits for older people are too generous and asking for a plan that is “fair to all generations.”  | Photo by Nadja Wohlleben/Getty Images But it’s unclear whether that proposal has appeased all young conservatives. In a letter this week, the group said its 18 lawmakers would decide individually how they will vote on the immediate pension package, which is set to go for a vote on Friday. Every vote will matter, as Merz’s fragile coalition has a majority of only 12 parliamentarians. On Tuesday, Merz’s center-right bloc held a test vote to see if there was enough conservative support to pass the pension reform package. The results of the internal vote were unclear. Opinion surveys in Germany and France show that much of the public favors protecting existing pension systems and benefits. Leftist parties in both countries have also strongly pushed back against measures that would freeze or lower pension benefits, arguing that the public pension system is a core element of social cohesion. But intergenerational cracks are emerging.  “Measures on pensions show a generational cleavage: They are massively rejected by pensioners but supported by nearly one out of two in the younger generation (18-24),” according to an analysis from French pollster Elabe published in October.  In another poll from Odoxa, a small majority of working-age people in France agreed that current pensioners are “better off because they were able to leave earlier than those still working.” KEY DIFFERENCES There are key differences between France and Germany, however. Pension benefits in France are far more generous than in Germany, and help keep the poverty rate among people aged 65 and above lower than that of the general population.  The opposite is true in Germany, where the over-65 population is worse off than those younger than 65, in part because public pensions became comparatively lower after pension reforms passed in the 2000s.  Ultimately, however, demographics and economics vary so much from one generation to another that it’s almost impossible to make a pension system “fair,” according to Arnaud Lechevalier, an economist at the Paris 1 Panthéon-Sorbonne University. The idea that each generation can have the same return on investment on their working-aged contributions is, in Lechevalier’s words, “a deeply stupid idea.”

Listen on * Spotify * Apple Music * Amazon Music Washington–Moscow peace maneuvers caught Europe off guard this week — raising questions about the EU’s continued relevance and readiness at a pivotal moment for Ukraine. Nick Vinocur, one of our regular guests, takes the host seat this time to speak with Veronika Melkozerova in Kyiv about how these peace talks look from inside a country still under attack. Then POLITICO’s finance reporter Bjarke Smith-Meyer and Wouter Verschelden, author of Belgium’s influential political newsletter W16, break down the EU’s internal fight over Russia’s frozen assets — arguably Europe’s strongest political and financial leverage in the peace-talk moment — and examine why Belgium continues to block the reparations loan Ukraine urgently needs.

BRUSSELS — Frustrated EU countries are ramping up pressure on Belgium to release €140 billion of frozen Russian reserves held in Brussels by accusing Bart De Wever’s government of failing to fully disclose what it does with the tax income from those immobilized assets. The European Commission wants the 27 EU countries to agree to send the Russian reserves as a reparations loan to Kyiv at a crunch European Council meeting on Dec. 18, in a drive to bail out the Ukrainian economy. But Belgian Prime Minister Bart De Wever is resisting — and ratcheted up his opposition on Thursday evening — arguing Belgium will be on the hook if Moscow claws back the billions. Five diplomats from various European countries, however, complained that Belgium appears to have a secondary agenda in holding onto Russia’s money thanks to the tax generated. They noted Belgium was breaking an international commitment — made last year — to disclose what it was doing with tax from the frozen reserves, which is supposed to go to Ukraine. The diplomats said the money was still being folded into the Belgian national budget, making it impossible to determine whether Belgium is fully living up to its commitments to Kyiv. The diplomats spoke on condition that they — and the countries they represent — remain anonymous. Belgium strenuously denies it is doing anything wrong. If Belgium continues to push back on sending the frozen funds to Kyiv, the diplomats said, EU member countries will increasingly use meetings in the run-up to the European Council summit to question whether Belgium is profiting from the tax income or delaying payments to Ukraine. They also query whether Belgium is using regular tax revenue to support Ukraine — as other European countries are — or is simply relying on tax from the Russian reserves. “In light of this ongoing foot-dragging behavior, one wonders whether it has actually been understood that it’s Europe’s security which is at stake here,” a senior EU diplomat told POLITICO.  “And in view of the data, there are doubts as to whether Belgium is delivering on its promise to sent its windfall tax gains to Ukraine.” The money is hard to track, but diplomats questioning the numbers use sources such as the Kiel Institute, which pegs Belgium’s total commitment to Ukraine at €3.44 billion between the start of the war and Aug. 31, 2025. To put that in context, the tax from the Russian assets totaled €1.7 billion in 2024 alone. The Belgian government rejected the criticism of the diplomats, saying that all the tax earned from the Russian reserves held in the Euroclear bank in Brussels was “earmarked” to Kyiv. It did not directly answer a question on whether all of it had already been paid. “The Belgian government has committed to allocating all corporate tax revenue from the interest income on Russia’s immobilized assets at Euroclear to support Ukraine,” said a Belgian official. “For 2025, this revenue is currently estimated at around €1 billion.” The Belgian government also insisted that the money paid to Ukraine came from Belgian federal government sources beyond the tax on assets. “In addition to the full use of the corporate tax on the windfall profits, which is fully used for military support to Ukraine, the Belgian federal government has provided since 2022 roughly just under 1 billion euros in military and other support to Ukraine,” the Belgian official wrote in a statement. Since the Russian assets are held by the Brussels-based depository Euroclear, the Belgian government levies a 25 percent corporate tax on profits generated from the interest on the holdings. “[This] funding is entirely earmarked for Ukraine and goes toward the provision of military-related support (military hardware, training, etc.) as well as limited civilian items such as ambulances,” the Belgian official continued. Part of the frustration among Belgium’s EU allies is that this lack of transparency was meant to be resolved last year. In 2024, several Western countries accused the Belgian government of using part of the tax revenues from assets to cover ordinary budgetary needs. In response to that criticism, the previous Belgian government pledged to transfer the tax revenues to an EU and G7 financial instrument for Ukraine. But Belgium never delivered on that promise. When asked why it was not using the special instrument to be transparent about the funds, the Belgian government did not reply. A second senior EU diplomat critical of Belgium had an explanation. “The tax revenue was already part of their domestic budget, and they didn’t want to give it up,” the envoy said.

Belgian Prime Minister Bart De Wever on Wednesday invoked Greek mythological hero Hercules as he celebrated striking a long-awaited budget deal. “We aren’t exactly on Mount Olympus yet in this country and I’m not standing here with a divine feeling … But at least the government has the courage to climb the path of Arete,” De Wever told lawmakers in the Belgian parliament. “We did not opt for laziness, but for the Herculean task of a multi-year budget.”  According to the ancient Greek tale known as The Choice of Hercules, the young man is approached by two figures. Kakia (vice) offers him a life of ease and pleasure, while Arete (virtue) promises a more demanding path of discipline and hardship, but one that leads to true honor and lasting glory. Belgium’s contentious budget talks were deadlocked for months as coalition parties haggled over a multi-year strategy to plug a €9.2 billion budget gap by 2029. They finally struck a deal Monday on the budget and related reforms, which helped avoid a government collapse. Ditching the Greek classics, De Wever opted for a more modern metaphor as he summarized his relief at finalizing the accord: “The exercise was anything but easy. After all, the low-hanging fruit has long since been picked away.” Attention now turns to the EU effort to pressure the unwavering De Wever into unfreezing the €140 billion in Russian assets held in Belgium that the bloc wants to use to help fund Ukraine’s war effort. Call it The Odyssey.

The EU will accelerate its plan to use frozen Russian state assets to underpin a €140 billion loan to Ukraine, European Commission President Ursula von der Leyen said Wednesday. During a speech at the European Parliament, she pledged to present a formal proposal outlining the scheme, in a relief for Ukraine’s war-battered economy. “The next step is now that the Commission is ready to present a legal text,” von der Leyen told lawmakers in Strasbourg — though she didn’t say when the document would be put forward. Europe’s plan to use the Russian sovereign assets to support a loan for Ukraine ran into fierce opposition at a summit last month from Bart De Wever, prime minister of Belgium, where the money is held.  But the question of how to use these funds has taken on new urgency as Ukraine peace talks intensify. To the EU’s dismay, U.S. President Donald Trump’s original peace plan suggested that Washington profits from the use of these assets in Ukraine, with a remaining share being handed back to Russia. Brussels, for its part, believes that the assets should be used instead to underpin a loan to Ukraine, which is set to run out of money early next year. “I cannot see any scenario in which the European taxpayers alone will pay the bill,” von der Leyen told lawmakers. Over the past few days, several EU diplomats said that von der Leyen ordered her officials to present a draft legal text on the reparations loan within days as momentum grows for a solution. “If we don’t move, others will move before us,” said one EU official, granted anonymity to speak freely.  But despite intensive talks between Belgium and the Commission in recent weeks, De Wever still has concerns about legal liabilities and the risk of retaliation from Moscow if the Russian funds were used for the loan. 

BRUSSELS — European countries are working on an emergency plan B to stop Ukraine running out of money early next year in case they cannot reach a deal on raiding Russia’s frozen assets to fund Kyiv’s war effort.  At a summit a month ago European Union leaders hoped to agree on a proposal to use Moscow’s immobilized reserves for a €140 billion “reparations loan” to Ukraine but the idea ran into fierce opposition from Bart De Wever, the prime minister of Belgium, where the money is held.  Now, with peace talks intensifying, and Kyiv running short of cash, the question of what to do with the Russian assets has taken on a new urgency. “If we don’t move, others will move before us,” said one EU official, granted anonymity like others cited here, to speak freely.  European officials suggested Donald Trump’s new peace drive could help solidify support for the plan to use the frozen funds for a reparations loan. The cash would only become repayable to Moscow in the unlikely future scenario that Russia agrees to pay war damages, under the plan. EU diplomats expect European Commission President Ursula von der Leyen to order her officials to present a draft legal text on the reparations loan within days as momentum grows for a solution. But despite intensive talks between Belgium and Commission in recent weeks, De Wever still has concerns about legal liabilities and the risk of retaliation from Moscow if the Russian funds were used for the loan.  So policy specialists in Brussels are now turning to how to help Ukraine in the event that the reparations loan proposal does not come together in time for EU leaders to sign off on it at a summit on Dec. 18.  One option gaining support is for a “bridging” loan, financed by EU borrowing, to keep Ukraine afloat during the first months of 2026, according to four officials. That would allow more time to set up the full reparations loan using the Russian assets in a way that Belgium can live with, to provide a longer term solution.  Two diplomats said Ukraine could be asked to repay the initial bridging loan to the EU, once it has received funding from the long-term reparations loan. French President Emmanuel Macron said EU allies will finalize “in the coming days” a solution that will “secure funding” and “give visibility to Ukraine.” | Sean Gallup/Getty Images EU countries’ envoys discussed options with the European Commission at a meeting in Brussels on Tuesday. Countries including France, Germany, the Netherlands, Lithuania and Luxembourg all pushed the Commission to keep working on proposals to finance Ukraine, according to one official briefed on the discussion. The prospect of a bridge financing model had been raised on Nov. 4 by EU Economy Commissioner Valdis Dombrovskis, who noted: “The longer we now run delays, the more challenging it will become.” URGENCY The Commission is acutely aware of the need to get a solution in place urgently, with Kyiv warning it faces running out of money in the first few months of next year.  On Tuesday, French President Emmanuel Macron said EU allies will finalize “in the coming days” a solution that will “secure funding” and “give visibility to Ukraine.” In the longer term, the reparations loan is widely seen as the only game in town. There is no appetite among EU member countries to dip into their own national budgets to send cash grants to Ukraine. Many are already struggling with budget deficits and high borrowing costs. Persuading the Belgians to come on board ultimately is therefore seen as key.  “We hope to be able to solve their hesitation,” one EU diplomat said. “We really do not see any other possible option than the reparations loan.” One idea would be to “combine the reparations loan option with one of the other options” the diplomat said. But this must “not take too much time because of course there’s a sense of urgency now and it’s pressing.”  There are still problems with creating a bridging loan using joint EU borrowing, which some commentators have described as “eurobonds” though others dislike the term.  Perhaps the biggest obstacle will be that this kind of EU borrowing would require unanimous support from the bloc’s 27 member countries and Hungary has long opposed new measures to help finance Ukraine’s war effort.  It is possible, however, that casting the bridging loan as designed for Ukraine’s reconstruction, rather than for funding its war machine, would help.  Another factor will be the renewed momentum for a peace deal as Trump’s team seeks to push officials from Ukraine and Russia closer to agreeing terms. The evolving drafts of a peace proposal refer to using the frozen assets to fund Ukraine’s reconstruction. European officials reacted with dismay last week to the idea contained in the original American draft for the U.S. to profit from the use of these assets.  EU leaders are now hopeful that they have convinced Trump’s team that they must have the final say over what happens to these assets, as well as over the timing of European sanctions on Russia being lifted and on Ukraine’s path toward membership of the EU, diplomats said.  Clea Caulcutt and Esther Webber contributed reporting. This article has been updated.

LONDON — Voters across the Western world are alarmed about threats to democracy, worrying that extremist parties, fake news and corruption will undermine elections.  A major poll by Ipsos of almost 10,000 voters in nine countries — seven in the European Union, plus the U.K. and the U.S. — found about half of voters are dissatisfied with the way democracy is working.  With the exception of Sweden, where people think democratic politics is working well, a clear majority worry about the risks to their systems of self-government over the next five years, according to the survey shared exclusively with POLITICO.  “There’s widespread concern about the way democracy is working, with people feeling unrepresented particularly by their national governments,” Gideon Skinner, senior director of U.K. politics at Ipsos, told POLITICO. “[There are] particular concerns around the impact of fake news, disinformation, lack of accountability for politicians, and extremism. In most countries there is a desire for radical change.”  The survey comes amid growing concern that democracy across the West is under threat. Wealth inequality around the world is driving support for extremist parties, undermining debate and preparing the ground for authoritarianism, according to a recent report for the G20. This week, the European Commission unveiled its plans to strengthen democracy across the EU’s 27 countries. But critics said its proposal to tackle foreign interference in European elections was too weak, with participation voluntary across the bloc. Authorities have identified Russian disinformation and meddling in elections in many European countries over the past year, from Romania to Germany.  For the new poll, Ipsos questioned more than 9,800 voters in the U.K., France, the U.S., Spain, Italy, Sweden, Croatia, the Netherlands and Poland between Sept. 12 and Sept. 29. The pollsters found an average of 45 percent of respondents across all nine countries examined were dissatisfied with the way democracy was working, Skinner said.  Voters who identified as belonging to the political extremes — both on the far left and far right — were most likely to say democracy was failing.  In France and the Netherlands, satisfaction levels have fallen over the past year in response to political turmoil. The French government has repeatedly collapsed amid an ongoing crisis over the national budget, while the Dutch coalition fell apart earlier this year, triggering an election that was held in October. In none of the nine countries surveyed did a majority of voters believe their national government was representing their views well. Voters in Croatia and the U.K. were the least likely to agree that their governments were representing them effectively, with just 23 percent saying so in both cases.  In every country surveyed apart from Poland — which saw a high turnout in presidential elections this year — more voters said the way democracy was working had worsened over the past five years than said it had improved. In the U.S. 61 percent of voters thought the state of democracy had worsened since 2020.  Voters in France (86 percent) and Spain (80 percent) were the most worried about what the next five years would mean for their democratic systems. Respondents identified the biggest risks to democracy as disinformation, corruption, a lack of accountability for politicians and the rise of extremist politics.    Generally, most people questioned still strongly supported democratic ideals, though in Croatia more than half (51 percent) said keeping democracy was only worth it if it delivered a good quality of life.  Ipsos found that respondents backed action to protect democracy, especially laws and enforcement to combat corruption, protecting the independence of the courts, better civic education in schools, and regulations against fake news and hate speech on social media.

Czechia — one of Ukraine’s staunchest allies — is considering cutting the flow of much-needed arms and ammunition to Kyiv’s forces when its new government takes control in the coming weeks, according to a key leader of the incoming coalition. Filip Turek, the president of the right-wing populist Motorists party that this week signed an agreement to help form a national government, said that his country will “maintain NATO commitments and adherence to international law.” However, he went on, “it will prioritize diplomatic efforts to end the war in Ukraine and mitigate risks of conflict in Europe, shifting from military aid funded by the national budget to humanitarian support and focusing on Czech security needs.” The Motorists party was founded in 2022, and clinched six seats in parliament during last month’s nationwide election, making it a pivotal kingmaker in efforts by prime minister-designate Andrej Babiš and his populist ANO faction to form a government. Turek is under consideration to take on the role of foreign minister in the new administration. Babiš has previously publicly cast doubt on the future of a major program led by the current Czech government to provide tens of thousands of artillery shells to Ukraine, but has avoided publicly committing to a position since the election. Responding to the comments, first reported in POLITICO’s Brussels Playbook, outgoing Czech Foreign Minister Jan Lipavský said, “the limitation of Czech military aid to Ukraine is news that will surely bring great joy to Russian soldiers on the front line. Let’s consider it a Christmas gift from Babiš to Vladimir Putin.” According to Lipavský, whose broad center-right platform suffered defeat in October’s election, the new coalition’s policy statements “do not mention the word Russia even once,” and fail to face up to the Kremlin’s aggression. “The new government will be undermining the security of the Czech Republic,” Lipavský said. Turek added that the new Czech government would deal with Moscow in a manner “guided by pragmatic protection of national interests” and avoid “escalation that could endanger Czechia’s energy security or economic stability.” A “broader focus on sovereignty and non-intervention suggests a cautious, interest-based approach,” he said. While the Czech government may change the types of aid it provides to Ukraine, the EU’s main plan to finance Kyiv next year hinges on the use of Russian frozen assets currently held in Belgium. Brussels is in the process of deciding whether to support those measures, and it’s unclear whether Prague would oppose such a move. Babiš, tasked with forming a government within the next month, may face opposition from President Petr Pavel over Turek’s nomination. The likely next foreign minister has faced police investigation over inflammatory social media posts, some of which he has apologized for and others of which he has denied authorship. EU STANCE At the same time, Turek said Prague would prioritize being “a sovereign, confident member of the EU and a firm ally in NATO,” but simultaneously “resist further transfers of powers to Brussels and advocate for a union based on unanimity, mutual respect, and pragmatic policies that avoid overburdening citizens with regulations.” The former racing car driver, who until last month served as a member of the European Parliament and campaigned on an anti-Green Deal platform, branded eco-conscious policies “unsustainable,” calling for a reversal of the 2035 ban on the sale of cars with combustion engines and for emissions trading systems to be dropped altogether. “Real change requires Brussels to prioritize factory floors and family budgets over ideological agendas that only accelerate the offshoring of sophisticated European production to China,” Turek said, “where less efficient plants and long-distance shipping generate higher global emissions, paradoxically contradicting the very climate objectives Brussels claims to pursue.” Babiš will have to present his proposed list of ministers to Czech President Petr Pavel in the coming days before a vote of confidence in the new government can be held.