The $30 Billion Bill for Bullying Allies

Trump's Diplomatic Blunders Just Cost America Billions in Defense Deals

Today, I have some compelling evidence to share with you.

The bill for diplomatic incompetence has come due.

This is just the beginning—much more could follow if France recognizes the strategic opportunity before them.

Earlier this month, on September 2, 2025, while analyzing the Trump administration's naive and reckless approach to India policy, I wrote the following:

“Highly likely the Modi government has already initiated high level discussions with France for more Rafale jets — or some other big-ticket military contract.”

Two days ago, the Indian defense ministry began negotiations with France to purchase 114 Rafale fighter jets—a massive $22 billion deal that would establish Dassault Aviation manufacturing operations in India.

I hope France closes this deal immediately. This is exactly the type of strategic partnership Trump should have pursued if he wanted Modi's cooperation. Instead of offering India lucrative defense manufacturing deals that could have drawn Modi closer to American positions, Trump chose intimidation.

The irony is bitter. Modi took the extraordinary step of essentially campaigning for Trump during his first re-election, even adopting the slogan "Ab ki bar Trump Sarkar" (This time, Trump's government). This was highly unusual for Indian leadership—Modi took a significant political risk backing Trump.

Trump squandered it all. The self-proclaimed dealmaker chose bullying over business. Now Modi is systematically reducing American influence by redirecting India's defense spending toward European partners, dealing a direct blow to the American defense industrial complex.

The Rafale platform faces a fundamental disadvantage against the F-35 ecosystem—and the gap is widening, not closing. While Rafale is an excellent 4.5-generation fighter, the F-35 represents a generational leap with low-observable design that sharply reduces radar detectability; Rafale incorporates only limited radar-cross-section reduction features rather than full stealth shaping and materials.

But stealth is just the beginning. Both Rafale and the F-35 can operate on NATO’s standard Link-16 network, meaning they can share tactical information in coalition operations. Rafale is fully interoperable with NATO at this baseline level. The difference is that the F-35 was designed from inception not just as a fighter, but as a networked node. Its dedicated MADL (Multi-Function Advanced Datalink) allows secure, low-detectability communications among F-35s, while its onboard systems automatically fuse radar, infrared, and electronic warfare data into a single picture that can be shared seamlessly with other NATO assets.

Recent NATO training has highlighted this advantage. During Ramstein Flag 2025, Dutch F-35s successfully transmitted real-time targeting data into the new Keystone command system, showing how non-U.S. F-35s can plug directly into NATO-wide C2 networks. Rafale, by contrast, has excellent avionics—including the RBE2 AESA radar and the SPECTRA EW suite—but its level of sensor fusion and automatic data-sharing is more limited. It can exchange data across Link-16, but it was not architected as a “flying server” in the way the F-35 was.

The economics reinforce this divergence. F-35A flyaway cost sits less than $100 million. Rafale unit prices generally run €100-130 million per aircraft.

Scale is decisive: with nearly 1,100 F-35s delivered worldwide by 2025 and steady production targeting 150+ aircraft per year Lockheed Martin benefits from efficiencies Dassault cannot match. Rafale delivered 21 aircraft in 2024 with a current backlog of 220 orders, producing roughly 2 aircraft per month. Smaller volumes keep Rafale relatively more expensive and timelines longer, making it harder to compete head-to-head with the F-35 in major tenders.

This creates a vicious cycle: fewer orders mean higher unit costs and longer schedules, which in turn limit competitiveness. The French state lacks the resources to bankroll Rafale at the scale needed to break this cycle.

The potential Indian MRFA deal for 114 Rafales, however, could alter the trajectory if finalized. Dassault has already ramped from barely one aircraft per month in 2020 to over two today, targeting three per month by 2025 and four by 2028–2029. A joint Indian-European Rafale production line would not only expand capacity but also spread costs across a larger base, giving Rafale a chance to close some of the economic gap with the F-35.

Europe should abandon its plans to build entirely new fighter jet platforms. The India deal proves there's a smarter path forward.

Much of France's struggle stems from its traditional approach to international partnerships—treating allies as mere clients rather than strategic partners. The "my way or highway" mentality has cost France countless opportunities. Instead, France should propose a revolutionary partnership model: an Indian-Rafale program, a European variant, and a French domestic version. Think of it as a modular approach—shared DNA, different brands, tailored specifications, distributed control.

This would give each partner genuine autonomy while achieving the production volumes that have eluded European defense manufacturers.

The strategic timing couldn't be better.

Denmark just delivered the second blow to American defense dominance. After months of deliberation over purchasing the U.S. Patriot long-range air-defense system, Denmark chose differently. They're investing $8 billion in European SAMP/T long range air-defense systems instead—the first major orders for this Patriot rival since the war in Ukraine began. The production lines are about to roar to life.

The Danish Armed Forces are building a ground-based air defence that can protect civilians, military targets and critical infrastructure from threats from the air.

For the long-range system, the Franco-Italian-produced SAMP/T will be procured, while for the medium-range systems, a choice will be made between one or more systems from the Norwegian-produced NASAMS, the German IRIS-T, and the French VL MICA, the Danish Defense Ministry said Friday.

Two nations.

Both targets of Trump's diplomatic heavy-handedness.

Combined result: $30 billion in contracts flowing to France instead of America.

This represents the first crack in the American defense industrial complex's carefully constructed dominance. Water is beginning to leak through the dam that took decades to build.

But France must seize this moment differently than it has in recent years. Trump inadvertently handed them a golden opportunity by repeatedly demonstrating American unreliability to allies. Nations are actively seeking alternatives to U.S. dependence—they want a reliable European shoulder to lean on.

This is Macron's defining moment.

The political and economic boost from these deals could reshape France's position in Europe and globally. But he must treat this $30 billion as merely the opening act. The goal should be $100 billion in European defense contracts within the next two years. The infrastructure, the partnerships, and the political will are finally aligning.

The question is whether France can adapt its approach quickly enough to capitalize on Trump's strategic blunders.

Move Macron Move.

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