NATO’s place in the global economy

Make Me Smart February 20, 2024 Transcript

Note: Marketplace podcasts are meant to be heard, with emphasis, tone and audio elements a transcript can’t capture. Transcripts are generated using a combination of automated software and human transcribers, and may contain errors. Please check the corresponding audio before quoting it.

Kimberly Adams 

Hey everybody, I’m Kimberly Adams. Welcome back to Make Me Smart, where none of us is as smart as all of us.

Kai Ryssdal 

I’m Kai Ryssdal. Thanks for joining us, everybody on this Tuesday, the 20th of February. One show, one topic is what we do on Tuesdays. Today, we’re going to do NATO, the North Atlantic Treaty Organization for those of you unfamiliar It’s a 75ish or so year old military alliance that has been in the news of late. Thank you to the former president. And also, not coincidentally, sort of many of the things that are going on over in Europe anyway. We’re going to talk about that today.

Kimberly Adams 

Yeah, I mean, Trump made these comments saying, you know, that he wouldn’t mind changing up the way things go in NATO. And this has been dominating discussions, including at this big international security conference that happened in Munich over the weekend. People were talking about the US as possible withdrawal from NATO. But we want to take a little bit of a step back and look at how NATO is structured, how it works, why it’s so crucial right now. So, here to make a smart about all of this is Kathleen McInnes. She’s a senior fellow at the Center for Strategic and International Studies. Welcome to the show.

Kathleen McInnis 

Thank you so much for having me.

Kimberly Adams 

So why was NATO originally established? And talk us through how it came about.

Kathleen McInnis 

So, at the end of World War 2, the leaders of United States and Europe were sort of looking around at different security arrangements and noticing that the Soviet Union was becoming a more belligerent actor, to put it mildly. So, they started establishing this North Atlantic Treaty Organization to aggregate military capabilities, and to start holding the line against an aggressive and expansionist Soviet Union. I mean, the tagline for a lot of NATO’s lifespans was that NATO is founded to keep the Americans in. The Russians out. And the Germans down.

Kai Ryssdal 

Just use just historically explain that because maybe not everybody gets it.

Kathleen McInnis 

Well, yeah, so. Yeah. Well, the idea being that the Europeans needed the United States to remain engaged in Europe, and so having a Treaty Organization like NATO would help do that. Also, that Germany was a belligerent, major belligerent in World War 2, to put it mildly. And so, to ensure that Europe would remain peaceful. The idea was that having an American presence, having the allied presence would help with the reintegration of Germany into the European security economic architectures.

Kai Ryssdal 

So, the Soviet Union goes away at the end of the Cold War 89, 90, 91. And yet, NATO endures. And, you know, sitting where we are now, in the North Atlantic and European security situations, we have it, it’s a good thing it did. But the question is, my question is, how and why did it stick around for those 20ish years?

Kathleen McInnis 

Well, that’s a great question. And frankly, it’s been one that’s been on top of mind for a lot of policy analysts and scholars. But you know, if you don’t have the Soviet threat, what is the purpose of this organization? Well, it’s after the end of the Cold War, you had this sort of moment of existential crisis, you could say, where NATO was trying to figure out what its purpose was. And then all of a sudden, the Balkans happened. And NATO realized, hang on a second. We need Europe to be at peace. And, you know, having the Balkan crisis there, like NATO can play a powerful role in resolving this crisis or bringing some stability. And so, NATO decided to, it was called going out of area or out of business going out of NATO’s territories, because again, over the course of NATO’s lifespan, up to that point, NATO had been preparing for a territorial conflict and invasion of Europe itself. Well, now, the idea was, hang on a second. NATO can be a force for good globally, and we could start in Europe’s backyard by helping promote stability in the Balkans. We’re going to get out of area are out of business. Fast forward a couple of years, and you get to Afghanistan. You know, NATO was. Article Five is the bit of the NATO Treaty that people like to talk about the most, which is the bit of the treaty that says, you know, an attack on one is an attack on all. Well, September 11, 2001, happens. And NATO invokes Article Five and says, you know what, that terrorist attack against the United States was a terror attack on all of us, and we need to come together and respond. That, you know, fast forward a few more years and NATO is heavily involved in Afghanistan. So, it has done so many things in terms of operations, but also things counter piracy in the Mediterranean and other places. It’s continued to reinvent itself and discover new missions, because certainly the global security agenda isn’t shrinking. And NATO has been able to find a role.

Kimberly Adams 

Talk a little bit more about Article Five, because as you mentioned, the United States is kind of very famously the one member of NATO that has used this right under the treaty. And it’s also the one that seems to get the most criticism, particularly from former President Trump.

Kathleen McInnis 

Sure, so the idea is that, as I said earlier, is an attack on one ally is an attack on all, and where the debate really starts to get underway is like, is NATO, frankly, writing, you know, strategic checks that it can’t cash? Does it actually have the military capabilities needed to be able to determine if it can defend against Russian aggression to do the kinds of expeditionary operations that it says it wants to do? So, can the alliance really back up its words with real military capability? And so, when people have asked that question, they tend to look at what’s called the 2% target. So, what this is, in 2014, NATO allies said, you know what, actually, at the end of the Cold War, we stopped spending enough on defense, we’re doing other things, we was called the peace dividend. We don’t need to spend as much on the military because we’re not trying to repel a Soviet threat. So, we’re going to take that money, and we’re going to put it elsewhere. But in about 2014, people realize actually, it’s gone a bit too far. So, what we’re going to do is by 2024, we’re going to pledge to spend 2%, at least 2% of our gross domestic product on defense. And allies didn’t really meet it. 18 allies this year are projected to meet it, so it’s gotten better. But is there enough there to be able to backup alliance commitments? That’s the question.

Kai Ryssdal 

Well, so two things number one, do me a favor, would you and just debunk for anybody who doesn’t already know it the idea that there’s this fund that former President Trump keeps talking about that NATO allies are not paying into right? There’s no bank account labeled NATO that everybody pays into, right?

Kathleen McInnis 

Actually, as a nerdery kind of point there is a small account, but that’s not what they’re talking about. It’s basically it’s like, like a small fund to cover the cost of headquarters. What we’re talking about with 2% is actually like, what NATO nations are spending on their own military, there’s no like cash that they’re sending to the US to, you know, bank roll their you know, the US presence there that that doesn’t happen. It doesn’t make sense.

Kai Ryssdal 

Right. So, look, if you’ve given what former President Trump has been saying about Article Five, which is, in essence, he’s not interested, and the Russians can do whatever the hell they want. That’s a quote. If you’re an American ally, right now, do you have any faith in American constancy in this?

Kathleen McInnis 

That is the like, billion-dollar question right now. I think it’s in talking to friends over in Europe, it’s hard for them to maintain the faith. I mean, not just because of what former President Trump has been saying about, you know, letting Russia as you said, do whatever the hell it wants. That is, by the way, an absolutely terrifying world to live in Russia doing whatever the hell it wants me, when you see what Russia has done in terms of the war crimes in Ukraine, and thinking about that expanding elsewhere, terrifying stuff. Putting that aside. The real question, and I think, more of more deep concern is, what if Trump and his point of view is not an aberration anymore, right? What if our, you know, American political leaders have, you know, become so frustrated with what’s called burden sharing, again, whether or not nations are meeting that 2% target that they’re just sort of willing to say, you know, okay, we’re done with it, you know, your past to be able to handle some responsibilities. And that, by the way, it’s an understandable point of view, just particularly the US has been complaining about burden sharing and whether or not the allergies are spending enough for decades. So, it’s not a new issue, but to focus on that. Especially when it’s not like again, allies aren’t paying us for anything is profoundly strategically short sighted.

Kimberly Adams 

I was going to say, the allies are paying us via our defense contractors, and that this alliance also includes a lot of perks for our own defense industry.

Kathleen McInnis 

Absolutely. It also paves the way for greater transatlantic trade. We are entering an, or maybe we have entered an era of pretty profound geopolitical instability. And what NATO helps do is, is create a foundation for more security and stability for global trade relations. And when that gets disrupted, that becomes a problem for markets. Markets like stability.

Kai Ryssdal 

Keep going. Say more. Say more about that. Sorry, Kimberly. Say more about that, right? Because that’s the nub of it. From where I sit as the host of a program on business and economics, right? Make the case that economically, these alliances matter?

Kathleen McInnis 

Sure, I mean, just look at things like the Black Sea Grain Initiative, the war in Ukraine, because of just the impact of the on the prices of grain sent economic shockwaves around the world, raise prices of living cost of living around the world. It wasn’t necessarily immediately thought of outcome of the when you when you throw a stone in water, you’re not sure where the ripples are going to go. But the instability has these larger ripple effects across the global economy. So, when you think about things like the cost of grain, when we think about that kind of thing. It’s easy to envision how that could impact the American consumer and increase cost of living prices here in the United States. And that’s where, you know, NATO alliance membership or lack thereof, is going to impact American pocketbooks.

Kimberly Adams 

So, given what Trump has said, in this sort of concern among NATO allies, what are they doing over in Europe to sort of get ready for a potential second Trump administration?

Kathleen McInnis 

They are, you know, they’re investing in defense. And they’re thinking about, you know, what it will be like to work with an America that might be absent from the global stage. It’s, but it’s frankly, it is still, I would argue, hard for our allies and partners, and even Americans to sort of wrap our brains around if Trump actually follows through on the things that he says that he would do. And the policy positions he says he would have. We will be entering such a profoundly strategically different world, that it’s just hard to wrap our brains around like that, that kind of universe, it’s going to be more costly. And, you know, also, frankly, you know, when we think about problems like China, we need allies and partners to be able to work with us to counter China. We will have allies and partners the way we have had in the past if those kinds of policies become enacted.

Kimberly Adams 

But it’s not just Trump, though, because I mean, just look at what’s happening with Ukraine funding. Granted, it’s a lot of Republicans in Congress taking directions from Trump. But for all intents and purposes, we do have a lot of people sitting in Congress right now who are of the same mind. So even if Trump does not win election, some of this problem still exists.

Kathleen McInnis 

I think that’s exactly right. And I think it’s, it’s going to be a fact of life for our allies and partners to have to grapple with this kind of skepticism about American alliances and their utility. It’s, you know, going back to this question of 2%, and whether or not allies are paying their fair share, it’s one of the reasons that the argument around Congress has been happening is because of that concern that allies aren’t paying their fair share. But actually, you know, some CSIS colleagues, and I’ve been doing some backtracking, if you actually open the aperture on what we mean, when we talk about spending on national security, not just defense widgets and those sorts of programs, the broader national security picture, you’re actually talking about most, you know, I think it was 14 or 13 allies plus Sweden, who’s not not yet a member, spending 4% or more of their GDP on what we would call national security and a further 11 is spending 3% or more of their GDP on national security. So, the picture is much more balanced when you when you look at the broader scope of what contributes to allied security.

Kimberly Adams 

So much more to say and learn here but thank you. You’ve made us very smart on this. Kathleen McInnis, a senior fellow at the Center for Strategic and International Studies. Thank you very much.

Kai Ryssdal

Kathleen, thanks a lot.

Katheen McInnis

Thank you.

Kai Ryssdal 

Yeah, I don’t think people really understand. Let me rephrase that. People in this country don’t understand what they get out of these alliances. And look, that can be messy sometimes. But that’s why you get to travel freely. That’s why you get cheap stuff at Costco. That’s why you get French wines. And that’s why you get all this stuff. I mean, that’s why it all works.

Kimberly Adams 

It’s always fascinating to me what arguments land in this regard. You know, because the idea of wanting to protect our styles of governance, democracy over authoritarian regimes, you know, human rights versus what we’re seeing Russia doing. That doesn’t resonate in the same way often that these economic incentives do. Which reminds me of the early COVID conversations, were like, please put on a mask, people are going to die, please put on a mask, people are going to die. And then we were like, please put on a mask or our economy will be destroyed. That worked a little bit more. But anyway, yeah. What were you going to say?

Kai Ryssdal 

No, that’s all. I got nothing else.

Kimberly Adams 

Okay. Well, let us know what you think about this conversation that we just had about NATO about what you think of what Trump had to say. And, you know, if you have any deep thoughts on our alliances, more broadly, we’d love to hear about it. Our number is 508-827-6278, you can also call us at 508-U-B-SMART. Again, the same number, but you get the idea. We’ll be right back.

Kai Ryssdal 

Alright, we’re back news is next on my rundown. Kimberly Adams, what do you got?

Kimberly Adams

I want to go second. You go first.

Kai Ryssdal

Alright, so mine actually fits right into what we’re talking about with Kathleen McGinnis. Sort of in a way, it’s the defense industrial complex specifically in this country, but you know, generally globally. Piece in the Wall Street Journal today about SpaceX, and “how that company is deepening its ties with the US intelligence and military agencies.” That is the first line of the sentence. Winning classified contracts and expanding a new tippy top secret company satellite program with national security customers. So, it’s really interesting. And I have two thoughts. One is this is kind of what happens with commercialization of space. This is the end result of the government saying you know what, it’s better to have private companies rather than a large government investment in a space program do this sort of stuff. So, we have, you know, on a much smaller scale, Blue Origin and Virgin and then the behemoth, of course, is SpaceX and we’ve talked about SpaceX a lot. So that’s. It’s a natural extension. The challenge was SpaceX and with truly all possible respect to Gwynne Shotwell, who is the president of SpaceX and she’s the one who actually sort of runs it day-to-day. It is it is under the control of a person who is not necessarily fully in control of his faculties. Elon Musk is a challenged, challenged man in many, many ways. And he has this incredible amount of influence on our national security establishment. We’ve talked about that before was Starlink in Crimea and Ukraine, and now also in Israel and Gaza. It’s really troubling that he’s got this much sway in the national security establishment. I don’t know what else to say, and it all flows it. You’ll look at it, you’re like, of course, that’s the way it was going to go. But it’s just in the hands of a guy who is, I don’t even know what to say.

Kimberly Adams 

I don’t know what to say there either. I got nothing else on that. I mean.

Kai Ryssdal 

I don’t. don’t. It’s not always. It’s not always clear that he’s a good actor, you know?

Kimberly Adams 

I mean, I think it’s often clear that he’s not a good actor.

Kai Ryssdal 

More power to you for saying.

Kimberly Adams 

Just, yeah. If you look at what happened with Twitter, and also what he says, that’s pretty, that’s pretty clear. Right. So, my news is actually tied to our show last Tuesday and also I think we’ve got something coming up in the mailbag on this about money and love. Let me say money and relationships. The testimony in Fulton County, Georgia with Fani Willis, who has been in, the district attorney who has been investigating the election interference there. The testimony that has been going on there about her relationship with one of the prosecutors that she hired has been so just unbelievably cringy to watch. And it’s very clear that the lawyers for you know, the people she’s prosecuting, are trying to discredit her trying to get her off the case. They’re alleging improper behavior, and that she was trying to profit off of this all sorts of other things that have been very widely reported. One of the things that has come up multiple times in these hearings, is whether or not the fact that she relied so much on paying in cash was a sign of inappropriate behavior, that this was a sign that they were trying to do things sort of, in secret, or under the table. And I want to point out two pieces, one in CNN and one in the Washington Post that really get into this. So, the CNN story talks about how she was at a winery, and the person who was serving her at the winery remembers her paying for this winery tasting in cash, and it was close to $400. And the person remembered this because it’s unusual for people to pay in cash as opposed to a credit card. The Washington Post article talks about her dad and his testimony, and how he instilled in her the value of always having cash. I bring up both of these stories because I hadn’t quite realized that this was a very different conversation in the Black community about women and cash. And it has always been instilled in me, and I know it’s not just within the Black community. but it seems to be more pervasive based on what I’m reading here and the way that it’s being talked about in this case. That we are raised to be even more fastidious about having your own money, especially in the context of a relationship and for having cash. And this is the legacy I think of African Americans being unbanked or being treated some kind of way by the financial system. And let me bring up this quote. This is from Fani Willis’ father who said, that he was this is from the Washington Post article, he said “that he was the one who advised Willis to always carry cash and to keep six months of worthy of cash always. ‘Excuse me, Your Honor. I’m not trying to be racist, okay, but it’s a Black thing,’ Floyd said. He told a story about attempting to pay for his family’s meal at a Cambridge, Massachusetts restaurant. Floyd was at Harvard on a fellowship and Willis was three years old at the time he recalled. ‘The man would not take my American Express card, so I pulled out my Visa card, and he wouldn’t take my Visa card.’ The same with his traveler’s checks, but the $10 bill Floyd had, that was accepted. ‘I’ll never forget that as long as I live’, Floyd said. Not only did Floyd keep three safes in his own home, he gifted his daughter her first cash box. When she testified, Willis said cash meant financial independence and security, values her father had taught her. The question of money and how it was used is significant in the misconduct allegations against Willis.” And it goes on to say that because this is being used to highlight, you know, whether or not this was improper. I know that was a lot. But this concept of who uses cash and how, I never imagined it would have this much weight, and it really has gotten me thinking about the different roles of cash in different communities. And I don’t know, what do you think, Kai?

Kai Ryssdal 

Obviously, I can’t speak to the Black experience in this economy, but it makes total sense. Yeah, I’ll get to that part in a minute. But you know, I just did a totally fascinating interview with a woman who written a book about the Freedman’s Bank back after the Civil War. And she traced, I asked the questions, how that has led to Black Americans mistrust of the banking system to this day, so I completely get it. It was illuminating to me, the degree to which people watching this coverage. And look, Fani Willis on the stand. The only way to say it was she was a badass, she was not having any of it, right? A man is not a plan. A man is a companion. I mean, all of that stuff, right? You’re confused. You’re trying to put me on trial. They’re the ones on trial, right? I mean, she was, it was amazing to watch. It was cringy, as you said, to see and hear some of the testimony about that relationship and all of that. And look, let’s, let’s pause it here that it was bad judgment, at best for them to have engaged in this relationship while they’re in this high-profile case. But on the use of cash specifically, it was amazing to me how many people watching this took that as a marker of guilt. Why would you be doing this? If you weren’t guilty? Why are you using a cash economy if you didn’t want it to be traced? And if you don’t want to be traced? Well, then you got to be guilty. There’s got to be something wrong here. And clearly, there’s a cultural divide here, between the, I believe it’s mostly white attorneys who are questioning both Wade and Fani Willis. And the fact that both of them are Black. Right? I think that that really plays into it here. And it was, it was just it was it was not it was it was remarkable to watch the way people got bent out of shape about that without understanding history and Black Americans being unbanked.

Kimberly Adams 

Yeah. I was, I mean, this is again, I love getting the physical copy of The Washington Post, which is how I stumbled upon this story about Fani Willis’ father this morning. I didn’t even realize it was a cultural thing within the Black community until this. There’s a very beautiful piece of work of art by the African American artist, Glenn Ligon, and it’s a big door. And at the top, it says in stencil it this line from a Zora Neale Hurston novel or essay, it says, “I feel most colored when thrown against a stark white background.” And as the image progresses down this door, it gets blurrier and blurrier until the bottom, it’s all black. This idea that you don’t even notice your Blackness until you’re brought up in contrast with something that makes you feel othered. And I had a bit of that moment this morning. I was like, oh, that’s just us. I didn’t know. And I mean, I imagine it’s probably similar for immigrant communities as well, but I just thought it was super fascinating.

Kai Ryssdal

Totally interesting.

Kimberly Adams

All right. That is it for news. Let’s do the mailbag.

Mailbag

Hi Kai and Kimberly. This is Godfrey from San Francisco, Jessie from Charleston, South Carolina. And I have a follow up question. It has me thinking and feeling a lot of things.

Kai Ryssdal 

All right, related, but different. We talked about money and love last week on the program and how couples navigate sharing their finances. Here’s something we got:

Beth

This is Beth calling from New York City. When I was dating, I would always pretty much pay my half of the check, so that the men that I was dating didn’t think I owed them anything. When I did get married, my grandmother urged me to always have some of my own money. When she was my age, she wouldn’t have been able to have a bank account of her own. And when she and her husband divorced, it was terrible financially for her. She’s always instilled in me that you know, women need to look out for themselves because the world isn’t always necessarily going to.

Kimberly Adams 

Assuming it’s a gender thing as well. Okay, one more. I recently talked about a lovely article about a man who rescues cats from trees for free and a listener sent us this.

Kazu

Hey, Kai and Kimberly. It’s Kazu from San Francisco. Wondering if Kimberly is familiar with the Animal Planet show called ‘Treetop Cat Rescue.’ It’s a show that follows around two tree trimmers who have a side hustle rescuing cats stuck in trees. Kai was wondering why cats got stuck in trees. These guys also pointed out that if you know what a cat claw looks like, they’re slightly curved. So, a cat has no problem getting up the tree. But when they try to come down the tree, the claws are the wrong shape, and they’ll fall out of a tree unless they come back down the tree backwards, which cats don’t do.

Kai Ryssdal 

Never thought of that.

Kimberly Adams 

I did not know about this show. I will have to check it out. Thank you.

Kai Ryssdal 

All right. Before we go as we always do we leave you with this week’s answer to the Make Me smart question. What is something you thought you knew, but later found out you were wrong about? This week’s answer comes to us from Nicole Stott, a former NASA astronaut and founder of a children’s art nonprofit. It’s called the Space for Art Foundation.

Nicole Stott

Having worked for NASA for years, I knew that all of the work we’re doing in space is off the Earth for the Earth. But it wasn’t until I was an astronaut on my first mission to space that I discovered that I was wrong about those benefits being all about the science and technical stuff. Floating together with my international crew with that very special view of Earth out our space station windows. It was a stunning reality check of who and where we all are together in space. Our mission there wasn’t just about the science and technical stuff. It was about the simple stuff. Like the simple fact that we live on a planet, that we’re all earthlings, the significance of that simple stuff very quickly became crystal clear.

Kai Ryssdal 

Yep, it is the simple stuff, that’s for sure. Totally. We obviously want to hear your answer to the Make Me Smart question. Our number is 508-827-6278. 508-U-B-SMART, dial them and see what happens. I actually don’t know what happens when you dial that phone number. I should try it.

Kimberly Adams 

Make Me Smart is produced by Courtney Bergsieker. Ellen Rolfes writes our newsletter. Today’s program was engineered by Charlton Thorp with mixing by Gary O’Keefe. And our intern is Thalia Menchaca.

Kai Ryssdal 

Daniel Ramirez and Ben Tolliday composed our theme music. Our senior producer is Marisa Cabrera. Bridget Bodnar is the director of podcasts. Francesco Levy is the executive director of digital and on demand. And Marketplace’s Vice President and General Manager is Neal Scarbrough.