serving in kosovo. we had thirdly an operation in the gulf of adden to support operation ocean shield which links to not only the european union but countries like china and indonesia and russia. in order to provide for security at sea, we had an air policing operation in the baltics as well as over iceland, and iceland in the future will see the participation of non-nato members, finland and sweden, and of course we had our operations in afghanistan and libya. let me spend two minutes on those operations and the lessons we learned for nato. afghanistan is a unique, truly unique operation. it involves 50 nations at the height, deployed 150,000 troops. a third of which came from european nato members. and in 2009, cartwright will remember those discussions, we found an afghanistan that was

frankly a mess. it was a place where our mission was failing. and we had a strategy that was unfocused and means that were insufficient and we had a probability of success that was waning. that was the situation as we found it in 2009. we adopted a new strategy. when i say we, not only we the united states but we the alliance and its many partners adopted a new strategy that matched and narrowed the mission. up to this point the mission was to make afghanistan the next jeffersonian democracy, to make sure women would have the same rights as men, not only there but the same rights as women have in the nordic countries. it was a large and frankly unattainable mission. what we did is we made the focus

of the mission real, which is to make sure that afghanistan would never again be a safe haven for terrorists. that is why we were there in the first place and ultimately had to be the reason why we were there in the last place. we also adapted our means to that mission. the means were to buy time for the afghan national security forces to be able to take care of security in its own country. we did that by surging troops, not only american but allied troops in large numbers, and set a very clear deadline, a deadline of the end of december 2014, at which point afghanistan's responsibility, the security for afghanistan's responsibility would lie in the hands of the afghan security forces. we can debate whether we are succeeding in that strategy and i'm happy to do so in the q and a.

i would argue that the situation today in terms of what is happening in afghanistan and the capacity of the afghan forces to provide security is a lot better than it would have been if we had continued a failed strategy in 2009. clearly afghanistan is not a nirvana. there are huge problems remaining, the third poorest country on earth. the people and livelihood of the people are better off and more secure that they would have been otherwise. libya was the sixth operation and new challenge, in many ways a real test for the nato 3.0, for the new strategic concept that started out saying that nato is a source of stability in an unpredictable world. when the leaders in lisbon in november 2010 signed off on that statement, not a single one of them realized three months later they would, in fact, be

engaged in the military operation over libya. it took three years for nato to decide to get involved in bosnia. it took one year for nato to get involved in kosovo. it took one week for nato to decide to get involved in libya. this was a unique mission. it was a mission that involved for the first time real and fundamental burden sharing, something that americans have been calling for from europeans for the last 50-some years, in fact, probably 65 years. the allies and partners provided the bulk of the forces and bulk of the capability. the united states contributed what it had uniquely, that enabled this operation to succeed. the united states provided about 75% of the intelligence surveillance and reconnaissance and provided the refueling that made the bombing campaign necessary. it provided predators to go after particular targets at

particular sensitive moments and provided the 100% of the capacity to suppress enemy air defenses. that was the u.s. contribution but the allies did the rest and all stepped up. 13 countries participated in the operation, 13 nato countries participated, and the vast bulk of those who didn't participate couldn't because they didn't have the capability. they didn't have the advanced air forces necessary for combat operations or navies to patrol the arms embargo. in contrast to the last air campaign that nato conducted in kosovo when the united states struck 90% of the targets and europeans struck 10% in libya, the united states struck 10% of the targets and europeans 90%. that is the kind of burden sharing from a u.s. perspective we would like to see. france and the united kingdom took the lead and provided 40 -- provided the bombing and

striking missions in about 40% of the cases. countries like denmark, norway and belgium contributed, too. those three countries alone with half of the number of aircraft struck as many targets as france did during the seven months of this campaign. italy provided a basis that were absolutely crucial to conduct the operation and participated in the bombing operation as well. other countries participated. this was, in my view, the kind of operation that nato was suited for, is suited for and demonstrated that it could be relevant to the world of today. that's the good news. the bad news is that in five years from now, it isn't clear that nato could in fact do this operation again. and this i say noting that the libya operation was relatively small compared to the kind of bombing operations we've conducted in the past. it was about one fifth the size

of the kosovo air campaign in terms of number of airplanes participating and in terms of -- if you look at the issue of syria where in august and early september we were contemplating the possible use of force, it was clear that had it come to strikes, these would have been overwhelmingly american strikes, not only because some countries didn't want to participate, but in order to conduct an air campaign against the country with as advanced an air defense system the syrians had, frankly, only the united states had real capability to deal with that kind of threat. so we are faced now, it seems to me, and here i come looking to where we are in the future, with a european capacity that is real but declining. that is not where it needs to be for the united states to have

the partner that it wants to have. the consequences of decisions that were made in the past are coming home to roost. first we are seeing that the operational expense has significantly affected the investment that europe has been able to make in the future. rather than increasing defense spending in order to allow the deployment of troops and airplanes and ships abroad in operations, european governments moved euros and other currencies from the investment account to the operational account. in order to make sure it could meet the needs that were there. in the short term that meant that operations were able to be conducted. in the long term it meant that investment has suffered. secondly, we have seen a continuing misallocation of defense resources. personnel cost of the european nato members are 50% of their defense budget.

as opposed to only a third for the united states. that is a significant difference. that translates into real capability problems down the road. investment is less than 20% of non-u.s. nato european countries, versus 30% for the united states. the united states today spends three times as much on equipment, seven times as much on r and d and four times as much for soldier on defense compared to its nato allies abroad. we've seen, thirdly, a decade of cuts in defense spending. in 2000, the non-u.s. nato spent 2% of gdp on defense. in 2007, before the financial crisis, the non-u.s. nato spent 1.5% of gdp. that is a quarter percent cut.

in 2012, non-u.s. nato spent one-third, 1.3% of its gdp on defense. that is a one-third cut in relative terms since 2000. you cannot really have a strong military when you are underinvesting in the future. today only three allies meet the 2% goal aside from the united states, the u.k does so by counting expenses in afghanistan, greece, which frankly uses most of its defense moneys for a job program, and estonia, which while we appreciate what estonia does is not going to be the backbone of this. poland comes close to 2%.

and clearly, it is something that needs to be recognized. but overall, our european allies are not spending enough on defense. the consequences are real. so our biggest allies are the ones where the problems are likely to be the worst down the line. in the united kingdom, we have seen a progress of cuts in military capability. by 2020, by some estimates, britain will have 19 surface combatants in his mighty royal navy. its nuclear modernization will account for 35% of its procurement budget over the next ten years, effectively meaning that we're having a 25% cut in capability over the next decade. in france, resourcing of its defense forces is not being cut as dramatically as in the uk but is being cut by having spending being held at real terms in zero percent growth which will result

in a cut in capabilities. we can see this in operations while france was able to deploy forces in mali, it could only be sustained by having a significant contribution, not only by the united states but also by many key allies to make sure that a relatively small operation like that could succeed. in germany, we see a defense budget stuck at 1.4% of gdp. now it's a rising gdp so that's good news, but the cost of restructuring its forces is affecting its ability to translate euros into real defense spending. last year for the first time since world war ii, asia spent more on defense than europe. this is a pivot of a kind that i'm not sure europeans want to see. today the united states accounts for 75% of the overall spending within nato. while the u.s. is cutting its defense spending, its

willingness to subsidize the allies is going to decline and indeed one of -- as was seen in the case in mali when the united states was willing to provide assistance but also would like to get paid for it. these trends in defense spending are unsustainable. it's not just me who is saying that. it's what secretary gates said when he left in june of 2011. it is what secretary panetta said in -- when he left in october of 2012. it was what hillary clinton said last year at the secretary clinton last year at the awards dinner of the atlantic council. it is not sustainable for an alliance to see this kind of trend to continue. so what, as lennon said, is to

be done? the answer you hear in europe is pooling and sharing. indeed, there is a lot that pooling and sharing can do. the c-17 consortium was a master of putting this together, is the kind of thing we would like to see. the dutch could only afford half the c-17. the swedes -- which isn't useful when you want to fly a plane, they bought the other half. together they have a plane. that's how pooling and sharing can work. we have an awax fleet that if funded can effectively provide airborne early warning and control, and we have a commitment to buy the air ground surveillance system, five major drones that will provide nato with the capacity to see what is happening on the ground. we are investing in europe on air refueling capabilities and that, too, is good. but there are two fundamental obstacles to turn these

anecdotal good steps into real capability down the line. first, our national defense industries are frankly too small, particularly in europe, for the national markets. so there's a need for fundamental reform and consolidation and frankly there is no willingness to do that reform and consolidation and give up for governments in europe and in the united states to give up control over their national defense industries. that makes collaboration more difficult. and secondly, there is the issue of sovereignty. when it comes to defense, sovereignty is the issue that ultimately comes home. and it may be okay for the dains to give up the submarine fleet saying they should rely on uk or dutch. it may be okay for the dutch to decide to get out of the

mechanic -- mechaniced army business but not okay for france or uk or germany to likewise truly pool and share. the real problem that i see in the proposal tabled just a few weeks ago by the german government is that pooling and sharing based on key strong allies is that those allies may not be willing to pool and share their capabilities. so, if we have a national industry in the way we have, if we have sovereignty views in the way we have, i see a bleak future unless something changes. a future that frankly hurts the united states. it is not in america's interest to have a weak europe. it is fundamentally in america's interest to have the strongest and most capable allies in europe that we can. we do need to find a way ultimately for this alliance to prosper by having more resources devoted to defense. that means as economies rebound, there's a need to increase

spending on defense. that means that as economies rebound more of the spending needs to go into investment. that means that there needs to be, to the extent we can find a way, to increase more increases in defense cooperation, including importantly on the issue of role specialization, and that may mean also a reordering of our priorities. here let me end with perhaps a harasy, and anyone who knows me, it's one i've long believed in. our spending or nuclear weapons probably isn't the smartest spending we can think about when it comes to the future of this alliance. these are weapons that are not likely to have any role in anything we do in 99.99999% of the time and perhaps even 100% of the time. but they take resources away from capabilities and forces that are necessary for 99.99999, if not 100% of the time.

that kind of cost calculus is necessary here. it may well be necessary in europe as well. with that, thank you very much for listening. i'm happy to take your questions. [ applause ] >> thank you very much, that was just fantastic. it's quite an important address we heard from the ambassador. the real question is will nato be there when we need it, when the united states needs our european allies? when it's based only on collective defense, it's relevant for the future. you laid out the stark numbers about defense capabilities and defense investment and laid out the important obstacles we face with overcoming the defense industry and sovereignty. there's a lot to get into here. i want to pick up a couple but there's a lot of interest in the

audience. let me start where you ended on the nuclear point. our next conversation with john cartwright and others will get into nuclear missile defense issues for the alliance. you said, correct me if i'm wrong, i think you said when you were saying if collective defense is the focus, that actually is a path to relevance. disarmement and arms control might be as important commitments for the alliance for its future. while you served as ambassador at nato, you went through the deterrence and defense posture review and our danish colleague noted that was not a challenge to policy and you have the constraints on what the alliance might do with its own substrategic nuclear weapons and absence it moves on russia's part. what's the way forward given that was a really strong message you ended on? >> well, i would argue that i spent a lot of time on this.

first, let me -- anybody who knows me, i've been arguing about this since 1988, including the need to get rid of nuclear weapons in europe. it's not a surprise that's my view, nor was it to anybody in the administration, even though not everybody agreed with it. and we work very hard in deterrence and defense posture review and commitments to make clear that it is possible under the right circumstances not only to produce our reliance but in fact eliminate our reliance on u.s. nuclear weapons in europe. there is nothing in these documents that prohibits the possibility of getting there. we do talk about russian reciprocity, but it doesn't talk about russian agreements. we talk about the need to work together within the alliance but it doesn't talk about the fact that russia can have a veto on what we do.

i would argue over the last four years, we have substantially addressed the key deterrence issues of our time. we have found ways to bolster der terrence across the board. i know this will be an issue discussed in the next panel, but the deployment of missile defenses is not just a promise. it's a reality. it exists today. and it is part of a commitment that this administration has made to nato to take a u.s. deployment of u.s. missile defenses to defend the u.s. from europe into deployment of a nato missile defense to in nato to defend nato. that was the fundamental shift that occurred in september of 2009. to take a system that was able to deploy against possibly 10 incoming missiles and put in place a nato system under the nato command and control for the

defense of nato countries. that is the kind of commitment to deterrence that we put in place. we put in place contingency planning to make sure that every nation that is a member of nato has a plan to be defended. that was an important contribution to deterrence. we just completed this month, this week, last week, the first major article 5 live exercise, the alliance has conducted in the last ten years. many of the countries that participated in the exercise had never participated in an article 5 exercise and we just completed that. those are the kinds of steps that really matter for collective defense. far more than how many nuclear weapons you may have and what country. particularly when the cost of

modernizing those nuclear weapons runs into 10-plus billion, and the cost of modernizing the aircraft to carrying the nuclear weapons runs into the hundreds of millions of dollars, it is those kind of strength of deterrence that ought to be the the focus of our effort ask using arms across disarmement and cooperative security more broadly as a means to enhance nato's deterrence and defense posture. >> the announcement of the so-called pivot to asia led to a lot of discussion among nato allies and europeans for what it meant for them. you just said something important, the real pivot may have been the reality of defense spending in asia outpacing europe for the first time last year. you cited the efforts of gates and his concerns, speeches about potential demilitarization in europe and secretary panetta as well.

it doesn't seem to be -- have the impact or helped turn the tide on these issues, given the reality of the politics in the countries where members of the alliance and economic situation, what is the path forward here to knock the natural continuation of a decline you outlined so articulately in defense spending? >> well, i think that's the message i'm here to repeat. i don't think this is a time for agonizing reappraisals. frankly, there wasn't a time in 1954 for an agonizing reappraisal. this isn't one either. the message is that we need europe. europe is our most important strategic partner. they are the countries that when the matter sat hand will be on our side. but a europe that isn't capable to be there isn't very useful to us.

and the message that says, frankly, if you can't be on our side because you lack the capability, then that's bad for us but it's certainly not good for you. is the message that i heard secretary gates, secretary panetta and secretary clinton deliver over and over and over again. and the reality is that it means that we will have to make choices when it comes to when and how to intervene and what place and for what purposes we will make choices. libya was a choice. we could have taken on the entire libya campaign by ourselves. and we decided that the interest most at stake were not ours. they were countries in the mediterranean. i herd stefanini talking earlier about the importance of the threats from the south and the understanding that these are threats to the entire alliance. and libya was a response to that. but it shouldn't be surprising in fact, it should be welcomed that countries in the mediterranean that were nato members took on the

responsibility for taking on libya. and that's how it should be. it is right that the basis that we flew our planes from were in italy and greece, rather than in poland, not only because it takes a lot longer to get from poland to libya than it does from italy but because our interests are at stake. there may be other conflicts that come down the pike where our interests are not as much directly involved as they are from other countries. but then the question comes, are those countries as they were in libya, able to do what is necessary or will they have lost the capability to do so? that's when we really will see what's important and what matters. and those are the kinds of decisions that, frankly, i don't see countries in europe debating. i hope i'm wrong and i hope the european council meeting at the end in december that will be the first one in many, many years to

talk about defense will take a very serious look at what it means to be serious about defense. because frankly, right now it doesn't look like europe is sufficiently serious about the defense that it needs to have, not only to serve its own interest but, frankly, those of the alliance as a whole. >> you put a lot of issues on the table. i want to bring in this audience which is very knowledgeable about nato issues. please introduce yourself and ask a quick question. we're on the record, you're welcome to tweet. hash tag for the day is future nato. you'll see ambassador's handle on the agenda as well. evohdaalder. if we could have the mike here and i'll come back here. i'm harlan allman, atlantic council. ivo, thanks for your comments. i think you raised the critical question, will nato be around in a substantive way when we need

it or it needs itself? as you know, one of the things nato has not done well is to provide a strong message as to why it's important. now, perhaps we won't have the same christmas that lord is may said when he said the reason was to keep the russians out, us in and germans down. why do you think nato has had such a tough time coming up with a message and what would you put as a core of that message, realizing that defense spending will go down substantially, not up? >> i think that's a very fair and very important good question. i think we have gone through a period, frankly, since the end of the cold war where we believe that we're in sort of a new n nirvana, a place in which conflict doesn't occur, and if it occurs, it's economic, not military. where in a -- what do -- robert

cooper call it, a post-west failing world, and that somehow working together sharing sovereignty, focusing on the rule of law will make the 20th century, as you remember mark leonard saying, the 21st century europe century. i think some of the reality of that has come back home, and, no, actually, to be a real strategic power in this world, it is not enough to be economically strong which, by the way, in the last five years doesn't look that good, to have civic power, that's important, but you also need good old-fashioned hard military power. how far that has penetrated at the elite level isn't clear to me. it certainly hasn't penetrated enough in the parliamentary level, and we need to do a much better job in explaining why it is important that nations who would like to be taken seriously in the world require military

capabilities to be partners in the larger endeavors that confront us. but let's be clear. it's not clear that in this country there is the kind of support we may need for defense spending at large, and it is definitely clear there is no support or no knowledge for nato. much of our parliamently -- our congre congressmen and senators don't know much about nato. most would be surprised that nato continues not only to run the afghan mission but have between a third and a half of the troops there from european countries. so we have done not a particularly good job of explaining the importance of nato to our own security, to our own -- to what it is that europe and nato contribute to what we do day in and day out. so before we start lecturing our european friends about