Trump, Nato and the four percent solution

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US President Donald Trump took his temper tantrums on the road to Brussels this week. Basically, he is there to scold Nato before he then meets with Russian leader Vladimir Putin in Helsinki and (probably) gives away the store.

His behavior has been sadly predictable. He has fulminated against so-called freeriding allies since the late 1980s. It has been, along with his nativism and racism, some of the few consistent qualities in his political perspective. As he put it at one of his rallies last weekend, the US is the “schmucks paying for the whole thing.”

The “whole thing,” of course, is the defense of the West. In the eyes of Trump – and many others, to be frank – America’s allies both in Europe and Asia are living it up, sacrificing defense spending in order to fund lavish welfare states, while leaving the United States to pick up the bill.

Like I said, it’s not just Trump who feels this way; many Americans think they are being taken advantage of. I recall a meeting in Washington two decades ago, listening to my coworkers lament that Germans would rather spend their money on community swimming pools than on defense. Why not, I replied; they get a lot more use out of those swimming pools than they would from buying another tank.

The hegemon’s burden

There is a perverse satisfaction in this “poor-me-I’ve-got-to-have-a-huge-military-and-run-the-world” mindset. It permits the United States to play both the hegemon and the victim at the same time.

But assuming a greater burden when it comes to international defense and security is simply the price one pays for being a superpower. According to “hegemonic stability” theory, the leading power – in this case, the US – pays more because it gets more. In this case, it gets to be the superpower: it basically runs the international system, and it generally has the final say in how things are done in the world.

There is a price to be paid, of course. Since its interests and actions are everywhere, it has to have the ability to project power – military power – on a worldwide scale (European Nato states, for the most part, only have to protect Europe). This means a much larger military, one with global reach and global clout, and that is going to cost money.

The hegemon also has to give a little. It cannot run the world simply for its own interests and purposes, or else it will run out of allies and friends (which seems to be what Trump is trying to do, knowingly or not). The superpower has to accept that it is going to get less for its buck than its smaller partners on a percentage basis because it is ultimately going to get the biggest share overall.

Trump and zero-sum thinking

This is what Trump and his ilk fail to understand. Hegemonic stability is not a zero-sum game, but rather a positive-sum play that is sometimes hard to make out when one is too close. Only the perspective of history shows its eminent value.

Trump is, at his core, a real estate man, and most real estate business is transactional; it’s all one-off, short-term, and bottom line. And to him, transactions are mostly zero-sum. So he looks at how much the United States spends on defense versus the US’s Nato allies, and he sees only the current gulf in defense spending.

In the first place, this gap has existed for decades. The United States has always outspent the rest of Nato, both in absolute terms and as a percentage of GDP. Again, that is the nature of the hegemon, which has to – wants to – be everywhere.

The Nato member states agreed with the Obama administration to gradually increase their respective national defense budgets to 2% of their GDPs by 2024. Progress has been slow but unmistakable

Likewise, US presidents have for decades berated Europe about increasing its defense budgets. Jimmy Carter, after the Soviet invasion of Afghanistan in 1999, got Nato to agree to annual 3% increases in military spending. Even during the worst of the Cold War, however, it failed as an initiative.

More recently, the Nato member states agreed with the Obama administration to gradually increase their respective national defense budgets to 2% of their GDPs by 2024. Progress has been slow but unmistakable.

Now Trump is calling for Nato countries to raise their military expenditures to 4% of GDP, and to do it immediately, adding that Germany could, if it wanted, double its defense spending practically overnight.

Percentage-based defense spending

Interestingly, about 10 years ago, Republicans in Congress were arguing that the US defense budget should be directly pegged to 4% of GDP, arguing that defense needs required a “stable and predictable” level of funding.

But there is nothing magical in a 2% or 4% solution. Advocates provide no sound military rationale for linking defense to either of these particular percentage points. Why not 5% or even 10%? Or perhaps – as a recent article in The Atlantic points out – the problem is not that Europe is spending too little on defense but that the United States is spending too much. Certainly, conservatives and advocates of higher US military spending have done a poor job arguing their case.

There is, of course, no simple answer to the question as to what constitutes optimal military spending. The “how much is enough?” question can never be resolved. Ultimately, defense spending is like any other type of budgeting, a matter of juggling needs, wants, and expectations.

So what is it going to be: a swimming pool or a tank?

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