At the June 2025 NATO summit in The Hague, the former (and in that position very frugal) Dutch Prime Minister, currently NATO Secretary General Mark Rutte unveiled a new “defense investment plan” – demanding that allies boost spending to 5 percent of GDP.
It was billed as a “quantum leap” for collective security, split between 3.5 percent for tanks, jets and missiles and another 1.5 percent for roads and hangars.
One by one, leaders nodded in agreement – all except one.
Enter Spain’s Prime Minister Pedro Sánchez, the very embodiment of socialized spending, calmly sticking out the thumb. In an eleventh-hour letter to NATO’s chief, Sánchez politely asked to opt out of the 5 percent goal. He argued that leaping to 5 percent would be “unreasonable… and counterproductive,” moving Spain “further away from optimal spending” on pensions and social programs.
A stunned press corps branded Madrid “NATO’s new villain” and diplomatic aides groaned.
One defense official sniffed he had “no words to express [his] disgust” – as if suddenly a socialist leader preaching fiscal caution were a crime. The irony was sharp: the country long tagged a “defense spending laggard” was now torpedoing the alliance’s grand budget plan.
Europe’s hawks sputtered.
A UK lawmaker huffed, “Socialists… hardly one of solidarity” at Madrid’s plea. Denmark’s prime minister scolded that allies must be united, calling any opt-out “not fair”. Even stoic Poland – with its own plan to hit 4.7 percent of GDP – warned that a Spanish carve-out would set a “bad example”.
Behind closed doors though, NATO quietly relented: Spain was effectively granted an exemption from the 5 percent mandate. Sánchez even noted 2.1 percent was “enough” to meet Madrid’s military commitments.
In a blink, the socialist prime minister had flipped from pursuer of taxes to defender of the public purse.
For ordinary Spaniards, the clash felt grounded in real concerns.
Inflation in Spain ticked up to about 2.2 percent in June – high enough that shoppers squinted at gas bills and supermarket receipts. Many voters, especially pensioners and young families, likely wondered which would warm their homes more: an extra euro of heating subsidy or yet another €1,000 missile.
Sánchez and his ministers pointed out that meeting 5 percent would mean “raising taxes and cutting social programs” – a very tough sell during an election year.
Recall, Spain spent barely 1.3 percent of GDP on defense last year (the lowest in NATO), and had only just agreed to reach the old 2 percent target with a €10.5 billion increase.
Sánchez’s own coalition partners on the left – the Sumar and Podemos factions – had flatly opposed any extra military hike. To them, hypersonic missiles sounded ludicrous when soup kitchens and solar panels still needed funding.
In the end, Madrid’s stand came to seem like the only sober voice in the room.
NATO’s summit closed with a weaker consensus – everyone agreed on 5 percent except for Spain – but at least the alliance avoided a stand-off.
In fact, Sánchez pointed out that the United States itself wasn’t even signing up for 5 percent.
So, let’s raise a (non-alcoholic) toast to Spain’s budget rebel: the one socialist leader who quietly asked the trillion-dollar question—who’s going to pay for all this?
In a theater of fantastical spending, Spain was content to mind the fiscal till. Here’s to realism: the dry-wit sanity check in a room addicted to big dreams.
