Following the reluctance of many traditional American allies to become involved in the war against Iran, Donald Trump is once again threatening to withdraw the US from Nato. “They haven’t been friends when we needed them,” he said in an interview with Reuters on April 1. “We’ve never asked them for much … it’s a one-way street.”
To be sure, membership in Nato does impose some costs on the US. Washington pays roughly US$750 million (£568 million) per year in direct costs to keep the organisation running, and a further US$4 billion or so towards the European Deterrence Initiative. This initiative rotates some US forces in and out of Europe to deter Russian aggression.
There are also other US forces stationed permanently in Germany and various other European countries, including the UK and Italy. The cost to the US of keeping these forces where they are is comparable to the cost of basing them at home.
For a global superpower which is finding it increasingly difficult to maintain a robust military presence in every region of the world, these costs are not negligible – particularly when some of them could be taken on by wealthy European countries themselves.
But, at the same time, it is hard to justify Trump’s belief that Nato is a “one-way street”. The US derives many benefits from the existence of Nato, which generations of American strategists, military officers and diplomats have viewed as worthwhile.
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Following the first and second world wars, US presidents concluded that allowing Europe to be dominated either by recurrent cycles of conflict or a single hostile power was unacceptable. The American economy could not prosper without transatlantic trade and investment, and the US could not be secure if one of the great centres of global wealth and power was in hostile hands.
Founded in 1949, Nato was intended to be a stabilising force that avoided these outcomes. Its primary purpose is to deter aggression against any of its 32 member states, with Article 5 of the alliance stating that an armed attack against one Nato member shall be considered an attack against them all.
The world has changed since Nato’s founding, but the importance of European stability to the US economy remains. Europe is a key market for many American companies. In 2024, the US exported nearly US$295 billion in services and US$414 billion in goods to the EU – figures that are together equivalent to about 80% of the entire US defence budget that year.
By providing European countries with solid security guarantees, Nato remains vital to maintaining the stability which underpins this economic relationship. It deters Russia from military forays into eastern Europe and the Baltics and helps to prevent the catastrophic descent into European war that occurred so frequently in the centuries before the alliance was founded.
American defence guarantees also mean that most European allies do not feel the need to develop their own arsenal of nuclear weapons – a step that could unleash a dangerous arms race.
Defending US interests
These benefits may seem intangible because they mostly concern things that, since Nato’s formation, have not happened. But at the same time, the alliance provides plenty of direct, tangible benefits to the US as well. For instance, Nato provides the US with the means to defend its interests in other regions of the world.
Through the alliance, the US has access to a network of strategically located naval, air and ground force bases which can be used to project power into the Middle East, Africa and central Asia. For instance, the US has used RAF Fairford in the UK to support operations in the current conflict in Iran.
Nato allies frequently contribute capabilities to US military missions too, or carry out tasks that the US would have to perform if Europeans were not doing them. Tens of thousands of Nato soldiers fought in Afghanistan, for example, with over 1,000 of these people losing their lives. Nato sailors also patrol the Atlantic Ocean, keeping trade flowing.
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The US’s Nato partners are also stepping up their contributions to Arctic security, a key demand of the Trump administration. In addition, many Nato members have specialised capabilities in cyber warfare or intelligence collection, which the US would struggle to replicate.
Nato provides a unified and durable framework in which this cooperation can occur. The US does not have to renegotiate its defence relationship with each of the 31 other Nato states constantly. Instead, all members of the alliance invest in equipment and capabilities which are able to be integrated into one common battle plan.
Finally, Nato serves as a springboard for unified diplomacy. Countries that are aligned in their defence policies are likely to be aligned diplomatically, too. Thus, the US has a ready made stable of allies to draw on if tensions rise with any non-Nato country. And if the situation deteriorates to the point that conflict looks likely, the alliance provides the basis for coordinating increased defence spending and, ultimately, war-fighting.
None of this means that Nato will necessarily follow the US into every conflict. But to dismantle an alliance that brings such profound benefits to the US over one disagreement would be a shame. It would perhaps be better for Trump to appreciate one key virtue of close friends and allies – that they are willing to tell you when you are making a mistake.
