Principal Deputy Assistant Secretary Murphy Speaks on NATO at the Clingendael Institute

A/PDAS Murphy at the Clingendael Institute with Senior Research Fellow Dick Zandee.

Acting Principal Deputy Assistant Secretary for the Bureau of Europe and Eurasian Affairs Michael J. Murphy delivered a speech on NATO at the Clingendael Institute in The Hague April 8, 2019.  The audience, of more than 80 guests included former Dutch Ministers of Defense, politicians, and students.  A question and answer session  followed the speech.  The full text of his speech is below.

Defense Investment in Today’s Strategic Environment

This year, 2019, marks the 70th anniversary of NATO’s founding. It is cause both for celebration and for reflection about NATO’s future. In 1949 as Europe was rebuilding from the ruins, Western countries joined together to co-found NATO. The outcomes were not certain, and America could have instead packed up and gone home. But after the devastation of two world wars, and facing the prospect of further Soviet aggression, our predecessors on both sides of the Atlantic saw the perils and risks to each of our nations and understood that only in alliance could we guarantee our security. This was a brave and visionary choice for the political leaders of the period, requiring investment at a time when each country faced significant competing political and economic priorities. This momentous decision laid the foundation for 70 years of unparalleled peace, prosperity and human flourishing within the transatlantic community.

NATO has been called the most successful Alliance in history. The moniker is deserved. Article 5 defines NATO’s bedrock commitment, and it has remained the constant for 70 years. But, as threats changed, NATO’s definition of its core tasks has also changed. 1949, 1989, 2001 – each of these dates presented the Alliance with a new strategic environment. Each time, our governments answered the call by reshaping our defenses and developing new capabilities to resist new and emerging threats.

For NATO’s first 40 years, the strategic environment required us to maintain large conventional armies designed to deter, and if necessary, to defeat the Soviet Union. During the height of the Cold War, the United States Army had some 400,000 personnel in Europe; Canada had a permanent military presence in Germany; the Bundeswehr’s strength was some 495,000 military and 190,000 civilian personnel; Norway could mobilize at least 10 heavy brigades; and The Netherlands had over 700 tanks. Every morning those soldiers and our leaders woke up thinking about the Fulda Gap, the most obvious route for a Soviet tank strike on West Germany.

After 1989, with the fall of the Berlin Wall and the collapse of the Soviet Union, the scope and size of these forces seemed unnecessary and expensive. At that point, nations could have called NATO a success and closed up shop. But again, our visionary predecessors recognized that we still needed NATO, and that the Alliance could provide the foundation for transatlantic efforts to build a Europe that was strong and free. So, we entered into a new era of engagement and cooperative security. For the first time, NATO built partnerships with our old Cold War adversaries. We welcomed new Allies who had lived under Soviet oppression for decades. We also addressed ethnic conflict in the Balkans. During the 1990s, our threat assessments changed, and therefore so did our force posture and capabilities. We talked about a “peace dividend,” reduced defense spending, and maintained smaller forces.

That historical moment ended the morning of September 11, 2001. For the first time in Alliance history, we invoked Article 5, as we came face-to-face with the new realities of the new century. We realized that we were confronted not only with traditional military and political threats, but also with threats from non-state actors who could strike cheaply and anonymously from another continent. In that moment, we understood that we needed to be able to operate outside of our immediate territories to address emerging threats. This new set of strategic concerns and new missions required new capabilities. In addition to the conflict stabilization and crisis management missions we developed in the 1990s, we needed forces capable of tackling counterterrorism, irregular warfare, and counterinsurgency operations. The move away from large standing armies, the changes we implemented as the Cold War ended, they accelerated.

As the focus shifted to the challenges emanating from places like Afghanistan, Iraq, Libya, and the Sahel, some saw Europe as a post-geopolitical, post-historical place. The experts assured us that we had reached the end of history and seen the breaking of nations in Europe. The world was flat, and we could focus on commerce and harnessing the information technology revolution to benefit humankind. These views, in turn, justified an extended period of military cuts – cuts to personnel, to platforms, and to investments in new defense systems.

But as always, the world continued to turn. History rolled on, and the pendulum swung back.

Today, we find ourselves in another era – the return of great power competition. Europe is once again a theater of strategic competition. Once again, Russia is engaged in wide-ranging efforts to tear apart what we have built over the last 70 years. It seeks to undermine NATO, the European Union, and the OSCE; it seeks to discredit and destabilize our democracies; it seeks to reestablish spheres of influence and control over neighboring states; and it does this with a wide range of tools – some new and some old.

One of Russia’s evolving tactics is the use of malicious cyber-operations. You will recall its first high profile attack, in 2007, against Estonia, ostensibly in response to Estonia’s relocating a statue of a Russian soldier. But Russia was just getting started: in 2008, Russia deployed offensive cyber operations in Georgia; in 2015 and 2016, Russia attacked Ukraine’s energy grid; in 2017, Russia’s reckless NotPetya cyber-attack spread globally, causing billions of dollars of damage; and in 2018, Russia planned a cyber-attack against the Organization for the Prohibition of Chemical Weapons, which Dutch and UK security services thwarted. I can say with confidence that this is not the end of Russia’s efforts in cyber warfare.

Russia has revived Soviet-era disinformation and malign influence strategies in an effort to divide the West, mislead our publics, and undermine our democracies. Russia’s attempts to covertly influence the 2016 U.S. election are well known, but hardly singular. The Kremlin has sought to influence dozens of electoral contests by spreading disinformation on social media and seeking to illegally funnel money to political parties. In the Western Balkans, Russia seeks to magnify ethnic tensions. Russia and its proxies have engaged in dangerous behavior attempting to prevent Montenegro from joining NATO, and more recently, the Kremlin and its networks of malign actors attempted to derail the Prespa Agreement that resolved tensions between Macedonia and Greece.

Similarly, Moscow has a long history of weaponizing its energy supplies. In 1990, the then-Soviet Union disrupted oil supplies to the Baltic States in a vain effort to crush the region’s nascent independence movements. Russia regularly targeted Ukraine, Georgia, and Lithuania during the 1990s and 2000s. Notwithstanding its contractual obligations, Russia has cut off gas supplies to Ukraine, and through Ukraine to Europe, four times since New Year’s Eve 2005. Sudden price increases on natural gas… supply manipulations… sudden debt calls: Russia manipulates its position in the European energy sector to exploit vulnerabilities, to influence domestic politics in importing countries, and to intimidate its neighbors.

In 2008, Russia provoked a war with Georgia and sought to carve out the regions of Abkhazia and South Ossetia to establish de facto dominion over Georgia, to prevent Georgia from enjoying a future in the West, and to quash its democratic aspirations. Today, twenty percent of Georgian territory remains occupied by Russia, and Russia continues efforts to undermine Georgia’s progress on its reforms.

Ukraine is the clearest example of Russia’s blatant disregard for international law and its threat to our shared vision of a Europe strong and free. Russia’s seizure of three Ukrainian ships and 24 crew members in the Black Sea near the Kerch Straight last November was a shocking and unambiguous violation of Ukrainian sovereignty. But it is part of a larger pattern of Russian behavior that includes the purported annexation of Crimea, abuses against Ukrainian citizens in Crimea, and sponsoring a conflict that has taken the lives of more than 13,000 people in Ukraine.

And as all NATO Allies have recognized, Russia has also violated the Intermediate Nuclear Forces (INF) Treaty by deploying new ground-launched missiles with ranges prohibited by that treaty, missiles that represent a direct threat to Europe.

But Russia is not the only great power competitor we face. An increasingly assertive China is challenging Western influence and values. It is also building a strategic foothold in Europe by employing so-called “gray zone” tactics – private and public sector investments in sensitive technologies, infrastructure, and natural resources – that threaten our security. It is critical that Allies maintain secure, reliable information and transportation networks. We are concerned about Chinese influence over such infrastructure and are encouraging all of our Allies to include national security, including cyber security, as key considerations in the evaluation of infrastructure-related projects. The risks must be weighed before making procurement decisions on 5G, for example.
China also impacts NATO’s security along our southern periphery with its expanding presence, including an enduring military and naval presence in Africa.

At the same time, we cannot ignore the challenges posed by nations like Iran and North Korea. And as we said at the Brussels Summit last year: terrorism, in all its forms and manifestations, poses a direct threat to our populations. This threat includes terrorist groups intent on infiltrating our homelands to conduct mass casualty attacks, and intent on inspiring homegrown terrorists to do the same.

That’s a long and sobering list of challenges. So, what should we do?

Today, our task is to rally and preserve the West as a realm of ordered liberty against this array of new and emerging threats. While it is fitting that we look back this year and celebrate all we have accomplished since 1949, we must also demonstrate the same courage that NATO’s founders did when they made the difficult decisions to defend the transatlantic space in 1949. To quote Winston Churchill: “Success is not final. Failure is not fatal: it is the courage to continue that counts.” The challenges we face in 2019 are just as complex and urgent as those we faced in 1949, or in 1989, and again after September 11. The moment has come once again to modernize the Alliance and adapt to new realities.

Russia, China, terrorism, Iran … we cannot pick and choose which threats we are prepared to meet. NATO must be prepared to meet them all. It is a big job, and no single country can do this alone. One of America’s great founding fathers said, “We must all hang together or, most assuredly, we shall all hang separately.” This understanding is what prompted North America and Europe to join together 70 years ago to create a new Western order firmly grounded in transatlantic cooperation. Given our record of success over the past 70 years, there is no reason to believe that we cannot do so again. But we cannot be complacent. We cannot simply assume that our successful past is a prologue to a successful future. And, as the challenges to NATO accelerate (as Russia’s has), we must accelerate our efforts to meet them, and we must prioritize investment in our security now, if we wish to enjoy it for generations to come.

The reemergence of Russia as a long-term strategic competitor must be our top priority. The Kremlin has unambiguously stated that it sees the transatlantic community as a threat, and no amount of wishful thinking on our part can avoid recognizing the intent behind their actions.

The challenges from Russia that I described earlier have occurred against the backdrop of one of the most significant military modernizations in Russia’s history. While NATO militaries retooled to focus on stability operations and replaced their heavy forces with lighter ones that can be more easily deployed out-of-area, Russia retained a heavy combined-arms force that emphasizes mobility and firepower. Over the last decade, Russia has fielded modernized weapons, improved its armed forces readiness, gained valuable combat experience in places like Georgia, Ukraine and Syria, and modernized its nuclear arsenal. And as we know from its ZAPAD military exercises, Russia is training and exercising its forces to conduct even larger-scale combined-arms operations, demonstrating its capacity to mass ready forces quickly in western Russia, along NATO’s eastern flank.

We must be prepared to address challenges from Russia across the entire transatlantic theater. We must defend the Suwalki Gap, a strip of land only 100 kilometers wide that links our Baltic Allies to Poland and the rest of Europe, and which has been made even more vulnerable by Russia’s anti-access/area denial, or A2/AD, bastion in Kaliningrad. At the same time, we must cope with the growing Russian military presence and aggression in the Black Sea. In the High North, Russia is reopening old Cold War facilities, rebuilding its military infrastructure, and deploying additional, modern forces. In the North Atlantic, Russia is increasing its submarine patrols and operating at a frequency not seen since the Cold War.

We need heavier, high-end forces to meet the challenges Russia now poses. In other words, we must retool our militaries – just as we retooled them when the threat in the 1990s demanded a shift from heavy to lighter forces. We must scale up our forces and improve their readiness and mobility. We need more systems like next-generation fighters; heavier infantry and armor brigades; improved intelligence, surveillance and reconnaissance assets; and a greater focus on integrated air and missile defense. This is not going to be easy, it is not going to be cheap, and it is not going to be fast – but we need to move faster because we are already playing catch up.

Allies must also invest in new technologies and more innovative approaches to defend against cyber-attacks. And we need to be able – and willing – to shed light on hybrid tactics and expose their true nature, intent, and particularly their source, like the Dutch did following the attempted OPCW attack. We cannot allow disinformation and malign influence, two of the main tools of hybrid warfare, to drive us apart, or divert us from meeting the challenges we face.

All of this – heavier and ready forces, greater cyber capabilities, a focus on hybrid threats – is necessary to ensure that we sustain a credible deterrence and defense posture that is suited to the current and foreseeable strategic environment.

And we must do all this while also enhancing and deepening our partnerships with countries in the Middle East and North Africa, strengthening NATO’s deterrence and defense against challenges emanating from the South, contributing to international crisis management efforts in the region, and helping our regional partners build resilience against security threats, including against terrorism.

If each Ally does its part, the Alliance will have the capabilities it needs to protect our citizens and to protect the West. It is that simple. The decision is ours to make.

We must invest more on defense if we are to sustain a credible deterrence posture. We must make national priorities of the investments that are necessary to retool our militaries. The United States is doing just that. In 2019, the United States will spend $16 billion more on defense than we did in 2018, spending a total of 3.5% of our GDP on defense. Investment in Europe and NATO are at the core of our defense budget. In addition, we have invested over $10 billion over the last five years through the European Deterrence Initiative to enhance U.S. force posture in Europe, increase our training and exercises in Europe, upgrade U.S. and Allied facilities, and pre-position military stocks in Europe.

The Alliance, as our soldiers say, is a “force multiplier”. We can do things together that none of us, not even the strongest Allies, can do alone. We need each other, and we need to count on each other. Together we can do amazing things. We have secured one of the longest periods of peace and stability the world has ever seen. Our values, our societies, our laws, our freedoms, our economies… our very citizens’ lives have benefited enormously by the cooperation forged in NATO. We have reached an inflection point in history, and we need more vision, more resources, and more attention to the threats around us if we are to take advantage of the opportunities in front of us. When we invest more on defense, we are investing in ourselves, in each other, and in our future.

Which brings me to the magic numbers of Two and Twenty: Two percent of GDP spent on defense, and Twenty percent of those defense expenditures spent on major new equipment. This is not a new concept – Allied leaders began using these numbers as benchmarks as early as 2006. In September 2014, just months after Russia’s invasion of Ukraine, these numbers were formally approved as a commitment Allies made to each other. This was the Defense Investment Pledge, approved at the 2014 NATO Summit in Wales.

When we made the Wales Pledge, we were only beginning to grasp the extent and implications of Russia’s military modernization and challenges to our security. Everything we have seen in the threat environment since our meeting in Wales confirms that our pledge to spend more on our defense was timely and necessary. The threats to the Alliance and our interests have only grown since then. The Wales Pledge was an acknowledgement that we needed to do more to keep our people safe, and it was a political commitment that we made to one another, a way of holding ourselves accountable to our treaty obligations. Two and Twenty are benchmarks that help us explain to our citizens that we need to make hard choices if the Alliance is to fulfill its three core tasks: collective defense, crisis management, and cooperative security. But, at their heart, what those investments are buying are the readiness levels, end strengths, and capabilities that we need to meet the challenges of today’s security environment.

This is not merely a question for consideration within ministries of defense or foreign affairs – this must truly be a national commitment by parliaments and people – everyone in our countries must understand the importance of defending ourselves and our way of life. We must do the important work of explaining to our fellow citizens how these investments will contribute to their security, prosperity, and ability to live in freedom.

Before I wrap up my remarks, I want to say a word about the EU defense initiatives launched over the last year or two – things like the Permanent Structured Cooperation on defense – or PESCO – and the European Defense Fund (EDF).

The United States has been clear that we support EU efforts to increase defense capabilities – that is an important part of the burden sharing piece that I have been talking about. But there’s a real risk that if not done right, these initiatives will undermine transatlantic cooperation by duplicating NATO efforts and diverting valuable resources away from filling critical capability gaps identified by the Alliance.

In particular, we are worried about restrictive language on third-state participation in the draft guidelines for EDF and PESCO. As currently drafted, these guidelines appear designed to effectively prohibit participation in PECSO and EDF projects by longstanding transatlantic partners such as the United States, Norway, and Canada.

Let me provide an example of what I mean. The draft EDF regulation contains language on Intellectual Property Rights and export control. This, in and of itself, is not objectionable. However as currently crafted, the language is so restrictive that it will effectively discourage any non-EU entity, including subsidiaries of non-EU entities that are located in the EU and employ EU citizens, from participating in EDF-funded defense projects. Since PESCO projects could (and likely will) receive EDF funding, the same language will also discourage U.S. and other non-EU entities from participating in PESCO projects either in areas where technologies and know-how are nationally controlled or where the release of Intellectual Property Rights creates significant disadvantages to the entity.

Not only will this language penalize key non-EU Allies, it will impede the development of very high-technology capabilities the EU is seeking through its EDF and PESCO initiatives because it will cut these projects off from high-technology options available from within the transatlantic defense community. This includes components, such as GPS chips and security elements, that EU countries have recognized come from non-EU sources and will be required in EU-defense capabilities. And, we can take this a step further. By effectively boxing out options available from non-EU Allies, the EU will be required to devote scarce defense resources to the duplication – the unnecessary duplication – of already available technology and equipment. And that is not all. The impact of this is not confined to a single EDF or PESCO project. It is cumulative.

Over time, this forced division and duplication will negatively affect transatlantic interoperability and technological collaboration. That is not good for Europe. It is not good for NATO. And it is definitely not good for transatlantic security. From the beginning, Europeans sought to reassure Americans that this was not the goal of the EU defense initiatives. We were anxious but largely accepted these assurances since both sides of the Atlantic had made a concerted effort to move beyond the theological debates of the 1990s and early part of this century when it came to NATO-EU cooperation and EU defense initiatives. Now, as the EU moves beyond political pronouncements and concepts into implementation of PECSO and EDF, we are seeing something different, something altogether more concerning. This is why we cannot support the direction of either PESCO or the EDF as currently drafted.

You heard me talk about the serious challenges we all face in today’s security environment. Now is not the time to de-couple North American and European security. That would only help our adversaries. We must continue to build on our decades of progress increasing integration in transatlantic defense.

I think it’s fitting to end my remarks with a few comments about last week’s NATO Foreign Ministerial. The United States hosted NATO Foreign Ministers to celebrate the Alliance’s 70th anniversary. Ministers released a statement that celebrated all the Alliance accomplished over the last 70 years, portrayed a realistic picture of the security environment we face, and affirmed NATO’s commitment to implementing the decisions made at the 2018 Brussels Summit. At the end of this year, NATO heads of state and government will meet to provide further strategic direction for the years ahead. We must capitalize on these meetings to strengthen our resolve and dedication to ensuring NATO has the capabilities to meet today’s security challenges.

History has given us a rare opportunity: it has allowed us a glimpse of the new threats before us … they are not surprises. We have seen these threats evolving over the past decade. We have the time and opportunity to address them, but that window will not stay open forever. NATO is strong and has some incredibly powerful tools available to help us meet those threats. As a political force, NATO includes three permanent members of the UN Security Council – five total with Belgium and Germany both having seats on the Security Council right now; NATO has myriad partnerships across the globe; …I could go on and on touting all the advantages the Alliance provides us in addressing the challenges we face.

So we must not put all that we have achieved at risk because we cannot – or will not – make the case to our publics at home of the need to invest the resources required to secure the Alliance for the next generation. What will we tell our children if NATO fails at its task of defending our nations, if they ask us why we did nothing despite all the evidence before us? This moment is ours, we must choose. It is time to honor the solemn commitments we have made to one another for the past seventy years, to ensure our shared peace, stability, and prosperity for the future.

The audience at Clingendael asked questions after the speech.