Europe faces a painful adjustment to higher defence spending

With vladimir putin issuing threats and Donald Trump musing about withdrawing support, everyone agrees that Europe needs to spend more on its armed forces. What is less widely recognised is how wrenching the shift will be for a continent that has grown used to outsourcing its defence to America. Over the past three decades, politicians have enthusiastically spent the peace dividend on everything bar pilots, sailors and soldiers (see chart).

Some European leaders are already making commitments. Germany has created a fund of €100bn ($108bn) to bolster its armed forces and aims to meet the nato target of spending at least 2% of gdp on defence immediately. In France Emmanuel Macron has promised to reach the target this year. Compared with their pre-pandemic average, the continent’s NATO members (and Canada) have already increased defence spending by about 0.26 percentage points of GDP, together hitting a new average of 1.7% of gdp last year.