“As you know, NATO was suffering very badly from depletion of funds, and it was going down like a roller coaster goes down. Not up, but down. And I was able to, over the last couple of years, increase their contribution. … And over the last couple years, I had them increase by $130 billion. And then, over the next couple of years — and this was done largely over these last two days, but also set up time before that — they had to now contribute $400 billion more. So it’s a total of $530 billion other countries will be putting into NATO.”
— Trump, remarks to members of the U.N. Security Council, Dec. 5
“Tremendous things achieved for U.S. on my NATO trip. Proudly for our Country, no President has ever achieved so much in so little time. Without a U.S. increase, other countries have already increased by $130 Billion-with $400 Billion soon. Such a thing has never been done before!”
— Trump, in a tweet, Dec. 5
“I got NATO countries to pay 530 Billion Dollars a year more, and the U.S. less, and came home to a Fake News Media that mocked me. Didn’t think that was possible!”
— Trump, in a tweet, Dec. 8
We are not here to mock the president. But we need to update our chronicle of how he consistently misunderstands NATO financing.
Back in March 2016, The Fact Checker reviewed some inaccurate statements that then-candidate Trump made about the funding of NATO. We concluded that “Trump is simply wrong on direct funding and is imprecise and possibly out of date on indirect funding.”
Since he became president, Trump has continued along the same path. We offered updates in 2017 and 2018. Given the president’s remarks during and after the latest NATO summit, it’s time for another look at this issue.
NATO was established in the aftermath of World War II, originally with 12 members and the intention of binding together Western Europe in a defense alliance with 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, with the newest member, Montenegro, added in 2017.
There are two types of funding for NATO: direct funding and indirect funding. Direct funding, for military-related operations, maintenance and headquarters activity, is based on gross national income — the total domestic and foreign output claimed by residents of a country — and adjusted regularly.
With the largest economy in NATO, the United States has generally paid the largest share, about 22 percent, but Trump recently demanded a reduction so that the United States will pay about the same share as Germany, or 16 percent. (This is what Trump is referring to when he says the United States will pay “less.”)
But these direct payments — about $500 million a year — are basically a rounding error in the $700 billion military budget of the United States. A significant portion of the U.S. share is operating the Airborne Early Warning and Control System (AWACS) fleet operations, according to the Congressional Research Service.
Trump, when he claims he got $130 billion extra, is really talking about indirect funding. Since 2006, each NATO member has had a guideline of spending at least 2 percent of gross domestic product on defense spending. At a 2014 summit, responding to Russian aggression in Ukraine, NATO members pledged to meet that guideline by 2024.
Note the date — that was three years before Trump became president, and a year before he even announced he was running for president. Yet he persistently claims credit for actions that were underway before he became president — and consistently misleads about where NATO funding was headed before he became president.
For instance, he asserted on Dec. 5: “As you know, NATO was suffering very badly from depletion of funds, and it was going down like a roller coaster goes down. Not up, but down. And I was able to, over the last couple of years, increase their contribution.” On Dec. 3, he even cited looking at a chart: “So NATO, which was really heading in the wrong direction three years ago — it was heading down. If you look at a graph, it was to a point where I don’t think they could have gone on much longer.”
But here’s the chart that NATO published on Nov. 29. It shows that the defense expenditures for NATO countries other than the United States have been going up — in a consistent upward slope — since 2014. As we noted, that’s when NATO decided to boost spending in response to Russia’s seizure of Ukraine’s Crimea region.
With Trump suggesting at times that he would consider withdrawing from the alliance, NATO Secretary General Jens Stoltenberg clearly understands that it is necessary to play to Trump’s ego. At the NATO summit, he thanked Trump for his “leadership on defense spending.”
Stoltenberg, when he’s not speaking in front of Trump, says 2019 was “the fifth consecutive year of growth” for European NATO members and Canada. That again takes us back to 2014.
As for the $130 billion extra that Trump falsely claims he has collected, once again we must emphasize this is money that each country is spending on its own defense. It does not go into a pot for NATO’s use, though better-funded militaries might enhance NATO’s competitive edge.
The $130 billion is an estimate for cumulative defense spending through 2020, in 2015 dollars, as an increase over 2016 spending. Trump frequently suggests that it has been spent already.
Meanwhile, the $400 billion mentioned by Trump is a cumulative figure through 2024. But Trump adds the two numbers together to come up with a fanciful $530 billion: “So it’s a total of $530 billion other countries will be putting into NATO.”
Another chart in NATO’s Nov. 29 communique makes it clear that Trump’s math is faulty:
Even more absurdly, Trump claimed in a tweet Dec. 8 that the gain in NATO spending will be $530 billion more a year; it’s really $400 billion over eight years.
In any case, the NATO guideline for each nation to spend 2 percent of a nation’s gross domestic product on defense is rather arbitrary, especially for smaller economies. Bulgaria leapfrogged into meeting the guideline in 2019 because of a $1.67 billion deal to purchase eight F-16 fighter jets from the United States. Greece was able to meet the guideline mainly because its economy collapsed, shrinking its GDP, not because of any big defense increase.
The United States, of course, has global responsibilities that extend well beyond the NATO alliance, so it’s difficult to calculate how much of overall U.S. defense spending is devoted exclusively to NATO.
The Pinocchio Test
Perhaps in Trump’s fourth year as president, he will finally understand NATO financing. But in the meantime, he continues to offer a parade of misleading statistics and claims.
NATO already was boosting defense spending before Trump arrived on the scene; it was not going down as Trump claims. NATO members do not owe money to NATO or the United States but are boosting spending for their own defense. And NATO members are expected to spend an additional $400 billion by 2024, not $530 billion (a year!) as Trump claims.
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