I have wondered if the NATO system would be better-designed if it had specific defense requirements from all countries, but I presently think its current structure (where Germany is allowed to reduce military spending because they're surrounded on all sides by other NATO countries) prevents a worse outcome, where they'd find it in their interest to leave NATO and get the buffer states anyway. Voluntary multilateral treaties like this only work when every signatory believes they're benefiting, and if you asked Germany to raise defense spending they'd respond with "okay, and how will we be compensated?"

Then, you'd say "nevermind, I'd rather spend it on my own armed forces," and you arrive back at NATO.