NATO used to be a relatively straightforward concept. For forty years, its single task was to defend a given stretch of territory against a given adversary with more or less the same strategy and set of military capabilities. The Alliance did not need to select its mission or choose from a range of contingencies to address. They were imposed on it from the outside and only became redundant when its adversaries—the Warsaw Pact and the Soviet Union—collapsed from within.

Since the fall of the Berlin Wall in 1989, NATO has faced an entirely different landscape. Defending territory has been less important than projecting stability and upholding allies’ security interests in the wider world. Today, the Alliance is potentially better known for what it does outside than inside Europe. As its post–Cold War missions in the Balkans, Afghanistan, and more recently Libya reveal, NATO has identified its own security with the well-being of distant countries, the great majority of which will never be NATO members. Rather than wait for threats to arrive at its borders, the Alliance has chosen to confront them at a strategic distance and via the stabilization of whole nations and societies.

In short, NATO has evolved from a defense into a security organization. Instead of one overriding mission, it now offers its members and partners a range of security services—from immediate protection to forging long-term cooperation. The positive side of this shift is that NATO no longer exposes itself to nuclear attack or existential danger in carrying out its security mission. The more negative aspect is that delivering security is much harder than delivering territorial defense. Instead of one strategy and one set of military responses, there are a myriad of options to choose from and a multitude of capabilities—military and civilian—that must be brought to bear.

Moreover, and unlike during the Cold War, NATO’s populations tend to focus more on the success of particular operations and the merits of the strategy than on the gravity of the threat. They are also much more mindful of the costs, in terms of human life and strain on national budgets. Whereas NATO governments and security policy elites see missions such as Afghanistan as “wars of necessity,” the public tends to view them more as “wars of choice.” For the average citizen, these threats only really exist if they are close to home and manifest themselves now rather than as future possibilities. At the same time, the Cold War created the impression among Europeans that they could have defense on the cheap; and this has been a hard habit to shake off, even as military forces have been used more and more.

The Cold War created the impression among Europeans that they could have defense on the cheap; and this has been a hard habit to shake off, even as military forces have been used more and more.

NATO thus faces a strategic dilemma. The absence of a sense of threat in Europe in recent times means a low priority has been accorded to defense and that armies and navies in many European allies are now smaller than at any time since the Napoleonic wars. Thus involving 450,000 soldiers in a counterinsurgency operation, as the French did in Algeria in the 1950s, would be impossible for Europeans today. Moreover, even more manpower would be needed today. Rapidly rising demographics throughout North Africa, the Middle East, and Southwest Asia mean that the allies would be hard pressed to match the 1:20 ratio of stabilization forces to population that France maintained in Algeria. And all of this manpower has to be dedicated to counterinsurgency operations that the RAND Corporation estimates last at least sixteen years, based on the historical average.

Using all its ingenuity, NATO has attempted to work around its declining resources and manpower shortages. The International Security Assistance Force in Afghanistan (ISAF) mission has been an effective proving ground to bring 28 allies and 22 non-NATO ISAF-participating nations up to the standard of modern combat operations. The Alliance has learned to work with the United Nations and its agencies on the ground and to integrate civilian priorities into its military tasks. It has learned to train and equip local forces and to exploit emerging technologies, such as drones and robotics, as force multipliers. It has also worked diplomatically to build cross-border partnerships in areas such as counternarcotics, intelligence, and border coordination, and to facilitate the provision of supplies and transit. The NATO armies of today may be far smaller than they were in 1989, but they are arguably much more battle hardened, versatile, and multifunctional.

Hence the paradox that as NATO learns its lessons, albeit often the hard way, and becomes a more experienced and effective peacekeeper, a combination of a lack of resources, of public support, and of conflicts suitable for NATO intervention may mean that the Alliance faces a declining market for its principal post–Cold War service: conducting multinational interventions. After 2014, NATO may find itself for the first time in twenty years without a major operation to run, or at the very least without operations being such a dominant part of its daily agenda. Many argue that NATO should get back to basics: concentrate on deterrence, Europe, and protecting the allies according to Article 5 of the NATO Treaty, which calls on all members to come to the defense of one. So, what is an alliance that has built its modern persona with big-budget operations like the Kosovo Force (KFOR) and ISAF to do?

Clearly, the Alliance must slim down, though it can do that without ignoring the global security agenda of its members. A smaller NATO can remain both politically and militarily engaged in world affairs if it simply undertakes some serious cost-benefit analysis. It could reduce its expenditures and still increase efficiency and rationality in the way it provides security. The Alliance should focus on ensuring the full participation and buy-in of its member states to increase burden sharing and the pooling of resources. Member states should strive to find unified positions, increase consultations with partner countries as well as industry leaders and state governments, and solidify existing and new partnerships. They should develop the capabilities to anticipate crises, and then prioritize and prepare for them.

NATO must demonstrate the capability to counter the twenty-first century’s security challenges.

Above all, NATO must demonstrate the capability to counter the twenty-first century’s security challenges. What will in the end be a more ambitious approach will help the Alliance confront today’s threats, such as cyber warfare, terrorism, and piracy.

What the Future Holds

Next year, NATO’s ISAF mission in Afghanistan will transform from a combat into a training and support mission, even if some units may still be involved in combat. In 2014, ISAF’s time in country will come to an end. NATO will almost certainly remain engaged in Afghanistan, training the Afghan security forces and carrying out a long-term partnership arrangement to assist in areas such as defense reform and military education. But NATO’s primary nation-building role, which at its height involved more than 150,000 troops from 50 countries deployed in Afghanistan, will belong to the past. Given widespread public disillusionment with large-scale military interventions on both sides of the Atlantic and rapidly declining defense budgets along with personnel and equipment cuts, it will be difficult for NATO governments to launch a mission of this sort again, even if they can muster the political will.

In Iraq, NATO has already terminated its training mission, which left the country at the end of 2011, and is looking toward the end of its KFOR deployment in Kosovo, even if the planned drawdown has been postponed because of recent tensions in the north. NATO’s Stabilization Force in Bosnia and Herzegovina (SFOR) was handed over to the European Union (EU) in 2004, and its naval mission in the Mediterranean, set up after the September 11, 2001, terrorist attacks against the United States, has been considerably reduced. Libya also represents a new departure in that, contrary to the experiences in Bosnia, Kosovo, and Afghanistan, an initial military combat intervention has not been followed by a NATO peacekeeping force on the ground. NATO may yet assist the new Libyan authorities in building a national security force from the current array of armed militias there, but a long-term stabilization force on the ground is almost certainly ruled out.

NATO could soon be an alliance without a major operation. Of course, it can always be argued that crises are inherently unpredictable and that interventions can come out of the blue. No one in 1989 or in 2000 would have credibly predicted NATO’s involvement in the former Yugoslavia or Afghanistan. If history is a guide, we should expect to be surprised. NATO’s military assets—command structures, interoperable forces, and planning capabilities—will undoubtedly be called on again sooner or later.

Yet, that said, the interventions of the future are unlikely to follow the patterns of the past. They are likely to be more spaced out and more focused on air and naval operations than on land deployments. The objectives are more likely to be limited and short-term, involving more intelligence gathering and special forces, to say nothing of the increased use of robotics and drones in place of soldiers. The missions of the future will also be more constrained by the need for international support and legitimacy (United Nations resolutions, the green light from neighbors, and the like) as well as by the diminished budgets and capabilities of NATO member states. Moreover, if Libya is to be the model for the future, not all the allies will decide to participate, particularly in the sharp end of the operation. The key to success will be to place the tried and tested NATO command structure, communications, and planning at the disposal of coalitions of the willing coming from both NATO and partner countries.

The 50/50 Challenge

Much of the Alliance’s integrated military structure has already been adapted to reflect the lessons learned from NATO’s previous operations and to make the structure more deployable and multi-service. The task now is to persuade all 28 allies to invest in the maintenance of this structure when it is not being used on a full-time basis, and particularly when it is being used by groups of allies and willing partners, and not necessarily the entire Alliance. Rather than the old mantra of “in together, out together,” solidarity will lie as much in the willingness to provide logistic and specialist support and common funding as in active participation.

A NATO without a major operation (or several operations being managed concurrently) will pose a major challenge for the Alliance. So much of NATO’s transformation since the end of the Cold War has been driven by the impact of operations or the need to do those operations better. Examples are the new command and force structures mentioned above, the new NATO cell for civil-military planning and coordination, and the extensive involvement of partners who have a full seat at the NATO table when they contribute forces to a NATO operation. Many of these partners have come into contact with NATO by sending forces to ISAF and without ever signing a formal Partnership for Peace–type of agreement with the Alliance. Afghanistan could thus mark both the beginning and the end of at least some of these associations across the continents. Other distinctive elements of today’s NATO have also grown up around operations: intelligence sharing focused mainly on areas where the Alliance has troops on the ground, regional expertise in NATO’s international civilian and military staffs, and NATO’s special envoys and representations in theater.

Even if operations do not feature as prominently on NATO’s agenda in the future, the Alliance cannot and should not relinquish the means to conduct those operations. NATO cannot change its roles and missions overnight. After twenty years of operations, the value it provides to its member states has increasingly been in its role as a command and planning structure to package and then manage multinational deployments. So that is what they will want and expect NATO to do in the future as well, notwithstanding a prolonged age of austerity that may well mean doing less with less. Maintaining multinational military headquarters and staffs as well as forces at high readiness is easier during major deployments than at a time of peace, when attention shifts to internal threats and budgets migrate toward police, border guards, domestic surveillance, and intelligence services.

Member states must find a way to preserve a standing-start NATO that has enough residual capability to initiate operations quickly, providing the first 50 percent of the effort.

Consequently, the immediate task for the Alliance could be described as the “50/50 challenge.” Member states must find a way to preserve a standing-start NATO that has enough residual capability to initiate operations quickly, providing the first 50 percent of the effort. The remaining 50 percent can then be added from national force structures according to the agreed-upon operational concept.

Of course, the Alliance must first determine what such a core NATO would look like by 2016, when the Alliance moves into its new Brussels headquarters. What core components should NATO maintain—the integrated command structure, the NATO Response Force, the integrated European air defense system, the missile defense system, the NATO computer incident and response center? Around these core components, NATO would need to develop clusters of capabilities in order to move quickly into an operation. Those clusters could include framework nations, national headquarters, mission focus groups, or clusters of allies providing niche capabilities, such as air transport, air refueling, precision-guided munitions, intelligence, reconnaissance and ground surveillance assets like drones, suppression of enemy air defenses, and all the other tangibles of modern war fighting that were highlighted by NATO’s recent campaign in Libya.

The Alliance must then find ways to incentivize its members to form these clusters of capability and equitably distribute the costs of using them on operations to the broader NATO community. Where is the balance between common capabilities, solidarity, and the flexibility to allow groups of countries to go it alone? How can NATO persuade those allies wedded to national sovereignty to accept pooling and sharing vital capabilities with the assurance that they will be available when that ally needs to use them? Creating political trust in the Alliance will be as important as solving the cost-sharing issues.

Deficiencies in Capability

NATO’s Operation Unified Protector in Libya exposed, once again, entrenched asymmetries between the United States and all other allies, especially in the conduct of intelligence-driven air operations. Most of these deficiencies were already evident during NATO’s Allied Force air campaign over Kosovo in 1999.

The United States now covers 75 percent of NATO defense budgets even if that does not mean in practice that 75 percent of NATO is a single ally. Meanwhile, the great majority of allies today allocate much less than NATO’s benchmark 2 percent of gross domestic product to defense. Only five allies (18 percent of the overall total) meet this benchmark. Only eight allies today have a full-spectrum force. The others increasingly provide niche capabilities. Recent reductions in European defense spending risk making dependence on the United States even greater. Moreover, budget and force structure reductions are happening without sufficient transparency or coordination among allies, or consultation with NATO itself. Those reductions are not following the capability targets (formerly force goals) that had been accepted by nations as part of NATO’s defense planning process.

The financial crisis should finally prod the allies into the more rational and costeffective use of their defense budgets.

This oversight needs to be adjusted to better track national defense plans and provide quicker assessments of the impact of national reductions on NATO’s deterrence and defense posture. Otherwise, opportunities for synergies, for more pooling and sharing, or for a rational division of labor may well be lost. There is a risk, as a result of cuts, that the Alliance could lose key capabilities, skills, and expertise, which could then take many years and enormous financial investments to regenerate.

And yet, even with the cuts, there is still enough money in the Alliance to fix these problems if there is the political will to do so. The EU alone spent €180 billion in total on defense in 2011, and the United States will still be spending more in this decade than the next ten countries combined. The United States is also coming down from a very high point, given that its defense expenditure almost doubled during the George W. Bush presidency. Taken together, Europe and North America account for over 50 percent of global defense spending. Europe is still ahead of Asia—although only slightly. So it is too easy and misleading to blame all of NATO’s capability shortfalls on budget constraints—real as they are.

If anything, the financial crisis should finally prod the allies into the more rational and cost-effective use of their defense budgets that has been discussed at NATO ministerials and conferences for decades. The NATO secretary general’s “Smart Defense” initiative, together with the EU’s “pooling and sharing” program, clearly point the way ahead, provided that NATO and the EU can also pool and share their own respective projects. There are hundreds of ways that allies can save money on defense by combining training, spare parts and support services, live-fire ranges, fuel and logistics supply chains, mobile medical units, maritime patrol aircraft and helicopter upgrades, and all the other innumerable things that modern armies need to go into battle.

NATO can no longer treat all missions as equal in importance, urgency, or probability.

“Smart Defense” is not just a one-time effort or a short list of “low hanging” projects tied to NATO’s Chicago Summit in May. Ideally, it is a multiyear, open-ended process that will transform NATO’s mind-set in handling capability development and procurement and achieve a clear sense of the balance between prioritization, specialization, and collaboration. Changing the working culture in Brussels and allied capitals will take more time and hard work, but agreeing on three “flagship projects” (missile defense, air-to-ground surveillance, and Baltic air policing) and an initial package of 20 to 30 new multinational programs to launch Smart Defense at the NATO Chicago Summit is a good start, provided that it is only a down payment on a much more radical overhaul of NATO’s role in handing capability development.

All Threats Are Not Created Equal

As budgets and capabilities decline, NATO will also need to reexamine its military planning assumptions. Currently it has a capability-based approach tailored to all the roles and missions it has given itself in its 2010 Strategic Concept. But NATO can no longer treat all missions as equal in importance, urgency, or probability. Its planning baseline no longer has the ability to deal with the worst-case scenario of having to carry out multiple large-scale and small-scale operations at the same time.

Prioritization may require shifting defense planning to a focus on potential military threats, latent or emerging, rather than on the broadest possible spectrum of military capabilities to insure against the unexpected. This means deciding where risks have to be accepted, and prioritizing forces to cover the most likely threats, such as the disruption of vital sea-lanes or the reconstitution of al-Qaeda terrorist networks, rather than primarily the most catastrophic ones, such as war between great powers or the massive use of weapons of mass destruction. These longer-term risks will need to be covered by reconstitution capabilities.

Consequently, the Alliance will need to scan the international environment more systematically and with more inputs from the intelligence community, net assessments, and policy planning. It will need to broaden and intensify its political consultations to better anticipate crises and to identify options for action at earlier stages of crisis management—and well short of full-scale military interventions. The analysis of the security environment has to be realistic and based on the world as it is, rather than how allies wish it to be.

Recent reforms in NATO, such as the establishment of an intelligence unit to fuse civilian and military inputs and of a strategic analysis capability, have given the allies the necessary crisis-prevention tools. But the political will must exist on both sides of the Atlantic to use them, and to share intelligence more regularly at both the strategic and tactical levels. It is easy to put the word “prevention” in summit communiqués; but NATO needs to think harder about what it means in practice and what levers the Alliance has to influence events around it, short of the default option of deploying military forces.

Reducing Reliance on the United States

As the United States pivots toward the Asia-Pacific region and withdraws two combat brigades from Germany, the future role of the United States in NATO will inevitably be discussed. But first, it is important not to exaggerate the changes. Even after withdrawing the two brigades, the United States will still have 37,000 troops in Europe, more than in any other place outside the United States itself, in addition to 28 bases. It has assigned one U.S.-based combat brigade to the NATO Response Force, which will return to Europe every year for training. However, as NATO’s armies move to a contingency posture, with greater reliance on reserves and territorial forces, maintaining interoperability between U.S. forces and those of the other allies will be an even more pressing challenge.

NATO will thus need to return to scenarios reminiscent of the Cold War in some respects: with plans for U.S. forces to return to Europe in a crisis situation honed through regular intensive exercises. The U.S. forces remaining in Europe must be configured to support this training. This would be helped if the United States left a disproportionate number of officers from all four U.S. services (Army, Navy, Air Force, and Marine Corps) at the key U.S. training facilities, such as Hohenfels and Grafenwoehr, or at NATO’s European headquarters. Some of these should be Article 5, collective defense exercises to provide reassurance to allies, particularly to those on the periphery of the Alliance where the conventional military balance remains unfavorable. Exercises also demonstrate NATO’s cohesion and resolve, having in themselves a deterrent value.

That said, the United States has made clear to the European Alliance members, and not only in the valedictory speech of former U.S. defense secretary Robert Gates, that it expects the Europeans to take the responsibility for security in Europe and on Europe’s periphery—barring an Article 5 contingency. It also expects Europe to take the lead in supporting the transitions that come out of the Arab Spring in North Africa and the Middle East.

An urgent challenge for the European allies will therefore be to determine how much they can rely (or think they can rely) on the United States in the future and how much they will need to rely on themselves. If, as Libya demonstrated, the United States restricts its participation in NATO to a supporting role, will the Europeans need to invest more in strike capabilities (such as combat aircraft and helicopters, missiles, precision-guided munitions, armed drones, special forces, and entry forces) while leaving the reconnaissance and surveillance or air-to-air refueling to the United States? Or should Europeans aim at complete autonomy to cover instances where the United States may not wish to be involved at all? This will mean that Europe duplicates some of the assets traditionally supplied by the United States. To some extent that is already happening—the EU is developing a Galileo satellite reconnaissance project, and the United Kingdom and France agreed to initiate a joint drone development program. Europeans have also started discussions on pooling their tanker aircraft, given that the United States had 1 per 6 strike aircraft over Libya and the Europeans had 1 per 26.

The other and probably wiser approach could be to use NATO to develop more common capabilities that draw on U.S. technologies (at attractive prices) and on some U.S. common funding to produce key enablers that will mainly be used by the Europeans—whether for NATO, EU, United Nations, or ad hoc operations. Examples of this approach are the NATO-led C17 consortium that leases three C17s from Boeing for the use of eleven allies and two partners on a time-share basis. Another is the Allied Ground Surveillance capability, which is based on the acquisition by thirteen allies of five Global Hawk drones and contributions in kind from the UK and France. A possible future initiative in this vein could be a NATO-EU tanker pooling and sharing program, with the resulting fleet available for EU Common Security and Defense Policy, NATO, or national missions, as needed.

Beware of Refocusing Only on Article 5

No matter how successful NATO becomes at getting more value out of its dwindling resources, one outcome seems relatively clear: the NATO of the future will have a smaller bureaucracy and be visible less frequently. If NATO is no longer on television every day, resulting from a mission such as ISAF, and much of its work is behind the scenes, the Alliance’s public diplomacy specialists will have to find novel ways of gaining public attention for its work. Indeed, in confronting many of the threats of the future, such as terrorism, organized crime, epidemics and pandemics, natural disasters, proliferation, and cyber attacks, NATO may well have a part to play and a contribution to make. But it is unlikely to be in the lead in the way that it has in its Balkan and Afghan interventions in recent decades.

Some will welcome this reduced focus. They have long been calling on NATO to “come home” and resume its traditional role as the guarantor of the borders and territory of its European members. During the debate around the Alliance’s new Strategic Concept, allies in Central and Eastern Europe pushed forcefully for Article 5 collective defense to be reaffirmed as NATO’s core mission. They sought to place reassurance in the form of contingency planning, regional headquarters, nuclear deterrence, the NATO Response Force, and Article 5 exercises at the top of the Alliance’s new list of roles and missions.

The subsequent debate on NATO’s Defense and Deterrence Posture Review (to be approved at the Chicago Summit) has underscored a similar reluctance to change NATO’s current level of tactical nuclear weapons in Europe as well as the burden-sharing arrangements for them until Russia agrees to reciprocal reductions and greatly enhanced transparency and confidence-building measures (such as relocating its weapons away from the borders of NATO’s eastern allies). Transitioning to more reliance on conventional forces will cost money, and budget cuts will reduce still further the scope for shifting NATO’s deterrence posture away from nuclear forces. (Though, of course, maintaining the nuclear forces is not without costs; if the requirement for nuclear weapons based in Europe is to continue, the B61 weapons and the dual-capable aircraft that carry these weapons will require modernization in due course.)

A NATO that returns to its pre-1989 role as an organization “waiting to be attacked” or existing primarily to maintain the military balance of power in Europe is hardly the best result for Western security nearly a quarter of a century after the fall of the Berlin Wall.

The number of difficult issues in the NATO-Russia relationship—whether they concern tactical nuclear weapons, exercises, military doctrines, Russia’s suspension of the Conventional Forces in Europe Treaty (CFE Treaty), missile defense, and enlargement to Georgia, not to mention the Libya campaign—is set to continue for the foreseeable future. NATO does not see Russia as a threat and views Moscow’s threatened countermeasures to the Alliance’s missile defense deployment as an unjustified waste of resources on Moscow’s part. But still, Russia’s ongoing military modernization (it will increase spending by over 50 percent in 2013, compared to 2010, and Vladimir Putin even announced a doubling of Russia’s defense budget during his recent presidential campaign) will provide fodder for those who argue for a more Eurocentric NATO, reorganized around its classic Article 5 function.

In many respects, it is difficult to contest this vision. Article 5, nuclear deterrence, and reassurance occupy a prominent place in NATO’s new Strategic Concept, and the contemporary political and financial climate is forcing the Alliance to “cut its coat according to its cloth.” But a NATO that returns to its pre-1989 role as an organization “waiting to be attacked” or existing primarily to maintain the military balance of power in Europe is hardly the best result for Western security nearly a quarter of a century after the fall of the Berlin Wall.

Such a posture will focus NATO and Russia on what divides them—military postures in Europe—rather than on the new global challenges, such as terrorism, proliferation, and piracy, where these interests often converge. It will also make future NATO enlargement more difficult and play into the hands of the old guard in Russia who still find it convenient to portray NATO as a rival or even as a threat. It will be easier for Russia to assert that NATO’s missile defense system is directed against its strategic deterrent rather than at proliferators such as Iran. This will in turn be used to justify Russia’s ongoing modernization of its own strategic nuclear forces, and the Defense Ministry in Moscow has already announced the building of 400 new intercontinental ballistic missiles and 8 new nuclear submarines.

The chance for a historic accommodation between NATO and Russia, which would bind Russia durably into the Euro-Atlantic security architecture for the first time since the nineteenth century, would be lost. Pressures on the countries of the former Soviet Union to integrate into Russian-led structures, such as the Collective Security Treaty Organization, could then intensify and lead to the emergence of new dividing lines in Europe. There is thus no real alternative to trying to achieve a strategic partnership with Russia, even if this is a long-term project. Certainly Russia’s military modernization program and recent electoral rhetoric regarding “foreign agents” trying to undermine Russia will make the NATO allies aware of the continuing need to balance Russian power. But it is important to do so without re-creating Cold War threat perceptions and mutual estrangement. Outstanding issues, such as the CFE Treaty on the stationing of conventional forces, exercises, and missile deployments, need to be negotiated and settled. It “takes two to tango” of course, but NATO must undertake every effort to avoid involuntarily becoming Russia’s pretext for a return to Soviet-style militarism.

NATO must undertake every effort to avoid involuntarily becoming Russia’s pretext for a return to Soviet-style militarism.

At the same time, the national security strategies of the NATO allies underline the extent to which they are currently preoccupied with regional crises, preventing global proliferation, dismantling terrorist networks, preserving their trade routes and access to raw materials, and integrating the rising global powers into a rules-based international system. If NATO is decreasingly responsive to this global agenda, or is focused only on contingencies requiring major military mobilization, such as those that Article 5 was traditionally intended to address, there is a risk of a disconnect between NATO-Brussels and the policy and resource decisions taken in NATO capitals or in other institutions like the EU.

Slimming Down and Staying Relevant

NATO’s core challenge for the next decade will be to slim down while retaining the capability to handle the global security agenda of its members. This is still possible, and NATO’s new Strategic Concept certainly provides the doctrinal basis. But words do not automatically lead to actions.

To succeed, the Alliance will need to be serious about three things: demonstrating real capability to counter the new security challenges; harmonizing allied positions on potential or actual regional crises; and binding the maximum number of its partners in North Africa, the Middle East, and the Asia-Pacific region into a structured security community through consultations, training, and interoperability. As NATO builds down, it will need to make sure that it does not sacrifice the structures and people that allow it to deliver on these three tasks and that make the Alliance more than just a multinational military headquarters for “when all else has failed” responses.

NATO’s future military effectiveness will be closely linked to its cyber-defense capabilities.

Because the new security challenges are often civilian in nature (90 percent of cyberspace is owned by the private sector) and because they are often managed by ministries of the interior, the police, or specialized government agencies, some have questioned NATO’s role and relevance. It is also not easy for an organization that has traditionally taken on the major role and responsibility in a crisis (Bosnia, Kosovo, Afghanistan, Libya) or has not been involved at all (Iraq, North Korea, Syria) to adapt to being a partial or supporting actor. There are a large number of agencies involved in a cyber, terrorism, or energy incident and the military role is only one of many that need to be brought into play, and with varying degrees of importance as the crisis develops. But because NATO cannot always be the complete solution does not mean that its role is symbolic, provided that the Alliance identifies the aspect of the issue that corresponds to its essentially military capabilities and crisis-management mechanisms.

Countering New Security Challenges

All future conflicts will have a cyber dimension, whether in stealing secrets and probing vulnerabilities to prepare for a military operation or in disabling crucial information and command and control networks of the adversary during the operation itself. Consequently, NATO’s future military effectiveness will be closely linked to its cyber-defense capabilities; in this respect, there is also much that NATO can do to help allies improve their cyber forensics, intrusion detection, firewalls, and procedures for handling an advanced persistent attack, such as that which affected Estonia in 2007.

The Alliance can also help to shape the future cyber environment by promoting information sharing and confidence-building measures among its partners and, in a longer-term perspective, other key actors, such as Brazil, China, and India. This is a field where the military is clearly ahead in many key technical areas. NATO already has one of the most capable computer incident response centers around and one of the best systems for exchanging and assessing intelligence on cyber threats. NATO must first establish its credibility in this area by bringing all of its civilian and military networks under centralized protection by the end of 2012, but it would not make sense to leave NATO’s role in cyber defense there. It can be a center of excellence for exercises, best practice, stress testing, and common standards for both allies and partners.

Of course, NATO will have work to do in order to be an effective player in the cyber field, along with other emerging threats. It will need to go beyond its traditional stakeholders in the allied foreign and defense ministries and build relationships with ministries of the interior, intelligence services, customs, and government crisis-management cells (such as COBRA in the United Kingdom). It will also need to step up its cooperation with industry (which is still in the lead for most of the analysis of cyber malware) and also with private security companies that will be playing an increasing role in cyber defense, protection of critical infrastructure, and protection of shipping from pirates.

This field is the very expression of security policy in the twenty-first century, in which industry will not just provide equipment but entire security management services to the armed forces. Private contractors will be firmly embedded in every level of defense ministries as well as the armed forces and security agencies. Many of the security functions traditionally performed by governments will be subcontracted to private companies—from physical protection to malware analysis, intelligence and early warning, and logistics. Accordingly, NATO must learn how to work more productively with them.

Given the exponential growth in malware and hacking skills, the cyber threat is the most pressing challenge; but there are others too that NATO can readily handle. For instance, using its Special Forces Headquarters at Allied Command Operations to train and set common standards for special forces with centralized air lift, or monitoring emerging technologies so that NATO can better exploit both existing and future disruptive technologies and counter the use of asymmetric methods by its adversaries. Yet another is the protection of critical infrastructure and supply lines for energy and raw materials, especially in the maritime domain where 90 percent of global trade takes place. Key choke points are especially vulnerable to piracy or threats of closure during crises and war. Related areas are the protection against chemical, biological, or radiological agents and training armed forces to cope with extreme weather conditions and natural disasters resulting from climate change.

The difference between these emerging challenges and what NATO encountered in the past is that they cannot be deterred. Cyber attacks, terrorism, supply shortages, and natural disasters will all occur. So a key new role of NATO is to help develop the societal resilience to cope with these new types of attacks, to plug vulnerabilities, and to build in the redundant back-up capabilities to allow societies to recover quickly.

But again, while NATO’s military organization and capabilities can be a useful first or second responder, they will need to be coordinated with domestic police, health, and emergency management agencies and organizations like the EU. So NATO’s progress in practically embracing the new challenges will depend upon its capacity for effective networking. This is where civilian-military exercises involving NATO and the EU, and NATO and the civilian crisis-management agencies, can help the Alliance to better prepare and understand the different structures and procedures used by its member nations.

Harmonizing Allied Positions

Another way for NATO to remain engaged in global security is to upgrade its political consultations and intelligence sharing. In recent times, NATO’s consultations have been too narrowly focused on the regions where the Alliance is leading an operation. Indeed, the public often thinks that security threats only exist in places where NATO has troops (and some people even believe that the threats exist because NATO deployed the troops). But the end of ISAF in 2014 should reduce the demands on the North Atlantic Council to direct operations and should free up time for more scanning of the horizon.

More time needs to be spent analyzing global trends and harmonizing allied assessments. More time needs to be spent crafting common NATO positions and locking in partners where possible. The recent common NATO-Russia position at the Biological and Toxin Weapons Review conference in Geneva is an excellent example of such a proactive political initiative even between partners that have their differences in other areas.

Winston Churchill famously said, “Gentlemen, we have run out of money. So now we must think.” Similarly, NATO will have to track potential threats at a much earlier stage and achieve a more sophisticated understanding of how hybrid threats are formed from the interconnection of trends such as terrorism, narcotics, or organized crime.

Such an analysis in NATO can also help its member states to identify the most cost-effective response to a given issue, which may not always be a military deployment. For instance, is piracy best solved at sea or on land? Are private guards on oil tankers more useful than warships in the Gulf of Aden? Is training Somali coast guard and customs personnel a better investment than financing pirate tribunals in Kenya or the Seychelles? Can improved maritime surveillance help to compensate for a small number of available ships? It is by having the capacity to do this kind of assessment and cost-benefit analysis that NATO will achieve better results, especially given that it is very difficult to reverse a military deployment once it has been committed.

NATO will have to track potential threats at a much earlier stage and achieve a more sophisticated understanding of how hybrid threats are formed from the interconnection of trends such as terrorism, narcotics, or organized crime.

The cost of military deployments can also outweigh the value of the strategic objective that is being pursued. For instance, in Afghanistan most of the counterinsurgency is carried out by a very small number of special forces rather than the bulk of the stabilization forces. Or take another example. Billions of dollars have been spent by the NATO militaries to deal with the few seconds when an improvised explosive device explodes in Afghanistan and with the resulting shockwaves against NATO troops and vehicles. But a different approach, such as the U.S. Operation Global Shield in which the U.S. military works with U.S. Customs and the Pakistani coast guard to interdict the illicit maritime transport of chemicals, including ammonium nitrate and hydrogen peroxide, only costs hundreds of thousands of dollars and can be much more effective. This is what the military calls “moving to the left of the bang”: identifying the networks of organized crime, technology, middlemen, and terrorists that produce threats, and using the military, police, customs, intelligence services, and scientific laboratories as a counter-network to disrupt these networks at their vulnerable points.

In the past, it was thought that consultation and analysis would inevitably commit NATO to act or create this perception among others. This assumption has often discouraged allies from discussing sensitive topics, such as Iran, North Korea, or the Middle East peace process. But the more NATO consults among its own members and brings in relevant partners as well, the less the outside world will expect action every time, and the more accustomed it will become to the Alliance being a political forum as well as a military power projector.

The NATO of the future should not build its raison d’être solely on the primacy of military action.

It is good that NATO is much more than a “talking shop.” But equally true is that NATO does not have to fire a shot to prove its value. The NATO of the future should not build its raison d’être solely on the primacy of military action, but equally on its ability to achieve political coherence among its members and to identify solutions that other branches of government and other organizations can then take up—even if this means that NATO will as often as not be in a supporting rather than a leading role.

Making Partnerships Permanent

Finally, a globally engaged NATO needs a strong and vibrant network of partnerships. Arguably, the Alliance’s greatest success story since the end of the Cold War has been its ability to attract so many other countries across the globe to support its operations and its broad political objectives. No other regional organization has such a global support and outreach network. Today, a non-Article-5 NATO operation without partner participation is almost unthinkable. And keeping these partnerships is NATO’s best insurance policy for promoting its cooperative and norms-based approach to security, at a time when the West is in relative decline.

Yet, maintaining solidarity and coherence among allies requires constant attention in this age of complex security challenges; this is even truer when the glue of Article 5 collective defense commitments is not present. Sustaining partnerships requires real-world practical tasks that further common security interests, as well as common or at least compatible value systems. Many of the Alliance’s partners have become involved in NATO through ISAF or the Balkans operations and have not, so far, concluded longer-term political agreements with NATO, such as the Partnership for Peace Framework Document. After 2014 there is a risk that this battle-hardened experience, including interoperability and common procedures, could be lost as nations take their forces home from Afghanistan.

A critical challenge for NATO will be to preserve these partnerships and redirect them toward new tasks, such as cyber defense or counterterrorism, or training and security sector reform to help other emerging security organizations like the African Union. Helping Afghanistan post-2014 to develop and finance its security forces would be a good place to start. Regular exchanges of intelligence and net assessments on new threats or crisis regions would be another. Once partner forces return home, NATO will need to think how it can preserve interoperability through joint exercises, simulations, contingency planning, and coordinated force planning. Partners are more likely to contribute to future NATO operations if they feel that they have been fully involved from the very beginning.

As countries like Australia or New Zealand do not have troops permanently deployed in Europe and it is very expensive to organize NATO exercises, especially on the other side of the world, the Alliance will need to show imagination in devising cost-effective solutions, for instance desktop or command-post exercises, virtual activities, or adding a NATO dimension to bilateral exercises (such as the U.S./Australia program). It would be useful if more partners that were ready to make a substantive contribution to the Alliance—whether politically or in capabilities, finance, and expertise—had liaison positions at NATO headquarters and in the strategic commands.

Certainly, NATO has given itself the structures to develop these partnerships. It has introduced more flexible 28 (all allies) + N (interested partners) formats, as well as a single toolbox of activities to give partners more cooperation options. It has also begun to widen the scope of consultations beyond Afghanistan to include counter-piracy and cyber defense. But if these relations are to go forward, the Alliance will need to square one or two circles.

First, partners will be all the more prepared to take an interest in NATO affairs if NATO shows an interest in their regions and security problems. But the Alliance must consider how to broaden its horizons when the pressure of budget cuts is pushing it “back to basics” and refocusing attention on Europe. NATO must also think about what it can offer—in terms of a security model, confidence-building measures, exercises, or training—to be of relevance to the situations in the Middle East, North Africa, the Caucasus and Central Asia, and the Asia-Pacific.

Second, if NATO pursues closer cooperation with the more willing and able or more like-minded partners, it should consider how it can avoid creating the impression of a hierarchy of partners, whereby some engage but others disengage or feel neglected. Forming partnerships is also about building bridges with those entities that are not like-minded or those that have been critical of the Alliance (such as Russia, India, China, Brazil, and South Africa during the Libyan operation).

Building trust and legitimacy with these new key actors in a multipolar (or merely nonpolar) world will not be easy, as they too seek to more actively promote their interests and increase their defense spending. Over the past ten years, Russia has increased its defense spending by 368 percent, China by 335 percent, and India by 183 percent. In a few years, China will be the world’s biggest economy—the first time in two hundred years that a nondemocratic state will hold that title, and the first time in five hundred years that a non-Western state will. Yet the BRICs are not a bloc and there are opportunities for cooperation (such as with China on piracy, with Russia on terrorism and Afghanistan, or with India on maritime surveillance and post-2014 Afghanistan) that NATO will need to keep in mind.

Smart Planning and Smart Thinking

In an age of austerity, it will be tempting for the allies to walk back from the ambitious goals in the new Strategic Concept and to return to more traditional notions of European territorial defense and deterrence. After more than sixty years of existence, NATO maintains enough infrastructure in Europe to keep the peace. Even if these structures are smaller and more hollow, they will still be enough to deter any state-level adversary for many years to come. European territory, at least, is secure.

By adding “smart planning and smart thinking” to “smart defense,” NATO can best survive the age of austerity intact and be ready for the world that awaits beyond it.

“Back to basics” might strike some as the most realistic approach, and the best balance between missions and severely constrained resources. But NATO leaders and policymakers should ask themselves if this future of a “leaner NATO with a lighter footprint” is either inevitable or desirable. As this article has argued, there are many cost-effective ways to keep even a smaller NATO engaged as a player, both politically and militarily, in global affairs. It can do a better job of harmonizing transatlantic positions in crisis situations, be the hub of multinational, high-end military operations, and develop expertise and capabilities to deal with new threats such as cyber attacks.

This more ambitious approach will keep NATO relevant for much longer into the twenty-first century than the hunker-down-in-Europe alternative. It is also a much better basis for continued U.S. and Canadian engagement in the Alliance, even if U.S. Secretary of State Hillary Clinton and Secretary of Defense Leon Panetta have recently reassured the European allies that the pivot toward Asia has not diminished the importance of NATO.

But in this age, nothing can be taken for granted, nor can anyone afford to be complacent. By adding “smart planning and smart thinking” to “smart defense,” NATO can best survive the age of austerity intact and be ready for the world that awaits beyond it.

Jamie Shea is NATO’s deputy assistant secretary general for Emerging Security Challenges. This article is the personal opinion of the author and does not reflect an official view of NATO.