What’s really behind Europe’s 5% defense push

Summary

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EU Confidential

Episode: What’s really behind Europe’s 5% defense push

Release Date: June 20, 2025
Host: Sarah Wheaton (POLITICO)

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Overview

This episode focuses on the European debate around dramatically raising defense spending to a new NATO target of 5% of GDP — a significant jump from the long-standing 2% goal. As the NATO summit in The Hague approaches, POLITICO explores the pressure on European governments to act, the economic and political trade-offs, the underlying motivations behind the push (including pressure from the U.S. and Donald Trump), and alternative visions for European security—especially from politicians in Belgium and Germany who challenge the new status quo.

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Key Discussion Points

Setting the Stage: Why a 5% Defense Target?

• Host Sarah Wheaton introduces the main questions: Why is the 5% target being proposed now, is it realistic, and what could it cost European societies?
• Mark Rutte (NATO Secretary General) recently argued that Europe needs to spend "considerably more than 2%" on defense — despite the political difficulty of shifting money from social programs to military budgets.
  • Notable quote: “2% is not nearly enough to stay safe... allies will need to spend considerably more than 2%.” — Mark Rutte [00:31]

The Underlying Dilemma:

• Host frames the debate as "tanks versus pensions" or "guns versus butter:"
  • Where will the money come from for this defense surge?
  • Are cuts to pensions, schools, and healthcare acceptable trade-offs for security?
• High stakes heading into the NATO summit, with war in Ukraine ongoing, and security concerns in Gaza and the Middle East [01:26].

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Expert Analysis: Michelle Haas (Defense Analyst, Ghent University and Egmont Institute)

[04:10–16:42]

Origins and Mechanics of the 5% Target

• The 5% figure includes both military and defense-related investments; the "real" core increase for actual defense hardware and capability is about 3.5%, with 1.5% potentially covering infrastructure, cyber, and resilience.
• The post-2014, post-Ukraine context led to the 2% goal, but more recent defense planning highlighted greater capability needs.
• "We knew that a bigger jump of the NATO norm was coming up. A lot of analysts expected something around 3, 3.5%. So that is actually the new NATO norm. We can call it the 3.5%. And the 5% also includes this 1.5% of defense-related investment.” — Michelle Haas [04:55]

Is the 5% Push Just Donald Trump’s Idea?

• Trump’s pressure has accelerated the push, but even a different U.S. administration would have led to higher European defense spending, due to structural NATO military shortfalls since 2022.
  • “Diplomatic pressure has actually become the decisive factor pushing them to ramp up defense spending.” — Michelle Haas [06:28]
• Ultimately, the 5% is as much Europe’s plan as the U.S.'s.

Will All Countries Fall in Line?

• Almost all NATO members are expected to endorse the target “on paper,” but real implementation is questionable, especially given domestic politics and fiscal constraints.
  • Some states (Spain, Belgium, Italy) struggle just to hit 2% and face big obstacles ramping up.
  • It’s a “growth trajectory” rather than an immediate demand, with no set annual target yet.

The "Guns vs. Butter" Debate Is Too Simple

• European states have more than a binary choice; different paths include:
  1. Raise taxes (e.g., Estonia’s defense tax)
  2. Increase debt (e.g., Poland, which massively ramped up defense via borrowing)
  3. Reallocate existing spending
  • Domestic politics and fiscal culture shape national responses.
  • “For Nordic and Eastern European countries, they view... military spending as a way to preserve the social system, something not really felt in some parts of Western Europe.” — Michelle Haas [09:29]

National Threat Perceptions & Strategic Communication Matter

• Proximity to Russia shapes urgency: “countries that are closer to Russia have been much more willing to boost their defense spending and really do whatever it takes...”
• But history, political culture, and even specific events (like the MH17 crash in the Netherlands) play a big role.

Belgium as a Case Study

• Belgium has low threat perception, high taxes, and high debt, making defense increases politically toxic.
• Haas notes: “Even going beyond [2%], which they now will agree upon at the NATO summit, will prove to be a big challenge.” [13:11]
• Lack of democratic debate and deep political resistance, especially from Christian Democrats and French Liberals.

Is the 5% Goal Real or Just Theater?

• Haas predicts a gap between “discourse and action.”
• The industrial angle: Deepening partnerships with Ukraine—including defense industry ties and readiness—will be key.
• “The best deterrence for Europe is to help Ukraine survive and to work together with Ukraine...” — Michelle Haas [15:36]

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Center-Right Response: Sami Mahdi (Chair, Flemish Christian Democrats, Belgium)

[18:27–32:36]

Skepticism Toward 5% and Alternative Proposals

• Although Belgium's government backs the goal, Mahdi calls 5% “crazy,” pointing out that Europe already vastly outspends Russia:
  • “If you look at... NATO, right now, we spend 1,500 billion euros on defense. The EU, 450 billion. If you compare that to our biggest threat right now, Russia, they spend $150 billion.” — Sami Mahdi [19:49]
• Argues for efficiency and cooperation over raw expenditure:
  • "We have 178 different types of weapon systems in the EU; we have 17 types of tanks; the US only has one. ...With the same amount of money, we could do way more than we’re doing right now." [21:17]
  • Proposes a European defense industry/European army, addressing inefficiency and sovereignty tension.

The Danger of Political Extremism

• Warns that heavy investment in national militaries without coordination could backfire if “extreme right populist” parties take power.
• “I would prefer to make sure that with all the European countries, we shake hands... and we make sure that we work towards European defense.” [22:12]

Solidarity & Fairness

• Draws a parallel to migration debates, noting the need for burden-sharing:
  • "There is a question about solidarity regarding defense. Bottom line, I think both are right. And the only way to make sure that you have that kind of solidarity is by working together." [23:58]

The Need for EU Defense Industry and Strategic Alignment

• Advocates for an “Airbus-style” defense approach: EU-wide design and procurement rather than fragmented national systems.
  • “...the only way to move forward towards finally a European army...” [25:10]

Political Risks of 5%

• Large increase could threaten social programs and alienate voters:
  • “Investing 5% of our GDP in defense would mean €6,000 less for each family in Belgium.” [26:55]
  • "We could lose a lot of our citizens [politically] if the price of inefficiency is their Social Security, their pension, their purchasing power." [25:55]
• Warns of rising populism if social costs are too high.

Transparency and Debate

• Calls for honest public debate about what’s feasible and necessary, rather than political theater to please Washington or NATO.
  • “We should have an honest debate about it, and not just at the level of the NATO. Accept the 5% and then go back to our countries to ask ourselves the question, how on earth are we ever going to make the 5%?” [31:57]

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Center-Left View: Ralph Stegner (German Social Democrats, Bundestag)

[32:43–43:52]

The SPD Peace Manifesto & Opposition to Rearmament

• Stegner co-authored a public letter opposing Germany’s planned 500 billion euro defense increase and calls for redirecting resources to poverty eradication and climate change.
  • Emphasizes the dangers of an “arms race” and pushes for renewed diplomacy, arms control, and negotiation — even as Europe faces Russian aggression.

Why Did Diplomacy Fail, and Can It Work Again?

• Admits recent diplomatic failures, but insists on exhausting peaceful options.
  • “There's no alternative to try... Everything really has to be tried, that we don't end up in arms race and wars.” [36:09]
• Meeting with Kremlin-linked officials is controversial, but Stegner defends contacts: “If you don’t have contacts, you don’t have influence.” [37:20]

Pushback Within Germany & EU

• The SPD Peace Manifesto is rejected by Defense Minister Pistorius as “denial of reality,” but Stegner points out the split between public and elite opinion.
  • “We have record high expenditures in military all over the world. And I think we don’t lack weapons. We lack the means and perhaps the political will to do something about the real problems…” [39:49]

The Numbers Don’t Add Up

• Warns 5% would mean “225 billion euros every year” — up from Germany's current 90 billion — potentially sacrificing education, welfare, and social stability.
  • “That’s almost an invitation for populist parties to give them the numbers they need to shake our stability in democratic societies..." [41:15]

What Does the Public Think?

• Despite elite criticism, Stegner cites polling that half of Germans support the manifesto.
• Stegner: “My generation is the first in my country to live in peace and prosperity and freedom. And I think we have the obligation to see that this is fate for our children and grandchildren as well.” [38:40]

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Notable Quotes & Moments (with Timestamps)

• Mark Rutte on Defense Priorities:
  "Allies will need to spend considerably more than 2%. I know spending more on defense means spending less on other priorities." [00:31]
• Michelle Haas on the Real Numbers:
  "The new NATO norm purely on defensive investments is actually 3.5%... the 5% also includes this 1.5% of defense-related investment." [05:00]
• Sami Mahdi on Military Efficiency:
  "We have 178 different types of weapon systems in the EU...with the same amount of money, we could do way more than we’re doing right now." [21:17]
• Sami Mahdi on Social Cost:
  "Investing 5% of our GDP in defense would mean €6,000 less for each family in Belgium." [26:55]
• Ralph Stegner on Prioritizing Peace:
  "We don’t lack weapons in the world. We lack the means and perhaps the political will to do something about the real problems... hunger, poverty, the environment." [39:49]
• Ralph Stegner on the Risk of Populism:
  "That's almost an invitation for populist parties... to shake our stability in democratic societies that are already under pressure." [41:15]

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Segment Timestamps

• Introduction & Host Framing: [00:31–04:10]
• Michelle Haas Interview: [04:10–16:42]
• Sami Mahdi Interview: [18:27–32:36]
• Ralph Stegner Interview: [32:43–43:52]

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Summary & Takeaways

1. The 5% defense spending target is seismic—but much of the increase is not hard military spend, and implementation will be slow, contingent, and politically fraught.
2. Trump’s pressure accelerated, but did not create, the push; even under a different U.S. president, Europe would have faced a reckoning on defense spending post-Ukraine.
3. Political and fiscal cultures shape how (and if) nations try to meet the target:
   • Some will use higher taxes, some debt, some budget reallocations.
   • Close-to-Russia countries more urgently accept spending increases, while distant ones debate the trade-offs.
4. Critics (Mahdi, Stegner) question both the necessity and efficiency of such a big increase, stressing European cooperation, defense industry development, and the political risk of sacrificing social stability.
5. Underlying public opinion is split—polling suggests concern about both security and social costs—while political elites argue over the right balance.

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Overall Tone:
Balanced, analytical, occasionally skeptical, with emphasis on nuanced debate over simple slogans; the show features direct, candid critiques alongside policy wonks' detailed explanations.

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Transcript

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Like a Kenneth Cole suit made with Shellflex fabric to keep them cool at their cousin in law's third wedding in the middle of July. Whatever the thing, Men's Wearhouse has the clothes for it. Love the way you look. Men's Warehouse 2% is not nearly enough to stay safe in the years to come, allies will need to spend considerably more than 2%. I know spending more on defense means spending less on other priorities.

[C]

If you do not want that's NATO Secretary General Mark Rutte earlier this year making case to European lawmakers for spending more on defense than they might normally be comfortable with or than they can afford, based on their current priorities.

[A]

On average, European countries easily spend up to a quarter of their national income on pensions, health and Social Security systems. And we need only a small fraction of that money to make defence much stronger.

[C]

Depending on who you ask, he's either oversimplifying the debate, talking about tanks versus Pensions or guns versus Butter, or he's cutting straight to the heart of it. Because, let's be honest, when you propose to double or even triple what governments currently spend on tanks, jets and military infrastructure, two big questions come up. Where is that money going to come from? And why should taxpayers accept certain cutbacks on pensions, schools and hospitals in order to prepare for hypothetical threats from some faraway place? The NATO summit in the Hague is just days away, and it's happening against the backdrop of the war in Ukraine, ongoing violence in Gaza, and bombs falling in Israel and Iran. The spending target on the table is steep 5% of GDP. And look for countries like Germany and Belgium that have been struggling with the current 2% target. They're going to face some serious political and budgetary headaches. So what might we have to sacrifice? Sacrifice? When defense spending soars, do we actually need to spend more to fend off Russia? Or are there other options? Are European countries actually going to go through with a transformative military buildup? Or are they just paying lip service to Donald Trump? I'm Sarah Wheaton, host of EU Confidential. Later in the episode, we'll talk to Belgian politician Sami Madi, head of the Flemish Christian Democrats and part of the country's ruling coalition. The federal government in Brussels is backing the 5% defense spending goal. But Mahdi, he's not convinced and has publicly called the idea insane. Ralph Stegner, a senior member of the German Social Democrats in the Bundestag, is also not sold on this idea. He advocates for more focus on an even cheaper approach, diplomacy. He will also zoom in from Berlin. But first, to help us get the lay of the land, let's welcome Michelle Haas. She's a defense analyst at Ghent University and an associate fellow at the Egmont Institute. With alliance members likely to formally endorse the 5% target at next week's NATO summit, Haas has been looking into how countries might actually spend this extra defense budget line and how they might pay for it. So let's start with what's on the table. At the summit in the Hague, NATO leaders are expected to endorse a new 5% of GDP spending goal for defense. That's a huge jump. Some countries are only barely just now making that 2% point. Can you tell us what exactly is being proposed?

[D]

So it is a big jump. But this debate didn't emerge out of nowhere. We have to go back to 2022. At the NATO summit in Madrid, the allies were tasked with developing new collective defense plans. And a year later, in 2023, in Vilnius, the summit, those plans were approved. And basically what happens after that is that they come up with capabilities that are needed to fill in those defence plans and then divide them over capability targets. Now in 2025, the question is more about funding. So how do we pay for these capabilities that we have put forward for the defence plans? And yeah, the baseline is clear. It's territorial defense is back and readiness among all the components. And for a lot of European states have been neglected for a long time. So that needs higher budgets and it needs more capabilities. So we knew that a bigger jump of the NATO norm was coming up. A lot of analysts expected something around 3, 3.5%. So that is actually the new NATO norm. We can call it the 3.5%. And the 5% also includes this 1.5% of defense related investment, although it's still not really clear what is among those investments. Infrastructure, roads and railways that can support military mobility. Stuff like cybersecurity. But what is less clear, for example, domestic security resilience measures, will they also fit in the 1.5%. But the new NATO norm purely on defensive investments is actually 3.5%. And yeah, it's kind of in line what we could have expected based on those collective defense plans.

[C]

So a lot of people have been saying that this is kind of Trump's plan. Is that fair to say? Or would this have happened even if Kamala Harris had won the presidential election in the U.S. it's a good question.

[D]

Of course, there's some pressure that comes from Donald Trump. So yes, Trump plays a role because we've seen this year that the so called free rider countries that didn't even keep up with the NATO norm of 2% that was agreed upon in 2014. So countries like Spain, Italy, Belgium, they didn't shift because of threat perception, because they saw Russian threat as very urgent since 2022. But diplomatic pressure has actually become the decisive factor pushing them to ramp up defense spending. So of course, it is also partly due to pressure of Trump. But I think we could say that even with another US administration, it was clear that Europe needed to spend more to fill in those capability targets needed for the collective defense plans. So maybe it's going a bit faster. And I think specifically the 5% communication is also partly pushed by Trump to give the US Actually this big announcement that they have made a deal going to 5%. But then if we look closer at it, it's actually the 3.5% that is defense investments. But it's not Trump's plan, it's actually Europe's defense plan. In that sense, I think it would have actually been the same.

[C]

And how many countries are kind of getting on board with this plan? Like you said, there are some laggards who have felt the pressure. Are they all going to, at least on paper, say they're going to get to this 5% point?

[D]

Yeah, what you say is good. I mean, yes, on paper they will agree with it. The question is, of course, what will happen after the summit and will the countries just politically supported, but not actually implemented in terms of national defence policies? Because it does ask a lot of policy reforms in many countries to actually implement this high of an increase. So we know that almost all NATO members, European countries have agreed to go to 5%. But we hear strong pushbacks from countries like Spain, but it remains unclear whether their government is actually willing to put this into national policy reforms and actually increase the defence budgets in the upcoming years. It also Depends, of course, on the timeline. So it's not that NATO will ask to spend 3.5% by tomorrow. It's a new growth trajectory that is agreed upon. And what is also important to look at is whether or not there will be some sort of structured increase needed every year to show to NATO that you are increasing, for example, 0.2% each year. That actually requires more from nation states.

[C]

Indeed, those policy changes that you mentioned could be a huge sticking point domestically. You know, we've even heard NATO chief Mark Rutte, former Dutch prime minister, he put it pretty bluntly recently. He said, if you want more security, you might have to spend less on social programs. Some people are calling this the tanks versus pensions debate, the guns versus butter dilemma. But you said those are, those are too simplistic. What are the actual options that countries have?

[D]

Indeed, it's often referred to as this classic guns versus butter debate. So basically suggesting that governments have to choose between social spending or military spending. You see that in today's context, where it's about a threat, either hybrid or conventional, to state security or even state survival. For Nordic and Eastern European countries, they view this way differently. And they say that military spending is actually viewed as a way to preserve the social system, something that is not really felt in some parts of Western Europe. Basically, governments face tough fiscal choices, but they have more options than either choosing between social spending or military spending. There are in general, three main ways to create fiscal space. Either raising taxes. You've seen that in countries like the Baltic states. For example, Estonia introduced something like that, comprehensive defense tax. The second option is issuing additional debt. Of course, Poland is a standout case. Its defence spending rose from like 2.2% in 2022 to about 4.7 or going to 5%. This expansion is largely being financed through new public debts. Then you also see other countries like Germany, France, Italy, Bulgaria, where you have seen this trend of mainly financing it through new debts. And then the third option is reallocating resources. And that's mainly done by countries that prioritize fiscal discipline, like the Netherlands or Denmark. So they try to reallocate within their own budgets. So, yeah, it depends. The European countries have taken different approaches to it, but of course there are new challenges and new trade offs when the defence budget norms are increased for the upcoming years.

[C]

Yeah, well, indeed, there's definitely not a one size fits all. And it seems to depend on kind of the political culture and values of those countries combined a bit with the threat assessment. And indeed a theme we've talked about consistently on this podcast is how countries that are closer to Russia have been much more willing to boost their defense spending and really kind of do whatever it takes to get to that point. Whereas countries more in Western Europe, the threat feels a bit more abstract. And so likewise, are you sort of seeing different persuasion strategies from leaders who do want to move forward with this spending?

[D]

Yes, a bit. So we've actually done a big research on threat perceptions among European states and how they have changed in response to the war. It's not all geography. So you see, for example, that the Netherlands and Belgium have different threat perceptions. It's also based on historical events such as the MH17 crash in the Netherlands and the fact that they have been more transatlantic, international, more based on alliance solidarity in this sense. So it depends. It's not all threat perception, but of course it is a key element to strategic communication, something that has been also neglected in a lot of European states, which is kind of key to implementing these big defense reforms because you need support from the public. And for countries that have a higher threat perception, this is more easy to explain to the public, while for other countries it's very difficult and also depends on the fiscal system and so on. In Belgium, it's quite difficult with high taxation, high depth and low threat perception and, and also low starting budget. So the defence budget this year was actually 1.3% of GDP and then they have announced to increase it to 2% this year. So that's already a big jump. And even going beyond that, which they now will agree upon on the NATO summit will prove to be a big challenge.

[C]

Yeah, speaking of Belgium, it's been one of these free rider countries, the second lowest spender in NATO. As far as the threat perception, it did always surprise me a bit. I've been living here eight years. I was certainly here during the full scale invasion and we did all rush out and get our iodine tablets in case there was a nuclear attack. But they were also kind of dark jokes of like, well, NATO is right around the corner, the EU institutions, Putin picks the target. Like we're pretty prime one. So why is there this disconnect between, let's say I have been thinking, and kind of the country's threat perception.

[D]

Yeah, I mean, the political debate right now in Belgium is mainly surrounding the idea that there has been no democratic debate on the 5% norm and that even a lot of majority political parties are proactively positioning themselves against increased defence budgets. So it's Christian Democrats, but also French liberals that have said it's collective Hysteria, I think it's a combination of things. You have political ideology, so. So having opposed defence spending for so long, it seems like a very big shift to make for a lot of political parties. It's also party political game, so there's a low sense of urgency amongst the society. Although polls show that Belgium are aware of these geopolitical threats, but the answer is not truly clear. In the Netherlands, for example, they had this parliamentary debate this week as well, and there was actually a broad majority, even like the Greens and Social Democrats, that support the 5% norm. And there they debate, okay, how are we going to finance it? And then you see, of course, political differences. But here you see, like step one, agreeing on the threat is something that's still debated.

[C]

And then, last question, stepping back to look at NATO more broadly again. I mean, we talked about the potential for this sort of mandated stair step of increasing spending. Beyond that, what else might you be looking for when trying to answer the question of is this a real, this new 5% goal, like a real thing, or is it just sort of political theater to show Washington that Europe is getting serious about its own defense?

[D]

It's a lot about industry as well and about including Ukraine into the future security architecture of Europe, because actually the best deterrence for Europe is to help Ukraine survive and to work together with Ukraine in terms of their training and knowledge and industry and so on. Including Ukraine, that's going to be interesting to see how that plays out. But then mainly there of course, always been a big gap between discourse and action in policy. We've seen that in support of Ukraine, but also in terms of stepping up European defense. And this seems like one of the momentum to actually do so, because the transatlantic insecurity seems like a final push to actually come together as European states. So it will be interesting to see how that works out and whether we achieve strategic unity among European states, which has always been the main hinder or barrier to actually come up with a strong European defence.

[C]

We'll leave it there. Michelle Haas, thank you so much.

[D]

Thank you.

[C]

Okay, it's time for a quick break. When we come back, we'll hear two perspectives, one from the center left and one from the center right, who both argue that we should kind of tap the brakes on this whole military buildup thing. Stay with us.

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Shop the Ninja luxe [e-mail] so here in Brussels, we hear a lot of forceful voices for why Europe needs to do whatever it takes to support Ukraine. Last week we heard from one of them, Gabrielius Lansburgis, the former Lithuanian foreign minister. So this week we wanted to hear from people who think more money is not the best way to go. Sami Madi is the leader of the Flemish Christian Democrats, or cdnv, which is now a junior member in Belgium's governing coalition. At the EU level, his party sits with the European People's Party, the same center right political family as Lansburgis. Mari joins me here in the studio. So you're coming to us straight from the Belgian parliament. There's a debate going on about whether retirement savings should be exempt from the capital gains tax and indeed that's quite fitting since tax hikes might be the main way to find funds for more defense. Looks like there might be more debating ahead of you. The Belgian government, of which your party is a part, is backing boosting defense spending to 5% of GDP. I mean, I would assume you're for it if it's your government, right?

[A]

I think my party especially, but the government as a whole is still a bit skeptical about the 5%. When I became president of my party, I was the first to state that we have to get to the 2% as soon as possible. Belgium is one of the worst members of NATO. But now I'm also the one advocating the most to not get to 5%, because I think it's crazy. If you look at the budget of the NATO, right now, we spend 1,500 billion euros on defense. And the EU, 450 billion. If you compare that to our biggest threat right now, Russia, they spent $150 billion. So the question is not if we need to invest even more in defense. The question how are we going to make sure that we work closely together? I don't think that the citizens of the EU need to pay the price of a lack of efficiency of EU countries. If you want to make sure that you get your security, and if you want to make sure that we can guarantee peace to our citizens, then there's only one option. That's not the option of 5% or 7 or 10%, but that's the option of making sure that we work towards a European army. And that's why I'm very skeptical about the vision that is now being pushed forward by Trump.

[C]

Talk to me more about this European army. How would that work? And I mean, it would take money to pay for that too, right?

[A]

No, just look at the spending of the EU countries right now we have 178 different type of weapon systems. In the EU, we have 17 different types of tanks. The US only have one. So if you want to make sure that we work more together, with the same amount of money, we could do way more than we're doing right now. So that is why we need to work closely together. And then maybe another argument which is important to take into account. I think it's a good thing that countries of the EU invest in their defense. But the whole vision of the EU was about making sure that we have peace. But if you get into a situation where some European countries invest billions and billions of euros in defense and might have an extreme right populist party taking over, I don't know where we make sure that we have peace. If tomorrow in France you get an extreme right party in power, or in Germany or in any country of the eu, I don't feel safe about that. So I would prefer to make sure that with all the European countries, we shake hands, we work closely together, and we make sure that we work towards European defense.

[C]

Last week we had on the former foreign minister of Lithuania, who's always been a strong advocate for showing more defense against Russia. And his argument was basically Lithuania is one of the countries that is spending a lot of money because they're right on the front lines and they're basically subsidizing protection for countries like Belgium, like Spain, that are far away from Russia, but that benefit from this harder posture by other also kind of small countries.

[A]

Yeah, I mean, it's a bit ironic. I was State Secretary of Migration before being president of my party.

[C]

Easy job in Belgium.

[A]

Yeah, very easy job. And I remember how the debates were a bit different. Well, actually they were quite the same, but with different actors. And I mean, by that, that we in Belgium, we spend a lot of money on migration because we have a big migration influx, a lot of people coming in. While in some Eastern European countries you don't have a lot of migration pressure, so not a lot of expenses. And then there was also that debate, like, guys, we need to work closely together. It's impossible for Belgium to have that many expenses on migration. So we need more solidarity. And now there is a question about solidarity. Regarding defense, bottom line, I think both are right. And the only way to make sure that you have the kind of solidarity is by working together. Otherwise some countries will always be advocating for more and others will refrain in doing so.

[C]

So especially with worries that the United States will really retrench from NATO and not live up to its security guarantees, what is your vision for how a European. How the European Union should approach defense and how NATO should approach defense? Defence?

[A]

Well, regarding the eu, two aspects are extremely important. The first is having a European defense industry. I mean, if I would be president of the United States, I would advocate for 10%, assuming that most of the money that we need to invest or the most of the armies that we buy, we're buying them in the United States. So it's nice to have, for an American economy to have European countries having not 2%, but 5% of their money going to the military and going to American weapons. So that's the first one. We need to make sure that we invest in our own defense industry. And secondly, there not only should be European defense industry, but we need to have an Airbus strategy. We need to make sure that we have one kind of system that we develop in the whole of the eu. Because today, and that's often the biggest problem of the eu, you have the French companies who are advocating and lobbying for their systems, the Germans, the Italians, those of the uk and that's not helping us. So if you really want to make sure that the defense industry works, it needs to be on an EU basis with an EU strategy. And that's the only way to move forward towards finally a European army, which is really complicated because every country wants to have their layer of sovereignty. But if we work together on those aspects, I think we are evolving into the right direction.

[C]

And so you think that sticking to the 2% figure, but just kind of aligning everything better around Europe would allow Europe to make up for the US stepping away?

[A]

I don't know if the US needs to step away. We still hope, as members of the eu, but also members of the NATO, that the Americans can stay an ally of us. But yes, with 2%, you can do a lot. Should we do even more in Belgium? I think we have now a project going towards 2.5% of investing in defence. That's a first. And then again, you need to question yourself. How are we going to make sure that while investing in defence and doing it in an efficient way to make sure that we guarantee our security, in the same time, we're not moving towards investments in defense, which will have a cost on our Social Security? I mean, we could lose a lot of our citizens if the price of inefficiency is their Social Security, is their pension, is their purchase power. And that's where it might get frightening. There was a newspaper this week in Belgium which stated that investing 5% of our GDP in defense would mean €6,000 less for each family. In Belgium, when citizens hear that that's what's going to happen, you might lose them.

[C]

What do you mean by lose them?

[A]

I think for some extreme parties, especially extreme left parties, the Communists, who are advocating for the Russians and cheering for them, it is easy to have a form of opposition against what's happening, because there is a lack of debate in parliaments going on and there's a lack of efficiency that everybody clearly sees. And that's when it's easy to convince your citizens that the way other parties are going is not the right one. I'm a member of a Christian Democratic party of European People's Party. So if you want to be the party of the people, you need to make sure that you don't lose the people. And that's what we might see happening if we are going in this crazy direction.

[C]

But, yeah, I mean, what have you been hearing from your constituents? Are they worried about the war in Ukraine, about the threat of from Russia, or are they, yeah, more focused on kind of bread and butter issues?

[A]

No, no, no, they are worried about Russia a lot. And knowing that in my country we did almost nothing to invest in our military is one of the reasons. So everybody in Belgium knows that the fact that for decades we haven't invested in our military is a big, big, big problem. And so those investments are necessary. And most of the people really understand that it has to happen. So if you would ask Belgian citizens, do you think that we need to invest 2% of our GDP in defense? I think 90% would say absolutely yes. If you would ask them the question, should you invest 5%, and especially knowing that the consequences would be X or Y, I'm not sure that you get to 50%. Both aspects are important. There is the aspect of bread and butter, like you called it, and there's the aspect of security. And they can go hand by hand. There are political parties who state that it is impossible to invest in defense without making some sacrifices. There's only one sacrifice that you need to do, and that is a sacrifice of not thinking that as a country you can just manage your security by yourself. That's the only sacrifice that you need to do. And if you don't make that sacrifice, yes, your citizens will have to make a sacrifice.

[C]

Why do you think, as you mentioned, this 5% target was embraced by the government without much public debate?

[A]

I think there's a big pressure from the United States, There's a big pressure from some of the Eastern European countries, which I really do understand, because they see and feel the threat. There's also the question of trying to see how you get a better interpretation of 5%. And that's where the debate is going on right now. I mean, you get a debate where it's more the accountants who are trying to fix the 5% than really politicians. Let's see what we can put inside of the 5% to make sure that we do enough. So maybe if you put all of the things that we're not putting right now in our 2%, we can already say, surprise, surprise, we have 5%. But that's not making your country more safe. But unfortunately, that's where the debate is going on right now. But for a small country like Belgium, it is difficult to go to the NATO and say, no, let's be more rational. Let's work closely together. While you have some European countries who could benefit from the 5% on an economical level, and some who are and are rightly so scared of Russian threat, and for whom 5% is maybe not even enough.

[C]

And when you're talking about other European countries that could benefit, you're thinking of countries like, say, France that have big defense industrial, right?

[A]

Absolutely.

[C]

Kind of. On that note, you know, some people have said, maybe this is all just a bit of political theater. We tell Trump we're going to do the 5%, but as we've seen, countries like Canada, like Belgium, are kind of only just now getting to the 2% point. So is it okay to just kind of say, yeah, we'll do it, and hope he doesn't notice what happens next?

[A]

Is he listening or not? Let me try to answer as diplomatic as possible. Where Trump is 100% correct is that you need sometimes to push and put the pressure on some countries to make sure that they get to the 2%. So what he was able to do is get countries afraid of what might happen. And so now suddenly, some countries, like Belgium, is really quickly investing 2% in their defense, and that is thanks to the threat by Donald Trump. So that was helping. When will we be able to get to the 5% or the 3.5 plus 1.5%? I don't know. I think we need to evaluate step by step. And by evaluating step by step, maybe some countries, while facing reality, will be able to overcome their demands of sovereignty and will try to work more together than they are doing right now. The only thing I can say is that when talking with some of my colleagues from other countries, Belgium is not the only country where politicians are criticizing or asking themselves the question if 5% is really feasible and if it's necessary.

[C]

Yeah, you do feel like people need to be more kind of honest about this discussion. Sounds like.

[A]

Yeah, personally, I do. I think we need to be honest. And of course, I don't know if that's the most strategic choice to make. Maybe it's nicer to cover up what you think, but we should have an honest debate about it. Those topics have been discussed for the last decades without anybody ever thinking that it would be possible. And now, for the first time, it might be possible. But that's the reason why we should talk about it, and not just at the level of the NATO. Accept the 5% and then go back to our countries to ask ourselves the question, how on earth are we ever going to make the 5%? Because that's what's happening right now.

[C]

Sami. Maddy, we'll leave it there. Thank you so much.

[A]

Thank you very much.

[C]

Now let's head over to Germany. We've talked in the past about Chancellor Friedrich Merz's 500 billion euro security splurge paired with a special carve out for defense borrowing. That plan has been baked in for a while now, but lately it's proving divisive, facing rebellion even within Merz's own coalition. Our next guest is one of the leaders of that rebellion, Ralph Stegner, a senior Social Democrat and MP on the Budestog's Foreign Affairs Committee. He co authored a controversial manifesto opposing Germany's rearmament. Instead, he argues that money should be channeled into the fight against poverty and climate change. Stegner joins me from Berlin. You recently signed a public letter. It's referred to as the SPD Peace Manifesto. It's caused quite a stir in Berlin. It calls on Chancellor Mertz to dramatically change course in foreign and defense policy. That includes direct peace talks with Russia and an end to growing militarization. What was the message you were trying to send?

[B]

Well, the point is that we have terrible wars within Europe with the Ukraine war, the aggression through the Russians. We have the war in the near east, very bad situation in Gaza, western Jordan, also between Israel and Iran. And we have wars in different African countries in other parts of the world. And therefore, I think we should give a signal that it needs three being able to strengthen your own defense capabilities, trying to reach a return to arms reduction measures, and trying to open up a new phase of more cooperation rather than pushing up the military expenditures into regions that are really almost unbelievable and have no comparison in our history.

[C]

Why do you think we're at this moment where the response to kind of growing conflict is just sort of more conflict? I was even reading a headline the other day that said the age of nuclear disarmament is dead. What's behind this trend?

[B]

Well, I think that diplomacy hasn't been very successful in the last years. And diplomacy is also described as appeasement, as not understanding their military strength, as cooperating with dictators. Yet we have a situation in the whole world where many countries are led by dictators. It doesn't look like regime change would be the right methods, especially tried by military means. And therefore we have to deal with the ones that are there. And again, that doesn't mean giving up support for Ukraine or that doesn't lead to less expenditures in our own defense budget. To the contrary. Also, the talk about upcoming wars has become very frightening for many people. A lot of people are afraid that we turn into a period where war comes back.

[C]

Indeed, you said diplomacy hasn't really been working very well lately. You are advocating for engaging in peace talks with Moscow, but past efforts by European leaders and more recently by Donald Trump don't seem to have convinced Putin to stop the war. So what makes you think he's open to diplomacy at this point?

[B]

There's no alternative to try and as far as the diplomatic tries by Donald Trump are concerned, he's doing one thing in the morning and the other thing in the evening. And sometimes there are good things among those, but there's no strategy you could depend on. And also, I think whether one likes it or not, we would have to include other countries that may not share our views in different things, but we could have to work with, say, the countries of the global south, for instance, more efforts to join with them. Putting pressure on Putin would probably be a good idea. Also China. In China, we see only that many countries try to stress the conflicts they have with them rather than trying to work together, at least in a certain area, at least partly. And I think everything really has to be tried, that we don't end up in arms race and wars.

[C]

Is that part of why you met reportedly with officials close to Vladimir Putin who are under EU sanctions? You did take some criticism of that. And so can you explain why you engaged at this time when official contacts with the Kremlin are on ice?

[B]

I think it's always important to have contacts. If you don't have contacts, you don't have influence. So I don't think that I'm only one representative of the German parliament, but that doesn't make a big difference. But we need contracts with all countries, and if we don't have them, we don't have influence. And also, it's good to see what the other side thinks, besides, what you can get from their press propaganda, or what we get through our agencies that bring us news, we need to know. And the other side also should have an idea how we think. For instance, I think it's important for Russians to understand that Social Democrats are very much for diplomatic tries, but we don't at all share the view that you can invade in your neighbor country and trying to change borders with force. That's just not acceptable. And also, I don't see a real alternative to talking with each other. The only other thing, with the exception of talking, is shooting at each other.

[C]

That said, going back to the manifesto, it has caused quite a splash, as we said, but even in your party, it didn't seem to land that well. Defense Minister Boris Pistorius said it's close to mirroring Kremlin's propaganda and that it amounts to, quote, unquote, denial of reality. What do you say to those critics, including Pistorius?

[B]

I don't know whether it's denial of reality. If you see that we spend billions and billions of dollars and euros in military expenditures, and we spend the same billions and billions of dollars to build up again, Gaza, build up again Aleppo, build up again Ukraine, I don't think that's a reasonable development. And you can see all the dangers that go with that too. And therefore, we don't talk about the alternative to give up or to give in to dictators. But we need more efforts. See, my generation is the first in my country to live in peace and prosperity and freedom. And I think we have the obligation to see that this is fate for our children and grandchildren as well. And that's a difficult task, but you always have to try and discussion is something that belongs to our party culture.

[C]

Right. And Germany is expected to finance much of its defense buildup through borrowing. But you've warned that this could mean cuts to welfare. Is there any way to be safe from threats abroad and safe at home economically? Can we have both types of security at the same time?

[B]

Yes, we need the security, but look at the numbers. We have record high expenditures in military all over the world. And I think we don't lack weapons in the world. We lack the means and perhaps the political world to do something about the real problems that we have. And that is hunger, that is poverty, that is civil wars, the damage you do to the environment and all those people that flee from repression and dictatorships. We have to do something about that. But we see the contrary. The Americans cutting their aid, foreign aid, although it's needed more than ever. Instead of that, we spend more and more on weapons and always say, well, we never want the weapons to be used. Well, humankind and the history show that this doesn't happen.

[C]

Looking ahead to next week's NATO summit. You know, this episode of the podcast is focusing heavily on the 5% pledge that's expected to be adopted. But there are questions of how serious leaders actually are when they say they're going to try to meet these commitments. Do you expect to kind of just see people say, yes, we're going to. We're going to do the 5% and then not actually do it? Or do. Do you think that this is a really serious initiative?

[B]

How much sense does it make to talk about numbers of part of the budget? I think the NATO summit talks about capabilities that are needed, and I totally agree with that. We need capabilities to defend ourselves. That's what we got to do. We don't need a record high of military expenditures. I mean, look at it. 5% of GMP. You know how much that is? 225 billions of euros every year. I mean, in the moment, we have A situation where we have 90 billions per year and we're talking about 225. Do you really think that one could afford this and still do something for education, do something against poverty? I mean, that's almost an invitation for populist parties to give them the numbers they need to shaken our stability in democratic societies that are already under pressure, as we can see in the United States, as we can see in other European countries, as we can see worldwide. So we're not talking about doing not enough for our defense. I'm only discussing the point, whether it's really a good idea to give more and more and more money into arms. And besides, thinking that this is locomotive for economy I think is a great error.

[C]

I mean, given the political response to the manifesto, it seems like you're just not quite winning that argument. What?

[B]

How do you come to that conclusion? There was a poll where people were asked what they thought about this manifesto, a manifesto that was talked about in public media in a rather negative way. And the poll showed that half of the population agrees to what was advocated there. And not only that, but in some party electorate, as in ours for instance, a majority agree to that and most of the age groups agree to that. Only in the conservative green electorates you saw a different vote. So therefore I don't think you're right with the assumption that that doesn't find positive echo. Although we have debates as we have it in the democracies, that's by the way, the difference to other forms of government we have in the world.

[C]

Sounds like you see a disconnect between elite opinion and kind of where the general public is.

[B]

We haven't even started to discuss that very intensively. And one of the points why we do this is we had just general elections. The Social Democrats had a very bad result, 16% right wing populists more than we have. And if we don't discuss what the reason for that was and what we have to change, we will see much less stable government in the biggest country in the middle of Europe. And I don't think that's his reason. Therefore, if we want stability, we better look how we give better answers to the people.

[C]

All right, leave it there. Thank you so much for joining us.

[B]

Thank you.

[C]

Okay, that's it for this week. Make sure you subscribe to EU Confidential on your favorite podcast app, Rate us, leave a review or send us an email@podcastolitico EU with your ideas for guests and topics. And while you're at it, send us your summer reading recommendations. We're putting together a special literary episode coming up in July. And, yes, we're accepting voice memos, too. Thanks, as always, to Deanna Stirrus, our senior audio producer, and to Ann McAlfoy, POLITICO's head of audio. I'm Sarah Wheaton. See you next week.

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