Europe and Germany cannot take timely and sufficient American support for Ukraine for granted. Partisan-political divisions and the prospect of a second Trump administration are creating heightened uncertainty. Brussels and Berlin should make it clear to both American policymakers and legislators that Europe has thus far provided far more total aid than Ukraine than America. They should also emphasize that US support is highly cost-effective in terms of America’s broader, China-focused national security strategy.
The Biden administration’s request for an additional $60 billion of Ukraine aid remains tied up in a hyper-partisan Congress. Worse, a second Trump administration may threaten to reduce or even withhold further Ukraine aid altogether, possibly in an attempt to force Europe to increase its support. To the extent that transatlantic disagreement over cost sharing is amenable to rational argument, Europe should emphasize two important points in its negotiations with America: Europe has already committed to providing much more aid to Ukraine than America; and American aid generates significant economic and strategic benefits to the United States at a comparatively small cost, while a reduction, let a alone complete withdrawal in aid would jeopardize Washington’s broader strategy goals.
Europe has committed far greater resources to Ukraine than America
As of October 2023, EU countries, directly and indirectly, have committed about twice as much military, financial and humanitarian aid to Ukraine than America. According to the Kiel Institute for the World Economy, total commitments by EU countries and EU institutions have amounted to $133 billion, compared to $72 billion since the beginning of the war in February 2022. The United States is the largest single provider of total aid ($71 billion) as well as military aid and assistance ($44 billion), followed by Germany (total aid: $21 billion/ military aid: $17 billion) and the UK (total aid: $13 billion/ military aid: $7 billion). As a share of GDP, however, Lithuania and Estonia have been the most generous providers of aid worth 1.8%. By comparison, Germany has provided aid worth 0.9% of GDP (including through EU institutions) and the United States 0.3% of GDP.
If contributions were adjusted to take into account America’s slightly larger economy compared to the EU-27 (15.2% vs 14.3% of global GDP on a purchasing power parity basis) and its significantly higher per capita income ($80,000 vs $57,000 in PPP terms), Europe’s relative “adjusted” share would be even greater than what is implied by dollar contributions alone. Any transatlantic discussion of how to share the cost of support in future should start from an acknowledgment that Europe is committing far greater resources to support Ukraine than America. Far from free-riding, Europe is pulling its weight.
America’s Support for Ukraine is Highly Cost-Effective in Terms of its Broader Strategic Goals
A second issue European should emphasize is that America derives significant economic and strategic benefits from supporting Ukraine, and it does so at a relatively low cost. Financially, American aid is small, amounting to a little more little more than $70 billion since the start of the, or less than 0.15% of GDP on an annual basis. The $60 billion of additional aid requested by the Biden administration would amount to another 0.2% of GDP in 2024. To put this into perspective, a sustained 100 basis point increase in US interest rates costs the US taxpayer $260 billion, annually.
Economically, Ukraine aid is not simply “money out of the door”. American aid, unlike EU aid, consists primarily of military aid and assistance. To the extent that military aid comes out of new production rather than existing stockpiles, the money flows directly to the US defense industry and US workers. According to the American Enterprise Institute, 90% of the funds spent stay in the United States. To the extent, however, that aid is financed by debt issuance, the American taxpayer is ultimately accountable for servicing it. But 0.15-0.2% of GDP worth of additional annual spending is as close to a rounding error in GDP terms as it gets.
Strategically, US military aid helps maintain the balance of conventional military power in Eastern Europe, and thus stability and security in Europe. From Washington’s point of view, it does more than that: it weakens Russia strategically. Leaving aside Russian losses in equipment and personnel as well as the impact of sanctions, the continued flow of Western aid to Ukraine is forcing Russia to increase “unproductive” military expenditure, thereby reducing the ability to invest to support long-term economic development. Russia’s trend growth has already decelerated to less than 1% over the past decade, and it is set to decline further, thereby weakening the country’s strategic position.
Keeping Russia at bay militarily in Ukraine is consistent with, and conducive to America’s primary strategic goal, as articulated in the National Security Strategies of both the Trump and Biden administrations: countering China. The war in Ukraine has led Moscow and Beijing to form a closer relationship. Preventing Russian from making gains in Eastern Europe is therefore in America’s best interest in terms of its broader national security strategy. From Washington’s point of view, spending less than 0.2% of GDP a year to prevent Russia, China’s major international partner, from making gains in Ukraine is simply efficient and effective strategy.
Reducing US Support for Ukraine Would Be Nothing Short of an Unforced Strategic Error
A second Trump administration may wager that a reduction of American aid will force the Europeans to increase their support and such a move would not fundamentally change the prospect of Russian gains in Ukraine. After all, Europeans feel more immediately threatened by the war in Ukraine than America. But this is a risky approach to take. A substantial reduction in aid would benefit Russia and might allow it to make military gains. And even if American aid does come through in the end, uncertainty about the availability and timing of future funding might undermine morale in Kyiv and embolden Moscow. Withholding Ukraine is also risky because Europeans, who have delivered more financial than military aid, are not well-placed to replace shipments of US military equipment necessary to support Ukraine effectively.
Washington might insist that Europeans purchase the necessary defense goods from America. But this would lead America to incur significant reputational costs in the eyes of its European and Asian allies. Uncertainty over America’s commitments to its security alliances would increase and weaken America’s geo-strategic position in East Asia. So even if the Europeans manage to increase their financial support to the level required to preserve the military balance in the Ukraine – and it is far from clear that this will happen – withholding or substantially scaling back American support for Ukraine looks like an unforced strategic error in the making.
Should serious transatlantic disagreement over Ukraine funding emerge, then Europe would do well to point to the significant support it has provided thus far. It should also remind America of the significant strategic and reputational costs it would incur and of the very limited financial savings a reduction of US support would generate if it were to sharply reduce or withhold support altogether. These argument may not sway ideologues among policymakers, nor congresswomen (sic!) under electoral pressure. But they are squarely aimed at the Downsian median “voter” in Congress and pragmatic policymakers. Europeans must hope that America’s strategic interests prevail over populist, partisan domestic politics as well as some of its latest or not-so-latent unilateral-isolationist instincts.