Trump's NATO push: Europe's defense budget dilemma
Donald Trump is demanding that European NATO countries increase their defence spending. His actions may prove effective because Europe slowly realizes there is no other way for its own security.
Donald Trump will return to the White House in a few days, but his policy regarding NATO has been known for quite some time. During his previous presidency, he urged member countries to spend 2% of their GDP on defence and later suggested raising this threshold to even 4%.
In December, the "Financial Times" reported that this time Trump plans to demand member countries increase spending to as high as 5% of GDP. Most commonly, however, it's said that he would settle for 3.5%.
If there is something to criticize about Trump, it's that in demanding increased military spending, he likely doesn't fully understand how allies' budgets work. This primarily concerns the structure of expenditures. While the United States spends 3.38% of its GDP on the military, slightly more than 2% goes towards armaments. This occurs because healthcare for soldiers and veterans is included in this budget. In contrast, in European countries and Canada, military healthcare is accounted for in ministries responsible for healthcare, not the military budget.
Thus, even if funding rules were equalized, Washington would have trouble meeting its president's requirements, much like Germany, which until recently did not meet the requirements for allocating 2% of its GDP to armaments. Germany was just €17 billion short, even though they exceeded the required threshold. The issue was that a special fund of €100 billion, intended solely for technical modernization, was not included in the defence ministry's budget. Similarly, healthcare and pension insurance were not included either.
Contrary to Trump's concerns, European NATO members are increasing their defence spending. The European Union's common programs - the European Security Strategy or the European Defence Industrial Strategy - assist with this. Their financing also translates into increased European investment in security.
The East is the leader
The leaders in defence spending among European NATO members are the countries on the eastern flank, with Poland being the undisputed leader. According to a NATO report, in 2024, Polish spending was 4.12% of GDP. Estonia came second with 3.43%, and Latvia rounded out the top three with 3.15% of GDP.
It looks a bit different in terms of real expenditures. Germany spends the most on the military, followed by the United Kingdom and France, which slightly exceed the 2% threshold. Poland is only fourth, although it allocates twice as much of its GDP to armaments.
Countries that vividly remember Soviet occupation and value regained freedom and invested in security. One might get the impression that after the collapse of the USSR, the old NATO countries rested on their laurels and began to relax. It's also true that the further one gets from the Russian Federation and Belarus borders, the less spending there is. Nine countries, including Spain, Portugal, and Italy, did not exceed the two-percent threshold.
- The further from Russia, the poorer the social awareness of what the Russian regime is, and that you simply can't come to terms with Russia. In such countries, support for defence spending will be lower, and the perception of threats different — notes Dr. Michał Piekarski, an international security specialist from the University of Wrocław.
The new NATO Secretary-General, Mark Rutte, is also urging an increase in defence spending.
- Today, I call for your support; action is urgent. To protect our freedom, our prosperity and our way of life, your politicians need to listen to your voices. Tell them you accept to make sacrifices today so that we can stay safe tomorrow — Rutte said during a December appearance at the Concert Noble in Brussels.
The Dutchman also called for cuts in social spending, which he considers too large. He noted that the existing goal of allocating 2% of GDP to defence is insufficient and urged NATO member countries to adopt a "war mentality" to counter contemporary challenges more effectively.
The question is, will Europeans sacrifice social conveniences to build up the military? In societies, awareness of the need to have armed forces and modernize them is low and only temporarily increases during natural disasters.
Observing the reactions of European public opinion, there is fatigue with war rhetoric, notes Jakub Link-Lenczowski, editor of the Military Magazine MilMag. Cognitive dissonance occurs if people have been frightened for years by an impending armed conflict while grappling with the high price of butter and the Green Deal. What might change attitudes are Russia's increasingly bold hybrid actions. Although they are below the threshold of war, they directly and painfully affect individual societies in Europe.
The biggest challenge is gaining public support to begin modernizing European armies. Most politicians pay attention to the polls, and issues of long-term international security are postponed. Meanwhile, the European defence industry is a sleeping giant.
Sleeping power
Europe is home to some of the largest armament factories in the world, but many of them have been closed, or production has been limited. In essence, the European industry has lost the capability for large-scale production of ammunition, artillery systems, and tanks. For instance, the United Kingdom dismantled its Royal Ordnance Factory tank factories in Leeds and Elswick in Newcastle upon Tyne, where Challenger tanks were made.
Although large capacities remain, production has been significantly reduced in other countries. The French have a conserved tank production line at Atelier de Construction de Roanne, but restarting production would also cost too much for small-scale production to be profitable.
- The European defence industry has a very large potential, as noted by Link-Lenczowski. - It meets most of the characteristics typical of developed countries. It has the capability to produce engines for vehicles and ships, as well as the most advanced jet and rocket engines.
- Europeans produce satellite systems, develop modern tanks, and work on a new generation of combat aircraft. The problem is the scale of these activities. However, to change this requires difficult decisions in politics and economics — adds the expert.
The decision to implement the European Defence Industrial Strategy has been an important step so far. The document sets goals for the defence industry until 2035. It aims to help meet the goal set in 2007, which assumed that 33% of the equipment would be produced by Union countries. Currently, this figure is only 18%.
The current assumptions are that as much as 50% of defence spending will go to the European industry, and 40% of new products will come from cooperation between Union countries. This will significantly strengthen the domestic defence industry and make it competitive globally.
Europe has enough time to start arming and adapting its armies to changing conditions. Russian involvement in Ukraine is so significant that the Kremlin currently lacks the capability to conduct another conflict. This will certainly change over time. Therefore, the problem lies in convincing citizens that increasing defence spending is necessary.
