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Defense or Destruction? The Fallout of NATO’s 5% GDP Gamble

Abbas Hashemite, July 04, 2025

NATO’s agreement to dramatically increase military spending under pressure from Donald Trump threatens economic stability, climate goals, and global security, while revealing the alliance’s growing internal divisions and moral contradictions.

 The Fallout of NATO’s 5% GDP Gamble

Since Trump assumed Presidential powers in the United States, NATO has been struggling to maintain its unity. The US President demanded increased investment in NATO by the European countries. The European leaders have recently agreed to Trump’s demand, leading to further instability and chaos globally.

US President Donald Trump has long been critical of his country’s increasing investment in NATO and the lack of substantial monetary contributions by other members of the organization. After his re-election as the US President for his second non-consecutive term, Donald Trump threatened other NATO allies by downplaying his country’s commitment to defend them against any regional or global threat. In a similar move, he urged Russia to invade NATO members which failed to fulfill their financial and economic commitments to the organization.

The increase in NATO’s spending will only jeopardize humanity by sparking a climate crisis, augmenting inflation in Europe, and cutting social and environmental expenditures

Although such statements provoked international criticism, none of the NATO members dared to stand against Trump. The European countries knew that NATO was nothing more than a house of cards without the US support. In pursuit of his ‘America First’ policy, Trump has adopted a peculiar approach to multilateral issues. He also blackmailed Ukraine to gain a considerable share in its rare earth minerals. Trump’s gamble with the NATO members also proved successful, as they agreed to his demand to invest 5 percent of their countries’ GDP on core defense requirements as well as defense and security-related spending by 2035’.

A Politically Driven Surge in Military Spending

This move has been regarded as a “quantum leap” by Mark Rutte, the Secretary General of the North Atlantic Treaty Organization (NATO). He further stated that this increased spending would ensure “freedom and security” of the citizens of the member states of NATO. It marks a historic surge in military spending. However, its effectiveness in terms of security provision is highly questionable.

Trump had been firm in his demand for a 5 percent investment increase by the NATO member states. However, over the past few years, many European nations even considered the 2 percent investment target in NATO as unrealistic. However, only six countries complied with this goal by the year 2021. Nonetheless, this number surged to 23 over the next three years, with the remaining states expected to achieve the target by 2035.

The recent commitment of NATO to increase spending by 5 percent of the GDP is more than double its previous spending target. Meeting this new commitment will be a tough task for the member countries. However, it demonstrates the NATO state’s willingness to satisfy the impulsive US President Donald Trump. Most likely, the member states will use manipulative techniques to hit the target. Despite this, there will be an unprecedented increase in military expenditure over the next decade.

Economic and Social Fallout in Europe

In 2024, the alliance’s total military spending, $1.5 trillion, exceeded more than half of the world’s military spending. The 5 percent GDP investment commitment will raise this spending manifold. This increased spending will result in economic instability in European countries. Most likely, this money will be diverted from different public sectors, including the environment and health, making the life of the European citizens more difficult. Pedro Sanchez, the Prime Minister of Spain, who strived for his country to gain a partial exemption from this new investment increase, stated, “If we had accepted 5 percent, Spain would have to spend by 2035 an extra 300 billion euros on defense. Where would it come from? From cuts in health and education.”

Many countries in Europe have already cut their social and environmental spending. The UK, France, and Belgium are amongst the few European countries that announced a decrease in aid budget to expand their military spending. Moreover, the United States has also announced a $1.01 trillion budget allocation for defense budget while reducing foreign aid and cutting climate and health sector expenditures under President Trump. Many of the NATO member states are already facing difficulty in achieving their social and environmental targets. This new increase in military spending will make it more difficult for these countries to achieve these goals, casting a negative impact on the lives of their citizens.

Environmental Destruction and Geopolitical Escalation

NATO is one of the biggest contributors to climate change due to its high carbon emission rate. Studies reveal that an increase in NATO’s military expenditure will hasten the climate crisis, as it would result in 200m tonnes of greenhouse gas emissions every year. NATO’s argument to increase its military spending is to curtail the rising threat of terrorism and Russia, an explanation that does not justify a 5 percent GDP increase in military spending. Moreover, there is no realistic account of the reasons for such a colossal increase in threats to NATO countries. There is a strong need for self-examination of NATO states to understand how their own actions sparked an armed conflict between Russia and Ukraine.

The increase in NATO’s spending will only jeopardize humanity by sparking a climate crisis, augmenting inflation in Europe, and cutting social and environmental expenditures. If NATO or the West seeks to make the world a peaceful place to live in, it needs to stop financing Israel’s war crimes in Gaza. In addition, it also needs to play a constructive role in peace talks between Russia and Ukraine. NATO’s funding of Ukraine jeopardizes the security and sovereignty of Russia. Therefore, security and peace in Europe are only possible after the West stops instigating conflicts in the Middle East and Asia.

 

Аbbas Hashemite – is a political observer and research analyst for regional and global geopolitical issues.  He is currently working as an independent researcher and journalist

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