ATLANTIC CHARTER 2025: A NEW NATO DEAL FOR AMERICA

 

“For the pace is hot and the points are near, And sleep has deadened the driver’s ear; And signals flash through the night in vain. Death is in charge of the Clattering Train”.

The Alphen Group, which I have the honour to chair, has drafted Atlantic Charter 2025: A New NATO Deal for America https://thealphengroup.com/2025/01/12/atlantic-charter-2025-a-new-nato-deal-for-america/ and which has been shared with very senior members of Washington’s incoming Administration.  

The Problem

Why await a train wreck when you can see it coming…and stop it! One does not have to look hard for the causes of European free-riding on the US.  In November 2024, the Frankfurter Allgemeine pointed out that whilst Europeans are 9.3% of the global population they spend 60% of the world’s expenditure on social welfare.  Add that fact to the combined effects of the 2008-2010 Banking and Financial Crisis, Brexit, COVID and the Russo-Ukraine War most European states are deeply indebted. This is why in this new age of nationalism those with power, such as America and China, play poker, whilst Europeans pretend they can play chess. Russia?  It just pretends it is powerful and is dangerous because of it.

Free-riding is about to come to a crashing halt with the inauguration of second-term President Donald J. Trump with NATO facing. However, the rebirth of appeasement in Europe’s Body Politic desperately hopes that covenants without the sword will be enough. It is an obsession with lawfare which increases rather than decreases the likelihood of warfare.  

The Challenge

Canadians and Europeans face three converging challenges that together require a renewed resource commitment to defence: 1) extreme Russian military aggressiveness and revanchism as displayed in Ukraine, and which if unchecked could extend beyond Ukraine, 2) rising Chinese military power and China’s ‘no limits’ partnership with Russia, and 3) the need to rapidly rebalance and redistribute NATO defence responsibilities in light of America’s growing global defence commitments.

While the Charter contains recommendations for detailed benchmarks, metrics, roadmaps, and force structure; its principal focus is to accelerate significantly Europe’s ability to execute SACEUR’s Family of Defence Plans and reduce today’s excessive dependence on the United States. This is consistent with President-elect Trump’s notion that European defence contributions are wholly inadequate to meet current and future needs.

Implemented properly, the recommendations in the Charter would significantly strengthen European defence capabilities and reduce worldwide pressures on American forces. Global security and transatlantic solidarity would be enhanced as a result. The implicit deal would be that America’s strong commitment to NATO’s Article 5 would be sustained in return for a European defence buildup leading to a more capable and balanced Alliance.

Resourcing the recommendations contained in the Charter will be difficult given European economic problems, so the Charter endorses the creation of a Defence, Security and Resilience (DSR) Bank designed to expedite and expand financing for NATO’s defence requirements going well beyond Allies’ 2024 defence investment pledge.

In addition. the Allies must commit themselves to helping Ukraine defeat Russian aggression as a critical requirement for the future of transatlantic security and preservation of the rules-based international order.  Therefore, it is vital NATO leaders at the June 2025 Summit in The Hague commit to rapidly building European and Canadian capabilities and thus consider creation of a new Defence, Security and Resilience Bank to help finance this effort.

The Mission

In August 1941, Prime Minister Winston Churchill and President Franklin Delano Roosevelt issued the Atlantic Charter which established a politico-military relationship which in time became the North Atlantic Treaty Organization and endures to this day.  The Charter was made credible by the March 1941 Lend-Lease Act which established the United States as the Arsenal of Democracy and enabled the British to maintain the fight against Nazism. The Charter was built on American potential – both economic and military.  Today, a new Atlantic Charter is needed built on European potential and greater European strategic responsibility within the broad framework of NATO.

 Atlantic Charter 2025 thus builds on the TAG Transatlantic Compact 2024 by looking beyond the debate over spending 2%, 3% or even 5% of GDP on defence by the Canadian and European Allies. To that end, the Charter focuses on the minimum military capabilities, capacities and structures NATO will need to do the job both implicit and explicit in SACEUR’s Family of Plans as adopted at the 2023 Vilnius Summit.  The Charter is also crucially based on a worst-case analysis of the contingencies and assumptions with which NATO’s defence and deterrence posture could have to contend.  

Critically, the Charter constitutes a New Deal for America in NATO because it envisions an Alliance built on strengthened European and Canadian forces and much greater interoperability with US forces in all contingencies. If adopted and implemented by America’s NATO Allies, with the support and encouragement of the United States, it would ease growing world-wide pressure on US forces and resources through a much-strengthened NATO European Pillar that would by 2030 be able to act as a high-end, first responder force in and around the European Theatre of Operations (ETO) and in all circumstances.  The reinforced European pillar would be balanced by a reconceived NATO North American pillar in which strengthened Canadian forces focus on high-end interoperability with their US counterparts with a particular focus on the Arctic and the North Atlantic.

Atlantic Charter 2025 is a reconfirmation of the Alliance’s critical importance to the security of all the Allies, including the United States, guiding the way for NATO transformation. The Charter thus offers a substantive roadmap with specific capacity benchmarks and metrics that calls upon the Allies to focus on the requirements necessitated by the new Russian threat and to reinforce and accelerate implementation of the Strategic Concept and the decisions made at the Madrid, Vilnius and Washington Summits, via more balanced and effective Alliance defence and deterrence.

 How can European allies that struggle to realize the 2% GDP target meet a defence investment challenge that implies an even greater financial commitment?  The answer is a new kind of Lend-Lease Deal. A Defence, Security and Resilience (DSR) Bank would provide demand-side financing for Nations by offering Collective Debt Issuance. The DSR Bank concept has been championed by the Atlantic Council and has been studied by NATO’s International Staff for five years. This Charter endorses the concept of a DSR Bank and urges NATO leaders to consider it at the June 2025 NATO summit. The DSR Bank would pool the creditworthiness of participating nations to raise funds in global financial markets. This collective debt would provide nations and defence industries with access to the cheapest possible financing (AAA credit rating) for long term, predictable and reliable defence procurement. A DSR Bank would also offer Loan Programmes. Funds raised would enable nations to purchase armaments, modernize defence systems, and invest in dual-use technologies without significantly increasing their direct public debt. This money would further complement existing defence budgets and any national contributions to the bank would support defence investment policy goals such as defence spending targets. 

The Caveats

 

There are caveats. First, if Europeans do share more of NATO’s many burdens, they will expect more say over how the Alliance operates.  The US cannot expect the same level of control it enjoys today.  Second, the quality of American leadership will also need to improve.  Afghanistan and Iraq damaged European trust in US leadership which was often poor. Third, increased European military capability cannot simply be a metaphor for ‘Buy American’.

 

There is one final caveat. Americans must also change their mindset. There is an apocryphal story from World War Two.  US tanks, such as the Sherman, were notoriously under-gunned in the face of Wehrmacht Panthers and Tigers.  To counter this problem the British came up with an ingenious solution. The British 17-pounder gun was the best anti-tank gun on the war. So, they put it into the Sherman chassis and called it the Sherman Firefly. It saved the lives of countless British and Canadian tankers in Normandy and beyond and became feared by their German counterparts.  The British also offered the adapted tank to the US but the Americans turned it down. US commanders claimed it was due to doctrinal differences and a desire to focus on inferior US guns, such as the 76mm.  The real reason was hubris and a refusal to believe an ally could have developed a superior weapon.  ‘Not invented here’ is a theme that has run through American leadership ever since. It has led at times to an exaggerated sense of American superiority and helped depress European military ambition. That too must end.  Who is in charge of the Clattering Train?

 

Julian Lindley-French