This will only further deepen the impression around the world that Canada is not a serious country, at a time when serious leadership is needed to address growing threats.
At a deeply unsettling time here at home and around the world, Canadians would be grateful for serious leadership that could provide at least a semblance of reassurance that ‘the adults are in charge.’
Unfortunately, that reassurance is nowhere to be found.
Because instead of serious leadership, we have a federal government that demonstrates a serious lack of understanding of what is really at stake.
The gap between words and actions
The Liberal government regularly talks about the need to stand with our fellow democracies, counter the threat posed by Russia (a country that is still heavily building up their military power in the arctic), and defend the ‘rules based international order.’
Taken on their own, those words are quite reasonable, though the lack of discussion of China’s massive military build up and increasing aggression is a serious omission by the government.
Still, most of what the government says in regard to foreign policy and defence policy is no different than what our allies say. Unfortunately, the government doesn’t back up those words with actions, and the gap between what they say and what they do is only widening.
Cutting defence spending
Just a few weeks ago, the Canadian government expressed support for a commitment to meet NATO’s 2% of GDP military spending target.
That target has long been something that Canada’s biggest ally and biggest defender – the United States – has been demanding we hit. It’s one of the few issues on which the Obama Administration, Trump Administration, and Biden Administration were in lockstep, as U.S. frustration with Canada’s lack of defence spending has only grown with time.
At a time when Russia’s military spending is rapidly increasing (the country now resembles the ‘total war’ economies of World War Two), and there is a growing belief that China’s military spending has been severely undercounted, it is imperative for Western democracies to build up their military capabilities.
Given high per capita GDP and overall GDP compared to the rest of the world, a strong commitment by Western democracies to military expansion would result in a truly formidable fighting force. The only reason countries like China, Russia, and North Korea are able to pose such a significant conventional military threat is that many EU countries like Germany, and ‘middle power’ countries like Canada have spent decades deliberately underfunding our armed forces. Notably, democratic South Korea – facing a massive threat right across their border – is heavily militarized and produces a vast amount of artillery – something we will look at later on.
The relative military power of the authoritarian states is thus not a ‘natural advantage,’ it is an advantage they’ve gained simply due to their willingness to spend a higher portion of their overall GDP on building up for potential war, and the unwillingness of many free nations to do the same.
And so, it goes without saying that now would be the worst possible time for Canada to cut our defence spending.
So of course, that’s exactly what the Liberal government is doing:
“The Liberal government is looking to cut almost $1 billion from the annual budget of the Department of National Defence (DND) — a demand the country’s top military commander says is prompting some “difficult” conversations within the military.
Chief of the Defence Staff Gen. Wayne Eyre and Deputy Minister of Defence Bill Matthews testified before the House of Commons defence committee late Thursday, where they acknowledged in more detail the ramifications of the federal government’s spending reduction plan.
Earlier this month, Eyre and Matthews released a joint internal statement warning that the department would be expected to contribute to the federal government’s overall plan to reduce spending.”
“There’s no way that you can take almost a billion dollars out of the defence budget and not have an impact,” Eyre told the four-party committee. “This is something that we’re wrestling with now.”
As noted by defence & security reporter Murray Brewster, this comes just weeks after Canada expressed a willingness to do the opposite:
Word of the planned cuts, which have not been specified, comes just weeks after the Liberal government agreed with other NATO allies on a pledge to make the alliance’s defence spending benchmark of two per cent of gross domestic product an “enduring commitment.”
Living up to that pledge would require a substantial increase in the defence appropriation.”
Chief of Defence Staff warning
Speaking to a Parliamentary Committee, Chief of Defence Staff General Wayne Eyre didn’t mince words when warning about the impact of the planned cuts:
Trudeau and his Liberals cut another billion dollars from national defence. This will only hurt our troops. pic.twitter.com/NvilcVIxza
— James Bezan (@jamesbezan) September 29, 2023
In response to questions from Conservative Shadow Minister for Defence James Bezan, Defence Minister Bill Blair claimed the government was looking at “carefully and thoughtfully” spending taxpayer dollars:
“The fiscal environment in Canada right now requires that when we are spending Canadian taxpayers dollars, that we do it carefully and thoughtfully. I’ve always looked upon the expenditure of tax dollars as an investment in creating public value for Canadians.”
Now, to say that this is hypocritical would be the understatement of the century.
No Canadian government in recent memory has spent money as recklessly as the Liberals.
The cost of government has risen by 36% under Justin Trudeau’s time in office, and most of that increase cannot be attributed to the period of increased spending/reduced revenues during the covid-19 pandemic.
In fact, the Fraser Institute has noted that had the Liberal government simply held the cost of government in line with inflation+population growth, they would have spent $150 billion less. Again, this is before the impact of the covid-19 pandemic:
“During Prime Minister Trudeau’s first term in office, the federal government increased nominal program spending by 36.1 per cent—from $248.7 billion in 2014/15 to $338.5 billion in 2019/20 (pre-pandemic)—far outpacing economic growth and inflation and population growth every year from 2015/16 to 2019/20.
To put this into historical context (and adjusted for inflation), Prime Minister Trudeau broke the record for the highest level of per-person federal spending in Canadian history at $9,224 in 2018/19 and again in 2019/20 ($9,671). Remember, this was before COVID. In other words, Canada entered the pandemic with spending levels already at record highs, which raises questions about what could have been.
For example, our new study finds that if Ottawa had tied the rate of federal program spending growth to either a) inflation and population growth or b) economic growth from 2015/16 to 2019/20, the federal government would have recorded surpluses nearly every year instead of persistent deficits, and avoided approximately $150 billion to $160 billion in additional debt.”
Thus, there is no way for the government to credibly claim that they have been ‘careful’ with taxpayer dollars.
Even worse, they managed to spend such vast sums of money without fulfilling the most important task of the federal government – the national defence of the nation.
It is also deeply insulting to our own troops – many of whom have had to buy their own equipment and food while stationed overseas – that they are not adequately equipped despite such massive federal spending increases.
How much more should Canada be spending?
We often hear people say Canada “can’t afford” more military spending.
This is usually said while referencing Canada’s large budget deficits, and the many challenges facing Canadians amid a declining economy.
Yet, increased defence spending is in fact quite affordable.
With Canada experiencing rapid population growth, the budget deficit can be significantly reduced simply by freezing spending in most federal departments, or even reducing the rate of growth of that spending.
In the chart below, you can see federal revenue and federal spending for each quarter between Q1 of 2018 and Q2 of 2023:
A few things will stand out here. For one, the government ran truly gargantuan deficits in 2020 with much of the private sector economy shut down. Additionally, you’ll notice that the government maintained a significantly elevated level of spending even after the pandemic. And, you can see that – in the absence of an event like a pandemic – federal revenue tends to increase at a relatively rapid rate.
With a slight shift towards pre-pandemic spending levels, general restraint in most federal departments, and a focus on investing in the military, a military build up is quite achievable.
So, it’s not a question of whether we can ‘afford’ to increase our military spending, it’s a question of whether we want to.
Make choices, accept tradeoffs
All spending is not the same.
Spending on buying tanks, producing artillery, recruiting and training CAF members, and funding military research & development can do much more for our country than expanding the size and pay of the federal bureaucracy. As you likely know, the size of the federal bureaucracy has grown substantially during Justin Trudeau’s time as Prime Minister, which is a key reason people wonder why so much money has been spent without an increase in the quality of government services.
By choosing to spend so much on expanding the federal bureaucracy, the Liberal government chose not to spend on other things – like our national defence.
Had some of that money gone towards building up the Canadian military, we would be seen as much more credible by our allies and would be better able to ensure the defence of North America, as well as contributing to key NATO missions in Eastern Europe to deter Russian aggression.
Instead, our credibility is depleted and we are far more vulnerable than we should be.
Another factor that is often ignored is that military spending can have significant long-term benefits for a country, a point made by Conservative Foreign Affairs Critic Michael Chong:
“1/ And some wonder why Canada’s influence is declining on the world stage. And why we can’t defend ourselves.
Less defence spending means less ability to attract foreign direct investment. To attract R&D. In short, to secure our prosperity.”
“2/ Failing to meet our NATO spending commitments is one of the reasons our per capita GDP is in free fall.
Long run GDP growth needs productivity growth. Our productivity growth is negative. That’s in part b/c we don’t spend enough on R&D.”
The already-robust U.S. private sector receives a further significant boost from federal military investment, which often drives technological innovation with long-term civilian applications.
It also works the other way, as the civilian drone industry will both contribute to – and benefit from – developments in the use of drones for military purposes.
By refusing to meet our NATO commitments, Canada is thus also damaging our own long-term economic prospects.
A massive political error
Aside from the practical impact of reducing military spending at at time when authoritarian states are building up their militaries, there is a political aspect to consider.
Canada has absolutely done the right thing by providing significant aid to Ukraine, and we must continue to do so. Ensuring public support for that aid will depend upon Canadians seeing that the Canadian government is also taking care of our military needs.
Now, given Canada’s current deployments, Russia is the country Canada would be most likely to fight – if Russia invaded a NATO country like Poland, Estonia, Lithuania, or Latvia. Thus, aid for Ukraine is in many ways a military investment, because the more Russia’s military is weakened in Ukraine, the less likely it is that Russia invades a NATO nation and thus the less likely it is that Canadian troops fight in Europe.
Russia has already removed many troops from borders with NATO countries, which shows both that Russia doesn’t actually fear being attacked by NATO (that has also been a Russian propaganda lie to try and justify their invasion of Ukraine), and that supporting Ukraine reduces the threat posed to NATO countries.
This is why – while supporting Ukraine is morally right – it is also right from the perspective of cold strategic calculus. Supporting Ukraine’s victory is the objective ‘pro-peace’ position, as a victory for Russia would result in the expansion of Russia’s population, an expansion of Russia’s military industrial base, and an increase in the likelihood of a much wider war.
Still, with all of that in mind, it remains essential that the Canadian government invests in building up our own severely depleted armed forces in addition to continuing to support Ukraine.
And this has a real cost.
We should be spending between $25-$30 billion more per year on our military.
We should be buying hundreds – if not thousands – of tanks, significant amounts of artillery, tens of thousands of drones, hundreds of advanced fighters, long-range missiles, strategic bombers, new ships, and nuclear submarines. We should be increasing pay for soldiers, and significantly increasing support for Veterans. After all, who will sign up when they see that those who were injured serving our country aren’t taken care of back home?
This will cost a lot of money.
We should also be investing in domestic production.
A key lesson of Ukraine’s defence against Russia’s invasion has been that many of the most advanced weapons systems – while important to have – are less influential than the ability to produce vast amounts of artillery and drones.
The artillery production capacity of the Western world has atrophied in recent decades, and must be rebuilt – both to help Ukraine and to ensure that Canada and our allies have a near-endless supply of artillery in the case of a massive global conflict. South Korea has provided significant amounts of artillery to Ukraine, as much of the Europe and even the United States seeks to desperately rebuild artillery production capacity.
This goes to show that we should be building military factories across our nation – in partnerships between or own defence companies and allied defence companies – to ensure that we can meaningfully contribute to allied stockpiles.
Getting to where we need to be in terms of defence spending requires a real shift in thinking.
A long-overdue conversation
For far too long, Canada has been a free-rider when it comes to national defence. Because the United States has a direct national interest in defending North America, we’ve been able to get away with letting our own once-formidable armed forces slowly wither away.
By doing so, we not only became increasingly complacent, but also dangerously naive.
It is not uncommon to see Canadians on both the right and the left of the political spectrum express the kind of ‘pacificist’ views that empower authoritarian regimes and weaken our resolve to defend ourselves and our allies.
Just ask yourself what would have happened if the United Kingdom and the United States had been pacifist nations in World War Two. Would that have stopped war?
Of course not, it simply would have made it possible for the most genocidal regimes to roll to victory unopposed.
The same is true today.
Refusing to invest in our own national defence, refusing to meet our commitments to our allies, and refusing to provide support to Ukraine won’t bring ‘peace’ or reduce the likelihood of further war, it will simply mean that Russia and China will be able to oppress and kill millions more people without much resistance from those have the wealth and power to resist them.
As a country, we must take a moment to mourn the fact that the 21st century has not turned out to be nice and peaceful, and – having accepted that sad reality – adapt to it and confront the challenges of the future from a position of military strength and national resolve.
If we want to secure our rights and freedoms, and if we want to ensure that the future is a future where democracy, human rights, and economic freedom prevail, then we must spend billions more on our military and finally start meeting our commitments to our friends and allies.
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