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Distorted NATO Funding Figure

The United States does not pay 80 percent of the cost of operating the North Atlantic Treaty Organization, or NATO, as President Donald Trump claimed.

The U.S. spends a lot more on its own defense compared with other nations in the international security alliance, but its share of the commonly funded NATO budget is less than one quarter.

Trump, who has long complained that other members of NATO should be spending more, made his claim during a speech in Pensacola, Florida, where he took credit for getting NATO countries to spend more money on defense.

Trump, Dec. 8: Now tomorrow morning you’ll see from these fakers back there, Donald Trump again disrespects NATO. I don’t disrespect NATO. I think NATO is wonderful. But you know what? We’re paying for 80% of NATO – could be higher. They say 72%. So, we’re paying for 80% of NATO. Now I can only tell you one thing – it helps them a hell of a lot more than it helps us, okay?

Trump conflates two kinds of spending by NATO countries — direct and indirect – to wrongly claim that the U.S. is “paying 80% for NATO.”

As for direct costs, the U.S. currently pays about 22 percent of NATO’s “principal budgets” that are funded by all alliance members based on a cost-sharing formula that factors in the gross national income of each country. The principal budget categories include the civil budget, the military budget and the NATO Security Investment Programme.

“Direct contributions are made to finance requirements of the Alliance that serve the interests of all 29 members — and are not the responsibility of any single member — such as NATO-wide air defence or command and control systems,” NATO says. “Costs are borne collectively, often using the principle of common funding.”

Direct spending may also include other “joint funding” projects that are arranged by participating NATO countries, but that are still overseen politically and financially by NATO.

“Jointly funded programmes vary in the number of participating countries, cost-share arrangements and management structures,” NATO says.

Trump, on the other hand, is referring to so-called indirect spending — that is, the amount that the U.S. willingly spends on its defense budget compared with what other NATO countries spend on theirs.

In its June 2017 update on spending, NATO said: “Today, the volume of the US defence expenditure effectively represents 72 per cent of the defence spending of the Alliance as a whole.” That disparity “has been a constant,” NATO says, and has only grown since the U.S. began increasing its defense spending after the terrorist attacks on Sept. 11, 2001.

The 29 alliance members together spent an estimated $946 billion on defense in 2017, and more than $683 billion of that amount was spent by the U.S.

Trump, however, mischaracterized what that means.

As NATO said in the June update: “This does not mean that the United States covers 72 per cent of the costs involved in the operational running of NATO as an organisation, including its headquarters in Brussels and its subordinate military commands, but it does mean that there is an over-reliance by the Alliance as a whole on the United States for the provision of essential capabilities, including for instance, in regard to intelligence, surveillance and reconnaissance; air-to-air refuelling; ballistic missile defence; and airborne electronic warfare.”

In 2006, NATO members agreed to try to spend at least 2 percent of their gross domestic product on defense spending. In 2014, they agreed again to aim to meet that standard by 2024.

As of now, though, only the U.S., Greece, Estonia, Britain, Romania and Poland meet the 2 percent target, which led Trump to argue that our allies are not paying their “fair share.”

But other countries have been spending more in recent years. The estimated 4.3 percent bump in 2017 was the third straight year that defense spending by Canada and European allies increased, according to NATO.

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2017-12-14 20:47:05 UTC

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Distorts the Facts
“I think NATO is wonderful. But you know what? We’re paying for 80% of NATO – could be higher.”
Donald Trump
President of the United States

Pensacola, Florida
Friday, December 8, 2017