The Heritage Foundation

Issue Brief #4576 on Alliances

June 15, 2016

June 15, 2016 | Issue Brief on Alliances

NATO Summit 2016: Alliance Members Must Commit to Increased Defense Spending

The July NATO summit in Warsaw, Poland, offers an opportunity for the alliance to build on commitments of the 2014 summit in Wales regarding defense spending and increased military capability. As an ally that has prioritized defense spending, Poland is a fitting host for the 2016 NATO summit. The U.S. should reverse its own defense cuts and find creative ways to press its allies to invest more in defense.

A Treaty Obligation

Although most followers of NATO are familiar with Article 5 of the North Atlantic Treaty—an attack on one is an attack on all—Article 3 of the treaty is most important when it comes to the overall health of the alliance. Article 3 states that member states, at a minimum, will “maintain and develop their individual and collective capacity to resist armed attack.”[1] Only a handful of NATO members can say that they are living up to their Article 3 commitment.

Since the end of the Cold War, many European nations have—until very recently—consistently cut defense spending, resulting in a loss of significant capability. NATO members are, at a minimum, treaty-obligated to spend adequately on defense.

In 2015 (the date for which the most recent NATO figures are available), only five of 28 NATO member states—Estonia, Greece, Poland, the United States, and the United Kingdom—spent the required 2 percent of gross domestic product (GDP) on defense.

On a positive note, since the Wales summit in 2014, the annual real-terms change in NATO total defense expenditures showed a move in the right direction. In 2016, the annual real change for Canada and European NATO members is estimated at 1.5 percent, a $3 billion increase.[2] When cuts have occurred, they have been significantly less than in recent years. In 2015, 19 NATO members stopped cuts to defense spending, 16 of those 19 also increased their defense spending in real terms.[3]

While some European nations have halted defense spending cuts and put in place long-term plans for increases, a lack of investment in defense remains a serious challenge in Europe. In 2015, the U.S alone accounted for 72.2 percent of NATO defense expenditures.[4] New York City spends more on policing than 13 NATO members each do on their national defense. In the long term, with the challenges and threats faced by the alliance, this is not a sustainable level.

General Philip Breedlove, former NATO Supreme Allied Commander in February stated that Article 3 “reminds us that defense begins at home, that all members must contribute to collective defense, and that each nation has a responsibility to maintain their capability for their own defense.”[5]

Defense Is Not Cheap

As an intergovernmental security alliance, NATO is only as strong as its member states. Weak defense spending on the continent has led to a loss of significant capabilities in the alliance. European countries collectively have more than 2 million men and women in uniform, yet by some estimates only 100,000 of them—a mere 5 percent—have the capability to deploy outside national borders.[6]

NATO reiterated the benchmark of members spending 2 percent of GDP on defense, and 20 percent of defense budgets on major equipment and research and development. Reaching this benchmark and maintaining it is an obligation for NATO members and requires a political, economic, and societal decision to invest in defense. Poland, the host of this year’s summit has made that decision, and as such has set a good example for other NATO member states. In 2015, Poland spent 2.18 percent of GDP on defense, and 31 percent of defense budgets on equipment.[7] While other NATO members, such as the Baltics, which share a border with Russia, recognize the importance of defense investment and have prioritized defense spending, many nations in the alliance continue to lag behind.

NATO has provided peace and stability for its member states since its inception in 1949. This was achieved because the countries of the security alliance had real military capabilities that they could leverage in defense of other member states. NATO should continue its return to its mission of collective security in Warsaw by each member state prioritizing defense spending in support of collective defense.

 

Actions for the Warsaw Summit

A strong commitment to increased defense spending at the Warsaw summit will send a clear message to Russian President Vladimir Putin that NATO is strong and committed to its collective security guarantee. In order to encourage NATO members to live up to their Article 3 obligations the U.S. must:

  • Lead by example. The U.S. military budget has been cut by 25 percent in the past five years in inflation-adjusted dollars. Budget cuts have had a deleterious impact on readiness and the U.S. military’s ability to fight and win wars. Many Europeans use defense cuts in the U.S. as justification for their own cuts. The U.S. should lead by example in the alliance and reverse defense budget cuts.
  • Get finance ministers involved. There should be a special session for finance ministers (or their equivalent) at the Warsaw summit. In many parliamentary democracies, the finance minister controls public spending. Educating the finance ministers on the importance of military investment might help secure more defense spending in the long term.
  • Reiterate America’s commitment to Europe. U.S. leaders should reiterate that it is in America’s best interests to remain actively engaged in NATO. A peaceful, stable Europe has led to economic, cultural, and military dividends that are magnitudes more than the U.S. spends on military personnel and basing on the continent. American leaders must make a clear case that the U.S. remain in Europe and a leader inside the alliance because it is in the national interest to do so.
  • Press allies on defense spending. President Obama should address this directly with his European counterparts leading up to and during the NATO summit. European leaders should not take public support for NATO membership for granted. Instead, governments should strongly and consistently make the case for NATO and the importance of robust defense spending.
  • Encourage European allies to make the case to their citizenries. Many people do not understand how NATO is still relevant today. Since 2009, public support for NATO has declined in many European nations, including France, Germany, Spain, and the U.K.[8] This unhealthy trend must be stopped.
  • Set a concrete timeline for achieving NATO benchmarks. While many member states make vague promises about attaining the 2 percent of GDP benchmark in the future, few have followed through. The U.S. should encourage NATO members to embed defense spending commitments and timelines in legislation. This will help to increase transparency and political accountability.

Conclusion

The reality is that there is very little that the U.S. can say or do to force Europeans to spend more on defense, especially at a time when America is cutting its own budget. Remaining silent on the matter offers implicit approval, however. Weak defense spending by European NATO members threatens to undermine the collective security guarantee and play into Putin’s hands. The Warsaw summit is a vital time for NATO members to recommit themselves to their treaty obligations under the North Atlantic Treaty, and to meet the challenge of Russian aggression head on with real capabilities, providing lasting deterrence.

—Daniel Kochis is a Research Associate in the Margaret Thatcher Center for Freedom, of the Kathryn and Shelby Cullom Davis Institute for National Security and Foreign Policy, at The Heritage Foundation. Luke Coffey is Director of the Douglas and Sarah Allison Center for Foreign Policy, of the Davis Institute.

About the Author

Daniel Kochis Policy Analyst in European Affairs
The Margaret Thatcher Center for Freedom

Luke Coffey Director, Douglas and Sarah Allison Center for Foreign Policy
Douglas and Sarah Allison Center for Foreign and National Security Policy

Show references in this report

[1] North Atlantic Treaty Organization, North Atlantic Treaty, Washington, DC, April 4, 1949, last updated December 9, 2008, http://www.nato.int/cps/en/SID-857936BB-66246E10/natolive/official_texts_17120.htm (accessed June 10, 2016).

[2] News release, “NATO Defence Ministers to Pave the Way for Decisions at the Warsaw Summit,” North Atlantic Treaty Organization, June 13, 2016, http://www.nato.int/cps/en/natolive/news_132275.htm?selectedLocale=en (accessed June 13, 2016).

[3] North Atlantic Treaty Organization, The Secretary General’s Annual Report 2015, January 2016, p. 27, http://www.nato.int/nato_static_fl2014/assets/pdf/pdf_2016_01/20160128_SG_AnnualReport_2015_en.pdf#page=27 (accessed June 10, 2016).

[4] Ibid., p. 26.

[5] General Philip Breedlove, “U.S. European Command Posture Statement 2016,” testimony before the Committee on Armed Services, U.S. House of Representatives, February 25, 2016, http://www.eucom.mil/media-library/article/35164/u-s-european-command-posture-statement-2016 (accessed June 10, 2016).

[6] Nick Witney, “Re-Energising Europe’s Security and Defence Policy,” European Council on Foreign Relations, July 2008, p. 20, http://www.elpais.com/elpaismedia/diario/media/200807/29/internacional/20080729elpepiint_2_Pes_PDF.pdf (accessed March 18, 2015).

[7] News release, “Defence Expenditures of NATO Countries (2008–2015),” Public Policy Division, North Atlantic Treaty Organization, January 28, 2016, pp. 6 and 9, http://www.nato.int/nato_static_fl2014/assets/pdf/pdf_2016_01/20160129_160128-pr-2016-11-eng.pdf (accessed June 10, 2016).

[8] Katie Simmons, Bruce Stokes, and Jacob Poushter, “NATO Publics Blame Russia for Ukrainian Crisis, But Reluctant to Provide Military Aid: In Russia, Anti-Western Views and Support for Putin Surge,” Pew Research Center, June 10, 2015, p. 18, http://www.pewglobal.org/2015/06/10/1-nato-public-opinion-wary-of-russia-leary-of-action-on-ukraine/ (accessed June 10, 2016).