Whither Europe (2): Making War and Military Spending 'Sustainable'

The EU is poised for a transformation towards centralised control and tyranny, and here are four key policy decisions that will affect you wherever you

Prelim: I’ve penned another long-form essay for the good people over at Propaganda in Focus, an online webzine brought into existence by Mark Crispin Miller, Piers Robinson, and others a few years ago.

It’s based on initial writings in these pages, and since its content constitutes a refinement (due to editorial oversight, which result in a bit more careful wording), I thought you’d might find the essay interesting, too.

A word of warning: it’s a para-academic piece—keeping with the Propaganda in Focus style—running at over 10K words in the final version; therefore, we decided to split it in two for the long-form essay, but I’ll be posting it here in four instalments.

For the first quarter, please follow the below link:

Whither Europe (1): Normalising Covid Passports

And now, let’s move on to part two.

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War is ‘Sustainable’, According to the EU Commission

Among the key features of the European Union is the special status of the various treaties, which the bloc considers foundational: ‘Treaties are the starting point for EU law and are hence referred to as primary law.’ They are accompanied by legislative and non-legislative acts referred to as ‘secondary law’, which include regulations, directives, decisions, recommendations, and opinions (while this author has written about this issue elsewhere, careful attention to this taxonomy is warranted). This kind of information is necessary to understand what has transpired since the last EU elections in spring 2024 and the beginning of Ursula von der Leyen’s second term.

As reported by the Berliner Zeitung in early December 2024, ‘a “new era of European defence and security” is upon the peoples of Europe, ‘in order to be able to defend Europe “against Russia and other powers” [meant is, of course, China, according to the bloc’s Foreign Commissioner Kaja Kallas, my addition], additional funds totalling at least 500 billion euros over a period of ten years are necessary’. While 50 billion euros of additional defence spending per year is not nothing, it does not alter the balance of power in a meaningful way. What this move means, however, is a fundamental re-ordering of the EU’s primary law, the treaties, as outlined in the ‘Strategy for the defence industry at EU level’ (EDIS).

Published in March 2024 — and thus months before the elections, which took place from 6-9 June 2024 — the EDIS paper

… announces actions that bolster the EDTIB [European defence technological and industrial base] through ‘increased, more collaborative and European investment from Member States’; strengthen the European defence industry’s ability to respond quickly and adapt to any situation; mainstream a culture of defence readiness across all EU policies; and join forces with the EU’s global, like-minded, and strategic partners.

Mention is made of the formalisation of NATO’s spending target (two per cent of GDP), which occurred in 2014 at NATO’s summit in Wales. Since EU countries are, on average, about a third short of that spending target, this policy decision adds another 175 billion annually over the next ten years, which brings ‘defence’ spending in the EU close to US levels (at least in nominal terms). The main alteration to the EU treaties, however, is tucked away in the following paragraph:

In terms of industrial gaps, the EDTIB is fragmented on both the demand and supply side. According to the investment gap analysis, the primary source of demand for domestic defence industries are their national governments, which also set the export regulations and oversee the entire procurement process for defence equipment. This has caused national defence companies operating in small markets to produce products in quantities that are wholly insufficient for the current geopolitical environment.

This is literally the money paragraph: it means, in no uncertain terms, that the EU Commission desires the agglomeration of these many small defence industrial bases of the various bloc members into a gigantic, EU-wide cartel, or trust (monopoly). In practice, EU leaders recognise that they would need to implement unified command and procurement structures to act (more) forcefully on a global scale. The EDIS paper also outlines how this is to be achieved:

EDIS proposes a Defence Industrial Readiness Board, which would include representatives of the Member States, the EU High Representative and the Commission. The board should carry out the EU defence joint programming and procurement function called for in the defence investment gap analysis. The proposed EDIP regulation would formally create the board, which would also assist in the EDIP’s implementation.

At this point, please allow me to outline what is happening: a new institutional framework (‘board’) will be set up, which calls out the problem (‘investment gap’), proposes ‘regulation’ (that would be ‘secondary legislation’ [never mind that there’s no foundation in the Treaties, i.e., ‘primary law]’), and ‘assist in [its] implementation’. If you held concerns about the EU’s so-called ‘democratic deficit’ in the past, this joint command and procurement structure turbocharges these problems.

The EU has no separation of powers (in constitutional terms), and the envisioned EDIP policy is poised to formalise, via bureaucratic streamlining, this situation by creating a new directorate (‘board’) that will be issuing ‘regulations’ (that would be the EU Commission’s prerogative) based on its own ‘analyses’, and ‘assist’ in their ‘implementation’. In other words, this new institutional setup will permit the Commission to bypass existing procedures and creates a mechanism by which an unaccountable entity (the ‘board’) will spend on defence projects without any oversight by, let alone accountability to, anyone. Talk about judge, jury, and executioner being the very same (legal) person.

Having reached this junction, questions about the financing of these measures arise, and, expectably, the EDIS paper also proposes how to do this: ‘EU Commissioner for the Internal Market Thierry Breton (poised to join Bank of America) pitched a debt-financed €100 billion fund during an event in January 2024 to boost joint procurement of defence products.’ While this sounds eminently reasonable, there are explicit clauses in both the Article 41 (2) of the Treaty on European Union (TEU) and Article 173 of the Treaty on the Functioning of the European Union (TFEU) that forbid joint debt-based financing of military expenditures (here and in the following, emphases mine):

Art. 41 (2) TEU: Operating expenditure to which the implementation of this Chapter gives rise shall also be charged to the Union budget, except for such expenditure arising from operations having military or defence implications …

As for expenditure arising from operations having military or defence implications, Member States whose representatives in the Council have made a formal declaration under Article 31(1), second subparagraph, shall not be obliged to contribute to the financing thereof.

Art. 173 (2) TFEU: This Title shall not provide a basis for the introduction by the Union of any measure which could lead to a distortion of competition or contains tax provisions.

Article 41 (2) TEU basically affords any member-state an opt-out option (in addition to a clear ban on joint defence spending), adding that no member-state may be compelled. Article 173 TFEU, by contrast, functions in a way reminiscent of the US Commerce Clause, which is pertinent as joint procurement of military hardware in contexts that are ‘fragmented on both the demand and supply side’ and ‘defence companies operating in small markets’. In other words: the creation of a cartel-like defence-industrial base with joint procurement and acquisition mechanisms, surely constitutes ‘a distortion of competition’, to say nothing about the lingering questions about their financing.

Speaking of paying for these military investments, the Berliner Zeitung also explains how the EU Commission plans to avoid any legal challenges that might arise: ‘Brussels wants to classify armaments as sustainable [orig. nachhaltig]’, thus ‘not only polish[ing] the image of arms manufacturers, but manufacturers of tanks, missiles or even nuclear weapons could in future hide in “sustainable” share packages and funds without investors realising it’. Courtesy of an enquiry of left-wing MEP Fabio de Masi, here is how the EU Commission is bending the true and generally accepted meaning of (primary) law:

The framework for sustainable finance aims to incentivise investment in activities that contribute to the EU’s environmental objectives, it says. And ‘defence companies’ could, ‘just like companies from other sectors, report investments in the greening of their buildings or in transport solutions based on the taxonomy, for example’… The fact that armaments are also categorised as sustainable shows ‘that the military-industrial complex has Europe firmly in its grip’, said De Masi…Von der Leyen’s Green New Deal is above all a deal for lobbyists who want to greenwash the dirtiest business, war, via taxonomy. ‘This shows the madness: nothing is as harmful to the climate as war and destruction, but the main thing is that the tank saves fuel or the missiles are produced in a more climate-efficient way,’ said De Masi.

At this point, we can observe the true nature of the Janus-like, two-faced EU deus ex machina: while Art. 41 (2) TEU (‘primary law’) is crystal clear about the ban on joint military spending, Brussels may also refrain from preferential treatment of certain manufacturers over other companies (e.g., big over small arms manufacturers) and/or facilitate their cartel-like amalgamation due to joint procurement of military hardware, which goes against Art. 173 TFEU (also ‘primary law’). To resolve this conundrum, the EDIS paper thus envisions the following ‘creative’ solution:

According to Article 41 (2) of the Treaty on European Union, no expenditure that implies military or defence operations may be funded by the EU budget. However according to Article 173 of the Treaty on the Functioning of the European Union, the EU is responsible for enhancing the competitiveness of European industry, which includes the European defence industry. Thus, the EU defence industry can be supported by the EU budget.

We may now piece together how the EU Commission seeks to amend its very own ‘primary law’: Art. 41 (2) TEU was supposed to be (ab)used to go around the taxpayer-financing of any of the military-industrial plans of the Commission — by resorting to debt-based financing of this entire scheme. In other words: no taxes will be earmarked for this (which would be blatantly illegal), hence permitting claims of ‘we didn’t break any of the primary law’, which, given the twisted nature of these matters, would technically not be entirely inaccurate. At the same time, Art. 173 TFEU was to be (ab)used to extend the purview of the Commission’s competition-enhancing authority from ‘domestic’, that is, intra-bloc, intent to render the EU’s defence-industrial base more ‘competitive’ on a global level.

As to the actions outlined in the EDIS paper, the Commission’s stance appears to be that ‘we just did something that’s not explicitly mentioned in any of the Treaties’, although that kind of claim is highly questionable in light of the Maastricht Treaty’s ban on the raising of shared, or pooled, debt. These clauses are so fundamental that there is a wealth of considerations available, most notably from the European Central Bank (‘five things you need to know’) and the German Bundesbank (‘Maastricht debt’). While many of these relate debt criteria, these developments have not escaped relevant commentators, such as the Centre for European Reform’s Luigi Scazzieri and Sander Tordoir who recently released a policy paper asking, ‘European Common Debt: Is Defence Different?’:

Public financing is therefore essential to boost the EU’s defence capabilities. But in many member-states, it is unclear whether political consensus for raising defence budgets in inflation-adjusted terms will be sustained in the future. Voters are unlikely to support higher defence expenditures if these are perceived to come at the expense of higher taxes or lower spending on other priorities. Faced with these challenges, European policy-makers are looking for new financial instruments to enhance their defences. One proposal is the creation of EU defence bonds. Ever since the Union’s pandemic recovery fund made large-scale common EU borrowing a reality, policy-makers have often looked to such an instrument as a solution for a range of problems. But defence is exceptionally intertwined with member-states’ national sovereignty, and the EU’s role in defence is still embryonic.

And in these few lines, the interested reader may observe the crucial, if intertwined, realities of the EU’s pandemic response that is now said to allow, via what is commonly referred to as ‘mission creep’, application of ‘pandemic’-deriving measures in other contexts even though they fundamentally contradict the EU’s primary law.

Moreover, it is quite clear that voters will likely punish politicians if taxes are spent on arms instead of, say, social programs. In other words: while the thorny legal issues any such move entails will, likely, make it through the court system in the next couple of years, including the envisioned (ab)use of Article 173 TFEU; since this entire adventure shall be debt-financed, as opposed to using tax revenues, however, literally anything the EU Commission will do to establish a bloc-wide military-industrial cartel can, and will, be done via the functional equivalence of the Commerce Clause (which affords the US Congress the authority ‘to regulate Commerce with foreign Nations, and among the several States, and with the Indian Tribes’, as per Wikipedia, cited here to indicate common knowledge).

The key difference to the constitutional-republican provisions in the United States is that the EU Commission, via the to-be-created ‘Defence Industrial Readiness Board’, will hold these powers and not — Congress (the EU Commission, Council, or Parliament), which is yet another rabbit-hole that is explored in detail in [the next instalment].

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Bottom Lines

Funny that, eh? Imagine filing your (sic) tax declaration informing the powers-that-be of, say, your refusal to pay due to the apparent breaches of the law by the same powers-that-be. How fast you’d run into problems?

States are different beasts, and gov’t appears to consist of the worst of the worst, in terms of arrogance, wilful blindness, and multiple dependencies on outside (meant are individuals and institutions beyond the control of gov’t) sources for money, status, and recognition. Esp. the latter two are important as non-entities who would otherwise lead quite average (or below-average) lives are elevated over their fellow citizens to such degrees that both boggles their minds and addles their self-perception.

Yet, those who claim to govern (rule) over an apathetic citizenry stripped of almost all (natural) rights are, above all, neither perfect nor infallible; the current structure of governance, public and private, affords most politicos™ a proverbial ‘get out of jail free’ card, which further reinforces this meta problem.

It’s not merely about personal qualities (or lack thereof), such as honour, purpose, and integrity—but also about very much matters of governance and citizenship, such as accountability, responsibility (towards the body politic and every single citizen, incl. those yet too young to vote), and punishment for failure.

The latter may be found on a spectrum ranging from prosecution for criminal acts via (social) ostracism to public shaming. That’s how all human social organisations have worked since time immemorial, yet in our post-Cold War condition, it would appear that both public and private sectors have abolished all consequences for wrongdoing, that is, at least for the leadership class and its friends™.

So, we need to restore a modicum of honour and (public) shaming to the body politic, if only to instil, once again, a sense of self-respect for anyone who wishes to be a citizen, as opposed to a subject ruled by those who claim to be the better.

Finally, this doesn’t necessarily mean that we’d need to re-invent the wheel, proverbially speaking; it means that we, as self-respecting citizens, should insist that the laws that are on the books are enforced equally, and that, consequently, if a competent court finds misdeeds, punishment is meted out according to the deeds in equal measure.

And, of course, sic semper tyrannis.