ISSUE BRIEF
No. 4576 | June 15, 2016
NATO Summit 2016:
Alliance Members Must Commit to Increased Defense Spending
Daniel Kochis and Luke Coffey
T
he 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,
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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

ISSUE BRIEF | NO. 4576
June 15, 2016
CHART 1
Many NATO Countries Spend
Less on Defense than the New
York Police Department
DEFENSE SPENDING, IN MILLIONS OF 2014 DOLLARS
$654,264
$65,827 United Kingdom
$52,006 France
$46,102 Germany
$24,448 Italy
$18,150 Canada
United
States
$13,686
$12,614
$10,332
$10,104
$7,336
$5,226
$5,192
$4,756
$4,056
$2,990
$2,692
$1,974
$1,205
$997
$805
$747
$513
$486
$427
$293
$257
$184
Turkey
Spain
Netherlands
Poland
Norway
Greece
Belgium
NYPD
Denmark
Portugal
Romania
Czech Republic
Hungary
Slovak Republic
Croatia
Bulgaria
Estonia
Slovenia
Lithuania
Latvia
Luxembourg
Albania
SOURCES: North Atlantic Treaty Organization, “Defense
Expenditures Data for 2014 and Estimates for 2015,” June 24,
2015, http://www.nato.int/cps/en/natohq/news_120866.htm
(accessed June 14, 2016), and Council of the City of New
York, “Report on the Fiscal Year 2015 Executive Budget for
the Police Department,” May 20, 2015,http://council.nyc.gov/
downloads/pdf/budget/2015/15/eb/police.pdf (accessed
June 14, 2016).
IB 4576
heritage.org
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:
nn
nn
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
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ISSUE BRIEF | NO. 4576
June 15, 2016
on the importance of military investment might
help secure more defense spending in the long term.
nn
nn
nn
nn
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.
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 Conclusion
must make a clear case that the U.S. remain in
The reality is that there is very little that the U.S.
Europe and a leader inside the alliance because it can say or do to force Europeans to spend more on
is in the national interest to do so.
defense, especially at a time when America is cutting
its own budget. Remaining silent on the matter offers
Press allies on defense spending. President implicit approval, however. Weak defense spending
Obama should address this directly with his Euro- by European NATO members threatens to underpean counterparts leading up to and during the mine the collective security guarantee and play
NATO summit. European leaders should not take into Putin’s hands. The Warsaw summit is a vital
public support for NATO membership for granted. time for NATO members to recommit themselves
Instead, governments should strongly and con- to their treaty obligations under the North Atlantic
sistently make the case for NATO and the impor- Treaty, and to meet the challenge of Russian aggrestance of robust defense spending.
sion head on with real capabilities, providing lasting
deterrence.
Encourage European allies to make the case
—Daniel Kochis is a Research Associate in the
to their citizenries. Many people do not under- Margaret Thatcher Center for Freedom, of the
stand how NATO is still relevant today. Since Kathryn and Shelby Cullom Davis Institute for
2009, public support for NATO has declined in National Security and Foreign Policy, at The Heritage
many European nations, including France, Ger- Foundation. Luke Coffey is Director of the Douglas
many, Spain, and the U.K.8 This unhealthy trend and Sarah Allison Center for Foreign Policy, of the
must be stopped.
Davis Institute.
http://www.pewglobal.org/2015/06/10/1-nato-public-opinion-wary-of-russia-leary-of-action-on-ukraine/ (accessed June 10, 2016).
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ISSUE BRIEF | NO. 4576
June 15, 2016

Endnotes
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-posturestatement-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,
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