Shifting Federal Spending From Social Programs to National Defence Is the Right Thing to Do

The federal government can’t do it all. That means taxpayers’ dollars need to be focused on the basics – what the federal government can do that other levels of government cannot.

Following the release of the spring economic update, the federal government is facing criticism from some on the left over social spending reductions/reductions in the pace of future social spending increases. For example, here’s what CUPE board member Michael Hurley said:

“$1.2b cut from mental health & addictions. $600m cut from LTC. $500m cut from drugs for rare diseases. Health transfers cut from 5% to 3% after 2028, despite a growing, aging population. Pharmacare phased out as of 2029.
Isn’t it time we spoke up?“

Canadian author Linda McQuaig contrasted social spending cuts with increased military spending:

“Incredibly important column by @althiaraj about Carney’s devastating social spending cuts. And this is just the beginning. Do all those celebrating Carney’s increased military spending have any idea what we’re going to lose?”

Doing what only the federal government can do

In March, the federal government announced that – for the first time in decades – Canada had hit the 2% NATO target. Under Justin Trudeau, the government planned to hit that target in 2032, a timeline wildly out of step with the risks Canada faces. Under Mark Carney, that target was hit six years earlier, and future increases are expected.

Meanwhile, healthcare, education, and social welfare programs can all be managed by the provinces, and are best managed at that level, where individual provincial governments can respond to the political culture and specific needs of their constituents. By contrast, no province alone can build a national military, nor can individual provinces manage national-scale infrastructure on their own. Further, a coherent national legal system must protect individual freedom and private property rights across the nation to ensure that a Canadian has the same rights no matter what part of the country they are in.

Thus, it logically follows that national governments should focus on national defence, national infrastructure, and managing the federal court system, while leaving most other functions to the provinces. That was not the case under Justin Trudeau, who expanded the size of government and ran large deficits even as key federal government areas of responsibility – like national defence – were underfunded. As a result, getting the federal government focused on the basics requires a rebalancing, and that rebalancing requires either outright social spending reductions or restraining social spending increases to below the rate of inflation+economic growth, while simultaneously increasing military spending above the rate of inflation+economic growth. Sustaining such a shift for a decade would result in a federal government that is much more focused on providing a robust national defence and much less focused on areas of provincial responsibility.

Canada needs a leaner federal government, a federal government that does what only a federal government can do. To the extent the spring economic update represents movement in that direction, it is a positive development.

Spencer Fernando