NATO Secretary General Mark Rutte's proposal to raise the alliance's defense spending target to 5 percent of GDP by 2035, up from the 2 percent benchmark that most members have only recently begun to meet, would have been dismissed as fantasy three years ago. It is now the subject of serious budget planning in Berlin, Paris, Warsaw, and a dozen other European capitals.

The numbers alone signal a transformation. Five percent of GDP for a country like Germany would mean an annual defense budget exceeding $250 billion, more than Russia currently spends. For the alliance as a whole, it would represent a military investment on a scale not seen since the Cold War.

Whether Europe will actually reach these numbers is uncertain. That the conversation has shifted from 2 percent, a target most allies treated as aspirational for two decades, to 5 percent tells you everything about how fundamentally the strategic landscape has changed.

What Changed

Three developments, converging in the same period, have made European rearmament urgent in a way that years of American complaints could not.

The first is the war in Ukraine, now in its fourth year, which demonstrated that large-scale conventional warfare on the European continent is not a historical curiosity but a present reality. European militaries discovered that their ammunition stocks could be exhausted in weeks, their procurement systems could not surge production, and their force structures were designed for expeditionary peacekeeping rather than territorial defense.

The second is the new U.S. National Defense Strategy, which explicitly deprioritizes Europe as a theater and shifts American military focus to the Indo-Pacific. This is not a threat or a negotiating tactic. It is a strategic judgment that China represents a greater long-term challenge than Russia, and that the United States cannot maintain dominant military posture in both theaters simultaneously.

The third is the Iran conflict, which has absorbed American military attention, naval assets, and political bandwidth at precisely the moment when Russian drones are violating Polish and Estonian airspace with increasing frequency. The message is unmistakable: the United States has commitments elsewhere, and Europe must be prepared to handle Russian provocations without assuming that American forces will be available as the first responder.

Germany's Pivot

Germany's response has been the most significant, both because of its economic weight and because of the historical magnitude of the shift. The country that spent decades deliberately constraining its military capability, as both penance for the twentieth century and as a political strategy for maintaining European leadership through economic rather than military power, is now the continent's most important defense investor.

Berlin's $83 billion annual defense budget is being restructured around domestic and European procurement rather than American systems. Only 8 percent of Germany's current procurement spending flows to U.S. defense contractors. a deliberate choice to build European industrial capacity and to reduce dependence on an ally whose reliability is no longer taken for granted.

This is rational behavior, and Washington should recognize it as such rather than treating it as an affront. An ally that can produce its own ammunition, maintain its own equipment, and deploy its own forces without American logistics support is a more capable partner, not a less loyal one.

The Rutte Target

Rutte's 5 percent proposal is structured as 3.5 percent for core defense spending (personnel, equipment, operations, and maintenance) plus 1.5 percent for broader security-related expenditures including cybersecurity, critical infrastructure protection, and defense-industrial base development.

The inclusion of the broader security category is both pragmatic and politically necessary. Pragmatic because the threats facing Europe increasingly include cyberattacks, infrastructure sabotage, and information warfare that do not fit neatly into traditional defense budgets. Politically necessary because counting these expenditures makes the 5 percent target achievable for countries that would struggle to spend that much on tanks and aircraft alone.

Critics will note that creative accounting has been a persistent problem with NATO spending targets: countries have long padded their defense budgets with pensions, civilian research, and other items of questionable military value. Rutte's framework at least attempts to define what counts and what does not, even if enforcement will remain a challenge.

The Russia Factor

The urgency is not theoretical. Russian airspace violations have increased markedly in recent months. Approximately 20 Russian drones intruded into Polish airspace in a single incident. Three Russian MiG-31 fighters violated Estonian airspace for 12 minutes, long enough to demonstrate capability and intent but short enough to avoid triggering a formal Article 5 response.

These incursions are tests, and Moscow is watching the responses carefully. A Europe that is rearming and demonstrating political will to respond is a Europe that deters further escalation. A Europe that talks about defense spending while maintaining hollow force structures is one that invites exactly the kind of probing that has already begun.

The question for the next decade is whether European defense spending produces actual capability (deployable forces, functioning logistics, interoperable systems, adequate ammunition stocks) or merely produces larger budgets. The history of European defense promises is not encouraging. But the strategic environment has never provided such powerful incentives to follow through.

For the first time since 1991, Europe is rearming because it believes it has no choice. That may be exactly what was needed.