Yes ... countries that can't decide to invest in their own hospitals or education are going to arm themselves to pursue wars to protect little states thousands of kilometers away they barely even trade with. I haven't even mentioned that even as part of NATO they have systematically refused to invest in the defense of the Baltic states. That is not ancient history, that's 6 months ago. Oh and they're financing this with loans. EU government debt is already a pretty heavy burden in ... essentially everywhere except Germany. So they're kicking the can down the road, and this is military investment. It's not going to improve anything about the EU. It'll either do nothing at all (that's the optimal scenario: Russia is deterred and nothing happens. The economic production rots away in some secret basement until it literally decays into dust) or it'll cause destruction. Its value is either zero or MINUS trillions. The loans, however, will need to be repaid.

I'm just thinking ahead to what will happen once these loans turn from a short-term economic boost and start dragging the economies further down.

Yes. You see whats going on in Ukraine. Small countries have either partner countries or the bigger ones use them as proxies like i would assume would happen with lithuania.

There is no issue with loans.