Prime Minister Mark Carney greets members of the Royal Canadian Navy aboard HMCS Margaret Brooke at the HMC Dockyard Halifax on Thursday.Darren Calabrese/The Canadian Press
Impressive ambition. A needed boost for Canadian sovereignty. Some hope for industrial transition. But when you get down to the math, there is only half the equation.
The figures are big. After touring a Royal Canadian Navy ship on Thursday, and boasting that Canada has finally met the NATO target for defence spending, Prime Minister Mark Carney made a point of underlining the scale of the defence buildup to come.
“Over the next decade, Canada will unleash a half a trillion dollars – I’ll repeat, a half a trillion dollars – in defence and defence-related investment, from submarines and aircraft to drones, sensors and radar systems,” he said.
Still, let’s remember there was supposed to be something else that went with “investing” in Mr. Carney’s big picture. The equation he promoted was “spend less to invest more.” Lately, half of that formula has gone missing.
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Certainly, the Canadian public isn’t worrying about deficits right now. But the Prime Minister is telling Canadians his government is embarking on a massive, transformative, budget-revamping plan that will displace other government activities for a generation.
There is a budget plan to trim some spending, including cutting 30,000 jobs in the federal public service over three years. Real people will lose jobs. But that will save the federal treasury a pittance compared with the defence buildup.
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On Thursday, in Halifax with Defence Minister David McGuinty, Mr. Carney celebrated the fact that NATO had declared that Canada has finally met the alliance’s spending target of 2 per cent of gross domestic product.
That’s a milestone. Canada spent only 1 per cent of GDP on defence in 2014, the year when the 2-per-cent target was set. For a decade, there was no real plan to get there. It’s a signal of change.
Yet the 2-per-cent target is now officially a stepping stone to a more ambitious target, set last year, of spending 3.5 per cent of GDP by 2035.
Mr. Carney didn’t just promise to meet that new target. He touted the planned buildup as a necessary means to protect Canadian sovereignty and build Canadian defence industries. He embraced it as a big part of his plan for Canada’s future.
“In this century, the work of defending Canada is also the work of building Canada,” he said Thursday.
So, what will Canada stop doing to make way for that big priority?
The estimated defence spending for 2025-26 was roughly $63-billion. To meet the 2035 target of 3.5 per cent of GDP, it would have to be increase by nearly $50-billion – more, presumably, because the country’s GDP will (hopefully) grow over the next decade.
The scale is enormous: Ottawa could completely eliminate three medium-sized federal departments, the Royal Canadian Mounted Police, the national child-care program and national dental care and it still wouldn’t cover that proposed increase in defence spending.
(It’s worth noting, too, that the new NATO target comes with a related target to spend an additional 1.5 per cent of GDP on defence-related spending – although that rubric includes so many things that it will be less onerous.)
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Of course, Mr. Carney’s government could back away later from the 3.5-per-cent target. NATO set the new targets to appease U.S. President Donald Trump, so perhaps they will be dropped when Mr. Trump leaves the White House. Or Mr. Carney could delay the bulk of further spending increases till he leaves office.
But he has just told us all that spending is needed, that it is vital for Canadian sovereignty and the Canadian economy. He touted it as a way to build a new industrial base, and that seems pretty important for a country with industries threatened by U.S. trade policy. Presumably he doesn’t want to hold back till 2035.
It’s true that the Canadian public isn’t in the mood for an austerity program. Mr. Carney boasted about unleashing half a trillion dollars because he wants people to envision economic growth. And he’s not going to set out details of the next 10 budgets.
But there has to be something to fill the hole. Mr. Carney is telling us he is embarking on a decade-long program to invest more in defence because it is a critical vocation for government in this century. That requires a long-term plan to transform government. That side of the equation is missing.