North Atlantic Treaty Organisation members, including Germany, have committed to spend 2 percent of their economic output on defense, but it's not clear if Trump understands that the money isn't going to North Atlantic Treaty Organisation; it's a country's total military spending.
Although Nato members are required to spend two per cent of their GDP on defence, the United Kingdom is actually one of only five countries to do so.
"There is no debt account at NATO", Ms von der Leyen said in a statement, adding that it was wrong to link the alliance's target for members to spend 2 per cent of their economic output on defence by 2024 exclusively to NATO.
Germany, whose wartime past has led it traditionally to be reticent on defense matters, now spends 1.2 percent of GDP.
"Defence spending also goes into United Nations peacekeeping missions, into our European missions and into our contribution to the fight against IS terrorism", Ms von der Leyen said. "These nations must pay what they owe", Trump said on Twitter.
German defence spending is set to rise by 1.4 billion euros to 38.5 billion euros in 2018 - a figure that is projected to represent 1.26 per cent of economic output, Finance Minister Wolfgang Schaeuble has said.
Although the visit began cordially enough, with the pair shaking hands at the White House entrance, Merkel's suggestion of another handshake in the Oval Office went unheard or ignored by Trump.
"Despite what you have heard from the FAKE NEWS, I had a GREAT meeting with German Chancellor Angela Merkel", the president tweeted.
"I owe it to you all to give you clarity on the political reality in the United States and to state the fair demand from my country's people in concrete terms", Mattis told foreign dignitaries in a closed-room meeting.
However, former US Ambassador to Nato Ivo Daalder dismissed the criticism a day later and said "that's not how NATO works". "That's a good thing".
"Number one it was obsolete, because it was designed many, many years ago". "But it is a process, and it is a process that the United States of America wanted. and we can not simply cast off this process from one day to the next".