European defense budgets have been on a downward slope for years, and this decline is likely to continue as the region struggles to recover from the recession and battered economies of the past four years. Defense capabilities are being meaningfully cut at a time when the technology imbalance between NATO haves and have-nots—evident in air operations over Libya—is already a serious Alliance concern.
Yet NATO has survived and will probably continue do so.
The reasons it came to be and has served as the most successful security alliance in history still hold. Europe wants a means to anchor the US in that continent. After centuries of conflict, most European governments still think the denationalization of defense is a fine idea. And there is always the need to guard against unpleasant surprises—such as an aggressive Russia or belligerent Iran.
Perhaps NATO is now entering its third era. The first was the Cold War against Soviet expansionism. The second was the scramble to accept new members while handling a variety of conflicts following the fall of the Berlin Wall. The third may well be a post-Afghanistan retrenchment. This could be a time of consolidation as allies work on making their militaries more complementary and reach out to neighbor groups in the Alliance near-abroad.
"NATO will survive as an alliance. We’ve moved a long way from the Cold War via different concerns, via different risks, but it’s still a pretty robust alliance that’s never everything we want it to be," said Malcolm Chalmers, research director of the Royal United Services Institute for Defense and Security Studies, at a Brookings Institution seminar last year.
The North Atlantic Treaty, which established the Alliance, was signed in Washington, D.C., on April 4, 1949. Since then member nations have often been embroiled in arguments about their mutual strategic direction. In the early 1950s, NATO struggled to accommodate historic adversaries Greece and Turkey within the military command structure. The 1979 decision to deploy new Pershing II nuclear missiles in Europe in response to Soviet SS-20 IRBMs was fraught with controversy. The collapse of the Soviet Union left the Alliance rudderless for a time.
The beginning of the latest era of NATO pontification came with Robert M. Gates’ valedictory speech as US Secretary of Defense. In June 2011, Gates warned that a new generation of post-Cold War US political leaders might walk away from Europe due to exasperation over European dithering and continued defense cuts.
"In the past, I’ve worried openly about NATO turning into a two-tiered alliance, between members who specialize in ‘soft’ humanitarian, development, peacekeeping, and talking tasks, and those conducting the ‘hard’ combat missions. ... This is no longer a hypothetical worry. We are there today. And it is unacceptable," said Gates in a blistering address in Brussels, Belgium, to top European officers and officials.
The Libya operation "shone a bright light on relative military and political capabilities in terms of who ‘could but wouldn’t’ and who ‘would but couldn’t,’ " said Hammond in a November 2012 speech at the UK’s Chief of the Air Staff airpower conference. Hammond added that with the US now rethinking its strategic options, Europe will have to accept more responsibility for its own security and for its periphery. That will mean shouldering a major burden in continuing stability operations in the Balkans and Mediterranean—and perhaps taking on a bigger role in North Africa and the Middle East.
"The bottom line is that Europe, as a whole, needs to do more, at a time when the reality is that, across the continent, aggregate defense expenditure is certain to fall in the short term and, at best, recover slowly in the medium term," Hammond said. So the challenge is, if Europe can’t spend more, it must do things differently, he said.
The word that might best describe NATO budgets is "constrained." The Alliance’s informal goal is for members to spend two percent of their gross domestic product on defense.
According to figures compiled by the World Bank, which uses a broad measure for defense accounts, in 2011 the only NATO nations reaching this benchmark were France, Greece, Portugal, Turkey, the UK, and the US.
Taken as a whole, America’s European allies spend about 1.5 percent of their GDP on the military, according to Council on Foreign Relations senior fellow Charles A. Kupchan. The comparable figure for the US is more than four percent. The US is likely to scale back the Pentagon’s budget in coming years, and that may make Washington even more sensitive to the ability of its partners to pick up their fair share of NATO responsibilities.
"Inequitable burden sharing has strained trans-Atlantic relations even in good economic times," said Kupchan in 2012 testimony to the Senate Committee on Foreign Relations.
Most of Europe’s military reductions have been horizontal, applied evenly across operations, maintenance, and investment accounts. "These typical responses result in a growing array of forces that are not ready, not trained, and not sufficiently equipped or supplied—a widening ‘invisible’ gap across the Alliance," write National Defense University scholars Charles Barry and Hans Binnendijk in a recent report on the subject from NDU’s Institute for National Strategic Studies.
A few nations have saved money through highly visible vertical cuts that eliminate a particular system or capability. Netherlands, for instance, has eliminated heavy tanks. In turn, this means the Dutch can afford missile defense radars for deployment on frigates.
The danger of vertical cuts is that they can take place without regard for what one’s compatriots are doing. This could lead to a growing "self-selection" of roles within the Alliance, according to Barry and Binnendijk.
They judge that the current tight fiscal environment will last until at least 2018. "In the future, more cuts will be vertical as nations realize this is the only way to achieve real savings and to protect their most desired capabilities," according to the NDU scholars.
For its part, the US is already planning vertical reductions in Europe. In January 2012 the Obama Administration announced it would withdraw two Army brigade combat teams and an Air Force fighter squadron from Germany by 2014. These withdrawals—with associated changes in command structures—will reduce the US footprint on the continent by some 11,000 personnel. When they are finished, the American presence in Europe will stand at just under 70,000 personnel.
To Pentagon budget-planners these adjustments may make sense. The lighter US units that remain in many ways are a better fit with Europe’s own land armies. But European officials might take the change harder.
"The withdrawal of heavy brigades removes US main battle tanks in Europe for the first time since 1944. The symbolism of this passage for our allies is far more significant than it is for Washington. Reassurance of the US commitment to collective defense is at a premium not only because of US troop drawdowns; fears of gradual decoupling have been growing in recent years due to the US focus first on the Middle East/South Asia regions and now on the Pacific," write Barry and Binnendijk.
So how to keep the old NATO gang together? For a start, officials might concentrate on the positives.
In Libya, NATO aircraft helped drive a tyrant from power in an operation led by Britain and France. NATO sea patrols have contributed to cutting the rate of piracy by three-quarters of previous levels in the dangerous waters of the Gulf of Aden and off the Horn of Africa. In the face of Russian complaints, NATO members reached a difficult political and military consensus on the deployment of ballistic missile defenses, and American BMD radar was deployed to Turkey and began operation in December 2011. Romania and Poland have agreed to host interceptor missile sites beginning in 2015 and 2018, respectively, and four interceptor-equipped Aegis warships will be based in Spain beginning in 2014.
In Afghanistan, the end is in sight for NATO’s largest and longest combat operation. At the 2012 Chicago NATO summit, allies agreed to hand over defense of the country to Afghan forces in 2014. Afghanistan’s future remains in question due to continued Taliban strength and endemic corruption in Hamid Karzai’s government, but throughout the difficult Afghan experience NATO allies have largely stuck with the US—however much some may have been edging toward the exits.
After 2014 some NATO trainers will remain to try and bolster indigenous units, and the Alliance as a whole will defray the cost of this effort.
As to the future of forces in an era of defense cuts, clearly NATO must try to do more—or at least the same—with less. Already in Europe, governments are beginning to shift defense dollars away from personnel to investment, according to Daalder. The US has long complained that European defense forces are soldier-heavy and spend too little on procurement and research and development. Now the Germans, for instance, appear to have taken this to heart and are rebalancing their military budget.
In addition, NATO Secretary General Anders Fogh Rasmussen is pushing for more joint development, acquisition, and maintenance of assets via a "Smart Defense" initiative. Currently the Alliance boasts 24 multinational Smart Defense efforts, ranging from remotely controlled robots for clearing roadside bombs to the pooling of maritime patrol aircraft to multinational medical facilities. At the Chicago summit Denmark signed on as the 14th ally to join a group purchase of five Global Hawk remotely piloted aircraft for delivery around 2015.
"The Alliance will pay for the operation and support and maintenance as well as the infrastructure for these drones," said Daalder. "And as a result, we now have a capability that individual countries could never purchase themselves, and that’s a real capability with real output down the line. And that’s how we need to in these next few years focus on spending our dollars and Euros more wisely."
But co-op shopping isn’t something the Alliance just discovered. NATO has long operated a fleet of 17 jointly owned and flown E-3A AWACS aircraft. There is also the newer and smaller joint strategic airlift wing of three C-17s, with NATO members representing most of the 12 partner nations.
In the wake of the Afghanistan operation it is clear NATO is unlikely to turn into a global security organization. That would be an unsupportable financial burden and create insurmountable political divides, according to Kupchan. "Trying to turn the Alliance into an all-purpose vehicle of choice for military operations around the world would likely lead to its demise, not revitalization," Kupchan told the Senate Foreign Relations Committee.
The Alliance needs to keep its military forces in as fine a shape as possible. Missions on Europe’s edge or in its backyard of North Africa and the Middle East can emerge without warning. In 2010, few envisioned NATO-led Tornados over Tripoli.
But in coming years some of NATO’s most effective contributions to global security may come in the form of capacity building, according to Kupchan. It could teach others the things that have served the Atlantic community so well: regional cooperation on military and political questions.
"Some of the most important security institutions of the 21st century are likely to be regional ones, such as the Gulf Cooperation Council, the African Union, the Association of Southeast Asian Nations, and the Union of South American Nations. NATO should be investing in the efficacy of these regional bodies," Kupchan said.
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