Strengthening NATO for Cold War 2.0

In the aftermath of World War II, the need for a unified defense against looming threats led to NATO’s formation in 1949. Formed as a beacon of stability, democracy, and economic recovery, NATO has evolved into the cornerstone of transatlantic security. It institutionally knits together defense, diplomacy, and economic prosperity into a unified front.

Today, NATO faces challenges with shifting US priorities, especially with recent leadership changes. Headlines like “Donald Trump's Election Win Leaves NATO Facing 'Immediate Crisis', “Trump Will Test European Solidarity on NATO, Ukraine and Trade,” and “US President Trump criticizes UN, NATO, and climate ‘hoax’,” reflect growing anxieties across the alliance. With a known NATO skeptic at the helm of the United States, this underscores the need for the alliance to adapt, especially as American hegemony has waned, leading to a new multipolar world, best described as Cold War 2.0.

Cold War 2.0 represents a renewed era of strategic rivalry—this time, not just between the United States and Russia, but among a broader axis of authoritarian regimes (China, Russia, North Korea, and Iran). Unlike the bipolar Cold War of 1947-1991, this is a multipolar contest with economic competition, disinformation, and digital-age capabilities at the forefront. This new era challenges conventional defense thinking.

While Cold War 1.0 was a bipolar conflict with clear ideological lines, Cold War 2.0 is a multipolar struggle involving both Russia and China as major powers coordinating an anti-Western alliance of authoritarian governments (e.g., Iran, North Korea, Venezuela, etc.), such as proposing an alternative currency to the US dollar. Shifts in technology, now featuring advanced cyber and electronic warfare, influence operations, social media, artificial intelligence, quantum computing, and space capabilities, require NATO to modernize its offensive and defensive postures. 

Unlike the conventional military standoffs and indirect warfare (e.g., use of proxies) of Cold War 1.0, Cold War 2.0 involves hybrid warfare tactics, including cyber-attacks, disinformation campaigns, lawfare, and economic coercion, while also incorporating more conventional military confrontations. Recent examples include the use of Russian drones targeting Polish territory and the incursion of Russian fighter jets into Estonian airspace, underscoring the growing threat in the region. This shift demands a new form of NATO that is competitive in the digital age and has a defense industrial base capable of matching China and Russia. As the United States and the rest of NATO grapples with these dynamics, the alliance must enhance its defense capabilities, solidify its economic partnerships, secure supply chains and needed minerals, and find the right mix of exquisite v. cheap-and-easy-to-produce weapon systems to be successful at hybrid warfare and also to be able to conduct large-scale combat operations.

This article explores how the United States benefits from NATO, the necessity for increased NATO spending, and the importance of European leadership and responsibility sharing. By addressing these key areas, NATO can ensure its relevance and readiness as a competitive alliance in the Cold War 2.0 era.

How the United States Benefits from NATO
NATO has evolved from its original purpose of deterring Soviet aggression to becoming a vital instrument of American global power. The alliance offers the US benefits beyond military protection; it bolsters US economic interests, amplifies American influence abroad, and ensures the stability of key regions. This section explores the multifaceted ways that NATO continues to deliver strategic dividends for the US—including economic gains, global stability, collective security, strategic military positioning, and sustained global leadership.

Economics
NATO is a critical market for US defense manufacturers, with “55% of the arms imports by European states in 2019-2023” coming from the United States. Major purchases in 2023 included $29.75 billion from Poland for AH-64E helicopters, HIMARs artillery systems, integrated air and missile defense systems, and the M1A1 main battle tank. Germany was also a major purchaser, ordering $11.4 billion worth of CH-47F helicopters and AIM 120C-8 Advanced Air-to-Air Missiles. A recent RAND Report found a positive correlation between US defense commitments and economic benefits. The report added that reducing security commitments would result in an 18 percent decrease in bilateral trade, with a corresponding loss of approximately $577 billion in 2015 dollars, resulting in the US GDP declining by about $490 billion.

Beyond defense contracts, NATO secures global trade routes and deters instability, protecting economic interests on both sides of the Atlantic. The stability fostered by NATO membership has been particularly evident in Eastern Europe, where economic growth accelerated after joining the alliance – and has been crucial for ensuring unity in the defense of Ukraine since Russia invaded in 2022.

Stability
Equally important is the benefit of international stability and security to economic growth. NATO membership has directly correlated with economic development for new NATO states, creating more resilient and profitable markets for US exports. Secure trade routes are the bedrock of the modern integrated economy, and NATO's security umbrella ensures unfettered access to markets and freedom of navigation. Additionally, NATO's commitment to stability helps prevent refugee crises, economic downturns, and threats that can reach US shores.

Article 5—Collective Security
NATO provides an additional security umbrella for the United States. Article 5 of the NATO Treaty asserts that “an armed attack against one or more of them in Europe or North America shall be considered an attack against them all. The only time NATO invoked Article 5 was in the defense of the United States after 9/11, launching Operation Eagle Assist to patrol US skies from October 2001 to mid-May 2002 and Operation Active Endeavor to patrol the Mediterranean and deter terrorist activities.

Military Presence and Strategic Reach 
The US military presence in Europe ensures unparalleled global influence, enabling the projection of power far from its shores. NATO provides key bases across Europe, allowing for rapid deployment to conflict zones and quick responses to protect US interests in Europe, Africa, and the Middle East.

NATO also amplifies US influence on global security policy through security missions in Kosovo, Iraq, and NATO Air Policing, as well as naval patrols in the Atlantic Ocean and various seas. NATO's formation of the International Security Assistance Force (ISAF) to develop Afghan security forces and its assistance in training Iraqi security forces post-invasion further highlight its contributions to US and coalition efforts.

US leadership of NATO through the Supreme Allied Commander Europe (SACEUR) provides America with a unique platform to pursue its objectives in Europe and beyond. This leadership ensures that America's allies remain aligned with US objectives on issues ranging from Russian aggression to countering China in the Pacific. NATO is crucial to maintaining the United States' position as a global superpower, offering an essential venue for sustaining American influence and supporting its objectives on the world stage.

NATO Spending and Perennial European Underinvestment 
While the political divide in the US is greater than ever, with the two parties agreeing on little, one piece of common ground is the long-held belief that Washington’s NATO allies have benefited from the US defense umbrella while allowing their capabilities to atrophy. In February 2024, Trump told a campaign rally that he would not defend NATO states that did not pay their fair share, and in early January, suggested that NATO countries need to spend 5% of GDP on defense, far above the traditional 2% benchmark. The political pressure, combined with Russia’s continued aggression, culminated in the June 2025 Hague Declaration, where NATO allies committed to increasing annual defense and security-related spending to 5% of GDP by 2035.

Encouragingly, the large-scale Russian invasion of Ukraine, combined with continued Russian hybrid aggression elsewhere in Europe, has acted as a wake-up call. European states have significantly ramped up defense spending and are investing in their industrial bases to match Russia’s wartime production capabilities. According to the Kiel Institute, since 2022, Europe has provided over $124 billion worth of aid (economic, military, and humanitarian) to Ukraine, exceeding the US contribution of over $88 billion. Europe has also led the way with training the Ukrainian Armed Forces. For example, since 2022, the West has trained over 156,000 Ukrainian troops, with the United States only contributing 17 percent of this training. Finally, the European Union established the European Union Military Assistance Mission (EUMAM) to Ukraine, which has trained and equipped over 60,000 Ukrainian soldiers.

Importantly, many EU militaries are leveraging the insights gleaned from training Ukrainians to inform their own doctrine and tactics, which further strengthens joint military warfighting across NATO. Additionally, the emergence of EU defense structures independent of NATO, including its own military headquarters in Brussels with greater strategic capacity, reflects a growing push for Europe to exercise “strategic autonomy” while simultaneously strengthening the NATO alliance. Europe’s pursuit of strategic autonomy, exemplified through initiatives like EUMAM, reflects a maturing security architecture capable of independent action. However, NATO remains indispensable as a cohesive framework for managing multipolar challenges.

An essay from the Atlantic Council asserted that the United States' NATO allies could demonstrate their commitment to self-defense by filling "the gaps in strategic enablers that the United States currently supplies for Europe's defense. This means building out airlift capabilities, air-to-air refueling, and intelligence, surveillance, and reconnaissance aircraft and platforms." Such a build-out of indigenous European military capability would also insulate NATO from any uncertainty in the Trump administration's policy towards the alliance, maintaining NATO as a credible and viable force.

European Leadership and Responsibility Sharing
As NATO recalibrates for Cold War 2.0, Italy’s strategic role in the Mediterranean becomes increasingly vital. Rome can leverage its geographic position and deep ties with North Africa and the Balkans to reinforce NATO’s southern flank and support broader European security initiatives. 

European Allies in NATO must also emphasize their essential role in US security by taking more responsibility for leading the alliance in securing Europe, the Arctic, and the North Atlantic. The messaging for this effort will also be critical, and it should likely be termed a “responsibility” rather than a “burden.” The security of the alliance is a shared responsibility. 

This could take the form of NATO taking greater responsibility for the security of its Northern Flank, with the ascension of Finland and Sweden to the alliance providing an excellent opportunity to capitalize on new expertise and planning. A recently released RAND report notes that the Arctic is exceptional because it is “the sole part of the globe in which the two primary competitors to the United States, Russia and China, are operating in increasingly close proximity to North America and across different domains—economically, in the information environment, and even militarily.” Given the geostrategic challenge facing the US of an increasingly belligerent Russia, potentially allied with a resurgent China, NATO must secure Europe and the Arctic from Sino-Russian aggression, allowing the US to pivot to Asia. Along similar lines, NATO allies already mentioned a willingness to pivot to Asia in 2019 due to the growing challenge of China. This represents another monumental movement in defense thinking for NATO in remaining relevant to the United States.

Conclusion
The return of President Donald Trump in 2025 confronts NATO with a critical inflection point. Amid the intensifying geopolitical rivalries of Cold War 2.0, the alliance must adapt or risk becoming outdated. The alliance has seen difficulty before. In 1966, France withdrew its troops from NATO command in an attempt to gain greater autonomy. US President Johnson understood that if he criticized France after President de Gaulle’s decision, it “would have just made the French people more difficult to deal with.” The alliance endured—and ultimately grew stronger—despite this temporary rupture. Similarly, in the current environment, Europe would do well to avoid vilifying Trump and the United States. Rather, Europe must step forward militarily and industrially, not in competition with NATO but in support of it.

This historical episode offers a useful analogy for today. While US politics may feel unstable, the transatlantic bond has repeatedly proven resilient. NATO does not require perfect harmony to function; it requires mutual strategic interest and steady investment from all parties. Rather than viewing Trump’s return as cause to abandon the alliance, Europe should seize the moment to shape NATO’s future, assertively and constructively.

Thriving means NATO must modernize its capabilities and procedures, invest in emerging technologies, and secure industrial and economic resilience. A revitalized NATO, emphasizing increased defense spending and transatlantic industrial partnerships, offers significant opportunities for European defense firms, enhancing strategic resilience and technological growth.

NATO's future lies in Europe's ability to assume a more significant role in its defense, with the United States playing a supporting rather than leading role. America still needs NATO, just as NATO still needs America, but the United States requires a more self-sufficient alliance that can work as an equal partner in providing international security. For Europe, the alliance offers unmatched access to US intelligence, logistics, strategic lift, and nuclear deterrence—capabilities no European coalition could recreate alone. 

NATO leadership must remind the US of the substantial benefits it gains from the alliance, which far outweigh the costs. Rejuvenating NATO is crucial for transatlantic security and global stability. The alliance must reaffirm its commitment to shared values of democracy and rule of law, demonstrating resilience in the face of authoritarian challenges. It also means making sure Ukraine is not conquered by Russia, while also making sure China is deterred from invading Taiwan. Strategic convergence, not political alignment, has always been the glue that holds NATO together. Only by adapting to Cold War 2.0 can NATO remain the cornerstone of transatlantic security and the guarantor of democratic resilience against rising authoritarian powers.