Can Europe stand without the US?

0:01NPR.

0:11This is The Indicator from Planet Money. I'm Paddy Hirsch. And I'm Adrian Ma. This week, more evidence surfaced of the Trump administration's axe to grind with Europe. It came from a leaked group chat with texts from Vice President J.D. Vance and Defense Secretary Pete Hegseth. In this conversation, they're discussing whether to launch a military strike on Houthi rebels in Yemen, which have been disrupting commercial shipping in the Red Sea. Vance said he just hated, quote, bailing Europe out again, unquote. Hexeth replied, quote, I fully share your loathing of European freeloading. It's pathetic, unquote.

0:47All of this means that things are getting real in Europe. If Europe wants to avoid war, Europe must get ready for war. This was European Commission President Ursula von der Leyen speaking at the Royal Danish Military Academy last week. At the same time, European leaders were working on a rearmament plan aimed at decoupling Europe from the U.S. and lowering its reliance on America for weapons and security. So today on the show, we'll ask what Europe needs to do to stand alone militarily without America, how long that might take, and what the barriers could be. That's coming up after the break.

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2:05You get a dedicated partner that provides you a powerful combo of checking and card payment processing with quick access to the money you've earned, proving that there is nothing as powerful as the power of us. Visit usbank.com today to learn more. Member FDIC. Copyright 2025 U.S. Bank. As we've reported before on this show, U.S. administrations, at least as far back as George W. Bush's, have been pushing European nations to increase their defense spending. But throughout, the U.S. has remained committed to the principle of NATO's Article 5, which says that an attack against one ally is considered as an attack against all allies.

2:46That commitment appears to have ended with President Trump. Well, I think it's common sense, right? If they don't pay, I'm not going to defend them. No, I'm not going to defend them. I got into a lot of heat when I said that. You said, oh, he's violating NATO. And you know, the biggest problem I have with NATO, I really, you know, I mean, I know the guys very well. They're friends of mine. But if the United States was in trouble and we called them, we said, we got a problem, France. We got a problem. Couple of others I won't mention. Do you think they're going to come and protect us? They're supposed to.

3:25I'm not so sure. For the record, Article 5 of NATO has only ever been invoked once, and it was by the United States. Bronislav Slanchev teaches military and war studies at the University of California, San Diego. When Article 5 was invoked after 9-11, the Europeans responded. Canadians, they went and they died. The British went and they died. Everybody responded. That includes the French, by the way, who supported the U.S. by sending troops to Afghanistan, 89 of whom died and more than 700 of whom were wounded. Trump's public scorn for these sacrifices is just one barb on the arrowhead that has pierced the heart of the European-American relationship and shredded trust between them.

4:07And it's galvanized European governments to make themselves independent of the U.S. when it comes to their defense. But Fenella McGurdy says Europe was already ramping up its defense spending long before Trump came into office. Fenella is a senior fellow for defense economics at the International National Institute for Strategic Studies in London. In 2024, we saw record defence-bending growth already, 11.7 % in real terms. And that was itself an increase, so an acceleration from the level of growth we saw in 2023, which reached 5.2%. And that was an acceleration from the growth the year before.

4:44The EU plan announced last week will likely break new records. It advocates a massive ramp-up of defense industrial production capacity, and it unlocks a combined$866 billion in military spending over four years. That's about what the U.S. spends in a single year on defense, so Branislav says it's not even close to a conversion to a war economy, but it could still be good medicine for Europe. The European manufacturing base is astonishing. It can produce high-precision machinery. It has all sorts of talent. If it's done right, it should generate economic benefits for these countries. And so that should alleviate some of the problems that Europe has been struggling with.

5:23Governments will be pumping money into building factories and strengthening manufacturing. It could mean a boom for companies in those sectors. Hopefully, lots of new jobs. But to come up with that funding, countries are going to have to make some hard choices, Fenella says. In fact, in some cases, they already are. It's requiring countries to incur more debt. It's requiring restructuring of debt laws. Germany just last week approved an historic change to its debt laws, allowing it to borrow more for defence. Denmark did similar, and other countries seemed likely to follow suit. All of this, of course, could balloon deficits and stoke inflation.

6:00But even if European governments do manage to pull a Goldilocks and get their borrowing and their spending just right, there are still plenty of other challenges to building out a coherent defence. Arguably, Europe can increase the funding, they can increase the money, they can incur more debt, but it's the capacity of European defense industry to then respond to that increase of demand. Because the defense industry has been run on a lean outlook. It was very much all about efficiencies, targeted production runs, no stockpiling. Right now, the U.S. dominates Europe's military supply chain. It provides rocket launcher systems and artillery shells and fighter jets to European forces.

6:40Yeah, and to wean themselves off America, the EU's 27 nations and 27 armies will have to find new suppliers of equipment and ammunition. Some of those suppliers will themselves be European, but others will come from overseas. The whole process of coordinating who makes what and when and for whom will be complicated. It will really be key to ensure that there is that cohesion across Europe and including countries that aren't in the EU, looking at how to work with NATO, coordinating the demand across industry to make sure that everyone isn't demanding the same thing at the same time, creating competing demands for the same resources and creating those further supply chain issues.

7:20So it's one of the issues at the moment as well. And no matter how much money Europe throws at the ramp up of its defence capacity, the creation of these new supply chains and production lines won't happen overnight, Branislav says. So it will be years. These are all future investments that will take two to three years to start seeing some significant changes, for sure. The military strategists now are spending a lot of time trying to figure out exactly where these investments need to be made. Which is no easy task. The military threat from Russia is very different to what it was just five years ago, and it keeps changing.

7:53Branislav says that means Europe needs to adopt new technologies and wean itself from old ones, even those that have required considerable investment in the past. Everything is changing right now. This current war, things have evolved dramatically. Initially, for instance, everybody was talking artillery and tanks. That was a big thing. then the tanks turn out not to be super effective. Now everything is drones and the missiles, right? And everything then is related to how you can keep electronic warfare from the interference. Do you have eyes in the sky, so the satellites? So these are the kind of capabilities.

8:25We should not be building to fight the last three wars. We should be building to fight the next one. Europe can do all sorts of things to move quickly, or at least more quickly than it usually does. It can convert old factories to make arms and reconfigure existing ones to become dual-use civilian and military production hubs. It can develop supply relationships with other arms providers like South Korea or Israel. But whatever it does, it'll take time, Fenella says. And because of that, the U.S. will likely remain part of the European defense equation for the foreseeable future. It takes decades for a lot of these programs.

9:01So I think that there's some level of dependence will always be there, certainly in things like heavy lift transport and things like that, because those capabilities do take time to develop. And I think Europe could get there, but not in perhaps in the timeframe it needs. So there's always going to be that some level of reliance on the US and hopefully some partnerships going forward, which ultimately is good for US defence industry as well. Partnerships. Because in future, it won't just be Europe relying on the US. America's withdrawal from Europe is part of a pivot to Asia that began under the Obama administration.

9:34Whether President Trump likes it or not, as the U.S. continues to square up to China, it will need allies. It will need Europe. Just as it did after 9-11, when it asked for help and got it. This episode was produced by Cooper Katz McKim and engineered by Jimmy Keely. It was fact-checked by Sierra Juarez. Kicking Cannon edits the show in the indicators for production of NPR.

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