NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security

Executive Summary

Security is one of the most essential tools for maintaining global peace and security worldwide. Consequently, some governments leverage their geopolitical strengths to maximize global security interests. This background explains the formation of the North Atlantic Treaty Organization (NATO), a quasi-military force comprising 30 western-allied states. The founding partners, including the United States (US), Canada, and the United Kingdom (UK), originally formed the military outfit to deter the Soviet Union from attacking allied members. Therefore, NATO’s primary role has been to safeguard the interests of member states locally and internationally.

Headquartered in Brussels, Belgium, NATO has a strong military presence in Europe and North America. At the same time, it has millions of soldiers stationed in several countries worldwide, making it one of the world’s most significant international military forces. NATO’s partners are among the largest military forces in the world in terms of resourcing and technological advancement.

Additionally, NATO countries’ combined military spending is among the highest in the world. Thus, it is one of the best financially resourced military groups internationally. However, recent developments in the American political and international stages have revealed that member nations are not making equitable contributions to the alliance’s collective resources. In particular, some partners have accused others of not allocating 2% of their Gross Domestic Product (GDP) toward defense expenditures, as was previously agreed.

The findings of this research paper affirm that NATO’s financial difficulties stem from the noncompliance of certain member states, as they have neglected to contribute their fair share to the organization’s collective fund. They have neglected to provide their equitable share of contributions to the organization’s collective fund, thereby making it difficult for the alliance to function optimally. This problem is complex and characterized by the prioritization of different security interests among allied partners, the lack of accountability of financial contributions made by member states, and the failure of allied partners to anchor the requirement of paying 2% of the GDP value to defense spending in law. At the same time, this paper demonstrates that some allied members have failed to make their financial contributions because broader geopolitical risks have changed, including a diminished threat of war globally and the rise of economic difficulties impacting certain member nations.

Based on the challenges mentioned above, this paper proposes that member states should adopt innovative ways of encouraging partners to make their fair share of contributions to the common financial kitty. This plan includes accepting localized strategies for addressing security threats and redistributing the broader financial burden of defense from a few partners to others who can strategically provide similar standards of security affordably. These proposals are presented in this document as objectives that could be implemented to capitalize on opportunities for securing alternative contributions from member nations to bridge the funding gap between founding and new members. Most of these efforts focus on establishing an alternative military and security response framework to reduce North America’s burden in safeguarding Europe. Pursuing this creative strategy of accepting alternative contributions to NATO’s security strategy should be executed while acknowledging the diverse security priorities of alliance members.

Introduction

The North Atlantic Treaty Organization (NATO) is a quasi-military unit comprising the armed forces of 30 countries. The United States (US) and Canada are the two main non-European member states, while the rest are located on the continent (Nowowiejski 1). Of the 30 current member states forming NATO, 12 are founding partners. They include the United States (US), United Kingdom (UK), Belgium, Germany, France, Denmark, Iceland, Canada, Netherlands, Italy, Luxembourg, Norway, and Portugal (Nowowiejski 1). North Macedonia was the latest entrant to the military alliance, and its accession was completed in 2020 (Green 1). Comparatively, Finland and Sweden will likely join the alliance in the next decade, pending approval by relevant governing bodies.

The NATO intergovernmental alliance was set up after the Second World War. Its purpose was to provide military support to member countries against external aggression (Kimball 164). The underlying principle underpinning its operations is that unfriendly nations would be deterred from attacking any member countries because they would be met with an overwhelming military force from member countries (Truitt 164). This objective is enshrined in chapter five of the treaty, which states that “an armed attack against one or more of the allies in Europe or North America shall be considered an attack against all” (Lewis 99). Therefore, since its inception, NATO has acted as a deterrence against threats from hostile nations.

Subject to the need to protect the interests of its members, NATO member countries resolved to contribute 2% of the value of their Gross Domestic Product (GDP) to defense spending (Kimball 164). This contribution is meant to finance the costs of running the organization, including administration, intelligence gathering, and implementing combat plans (Bina 1-4). However, alliance partners have not been making their fair share of contributions.

Strategic Challenge

Problem Statement

The US is the dominant force in NATO because it acts as a guarantor of the alliance’s security pact. Recent reports show that member countries were not making their fair share of contributions to the alliance’s common financial kitty (Vazansky 18-20). These concerns are not new because they were raised during the reign of Dwight Eisenhower (Gieseke 16).

Officials from his administration claimed that NATO member countries were not shouldering their fair share of the alliance’s security burden (Gieseke 16). Given that these countries have different military, economic, and resource capabilities, the question of how to make each member contribute fairly has been a significant point of concern for many scholars (Bina 1-4). However, most of these questions fail to account for the strategic role played by each partner in supporting the alliance’s operations and the contributions that each member could make to bolster the organization’s security plan. To this extent, it is essential to review the role of individual member states in supporting NATO’s operations.

US National Interests

As highlighted in this study, NATO exists for various reasons. From an American point of view, the alliance helps it protect national interests locally and internationally. For example, on the international front, NATO protects the safety and well-being of the American people and its allied partners (Bóka 1). Additionally, it has a mandate to protect the lives and property of Americans who live in foreign countries and expand economic opportunities abroad (Lewis 99).

Similarly, the US advances its interests through NATO by protecting the American “way of life,” which thrives on supporting shared values, such as freedom and human rights (Cantalapiedra 88). Broadly, the United States receives support from NATO member states in terms of deterrence, deployments, and resource support. These benefits are part of the organization’s natural strategic response to threats.

Threats to American Interests

Several security threats affect America’s interests domestically and internationally. For example, terrorism aims to upset America’s way of life by creating fear and doubt regarding the safety and well-being of citizens (Bóka 128). These issues threaten American interests at local and international levels (Tzogopoulos 1-3).

NATO helps to deter threats to American interests through strategic partnerships. It employs various techniques, including securing the American way of life and protecting allied nations from attack (Bóka 3). NATO equally helps the US to develop political support for its military, economic, political, and social activities overseas (Kimball 164-166). In this regard, NATO partners have helped the US protect the liberal way of life, which is at the center of America’s interests domestically and regionally.

Strategic Environment

NATO Context

After the collapse of the Soviet Union in the early 1990s, most NATO member countries decreased their overall contributions to their defense budgets. Comparatively, Russia increased its defense spending, thereby creating tension among allied member countries about their commitment to sharing their defense risks (Schmies 200-202). Notably, a difference in the perception of risk among European and non-European member states within NATO created an alternate theory regarding why some members decreased their spending (Müller-Brandeck-Bocquet 110). Notably, scholars believed that European member states downplayed Russia’s threat to their security because of their intertwined economies and shared interests (Schmies 200-202). However, as can be seen from Russia’s invasion of Ukraine, this thinking was flawed, and European allies are now grappling with the possibility of seeking alternative measures to contain Russia’s threat to European peace and stability.

United States Context

The US is the leading military power in the NATO alliance. In this regard, it is the de facto leader of the military outfit. Some observers have questioned why the US needs NATO when it is the most powerful military force in the world, speaking of resourcing and financial expenditure. This concern has been faced by some local commentators who have questioned America’s interest in protecting allies within the NATO summit and around the world (Kimball 164-166). These concerns have been partly addressed by scholars who argue that the US has adopted the global leadership position in various aspects of governance, including the democratization of states, the liberation of economies, and champions of freedom (Schmies 200-202). Based on these leadership priorities, the US has assumed the responsibility of protecting the liberal order of the world. In line with this vision, the US needs the support of NATO both militarily and politically to play its global leadership role.

The US security guarantee of NATO places it at the center of the organization’s military framework. Therefore, it is difficult to conceive a scenario where NATO exists, and America is not a part of it. The US’s position of strategic importance emanates from this prestigious positioning internationally. Based on America’s key strategic positioning, it has been accorded a privileged status in formulating and influencing the economic policies of other states (Tzogopoulos 1-3). The outsized role that the US plays in protecting its allies within the NATO union equally emerges from the same privileged status highlighted above.

There are concerns that America’s role as a military leader has dwindled within the NATO alliance. Its dominance is being counter-managed through the actions of mighty military powers located in Europe, such as Germany and France (Bina 1-4). Changing geopolitical dynamics, such as the rise of China, are equally forcing the US to re-evaluate the cost of protecting their interests overseas and re-assess whether it is prudent to use military resources to fight wars that would otherwise be addressed through other means, such as arbitration or diplomacy (Tzogopoulos 1-3).

Overall, the quest for the US to protect its strategic interests through NATO has been nestled within a more significant push to address the US’s problems using the global solutions available. This approach has primarily dominated the foreign policy strategies of the Obama and Trump administrations because they drifted away from the common idea of pursuing a common grand strategy of addressing global problems to a specific policy approach that could be used to address one policy issue at a time.

Broader International Context

In the broader international context, the US classified its global strategic interests into four key areas, which include China, the Middle East, North Africa, and Europe. Given that the US has many allies on the European continent, its strategic interests in the region are largely secured. However, the recent invasion of Ukraine by Russian forces has made it difficult to continue with “business as usual” (Furedi 1). Russia’s attempts at increasing the stakes of securing Europe’s economic and political interests have dragged the US into European geopolitical affairs (Officer 345-347). Notably, NATO’s role in deterring such aggression has been re-activated, with member countries cautious about the extent to which the war could spread to the rest of Europe and, by extension, the world.

In line with the vision of supporting a rule-based world order, the US continues to support Ukraine. Similarly, it is revamping efforts associated with increasing the globe’s attention to the responsibility given by member states to avoid a nuclear conflict (Leith 18). However, China remains a threat to America’s position as a leader in the global social-political order. Its place as a nuclear power holder in the world, coupled with its military, economic, technological, and political resources, means that the Chinese can make changes to the world order (Tzogopoulos 1-3). In this regard, China threatens the US’ position as the dominant global force.

The US has chosen to respond to China’s aggression using three main strategies. The first one is the maintenance and preservation of domestic competencies, including innovation, skilled labor, technological prowess, and strategic global alliances (Mladenov 256-258). The second strategy has been pegged on aligning its strategic plans with those of its allies. The aim has been to advance common interests and promote a global vision premised on pursuing a liberal democratic order. In line with this plan, the NATO alliance is similarly forging strategic partnerships with new Asian allies, notably those that do not subscribe to the principle of territorial expansion through force.

In terms of North Africa and the Middle East, the US has consistently forged relationships and partnerships with countries that share a vision of living in a rule-based world order. These relationships have further extended to addressing several geopolitical security issues, including terrorism, drug trafficking, and human trafficking, among others (Darwich 74-75). Some select countries in the Middle East, including Saudi Arabia and the United Arab Emirates (UAE), have enjoyed cordial support in the Middle East based on shared common values.

Assumptions

The operations of NATO are broadly confined to changing global and political forces affecting the world. Therefore, most assumptions underpinning this investigation are confined to this locus of factors. Relative to this statement, the major assumption underpinning this investigation is that the current political, economic, and social dynamics affecting member states remain constant. Similarly, it is assumed that the Ukraine invasion is a proxy war of NATO-allied forces on the one hand and Russia and China on the other (Mladenov 256-258). This assumption is important in supporting the findings of the current probe because they are intended to explain funding priorities and challenges affecting member states based on the current level of perceived security threats from Russia and its allies.

Political Aim and Strategic Approach

Most concerns surrounding the fair share of the defense burden for member states of NATO focus on two key issues. The first one is the impact of allied defense budgets on the organization’s overall preparedness to manage security threats, and the second one is pegged on understanding the cost of hosting US military facilities overseas (Ponomarev and Stebben 1). Both issues are discussed below within the political organization of NATO.

Allied Defense Budgets

Focusing on the first issue of allied defense budgets, researchers suggest that the funding for allied defense budgets has waned. Despite this trend, the US has still outpaced all of its partners in military spending (Officer 345-347). This outcome has been primarily caused by several factors, but increased aggression by China and Russia has forced the government to increase its military spending for extra protection.

Partly, the invasion of Ukraine by Russian forces in 2014 renewed attempts by some nations within the NATO alliance to increase their military spending to be at par with the US and other compliant nations (Ponomarev and Stebben 1). This resolution was made with the desire to have all nations attain 2% of the GDP on military spending by the year 2024 (Hartley 39). As of 2017, only four nations within the military alliance had complied with this provision. In 2021, the number of compliant countries doubled to eight, which is too low for a military alliance with 30 member countries (Hartley 39). The call has since gained more momentum with the recent increase in hostilities between Russia and Ukraine.

Cost of Maintaining US Forces Overseas

As this study highlights, the second aspect of financial contributions to NATO is dictated by examining the cost implications of maintaining US forces overseas. Subject to this locus of analysis, one could question why researchers have exclusively focused on US operations, although the country is only one member in an alliance of 30. The answer to this question lies in the strategic importance of the US military to NATO’s global military dominance.

Indeed, the US has immense military capabilities and strategic relationships with independent states outside of the alliance that ensures it maintains its global dominance (Solomonovich 60-61). At the same time, the US has several military stations around the world, which enable it to deploy its forces and resources on short notice (Green 77). Thus, the cost of maintaining its forces overseas has been a significant point of discussion for most researchers who have explored this area of study.

The highest concentration of global military forces of the US is found in Japan because the Asian country has outsourced most of its defense needs to the US. Germany has the second-highest number of US troops stationed overseas. At one time, more than 2.5 million personnel were stationed in the nation (Vazansky 19).

Similarly, the Republic of South Korea comes in as the third largest host of US military troops in overseas nations (Solomonovich 60). The Trump administration drew attention to the cost of maintaining these troops overseas and claimed that it came at a great price to the American taxpayer. Thus, it warned that alliance partners who benefitted from these security arrangements should pay the US for protection or be left to shoulder their security needs alone.

The above-mentioned proposal was criticized as populist for its lack of understanding of the manner in which the US military operates. First, the idea that the US military could be bought as a quasi-military force to protect the interests of partner states was criticized for its lack of depth in understanding the security interests that host nations share (Vazansky 19-20). For example, the US’s role overseas was not only confined to protecting alliance members but likewise preventing the illegal transportation of drugs, deadly weapons, piracy, and extremism, among other global security threats involving the contribution of more than one partner state in addressing common threats (Mortenson 986). Therefore, although some countries may not be contributing their fair share financially, they may provide other assistance, such as intelligence gathering and reporting. Thus, the claims made by the Trump administration in redefining the role of the military in overseas operations were misleading.

Implementation/Strategic Objectives

As highlighted in this study, the aim of undertaking the current probe is to find ways of ensuring member states pay their fair share of contributions to the overall defenses of member countries. Key proposals outlined in this section of the analysis highlighted three main objectives that can be fulfilled to create a greater sense of accountability for funds contributed by members. As highlighted below, the first objective would be to improve individual and collective capabilities for managing security threats.

Objective 1- Enhancing individual and Collective Capabilities

Initiative 1

One of the main initiatives underpinning the need to standardize funding plans is nested in the idea of appreciating the importance of improving individual and collective capacities to manage threats facing member countries. This objective is nestled in Article Three of the NATO charter, which states, “In order more effectively to achieve the objectives of this Treaty, the Parties, separately and jointly, using continuous and effective self-help and mutual aid, will maintain and develop their individual and collective capacity to resist armed attack” (Truitt 164). Creating standardized plans of operation would better help members share intelligence and resources for optimum output (Furedi 1). In this plan, individual countries would share and learn from one another.

Initiative 2

Dominant powers within the NATO framework can engage in broader military exercises with weaker nations to enhance their military capabilities. This strategy may ensure that gaps in military response are not witnessed when a real threat materializes (Cancian 24). The current security framework favors smaller nations because the US would be forced to supplement military inadequacies in member countries in the event of an attack (Leffler 164). However, if their capabilities are improved through joint military support, this need diminishes. The overall effect would be a better response by NATO to its present security needs and the reduction of the reliance on dominant military forces within the organization for support.

Initiative 3

Enhancing the individual and collective capabilities of NATO need to be undertaken within the broader framework of a strategic alliance among member countries to streamline their military policies (Leffler 164). This can be done at a ministerial or council level to have the greatest impact. The goal is to ensure that minimal variations in resource needs and requirements are realized. The current setup is skewed towards enhancing the impact of dominant military powers, such as the US, which need more resources than smaller member nations, such as the Netherlands.

Objective 2: Creation of a European Army

The creation of a European army has been touted as one of the main strategic approaches NATO member countries could effectively use to counter security interests affecting the region. France and Germany supported this plan because they believed that the current security operations in Europe largely relied on American personnel (Müller-Brandeck-Bocquet 110).

The creation of a real European army has been touted as an alternate arrangement that would better address the region’s security interests. Having a European army would ease the financial burden that the US experiences from sustaining its American forces in Europe (Leffler 164). Given that NATO’s European partners will mainly resource it, the strategic plan could be a creative way of increasing the contribution of European member states to the unit’s overall resource budget.

Initiative 1

By examining different security issues affecting NATO, it could be easy to justify the creation of a European army that would better respond to geopolitical threats affecting the continent. This plan could decrease the pressure that North American allies experience by financing a majority of the organization’s military budget (Zimmermann 279). Defining NATO’s perceived security risks into different blocks would better customize the organization’s security risks to localized plans (Leith 17-19). For example, the threat posed by Russia to the US and its European partners is different, given that the latter has more intertwined relationships with Russia. This difference emerged in the wake of Russia’s invasion of Ukraine.

It emerged that most European countries that supported the imposition of sanctions on America were dependent on its resources, such as energy. Therefore, it was challenging to support sanctions without addressing the real possibility that Russia would retaliate by introducing energy sanctions on them (Zimmermann 279). Thus, contextualizing NATO’s threats within their contextualized framework supports the justification regarding the creation of a European army to manage regional threats (Cancian 24). The goal is to prevent other member countries, such as the US and Canada, from shouldering the financial burden of maintaining troops in Europe.

Initiative 2

Promoting regional cooperation among European member states would better address specific geopolitical crises affecting NATO and help channel the organization’s resources toward developing better response initiatives. Cooperation could be achieved among nations that face similar threats better than allied members that have other issues prioritized (Schmidt 134). This approach to security risk management could better channel the financial resources of the organization toward addressing specific threats influencing partners (Leith 18).

If other members of the alliance replicate the same approach, a more contextualized structure of resource distribution and allocation would be achieved (Schmidt 134). Consequently, the inefficiencies of having a bloated pool of funds without situational priority would be minimized. This initiative adds impetus to the development of a regional army to address specific security threats.

Initiative 3

Adopting a cost-benefit analysis of hosting US forces on the European continent vis-à-vis a counter strategy of creating a real European army should be aimed at supporting the quest by member states to make their fair share of contributions to NATO. In this cost-benefit analysis framework, the cost of having an actual European army vis-à-vis hosting a foreign one would reveal that it is cheaper to have a European as opposed to an American team to address regional security challenges (Bóka 128).

This justification similarly lends credence to the importance of creating a regional army within the NATO framework to address specific risks. This initiative, coupled with the need to localize negotiations among European partners, supports arguments that a regional security unit should be set up to manage known threats. It will better address security needs more effectively and reduce the financial burden that non-European member states shoulder on behalf of the continent.

Objective 3: Negotiations

Initiative 1

The art of negotiation is presented in this review as one of the initiatives that NATO could use to encourage members to make their fair share of contributions to the organization’s broader interests. This plan is nestled within a wider ploy explained by a scholar named Poast, which stems from the international relations theory (6). It suggests that military strength and the perceived level of threat defined by nations determine the kind of contributions members should make (Poast 6). In the wake of Russia’s aggression to Ukraine, NATO member countries should be reminded that the threat of violence remains high, and members should not relax on their duty to make regular contributions.

Initiative 2

An additional initiative that could be pursued includes setting up a common database for monitoring the contributions of each member state. This initiative stems from the findings highlighted in this paper, which showed that no such record exists. Additionally, before the 2014 NATO summit, it was argued that the requirement of member states to send at least 2% of their GDP on its defense activities had no legal foundation because it was a “gentleman’s agreement” (Kimball 164). Establishing a common record of contributions would help to track the progress made by member nations in increasing their defense spending, which has been highlighted as a priority area of spend in the current probe.

Initiative 3

Based on past negotiations, some countries are making significant progress in increasing their contributions. Setting up a documentation center for monitoring such changes would be helpful in the development of the organization’s finances (Darwich 74-75). This plan will encourage members to increase their defense spending and invest in industrial defense capabilities (Darwich 74-75). It may equally encourage alliance partners to collaborate with friendly countries to strengthen their military cooperation agreements in several areas of security and governance management.

Orchestration

Some of the objectives outlined above need to be implemented in coordination with global and regional bodies, including the United Nations (UN) and the European Union (EU). It is necessary to do so because specific charters within global bodies, such as the UN, supersede those of individual member states (Cantalapiedra 88). Therefore, the plans outlined above need to be orchestrated with their contribution. This support has been instrumental in supporting the deployment of troops to North Africa and the Middle East (Cantalapiedra 88). Similarly, it is vital to ensure that some of the initiatives presented in this context are consistent with human rights doctrines and principles shared by NATO member states. Similarly, they need to be in tandem with global best practices affecting the operations of member states and the military organization.

Risks and Costs

The risks and costs of adopting some of the plans outlined in this study need to be measured within the broader mandate of NATO, which is to advance the peace and security of member states. Therefore, initiatives that deviate from the core mission, which is to protect the safety and security of member states, are costlier than those that merely strive to maximize value for money (Mortenson 986). This philosophy explains why an innovative approach to measuring the contributions of member states needs to be adopted to achieve fairness in the broader transatlantic organization. Thus, objectives that help member nations to attain their core goals by appreciating the contribution of each member state are likely to thrive.

Tests of Strategy

Suitability and Feasibility

In terms of suitability and feasibility, NATO member countries have developed plans for ensuring member states pay their fair share. However, the suitability and feasibility of current strategies are affected by challenges in the implementation and comparison of performance metrics (Ota 10-11). For example, the claim that the US surpasses its minimum GDP spending on NATO more than its partners has been met with criticism from observers who note that the US military needs are more than those of its alliance partners (Hartley 39). Consequently, the country’s high national military spending is a natural response to its military needs. Comparatively, NATO European partners do not have similar spending needs and can live comfortably under-spending on their defense operations.

The suitability of current plans to standardize defense spending is clouded by challenges of suitability and feasibility of claims. Additionally, the claim that the US is owed money by member states has been countered by reports that NATO has no official record of how much each member contributes to the alliance (Hartley 39). Therefore, it is difficult to maintain such a claim if member states benefit non-monetarily. The main argument being dispensed in this analysis is the view that America’s high expenditure on NATO is not intended to only maximize the benefit of other nations’ security interests but the US’s own welfare as well. Thus, it could be misleading to argue that the high expenditure of the US is exclusively for the benefit of member countries.

Desirability and Acceptability

The desirability and acceptability of a strategy largely revolve around the need to address intrinsic and extrinsic factors affecting the implementation of proposed actions. The September 11 attack in the US is perhaps one of the latest incidences of provocation that invoked NATO’s defense charter. This resolution was confirmed in October 2001 when NATO member states agreed that the nature of the attack met the threshold for response. Based on this response, it can be argued that the desirability and acceptability of new strategies depend on the severity of threats.

Sustainability

The sustainability of the above-mentioned strategies depends on several factors. Traditionally, the unity of NATO member states and their willingness to work with one another on several areas of global and geopolitical security issues could be interpreted to mean that allied members collaborate because they have a common enemy. However, given that this cooperation has improved despite the changing nature of perceived common threats, the unity of its members has primarily been founded on shared principles, norms, and values. Given that these elements are treasured by member states, they have created a collective identity, which may persist in one form of institutional order or another.

Overall, based on the above-mentioned foundations of research, the inability of member states to fail to pay their equal share of contributions should not be misconstrued to mean that they are unwilling to do so. Instead, their actions should be contextualized within the broader global security perspective of diminished perceived threats of international conflict among nations (Ota 10-11). This environment has been nurtured by increased levels of inter-economic co-dependence and military cooperation to the extent that nations are naturally vulnerable, thereby decreasing the global collective burden of war.

Theory of Success

The theory of social construction explains the intrigues surrounding the relationship between NATO member states. This theory was propagated by scholars such as Alexander Wandt and Martha Fine Moore, who advanced the view that cooperation among democracies best explains why this institution is one of the most successful to have existed after the Cold War (Sander and Vakhtang 49). This theory is fundamentally different from that of practical realism, which supports the idea that NATO would quickly disintegrate after the threat of the Soviet Union diminished with its collapse. However, the military outfit has defied the political motions that would have otherwise led to its demise, including the 1956 Suez Canal crisis and the Euro missile crises of the 1980s (Sander and Vakhtang 49). In this regard, traditional theories, such as liberalism, provide insufficient explanations regarding the origins, existence, and sustainability of NATO as a fledging organization.

Alternatively, the theory of strategic alliance diffusion advances the idea that wars are naturally destructive to national and global economies. Its proponents suggest that when they happen, countries invest most of their national resources into sustaining such wars to the extent that economies may suffer financially and neglect the provision of basic services and commodities. During wars, countries invoke their alliances, drawing in more members, further leading to the diffusion of hostilities from the main aggressors (Kuo 2-3). These members operate as a group to defeat their enemies.

The theory of strategic alliance suggests that one winner emerges from the war and later strengthens their alliance through military cooperation. The tenets of this theory explain the basis for the growth and spread of NATO, which was originally anchored on the dominance of the US after the Second World War. The prestige that comes with winning a war is shared among members of the new alliance. This respect can be reflected in the dominance of NATO in the global geopolitical space. Indeed, from a military perspective, it is the standard for ensuring credible military cooperation works (Kuo 2-3). Except for anchor states, members that join the military outfit engage in a credibility diffusion process where their suitability for joining the organization is evaluated relative to the standards shared by dominant partners.

The economic underpinning of the strategic alliance diffusion theory explains the basis for promoting burden sharing as a core principle for sustaining most of the proposals outlined in this paper. They are aimed at enabling members to make their fair stake of contributions. By paying equitably, member cuties can better finance their military response and deterrence strategies. This plan ensures that the cost of security does not unilaterally cause an existential crisis or lead to the destruction of livelihoods or the way of life of inhabitants.

Conclusion

The findings of this research paper indicate that NATO’s financial challenges have been caused by the delinquent behaviors of some member states failing to make their fair share of contributions to the NATO organization’s common kitty. This problem is complex and characterized by different security priorities, including the diminished threat of security and the emergence of economic challenges affecting some members. Therefore, the insights described in this paper reject the proposal to make all member states share the financial burden of security equitably or equally. Instead, each one of them can contribute non-financially to the more significant cause.

Excerpts from interviews and speeches made by NATO officials suggest that this problem had not been taken seriously until the Trump administration highlighted it. At the same time, reports indicated that there were no common records showing the contribution of each member state toward this cause. Consequently, there has been secrecy involved in understanding the full scope of the problem or identifying alliance members with the most culpability. Subject to the challenges highlighted above, NATO needs to redefine contributions that member states can make towards supporting its broader security and military operations.

Objectives mentioned in this study highlight possible initiatives that could be introduced to exploit the potential that exists in seeking alternative contributions from member states to fill the contribution gap. Most of these initiatives are centered on the need for an alternate army and security response infrastructure that would free some of the US’s resources and put them in place to protect Europe. A creative strategy to accept non-monetary contributions to NATO’s security plan should be implemented with recognition of different security priority areas affecting alliance members.

NATO has demonstrated its capability for re-invention, as was seen through its transition from a quasi-military offensive force during the Cold War era to today’s more reclusive military organization. Based on the perceived diminished security threats affecting alliance partners, it is plausible to accept non-financial contributions as a form of payment to bridge the current contribution gap affecting the organization’s operations. This plan should be explored alongside understanding the effects of specific diplomatic options for encouraging prominent alliance members, such as France and Germany, to increase their overall defense spending in the medium and long term. Collectively, these approaches would capture the resource potential that exists within NATO. However, his proposal can only be exploited if member countries look beyond the financial contributions made by individual member states as the only way to support the organization.

Works Cited

Bina, Cyrus. Globalization and the Decline of American Power: The Political Economy of the American Fall. Taylor and Francis, 2022.

Bóka, Éva. Engineering European Unity: The Quest for the Right Solution across Centuries. Central European University Press, 2022.

Cancian, Mark. Future NATO Enlargement: Force Requirements and Budget Costs. Rowman and Littlefield, 2022.

Cantalapiedra, David. NATO and the Greater Maghreb: Geopolitics, Threats, and Great Powers. Rowman and Littlefield, 2022.

Darwich, May. Threats and Alliances in the Middle East: Saudi and Syrian Policies in a Turbulent Region. Cambridge University Press, 2019.

Furedi, Frank. The Road to Ukraine: How the West Lost its Way. Walter de Gruyter GmbH and Co KG, 2022.

Gieseke, Tyler. NATO: Crisis in Ukraine. ABDO, 2022.

Green, Michael. NATO and Warsaw Pact Tanks of the Cold War. Pen and Sword Military, 2022.

Hartley, Keith. NATO at 70: A Political Economy Perspective. Springer Nature, 2020.

Kimball, Anessa. Beyond 2%—NATO Partners, Institutions and Burden Management: Concepts, Risks and Models. Springer Nature, 2023.

Kuo, Raymon. Following the Leader: International Order, Alliance Strategies, and Emulation. Stanford University Press, 2021.

Leffler, Melvyn. A Preponderance of Power: National Security, the Truman Administration, and the Cold War. Plunkett Lake Press, 2019.

Leith, Frank. Jones Sam Nunn: Statesman of the Nuclear Age. University Press of Kansas, 2021.

Lewis, Reece. Legal Fictions in International Law. Edward Elgar Publishing, 2021.

Mladenov, Nicolai. China’s Rise to Power in the Global Order: Grand Strategic Implications. Springer Nature, 2021.

Mortenson, Christopher. Daily Life of U.S. Soldiers: From the American Revolution to Iraq War. ABC-CLIO, 2019.

Müller-Brandeck-Bocquet, Gisela. Germany and the European Union: How Chancellor Angela Merkel Shaped Europe. Springer Nature, 2022.

Nowowiejski, Dean. The American Army in Germany, 1918–1923: Success against the Odds. University Press of Kansas, 2021.

Officer, Lawrence. New Balance of Payments for the United States, 1790–1919: International Movement of Free and Enslaved People, Funds, Goods, and Services. Springer Nature, 2021.

Ota, Fumio. The US-Japan Alliance in the 21st Century: A View of the History and a Rationale for Its Survival. BRILL, 2021.

Poast, Paul. Arguing about Alliances: The Art of Agreement in Military-Pact Negotiations. Cornell University Press, 2019.

Ponomarev, Ilya, and Gregg Stebben. Does Putin Have to Die?: The Story of How Russia Becomes a Democracy after Losing to Ukraine. Simon and Schuster, 2022.

Sander, Christensen, and Maisaia Vakhtang, editors. NATO and the Future of European and Asian Security. IGI Global, 2021.

Schmidt, Julia. The European Union and the Use of Force. BRILL, 2020.

Schmies, Oxana. NATO’s Enlargement and Russia. Books on Demand, 2021.

Solomonovich, Nadav. The Korean War in Turkish Culture and Society. Springer Nature, 2021.

Truitt, Wesley. NATO Reconsidered: Is the Atlantic Alliance Still in America’s Interest? ABC-CLIO, 2020.

Tzogopoulos, George. The Miracle of China: The New Symbiosis with the World. Springer Nature, 2021.

Vazansky, Alexander. An Army in Crisis: Social Conflict and the U.S. Army in Germany, 1968–1975. The University of Nebraska Press, 2019.

Zimmermann, Thilo. European Republicanism: Combining Political Theory with Economic Rationale. Springer Nature, 2019.

Bibliography

Savolainen, Reijo. “Assessing the Credibility of Information Sources in Times of Uncertainty: Online Debate about Finland’s NATO Membership“, Journal of Documentation, vol. 24, no. 11, 2022, pp. 1-13. Web.

Metawe, Mohamed. “Populism and Domestic/International Politics: Theory and Practice.” Review of Economics and Political Science, vol. 20, no 5, 2020, pp. 1-12. Web.

Khalil, Aliaa. “The evolution of EU’s ‘self – presentation’: 1992-2016.” Review of Economics and Political Science, vol. 7, no. 3, 2022, pp. 217-233. Web.

Cite this paper

Select style

Reference

StudyCorgi. (2025, March 7). NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security. https://studycorgi.com/natos-strategic-challenges-financial-contributions-us-interests-and-global-security/

Work Cited

"NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security." StudyCorgi, 7 Mar. 2025, studycorgi.com/natos-strategic-challenges-financial-contributions-us-interests-and-global-security/.

* Hyperlink the URL after pasting it to your document

References

StudyCorgi. (2025) 'NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security'. 7 March.

1. StudyCorgi. "NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security." March 7, 2025. https://studycorgi.com/natos-strategic-challenges-financial-contributions-us-interests-and-global-security/.


Bibliography


StudyCorgi. "NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security." March 7, 2025. https://studycorgi.com/natos-strategic-challenges-financial-contributions-us-interests-and-global-security/.

References

StudyCorgi. 2025. "NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security." March 7, 2025. https://studycorgi.com/natos-strategic-challenges-financial-contributions-us-interests-and-global-security/.

This paper, “NATO’s Strategic Challenges: Financial Contributions, US Interests, and Global Security”, was written and voluntary submitted to our free essay database by a straight-A student. Please ensure you properly reference the paper if you're using it to write your assignment.

Before publication, the StudyCorgi editorial team proofread and checked the paper to make sure it meets the highest standards in terms of grammar, punctuation, style, fact accuracy, copyright issues, and inclusive language. Last updated: .

If you are the author of this paper and no longer wish to have it published on StudyCorgi, request the removal. Please use the “Donate your paper” form to submit an essay.