Staples op-ed: Frosty relations between defence lobby and minister

OTTAWA–Defence Minister John McCallum looked distinctly uncomfortable when he attended an arms industry trade show in Ottawa recently. He was likely grateful that there were few reporters present, for he went so far as to demand that the only camera nearby be shut off while he spoke with a clutch of arms industry representatives gathered around a display of missiles.

The trade show, called CANSEC 2003, was held at the Ottawa Congress Centre on April 10 and 11. CANSEC is organized annually by the Canadian Defence Industries Association (CDIA) and is the successor to the controversial ARMX trade show once held in Ottawa, until protests closed it down. The CDIA lobbies the federal government on behalf of its more than 300 member corporations involved in the defence industry.

Now in its fifth year, CANSEC comprised 150 exhibitors and a record 3,600 delegates drawn from industry and several government departments. It was billed as “Canada’s foremost defence and security exhibition,” and included displays of missiles, machine guns, ammunition, military vehicles, battle management computer systems, simulators, and spy satellite technology, all from leading manufacturers.

It also drew protests from about a hundred peace activists, who blocked one of the entrances, resulting in four arrests.

CANSEC is small in comparison to Canada’s typically combined civil and military aerospace trade shows, but its distinctly military focus draws exhibits from U.S. defence heavyweights Boeing, Raytheon, General Dynamics, Lockheed Martin, United Defense and Northrop Grumman. Canadian companies included CAE, Magellan, and MacDonald Dettwiler and Associates.

Defence Minister McCallum’s cameo appearance at CANSEC 2003 is indicative of the frosty relationship between the Minister and the defence lobby these days. After going to bat for pro-defence groups in the last federal budget and winning nearly a billion dollars more in military spending, McCallum was blindsided by what he felt was a distinct lack of gratitude from the defence lobby after the budget was announced.

For example, CAE’s Group President in charge of Military Simulation and Training, Don Campbell, told CANSEC’s luncheon audience that Canada’s increased military spending was “a good beginning, but no substitute for a coherent predictable long-term approach.”

The defence lobby is worried about losing U.S. defence contracts because the Liberals did not come up with the billions more in military spending that was not-so-subtly suggested by U.S. Ambassador Paul Cellucci. Not supporting the war on Iraq didn’t help either.

But despite the corporations? professed angst, the long-range forecast for the Canadian defence industry is nothing but clear skies. According to the CDIA, the overall defence industry has increased by 46 per cent since 1998 and is now valued at $7.5-billion.

The United States typically accounts for nearly half of Canada’s $2.75-billion worth of defence exports. Canada’s defence industry is deeply integrated into the U.S. defence industry, and U.S. military spending will soon surpass $400-billion. Moreover, U.S. spending on new equipment has risen to $120-billion, double what it was in 1997.

In Canada, two factors have sweetened the pot for defence companies: increased military spending and the privatization of military services. This double blessing has created a Canadian defence market worth more than $4-billion, an increase of 22 per cent since 1998.

But growth has not come without criticism. Public interest groups have pointed to Canada’s weak defence export rules, which permit military exports to repressive countries such as Indonesia and Saudi Arabia. They also say exports to the U.S. should be given greater scrutiny to prevent Canada supporting U.S. wars outside of international law or waged through client states such as Colombia.

Domestically, military spending is being driven upward and diverted from more pressing defence needs by lobbying from the ailing aerospace industry, which is seeking military aerospace contracts and help to promote arms exports. For example, Canada committed $150-million (U.S.) to fund the development of a new U.S. warplane, the Joint Strike Fighter, in the hope of winning contracts for Canadian aerospace corporations, even though Canada has no plans to purchase the plane.

Despite this waste, at least two good examples of money-saving solutions to Canada’s defence equipment needs were showcased at CANSEC. Raytheon has partnered with the Canadian Department of National Defence to develop a coastal radar system that will save millions of dollars in expensive air and sea patrols. General Motors Defense is providing the Canadians Forces with military light utility trucks based on the well-known Chevy Suburban; these trucks can be repaired easily at any GM dealership.

It is important that Parliament and policy makers ensure that Canadian industry does not become bewitched by growing military budgets. According to the CDIA, 97 per cent of Canadian arms producers also produce for the commercial market. The government should encourage Canada’s industries to focus on these commercial markets over defence markets. This will ensure that companies do not become dependent upon perpetual publicly-funded military contracts, or even worse, arms exports.

After all, Canada’s high-tech aerospace industry is one of the world’s best, as proven by the success of Bombardier’s regional jets. The secret of Canada’s success is that we decided long ago to focus on building passenger planes — not war planes.

This article by Steven Staples was published in The Hill Times on April 21, 2003.