J.D. Foster
The U.S. Navy continues to strike the Houthis while seeking to keep the Red Sea open for commerce. Nineteen other countries reportedly are part of the coalition, but only the U.K. has provided any firepower in the form of a single destroyer. As usual, the rest of the western so-called “powers” are AWOL, powerless.
One of Donald Trump’s endearing traits is shouting what the cognoscenti know to be true but won’t even whisper in public. In 2016 he said the U.S. should dump NATO. Why? Because it’s a big rip-off. Seven years later even Jamie Dimon, CEO of JP Morgan, admits Trump was “kinda right” about NATO.
NATO is a rip-off because it is largely a collection of free riders living under the national security umbrella provided by American taxpayers and a handful of other responsible members like Poland and the U.K. In 2006, NATO’s members committed to spending 2% of GDP on defense. That’s a pitifully low figure, but it’s a start. As of 2023, two-thirds of NATO members fell short, many far short.
Few of NATO’s members have the economic heft to make a material difference. For example, seven of those exceeding the 2% target have economies about the size of New Jersey or less. NATO’s Hall of Shame is reserved for Germany, France, Italy, Spain, and Belgium which bring the economic size to matter but which have for nearly two decades been deep in arrears. The total shortfall since 2006 likely exceeds a few hundred billion dollars in spending on war material alone.
The shameful laggards make all the appropriate noises about getting to 2% — over time, apparently measuring time on geologic scales. Typically, the U.S. government smiles, says thank you, and leaves it at that while the laggard giggles all the way home. What credibility does the U.S. have if supposed allies get away with this insulting nonsense year after year?
President Biden will tolerate this rip-off indefinitely, so what should a President Trump do? Take a page from Don Corleone’s playbook: Make NATO an offer it can’t refuse.
The offer: NATO’s members must carry their weight in defending their way of life. Specifically, countries previously meeting their 2% commitment must now hit 2.5% and must do so by 2026. Poland currently leads with 3.9%, the United States and Greece following at 3.5% and 3%, respectively. If Greece can do 3%, even the U.K. can up its game a bit.
And for those countries that have traditionally lagged, they must meet a 3% target for at least 10 years to make up for past shortfalls. Mein Gott nein!, the Germans will no doubt caterwaul.
Jawohl, meine damen und herren. You want to be a member of the club? You have to pay your dues. And if you don’t, membership suspended immediately.
What would really happen if NATO dissolved? Not much that is bad. For starters, roughly 4,000 bureaucrats and officers would be on the street and re-assigned.
True, NATO was modestly useful for coordinating a response to Russia’s attack on Ukraine, but it was hardly essential. These other countries all have telephones.
The greatest good from NATO’s dissolution starts with the understanding the U.S. will still be an ally, but not a fool. Another positive is that absent the U.S. umbrella, maybe Germany and the rest would take their own security more seriously.
It’s a dangerous world out there with Russia belligerent, Iran threatening, and above all, China rising. The American taxpayer has played patsy too long while NATO’s Hall of Shame smirked. America will continue to play its leading role when and as needed because it’s in her best interest to do so, but it’s long past time for the rest of the troupe to get serious or get out.
JD Foster is the former chief economist at the Office of Management and Budget and former chief economist and senior vice president at the U.S. Chamber of Commerce. He now resides in relative freedom in the hills of Idaho.
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