The billionaire paradox
Rebecca Christie is a Bruegel Senior Fellow
Are American tech billionaires adversaries or role models for Europe? The companies that enriched them are embedded in the European Union’s economy as suppliers, employers, customers and investors (some are also Bruegel members). Yet exorbitant wealth gives tycoons an extra sway, given their global reach and their increasingly intertwined relationships with the White House and the political system in the United States.
It seems preposterous that any individual requires as much wealth as some tycoons have amassed. Yet there are clear benefits to the economic dynamism that has fuelled their ascent. Policymakers now must figure out how to court them, tax them and regulate them.
On the plus side, tech billionaires come from a culture of growth, investment and optimism –more often realised in the US – that has led to big advances in communications and artificial intelligence. Their deep pockets offer lifelines to European firms looking to scale up. Their presence as individual investors lifts stock markets alongside the thriving equity prices of the companies they manage.
On the minus side, their political influence can run counter to a democratic society, and their huge wealth gives them worldwide reach. The Trump administration is openly offering more power to those with the money to pay.
Overt links between Washington and the wealthiest business leaders, and business more broadly in the context of the administration’s activities enriching Donald Trump’s personal fortunes, have spooked US allies and trading partners. As with China, which according to the European Commission is simultaneously a partner, competitor and strategic rival, there is no alternative to working together closely.
Additionally, the EU has great need of the innovation, productivity and investment habits practiced by US tech giants, including their rich and sometimes politically active top executives.
If the EU wants tech titans to resist Trump-era self-dealing, does it make more sense to work closely with them or to maintain a wary distance? How should rich people working or living in the EU pay their fair shares? Not so long ago, Silicon Valley embraced efforts to combat climate change and promote diversity, two issues now at the opposite end of the US political cycle. This illustrates how wealthy tech leaders stay relevant, whether or not their motives align with other policy preferences.
Open and frank discussions are necessary about where billionaires are political adversaries and where they serve as examples to emulate. To choose which risks to take, the EU must be clear eyed about where things stand
Addressing the billionaire paradox means confronting the EU’s attitude toward risk, both positive and negative. Many Europeans reflexively see risk as a threat to their values and lifestyle. Yet when it comes to finance, policymakers are actively seeking ways to look past the safe bet.
As it stands, long-term investing in Europe is channelled into insurance contracts and savings bonds, with capped potential. Higher return, higher growth investments require instruments like equity and venture capital, where the winners hit big but the rest may lose it all.
Differentiating between the worthwhile risk and the throwaway punt is hard if you’ve always viewed uncertainty on a single sliding scale, where less is good and more is bad. But forward-looking investment will be essential for the EU to find the growth it needs. That will require not just studying choices but embracing some of the open-ended options.
Tax policy presents another opportunity and challenge for Europe’s policy apparatus. An April 2026 European Commission study on wealth taxation found that countries have so far struggled with whether and how to tax the holdings of high net-worth individuals – as well as more standard levies on their income, profits and real estate.
Spain is the only EU country with an active wealth tax, while Germany and Sweden have abandoned theirs. Such efforts seem to work best when targeting only the richest individuals, but such narrowly targeted efforts also bring their own political trade-offs.
If Europe needs investment, does it make sense to penalise foreigners with deep pockets? Should the EU grow more of its own tech billionaires? Can it extend more influence over the global richest through the strength of its single market and high living standards? How can the EU encourage a more dynamic economy while resisting inequality and social injustice and also the undue influence of concentrated private-sector money?
Tempered optimism and a commitment to long-term values are hallmarks of effective policymaking, and of the EU’s winding but steady march forward. There are no easy answers, and once again the EU will need to muddle through until it finds its way. Open and frank discussions are necessary about where billionaires are political adversaries and where they serve as examples to emulate. To choose which risks to take, the EU must be clear eyed about where things stand.
This article is based on a Bruegel First Glance.
