Europe is arming itself

Despite the war rhetoric of top politicians, Europe has a problem: the population's willingness to fight is still lacking.

NATO Europeans fear Russia and Donald Trump. Rearmament is supposed to help against Russia. But money is scarce. In addition, the European arms industry is expensive and fragmented, unlike the Russian one. How will Europe become fit for war?

by Rüdiger Rauls

[This article posted on 8/21/2024 is translated from the German on the Internet, https://www.manova.news/artikel/europa-rustet-auf.]

Decisive for war

Wars are won through superior weapons or through the willingness of one of the two fighting parties to make sacrifices. During the Second World War, the Soviet Union was far inferior to the fascist invaders in terms of weaponry. The same applied to the Vietcong in the Vietnam War. Both made up for this technological inferiority through their peoples' great willingness to make sacrifices, because they knew what was at stake for them. The loss of life was correspondingly high.

The Soviet Union lost over 20 million citizens, Vietnam suffered more than 2 million deaths. Nevertheless, both were victorious over an economically and technically superior opponent. Supported by the political West, Israel was able to keep the Arab world at bay despite its relatively small population, but due to its economic and technical superiority. However, in the current conflict with the Palestinian population, this technical superiority is no longer enough. For almost a year now, Israel has been unable to break the resistance in the Palestinian territories.

Russia has an advantage in the war in Ukraine due to its high level of technology. The willingness to make sacrifices on both sides of the front hardly differed at the beginning of the war. In Ukraine, it has only waned since the now failed counter-offensive.

In contrast, the political West does not see itself in a position to wage a conventional war against Russia due to its people's lack of willingness to fight. The military, of all people, are warning against such an adventure.

They criticize a considerable lack of equipment and weapons production capacities in Europe. European weapons manufacturers hardly have any war-critical equipment. On the one hand, this is due to a lack of financial resources for armament on the desired scale, which must not be at the expense of social obligations. On the other hand, European arms production is still very fragmented along national lines and, in contrast to China and Russia, is largely in private hands.

This means that the manufacture of weapons and investment in new production capacities must be profitable for the owners of the arms manufacturers, otherwise they will not produce and invest. Love of country is not a basis for their decisions. It is the soldiers to whom the meat grinder of war is to be made palatable with the fight for higher things. They should risk their lives for their fatherland and values. The arms manufacturers, on the other hand, prefer dollars and euros as values.

Return, return, return

In order for arms companies to produce more and invest in additional production facilities, they expect the state to provide purchase guarantees or subsidies for the development of new weapons systems. Nothing happens before that. The largely nationally organized arms production in Europe has so far only allowed for small production volumes, because each state preferred the products of its own armaments manufacturers when equipping its own army.

When the war in Ukraine broke out, this nationally limited armaments policy in Europe showed its weaknesses as the need for military equipment increased.

“Because European capacities are limited, many member states covered their immediate needs in the United States, South Korea and other countries” (1).

Attempts to merge European defense companies had repeatedly failed due to wrangling over the division of a larger defense project among the participating companies and states. For this reason, the planned merger between the Leopard manufacturer KNDS, a merger between the German Kraus-Maffei-Wegmann (KMW) and the French arms manufacturer Nexter, and the Italian Leonardo Group recently collapsed. Despite attempts by the national governments to mediate, an agreement on the division of production was not reached.

The Italians demanded a higher share of the production value, which means nothing other than more profit. Every state armaments program has its limits when it comes to profit expectations. This is the disadvantage of a private-sector arms industry. If the return on investment is not right, Western values, the protection of the fatherland and even the Russian threat are meaningless. The top priority for owners and shareholders is the company's profit, everything else comes second. This is the decisive disadvantage of Western arms production compared to Russian and Chinese production.

They are not geared towards returns, which means that the financial interests of owners and investors do not have to be served in the pricing of weapons. That is why their production is cheaper and, above all, more productive. For 200,000 shells in the NATO standard 155 millimeter caliber, Germany recently had to pay over 6,500 euros each, plus additional costs until the shells are ready for use.

"In comparison, the average cost of a Russian 152 mm shell is around 1,000 US dollars (2).

This means that Russia can produce at least seven times as many shells at a comparable cost. This advantage cannot be quickly offset even by possibly more advanced Western production facilities. And the strategic advantage of artillery has been demonstrated once again, particularly in the Ukraine war.

European attempts at a solution

Europeans are responding to this strategically significant production and cost disadvantage by attempting to make the European arms industry more pan-European. The small states in the field of weapons production are to be broken up by creating large supranational armaments projects. The aim is to “counteract the fragmentation of the market and the multiplicity of systems” (3). The latest project is the creation of a European air defense shield, as “joint projects are needed to overcome the fragmentation of the European arms industry” (4).

However, this political interest, particularly on the part of the European NATO states, is also countered by the private interests of the arms companies. Many national arms manufacturers, such as the tank producers KNDS and Rheinmetall, are competitors within the European framework and on the global market.

When it comes to mergers, they do not want to let other manufacturers look at their cards when it comes to production processes, technical solutions and other competitive advantages.

“The tank project is one of a number of lame Franco-German armaments projects” (5) that fell victim to the self-interests of private enterprise and its profit expectations. This had even spilled over into the relationship between Germany and France. In Paris, people were disgruntled that “Germany was making purchases worth billions for its armed forces in the United States” (6). This involved the purchase of American F-35 fighter jets to the tune of around 10 billion euros. France would have preferred to see this sum invested in French Rafale aircraft.

In order to put an end to such national sensitivities, Commission President Ursula von der Leyen advocated a European defense union under the leadership of a Commissioner solely responsible for armaments issues before the European elections. This is because “standardization, joint production and procurement are tasks that can be solved better together in the EU than individually in the member states” (7).

However, here too, the private interests of manufacturers are the major hurdle that must be overcome. In order to make joint production palatable to the arms manufacturers in terms of a pan-European policy, lucrative offers are to be made to them. To this end, a new European legal framework is to be created, the so-called European Armaments Program.

More Europe

The aim of this project is to involve at least three EU states in joint armaments projects. To this end, the rules for awarding contracts are to be simplified and the regulations for arms exports eased. This is because more arms exports increase companies' production targets and therefore their profit prospects. Lower unit prices that can be achieved under these conditions improve the position of European arms manufacturers on the global market.

In addition, European subsidies and a reduction in VAT for the companies involved in joint projects beckon. The EU Commission also wants to support the restructuring of supply chains, which presumably means the outsourcing of Chinese products. A preferential regulation for military production is also to be introduced. This presumably refers to the promotion of such projects by the European Investment Bank (EIB), which was previously only allowed to promote civilian investments or, in exceptional cases, those with military-civilian use (dual-use).

The French Commissioner for Economic Development in the EU, Thierry Breton, who is still responsible for arms deals within the framework of the European Peace Fund, has already put forward a figure for the development of a pan-European arms industry. He would like to see a “fund endowed with 100 billion euros with which states could buy weapons on a large scale in Europe” (8), European weapons instead of non-EU weapons.

But even if the Europeans succeed in building up an efficient and therefore more competitive arms industry, this will not solve the core problem vis-à-vis their strategic opponents Russia and China: the willingness of their own population to fight.

The majority of Europeans do not want a war with Russia, and it is probably difficult to explain to them how they are threatened by Russia in the Baltic states or Ukraine.

Even if Western opinion makers never tire of painting the Russian threat on the wall, many people in the political West are aware that Russia had not moved a millimeter to the west by 2022. In contrast, NATO had moved ever closer to Russia's borders in several rounds of enlargement. It may be even more difficult to explain to both Europeans and Americans how they are threatened thousands of kilometers away in the South China Sea.

Sources and notes:

(1) Frankfurter Allgemeine Zeitung (FAZ) from March 6, 2024: How Europe's defense industry is to become stronger
(2) Ukrinform from 31.7.2024
(3) FAZ from March 6, 2024: How Europe's defense industry is to become stronger
(4) FAZ of 25 May 2025: Push for European missile defense
(5) FAZ from April 29, 2024: Armaments cooperation is not dead
(6) ibid.
(7) FAZ from February 24, 2024: Creating a defense union. Opinion piece by Ursula von der Leyen and Friedrich Merz
(8) FAZ from March 6, 2024: How Europe's defense industry should become stronger

Rüdiger Rauls, born in 1952, is a repro photographer and author of several books. The best known are “How does money work?”, “The future of socialism”, “Colony Group War” and “The development of early societies”. He runs the blog “Political Analysis - A materialist interpretation of world events”.