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As the US and EU struggle to confront Russia, the standoff in Crimea is forcing a rethink about European security and ties with Moscow.
LISBON, Portugal — As leading diplomats from the United States and Europe emerged on Wednesday from their first day butting heads with their Russian counterparts over Moscow’s invasion of Ukraine, the crisis is forcing Western countries to rethink some of their basic assumptions about security on the continent and their long-term relationship with Russia.
Three days before Russian troops began their seizure of Crimea, NATO headquarters released its annual report on alliance defense spending.
The densely packed data revealed a picture of persistent military decline among America's European allies.
Britain's defense budget has shrunk by an average of 1.38 percent every year since 2009. In France, the drop is 3.8 percent and in Spain and Italy, it's more than 5 percent a year.
Meanwhile, Russia's defense expenditure has doubled since 2007 and is scheduled to grow by another 44 percent over the next three years.
Russia devotes 4.4 percent of its gross domestic product to defense. Only three European allies — Estonia, Greece, Britain — meet NATO's 2 percent target.
Those figures show a shift in the European mentality since the Cold War.
In many countries, the armed forces are now seen as a luxury — for peacekeeping or counter-terrorism in far flung locations — rather than essential guarantors of homeland security. They’re one of the first to be cut during tight economic times.
Newer members such as Poland and the Baltic states have repeatedly warned that Europe's territorial defense isn’t outdated and appealed at recent NATO summits for a re-affirmation of the alliance's founding pledge of mutual defense.
Some mocked them for living in the past and jeopardizing the West's partnership with the new Russia.
Now events in Ukraine look set to force a reevaluation of the alliance’s stance.
The US announced on Wednesday that it will step up air patrols in the Baltic as well as military cooperation with Poland. That came a day after the Poles called for emergency consultations at NATO headquarters stating their security was at risk — only the fourth time a country has convened such talks in the alliance's 64-year history.
The alliance has announced it’s curtailing military cooperation with Russia, including by suspending staff-level contacts and halting plans to jointly escort ships ferrying chemical weapons from Syria.
"We have put the entire range of NATO-Russia cooperation under review," NATO Secretary General Anders Fogh Rasmussen said after talks at alliance headquarters in Brussels. "These steps send a clear message, Russia's actions have consequences."
But there’s little stomach among European allies for the more robust military response demanded by some hawkish commentators.
"The West still balks at taking even defensive military actions that would reinforce Ukraine’s security, reassure NATO’s Eastern members, and complicate Russia’s military planning," Ian Brzezinski, senior fellow at the Atlantic Council think tank, wrote Wednesday.
A senior Pentagon official during the George W. Bush administration, Brzezinski suggested NATO should mobilize its rapid response force, deploy forces to Central Europe and the Black Sea and provide security assistance to Ukraine.
However, European allies fear such bellicose maneuvers would further inflame the crisis in Ukraine.
They’re hoping to talk President Vladimir Putin into a de-escalation that would limit any spread of Russian intervention beyond Crimea and create space for negotiations between Moscow and Kyiv on an eventual settlement.
Although European leaders have warned Russia will pay a price unless Putin pulls back from military action, they’ve been vague so far about what that price could be.
Despite initial resistance from Germany and Italy, there has been a threat to boycott a G-8 summit of leading world economic powers that Putin was due to host this June in the Olympic resort of Sochi.
However, it's hard to see the Russian president viewing that as much more than a minor irritation given the importance he's attached to keeping Ukraine in Moscow's orbit.
Europe countries are divided on further sanctions — not least because so many of them have deep economic ties with Russia, including a dangerous dependency on fuel imports.
Germany gets 40 percent of its natural gas from the Russian monopoly Gazprom. In Greece, Finland and much of Central Europe, the figures range from 70 percent to 100 percent. In London, Russian millionaires have helped keep the real estate market buoyant as well as pump money into the financial markets.
Spain and Portugal are seeking to tempt Russian investment in their cash-starved markets by offering EU residency visa to rich Russians. And France is planning to deliver two high-tech warships to the Russian navy this year under a $1.9 billion contract.
In all, companies from the 28 European Union countries have $228 billion tied up in Russian investments, according to EU figures that put Germany in the lead.
As Europe's most powerful leader, Chancellor Angela Merkel has a key role in trying to talk Putin into backing away from Ukraine. But her natural caution on top of Germany's post-war aversion to conflict is surely being reinforced by warnings from senior German politicians that sanctions against Russia could cost German jobs.
"There is division among EU member states between values versus interests and the interests seem to be taking the upper hand in key member states," said Amanda Paul, an expert on Eastern Europe at the European Policy Center, a think tank in Brussels.
"As long as they think there is an opportunity to resolve this by dialogue and negotiation, there will be a strong opposition to put any sort of member state interests on the line for the sake of Crimea," she said.
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Nevertheless, some EU members will raise sanctions at an emergency summit set for Thursday.
French Foreign Minister Laurent Fabius said they could include the suspension of economic agreements with Russia and a halt to talks about liberalizing visa restrictions on Russians visiting the West.
"If there isn't a very speedy de-escalation in the coming hours, we will decide concrete measures... there could be targeted measures and that can also affect people, officials and their assets," Fabius told BFMTV.
Russian officials responded with a pre-emptive warning of retaliatory moves, including the seizure of foreign assets in Russia and defaults on loans to Western banks.
Despite the bluster, Russia is already having to cope with an economic impact from the Ukraine crisis. The central bank has had to raise interest rates and spend an estimated $12 billion to prop up a falling ruble. Billions more have been wiped of the stock market as investors take fright.
Meanwhile, the EU has announced a $15 billion aid package for Ukraine, including $1.4 billion that can be freed up immediately to help the stricken economy. The overall figure matches the amount of a bailout Russia offered in November.
As the high-stakes diplomatic maneuvering with Russia continues in the coming days and weeks, the West won't find it easy to isolate a country of Russian's size and economic power.
Those advocating a united front say only that would make Putin reconsider continuing his military adventure.
Given the divisions within Europe and Putin's success in exploiting those differences during previous times of tension, however, most agree it’s crucial for Washington to play the leading role.