So, Does the USA's Iron Triangle Frustrate You?

pray you're not European

As we are about to enter the third year of the Russo-Ukrainian War, one would think that the European survival instincts would have kicked in. I’m not sure what more of a reminder they would need that their ages-old nemesis from the East is back at their throat and it was time to awake from slumber and get ready.

Well, you’d be wrong.

For too long Europe has rested on the shield and sword from North America. Generations of their leadership and chattering class have been able to feather their nests, buy their votes, and not make hard choices because, in the end, they feel that Uncle Sam will be there for them - and we have.

As I’ve been warning my European friends for decades, we are just one election, domestic turmoil, or natural disaster away from simply pulling back behind our Atlantic moat. Well, that or we have to fight a Great Pacific War.

Some of the secondary and tertiary powers in Europe, the small Baltic Republics and the medium power of Poland, know what needs to be done - but they are not a Germany, United Kingdom, France or Italy.

Oh, and their increasing independent defense industry? The American one is a well run machine in comparison;

Over at the Financial Times,

In the US, with a defence budget that has just surpassed a trillion dollars annually, unlocking the Bank of Uncle Sam is less of a problem. In Europe, investors are beholden to piecemeal, country-by-country contracts in a procurement system that was optimised during peacetime to be slow, careful, and prudent.

Today, with two conflicts on its landmass, there is no sign of urgency to change. European Lethargy is in full play.

Nathan Benaich, founder of Air Street Capital and co-author of the European Dynamism and Defense research, says that “Europe is fundamentally not serious about defence.

…

The US has a comprehensive military strategy and so founders can easily build technologies that are on the government’s “wish list” or capabilities roadmap. Thus, venture investing in American defence tech is somewhat less risky. You can invest in the startups that are building technologies which are on a sure path to large, military contracts.

In Europe, chaos rules supreme; there is no common military defence strategy. Behind closed doors, when asking a group of European ministers about defence, it is not uncommon for the response to be: “Defend Europe against whom? My enemy is not their enemy.” Thus, the complexity of investing in much needed technology in Europe carries the additional risk that, without any defence plan, there are no contracts to procure. And without contracts, there is no revenue. And without revenue, there is no return on investment. Womp womp.

…

But still, with conflict on its shores, and a supposed desire for European sovereignty, there is a persisting lack of public sector signal that it wants or needs novel capabilities. Or at least, there’s no signalling that the European governments are willing to pay for it. 

The age of American dominance in European security looks like it won’t end anytime soon.