Europe finally appears serious about rearming. German legislators have agreed to exempt defense from constitutional limits on debt spending. The European Commission is urging members to raise military budgets to 3% of gross domestic product and issue joint debt to fund weapons purchases — moves that could unlock more than $867 billion in additional spending over four years.

If European leaders are to build truly capable militaries that no longer depend on the U.S., however, they’ll need to change how they spend on defense, not just how much.

To be effective, any new funds must be deployed strategically, efficiently and cooperatively — something Europe has historically struggled to manage. Billions in joint European Union funding for COVID relief, for instance, were allegedly lost to fraud and waste; accountability has been a problem.

Past defense buildups have fueled fragmentation rather than cooperation. European militaries field 29 different types of major warships, 27 howitzers, 20 fighter jets and 17 main battle tanks. By comparison, the U.S. operates four, two, six and one, respectively. This overlap inflates costs and dilutes effectiveness. Consolidation alone could free up 30% more resources, the European Defense Agency estimates.

Despite its plethora of platforms, Europe continues to rely on the U.S. for capabilities that are core to its security, including airlift, missile defense, precision-guided munitions, and intelligence and surveillance systems. Over the past decade, European nations spent $100 billion on U.S.-made arms. Almost two-thirds of imports by European NATO states from 2020 to 2024 came from the U.S.

The immediate task must be to shore up Ukraine’s defenses. Allowing the country to falter would create instability on Europe’s doorstep, weaken deterrence, embolden Russia and ultimately require even greater defense expenditure. Realistically, that means some of the new funds will also have to be spent on U.S.-made artillery, missile-defense systems and other capabilities while European factories gear up.

Achieving genuine defense autonomy will demand deeper reforms, many outlined in a white paper issued by the commission last week. The top priority is to rationalize procurement. European countries too often invest in platforms unsuited for modern combat or which are not the best use of available resources (the UK’s aircraft carrier fleet is a case in point). Notably, only 18% of European procurement was collaborative in 2021, well below even the modest target of 35%.

Nations with often very different ideas of what constitutes security will quickly have to agree on a defense concept. Leaders must confront national protectionism head-on, promoting policies that favor integration and interoperability over continued duplication. (The Eurofighter aircraft and MBDA Missile Systems Services SAS, the pan-European joint venture in missile manufacturing, show cooperation at scale is possible.)

Next, European manufacturers will require stable, long-term defense contracts. Companies will only invest in building sustainable industrial capacity and developing a skilled workforce if they can count on a predictable pipeline of orders.

Finally, Europe’s defense sector must attract more private-sector investment. Venture capital flows lag considerably behind those in the U.S. Clear regulatory frameworks and targeted tax breaks can help spur innovations in emerging technologies such as drone, cyber and electronic warfare.

While the commission can encourage such changes, only national capitals, combining forces, can see them through. Existing NATO infrastructure offers one ready means of coordination. Having long called on its allies to do more while paradoxically discouraging a European defense identity that would pull orders from American firms, the U.S. should welcome and support the process. It, too, will be stronger if Europe spends more on its defense — and spends better.