The long-delayed Defence Investment Plan is finally (almost, maybe) here, though not before claiming the resignation of Defence Secretary John Healey over its funding settlement.

If reporting is to be believed, it has been funded by raiding capital budgets across Whitehall. This, unfortunately, is one of the worst ways to fill the gap. It pays for our defence today by endangering our security tomorrow.

Defence is not just the technology and weaponry needed to go into combat, but the broader resilience of our economy and society. Decades of underinvestment in energy, infrastructure, and public services have left our country vulnerable to external pressures and shocks, and our people disenchanted and divided. By raiding the budgets intended for projects that would reverse the damage, we only increase our insecurity.

Over the last few weeks, two debates have emerged: one about how we fund our defence in a new era of geopolitical challenge, and the other about how we revive our dysfunctional economy. These two debates are happening independently of each other, but they shouldn’t be: in fact, they are indivisible.

In this edition of Signals, Future Statecraft’s regular roundup briefing on foreign policy, defence, and international power, we’ll explore how that connection plays out and why it matters.

Andrew Noakes, Future Statecraft

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One of the ultimate goals of defence is to protect British sovereignty, but in this era of weaponised interdependence, our sovereignty is as much endangered by energy insecurity, technological dependency, and the outsized role of foreign capital in our economy as it is by Russian aggression. Writing in the New Statesman, Mathew Lawrence argues that the vision of a Productive State combines economic transformation with geopolitical advantage:

The Productive State delivers sovereignty advantages that markets systematically underweight and that the current geopolitical moment makes newly urgent. Price sovereignty: the ability to insulate domestic households and firms from the transmission of global market shocks into bills and input costs. Supply chain sovereignty: maintaining domestic productive capacity for the equipment, components, and materials on which the energy transition depends, rather than trading one geopolitical dependency (imported fossil fuels) for another in the form of imported clean tech goods and capital. And ownership sovereignty: ensuring that essential infrastructure is not progressively acquired by owners whose interests lie elsewhere.

While some argue that new institutional models can unlock greater investment within existing fiscal constraints, others believe the constraints themselves need reform. Writing in Renewal, Louise Haigh MP argues for fiscal reform that would underpin long term public investment in the British economy, putting an end to the short termism that has held back growth:

The current fiscal framework is unfit for purpose and unable to deliver the economic renewal we in the Labour Party believe our country needs. The status quo is not a neutral baseline – it is a path to continued stagnation. Longer time horizons, new and better empowered institutions, and a greater investment capacity for those parts of the state that already exist should be the building blocks of a credible growth plan that would in turn buy us trust from the markets.

Funding public investment without spooking the bond markets will be a delicate balancing act. In Arguably, reminds us that market scepticism about Britain is itself a drain on our resources and a source of insecurity. Restoring confidence, he argues, means getting serious about spending reform, starting with the triple lock:

The persistence of the “triple lock” on the state pension, as the IMF notes in its latest verdict on the UK, is perhaps the best example. In a country in which three million people aged over 65 now live in millionaire households, we have persisted with an extravagantly untargeted policy. Moving to a measure based on the average of inflation and wage growth, the Intergenerational Foundation estimates, would save £19bn a year by 2035, £28.5bn a year by 2040 and £38bn a year by 2045.

Addressing the dysfunction in our political economy, particularly with respect to the triple lock, is part of this puzzle. But changes must be targeted to avoid a broad return to austerity, otherwise we risk undermining the economic security we’re trying to create, which in turn undermines our defence. As Clive Lewis MP warns in Byline Times, people will not defend a country they have no stake in:

The familiar framing, that social spending is what must be sacrificed to meet the NATO target, is not merely politically toxic. It is strategically illiterate. Cutting the foundations of social cohesion to fund the hardware of national defence is self-defeating. You end up with planes and no pilots, submarines and no crew, an army that cannot recruit because the society it is meant to protect has stopped believing in itself.

This runs to the heart of the connection between economic transformation and defence. Public investment is not just a national or abstract need, but a human one. As Al Carns, (now former) Minister for the Armed Forces, argues in the New Statesman, a strong defence requires a strong country, which requires resilience all the way down to the individual:

We often talk about defence, the economy, the NHS, education and energy as if they are separate conversations. They aren’t. You can spend billions on defence, but if families are struggling and the economy is under strain, you are kidding yourself about how strong this country really is. If families are one bill away from trouble, the country is not stable.

The other side of this coin is that increased defence spending must have public support, which is where political difficulties arise. As Evie Aspinall writes, the public are reluctant to accept trade-offs:

So while Britons broadly support increasing defence spending, our research consistently shows that they are unwilling to make the necessary trade offs, either in the form of cuts to welfare, health or education, or through increases to their taxes to fund it. That puts our democratically accountable leaders in a tough position. They have very little fiscal or political headroom. Certainly not enough to fund the vast and rapid increases in defence spending that military leaders would like to see.

This conversation has an international dimension too. Strengthening British security, sovereignty, and economic power means developing partnerships with likeminded countries on defence, energy, and technology in a way that multiplies power without locking in dependence. IPPR’s recent report on diversifying diplomacy suggests a way forward:

Weaponised interdependence has become the hallmark of 21st century statecraft, posing as yet unanswered questions for the state’s approach to delivering prosperity and security.

Britain should respond decisively. First, it should identify chokepoints in a small number of ‘core’ domains that underpin long-term security and productive capacity – we suggest defence, energy and AI. Second, it should identify and build new partnerships that mitigate these vulnerabilities and deepen areas of UK comparative advantage.

As the transatlantic alliance falters and Britain’s future in Europe remains an open question, Britain could look to fellow middle powers for such partnerships. The New Diplomacy Project proposes a new ‘trusted six’ format:

The T6 is a proposed grouping of established middle powers – the UK, Japan, South Korea, Canada, Australia, and New Zealand. These states share many features including democratic governance systems, advanced economies, and a track record of engaging with the EU across many fronts… In the T6 model, this grouping could negotiate on a collective basis with the EU to co-create partnerships that bolster the economic security and resilience of all.

These proposals suggest a third interrelated debate is needed: on Britain’s place in the world. As writes, the current Labour leadership shadow contest has ignited a welcome debate on the economy, but it’s quiet about geopolitics. Yet the latter is just as important to Britain’s future:

Anyone currently inside the system, or frankly outside it, knows the world is changing fast and we have very real choices to make. That’s why Labour also needs a proper debate on foreign policy. So what are the choices Labour’s leaders need to address? Anyone seeking to be Prime Minister needs a clear answer to these four sets of questions on China, the United States, Europe and the Middle Powers, and to be able to explain how these all add up into a strategy.

Whatever path we choose, Britain won’t have credibility with allies in the future if it can’t follow through on the commitments we’ve already made. writes that the failure to produce a properly funded Defence Investment Plan leaves Britain’s defence in disarray, and our credibility with partners undermined:

The Prime Minister of Japan is visiting this week, and GCAP is likely to be high on the agenda. The Japanese have been very patient but increasingly infuriated by the UK’s prevarications and refusal to commit spending to this critical defence project. Furthermore, if Starmer can’t get the Defence Investment Plan over the line by the NATO Summit in Ankara in July, or the investment is unsatisfactory, Britain’s reliability as an ally within Europe is going to be heavily questioned.

Britain’s defence debate traditionally revolves around percentages of GDP and procurement plans, and as the DIP debacle shows, those things matter. Yet the deeper question is whether we can build and sustain the economic foundations – and the international partnerships – that make defence durable. Security, growth, and sovereignty are not competing priorities. In the years ahead, they will succeed or fail together.

P.S. These themes are explored further in my recent essay, Breaking the Rules for Defence, which proposes a British Autonomy Bond – a national investment vehicle designed to fund projects, programmes, and technologies that will contribute to British autonomy. Part financial instrument, part political mobilisation tool, it draws on a framework that sees defence and economic security as indivisible and aims to mobilise public support and capital for both.

Defence spending in Britain is stuck. The Defence Investment Plan is now over six months late, prompting the normally constrained establishment figure Lord Robertson to publicly accuse the government of ‘corrosive complacency’.

Britain’s defence capabilities are creaking, but the government can’t agree on how to pay for the overhaul that’s badly needed. The working public won’t accept another tax rise, the public at large won’t consent to spending cuts, and then there are the fiscal rules.

Enter Andy Burnham, who argued in an interview last week that ‘There’s certainly a case, when we look at the pressure on defence spending, to consider that exceptionally outside of the [fiscal] rules’.

This is a welcome intervention. The urgency of the threat, the scale and nature of the investment we need, and the political environment all converge on borrowing as the most plausible solution. But we need to be clear-eyed about the problem borrowing solves – and the one it doesn’t – and how it ought to be packaged to achieve both public consent and market credibility.

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The problem defence borrowing solves – and the one it doesn’t

Defence suffers from chronic under-funding with respect to both capital and resource spending. Both are needed, but borrowing only solves the first cleanly.

Capital costs are one-off or time limited, like building new factories, expanding munitions stockpiles, building ships and submarines, and so on. They don’t continue in perpetuity, which means you don’t have to keep borrowing in order to sustain them (there is a caveat to this – more on that in a moment). Some of them may even pay back their costs over time – and then some.

Resource spending is the opposite. It’s ongoing and open ended, such as paying soldiers’ salaries, maintaining military accommodation, and repairing equipment. Borrowing for this sort of spending is more likely to spook markets that are worried about unbounded liabilities.

So, borrowing solves the capital problem but not the resource problem. Unfortunately, it’s not enough just to solve one of them. And here’s the fly in the ointment: if you solve the capital problem too well, you’ll generate significant additional resource costs. New warships need maintaining, new aircraft need fuel, and new weapons systems need soldiers to operate them. And here lies the caveat I mentioned above. You can end up creating a resource cost-borrowing spiral even if you set out to only borrow for capital spending.

In defence of military Keynesianism

This is where investment returns start to matter. If more resource spending is also needed alongside capital spending, the government needs a way of meeting higher ongoing costs. Which would seem to bring us back to our starting point: taxation and spending cuts.

I won’t pretend that borrowing allows us to escape this dilemma completely, nor should it. There are questions of political economy that the country must reckon with, from reforming the triple lock on pensions to taxing wealth more effectively. Nonetheless, the best answer for meeting higher resource costs, whether it’s for defence or in other areas, is economic growth. For that, you need long term investment that produces returns.

Here’s where things get interesting, but contentious. Capital spending for defence – funded by borrowing – could produce returns that not only recoup the original cost but produce a net gain for the economy that, over time, allows us to fund higher resource costs too.

Renewed interest in this sort of military Keynesianism has attracted some criticism. The most powerful argument is that while defence investment may end up paying for itself over time, there is an opportunity cost associated with prioritising it over more productive infrastructure investment. It’s worth interrogating this criticism more closely. Much of it rests on comparisons of short-term fiscal multipliers – how much immediate economic activity is generated per pound spent. By that measure, defence often underperforms infrastructure or public services. But this shouldn’t be the only metric.

What it misses are the dual-use spillover effects that are hard to quantify. Defence spending has created or accelerated some of the most transformational technologies of the modern era. Jet engines took off in WW2 and went on to underpin the entire modern air transportation industry. The Manhattan Project gave us the atom bomb but also nuclear power. Codebreaking drove early advances in computing. The internet started as ARPANET, a project of the US Department of Defense. Defence spending has a habit of concentrating investment in technologies that would be too high risk for ordinary investment but which end up producing enormous returns for the civilian economy. Opportunity cost runs both ways.

Defence spending also underpins strategic industries, such as aerospace, shipbuilding, secure digital communications, energetics, and precision manufacturing reliably and at scale. Unlike many other targets for investment, these industries tend to involve long-term procurement cycles, deep domestic supply chains, geographically rooted production, and high-skill technical work that is difficult to offshore. More investment in these areas can therefore turn them into a durable pillar of re-industrialisation, bringing jobs, skills, and growth to communities that need them. This could be particularly powerful when combined with devolved regional growth strategies, with defence industries underpinning regional clusters that integrate local universities, technical colleges, apprenticeships, and supply chains into long-term employment ecosystems.

From defence spending to autonomy

The most interesting part of this debate, though, is what we mean by defence spending in the first place. The central insight of many security analysts and commentators on the left is that defence is much broader than its military dimension. It should, they argue, include the threat from climate and ecological breakdown, as well as upstream conflict prevention and efforts to tackle global poverty and disease – an approach often called human security.

The problem is that this often, fairly or unfairly, comes across as a political sleight of hand designed to elide hard power from the conversation altogether, which naturally raises the suspicions of defence hawks. But this is a missed opportunity. The truth is that placing traditional defence spending within a broader envelope would enable us to build a wider coalition in support of it.

The question is, what envelope? The key concept here is not human security, but autonomy. People in Britain are weary of having their lives upended by things beyond their control: markets crashing, pandemics raging, energy prices skyrocketing, wars breaking out. The defining slogan of Brexit, ‘take back control’, was so effective because it spoke to a deep desire that has increasingly been frustrated in our highly globalised, interdependent world – the ability to influence our own fortunes.

Whereas traditional approaches to defence and the human security approach occupy opposite poles, autonomy provides a meaningful overlap between the two. It does not elide the military dimension – in fact, traditional defence is at its core – but it also encompasses energy security, technological sovereignty, strategic infrastructure, and national resilience. These pillars translate into military rearmament, nuclear power, and data centre construction, just as much as decarbonisation, energy affordability, and pandemic preparedness.

Not everyone will be convinced. Some defence hawks won’t want to broaden and share their lane. Some on the left will find it difficult to accept military spending at all. But for the moderates on either side, there is an opening now for a meeting in the middle that has not been available before – an opening created by Donald Trump.

If autonomy gives us the framing, then Trump has given us the impetus. Britain’s military dependence on the US has emerged as a dangerous vulnerability in the age of America First. Those on the left who have long viewed the US with suspicion now find some common cause with disillusioned Atlanticists who are looking again at deeper European cooperation, as well as a new Anglo-Gaullism. The concept of autonomy is the glue that can hold them together.

A British Autonomy Bond

How to operationalise autonomy? What I propose is a British Autonomy Bond: a national investment vehicle designed to fund projects, programmes, and technologies that will contribute to British autonomy. This would include spending on defence and defence-industrial capacity, but also on nuclear and renewable energy, strategic infrastructure, AI and advanced computing, biosecurity, and other areas vital to national resilience.

The bond must have credibility with the markets. For this reason, it should be restricted to long-term capital investment, rather than resource spending, with independent governance and oversight mechanisms designed to ensure it stays tightly defined and on mission. It could aim to raise as much as £100 billion over a 10–15 year period, which would track well with the longer timeframes needed for the kind of projects it would fund. A longer timeframe would also avoid overheating the economy, allowing time for capacity to scale up.

For the defence component, funding should be tied to procurement reform (I recommend this excellent report by for if you want to know how this could be done). The markets – and the public – must be confident the money will be spent prudently after years of mismanagement. It should also include funding for local and regional authorities to invest in education, skills, and infrastructure to sustain new industrial clusters.

The bond should be made as attractive as possible to domestic pension funds, which sit on vast amounts of under-utilised capital. Fund managers must not be asked to abandon their fiduciary duty. Through the bond, the state absorbs the risk, while pension funds benefit from stable, long-duration investment returns.

The bond should also be available to members of the public, potentially as a National Savings and Investments product. In the more ambitious version of this idea, the public could be given a choice over what sort of projects they want to fund and in what regions, turning it from a financing instrument into a vehicle for public mobilisation and participation – part of that ‘whole of society conversation’ that has so far been missing.

This isn’t just about defence spending and the fiscal rules. It’s about rebuilding legitimacy for strategic state capacity in an era of fragmentation and insecurity. After decades in which the British state has struggled to think long term, build at scale, or shield the public from systemic shocks, autonomy offers a way of reconnecting national resilience with democratic consent. A British Autonomy Bond could provide the political and financial architecture through which we begin to do that.

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NATO is functionally broken. If its core rationale and value is to bind the United States to European security, that purpose has now unravelled. Trump has said US withdrawal is ‘beyond reconsideration’, after European countries declined his exhortations to step into the firing line in the Strait of Hormuz. On Wednesday, the White House said NATO has been ‘tested and they failed’.

On paper, NATO will likely limp on. Trump cannot formally withdraw without congressional approval, which he won’t get. But he does not need to. As commander-in-chief, he will decide whether or not to come to Europe’s aid if Article 5 is invoked.

The message is clear: if you’re not here for us, we won’t be there for you.

That message will have been received in Moscow, where Putin will now be eyeing opportunities to take advantage before the end of Trump’s term. Has it also been received in European capitals?

Andrew Noakes – Future Statecraft

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If NATO is no longer a reliable guarantee of security, Britain cannot escape its predicament with technocratic tweaking. In De Gaulle or Nothing, invites us to imagine a path that matches the historical moment – one rooted in a new Anglo-Gaullism:

“The magic of Gaullism was that it masked retreat with a determined effort to boost national morale. France might no longer be an empire, but she was entering a promising new future. And the genius of de Gaulle was to re-enchant through storytelling a nation that had utterly lost confidence in itself.”

A crucial pillar of strategic autonomy will be greater alignment with Europe on security. Writing in LabourList, Philippe Lefevre argues that Britain could go much further in forging a stronger security relationship with Europe:

“Our boldness on Ukraine is to be commended and continued, but it must be matched with equal boldness with our other European Allies, with clear areas of engagement. Whether this be by following the example of French Nuclear confidence or by finally joining the EU’s Defence SAFE programme (it having been an embarrassing mistake to have missed our previous chance), there are a myriad of ways in which Europe is rising to the challenge which we should also be meeting.”

Europe’s economic dependence on the US is no longer a convenience but a strategic vulnerability. In Europe’s escape plan from Trump’s chaos machine, addresses one of the linchpins of US economic hegemony – the US dollar – and presents an opportunity for Europe to build its own financial power.

“It is one thing for the European financial system to rely on US bonds as their safest asset in peacetime. It is another altogether when the US is slapping tariffs on our goods, undermining our democracies and recklessly destabilising the global energy market.

So the time has come for European countries – ourselves included – to consider creating a massive, common debt instrument.”

Control over compute is becoming a question of state power. In Data Centres and the Politics of Scarcity, argues that left-populist critiques of data centres miss their growing importance as sovereignty enablers:

“As the alternative to building sovereign compute infrastructure is not some pastoral Britain untouched by AI. It is a Britain that runs its public services, its health system, its defence systems, and its economy on infrastructure hosted elsewhere, owned by others, and subject to decisions made in boardrooms and capitals over which we have no democratic say whatsoever.”

There is a gulf between the public perception of Britain’s military power and the reality. In Britain can no longer fight a major War in Europe, reminds us how much of a climb it will be to catch back up:

“The British Army has its work cut out for it. If it aims to restore its capabilities from the late Cold War, the force would have to grow considerably, a large pool of reservists would have to be established, and a sufficient military industrial base would have to be rebuilt to enable a highly intense war alongside NATO allies.”

Military capability is only one side of deterrence; the other is political will. In Who would fight for Britain?, shows us how this is being undermined both on the right and the left:

“There is a certain irony in the fact that those on right and left who draw, respectively, on Churchillian ‘finest hour’ rhetoric or anti-fascist cliché for propaganda purposes, are much less interested in facing down a despotic ruler in the here and now.”

The question is no longer whether the transatlantic system as we know it can be preserved, but whether we can build a credible strategy for what comes next. The direction is becoming clearer, but Britain is only beginning to grasp the scale of the adjustment required.

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In the weeks since Keir Starmer’s speech to the Munich Security Conference, my mind keeps returning to two ignominious episodes in British history: the Suez Crisis and the Iraq War. Suez taught us the danger of acting – and thinking – independently. Iraq taught us to be sceptical of our capacity and our motivations on the world stage. In their combined shadow, we can trace the outline of Britain’s strategic drift today, so perfectly encapsulated in that Munich speech.

If you expect me to excoriate the prime minister and his team, then you misread me. For his task is not only to grapple with the unravelling of the transatlantic alliance just at the moment it is most needed, but to respond by shaking off the spectres of both Suez and Iraq simultaneously. The constraints are not just born of capability deficits and alliance politics, but embedded deep within the institutional psychology of the British state, and beyond it, the nation as a whole. Breaking free of that requires a deeper reckoning.

The prime minister’s Munich speech was in fact a welcome upgrade to the usual continuity rhetoric. He rightly called for Britain to play a pivotal role in a more European NATO, to end capability duplication through European cooperation, and for faster rearmament. He acknowledged US disengagement, even if the transatlantic alliance was still cast as indispensable, and the real prospect of a wider war in Europe. All of this is important.

But it is one step behind the real conversation Britain needs to be having. And the distance between these two conversations is creating an ever-widening strategic gap in British foreign policy.

That gap is threefold: between rhetoric and action, between the British reading of the transatlantic alliance and the reality, and between the leadership role now demanded of Britain and the more passive role it is stuck playing.

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How we arrived here

When Anthony Eden embarked on the ill-fated Suez intervention, and Tony Blair on the Iraq War half a century later, neither would have foreseen the long-term strategic consequences. For Eden, Suez was about Britain protecting its economic interests and exercising its role as a primary global post-war power. For Blair, Iraq was about Britain fulfilling its role as a key US ally and junior guarantor of the liberal world order. Both would have felt the winds of power behind them.

But as Eden helplessly watched the Bank of England’s reserves deplete in response to the crisis, forcing him to succumb to US pressure to withdraw from Suez in humiliation, he must have sensed the sands shifting. So too for Blair as he watched the legal and moral case for the Iraq War unravel and a catalogue of setbacks and maladies emerge.

Suez and Iraq did not alone create our present predicament, but both have had an outsized influence in shaping the confines of our strategic culture and conditioning the response. Suez put a crack in the façade of British power, and from that moment the mirror Britain held to itself became ever more fragile. We came to rely upon the special relationship not just to break the fall of our declining power but to cushion our self-image, too. Iraq, then, was both symptom and accelerant. Separation from the US was by then hard to imagine, but the war smashed what remained of Britain’s strategic confidence – and our moral confidence too. Only the glue of American power and friendship could now keep Britain’s brittle strategic culture intact in the new century – a conclusion solidified by Brexit, which tragically undermined Britain’s primary alternative path.

Now America under Trump has done what Britain was never prepared to do – let the mirror shatter, and the pieces fall. The Greenland Crisis exposed the precariousness of binding British statecraft ever tighter to the fortunes of the special relationship. It is now up to Keir Starmer to do what successive prime ministers before him have refused to countenance – pick up the pieces and put them back together in a new configuration.

But the task is immense. British foreign policy is shackled within interlocking layers of constraint. At the top there is deep psychological dependence on Washington and atrophied strategic imagination, leading to the narrowing of options because the lens itself is narrow, not the options. This is only reinforced by the institutional caution of the British state, naturally inclined to anchor Britain’s response in strategic orthodoxy.

Next comes the danger from Russia – the most urgent security threat Britain faces. If ever the transatlantic alliance were needed, it is now. This makes it much easier to dismiss a policy of autonomy from Washington as reckless, even as Washington itself makes territorial claims on Britain’s European allies and proves indifferent to Russian aggression.

Connected to this is public unease about the cost of rearmament – vital both for seeing off the threat from Russia and for reducing dependence on the US. As the British Foreign Policy Group’s 2025 annual survey of the public revealed, 71% of Britons support increasing defence spending to 3% of GDP in principle, but that support collapses to just 37% if tax increases are required and 22% if it means reducing NHS spending. This shows little appetite for the trade-offs. The prime minister is rightly concerned, as he said in Munich, that ‘the peddlers of easy answers are ready on the extremes of left and right’ if costs are imposed on the British public without winning the argument first.

The final layer of constraint is material. The 2025 Strategic Defence Review boasted that ‘technology collaboration [with the US] is already unmatched, with the UK participating in more US‑led technology projects for military advantage than any other country.’ This is one way of saying our defence capabilities are dangerously dependent on the US. There is no greater example of this than our nuclear deterrent, but the F-35 is just as compromised, and our dependence on the US for strategic enablers is well known. Defence cooperation isn’t the only problematic area. Britain is equally dependent on the US for the technology that underpins our economy, including operating systems, cloud computing, payment infrastructure, and AI.

Faced with all of this, the temptation is to search among the shattered fragments of the transatlantic alliance for a shard or two that still casts the special relationship in a favourable light: Trump’s personal affinity for Britain and the prime minister, our ‘superior’ deal on tariffs, the fact that an American takeover of Greenland was averted – for now. We can try and package it up to convince ourselves all will be well – that a departure from the status quo is unnecessary, even if in reality the status quo has long since left the station.

To give him due credit, that is not what the prime minister is doing. But he is torn between the two positions – rupture on the one hand, continuity on the other – and trying to find a pragmatic compromise somewhere in the middle. That’s why his Munich speech accepts the transatlantic alliance is changing but falls short on the consequences. And that’s why the conversation Britain is having about its geopolitical predicament remains one step behind where it needs to be.

Rhetoric vs. action

In Munich, the prime minister said Britain must ‘build our hard power’ and ‘be ready to fight’ if Russia tests NATO, which he said could happen by the end of this decade. Last time Britain prepared to fight a peer war in Europe, our defence budget jumped from 2.2% of GDP in 1933 to 6.9% by 1938. Today it is no accident that the scale and speed of rearmament lags far behind that benchmark. The government has committed to spending 2.5% of GDP on defence by April 2027, rising to 3% in the next parliament and 3.5% on core defence by 2035.

This slow and modest uplift by historical standards appears divorced from the urgency of Starmer’s rhetoric in Munich. In reality, it makes perfect sense, because alongside the call for urgent action, he also declared ‘we must do this with the United States’, the ‘indispensable power’. And there lies the problem. The government cannot justify a truly historic increase in defence spending to the public, and the difficult trade-offs that entails, while still insisting we are protected by the immense shield of US hard power. And so now the constraint of public opinion forms a dangerous synergy with Britain’s fragile strategic culture. We cannot admit to ourselves that the transatlantic alliance is breaking down, and so we cannot come clean to the public about the scale of spending needed to replace the protection it has provided.

The same dynamic explains why the prime minister rightly talks about a ‘more European NATO’ but has not put forward proposals for adaptations in European security architecture. If the transatlantic alliance is merely strained because Europe has not done enough on burden sharing, then the answer is to step up on spending and capability within the existing alliance structure. Talk of additional structures, such as a European Security Council, looks at best distracting and at worst reckless in this framing. If, however, NATO’s cohesion and effectiveness is compromised by American indifference – or even antagonism – towards Europe, then a European structural backstop becomes necessary for coordinating war planning, insulating political and military decision-making, and ensuring effective command and control.

The question is, which is it: strain, or rupture? Even the possibility of the latter would suggest the need for a European hedge on additional structure, such is the existential risk of that scenario. Yet Britain’s deep attachment to the special relationship makes anything that might alter NATO’s exclusive monopoly over European security feel threatening, even if that monopoly itself now poses a danger. This, combined with the fear of provoking ire among US policymakers who have a very different vision of what a more European NATO actually means, has produced inaction.

Ironically, the accommodation of complementary security structures would likely make NATO more durable as the transatlantic alliance shifts in the coming years – reinvigorated by co-equal leadership and no longer an instrument of dependence or an incubation of risk.

The changing American relationship has also gifted Starmer’s government an opportunity to accelerate closer ties with the EU. In Munich, the prime minister declared ‘we are not the Britain of the Brexit years anymore’, but current efforts to enhance cooperation still look more like the quiet reset that Labour initially envisaged upon entering government, rather than a deeper realignment.

Such a realignment does not have to mean rejoining. But whatever form it takes, whether it’s a customs union or the Swiss-style arrangement that the Labour Movement for Europe has argued for, it should be firm enough to provide Britain with the reliable geostrategic anchor it now needs as the world shifts around it. Unfortunately, as with defence spending, the government cannot convincingly make this argument to the public unless it concedes the special relationship is now too fragile to be relied upon.

The transatlantic alliance

In Munich, the prime minister said ‘The US National Security Strategy spells out that Europe must take primary responsibility for its own defence. That is the new law.’ But, he added, European strategic autonomy ‘does not herald US withdrawal’.

This diagnosis of challenge and change in the transatlantic alliance, rooted primarily in problems around burden sharing and Washington’s evolving strategic priorities, is reassuring both for doctor and patient. Britain will be safe if it pulls its weight; the alliance will endure. This would have been a fair assessment under the Obama and Biden administrations, but the Trump administration poses a completely different challenge. The real changing dynamic now is America’s transition from partner to challenger, from guarantor of the global order to revisionist power.

After the US military captured President Maduro in Venezuela, deputy chief of staff Stephen Miller – a key thought leader within the administration – offered a window into its worldview. Responding to questions, he said ‘we live in a world in which you can talk all you want about international niceties and everything else, but we live in a world… that is governed by strength, that is governed by force, that is governed by power.’ A few days later, Trump himself echoed this logic in an interview with the New York Times.

The embrace of unrestrained power and force as a replacement for the liberal world order has found expression not just in words but in the administration’s actions: the seizure of Maduro, threats against Greenland, economic coercion through tariffs, and now war with Iran. In each case, international law, treaties, and alliance obligations have barely surfaced in the administration’s reasoning. Strength is the new order.

In choosing to focus on burden sharing and trying to ignore the rest, Britain is taking comfort in one isolated part of Washington’s rhetoric while overlooking what has really changed. To determined Atlanticists, this may seem justified. Trump is an aberration, so the thinking goes, and the alliance can be put back together once he’s gone. In the meantime, Britain should play for time and meet America where we can.

This is a soothing refrain. When Britain’s material and psychological dependency on the special relationship runs so deep, it’s natural to reassure ourselves that this very depth insulates us from whatever damage a single president could do, and that continuity is waiting for us on the other side. But this is a flawed reading. It is not a question of aberration versus rupture. The aberration is the rupture.

America’s role in underpinning the liberal world order and the western alliance system is unique. In both respects, it functions as a hegemon. That role brings enormous power but demands a high level of trust, as it requires other states to exchange their autonomy for protection. To enable this exchange, the hegemon must maintain the illusion – for it can only ever be an illusion – of immutable stability.

Britain today is the prime example of what happens when that illusion is believed. Our defence architecture, and our entire defence psychology, is built upon the idea of America as completely and forever dependable. This kind of trust must be earned slowly – but it can also be spent quickly. By flagrantly ignoring and rejecting the international rules it has carefully built over decades, and by acting coercively towards its closest allies, America has spent eighty years of trust in just over a year.

The impact is already registering across Europe, both amongst policymakers and the public. A January 2026 YouGov survey revealed that only 26% of British, 20% of French, and 14% of German respondents now see the US as an ally, down from 50%, 36%, and 42% respectively in July 2023. Spain and Portugal have both withdrawn from plans to purchase American-made F-35s, with the Portuguese defence minister citing ‘The recent position of the United States, in the context of NATO and the international geostrategic plan’ as the blocker. France has even announced plans to ban public officials from using US tech, while a movement has emerged in Germany to repatriate its gold reserves from the US. The most significant move, though, has been the explicit Europeanisation of France’s nuclear deterrent – a signal that Europe no longer fully trusts Washington to protect its allies with nuclear weapons.

This loss of trust cannot snap back with the arrival of a new Democratic administration. Earning it back is a multi-generational project, requiring a reliable bipartisan consensus in Washington that has now eroded due to the influence of America First. Oscillating between challenger and guarantor of international order doesn’t work for alliance predictability or system continuity. The tragedy of the Trump administration is that it has mistaken coercion for power, accelerating the shift towards the end of American hegemony by undermining the system and alliances that enabled it. The tragedy of Britain is that its strategic culture is so deeply intertwined with the special relationship that it risks going down with the ship rather than charting a new course.

Britain: leader or follower?

The British government is attempting to carefully and pragmatically adjust to new geopolitical realities. That cautious reflex is understandable. But by optimising for caution in a moment of global upheaval and realignment, we misunderstand the nature of the risk.

As the contours of international power recalibrate over the coming decade, power will flow towards states that move decisively to shape their strategic environment before the pieces have settled on the board. Playing it safe and waiting to see what happens means Britain’s place in the world will be shaped primarily by the decisions of others.

That doesn’t have to happen. In principle, Britain is well placed among likeminded middle powers to play a leadership role during this period of turbulence. Aligned with the European Union geographically and strategically but not formally within it, Britain can pursue a model of international cooperation that is more inclusive of non-European liberal democracies, while still retaining its European anchor. This model would not attempt to revive the liberal world order – such a project would be overreach – but to align fellow liberal democracies with each other and orient them to the rest of the world in a way that reflects their strategic interests and respects their moral core.

Configuring post-Atlanticist liberal cooperation will be a significant undertaking. If Britain chooses to lead, two principles ought to guide us. First, cooperation should be horizontal, not vertical. This means likeminded states of similar power and capability coming together in pursuit of shared goals or projects, without any single state establishing vertical control. A prime example of this in practice is the Global Combat Air Programme, a joint venture by Britain, Italy, and Japan to develop a sixth-generation stealth fighter that prioritises co-equal ownership and national sovereign control. This model could be extended to developing and sharing strategic lift capacity, ISR capabilities, missile and drone defence, AI compute power (as the EU is already starting to do), and even defence financing through the proposed Defence, Security, and Resilience Bank.

The second guiding principle should be variable geometry. Liberal democracies have many differing interests, specialisms, and threat perceptions. Cooperation will be most fruitful where they overlap and most challenging where they don’t. We should lean into this reality rather than trying to work against it. This means complementing broad institutions with smaller, flexible coalitions built around specific tasks. The Joint Expeditionary Force serves as an important example in this regard. More such coalitions should be assembled around key threats and opportunities, starting with enhanced pre-positioning and rapid reinforcement for eastern Europe if NATO hesitates in the event of a crisis with Russia.

Critics of European autonomy rightly point out that European cooperation is often stymied by fragmentation and disagreement, and that’s before adding non-European liberal democracies to the mix. But horizontal cooperation and variable geometry have a protective effect here. No single state can play the role of blocker, and states do not have to participate in activities that don’t align with their interests or capabilities. This also helps to inoculate against the impact of populist spoiler governments.

The conversation about new forms of cooperation is just beginning. With its expeditionary armed forces, soft power leadership, advanced technology base, and unique geostrategic range, Britain has a great deal to offer. But the question remains: will Britain be involved at all?

At Munich, the prime minister challenged the idea that the transatlantic alliance is in a state of rupture, saying instead this should be a ‘moment of creation’. I agree that the task of creation must now be the imperative of British statecraft. But what if rupture is not the enemy of creation, but its prerequisite? We cannot build our place in the new order while pretending the old one still exists.

After the combined traumas of Suez and Iraq, and eighty years spent wrapped in the reassuring embrace of the special relationship, it’s not surprising that Britain struggles to trust itself. Our strategic imagination is narrow because that feels safer, easier, simpler. But the new world we’re entering demands more of us. We must have the confidence to adapt and to lead, and that starts with being honest about what has changed, even if that means staring our own fragility in the face. Only in that reckoning can the task of creation begin.

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