“Americans know that a strong alliance of free, sovereign and independent nations is the best defense for our freedoms and for our interests. That is why my administration has demanded that all members of NATO finally meet their full and fair financial obligation. As a result of this insistence, billions of dollars more have begun to pour into NATO. In fact, people are shocked. But billions and billions of dollars more coming in from countries that, in my opinion, would not have been paying so quickly.”
–President Trump, speech in Warsaw, July 6, 2017

Whenever we delve into Trump’s rhetoric on the funding of NATO, the North Atlantic Treaty Organization, we find that he fundamentally mischaracterizes the way NATO works. This was true of candidate Trump, who received Three Pinocchios for a series of misleading claims about NATO funding, and of President Trump, who received an updated rating of Four Pinocchios for his failure to correct his talking points.

Trump now says new money is pouring into NATO because of his administration. We logged versions of this claim at least 15 times in our Fact Checker database tracking every false or misleading claim by Trump in his first full year as president.

This is yet another case where Trump is quick to take credit for decisions others made prior to his election, or unrelated to his presidency. Let’s dig into the facts.

The Facts

Trump started making this claim when he ad-libbed it in his maiden speech to Congress at the end of February — a month into his presidency. “I can tell you the money is pouring in. Very nice,” he said, mentioning he was pressing NATO allies in “very frank and strong discussions.” As we noted at the time, this is nonsensical.

NATO was established in the aftermath of World War II. It began with 12 members in a defense alliance among Western European countries, the United States and Canada to counter the Soviet Union and its satellite countries in Eastern Europe (known as the Warsaw Pact). After the Soviet Union collapsed and the Warsaw Pact unraveled, NATO expanded to include many Eastern European nations and even former parts of the Soviet Union. There are now 29 member countries in NATO.

There are two types of funding for NATO: direct and indirect. Direct contributions are shared among the 29 member states to pay for the costs of the actual alliance (for example, maintenance and headquarters activity). But when Trump talks about “financial obligation” and money pouring into NATO, he is talking about indirect spending. (The White House did not respond to our request for explanation.)

Indirect spending is the money NATO countries spend on their own defense budgets. These contributions are voluntary and not legally binding. Each country decides what to contribute based on their own defense capability.

Each NATO member has had this 2 percent spending guideline since 2006, but not everyone had been actively working toward that. Then during a 2014 summit in Wales, NATO members pledged to stop cutting their defense expenditure and “move toward” that 2 percent guideline within 10 years. This decision, taken just months after the annexation of Crimea, was a response to Russian aggression in Ukraine.

That means long before Trump started complaining about other countries’ NATO contributions during the campaign and into his presidency, members had committed to having defense spending account for 2 percent of each nation’s gross domestic product by 2024.

Since the 2014 meeting, defense expenditures from member countries increased steadily. The cumulative spending increase from 2015 to 2017 above 2014 level is an additional $45.8 billion, according to NATO’s announcement from June 29, 2017.

Defense spending from non-U.S. members is estimated to increase $13 billion in 2017. But there is no evidence the Trump administration had anything to do with these countries’ independent decisions to bolster their own defense spending. These budget decisions were made during the 2016 calendar year, before Trump became president.

In 2017, six countries met the 2 percent goal. United States leads the pack at 3.6 percent. The other countries are Greece, Estonia, Britain, Romania and Poland. (Greece met the guideline even though it slashed defense spending, because its economy collapsed. This is why some experts say the guideline is rather arbitrary.)

Other nations — especially ones that border Russia or Ukraine — have bolstered their defense spending in response to perceived threats from Russia. Romania and Poland are former members of the Warsaw Pact.

“Who deserves the most credit? Vladimir Putin. It was the invasion of Crimea, the launching of insurgency backed by Russia in Eastern Ukraine, that was the wake-up call for the majority of the allies,” said Alexander Vershbow, former deputy secretary general of NATO. “It took a while to see the results; 2015 was not a year of substantial increases but 2016 was. So again, Vladimir Putin and his aggressive behavior deserves more credit than the president of the United States.”

Every U.S. president in recent memory similarly called on other countries to increase their defense spending, experts say, but Trump’s rhetoric may have lit a fire for countries setting their budgets for 2018 and beyond. For example, at the May 25 NATO meeting, member countries agreed to develop a plan by the end of 2017 showing how they would meet the 2 percent guideline.

Still, Trump goes way too far taking credit, and no new commitments have been made since he became president.

“Even if you wanted to take a look at the impact that Trump had on defense spending, you have to wait a few years,” said Jim Townsend, former deputy assistant secretary of Defense for European and NATO policy. “If you see a huge surge in 2018, you can ask: Was that a Trump surge or something else causing that? But you have to get there first. The money that is in the budget this year was set in motion last year.”

The Pinocchio Test

Trump certainly is not the first president to insist other members of NATO increase their defense spending. Yet he says that because of his insistence, countries are spending “billions and billions” more. Defense spending by NATO countries increased since they agreed in 2014 to work toward the 2 percent guideline, in response to threats from Russia. Increases in spending since then were the countries’ voluntary, independent decisions preceding his presidency.

This over-the-top rhetoric goes way too far, once again pushing him into Four-Pinocchio territory.

Four Pinocchios

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Four Pinocchios
"That is why my administration has demanded that all members of NATO finally meet their full and fair financial obligation. As a result of this insistence, billions of dollars more have begun to pour into NATO. "
speech in Warsaw
Thursday, July 6, 2017