Just The Facts: Financial Facts on NATO and the U.S.

The Fulcrum strives to approach news stories with an open mind and skepticism, striving to present our readers with a broad spectrum of viewpoints through diligent research and critical thinking. As best we can, remove personal bias from our reporting and seek a variety of perspectives in both our news gathering and selection of opinion pieces. However, before our readers can analyze varying viewpoints, they must have the facts.

In early March, President Donald Trump once again called into question a fundamental principle of the NATO security alliance: that an attack on one member of NATO is an attack on all nations.

In a bill signing meeting in the Oval Office in February, President Trump said he would reconsider the U.S. commitment to the security pact if members in the 32-nation alliance do not increase defense spending as he has repeatedly demanded.

“Well, I think it’s common sense,” Trump said. “If they don’t pay, I’m not going to defend them.”

Those supporting the United States’ commitment to NATO argue that the defense of democracy in Europe is vital to the security of the United States and that the U.S. role in NATO deters Russia from pursuing aggressive and illegal actions.

However, many in the Trump Administration argue that the financial burden is too great and that membership could potentially draw the U.S. into a conflict that is not aligned with our interests. Additionally, Trump has suggested that NATO expansion and activities actually escalate tensions.

This is a clear departure from the United States’ commitment to NATO, which has existed since its founding in 1949.

In light of the debate about NATO, The Fulcrum presents:

Just The Facts: Financial Facts about NATO and the United States

What percent of NATO's budget does the U.S. pay?

The United States is the largest contributor to NATO's defense spending, accounting for approximately 16% of the total expenditure as of 2024.

How does this 16% contribution by the United States compare to the size of the U.S. economy versus Europe’s?  

The 16% U.S. contribution to NATO’s direct budget is modest compared to the relative size of the U.S. economy versus Europe's.

• U.S. GDP (2024): approximately $29 trillion, representing about 25% of the global GDP.
• European Union GDP (2024): roughly $19 trillion, representing around 15-16% of the global GDP.

Thus, the United States contributes about 16% of NATO’s budget, despite having an economy that is approximately 55% larger than the EU's.

What is the NATO agreement on member countries' defense expenditures?

In 2014, NATO Heads of State and Government agreed to commit 2% of their national Gross Domestic Product (GDP) to defense spending, helping ensure the Alliance's continued military readiness. Additionally, NATO members agreed that at least 20% of their annual defense expenditures should be dedicated to major new equipment, including associated research and development. This guideline is intended to ensure the modernization and effectiveness of their armed forces.

In 2024, did the United States pay more to NATO as a percentage of its GDP than any other nation?

The exact amount each country paid to NATO could not be found. However, in 2024, the United States paid 3.38% of its GDP to on total defense, Poland paid 4.12% and Estonia paid 3.4% of their GDP on total defense, but this does not directly related to the percentage spent just on NATO

In 2024, what % of their GDP did France, England, and Germany pay?  

Germany paid 2.12%, France paid 2.06%, and England paid 2.33%.

Have NATO countries agreed to increase their share of funding?

Yes, NATO countries have recently agreed to increase their defense spending commitments.

NATO members have made significant strides in meeting the 2% GDP defense spending target, and in 2024, NATO Secretary General Jens Stoltenberg announced that a record 23 of the 32 member states were meeting the defense spending target of 2% of their GDP. Ongoing discussions aim to further increase these commitments in response to current security challenges. However, consensus on higher targets, such as 3.5% or 5% of GDP, has yet to be reached, with debates continuing on the feasibility and definition of defense expenditures.

To meet these higher targets without imposing undue financial strain, NATO leaders are considering redefining what constitutes defense spending.

Has the United States directly supported Europe through NATO in conflicts in the last 30 years?

Yes, the United States has supported European countries in conflicts through NATO over the last 30 years. Some notable examples include:

• Bosnia and Herzegovina (1992–1995): The U.S. led air strikes in Operation Deliberate Force and contributed significantly to peace enforcement through IFOR and SFOR missions.
• Kosovo Conflict (1999): The U.S. played a significant role in NATO's intervention during the Kosovo War, conducting airstrikes to halt ethnic violence and ensure stability.
• Libya (2011): Provided crucial support in the form of aerial reconnaissance, refueling capabilities, logistical assistance, and strategic command.
• Ukraine Crisis (2014-Present): The U.S. has bolstered NATO's Eastern Flank by deploying troops and equipment to support European allies in response to Russia's actions in Ukraine.

Did Europe support the U.S. in Afghanistan after 9/11?

Yes. After the September 11, 2001 attacks, NATO invoked Article 5 (collective defense clause) for the first time in its history, declaring an attack against one ally as an attack against all. This marked an unprecedented demonstration of European solidarity and unity with the U.S.

Europe strongly backed the U.S. after 9/11 through NATO, providing troops, resources, and financial support, and sustained considerable losses in Afghanistan for nearly two decades. This collaboration represents one of the most significant examples of European-U.S. cooperation under NATO.

David Nevins is co-publisher of The Fulcrum and co-founder and board chairman of the Bridge Alliance Education Fund.