But cracks are forming in the north’s united front. War at Europe’s borders, economic shifts, and a United States president eyeing a retreat from NATO have forced a rethink — and the frugal alliance is wobbling just as the EU prepares for its next big budget showdown.
In the past, these frugal countries developed a “closely knit, well-prepared strategy to stop ideas that had to do with more spending,” an EU government official with experience overseeing several budget talks told POLITICO.
But the upcoming negotiations on the 2028-2034 budget promise to be “completely different,” according to the official, who like others quoted in this story was granted anonymity as they are not allowed to speak on the record.
“A group of Nordic and Baltic countries [is] developing a different vision focused on the security issue that distinguishes them from the other frugals like Holland and Austria,” Eulalia Rubio, an analyst from the Jacques Delors Institute think tank, told POLITICO.
Sovereignty has become the new rallying cry, and even staunch fiscal hawks like Denmark or Finland are warming to the idea of loosening the purse strings to bolster the EU’s collective defense and resilience against external threats.
Why Denmark flipped
A pivotal sign of this shift came during Danish Prime Minister Mette Frederiksen’s New Year’s speech, when she stunned EU budget veterans by advocating more defense spending, state aid and investment in Europe’s sovereignty.
