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At the beginning of last week, Russian President Vladimir Putin’s “three-day war” in Ukraine passed the three-year mark. This dark anniversary came with a glimmer of light: the growing prospect of peace talks.
But after a surprise phone call between Putin and President Donald J. Trump, the only ones showing much optimism were Russian leaders. By the end of last week, this optimism had turned to delight after Washington voted with Moscow on two UN resolutions and a disastrous public Oval Office meeting between Trump and Ukrainian President Volodymyr Zelensky.
Despite all the talk about talks, the only real change to the dynamics surrounding the conflict since President Trump took office is the creeping loss of Ukraine’s single biggest backer, the United States.
This was confirmed yesterday when the White House announced it would suspend all military aid to Ukraine in an attempt to compel Kyiv—and induce Moscow—into making a peace deal.
The Kremlin was quick to welcome this move. It is good news for Putin, who has been waiting three years for Ukraine’s supporters to capitulate.
But the same events were met with shock and horror in Europe, whose leaders quickly rallied around Zelensky and Ukraine. An informal meeting of European leaders in London on Sunday hosted by Prime Minister Sir Keir Starmer was rapidly reconfigured into a crisis summit with the stated goal of “securing our future.”
Their unstated goal was to say loud and clear to the people of Ukraine: Europe has got your back.
This message was also aimed at Washington and Moscow. Europe’s leaders are hoping Trump and Putin heard their call that, in Starmer’s words, “Europe must do the heavy lifting”—on both Ukraine and European security. They want to convince Trump they are taking his demands to share the burden of transatlantic security seriously, and Putin that “we are doubling down in our support” to Ukraine for the long haul.
Achieving all three goals—backing Ukraine, placating Trump, and outlasting Putin—will take more than crisis meetings and strong words. Since 2014, Europe has been taking defense more seriously. But thanks to Trump’s dramatic policy shift away from transatlantic security, the price tag of strengthening Ukraine and defending Europe just went up.
Europe is on the verge of a “big bang” moment, which could unlock more than a trillion dollars in funding for European defense over the next decade.
Fortunately, Europe is on the verge of a “big bang” moment, which could unlock more than a trillion dollars in funding for European defense over the next decade. An emergency EU summit on Thursday will see European leaders take the first steps in their journey to save Ukraine and lead the free world.
Europe’s most urgent task is to forge peace through strength in Ukraine. Getting Putin to the negotiating table will mean convincing him he cannot win the war now; getting a lasting ceasefire and peace deal will require convincing him he cannot try again later.
This is why the London summit committed Europe to “keep the military aid flowing . . . To strengthen Ukraine now,” and to “keep boosting Ukraine’s own defensive capabilities . . . To deter any future invasion.”
These commitments are even more pertinent in the absence of security guarantees for Ukraine. In London, leaders committed only to develop a “coalition of the willing,” but made any guarantees contingent on “strong US backing.” This is something President Trump has consistently played down—in part because preemptive security guarantees could undermine Trump’s main goal of getting Putin to the negotiating table. If Putin judges that guarantees—and European troops—will only appear once the fighting stops, then he won’t stop fighting.
But even if Trump can bring Putin to the negotiating table, it will be a tall order to persuade him to make peace.
Putin thinks he is winning in Ukraine and has little incentive to end the war. Russia may have lost hundreds of thousands of soldiers and up to a million (mostly young, educated) emigrants, but Putin has consolidated power at home and abroad. He has forged a wartime economy that is now producing more than all of Europe, tightened his grip on power through political repression and media control, and deepened his alliances with China, Iran, and North Korea. History suggests wars are good for dictators—even necessary. Besides, what Putin wants is not a slice of territory, but a Ukraine subjugated and neutered. No talks could ever satisfy those desires.
A more likely scenario is a repeat of the Minsk I and II process, in which Russia dragged out talks and repeatedly broke ceasefire agreements with little intention of reaching a lasting settlement. In the short term, this would provide cover for Russian forces to press forward and exploit Ukraine’s weakening position on the battlefield. In the longer term, it would buy time for Russian forces to regroup and reconstitute to attack again en masse when the time is right.
What really matters among all the noise about peace talks is Ukraine’s military strength.
This suggests what really matters among all the noise about peace talks is Ukraine’s military strength.
A strong Ukrainian military, which cannot be defeated on the battlefield, is the only realistic impediment to Russia’s crude but effective attempts to dominate its near abroad using military force. President Trump’s attempts at coercion and accommodation might be worth a shot, but diplomacy is no match for “brute force” when it comes to warlike leaders.
This wisdom was famously applied by the U.S. diplomat George F. Kennan in his 1946 long telegram, assessing Soviet power under Joseph Stalin as “impervious to logic of reason, and . . . highly sensitive to logic of force.” Kennan’s prescription was “a policy of firm containment” based on political, economic, and military strength.
The same words also describe Russian power under Vladimir Putin today. Zelensky echoed Kennan’s diagnosis when he addressed Ukraine’s parliament in October: “The Russian leadership acts aggressively only when it is convinced that it will not receive an adequate destructive response.”
In his address, Zelensky also channeled Kennan in his own prescription to secure Ukraine’s security via “peace through strength.” This phrase echoed one used by another U.S. official: Keith Kellogg. In a report published months before he was appointed as President Trump’s special envoy for Ukraine and Russia, Lt. General (Ret.) Kellogg describes Trump’s approach as promoting “deterrence and peace through strength.”
NATO and EU leaders have also identified peace through Ukrainian strength as the best solution for keeping their own citizens safe. As NATO Secretary General Mark Rutte declared after allied defense ministers met this month, NATO’s task is to “help Ukraine in its fight today and to build up Ukraine’s armed forces in the long-term.” And as European Commission President Ursula von der Leyen stated in the commission’s political guidelines last year: “The best investment in European security is investing in the security of Ukraine.”
Since the war began, peace through strength in Ukraine has been pursued through a combination of Western-funded equipment and Ukrainian grit. As Trump put it last week: “They’re very brave,” but “without the United States and its money and its military equipment, this war would have been over in a very short period of time.”
But this formula is now in doubt because Ukraine’s main backers are reaching the political and economic limits of what they can provide. Europe, Ukraine’s largest backer to date, has plenty of political will but is hitting the limit of its fiscal and industrial capacity. Meanwhile, the United States has the opposite problem: It can afford and produce much more, but the political desire to do so has disappeared under the new administration. (Compare the administration’s stance on Ukraine to the $4 billion in military assistance and $12 billion in military sales expedited to Israel since January, for example.)
Europe and the United States have been Ukraine’s largest backers since 2022. Europe has been the most generous, providing $138 billion (and committing another $120 billion), compared to $119 billion (and $4 billion) from the United States. When measured proportionately, the United States lags much further behind—19 European nations have given more to Ukraine than the U.S. total of 0.53 percent of GDP since 2022, with some European nations even exceeding 2 percent.
These are large sums of money, but they are not enough to meet Ukraine’s needs. Russian forces continue to grind out small victories on the battlefield and attack civilian areas with hundreds of cost-effective drone and missile strikes. Zelensky has already warned that Ukraine is now running out of Patriot air defense missiles. Moreover, as the authors of a Kiel Institute report point out, for most nations this level of funding is “like a minor political ‘pet project’ rather than a major fiscal effort,” comparable to domestic subsidies for diesel fuel and company cars.
Yet even at these relatively low and inadequate levels, both Europe and the United States have significant constraints on their ability to maintain aid to Ukraine.
Europe has a plentiful supply of political goodwill toward Ukraine but lacks the fiscal and industrial capacity to make good on it.
Although overall European defense spending has risen sharply since 2022, spending levels vary widely. Nations closer to Moscow spend much more than others. But some of the leaders in spending measured by percentage of GDP are laggards in absolute investment, due to the size of their economies. (For example, in 2024, Latvia’s 3.15 percent of GDP equated to just $1.4 billion, while Poland and Italy both spend just under $35 billion even though Poland spent 4 percent of its GDP compared to Italy’s 1.5 percent.) Neither does the GDP measure indicate the quality or nature of investment.
Meanwhile, the European Union is limited by its 2023 Stability and Growth Pact on borrowing large amounts to fund higher defense spending—like it did after Covid-19 through a recovery fund of $840 billion. EU member states have equivocated over removing borrowing limits on defense spending since the war began but have yet to pull the trigger.
Even if they do, increased spending might not solve the problem of Europe’s limited defense industrial capacity. Ukraine now depends on the defense industry in Europe and elsewhere for two-thirds of its military aid. But current capacity is either low or nonexistent in key areas such as guided weapons, tanks, and aircraft. “Europeans and the Ukrainians have nothing in their depots,” according to the CEO of Rheinmetall. Meanwhile, the Russian defense industry is now outproducing the whole of Europe (when measured by purchasing power parity). Hence the Kiel Institute’s assessment that the war has become “a battle of procurement and military production.”
The United States also has industrial capacity issues. However, Washington’s limits on providing support to Ukraine are primarily political.
A good shorthand for President Trump’s policies is to assume he will do the exact opposite of the Biden administration. This is true for Ukraine. While Biden committed to support Kyiv “for as long as it takes,” Trump campaigned on removing support for Ukraine. Where Biden aimed to force Russia to negotiate (or capitulate) by putting Ukraine in a position of strength, Trump aims to compel Ukraine to accept compromises for the sake of a deal and use the potential for Ukrainian weakness to incentivize Moscow. As he said when asked if the United States would keep providing Ukraine with weapons: “Maybe until we have a deal with Russia . . . We need to have a deal, otherwise it’s going to continue.”
This dramatic reversal in Washington’s policy leaves the burden of “peace through Ukrainian strength” resting on Europe’s shoulders. This may have been the whole point.
Washington’s shift in Ukraine policy was accompanied by a broader shift in its policy toward Europe. The last three weeks have cemented the new reality that transatlantic security is no longer Washington’s foreign policy priority.
This stance is not new—the United States has been pivoting to Asia since at least 2011. Neither does it mean Washington will abandon Europe. As U.S. Secretary of Defense Pete Hegseth told NATO defense ministers on February 13: “We must make NATO great again . . . suggestions of abandonment otherwise continue to be disingenuous and we are—we are proud to be part of this alliance and stand by it.”
Even so, Europe must now assume responsibility for its own security to an extent it has not done since before 1941. This will take decisive action and sustained investment to strengthen Ukraine’s hand and defend the continent from Russian aggression.
Insofar as they face an acute threat from Russia and an increasingly disinterested—or at least distracted—United States, Ukraine and Europe are in the same boat. If Europe is going to shoulder the burden of strengthening Ukraine and its own defenses, it is going to need a bigger boat. This means spending more on defense—a lot more.
The good news is that European defense is on the verge of a “big bang” moment that could transform its ability to do just that.
European defense was slow to rouse from its post–Cold War slumber. By 2022, EU defense spending was only 1.3 percent of GDP. This changed after Russia’s full-scale invasion, when European NATO allies raised defense investment to 2 percent of their collective GDP. Meanwhile, the European Union’s Versailles Declaration, adopted three weeks after the war began, led to several new initiatives designed to strengthen European defense and support Ukraine. These have provided tens of billions of euros for both European procurement and Ukrainian defense and reconstruction—including from the revenue of frozen Russian assets.
However, the true potential of European defense remains largely untapped.
The next NATO summit will take place in June in The Hague, the Netherlands. If every European member of NATO took that opportunity to raise defense spending from their current average of 2 percent to 3 percent—as at least four allies already did last year—it would raise nearly $200 billion. Germany alone could add $220 billion if it agrees on a new “whatever it takes” special fund for defense.
If EU leaders agreed to exempt defense spending from the current budget constraints, they could jointly borrow hundreds of billions toward their own target of investing over $500 billion in defense over the next decade.
If negotiations this year over the European Union’s next budget cycle (2028–2034) meet the target set by the bloc’s new defence commissioner, Andrius Kubilius, that could add $110 billion to EU defense spending (defense spending in the current cycle was only around $11 billion).
If Europe agreed to liquidate Russia’s frozen assets, it could provide another $300 billion. As Polish Prime Minister Donald Tusk has urged: “Enough talking, it’s time to act! Let’s finance our aid for Ukraine from the Russian frozen assets.”
If the European Commission is able to repurpose untapped Covid-19 recovery funds, it would make available up to $100 billion, while redirecting portions of the $50 billion EU “Cohesion Fund”—designed to help lower income member states through investment in environment and transport—could make several billion available for defense and security.
The original purpose of the London summit was to discuss the United Kingdom’s idea for a European “rearmament bank,” a joint fund to issue AAA-rated debt to finance increased defense spending across Europe. If agreed, this might raise up to $25 billion in government “seed funding,” which could underpin up to $250 billion of private capital.
European defense’s big-bang moment could be worth well over a trillion dollars.
There are a lot of “ifs” on the table. But taken together, these measures would unlock vast amounts of new funding. European defense’s big-bang moment could be worth well over a trillion dollars.
Ahead of Thursday’s meeting, von der Leyen has already previewed some of the measures on the table as part of a package called “ReARM Europe.” These include relaxing the European Union’s fiscal rules on debt for defense spending, a loan program of up to €150 billion ($165 billion) backed by the European Union’s common budget, and reallocating some of the Cohesion Fund. These initial measures still require EU leaders to unanimously agree with them. The biggest threat comes from Hungary, although Budapest’s opposition appears to be narrowly focused on support to Ukraine rather than strengthening European defense writ large.
Even if EU leaders can agree to these measures, a flood of new spending will not amount to much without the capacity to produce the weapons, ammunition, and equipment that Ukraine—and Europe—needs. As Rutte put it: “Our industry must be able to produce what our extra money allows us to procure.” Europe must transform itself into a modern arsenal of democracy.
EU leaders have repeatedly emphasized their aim of “ramping up defence production,” alongside financing defense and supporting Ukraine. This follows the 2024 European Defence Industrial Strategy (EDIS) and the Draghi report on competitiveness—both of which urged Europe to revitalize its defense industrial base.
Europe’s defense industry has struggled to overcome three decades of relative neglect. One high profile example is the failure to deliver the flagship procurement of 1 million NATO-standard 155 millimeter artillery shells for Ukraine. This target was eventually met but only after significant delays. This episode suggests Europe may struggle to provide Ukraine with more complex systems at scale, such as air and missile defense.
The good news is that Europe’s defense industry has retained a focus on quality and advanced technology, even while sacrificing capacity and increasing fragmentation. The challenge now is how to scale up and increase cooperation—a perennial challenge for Europe. The “big bang” approach advocated by Kubilius is designed to do this by aggregating demand and achieving economies of scale.
One example of what could be achieved is the European Union’s first investment in support for common procurement, a new $330 million incentive that has led to over $12 billion in multinational contracts for air and missile defense systems, armored vehicles, and artillery ammunition. There are also several examples of joint procurement for Ukraine. These amount to at least $5.5 billion to date, including a $1.0 billion Czechia-led ammunition initiative and the UK-led International Fund for Ukraine, which has provided at least $1.5 billion of military aid since 2023.
The European Union and NATO have long deployed incentive-backed instruments to encourage cooperation and innovation. But the small amounts of funding attached—millions not billions—have not made much difference. If this model can be applied across the defense industrial landscape using the flood of funding that may be about to appear, it would lead to a revolutionary change in European defense.
Another reason for a “big bang” approach to transforming European defense is a continued dependence on defense industries beyond Europe. Ukraine currently builds or finances about 55 percent of its military hardware but relies on Europe (25 percent) and the United States (20 percent) for the rest. For Europe, most of the money spent on defense since the war began has left the continent. According to the EDIS, 78 percent of new EU spending in 2022 and 2023 left Europe, with 63 percent of this going to the United States.
While this situation allows Ukraine and Europe to meet urgent combat requirements, recapitalize depleted stockpiles, and access complex systems they cannot produce on their own—such as Patriot missile defense systems or combat aircraft like the F-16 and F-35—it also undermines sovereign supply, exposing Europe to external supply challenges. This is why the EDIS gave member states the target of procuring at least 50 percent of defense equipment from within the European Union by 2030 and 60 percent by 2035.
Ukraine would also benefit from a stronger, more self-sufficient European defense industry.
Ukraine would also benefit from a stronger, more self-sufficient European defense industry. It already has to some extent, given that at least half of the military aid it has received since the start of the war came from Europe and at least 25 percent of its current supply of weapons and equipment is produced there. One example of a weapon system that has been critical to Ukraine’s performance on the battlefield is strike drones, which have helped Ukrainian forces overcome a 5:1 manpower deficit to fight Russian forces to a standstill. This month the German company Helsing announced it would supply Ukraine with 6,000 HX-2 strike drones—adding to the 4,000 HX-1 drones already being delivered.
The role of AI-enabled “precise mass” in Ukraine—and in modern warfare writ large—will place more emphasis on less exquisite technology like drones and artillery. This could be a boon for the European defense industry, and even a comparative advantage over the U.S. and Korean industries, which are more geared toward complex, high-end systems.
Ukraine’s own defense industry shows what’s possible. It already produces $30 billion a year in weapons, six times what it did just a year ago. Ukraine is now the world’s largest manufacturer of military autonomous systems, able to make over 4.5 million drones per year. It plans to make 30,000 long-range drones and 3,000 missiles this year. While the European Union struggled to make 1 million shells, Ukraine already makes 2.5 million artillery and mortar rounds annually. In the last year, Ukraine’s production of artillery systems tripled while production of armored vehicles increased fivefold. Europe will also benefit from this transformation if it can learn from Ukraine’s impressive ability to rapidly scale manufacturing, adopt commercial technology, and feed lessons from the front line into its procurement system.
However, Ukraine’s defense industry has grown so fast that its production capacity has outstripped financing. In a speech to the annual European Defence Agency conference last month, Ukrainian Defence Minister Rustem Umerov explained that while capacity will reach $37 billion this year, available funding is only $18 billion. Umerov appealed to Europe “to help us close this existing gap in financing” to make sure Ukraine’s production potential does not go to waste.
One way of doing this is the “Danish model” of procuring directly from Ukraine’s defense industry. In 2024, Denmark became the first country to order weapons made in Ukraine for use by Ukrainian armed forces. To date, around $950 million worth of Ukrainian-made artillery and drones have been ordered by Denmark and delivered to Ukraine. Denmark has also set up a “Defence Industry Hub” in Kyiv to enhance cooperation between the Danish and Ukrainian defense industries. At least two other countries have also adopted the “Danish model.” In October, the Netherlands announced a plan to purchase around $440 million of drones from Ukraine, with a 50–50 production share. Last week Norway also committed to buy $312 million of drones and other military equipment from Ukrainian firms.
Transforming European defense would also benefit the United States’ defense industry—the original arsenal of democracy—in three important ways. First, by giving even more buying power to the largest global importer of U.S. arms: Europe. No matter how quickly Europe revitalizes its own defense industry, it will continue to rely on U.S. companies for advanced air defense, combat aircraft, missile and long-range artillery systems, plus other technology. Second, expanded coproduction arrangements provide European leaders political and economic incentives to buy more U.S. weapons. They also lower the unit cost of weapons for Washington through economies of scale. Examples range from a recent $5.5 billion coproduction agreement for 1,000 Patriot interceptors, to a Cold War agreement to produce Sidewinder missiles in West Germany. Third, by enabling the United States to focus more squarely on its declared priority of Indo-Pacific security.
A “porcupine” military strategy is the best way for Ukraine to credibly deter Russia within the constraints it has on manpower, industrial capacity, and cost.
If Europe can generate a flood of new funding and transform its defense industry, the only remaining question is what purpose would all this military power serve? The answer for Ukraine was provided by President von der Leyen: “It is basically turning Ukraine into a steel porcupine that is indigestible for potential invaders.” A “porcupine” military strategy is the best way for Ukraine to credibly deter Russia within the constraints it has on manpower, industrial capacity, and cost. It would also minimize any security dilemma with Russia by being a conspicuously defensive force. For Europe, the answer is much more of the same: deterrence and defense.
On March 10, 2022, just days after Russia’s invasion began, EU leaders met in Versailles. They declared that “Russia’s war of aggression constitutes a tectonic shift in European history” and agreed on an ambitious agenda to strengthen European defense and support Ukraine.
Thursday’s summit could be another Versailles moment for Europe. The last two weeks have produced another tectonic shift that demands a continent-wide response. Through their urgent plan to “rearm Europe,” European leaders must find a way to unlock a trillion euros to fund large increases in defense spending and transform Europe’s industrial base.
This moment was years in the making. Since 2014, the pressure on European defense has been building. Increased spending and a proliferation of initiatives to strengthen EU defense and the “European pillar” of NATO have laid the foundations.
The only thing missing was a spark to ignite the big bang—until President Trump provided a shower of sparks in a week that “shook up the world.” The events which followed his February 12 call with the Kremlin threatened to put transatlantic relations back to 1941 as he considered appeasing Putin, called Zelensky a “dictator,” berated Europe, and cut off Ukraine (even if only temporarily).
The result of these watershed events was summarized by one Wall Street Journal headline: “Trump, Not Putin, Forces Europe to Get Serious About Defense.” Or as one observer on Bluesky put it: “European defence was born this week—by caesarian, but still.”
And after Friday’s shouting match in the Oval Office added more fuel to the fire, Kaja Kallas, the European Union’s high representative for foreign affairs, declared: “Today, it became clear that the free world needs a new leader. It’s up to us, Europeans, to take this challenge.”
The most important thing Europe can do for Ukraine and the free world is transform its ability to defend the continent from Russian aggression.
If Europe’s big bang comes to fruition, it could generate vast amounts of new defense investment in the coming years. But this moment is about more than funding, as Kallas implies. The most important thing Europe can do for Ukraine and the free world is transform its ability to defend the continent from Russian aggression.
Like the Soviet Union during the Cold War, Putin’s Russia is the biggest threat to a Europe whole and free. And just like the Cold War, the consequences of the confrontation between Russia and the West are global. Unlike his Soviet-communist counterparts, Putin might not want to “run the world”—but he would like to see the world run by fellow autocrats. This world would eschew the liberal rules and norms that have guided the conduct of international relations since 1945, a period of unprecedented global peace, prosperity, and liberty.
Instead, the world would be a much darker place where might makes right. Powerful countries would be entitled to spheres of influence within which they would be free to dominate and subjugate weaker countries.
The war in Ukraine shows what a world of authoritarian “multipolarity” would look like. It is not just a battle for Ukrainian sovereignty, but for the future of global order. Ukraine is the first bulwark against a world of authoritarian disorder—which is why it must be strengthened.
The second bulwark is Europe itself—hence the need to rearm, quickly, and at scale.
The third bulwark is the United States. By withdrawing its support for Ukraine, questioning its own role in transatlantic security, and appearing to align with Russia on key issues, President Trump risks weakening the West’s defense against authoritarian disorder. It is possible that Trump is betting that his unprecedented actions will provide the spark Europe needed to ignite its big bang transformation into a defense superpower.
Either way, Europe’s leaders now have the motivation and the means to save Ukraine and stop Putin. As Starmer put it, they are at a “crossroads in our history.” It is now up to them to lead the free world through this crucial moment.
Sean Monaghan is a visiting fellow in the Europe, Russia, and Eurasia Program at the Center for Strategic and International Studies in Washington, D.C.
This report is made possible by general support to CSIS. No direct sponsorship contributed to this report.
