Just like taking care of a pretty ‘bonsai’, national defense only maintains its name.
Despite 30 years of growth in economic size, defense spending has remained the same.
Welfare expenses continue to increase, more than doubling
Farmers protest, public protests over ‘welfare expenses VS defense expenses’ debate
NATO pledges to spend 2% of GDP on defense, concerns over exposure to financial resource limits
“The European ‘Bonsai Army’ has only fostered the bonsai industry.”
Christin Mölling, Vice President of the Council on Foreign Relations, a German think tank, said this while pointing out the European defense situation. The criticism is that after decades of cultivating pretty saplings, they have degenerated into an ‘army of plants.’
The British Economist pointed out that “Europe will face painful adjustments to increase defense spending.” In the 30 years of peace since the collapse of the former Soviet Union, Europe has used the cuts in defense spending to increase social welfare budgets.
As the global security landscape has changed rapidly in the past one to two years, European countries have been at a loss. Despite the threat of Russia’s advance into Eastern Europe and former U.S. President Donald Trump’s move to withdraw support for the North Atlantic Treaty Organization (NATO), the country has pledged to increase defense spending, but analysts say it will not go smoothly. According to the Economist, as of 1991, gross domestic product (GDP) increased by more than 60%, and in the process, defense spending in real value decreased by 25% in 2015. During the same period, welfare costs increased by 120%.
The IFO Institute estimates that Europe has uninvested about 550 billion euros in defense spending since 1991. In fact, as of last year, only 10 out of 25 European NATO member countries kept their promise to spend 2% of GDP on defense. In particular, it was limited to Germany (1.6%), France (1.9%), Italy (1.5%), and Spain (1.3%), which have large economies.
The Economist said, “To reach NATO’s 2% defense spending target, we need to reduce welfare and refocus defense as a top spending priority,” and added, “But European voters are opposing pension cuts to buy tanks.” In fact, in Italy, according to a public opinion poll, only 28% agreed to increase defense spending, and 62% expressed their intention to freeze or reduce defense spending.
As an alternative, the government could create a budget plan that expands borrowing, but in the aftermath of the coronavirus pandemic, there are many countries in Europe whose debt has already exceeded 100% of GDP. According to the FT, the EU’s average national debt-to-GDP is over 80%, and in France, Greece, Italy, and Spain, it is over 100%, resulting in a lack of borrowing capacity.
In a recent interview with FT, Finnish President Alexander Stubb, who took office in March, urged European leaders to stop just talking and take action to strengthen their military capabilities. President Stubb said, “Europe had an opportunity to change its mindset from the ‘la la land’ of the post-Cold War era, when the possibility of war was low,” and emphasized, “Everyone must prepare, not just the frontline countries of the alliance and the European Union.”
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