When defense budgets are spent honestly, each euro is more likely to produce real capabilities. In Russia a significant portion of defense spending is compromised by graft and misallocation, which means that over time Europe’s investments, euro-for-euro, will yield stronger and more reliable forces.
While recent developments and pledges — such as the European Defense Fund, Germany’s increased defense allocations, and other national commitments — suggest Europe is on track to spend nearly €500bn ($540bn) on defense in 2025, it will take time for the continent’s chronically underfunded armed forces and industrial capabilities to catch up to Russia’s.
Given that most Russian military kit is produced domestically, it makes sense to analyze its expenditure in terms of purchasing power parity. In 2024, Moscow spent more than $462bn, far more than all Europe combined, and the Kremlin plans to spend 25% more this year, meaning Europe has a long way to go.
The better news is that not all of Russia’s funds are well spent, and deeply entrenched corruption affects all aspects of the Kremlin’s war machine, from purchasing decisions to battlefield performance. About 40% of its military budget goes towards procurement, and kickbacks alone are estimated to double those costs.
Known sources of Russian underperformance, such as overcentralized command and control, can partly be explained by corruption, which erodes tactical battlefield effectiveness, supports unmeritocratic systems, and corrodes decision-making. The 64km-long Russian convoy targeting Kyiv in 2022 is a case in point. Fuel had been resold and parts were lacking, tires were switched out for lower quality ones, and vehicles were not properly maintained. Political scientists, partly inspired by Russia’s poor performance in the Ukraine war have explored the impact of corruption on war outcomes. They found clear evidence that the negative effects are so great that they contribute to ultimate defeat.
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A higher absolute or relative level of corruption is highly predictive of both war outcomes and relative manpower losses, after accounting for factors including size of economy and government type, according to my research and, independently, that of Leonardo Gentil-Fernandes from the University of Tennessee and Jacob Otto at the University of Pittsburgh. We find that a country half as corrupt as its foe is around 70% more likely to win a war if all else is equal.
How much of an advantage does that give Europe? While corruption is difficult to measure, country indices suggest the continent’s relative cleanliness is an invaluable force multiplier.
Russia is three or four times as corrupt as Germany, France, and the UK, according to the Corruption Perception Index, a record which is strongly correlated with Russian procurement. The Varieties of Democracy Political Corruption Index suggests Russia is at least 12 times more corrupt than the named European countries.
In the short term, Europe’s comparatively cleaner defense environment will ensure its rising military spending stands a good chance of being deployed effectively, rather than lost to corruption. If tensions were to escalate into open conflict, European forces would likely enjoy a powerful operational edge, free from the corrosive effects of widespread graft.
Corruption levels do more than just distort defense spending, they reflect deeper social norms, institutional structures, and the accountability of leaders and elites. Europe’s comparatively low levels of corruption stem not simply from regulations or oversight, but from a political culture that values transparency and civic trust.
These ideals are essential to the continent’s security and resilience. At a time when strongmen are proliferating, the impact of corruption serves as a reminder that Europe’s rule-based system is worth fighting for.
Nathan Decety is a macroeconomic strategy consultant and a captain in the US Army.
Europe’s Edge is CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America. All opinions are those of the author and do not necessarily represent the position or views of the institutions they represent or the Center for European Policy Analysis.
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Europe's Edge
CEPA’s online journal covering critical topics on the foreign policy docket across Europe and North America.
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