CONGRESSOFTHEUNITEDSTATES

CONGRESSIONALBUDGET OFFICE

A

NATO

Burdensharing

After

Enlargement

P A P E R

CBO

AUGUST 2001

NATO BURDENSHARING

AFTER ENLARGEMENT

The Congress of the United States

Congressional Budget Office
NOTES

Numbers may not add up to totals because of rounding.

The cover photo was provided courtesy of the North Atlantic Treaty Organization.
PREFACE

For more than 50 years, the United States has pledged to help its European allies

defend themselves against outside aggression under the Washington Treaty of 1949.

The 1998 debate over enlarging the North Atlantic Treaty Organization (NATO) to

include three Central European democracies reignited the longstanding debate as to

whether the United States bears an unfair share of the burden of the common defense.

This Congressional Budget Office (CBO) paper examines several measures of

defense burdensharing to determine how much the United States contributes to the

collective defense relative to what other NATO allies contribute. It looks at traditional measures of defense budgets as well as military personnel and other metrics

that measure countries’ efforts to enhance collective security. 

The paper was requested by the Chairman and Ranking Member of the Senate

Foreign Relations Committee. In keeping with CBO’s mandate to provide objective

and nonpartisan analysis, it makes no recommendations.

The paper was prepared by John J. Lis and Zachary Selden of CBO’s National

Security Division, under the supervision of Christopher Jehn and R. William

Thomas. Delia Welsh and Sally Sagraves provided valuable assistance.

Christine Bogusz edited the paper, and John Skeen proofread it. Cindy

Cleveland prepared the paper for publication, and Lenny Skutnik produced the

printed copies. Annette Kalicki prepared the electronic versions for CBO’s Web site

(www.cbo.gov).

Dan L. Crippen

Director

August 2001

CONTENTS

SUMMARY vii

I PAST AND PRESENT TRENDS IN BURDENSHARING 1

Standard Measures of Burdensharing 1

Other Measures of Burdensharing 9

Assessing the Contributions of Individual Allies 16

II LIKELY TRENDS IN BURDENSHARING 19

III PAYING FOR NATO’S COMMON COSTS 23

Determining NATO’s Infrastructure Budget 25

Common Budgets After Enlargement 25

NSIP Funding of U.S. Installations in Europe 27

NATO’s Airborne Early Warning and Control Program 27

APPENDIXES

A SUPPLEMENTARY DATA ON DEFENSE SPENDING

AND ECONOMIC AID 29

B INFORMATION ABOUT DATA SOURCES 33
vi NATO BURDENSHARING AFTER ENLARGEMENT August 2001

TABLES

1. Allied Defense Spending Compared with U.S. Defense

Spending, 1985 and 1999 5

2. Military and Civilian Personnel as a Percentage of the

Labor Force in Selected Years, 1980-2000 8

3. Members’ Contributions to NATO’s Reaction Forces

and to Gross Domestic Product in 1998 11

4. NATO Forces in Bosnia in Total and per Million of

Population, 1996-1999 14

5. Allied Contributions to NATO’s Common Budgets in 1999 24

A-1. Defense Spending as a Percentage of Gross Domestic

Product in Selected Years, 1980-2000 30

A-2. Defense Spending per Capita in Selected Years, 1980-2000 31

A-3. NATO Members’ Economic Aid to Central and Eastern

Europe per Million Dollars of Their Gross Domestic

Product in Selected Years, 1991-1997 32

FIGURES

1. Defense Spending as a Percentage of Gross Domestic

Product, 1985 and 1999 4

2. Defense Spending per Capita, 1985 and 1999 7

3. Personnel in the Kosovo Force per Million of Population,

June 2000 16

4. NATO Members’ Total Economic Aid to Central

and Eastern Europe per Million Dollars of Their Gross

Domestic Product, 1991-1997 17

BOX

1. European Responses to American Criticisms

of European Burdensharing 10
SUMMARY

Since 1949, the United States has committed itself to defending its European allies

in the North Atlantic Treaty Organization (NATO), regarding any attack on those

countries as an attack on itself. But some Members of Congress have questioned

whether this country has borne an unfair share of the burden of the common defense.

Over the past 50 years, the United States has maintained as many as 300,000 military

personnel in Europe and has consistently devoted more of its gross domestic product

(GDP) to defense than have most of its allies. With the end of the Cold War and the

demise of the Soviet threat, the United States cut its force presence in Europe to

about 100,000 and sharply reduced its defense budget. But the European allies have

also cut their defense spending over the past decade, leaving the United States still

bearing the largest financial burden among the NATO allies.

The question of burdensharing gained renewed prominence in the late 1990s

as the Senate debated whether to admit three Central European democracies to

NATO. Senators on both sides of that debate were concerned that the United States

not bear an unfair share of the costs of enlargement. But the burdensharing issue is

not a new one. It dates back to the first days of the alliance, when the United States

agreed to provide economic and military aid to the countries of Western Europe to

help them rebuild after World War II and to station troops in Europe to defend those

nations. As Europe grew more prosperous, the Congress increased its calls for the

Europeans to provide a greater share of their own defense, calls that have continued

up to the present.

This report examines burdensharing among the allies within the context of

NATO’s post-Cold War mission, which includes elements—such as peacekeeping

and humanitarian operations—that were not core missions during the Cold War. It

considers standard measures of burdensharing, such as:

o Defense spending as a proportion of GDP,

o Defense spending per capita, and

o The proportion of the labor force in the military.

It also examines other measures of burdensharing that apply to the post-Cold War

environment, including:

o Contributions to NATO’s rapid reaction forces,
viii NATO BURDENSHARING AFTER ENLARGEMENT August 2001

o Contributions to peacekeeping forces in Bosnia and Kosovo, and

o Economic assistance to Central and Eastern Europe. 

In addition, this paper examines projections of future military spending and

personnel strength in the allied countries through 2003, as well as the European

Union’s defense plan. Finally, it looks at the three common budgets the alliance

operates to pay the costs of its civil headquarters, military command, and infrastructure projects.

STANDARD MEASURES OF BURDENSHARING

NATO and the Department of Defense commonly use several measures of

burdensharing to gauge the contributions of the European allies. Those measures

include defense spending as a share of GDP, defense spending per capita, and the

proportion of the workforce in the military. 

Defense Spending as a Percentage of GDP

Defense spending as a percentage of GDP, which measures the share of a country’s

national income devoted to defense, is a widely cited measure of defense

burdensharing. Throughout NATO’s 50-year history, the United States has spent a

larger share of its GDP on defense than have most of its allies. In 1985, at the height

of the Cold War arms buildup, the United States spent 6.7 percent of its GDP on

defense, compared with the European allies’ 3.5 percent of their collective GDP

spent on defense. By 1999, those figures declined to 3.0 percent and 2.3 percent,

respectively.

Two conclusions can be drawn from those figures. First, with the exception

of Greece and Turkey, Europeans on the whole spend considerably less on defense

than does the United States. Second, the spending gap has narrowed since 1985. All

of the NATO allies came closer to matching the U.S. defense commitment in 1999

than they did in 1985.

Per Capita Defense Spending

The United States also spends more per capita on defense than do any of its allies.

In 1999, the United States spent $947 per person on defense (measured in 1995

dollars), more than twice the average of the European allies. Among the major allies,

France spent $780 per person on defense that year, whereas Britain spent $534, Italy

spent $350, and Germany spent $490. That gap may reflect both the global nature
SUMMARY ix

1. The full text of NATO’s strategic concept is available at www.nato.int/docu/pr/1999/p99-065e.htm.

of American security interests and the United States’ leadership role in European

security.

Proportion of the Labor Force in the Military

Personnel remains one area in which several European allies make a larger

proportional contribution to the common defense than does the United States. In

1999, 1.6 percent of the U.S. workforce was employed in the defense sector,

compared with 1.7 percent for the European allies. Conscription—which many

European allies continue to use—may be one explanation: manpower is cheaper for

the Europeans in budgetary terms. However, some countries as a matter of policy do

not deploy draftees outside of their borders, limiting their contribution to the “out-ofarea” conflicts that have become the focus of NATO’s post-Cold War operations.

OTHER MEASURES OF BURDENSHARING

The standard measures of burdensharing capture the overall expenditure of resources

for the military, but they may not indicate how willing and able the allies are to

contribute to NATO missions. As the threat of a massive assault from the East

subsided, NATO’s focus has shifted to ensuring stability in Europe. As NATO’s

strategic concept notes, the new security environment brings many varied

challenges.1 Conventional warfare on the periphery of the region is a potential threat,

but so is the instability that transitions between regimes and economic adjustment

may continue to bring to Eastern Europe and Russia. Contributions to NATO’s rapid

response forces and peacekeeping missions, as well as economic assistance to the

newly democratic states of Europe, are additional gauges of burdensharing.

Contributions to NATO’s Reaction Forces

NATO’s strategic concept calls for the development of reaction forces that can be

deployed to potential crisis zones that threaten stability on the periphery of the

alliance. The United Kingdom has been in the forefront of those efforts, and France,

although it still does not participate in NATO’s common military command structure,

has also developed forces that augment the alliance’s capability. Germany plans to

develop a significant reaction force.
x NATO BURDENSHARING AFTER ENLARGEMENT August 2001

Contributions to Peacekeeping Missions

Many of the European allies bear more than their proportional share of the burden of

the peacekeeping operations in Bosnia and Kosovo. Denmark and Luxembourg, for

example, have contributed large shares to those operations relative to their

populations, providing 123 troops and 63 troops per million of population,

respectively, to the Bosnia peacekeeping mission in 1999. France and Britain also

have contributed disproportionately. Although the United States contributed a

relatively small 19 troops per million of population in 1999, it has consistently

supplied the largest contingent to the stabilization force in Bosnia.

The European allies also took on a large share of the burden of the Kosovo

Force peacekeeping mission (KFOR). The United States maintains the largest

national presence in Kosovo, but the majority of the troops on the ground are

European. As of June 2000, there were 5,600 U.S. troops in KFOR, compared with

4,550 French troops, 4,200 German troops, 4,750 Italian troops, and 3,200 British

troops. When adjusted for size of population, however, all of the NATO allies except

Canada and Turkey are contributing more personnel to KFOR than is the United

States.

Economic Aid to Former Warsaw Pact Countries

Another indicator of the contribution that NATO countries are making toward the

common goal of European security is the economic assistance they provide to Central

and Eastern Europe (including the former Soviet Union). Once again, many of the

European allies shoulder at least a proportional share of that cost. From 1991 to

1997, Germany provided more aid to that region than any other country—over $15

billion in grants and loans. Denmark also made substantial contributions for its size,

providing nearly $600 in aid per million dollars of GDP, compared with the United

States’ contribution of $245 per million dollars of GDP.

LIKELY TRENDS IN BURDENSHARING

The European allies are developing the reaction forces needed to carry out new

NATO missions while modernizing equipment that is generally less sophisticated

than U.S. equipment. That simultaneous push is likely to strain current defense

budgets. One solution is to increase defense budgets, but there appears to be little

sentiment in Europe for such a step. Instead, the major European militaries are

restructuring existing forces to perform new out-of-area missions without substantial

increases in defense spending.
SUMMARY xi

The gap in military capability between the United States and its European

allies concerns some analysts. A failure by many of NATO’s European members to

keep up with technological advances could render them incapable of operating

alongside U.S. forces in future military conflicts. Some analysts fear that the disparity could lead to a situation in which the United States would be the only country

in NATO capable of bringing sophisticated military power to confront a crisis.

Effects of European Integration on Burdensharing

The European allies plan to consolidate modernization efforts within the European

Security and Defense Plan (ESDP). ESDP would create, in the words of European

Union (EU) leaders, a “separable but not separate” organization from NATO that

would enable Europe to engage in peacekeeping and other activities without U.S.

participation. ESDP, however, is being developed within the framework of the

European Union rather than NATO, arousing some concerns that it will weaken the

Atlantic alliance.

Another factor potentially affecting European defense spending is the

European Monetary Union. Twelve members of the European Union have

established a joint currency, the euro. In doing so, they have transferred control of

their monetary policy to a European Central Bank and have accepted restrictions on

their fiscal policy—in particular, the ability to run budget deficits. That could

potentially restrict defense spending. Among those countries are nine NATO

members: Belgium, France, Germany, Greece, Italy, Luxembourg, the Netherlands,

Portugal, and Spain (the others are Austria, Finland, and Ireland).

It is too early to determine what effect European integration will have on

NATO. The increasing political integration of Europe could speed the development

of European forces capable of carrying out the EU’s defense policy, resulting in a

stronger European component of NATO and more equitable burdensharing.

Conversely, it could weaken the role of NATO as the European countries downplay

the importance of the Atlantic alliance and seek a more independent security policy

of their own.

Economic growth in the region may allow European defense budgets to rise

enough to pay for the replacement and modernization of necessary equipment. Yet

static or declining defense budgets are expected in most NATO countries. That may

further diminish their ability to make a meaningful military contribution to the

common defense, signaling a greater reliance on the larger allies to provide actual

military capability while they focus on the “soft” aspects of security, such as foreign

assistance and peacekeeping.
xii NATO BURDENSHARING AFTER ENLARGEMENT August 2001

NATO’S COMMON COSTS

Most allied defense resources are allocated by national governments to their own

militaries. Some costs, however, are borne by the alliance as a whole. NATO

maintains three common budgets: 

o A civil budget for the alliance’s political offices, international staff, and

economic and scientific programs; 

o A military budget to pay for NATO’s military headquarters in Mons,

Belgium, and its activities; and

o An infrastructure budget, known as the NATO Security Investment Program

(NSIP), to pay for projects to improve military readiness and capability. 

For 1999, the civil budget was $161 million; the military budget, $496

million; and the NSIP budget, $458 million. For each of those budgets, cost shares

are determined by consensus among the allies and are periodically renegotiated,

particularly when new members join the alliance. The United States has historically

paid about 25 percent of each budget.

In general, the NSIP pays for operational facilities that fulfill a commitment

to NATO; those facilities are above and beyond a country’s national requirements for

defense. Previous NSIP allocations have funded pipelines that would have delivered

fuel across Germany to supply forces facing a Warsaw Pact invasion and

improvements to air bases that NATO aircraft would use. Nearly all European bases

that house U.S. forces are eligible for NSIP projects. U.S. officials estimate that such

facilities received improvements from the NSIP valued at $4.1 billion from 1989 to

1999; over that 10-year period, the United States contributed $2.7 billion to the

program. 

Because little change is expected in the size of the civil or military budgets

as a result of NATO’s enlargement, the addition of three new paying members

(Poland, Hungary, and the Czech Republic) is likely to reduce slightly the burden of

those budgets for the existing allies. Enlargement will increase the cost of the NSIP,

however; NATO headquarters estimates that increase at $1.5 billion over 10 years,

approximately $400 million of which will be paid by the United States.

In addition to covering the cost of the alliance’s military headquarters, the

common NATO military budget funds the operation and modernization of the 18

aircraft and facilities that constitute NATO’s Airborne Early Warning and Control

program. Some U.S. and allied officials believe that this program provides a model

for coordinating other common programs that would provide the alliance with a
SUMMARY xiii

capability outside of those possessed by national militaries. The development of

additional common capabilities could be a way to improve the alliance’s effectiveness while reducing the cost to its members.

CHAPTER I

PAST AND PRESENT TRENDS IN BURDENSHARING

For half a century, the North Atlantic Treaty Organization (NATO) has bound

together the United States and Western Europe in an effective and longstanding

military alliance. NATO has both defended Western Europe against the menace of

Soviet expansionism and provided the framework within which World War II

adversaries could reconcile.

The U.S. Congress authorized the stationing of American troops at European

bases and appropriated the money needed to fulfill the United States’ commitment

to help defend Europe. But debates over the sharing of defense burdens characterized

NATO’s earliest years. Dean Acheson, the Secretary of State who oversaw the

creation of NATO, wrote of the problems he faced in persuading the Europeans to

undertake greater responsibility for their own defense. Acheson also faced

Congressional determination that the United States not be stuck with the bill for the

endeavor.

Burdensharing remained an issue of contention throughout the Cold War and

persisted even after the collapse of the Soviet Union. Although the demise of the

Soviet threat allowed Western democracies to reduce the resources they devoted to

defense, instability on the periphery of the alliance and the uncertain nature of

developments in Russia have persuaded the NATO allies that the alliance retains a

useful role in European security.

NATO’s 1991 strategic concept refocused the alliance on threats outside its

borders, a mission that was reaffirmed at its Washington Summit in April 1999.

Crises like those in Bosnia and Kosovo underlined the changed nature of European

security and burdensharing. No longer was the primary concern the number of

divisions a country offered to block a Soviet invasion of West Germany; rather, it

was the division of labor and risk associated with missions outside NATO territory.

STANDARD MEASURES OF BURDENSHARING

A gap persists between U.S. defense spending and European defense spending by

many measures. This paper explores that gap by examining several indicators of

contributions to the common defense. To provide historical context, it first looks at

trends in standard indicators of burdensharing, including:
2 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

o Defense spending as a percentage of gross domestic product (GDP),

o Defense spending per capita, and

o The percentage of the labor force in the military.

It also considers other measures of burdensharing that may be significant given

NATO’s post-Cold War operations, including:

o Contributions to rapid reaction forces designed for out-of-area missions,

o Contributions to peacekeeping missions in Bosnia and Kosovo, and

o Economic assistance to the former Eastern Bloc countries.

Because each measure of burdensharing has its limitations, this paper presents

a range of measures to provide a more complete picture. For example, the percentage

of a nation’s GDP devoted to defense fails to account for differences in the

purchasing power of those resources and how efficiently they are spent. Likewise,

defense spending on a per capita basis does not account for differences in income

levels among countries. And counting the number of men and women in a country’s

armed forces fails to consider the investment made in weaponry or the effect of

conscription on the true capability of a country’s military.

Despite their limitations, those measures of burdensharing are among the

most important for two reasons. First, military strength is the ultimate currency in

which an alliance’s capability is measured; second, those measures are used in

studies by NATO and the U.S. Department of Defense (DoD). The Defense

Department’s annual Report on Allied Contributions to the Common Defense details

the relative and absolute contributions of the United States’ allies to the common

defense. That study measures many of the same factors presented here, but this paper

also examines common NATO budget issues and European defense plans, and it

provides a historical look at burdensharing.

Defense Spending as a Percentage of Gross Domestic Product

Defense spending as a percentage of gross domestic product measures the portion of

a country’s overall economy that it devotes to defense. It indicates the burden that

defense places on the economy of each country, automatically adjusting for

differences in national income. The percentage of GDP spent on defense also measures a country’s overall level of effort, regardless of how it allocates its defense

budget—some countries may spend more on personnel and have larger troop
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 3

strength, whereas others may focus on training, equipment modernization, or

research.

The United States has consistently spent a greater share of its national income

on defense than have its allies, except for Greece and Turkey. In general, spending

as a percentage of GDP by the United States and its allies rose through NATO’s first

decade but fell in the 1960s and 1970s. In the Europeans’ case, some of that

spending pattern is attributable to their rapid economic growth in those years, which

reduced the burden defense spending placed on their economies.

In the early 1980s, alliancewide defense spending climbed again, though the

increases of the Reagan Administration were not matched to the same degree by the

allies. As a result, by 1985 the United States spent 6.7 percent of its GDP on

defense, compared with 5.3 percent spent by the United Kingdom, 4.1 percent by

France, 3.2 percent by Germany, and 2.7 percent by Italy. Only Greece, a relatively

poor country, spent a greater share of its GDP on defense in 1985 than did the United

States, 7.1 percent (see Figure 1; for additional information, see Table A-1 in

Appendix A).

After the end of the Cold War, the NATO countries dramatically cut their

defense spending. British defense spending fell to 3.0 percent in 1995; French to 3.1

percent; German to 1.7 percent; Italian to 1.8 percent; and U.S. to 3.8 percent. Since

1995, defense spending in the alliance has remained relatively flat. Among the major

allies, France, Britain, and Germany have seen small decreases that mirror that of the

United States; only Italy has had a small increase.

Those dramatic reductions in defense budgets have not changed one central

fact: the United States spends more of its income on defense than do its major allies.

In 1999, the U.S. defense budget was 3.0 percent of GDP, compared with 2.7 percent

in France, 2.5 percent in Britain, 2.0 percent in Italy, and 1.5 percent in Germany.

The only NATO countries that spent a greater share of their GDP on defense were

Turkey (5.4 percent) and Greece (4.8 percent). As for the other smaller allies, all but

the Czech Republic, Norway, Poland, and Portugal spent less than 2.0 percent of their

GDP on defense in 1999.

When measured against the percentage of GDP that the United States spent

on defense in 1999, European contributions ranged from 27 percent of the U.S.

commitment (Luxembourg) to 90 percent of the U.S. commitment (France). However, that gap has narrowed since the height of the U.S. arms buildup in 1985 (see

Table 1). All of the NATO allies came closer to matching the U.S. defense commitment in 1999 than they did in 1985. The United States cut its percentage of GDP

devoted to defense by more than half; the European allies cut somewhat less. One

could argue that the Europeans have been more cautious in their reductions than the

United States, but they began from a measurably lower base.
4 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

Belgium

Canada

Czech Republic

Denmark

France

Germany

Greece

Hungary

Italy

Luxembourg

Netherlands

Norway

Poland

Portugal

Spain

Turkey

United Kingdom

United States

 

012345678

Percentage of GDP

1985

1999

The percentage of GDP spent on defense, however, does not reflect how

efficiently a country allocates its resources. For example, a country that subsidizes

its domestic defense industry by purchasing equipment that is inferior or in excess

of what it may need will contribute less to alliance security than that percentage

indicates. That number also does not reflect whether countries are structuring their

forces to carry out the new missions envisioned in NATO’s strategic concept; for

instance, a country spending more on heavy forces designed for territorial defense

may contribute less to NATO’s capability than one that is developing lighter, more

mobile forces that can respond to threats outside the territory of alliance members.

FIGURE 1. DEFENSE SPENDING AS A PERCENTAGE OF GROSS DOMESTIC

PRODUCT, 1985 AND 1999

SOURCE: Congressional Budget Office based on data from the North Atlantic Treaty Organization (NATO).

NOTES: For additional information, see Table A-1 in Appendix A.

Iceland is excluded because it has no armed forces.

No data are available for Poland, Hungary, and the Czech Republic in 1985 because those countries did not join

NATO until 1999.
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 5

TABLE 1. ALLIED DEFENSE SPENDING COMPARED WITH U.S. DEFENSE

SPENDING, 1985 AND 1999 (As a percentage of GDP)

1985 1999

Defense

Spending

Percentage of

U.S. Defense

Spending

Defense

Spending 

Percentage of

U.S. Defense

Spending

Difference (in

percentage

points)

Belgium 3.0 45 1.4 47 2

Canada 2.2 33 1.3 43 10

Czech Republica n.a. n.a. 2.2 73 n.a.

Denmark 2.2 33 1.6 53 20

France 4.1 61 2.7 90 29

Germany 3.2 48 1.5 50 2

Greece 7.1 106 4.8 160 54

Hungarya n.a. n.a. 1.6 53 n.a.

Italy 2.7 40 2.0 67 27

Luxembourg 1.1 16 0.8 27 11

Netherlands 3.1 46 1.8 60 14

Norway 3.3 49 2.2 73 24

Polanda n.a. n.a. 2.0 67 n.a.

Portugal 3.1 46 2.2 73 27

Spain 2.7 40 1.3 43 3

Turkey 4.5 67 5.4 180 113

United Kingdom 5.3 79 2.5 83 4

United States 6.7 100 3.0 100 0

NATO Average 3.6 54 2.6 77 23

NATO European 

Averageb 3.5 52 2.3 77 25

SOURCE: Congressional Budget Office based on data from the North Atlantic Treaty Organization (NATO).

NOTES: n.a. = not applicable.

Calculations are based on weighted averages.

Iceland is excluded because it has no armed forces. 

a. No data are available for Poland, Hungary, and the Czech Republic in 1985 because those countries did not join NATO

until 1999.

b. Excludes the United States and Canada.
6 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

1. NATO uses average exchange rates for each year to calculate dollar values for other countries’ defense

spending. NATO is considering using “purchasing power parity” (PPP) to calculate defense

expenditures. The PPP method applies international dollar price weights based on actual purchase

prices to the quantities of goods and services produced in a given economy. 

Per Capita Defense Spending

Per capita defense spending measures how much a country devotes to defense

relative to the size of its population. Residents of wealthier countries generally

contribute more to the alliance’s total defense spending even though they may devote

a smaller portion of their income to that purpose.

Americans contribute more to defense than residents of any other NATO

country. The United States spent $947 per person on defense in 1999 (measured in

1995 dollars), more than twice the average of the European allies. The only ally

whose spending approached the U.S. level was Norway, which spent $831 per

person.1 As for the major allies, France spent $780 per person on defense, while the

United Kingdom spent $534, Italy spent $350, and Germany spent $490. Turkey,

which spends a greater percentage of its national income on defense than any other

ally, spent only $123 per person in 1999, reflecting its status as one of the poorer

NATO countries.

That difference in per capita spending between the United States and Europe

is part of a longstanding pattern. In 1985, the United States spent $1,467 per capita

on defense (in 1995 dollars), 64 percent more than Germany, the second-leading

contributor. Among the European allies, France, the United Kingdom, and Norway

have generally spent the most per capita on defense. Italian per capita spending has

remained relatively flat since 1985, whereas German spending has decreased

dramatically since reunification in 1990 (see Figure 2; for additional information, see

Table A-2 in Appendix A).

Military and Civilian Personnel as a Percentage of the Labor Force

Dividing the number of military and civilian personnel by the size of a country’s

labor force measures each country’s relative labor contribution to the common

defense. All of the NATO allies except Greece have cut the size of their armed

forces since 1985. Nonetheless, this remains one area in which several European

allies contribute proportionately more to the common defense than does the United

States (see Table 2).

In 1999, military and civilian personnel constituted 1.6 percent of the

American workforce, the average for NATO as a whole. The European allies, taken

as a whole, had 1.7 percent of their workforce in defense. France, Greece, Italy,
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 7

Belgium

Canada

Czech Republic

Denmark

France

Germany

Greece

Hungary

Italy

Luxembourg

Netherlands

Norway

Poland

Portugal

Spain

Turkey

United Kingdom

United States

 

0 500 1,000 1,500

1995 U.S. Dollars per Capita

1985

1999

Norway, Portugal, and Turkey all had proportionately more of their labor force in

defense than did the United States.

Historically, Europe has consistently had a slightly greater share of its labor

force in defense than has the United States, perhaps because of its greater reliance on

conscription. Some European countries, particularly Greece and Turkey, rely heavily

on conscription. Other countries—such as Spain, Portugal, Italy, and France—are

following the lead of the United Kingdom, Belgium, and the Netherlands in

switching to an all-volunteer force. Although conscription is declining, several

NATO countries plan to retain some form of compulsory military service, which

inflates Europe’s percentage of its labor force in the military relative to that of the

United States.

FIGURE 2. DEFENSE SPENDING PER CAPITA, 1985 AND 1999

SOURCE: Congressional Budget Office based on data from the North Atlantic Treaty Organization (NATO) and the

International Monetary Fund.

NOTES: For additional information, see Table A-2 in Appendix A.

Iceland is excluded because it has no armed forces.

No data are available for Poland, Hungary, and the Czech Republic in 1985 because those countries did not join

NATO until 1999.
8 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

TABLE 2. MILITARY AND CIVILIAN PERSONNEL AS A PERCENTAGE OF THE

LABOR FORCE IN SELECTED YEARS, 1980-2000

1980 1985 1990 1995 1996 1997 1998 1999 2000a

Belgium 2.9 2.8 2.8 1.3 1.2 1.1 1.1 1.1 1.1

Canada 1.0 0.9 0.9 0.7 0.6 0.5 0.5 0.5 0.5

Czech Republicb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 1.4 1.3

Denmark 1.6 1.4 1.4 1.3 1.3 1.2 1.2 1.3 1.2

France 3.0 2.9 2.7 2.4 2.3 2.2 2.1 2.0 1.9

Germany 2.4 2.3 2.6 1.3 1.2 1.2 1.2 1.1 1.1

Greece 6.1 6.1 5.7 5.6 5.6 5.5 5.2 5.1 5.1

Hungaryb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 1.6 1.7

Italy 2.4 2.5 2.4 2.2 2.1 2.1 1.9 1.9 1.8

Luxembourg 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.9 0.8

Netherlands 2.5 2.4 2.1 1.4 1.3 1.1 1.1 1.0 1.0

Norway 2.6 2.3 2.9 2.3 2.2 1.9 1.8 1.8 1.8

Polandb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 1.4 1.4

Portugal 2.5 2.8 2.3 1.9 1.8 1.8 1.7 1.7 1.7

Spainc n.a. 2.5 2.0 1.6 1.6 1.5 1.4 1.2 1.2

Turkey 4.3 4.6 3.9 3.8 3.8 4.0 3.8 3.6 3.5

United Kingdom 2.2 1.9 1.7 1.3 1.2 1.2 1.2 1.1 1.1

United States 2.8 2.9 2.6 1.9 1.8 1.7 1.6 1.6 1.5

NATO Average 2.7 2.7 2.5 1.9 1.8 1.8 1.7 1.6 1.6

NATO European 

Averaged 2.8 2.8 2.6 2.0 2.0 1.9 1.9 1.7 1.7

SOURCE: Congressional Budget Office based on data from the North Atlantic Treaty Organization (NATO).

NOTES: n.a.= not applicable.

Iceland is excluded because it has no armed forces.

Calculations are based on weighted averages.

a. Estimated by NATO based on available data.

b. Poland, Hungary, and the Czech Republic did not join NATO until 1999.

c. Spain did not join NATO until 1982.

d. Excludes the United States and Canada.
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 9

It is difficult to compare conscript militaries with all-volunteer forces in terms

of either cost or quality. Conscription usually reduces the budgetary costs of maintaining a military force by shifting some costs from taxpayers to conscripts, who

serve for lower wages than volunteers. Although such forces are less costly, they are

generally less capable. Also, because of their shorter term of service, conscripts are

unlikely to develop the same skills as professional soldiers.

Some NATO allies with conscripted forces prohibit the deployment of

draftees outside the national territory. Given Europe’s acknowledged need to

develop more rapidly deployable units for out-of-area operations, maintaining

conscription may not only create a less skilled military but also divert resources

necessary to modernize the force structure to fit NATO’s new missions.

OTHER MEASURES OF BURDENSHARING

The measures discussed above ignore other contributions to European security that

some Europeans argue are more significant in the post-Cold War world. Countries

facing criticism for their failure to spend enough on defense or maintain a strong

enough military can point to other areas in which they contribute to the security of

the North Atlantic region (see Box 1). For example, some of the European allies

offset some costs to support U.S. forces based in their territory. Also, some countries

with small militaries devote a large share of their defense resources to the

peacekeeping missions that are becoming increasingly frequent. Others have offered

financial aid and technical assistance to countries in transition from communism to

market democracy, perhaps recognizing that stable, satisfied neighbors can contribute

to national security.

This section examines three alternative measures of burdensharing: contributions to NATO’s rapid and immediate reaction forces, participation in the Bosnia and

Kosovo peacekeeping missions, and assistance to formerly communist countries.

The Congressional Budget Office (CBO) also considered involvement in the

Partnership for Peace program as a potential indicator, but a lack of consistent data

degraded the usefulness of that measure.

Contributions to Reaction Forces

NATO’s 1991 strategic concept, its first review of the post-Cold War environment,

emphasized the development of lighter, more mobile forces that could respond

quickly to crises outside the territory of NATO member states. As part of that

concept, NATO divided the forces of its member countries into three classes.

“Reaction forces” are those that can be rapidly transported to remote crisis areas;

“main defense forces” provide the bulk of the capability to defend the territory of the
10 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

alliance; and “augmentation forces” provide reinforcement capability. Reaction

forces comprise both immediate reaction forces—the first units to deploy—and rapid

reaction forces, which would deploy a few days later.

Reaction forces are maintained in a high state of readiness because they

provide the units on which the alliance would draw for the out-of-area missions it is

more likely to undertake in the current environment. They include national units,

units that are pledged to multinational NATO units like the Allied Rapid Reaction

Corps (ARRC), and units that are part of other multinational formations, like the

Eurocorps, which is made up of forces from France, Germany, Spain, Luxembourg,

and Belgium.

Because reaction forces would be used for the most likely alliance missions,

those units might be said to contribute more to the common defense than units

intended for defense of the national territory. Thus, examining each ally’s contribution to reaction forces may provide a more accurate measure of burdensharing than

total military personnel levels. When viewed in light of the size of a country’s

BOX 1.

EUROPEAN RESPONSES TO AMERICAN CRITICISMS

OF EUROPEAN BURDENSHARING

Although the gap has narrowed, a persistent difference exists between European and U.S. defense

spending by many standards. European political leaders could argue that this gap is largely

illusory on the basis of the following points:

o Europe does not have the same global commitments as the United States. European

nations should not be expected to devote the same percentage of their gross domestic

product (GDP) to defense because European interests and military budgets are geared

to regional contingencies. The United States has a much broader set of global security

interests, so its overall defense expenditures should naturally be larger. 

o Europe provides direct and indirect support to U.S. forces. Many U.S. operations in the

Persian Gulf and other regions are conducted from bases in Europe. Those bases are

provided and their costs subsidized by the host country. In addition, NATO’s common

budget pays for many improvements to those bases. 

o By measures more appropriate to the post-Cold War environment, the European allies

are contributing a fair share to the common defense. Europe contributes proportionate

numbers of troops to the Bosnia peacekeeping mission and NATO’s rapid reaction

forces.

o The European allies devote more of their GDP to providing economic assistance to the

former Eastern Bloc countries. Economic and political stabilization of the region is

important to prevent the social tensions that could lead to civil unrest or open conflict.
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 11

economy, that measure provides another basis of comparison among members of the

alliance.

The U.S. Department of Defense has compiled broad figures on each ally’s

contribution to NATO’s reaction forces in 1998. Those data represent the percentage

of the alliance’s reaction forces on land (measured in maneuver brigade equivalents),

sea (principal surface combatants), and air (combat aircraft) that each ally

contributed.

Belgium, Denmark, Greece, Portugal, Turkey, and the United Kingdom

contributed a larger share to NATO’s reaction forces across all three services than

their share of the NATO countries’ total GDP (see Table 3). France, Italy,

Luxembourg, and Spain contributed more to ground forces than to NATO-wide GDP

TABLE 3. MEMBERS’ CONTRIBUTIONS TO NATO’S REACTION FORCES AND TO

GROSS DOMESTIC PRODUCT IN 1998 (In percent)

Share of NATO’s Reaction Forces Share of

NATO’s GDPa Land Forces Naval Forces Air Forces

Belgium 3.0 1.7 3.7 1.5

Canada 0.7 3.4 1.5 3.5

Denmark 2.3 3.4 1.2 1.0

Franceb 18.6 10.3 0 8.5

Germany 7.4 5.2 10.2 12.7

Greece 7.4 7.8 0.8 0.7

Italy 13.6 8.6 2.9 7.0

Luxembourg 0.2 0 0 0.1

Netherlands 2.2 6.9 5.6 2.2

Norway 0.7 4.3 0.8 0.9

Portugal 2.3 0.9 1.7 0.6

Spain 7.6 3.4 3.1 3.3

Turkey 6.7 7.8 6.2 1.2

United Kingdom 20.0 14.7 13.2 8.1

United States 7.4 21.6 49.0 48.6

NATO Total 100.0 100.0 100.0 100.0

SOURCE: Congressional Budget Office based on information from the U.S. Department of Defense.

NOTES: NATO = North Atlantic Treaty Organization.

Iceland is excluded because it has no armed forces.

Poland, Hungary, and the Czech Republic are excluded because they did not join NATO until 1999.

a. NATO’s GDP is the total gross domestic product of all of the member countries.

b. France maintains its reaction forces separately from NATO’s integrated command structure.
12 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

in 1998; France, Italy, the Netherlands, Norway, and Spain met or exceeded that

benchmark in naval forces; and the Netherlands and the United States met or

exceeded it in contributions of combat aircraft. Only Canada’s and Germany’s

alliance militaries fell short in all three services.

Germany, however, plans to develop a Crisis Reaction Force of as many as

150,000 troops. Currently, one airborne unit in southern Germany is fully capable

of deploying outside of NATO territory, and some other units are maintained at high

readiness. German plans call for 80,000 troops to be available on very short notice

and the remainder to be maintained at lower readiness levels. German defense

planners are working to improve the mobility of their forces, focusing on transport

aircraft and helicopters. Plans call for six combat aircraft squadrons, six maneuver

brigades, and a naval contingent; currently, only three brigades are pledged to the

ARRC.

In its 1998 Strategic Defense Review, the United Kingdom committed to

developing joint rapid reaction forces, which will comprise high-readiness forces

across all services, including four army brigades. The United Kingdom provides

most of the logistical and administrative support to the ARRC as well as the largest

share of its combat forces. In addition, British forces make up a sizable part of the

maritime and air components of NATO’s reaction forces.

France does not contribute to NATO’s reaction forces because it chooses not

to participate in the integrated military command. It maintains its own reaction

forces, however, which include four army divisions and a carrier battle group. The

land and naval units have operated with NATO’s forces in the former Yugoslavia and

the Adriatic Sea, so some French forces are included in NATO’s totals. The French

defense plan calls for reaction forces that include 50,000 troops, about 100 combat

aircraft, one carrier battle group, and several nuclear attack submarines.

Participation in Peacekeeping Missions

NATO has conducted peacekeeping missions in the Balkans since 1995. As a

measure of burdensharing, the number of ground troops deployed to Bosnia and

Kosovo may indicate a country’s willingness to commit its forces to enhance

European security. When adjusted for a country’s population, that measurement

provides a basis for comparing each member’s relative willingness to share the

burden of carrying out alliance missions.

Bosnia. The first operational peacekeeping mission that NATO undertook outside

the territory of its member states was in Bosnia-Herzegovina in December 1995. The

implementation force (IFOR) was composed of roughly 54,000 ground troops in

Bosnia from all NATO militaries and several non-NATO militaries. It was charged
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 13

with enforcing the military aspects of the Dayton Peace Agreement, including

maintaining the cease-fire among the Bosnian Muslim, Croat, and Serb forces;

ensuring the withdrawal and separation of those forces; and collecting heavy

weapons from all sides. After the 12-month IFOR mission ended, it was replaced by

a smaller stabilization force (SFOR), which remains in Bosnia today.

The United States has supplied the largest single national contingent to IFOR

and SFOR, contributing about 16,500 ground troops to IFOR in 1996, 8,500 troops

to SFOR in its first year in 1997, and 6,900 troops and 5,100 troops to SFOR in 1998

and 1999, respectively. The other NATO allies contributed a total of 38,850 troops

to IFOR in 1996, nearly 19,000 in 1997, more than 20,000 in 1998, and 16,575 in

1999 (see Table 4). Of the European contingent, the United Kingdom supplied the

largest number of troops, followed by France, Germany, and Italy.

Several of the smaller NATO allies, however, made a significant contribution

from 1996 through 1999 for their relative size. When population is considered,

Luxembourg, Norway, and Denmark have shouldered the greatest burden in Bosnia.

France and Britain also made up a disproportionate share of IFOR, though both have

reduced their commitments in SFOR. The Netherlands, Greece, and Portugal also

contributed significantly to IFOR but have since scaled back their peacekeeping

forces.

When adjusted for population differences, all NATO allies bore a greater

personnel burden in the Bosnian peacekeeping mission than did the United States in

1999. For every 1 million citizens, there were 19 Americans stationed in Bosnia that

year, compared with 123 Danes, 60 Britons, and 49 French. Yet the United States

contributes more troops to Bosnia than any other country and provides overall

command of the operation. The U.S. Congress appropriated $8.6 billion to cover the

costs of U.S. participation in Bosnia from 1996 to 1999 (costs for other countries’

SFOR contingents are not readily available).

Kosovo. NATO has conducted two operations in Kosovo. In March 1999, NATO

began an air campaign against Serbia (Operation Allied Force) in response to that

country’s treatment of ethnic Albanians in the Serbian province of Kosovo. When

Serb forces pulled out of the province in June 1999, NATO and several additional

countries provided the Kosovo peacekeeping force (KFOR).

The European allies contributed both troops and equipment to Operation

Allied Force. However, a lack of stealth capabilities, precision-guided munitions,

and sophisticated communications equipment prevented the European allies from

taking on a large percentage of the air strikes. More than 700 of the 1,100 aircraft

flown during Operation Allied Force were American, and U.S. pilots delivered

approximately 80 percent of all munitions. Allied air forces were relegated to a

supporting role, collectively flying less than half of all sorties.
14 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

The European allies took on a greater share of the burden in KFOR’s

peacekeeping mission. Although the United States maintains the largest presence in

Kosovo, the majority of troops on the ground are European. As of June 2000, there

were 5,600 U.S. troops in KFOR, compared with 4,550 French, 4,200 German, 4,750

TABLE 4. NATO FORCES IN BOSNIA IN TOTAL AND PER MILLION OF

POPULATION, 1996-1999

1996 1997 1998 1999

Total

Per Million

Population Total

Per Million

Population Total

Per Million

Population Total

Per Million

Population

Belgium 300 29 120 12 750 74 500 49

Canada 1,000 34 1,200 40 1,250 41 1,050 34

Denmark 800 151 700 132 747 141 650 123

France 10,000 171 2,500 43 2,500 42 2,900 49

Germany 4,000 49 2,000 24 2,470 30 1,700 21

Greece 1,000 95 250 24 250 24 250 24

Italy 2,100 37 1,800 31 2,000 35 1,900 33

Luxembourg 300 750 30 75 18 45 25 63

Netherlands 2,000 129 1,200 77 1,084 69 950 60

Norway 1,000 227 750 170 615 140 150 34

Portugal 900 91 330 33 323 32 300 30

Spain 1,250 32 1,300 33 1,556 39 1,100 28

Turkey 1,200 20 1,500 24 1,500 24 1,600 25

United 

Kingdom 13,000 221 5,319 90 5,000 85 3,500 60

United States 16,500 62 8,500 32 6,900 25 5,100 19

NATO

Average 3,690 140 1,833 56 1,798 56 1,445 43

NATO 

European

Averagea 2,912 154 1,369 59 1,447 60 1,194 46

SOURCE: Congressional Budget Office based on information from the International Monetary Fund, the Congressional

Research Service, and the U.S. Department of Defense.

NOTES: NATO = North Atlantic Treaty Organization.

Iceland is excluded because it does not contribute military forces to the Bosnia peacekeeping mission.

No data are included for Poland, Hungary, and the Czech Republic because those countries did not join NATO until

1999.

a. Excludes the United States and Canada.
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 15

2. For a detailed study of the effectiveness of economic assistance, see Congressional Budget Office, The

Role of Foreign Aid in Development (May 1997).

Italian, and 3,200 British troops. When adjusted for size of population, however, all

of the NATO allies except Canada, the Czech Republic, and Turkey are contributing

more personnel to KFOR than does the United States (see Figure 3).

Economic Assistance to Central and Eastern Europe

Economic assistance can have many purposes, from promoting development to

encouraging changes in the recipients’ foreign policy. The effectiveness of such aid

is debatable, but economic assistance to Central and Eastern Europe may have helped

smooth the transition from communism to market democracy.2 Foreign aid to

Russia, Ukraine, and Belarus may have helped reduce the risk that nuclear weapons

could fall into the hands of rogue states or terrorist groups that would target the

United States and its allies. Economic assistance is an additional indicator of a

willingness to pursue common goals.

From 1991 to 1997, Germany provided more aid to the countries of Central

and Eastern Europe and the newly independent states of the former Soviet Union—

over $15 billion in grants and loans—on both an absolute and relative level than any

other NATO country. The United States was the second-largest contributor in

absolute terms, with $11.7 billion in aid to the region, followed by France ($2.1

billion), Canada (just over $1 billion), Italy ($840 million), and the United Kingdom

($814 million). In addition, Turkey has provided $600 million in loans to Russia and

a $20 million export credit to Albania.

When economic assistance is measured relative to GDP, however, the leading

contributors to the countries in transition were Germany, Denmark, Norway, and

Canada (see Figure 4; for additional information, see Table A-3 in Appendix A). Out

of every million dollars produced by the German economy from 1991 to 1997,

$1,130 was contributed to Central and Eastern Europe and the former Soviet Union.

Germany was followed by Denmark ($598), Norway ($432), and Canada ($252).

Among the other major allies over that period, the United States contributed $245 per

million dollars of GDP; France, $219; Italy, $110; and the United Kingdom, $107.

But economic assistance should be viewed in context. The amount of foreign

direct investment in Central and Eastern Europe totaled more than $18 billion in

1997 alone, dwarfing the flow of economic aid. In addition, NATO is primarily a

military alliance, so one could argue that contributions to the combat capabilities of

the alliance should be weighed more heavily than financial aid contributions when

considering burdensharing.
16 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

Belgium

Canada

Czech Republic

Denmark

France

Germany

Greece

Hungary

Iceland

Italy

Luxembourg

Netherlands

Norway

Poland

Portugal

Spain

Turkey

United Kingdom

United States

 

0 50 100 150 200 250

Number of Personnel

ASSESSING THE CONTRIBUTIONS OF INDIVIDUAL ALLIES

The relative contributions of the individual European allies vary widely. Among the

major allies, the United Kingdom and France maintain significant military forces and

fund them at a level approaching that of the United States in terms of the percentage

of GDP. Most of the other allies, however, have cut their defense spending to

historic lows. Despite that trend, many are still contributing proportionately to

NATO’s rapid reaction forces and restructuring their militaries to be more capable

of undertaking out-of-area operations.

By the measures reported in this paper, the United Kingdom is making a

strong contribution to the common defense of the alliance. Britain spent 2.5 percent

of its GDP on defense in 1999, an amount midway between the 2.3 percent spent by

the other European allies on average and the 3.0 percent spent by the United States.

Britain has also played a leading role in commanding NATO’s rapid reaction forces

and is working to reconfigure its military to become more mobile and more capable

of performing out-of-area missions. Its contribution to the alliance’s reaction forces

is more substantial than its share of GDP devoted to defense would indicate.

FIGURE 3. PERSONNEL IN THE KOSOVO FORCE PER MILLION OF POPULATION,

JUNE 2000

SOURCE: Congressional Budget Office based on data from the Congressional Research Service and the International

Institute for Strategic Studies.
CHAPTER I PAST AND PRESENT TRENDS IN BURDENSHARING 17

Belgium

Canada

Denmark

France

Germany

Greece

Italy

Luxembourg

Netherlands

Norway

Portugal

Spain

Turkey

United Kingdom

United States

 

0 200 400 600 800 1,000 1,200

U.S. Dollars

France is also making a strong effort toward the common defense, but that

contribution is hindered by France’s continued refusal to participate in NATO’s

integrated military command. Although France spends 2.7 percent of its GDP on

defense and has four mobile divisions, its failure to integrate with the other alliance

militaries reduces the contribution that its forces can make alongside those of other

allies.

By most measures, Germany’s contribution to NATO is not on the same level

as the other major allies’. Even though Germany has contributed large amounts of

economic assistance to the formerly communist countries, it spends only 1.5 percent

of its GDP on defense, about half the share of the United States. Germany has also

been slow to develop the reaction forces needed for military operations outside its

territory.

FIGURE 4. NATO MEMBERS’ TOTAL ECONOMIC AID TO CENTRAL AND 

EASTERN EUROPE PER MILLION DOLLARS OF THEIR GROSS 

DOMESTIC PRODUCT, 1991-1997

SOURCE: Congressional Budget Office based on data from the Organization for Economic Cooperation and Development.

NOTES: For additional information, see Table A-3 in Appendix A.

No data are available for Poland, Hungary, and the Czech Republic because those countries did not join NATO until

1999. Data for Iceland also are unavailable.
18 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

Germany recently completed a defense review that could provide the basis for

a reorganization of German defense. The review proposed reducing the number of

conscripts in the military from 130,000 to 30,000 and building a professional rapid

reaction force. The German government has chosen a somewhat smaller reduction

in the active-duty force, cutting the total number of conscripts to 80,000 and

postponing other reforms. If the review’s proposals are enacted, Germany may be

able to correct the deficiencies that keep it from contributing proportionally to the

alliance.

The midsized allies present a mixed picture. Italy has halted its decline in

defense spending and is making a notable contribution to the alliance’s reaction

forces. It also contributes a central position for operations in the Balkans (the air

operations over Kosovo were conducted mainly from Italian air bases), but Italy’s

contribution to NATO’s air forces is relatively minor. Spain has cut its defense

budget but still makes a proportional contribution to NATO’s reaction forces.

Without an increase in defense spending, however, the future capabilities of Spain’s

forces may be constrained.

Most of the smaller or less wealthy allies have allowed defense spending as

a share of GDP to fall to historic lows over the past decade. Only Greece and Turkey

spend more than the United States by that measure. As two of the poorest members

of the alliance, however, their absolute contribution is modest, and much of the

spending of each seems to be with an eye toward containing the other in the Aegean

region. Belgium, Canada, Denmark, Luxembourg, and the Netherlands have seen

their defense spending fall below 2.0 percent of GDP. Norway spends slightly more

than the regional average on defense. Portugal’s defense budget is in line with the

regional average, and it makes a proportionate contribution to reaction forces, as do

Belgium, Denmark, and the Netherlands. Iceland has no military, so it is not

considered in this context. Among the new allies, Poland and the Czech Republic

have increased their defense spending to 2.0 percent and 2.2 percent of GDP,

respectively. Hungary currently spends less but is projected to spend 1.8 percent of

its GDP on defense in 2001.

The United States continues to spend more on defense than any other country

in absolute terms, and its forces are central to the alliance. As a share of its income,

the United States spends more than any other major ally, although that gap has

narrowed since 1985. At 7.4 percent, the American contribution to NATO’s reaction

ground forces might appear relatively small, but virtually all U.S. armed forces are

designed to perform missions outside of U.S. territory. With more than 1.3 million

active-duty military personnel, the U.S. contribution to a NATO military mission

could be tremendous, if needed.
CHAPTER II

LIKELY TRENDS IN BURDENSHARING

Several European countries plan to undertake major modernization programs over

the next several years. In terms of air forces, Britain, Germany, Italy, and Spain have

undertaken a $30 billion program to procure 620 Eurofighter aircraft beginning in

2002, with options for 90 more. France plans to begin taking delivery of the Rafale

fighter in 2002, as well as upgrading the Mirage fighter. As for land forces, Germany

plans to upgrade its tank inventory, and France has near-term plans to procure new

tanks and develop an armored personnel carrier. In the longer term, the United

Kingdom plans to procure two new aircraft carriers around 2012, each carrying 50

new fighter aircraft.

At the same time they plan to modernize existing forces, several of the

European allies plan to develop a rapid reaction capability requiring significant

investment in airlift and sealift. That capability would enable those countries to

deploy forces rapidly to a crisis area and keep those forces supplied while conducting

out-of-area operations. Much of the airlift capability is to be met through

development of the Airbus A-400M, a transport plane designed to fill the niche

between the long-range C-17 that is part of the U.S. strategic fleet and the smaller

C-130, which is designed for transport within a theater of operations. After many

delays, the project is now moving forward. Seven European allies plan to purchase

225 of the A-400 aircraft by 2007.

Paying to modernize existing forces while procuring additional mobility

capabilities is likely to strain European defense budgets. Increasing those budgets

could ease that strain, but there appears to be little sentiment in Europe to take that

step. Instead, the major European militaries are restructuring their forces to perform

new out-of-area operations without substantially increasing defense spending. 

For example, Britain’s 1998 Strategic Defense Review restructures the

military away from territorial defense of the alliance to units that can be deployed

outside alliance territory, and it emphasizes “jointness” among military services to

increase the capability of existing forces. The review also relies on savings from

defense business reforms to help underwrite the cost of those new capabilities.

French officials have held up the British example as one they hope to follow in

developing a more mobile force capable of projecting power.

A key part of restructuring across Europe is reducing the size of the armed

forces. Many allies are eliminating or severely restricting conscription and instead

developing all-volunteer forces. France is abolishing conscription and cutting the
20 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

1. The members of the European Union are Austria, Belgium, Denmark, Finland, France, Germany,

Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and the United

Kingdom. All except Austria, Finland, Ireland, and Sweden are NATO members. All NATO members

except Canada, the Czech Republic, Hungary, Iceland, Norway, Poland, Turkey, and the United States

are members of the European Union. 

size of its armed forces from 500,000 to about 375,000 personnel, including the

paramilitary gendarmarie. Belgium and the Netherlands also have abolished the

draft, and Germany plans to drastically reduce its number of conscripts. Those

changes are intended to produce better trained, professional militaries that are more

suited to NATO’s post-Cold War mission.

Over the past decade, the member states of the European Union (EU) have

ceded important national powers to EU institutions.1 Fiscal policy, control of

borders, trade policy, and environmental regulation are some of the most prominent

areas in which the EU’s power has expanded at the expense of that of the national

governments. That increasing transfer of power will likely affect European defense

spending and burdensharing. Most important is the development of the European

Security and Defense Policy (ESDP), which aims to provide the EU with an

autonomous defense capability outside of NATO.

During the course of Operation Allied Force in Kosovo, the European allies

were struck by the wide divergence between the United States’ and Europe’s

respective capabilities in precision bombing, stealth aircraft, intelligence, and airlift.

The European allies were also frustrated by their inability to take action in Kosovo

without U.S. leadership. As a result, in December 1999 the member states of the

European Union declared their intention to build by 2003 a multinational force of

60,000 troops capable of deploying rapidly and remaining in place for up to one year.

The ESDP is intended to develop European capabilities in those areas so that the

Europeans can undertake peacekeeping and other military operations outside of, but

not necessarily independently of, NATO.

Some analysts view the ESDP as a positive development that will assist the

European allies in shouldering more of the burden of the common defense. They

argue that the United States has long encouraged its European partners to develop

greater capabilities, and that the policy is simply the necessary organizational prelude

to the European fulfillment of that longstanding goal.

Other observers, however, are skeptical of the ESDP’s potential. They argue

that unless overall defense spending increases dramatically, funding for the ESDP is

likely to drain assets that would otherwise go toward NATO. The main issue that

relegated Europe to a relatively minor role in Kosovo was the lack of stealth aircraft,

precision-guided munitions, and other sophisticated items. Boosting procurement to
CHAPTER II LIKELY TRENDS IN BURDENSHARING 21

fill that gap will be expensive, and there are no plans in the near term to raise defense

spending significantly in Europe.

U.S. officials question the intentions of the European allies in building a force

outside of NATO when defense capabilities could be developed within NATO. The

strategic concept developed at the April 1999 Washington NATO Summit outlined

a “European Security and Defense Identity” subordinated to, and developed within,

the NATO framework. Yet a few months later in a meeting of the European Union’s

member states, the ESDP was declared to be a means of endowing the European

Union with a military capability independent of NATO. That sparked controversy

in the United States as some analysts and Members of Congress believed that it was

an attempt to weaken the Atlantic alliance. Although the European allies have

assured the United States that the ESDP is complementary and not competitive with

NATO, some U.S. officials question the necessity of a new institution outside of

NATO to meet European security needs.

Another factor that potentially affects European defense spending is the

establishment of the European Monetary Union in January 1999. Twelve members

of the European Union have established a joint currency, the euro. In doing so, they

have transferred control of their monetary policy to the European Central Bank and

have accepted restrictions on their fiscal policy—in particular, the ability to run

budget deficits. Among those countries are nine NATO members: Belgium, France,

Germany, Greece, Italy, Luxembourg, the Netherlands, Portugal, and Spain (the

others are Austria, Finland, and Ireland).

It is too early to determine what effect European integration will have on

NATO. The increasing political integration of Europe could speed the development

of European forces capable of carrying out the EU’s defense policy. In that case,

Europe would gain both the confidence and the desire to take on a larger role in its

own defense, leading to greater European defense spending. That could result in a

stronger European component of NATO and more equitable burdensharing, or it

could weaken the role of NATO as the European countries downplayed the

importance of the Atlantic alliance and sought a more independent security policy of

their own.

CHAPTER III

PAYING FOR NATO’S COMMON COSTS

In planning for the common defense of the alliance, NATO mainly relies on the

national military capabilities of its members. But some common costs of the alliance

must be apportioned among the allies, such as maintaining a professional civilian

staff, a joint military headquarters, and pipeline systems to ensure the distribution of

petroleum products needed for military use in times of crisis or war. To pay those

costs, NATO has created three common budgets and has set shares that each member

is to pay: 

o The civil budget pays the cost of the civil headquarters and personnel in

Brussels. 

o The military budget pays for the alliance’s military headquarters and

activities, including the Supreme Headquarters Allied Powers Europe in

Mons, Belgium, as well as the NATO Airborne Early Warning and Control

program.

o The infrastructure budget, known as the NATO Security Investment Program

(NSIP), allows the alliance to underwrite the cost of support facilities,

including command, control, communications, and intelligence facilities;

transportation; and storage facilities.

Compared with the nearly $470 billion that the NATO countries spend on

defense each year, the common budgets represent a relatively minor expenditure. In

1999, the civil budget was $161 million; the military budget, $496 million; and the

NSIP budget, $458 million (see Table 5).

The cost shares that each member pays are determined by consensus among

the allies and typically change only after the addition of members or as a result of

new contingencies. The civil budget cost shares have remained relatively constant

since 1955 and the military budget cost shares since 1966. The NSIP cost shares,

however, have been reviewed more frequently because those funds are used for

specific construction projects.

France, which does not participate in NATO’s integrated military command,

opts out of many activities funded through the common budgets. When France does

not participate, other countries pay a prorated larger share of the military and the

NSIP budgets. Spain joined the integrated command in 1998 and now pays more

toward the common budgets. Countries can also negotiate changes in their shares.
24 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

For example, in 1994 Canada persuaded several allies to assume half of its NSIP

share.

The U.S. share of the civil and military budgets has stayed around 25 percent

since the budgets were established in 1951. The addition of Poland, Hungary, and

the Czech Republic to NATO reduced the U.S. share of the civil budget from 23.3

percent to 22.5 percent and the military budget from 28.0 percent to 26.2 percent.

The U.S. share of the NSIP budget fell from 28.3 percent to 25.2 percent.

TABLE 5. ALLIED CONTRIBUTIONS TO NATO’S COMMON BUDGETS IN 1999

(In millions of 1999 U.S. dollars)

NSIP Militarya Civil

Percentage

of Total

NATO

Budget

Belgium 21.1 15.5 4.4 3.7

Canada 16.1 29.0 8.6 4.8

Czech Republic 0.2 3.8 1.4 0.5

Denmark 16.9 9.2 2.4 2.6

France 34.3 29.3 24.7 7.9

Germany 108.0 85.5 25.0 19.6

Greece 4.2 2.1 0.6 0.6

Hungary 0.1 2.7 1.0 0.3

Iceland 0 0.2 0.1 0

Italy 36.1 32.9 9.3 7.0

Luxembourg 0.9 0.5 0.1 0.1

Netherlands 25.0 15.5 4.4 4.0

Norway 13.2 6.4 1.8 1.9

Poland 0.5 10.3 4.0 1.3

Portugal 1.5 3.5 1.0 0.5

Spain 6.5 19.5 5.6 2.8

Turkey 4.6 8.8 2.6 1.4

United Kingdom 53.6 91.3 27.9 15.5

United States 115.2 129.7 36.2 25.2

Totala 458.0 495.7 161.1 100.0

SOURCE: Department of Defense.

NOTE: NATO = North Atlantic Treaty Organization; NSIP = National Security Investment Program.

a. Does not include contributions to NATO’s Airborne Early Warning and Control program.
CHAPTER III PAYING FOR NATO’S COMMON COSTS 25

DETERMINING NATO’S INFRASTRUCTURE BUDGET

Whereas the military and civil budgets pay for the maintenance of NATO’s

bureaucracy and infrastructure, the NSIP budget may be spent on a variety of

projects. The NSIP planning process begins with the head of one of NATO’s two

force commands, always an American flag officer, deciding what projects are needed

for a given “capability package” to carry out a particular mission. The proposed

projects are screened by NATO’s senior resource board, which reviews the financial

aspects. The program is then authorized by the North Atlantic Council, NATO’s top

decisionmaking body.

The size of the NSIP budget is proposed by NATO’s military and civilian

staff, but ultimately its scope is determined by the amount that the alliance members

appropriate to it. In that regard, the U.S. Congress and its two appropriations

subcommittees on military construction are significant players. In most years, the

Congress appropriates less in NSIP funding than the President requests.

The NSIP funds operational facilities that fulfill a commitment to NATO that

is beyond a country’s national requirements for defense—for example, a radar facility

that is part of NATO’s common air-defense system. Because all U.S. operational

facilities in Europe are part of the American contribution to NATO, they all are

eligible for NSIP funding; many European countries’ facilities are considered

national requirements and hence are ineligible.

COMMON BUDGETS AFTER ENLARGEMENT

The addition of three new members to NATO in 1999 slightly reduced the financial

burden for most of the allies. Of the new allies, Poland paid 1.3 percent of the

common costs; Hungary, 0.3 percent; and the Czech Republic, 0.5 percent. NATO’s

senior resource board determined those shares largely on the basis of each country’s

gross domestic product. As a result of that reapportionment, most allies—including

the United States, the United Kingdom, and Germany—saw a slight reduction in their

cost shares.

The common costs of enlargement—which NATO has estimated at $1.5

billion over 10 years—will be shared by the allies through the military budget and the

NSIP. Of those costs, $1.3 billion is for infrastructure improvements that are to be

paid by the NSIP. The U.S. share of that cost will be approximately $400 million—or

roughly one-fourth—over 10 years.
26 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

The commonly funded improvements fall into four broad categories:

o Communication links to the new allies. Those links are needed to connect

the defense ministries and military headquarters in the Central European

countries with one another and with those in the other allied capitals. Those

links include fiber-optic cables and satellite links, the latter being particularly

necessary in the case of Hungary, which does not border any other NATO

member.

o Air-defense systems, including radars on the ground and links to NATO’s

integrated air-defense system. Those improvements will help the alliance

gain a complete picture of the skies over the enlarged NATO territory.

o Airfield improvements so that bases in the three new allied countries can

accommodate other allies’ aircraft. Improvements include lengthening

runways and constructing reception areas so that transport aircraft can

reinforce a new ally in a crisis. They also will enable the new allies, relying

on other countries’ lift capabilities, to move their forces to reinforce another

ally facing a threat. In addition, some improvements—such as water pipe

connectors and electrical sockets—are needed at Polish naval facilities to

install compatible equipment that will allow them to unload and resupply

NATO ships while they are in port.

o Training ranges, to enable the new allies to conduct exercises with other

NATO members.

The Clinton Administration’s budget for fiscal year 2001 requested $12

million for NATO’s enlargement. The DoD enlargement study anticipated a request

of $32 million for enlargement costs in 2002, with those costs peaking in 2005 at

about $70 million and then decreasing through 2008. The Congress appropriates

funding for the NSIP out of the Military Construction Appropriations Act and

funding for the military budget out of the Army Operations and Maintenance account

in the Defense Appropriations Act. The Congress appropriated $172 million for the

NSIP and $119 million for the NATO military budget in fiscal year 2001.

Although enlargement is expected to cost $1.5 billion over the next 10 years,

it is not yet clear what its net effect will be on the overall common budgets. U.S.

officials at the Pentagon and in Brussels have indicated that the NATO infrastructure

budget could remain fairly constant over the next several years at about $800 million

a year. In 1993, NATO redirected NSIP funding toward projects that increase force

mobility and flexibility, reducing the amount it spends on other projects. Because of

that adjustment, it is unlikely that U.S. payments to the NSIP will increase in the near

term.
CHAPTER III PAYING FOR NATO’S COMMON COSTS 27

NSIP FUNDING OF U.S. INSTALLATIONS IN EUROPE

As noted earlier, nearly all U.S. operational installations in Europe are eligible for

NSIP funding because they are used to carry out the U.S. commitment to NATO

rather than purely national military operations. The U.S. Mission to NATO estimates

that in most years the United States receives greater funding for its activities in

Europe than it pays into the infrastructure fund. For instance, the NSIP spent roughly

$685 million in 1999 on activities that benefited U.S. forces, compared with the

American contribution of $400 million. Over the 10 years ending in 1999, U.S.

facilities received approximately $4.1 billion from the NSIP, while the United States

contributed $2.7 billion to the program. U.S. officials calculate that this country

received more money for its installations than it paid into the NSIP in every year of

the past decade except 1994.

An example of the benefit the United States receives from the NSIP is

improvements to the air base at Aviano, Italy, the main base for air operations over

Kosovo and Serbia during the Kosovo conflict. NATO opted to pay for some

nonoperational facilities that support U.S. forces and their families at the base that

would not normally be eligible. American officials estimate that securing NSIP

funding for those projects ultimately saved American taxpayers about $190 million.

NATO’S AIRBORNE EARLY WARNING AND CONTROL PROGRAM

In addition to covering the cost of the alliance’s military headquarters, the common

NATO military budget funds the operation and modernization of the NATO Airborne

Early Warning and Control program. Through this program, NATO jointly owns and

operates a fleet of 18 E-3A airborne warning and control system (AWACS) planes

and two Boeing 707 trainers. The main operating base for the program is at

Geilenkirchen, Germany, with some planes stationed at bases in Italy, Turkey,

Greece, and Norway. Those aircraft, which were used to support NATO operations

in Bosnia and Kosovo, provide an early-warning system against low-level aircraft,

manage air traffic, and assist close air support as well as search and rescue

operations. The operation of the AWACS program is funded out of an annual

common NATO budget that is divided among the participating countries; in 2000,

the U.S. share was 40 percent ($66 million) of the total $166 million.

Proponents of the AWACS program point to it as a successful example of

burdensharing within the alliance; the operating crews and support personnel are

perhaps NATO’s best-integrated international unit. Some U.S. and allied officials

believe that it provides a possible template for coordinating other common assets.
28 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

Common assets could save money by avoiding unnecessary overlap in

national capabilities, especially in support functions. That could prove particularly

advantageous to the United States, which provides much of NATO’s airlift;

intelligence; and command, control, and communications capabilities. If the alliance

as a whole provided those capabilities, the United States could realize some cost

savings without diminishing NATO’s capabilities.

Despite the potential cost savings, the United States may prefer to maintain

a national capability in support functions. Common assets would require consensus

in the alliance before they could be deployed, which could limit the United States’

ability to act unilaterally. Under the Combined Joint Task Force (CJTF) concept, a

“coalition of the willing,” comprising a subset of NATO members, can use alliance

assets for out-of-area missions with the consensus of all 19 member countries. While

the CJTF concept dates only to 1996 and remains in large part theoretical, it appears

that one ally could block use of alliance assets for a given mission. So even though

common capabilities offer the benefit of cost savings, forgoing national capabilities

could result in this country’s ability to act being constricted by allied opposition.
APPENDIX A

SUPPLEMENTARY DATA ON DEFENSE SPENDING

AND ECONOMIC AID

The following tables present statistics on defense spending and on economic aid to

the countries of Central and Eastern Europe. Some of these statistics are shown in

graphic form in the text; the tables here provide supplemental detail.
30 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

TABLE A-1. DEFENSE SPENDING AS A PERCENTAGE OF GROSS DOMESTIC 

PRODUCT IN SELECTED YEARS, 1980-2000

1980 1985 1990 1995 1996 1997 1998 1999 2000a

Belgium 3.3 3.0 2.4 1.6 1.6 1.5 1.5 1.4 1.4

Canada 1.9 2.2 2.0 1.5 1.4 1.2 1.3 1.3 1.2

Czech Republicb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 2.2 2.3

Denmark 2.4 2.2 2.0 1.7 1.7 1.7 1.6 1.6 1.5

France 4.0 4.1 3.6 3.1 3.0 2.9 2.8 2.7 2.7

Germany 3.3 3.2 2.8 1.7 1.6 1.6 1.5 1.5 1.5

Greece 5.7 7.1 5.8 4.4 4.5 4.6 4.8 4.8 4.9

Hungaryb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 1.6 1.7

Italy 2.4 2.7 2.1 1.8 1.9 2.0 2.0 2.0 1.9

Luxembourg 1.0 1.1 1.1 0.8 0.8 0.8 0.8 0.8 0.7

Netherlands 3.1 3.1 2.7 2.0 1.9 1.8 1.7 1.8 1.6

Norway 2.9 3.3 3.2 2.4 2.2 2.1 2.3 2.2 1.9

Polandb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 2.0 2.0

Portugal 3.5 3.1 3.1 2.6 2.4 2.4 2.2 2.2 2.2

Spainc n.a. 2.7 1.8 1.5 1.4 1.4 1.3 1.3 1.3

Turkey 4.7 4.5 4.9 3.9 4.1 4.1 4.4 5.4 6.0

United Kingdom 5.0 5.3 4.0 3.0 3.0 2.7 2.7 2.5 2.4

United States 5.1 6.7 5.7 3.8 3.5 3.3 3.1 3.0 3.0

NATO Average 3.5 3.6 3.1 2.4 2.3 2.3 2.3 2.2 2.2

NATO European 

Averaged 3.4 3.5 3.0 2.3 2.3 2.3 2.3 2.3 2.3

SOURCE: Congressional Budget Office based on data from the North Atlantic Treaty Organization (NATO).

NOTES: n.a. = not applicable.

Averages are weighted by GDP.

Iceland is excluded because it has no armed forces.

a. Estimated by NATO on the basis of available data.

b. Poland, Hungary, and the Czech Republic did not join NATO until 1999.

c. Spain did not join NATO until 1982.

d. Excludes the United States and Canada.
APPENDIX A SUPPLEMENTARY DATA ON DEFENSE SPENDING AND ECONOMIC AID 31

TABLE A-2. DEFENSE SPENDING PER CAPITA IN SELECTED YEARS, 1980-2000

(In 1995 U.S. Dollars)

1980 1985 1990 1995 1996 1997 1998 1999 2000a

Belgium 619 613 597 438 431 426 423 426 427

Canada 306 386 387 309 278 257 277 285 265

Czech Republicb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 115 120

Denmark 613 619 641 596 591 595 594 587 567

France 821 888 910 822 803 802 776 780 785

Germany 859 895 892 504 495 481 482 490 484

Greece 452 576 504 484 516 542 587 609 633

Hungaryb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 84 91

Italy 324 365 387 338 340 336 343 350 343

Luxembourg 240 265 330 345 354 375 397 399 397

Netherlands 581 628 631 518 524 517 509 529 500

Norway 699 841 887 805 809 793 840 831 809

Polandb n.a. n.a. n.a. n.a. n.a. n.a. n.a. 83 85

Portugal 217 204 264 269 260 265 255 267 273

Spainc n.a. 262 248 221 215 217 212 213 225

Turkey 83 80 106 107 113 117 119 123 136

United Kingdom 778 860 768 577 578 541 546 534 526

United States 1,144 1,467 1,423 1,061 1,002 985 950 947 968

NATO Average 758 905 886 670 645 634 621 582 589

NATO European 

Averaged 547 582 573 447 443 435 433 394 394

SOURCE: Congressional Budget Office based on data from the North Atlantic Treaty Organization (NATO).

NOTES: n.a. = not applicable.

Iceland is excluded because it has no armed forces.

Calculations are based on weighted averages.

a. Estimated by NATO on the basis of available data.

b. Poland, Hungary, and the Czech Republic did not join NATO until 1999.

c. Spain did not join NATO until 1982.

d. Excludes the United States and Canada.
32 NATO BURDENSHARING AFTER ENLARGEMENT August 2001

TABLE A-3. NATO MEMBERS’ ECONOMIC AID TO CENTRAL AND EASTERN 

EUROPE PER MILLION DOLLARS OF THEIR GROSS DOMESTIC 

PRODUCT IN SELECTED YEARS, 1991-1997

1997 1991-1997

ODA

Grants Loans Total

ODA

 Grants Loans Total

Belgium 44.1 0 44.1 159.8 58.0 217.8

Canada 248.3 0 248.3 251.0 0 251.0

Denmark 486.4 85.1 571.5 490.3 108.6 599.0

France 217.8 3.3 221.1 213.4 5.6 219.0

Germany 184.6 23.6 208.2 1,078.1 51.5 1,129.5

Greece 0 0 0 0 0 0

Iceland N.A. N.A. N.A. N.A. N.A. N.A.

Italy 22.3 11.9 34.2 98.4 11.1 109.5

Luxembourg 200.0 0 200.0 194.7 0 194.7

Netherlands 92.0 0 92.0 184.1 33.2 217.4

Norway 419.9 0 419.9 416.0 16.0 432.0

Portugal 2.5 0 2.5 1.3 0 1.3

Spain 5.4 -0.6 4.8 3.4 4.3 7.7

Turkey 0 0 0 0 0 0

United Kingdom 122.7 0 122.7 106.5 0 106.5

United States 166.0 6.9 173.0 225.4 19.2 244.6

NATO Average 147.5 8.7 156.2 228.2 20.5 248.7

NATO European 

Averagea 138.3 9.5 147.8 226.6 22.2 248.8

SOURCE: Congressional Budget Office based on data from the Organization for Economic Cooperation and Development.

NOTES: N.A. = not available; ODA = official development assistance.

Poland, Hungary, and the Czech Republic did not join NATO until 1999.

a. Excludes the United States and Canada.
APPENDIX B

INFORMATION ABOUT DATA SOURCES

The data in this report are based on information from the North Atlantic Treaty

Organization (NATO), the U.S. Mission to NATO, the U.S. Department of Defense

(DoD), the International Institute for Strategic Studies (IISS), the Organization for

Economic Cooperation and Development (OECD), the International Monetary Fund

(IMF), the General Accounting Office (GAO), the Congressional Research Service

(CRS), foreign governments, and the Congressional Budget Office’s (CBO’s) own

projections and reports.

Data on defense spending and military personnel levels from 1975 to 1998

came from the NATO publication Financial and Economic Data Relating to NATO

Defense. Earlier data came from a previous CBO paper on burdensharing—

Assessing Future Trends in the Defense Burdens of Western Nations (April

1993)—as well as CBO testimony from 1998.

Figures on NATO’s reaction forces came from DoD. Force levels in Bosnia

for the implementation force and stabilization force missions came from CRS and

DoD. Population figures came from the IMF publication International Financial

Statistics Yearbook 2000. Figures on official assistance to Central and Eastern

Europe were obtained from the OECD’s Web site, and historical gross domestic

product figures from 1991 through 1997 came from IISS.

Data on NATO’s common budgets and cost shares came from the 1998 GAO

report NATO: History of Common Budget Cost Shares, DoD, and the U.S. Mission

to NATO. That mission also provided its estimate of the benefits provided to U.S.

facilities.


This paper and other CBO publications are 

available at CBO's Web site:

www.cbo.gov