Justin Trudeau hints at boosting Canada’s military spending

I'll believe it when I see it.

 

[IKnowNothing]

Contracts can be reopened and renegotiated.

And losing bidders can then sue for lost opportunities, since "if we knew you wanted twice as many we would have offered a better price".

They can, but as a G7 nation maybe we should stopping running in fear of the vendor and remember that not only are we the customer- but a pretty damn big one at that. It's one thing to safeguard against shenanigans like using a misleading/smaller RFP to intentionally backdoor a materially different/bigger contract. But that wouldn't be the case. The situation has fundamentally changed. New geopolitical reality, potentially new government, new priorities. Sometimes pragmatism needs to win the day.

 

[dapaterson]

CAF purchases are not major. Tripling the number of LVM trucks would still be a drop in the bucket on a modern production line.

Yes, there are authorities that can be exercised. It's a question of where and when to do so.

 

[Grunt_031]

Its because they realize to get to where we need to be means cutting social spending and probably foreign aid. And Canadians looooove their social programs.

And this will be the downfall of the Conservative when they get in, resulting in one term.

 

[dapaterson]

As I recall the biggest single expenditure is Old Age Security. And seniors vote.

 

[QV]

They can, but as a G7 nation maybe we should stopping running in fear of the vendor and remember that not only are we the customer- but a pretty damn big one at that. It's one thing to safeguard against shenanigans like using a misleading/smaller RFP to intentionally backdoor a materially different/bigger contract. But that wouldn't be the case. The situation has fundamentally changed. New geopolitical reality, potentially new government, new priorities. Sometimes pragmatism needs to win the day.

That sounds like bringing more of a business approach to government. Where have we heard that?

Bottom line: we need to suspend risk adverse bureaucratic approaches and become agile and efficient quickly. The situation has changed and so must the response.

 

[IKnowNothing]

CAF purchases are not major. Tripling the number of LVM trucks would still be a drop in the bucket on a modern production line.

Yes, there are authorities that can be exercised. It's a question of where and when to do so.

That's only with respect to a product that also has widespread commercial use.

But even in that case- remembering our size as a customer isn't just about exerting demand side leverage- I'd argue that the far larger aspect is maintaining perspective on the scope of a potential complaint/dispute relative to the overall operation, and limiting the degree to which we let it influence our decision making. Worry about accomplishing strategic priorities in an ethical manner, not whether a vendor who lost a contract representing a tiny fraction of government spending is making a stink.

 

[FJAG]

The question is when, not if, 2% will be achieved. But major acquisitions do not happen overnight.

Which is a different problem. 2% could be allocated and set aside in a reserved fund designated for a certain line of equipment for when acquisitions actually take place. Yeah. Yeah. I know it's not that simple but it should and could be.

Weren't those UOR's, and UOR's are still projects, which take project time and staff?

Many projects are well developed and awaiting funding. Yes there are still things to be done but most major projects do not have to start from scratch.

 

[dapaterson]

GoC has moved to accrual vs cash based accounting. So paying $100,000 today for a truck that has a lifespan of 10 years mean that the Defence expenditure is $10,000 per year for ten years.

 

[IKnowNothing]

GoC has moved to accrual vs cash based accounting. So paying $100,000 today for a truck that has a lifespan of 10 years mean that the Defence expenditure is $10,000 per year for ten years.

Does NATO count our 20% as our annual depreciation of capital equipment assets or our cash capital investment?

 

[dapaterson]

Which is a different problem. 2% could be allocated and set aside in a reserved fund designated for a certain line of equipment for when acquisitions actually take place. Yeah. Yeah. I know it's not that simple but it should and could be.


Many projects are well developed and awaiting funding. Yes there are still things to be done but most major projects do not have to start from scratch.

That is in fact how it's done. There's a 20 year fund for accrual acquisition.

 

[Good2Golf]

PP needs to resign for a centrist or a Tory that won't be viewed as suspicious or disloyal. PP has become completely toxic politically. I think the Conservatives are snatching defeat from the jaws of victory.

Watching Peter MacKay get scorned twice by the CPC leads me to believe that indeed the CPC may snatch defeat out of the jaws of victory this time around.

To further elaborate, on one fle I am familiar with, TB approved less than half of what Cabinet approved...18 months later. Taking a $250M cut to a Cabinet approved program is a problem......

Because the one or two individuals who direct the President of the Board how to roll it, chose it to be thus…

As I recall the biggest single expenditure is Old Age Security. And seniors vote.

Although it is a statutory expenditure, not voted. Seniors vote, yes…but one could argue the impact they have on existing statutory expenditures.

 

[dapaterson]

I meant, the statute was passed and amended by legislators because they know who will show up to vote them in or vote them out.

 

[ytz]

It's no secret he's using this threat to push us to spend more on defence.

That's not clear at all. He keeps talking about us becoming the 51st state. He has not really linked defence spending to tariffs.

This also means that the government now has to worry about keeping fiscal room to support industry in the event of tariffs.

If Trump was actually clear about linking defence spending to tariffs, than you'd be right.

 

[calculus]

I think we could satisfy the US with something like the following presentation:

1. Look at all the US-built stuff what we have bought recently : F35, P8, Aegis, Spy 7, ESSM, etc..(we could toss Chinook and C130J in there as well, for good measure).
2. Look at what we are planning to buy: E7, Abrams (maybe) M109 (maybe), more SPY 7, more Aegis, SM2, Tomahawk, RAM, NASAMS, MLRS, etc, etc.

I'm not necessarily advocating we buy all these things, but if we had a list of purchases and planned purchases, all from US companies, worth "billions and billions" of dollars, and a clear path to 2% (I would not go any further than 2027), I think that would do a lot towards placating this administration (even if we aren't at 2% by June). It would even be better if we exceeded expectations a bit, and committed to something like 2.3%.

 

[ytz]

Its because they realize to get to where we need to be means cutting social spending and probably foreign aid. And Canadians looooove their social programs.

Alternatively, raise the GST back up by 2%. People can't have their cake and eat it too. Low taxes, comprehensive public services, decent military. Pick two. And at least consumption taxes will hurt business the least.

 

[Czech_pivo]

Alternatively, raise the GST back up by 2%. People can't have their cake and eat it too. Low taxes, comprehensive public services, decent military. Pick two. And at least consumption taxes will hurt business the least.

A 1% increase to the GST will provide an extra 10$ billion/yr - devote, by enshrining in legislation, that this 10$ billion/yr goes directly to CAF funding and its above and beyond existing budgetary outlays.

 

[ytz]

A 1% increase to the GST will provide an extra 10$ billion/yr - devote, by enshrining in legislation, that this 10$ billion/yr goes directly to CAF funding and its above and beyond existing budgetary outlays.

An honest PM would make the case to Canadians that the GST needs to be raised and will be used to bring the CAF to 2% and beyond.

And it's not just the CAF. I have worked with our intelligence partners and diplomats. They are hurting too. Although, they don't need nearly at much as we do. Foreign policy is just a complete afterthought in this country until there's a crisis.

 

[ytz]

As I recall the biggest single expenditure is Old Age Security. And seniors vote.

OAS is on track to hit $100B by 2030. It's at $70B right now. Current projections are for $181B in 2045. If we're aren't going to raise the GST, we need to have honest conversations about OAS.

I always think of my personal situation. With my CAF pension ($60k) and CPP ($17k), why would I need the extra almost $9k per year at 65? It's ridiculous that OAS doesn't begin to get clawed back till you make $86k. And doesn't phase out till $140k. Nobody making more than $70k as a senior really needs OAS in my opinion. And that would include me.

It's even crazier cause these folks are getting pogey they don't need at a point in their lives when they don't have childcare expenses and are most likely to have fully paid off homes.

If we don't fix OAS, it will eat the entire budget and kill literally every other priority this country has. We're debating whether $50B on a train is worthwhile. Or $30B on a pipeline. And those are one time costs. Meanwhile $70B goes to seniors every year.

 

[dapaterson]

Plus, unlike CPP and PS/RCMP/CAF pensions, OAS has zero assets underlying it, it's paid out of general revenue.

 

[ytz]

Plus, unlike CPP and PS/RCMP/CAF pensions, OAS has zero assets underlying it, it's paid out of general revenue.

Incidentally, CPP should actually be much higher. It isn't. And that's part of the problem. Today's generation of seniors didn't make CPP substantial enough. So now they want generous OAS top ups. What was meant to ensure that seniors weren't homeless and eating cat food is now vacation money for those with defined benefit pensions.