Or perhaps we can call it a polite fiction. What am I talking about? Today, the leaders of NATO countries met and agreed to .... very little. It is probably the shortest communique in history (see 2023 and 2024 for typical end of summit agreements/commitments). They agreed to new spending targets and not much else. No Ukraine, no China, no southern front (how to prevent immigrants from going to Italy, Greece, Spain, Portugal), no nothing else.
And this drives me crazy. Before I get to the Big Lie, let me explain why I hate this 2% and now 3.5% madness. NATO does not exist to nag members to spend more on their defense, NATO exists to provide security for those in the North Atlantic community (broadly defined). The 32 members are supposed to work on a variety of security issues, to create greater certainty, to deter Russia and other adversaries, and to reassure the allies. This involves a lot of issues and lot of challenges. These summits are like academic conferences--we academics need artificial deadlines to write our papers and leaders need these meetings to force them to reach agreement on tricky negotiations. That all they got was "historic" commitments to spend more money represents a huge lost opportunity.
The other problem is that % of GDP spent on defense tells us ... that a country spent money, it is an input measure, so we don't know if they spent it well, or whether the country will use those funds to develop capabilities that would help the alliance. Greece always did well in this measure despite spending mostly on troops aiming their rifles at Turkiye. Not helping the alliance much especially as Greece never showed up when the alliance needed help. It is a lousy measure, but it is easy to understand. It might mean a bit more in the next few years for reasons I suggest below.
But this is life in the Trump era where this summit is a huge success because the alliance still exists. Woot? So, maybe we should be happy? Depends on what you want out of an alliance.
Sure, the first clause of the communique refers to the iron clad commitment of Article V--that each country will respond (as each deems necessary, see the Dave and Steve book) to an attack on any one. Let's not be too reassured by this since Trump is, well, almost as much as a threat to members as Putin is--given the threats he has made towards Greenland and Canada. Plus Trump raised doubts about what he thinks A5 means on his flight over. I am sure I have missed some utterance of his over the course of this day that undermines this "ironclad" commitment.
Moving on to the big news 5%. Wow! Except it is not five percent but 3.5% plus 1.5%. That is, the countries promise to move from the 2% promise to spending 3.5% of their GDP on defense stuff--planes, ships, tanks, other war material, pay for soldiers, sailors, aviators,etc. What we usually think of as defense spending. The 1.5% is spending on stuff that is "defense-related" which can mean pretty much anything--it is pretty elastic. So, Germany can spend money on infrastructure--roads, ports, railroads, etc that benefit their citizens and that also help the transport of British, French, American, etc tanks, artillery, personnel to the front in the east. For Canada, this might mean spending on northern ports and infrastructure, subsidies for mining rare earth metals, and other stuff that Mark Carney wants to do and they can call it defense stuff. So, don't freak out at the 5%. Freak out at the 3.5% instead as that would move Canada from spending $60b per year to $150b per year by 2035. Yowza. I doubt that Canada will get there (unless the economy tanks as the metric is defense spending/GDP). But Canada will move in that direction.
Are countries doing this to placate Trump? The change in the math to 5%? Yeah. The 3.5%? Perhaps not so much. The 2% standard was set after Crimea. The war in Ukraine since 2022 has taught NATO countires that 2% is not nearly enough--we all need drones, anti-drone tech, anti-air and anti-missile defenses, heaps and heaps of ammunition of all kinds, and a lot more. So, the standard was going to shift and should shift (as much as I hate the idea of setting a % input standard). Why 3.5% and not 3? Well, part of it may be that the Baltics, Poland, and some others were already at 3% or beyond so they want the rest of NATO to catch up. Part of it is appealing to Trump AND part of it is figuring out how to build militaries that can operate if the Americans stay home. Europe and Canada have to develop the capacity to fight if the US ops out.
Because no one can count on Trump to show up in a crisis, and no one knows what the next Republican will be like, but the Euros didn't like that unilateral Bush that much either.
One more thing--the additional spending on defence is .... not going to fund American defense contractors. That may be what Trump expects, but everyone wants a heap of strategic autonomy from the unreliable Americans. Carney has talked much about how buying 75% of defense stuff from the US is not right. Monday, he signed a deal with the EU as part of an effort to buy more European defense stuff. Will this tilt the sub purchase towards Germany/Norway and away from South Korea? No idea. But expect other stuff to be made in Europe and then perhaps assembled or something in Canada.
I am a bit buzzed right now since I have had half dozen media interactions today--lots of concern, confusion, consternation about the big announcement. Again, the key is this: it is a massive increase in defense spending--to 3.5% of GDP. The extra 1.5% is just justification for other spending priorities in most cases.
Let me know if you have questions or additional info.