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At the same time there are plenty of reasons why Canada might decline. It is entirely plausible that Canada has different strategic needs. It is also true that Canada has already put considerable resources into modernizing its air force. Perhaps then Canada would simply not be interested in naval procurements and thus would have no reason to pool resources.
Canada has rejected the British offer, but not for any of the reasons that I just suggested. The Ministry of Defense refused to cooperate with Canada’s ally to protect its corporate welfare program:
"This government is fully committed to getting the right equipment for the Canadian Forces at the right price for Canadians, with the right benefits for Canadian industry — in this case building new ships in Canada," [Minister of Defense’s spokesman] said. [Emphasis added]Military procurement should not be a jobs program. The goal of any procurement should be getting the best available product for the cheapest price. If South Africa can make ships better and cheaper then that is where Ministry of Defense contracts should go. The government is essentially arbitrarily picking the losers and winners in the market place.
I have to doubt the federal government’s commitment to free trade when they reject a proposal that could potential safe money because of industrial interests.
3 comments:
Just to play devil's advocate here - this is the Canadian government we're talking about, which means that they're a body who taxes Canadians. Wouldn't it make sense to include the tax revenue gained by building in Canada into the cost calculations? For example, let's say Canada wants to build a new super-battleship, the HMCS Maple Death, and they get price quotes of a billion from a Halifax shipyard and $900 million from a Johannesburg shipyard. South Africa looks cheaper, but the Halifax one would have workers who pay taxes in Canada in the sum of, let's say, $200 million. Isn't the Canadian shipyard thus actually a better deal for the Canadian taxpayer? Yeah, the outlays line is higher, but net costs are lower.
Anon,
I am not totally hostile to that reasoning, although I am somewhat suspicious of it. You would have to demonstrate to me with pretty convincing calculations that it will actually work like that. You would also have to demonstrate that the company and people would have been paying relatively lower taxes if it wasn't for that deal.
But at any rate your point doesn't address my concern about the MofD's decision. They are refusing a cost saving proposal on the CHANCE that it may mean less money for their chosen companies. They are absolutely refusing to even look at the alternatives.
They call them free trade deals but I think they are more accurately called managed trade deals.
Given this government's support for marketing boards is it surprising that they are content to squeeze more money out of the taxpayer for defense procurement? It's just another welfare program. Why don't the Canadian shipyards refuse the welfare and insist on fair competition? Why do they think that they are entitled to pick the pockets of Canadians? Why have we turned into a people who find dignity in welfare and government intervention?
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