defense spending

Not Just a Question of Money

  • Why it matters

    Why it matters

    The Trump administration is determined to make NATO allies increase defense spending to 2 percent of economic output but Germany and others have little intention of meeting the target.

  • Facts

    Facts

    • Germany currently spends €37 billion annually on defense.
    • Increasing the defense budget to 2 percent of economic output would mean substantially enlarging the armed forces.
    • The Bundeswehr already struggles to recruit and takes years or even decades to procure new combat tanks, transport aircraft or military ships.
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    Audio

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Feierliches Gelöbnis neuer Rekruten
The Bundeswehr struggles to recruit the young people it needs. Source: Picture alliance

Suppose that in the year 2024 Germany were to spend 2 percent of its economic output on defense. We can assume that would mean at least €25 billion – or about $26.7 billion – more than the €37 billion that currently flows into the defense budget.

According to Hans-Peter Bartels, the parliamentary commissioner for the armed forces in the Bundestag, around 1.5 percent would be enough to equip today’s Bundeswehr, Germany’s armed forces, with everything it needs. At 2 percent, the armed forces would have to be substantially enlarged, with far more than the 200,000 soldiers so far planned, more new combat tanks, transport aircraft, military ships or drones.

But where is all that supposed to come from in such a short time? Even today’s Bundeswehr struggles to recruit the young people it needs. Given that generations are shrinking, the only thing that would help would be to reintroduce the draft.

The Bundeswehr needs many years, sometimes decades, to procure new combat tanks, transport aircraft or military ships. It takes at least 18 months just from the time a decision is made on selecting a new multipurpose combat vessel until the contract is awarded.

Germany won’t be able to spend 2 percent of its economic output on defense in 2024. Hardly anyone who knows the Bundeswehr seriously disputes that.

Germany won’t be able to spend 2 percent of its economic output on defense in 2024. At least not in a meaningful way. Hardly anyone who knows the Bundeswehr seriously disputes that.

The problem is how to communicate that to NATO allies – and first and foremost to U.S. President Donald Trump. Particularly since the German government has committed to reaching the 2-percent mark by the middle of the coming decade. Except that it hasn’t. At least, not without considerable ambiguity.

“Allies,” it says in the Wales NATO Summit Declaration, will “aim to move towards the 2-percent guideline within a decade with a view to meeting their NATO Capability Targets and filling NATO’s capability shortfalls.” That this reads so confusingly is not a result of the writers’ inability to formulate a clear sentence. It is the result of bare-knuckled negotiations before and during the summit in September 2014.

Even then, U.S. President Barack Obama wanted to nail down the allies to the 2 percent. And the German government – along with quite a few others – absolutely wanted to avoid being nailed down.

German Foreign Minister Sigmar Gabriel is now primarily quoting the little words “aim” and “move towards” when he argues there is “no apodictic 2 percent goal.” However, that is precisely what the U.S. government is deducing from that sentence from Wales – every member’s commitment to spend 2 percent of its economic output on defense within 10 years.

Secretary of State Rex Tillerson made Washington’s take on it clear on Friday. He demanded the European allies and Canada make concrete plans for the march toward 2 percent – including annual milestones – to be approved by heads of state and government at the NATO Summit in May, and worked out by year’s end. It would be a triumph for President Trump if he could return home with such binding commitments from the allies.

But Chancellor Angela Merkel can scarcely be expected to take this path. The budget is the Bundestag’s business, and parliamentary elections are in September. The center-left Social Democrats vigorously reject spending many more billions on the armed forces, and the Greens and the Left Party are against it. Given the enormous amount of money involved, even Ms. Merkel’s CDU party, and its sister party, the Bavarian Christian Socialists, have a difficult time with the 2 percent target.

Whether a majority can be found in favor of it after the elections is therefore highly uncertain. Finding the necessary two-thirds majority to permanently amend the constitution to provide for the goal, appears virtually impossible.

So what can be done? Ms. Merkel, on the one hand, will have to assure the allies the defense budget will continue to rise – and certainly more sharply than under current plans. She will be able to justify that at home, not because Mr. Trump happens to demand it, but as it being in Germany’s own best interests to have fully operational armed forces in such uncertain times.

And she will have to insist that it isn’t just a question of the money but, more importantly, what the alliance gets for it. The allies have likewise committed to spending the funds more efficiently to strengthen NATO’s military capabilities, such as in air defense, and to participate in joint operations. And that is where Germany will fare considerably better than by only thinking of the money, as NATO Secretary General Jens Stoltenberg has also attested.

The question is whether Mr. Trump can be convinced. The chancellor will have to summon impressive negotiating skills to formulate it in a way acceptable to both sides.

 

To contact the author: hoppe@handelsblatt.com

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