Prime Minister Mark Carney, left, and National Defence Minister David McGuinty make an announcement aboard HMCS Margaret Brooke at HMC Dockyard Halifax on Thursday.Darren Calabrese/The Canadian Press
Roy Rempel was responsible for defence policy matters in the Office of the Prime Minister from 2010 to 2015. His book Counterweights examined the history of Canada’s defence relations with Germany and NATO.
While every Canadian government has grappled with the question of how to maintain national independence and policy autonomy from its powerful southern neighbour, Canada today is confronted with the most capricious and unpredictable American administration in its history. It has led Prime Minister Mark Carney to furiously travel the world in search of new partnerships.
But travelling the world and securing preliminary agreements will not be enough. Diversification requires a real shift in where the government chooses to spend its money.
It is in this context that the government recently released its defence industrial strategy. Based on the premise that overreliance on the United States in the defence sphere is no longer wise policy, the strategy aims to “increase the share of defence acquisitions awarded to Canadian firms to 70 per cent” by partnering with other countries and firms.
The objective of trade diversification itself is not new. However, historical efforts have always foundered on the reality of America’s overwhelming gravitational pull. If this government wants a different result, it is probably useful to consider why previous efforts failed, to thereby avoid similar mistakes.
Opinion: Mark Carney’s strategy for the public service becomes clearer
The last significant effort at diversification occurred in the 1970s when Pierre Trudeau pursued his “third option” strategy, aiming to diversify Canada’s international trading relationships in the face of the economic shocks wrought by the Nixon administration in 1971. The Trudeau government believed that, with around 65 per cent of Canadian trade occurring with the U.S., Canada had become too vulnerable. Just as Mr. Carney has done, Mr. Trudeau signed preliminary bilateral agreements with countries in Europe and elsewhere.
Yet, within a decade, the third option was deemed a failure. Canada’s trade with the U.S. increased, rather than decreased.
While many have concluded that the economic pull of the United States had simply been too great to resist, there were other reasons for the strategy’s failure. Principal among these was the fact that defence policy was never integrated into the strategy effectively. This undermined Canada’s ability to forge closer economic ties with Europe, for whom Canada’s military commitments were important. While the Europeans had been open to closer defence industrial ties, almost all of Canada’s defence purchases (including fighters and patrol aircraft) were still being made in the United States; such purchases dwarfed those that Canada made in Europe. In essence, the government’s rhetoric was about diversification, but its actual spending remained continentalist.
Fast forward about 50 years, and diversification is again on the agenda. This time, defence appears to be an integral component of the strategy, which is particularly critical given the projected scope of the planned increase in defence spending. Even so, it’s not clear that the words are being matched by action.
In the past year, the Canadian government has poured its defence dollars into exactly the same place it has always spent them: the United States. It has purchased multiple-launch rockets, army vehicles and torpedo defence systems from the United States. Other acquisitions, such as maritime patrol aircraft, UAVs and naval systems, are also being made in the United States. Most recently, Ottawa (quietly) announced that, irrespective of its policy “review”, it had made long-lead orders for another 14 F-35 fighter aircraft, in addition to 16 already ordered.
Collectively, these purchases will lock Canada into the closest possible defence integration with the United States for decades to come. And while there are likely to be future opportunities to partner with global firms – for instance, on submarines – the fact is that foundational decisions are already being taken that point in a very different direction.
The Trudeau government’s third option approach to trade diversification failed, in part, because it paid insufficient attention to how defence policy and spending might complement its broader policy objectives. The fallback on most defence acquisitions was to default to the specific equipment desires of the Department of National Defence.
While Mr. Carney has demonstrated considerably more interest in defence than Mr. Trudeau, it will take much more than preliminary bilateral agreements for real diversification to become a reality. The Carney government must formulate a credible national defence strategy – which it has not yet done – and then ensure that its procurement spending supports that broader strategy. Without such a plan, defence diversification under Mr. Carney is likely to meet the same fate as Mr. Trudeau’s third option.