As the battle between the United States and Israel against Iran continues, predictions of a conflict with exponential risks grow. The consequences of the conflict, however, are very different depending on the social position of those affected. National and European unions must take measures to protect citizens from rising prices and control business margins. The banks, on the other hand, plan to increase profits in 2026, as explained by the president of Santander, Ana Botín.
The unions’ concerns are justified. The starting point is already very fragile for most. The study Live and Work in Europe in 2025prepared by Eurofound, revealed that in 2025, 61% of low-income European households were suffering from financial difficulties, which meant a notable deterioration compared to 2023, when the hardships affected 40%. The impact of cost of living pressures was particularly affecting middle-income households, 30% of which experienced economic strain in 2025, up from 21% in 2022. In contrast, the proportion of high-income households experiencing hardship had remained low and stable at around 9%.
The Union seems incapable of reacting to this reality. Josep Borrell, former head of European diplomacy and president of CIDOB, explained in an extensive interview in Public Agendathe EU’s lack of preparation for current challenges. “The European Union,” he stated, “is not designed for today’s world.” The need to refound the Union has also been raised by Alain Berset, Secretary General of the Council of Europe. An institution not belonging to the EU, but which played a key role in European unification after the war, since its founding congress in The Hague in 1948. The Council of Europe embodies the aspirations of building a democratic Europe, in freedom, under the rule of law and respect for human dignity and rights. The Council has contributed decisive works: the European Court of Human Rights (1959) and the European Social Charter (1961).
Berset has expressed in Social Europe its defense of the Charter and the social rights it promotes. After the drift of the EU, which prioritizes competitiveness, he has warned that “exchanging social rights for economic prosperity does not work in the long term. It has been proven that egalitarian societies are more successful than unequal ones.” In relation to the increase in defense spending, he stated: “It is legitimate, I understand its purpose, but it is not good or sustainable in the long term. Losing or reducing investments in access to health and education is a time bomb.” The EU’s loss of orientation comes from afar. In 1996, in a seminal conference, Jacques Delors asked: “Have we betrayed the European economic and social project?” The architect of the current Union advocated “embodying the values of solidarity, which are the inspiration of the European model.” Solidarity is the recipe against financial precariousness and the antithesis of lower taxes.
