armed forces
Canada could cut deal with U.S.—increase defence spending, remove tariffs
From the Fraser Institute
Because we live in dangerous times, and because an honest country keeps its word, Canada should meet its NATO commitment to spend at least 2 per cent of GDP on defence. But there’s another reason to live up to that promise—it’s good for trade.
Countries that are able to defend themselves earn the respect of their allies. That respect can provide tangible benefits. Consider Cyprus and the Auto Pact.
In the winter of 1964, in the depths of the Cold War, violence between Greek and Turkish Cypriots threatened to escalate into war between Turkey and Greece. President Lyndon Johnson, anxious to prevent war between two NATO members, was hugely grateful when Prime Minister Lester Pearson agreed to dispatch a peacekeeping force to the island.
“You’ll never know what this may have prevented,” said Johnson. “Now what can I do for you?” As Pearson noted in his memoirs, “I had some credit in the bank.”
A year later, Canada and the United States signed the Auto Pact, which guaranteed minimum levels of production for the Canadian auto industry. “I believe that Johnson’s willingness to agree to the Auto Pact the next year, an agreement that hugely benefited Canada’s auto sector, may well have been Pearson’s reward for Cyprus,” wrote historian J.L. Granatstein years later.
Canada’s relations with its NATO allies cooled in the years when Pierre Trudeau was prime minister. Trudeau considered pulling out of NATO entirely, but in the end contented himself with greatly reducing Canada’s troop presence in Europe. But Trudeau began to show new respect for NATO when he sought to diversify Canada’s trading relationships. “No tanks, no trade,” West German Chancellor Helmut Schmidt reportedly told him. Trudeau subsequently boosted defence spending and Canada acquired German Leopard tanks.
In the 1980s, as Brian Mulroney sought to improve relations with the U.S., his government maintained defence spending at or near 2 per cent of GDP, even as the government reduced spending in other areas to bring down a chronic deficit. On Mulroney’s watch, Canada retained a robust commitment to NATO and NORAD. In February 1990, former Cold War antagonists agreed to a process for German reunification during the Open Skies conference in Ottawa; six months later, Canada joined a U.S.-led coalition that ejected Iraqi forces from Kuwait.
And in the midst of this stalwart support, Canada and the U.S. negotiated their historic free trade agreement.
Then came the so-called Decade of Darkness, as Jean Chretien’s government cut funding to the military to help balance the budget. In the 2000s, Stephen Harper ensured that the Canadian mission in Afghanistan was properly equipped, but his government further cut spending in the wake of the 2008-09 financial crisis. By the time Justin Trudeau came to power, defence spending was at 1 per cent of GDP.
While it appears Justin Trudeau’s government increased defence spending, part of that is the accounting trick of putting veterans’ benefits in the budget. In fact, Canada remains virtually the sole outlier among NATO members in having no credible plan to get to 2 per cent any time soon.
Last spring, 23 U.S. senators (both Democrat and Republican) issued a letter taking Canada to task for failing to meet its defence commitments. And they spoke plainly. “We are concerned and profoundly disappointed that Canada’s most recent projection indicated that it will not reach its two percent commitment this decade.”
In that sense, Donald Trump was speaking for everyone in Washington when, as president-elect, he told reporters that “we basically protect Canada… we’re spending hundreds of billions a year to take care of Canada.”
That doesn’t in any way excuse the punitive tariffs the administration imposed on Canada and Mexico over the weekend. Those economic sanctions are capricious, vindictive and mutually damaging. Canada had no choice to but to respond in kind.
But it’s also true that other countries no longer take this country seriously. During the Biden administration, the U.S., the United Kingdom and Australia entered into the AUKUS security pact. Canada wasn’t invited. And QUAD security dialogue involving Australia, India, Japan and the U.S. is not QUINT, because we weren’t asked to join.
Canada will have a new federal government within months. Its highest priority must be to restore free trade with the U.S. One way to negotiate seriously with the Trump administration may be to offer a specific concrete program of investment in the NORAD partnership, in exchange for the removal of tariffs.
If the Americans agree, it wouldn’t be the first time that trade and defence were intertwined.
John Ibbitson
From the Daily Caller News Foundation
The global war business scored record revenues in 2024 amid multiple protracted proxy conflicts across the world, according to a new industry analysis released on Monday.
The top 100 arms manufacturers in the world raked in $679 billion in revenue in 2024, up 5.9% from the year prior, according to a new Stockholm International Peace Research Institute (SIPRI) study. The figure marks the highest ever revenue for manufacturers recorded by SIPRI as the group credits major conflicts for supplying the large appetite for arms around the world.
“The rise in the total arms revenues of the Top 100 in 2024 was mostly due to overall increases in the arms revenues of companies based in Europe and the United States,” SIPRI said in their report. “There were year-on-year increases in all the geographical areas covered by the ranking apart from Asia and Oceania, which saw a slight decrease, largely as a result of a notable drop in the total arms revenues of Chinese companies.”
Notably, Chinese arms manufacturers saw a large drop in reported revenues, declining 10% from 2023 to 2024, according to SIPRI. Just off China’s shores, Japan’s arms industry saw the largest single year-over-year increase in revenue of all regions measured, jumping 40% from 2023 to 2024.
American companies dominate the top of the list, which measures individual companies’ revenue, with Lockheed Martin taking the top spot with $64,650,000,000 of arms revenue in 2024, according to the report. Raytheon Technologies, Northrop Grumman and BAE Systems follow shortly after in revenue,
The Czechoslovak Group recorded the single largest jump in year-on-year revenue from 2023 to 2024, increasing its haul by 193%, according to SIPRI. The increase is largely driven by their crucial role in supplying arms and ammunition to Ukraine.
The Pentagon contracted one of the group’s subsidiaries in August to build a new ammo plant in the U.S. to replenish artillery shell stockpiles drained by U.S. aid to Ukraine.
“In 2024 the growing demand for military equipment around the world, primarily linked to rising geopolitical tensions, accelerated the increase in total Top 100 arms revenues seen in 2023,” the report reads. “More than three quarters of companies in the Top 100 (77 companies) increased their arms revenues in 2024, with 42 reporting at least double-digit percentage growth.”
How the 2025 Federal Budget Demands More From Those Who’ve Already Given Everything
I’ve lived the word sacrifice.
Not the political kind that comes in speeches and press releases the real kind. The kind Mark Carney wouldn’t know if it slapped him in the face. The kind that costs sleep, sanity, blood. I’ve watched friends trade comfort for duty, and I’ve watched some of them leave in body bags while the rest of us carried the weight of their absence. So when the Prime Minister stood up this year and told Canadians the new budget would “require sacrifice,” I felt that familiar tightening in the gut the one every veteran knows. You brace for impact. You hope the pain lands in a place that makes sense.
It didn’t.
Kelsi Sheren is a reader-supported publication.
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Six months into Mark Carney’s limp imitation of leadership, it’s painfully clear who’s actually paying the bill. The 2025 budget somehow managing to bleed the country dry while still projecting a $78-billion deficit shields the political class, funnels money toward his network of insiders, and then quietly hacks away at the one department that should be sacrosanct: Veterans Affairs Canada.
If there’s one group that’s earned the right to be spared from government-imposed scarcity, it’s the people who carried this country’s flag into danger. Veterans don’t “symbolize” sacrifice they embody it on the daily And when Ottawa tightens the belt on VAC, the consequences aren’t abstract. They’re brutal and direct, causing nothing but more death and destruction. But Mark Carney doesn’t lose sleep over veterans killing themselves.
Punishment disguised as budgeting for a veteran means the difference between keeping a roof or sleeping in a truck. Punishment disguised as budgeting means PTSD left untreated until it turns a human being into another suicide statistic. Punishment disguised as budgeting means a veteran choosing between groceries and medication because some number-shuffler in Ottawa wants to pretend they’re being “responsible.”
This isn’t fiscal restraint it’s political betrayal wrapped in government stationery. Ottawa sells it as hard choices, but the hardness always falls on the backs of the same people: the ones who already paid more than their share, the ones who can’t afford another hit. Carney and his cabinet won’t feel a thing. Not one missed meal. Not one sleepless night. Not one flashback.
But the men and women who already paid in flesh? They’re the ones being told to give more.
That’s not sacrifice.
That’s abandonment dressed up as fiscal policy.
And Canadians need to recognize it for what it is a government that demands loyalty while refusing to give any in return. The fine print in the government’s own documents reveals what the slogans won’t.
Over the next two years, VAC plans to cut $2.227 billion from its “Benefits, Services and Support” programs. [2] Broader “savings initiatives” reach $4.4 billion over four years, much of it through reductions to the medical-cannabis program that thousands of veterans rely on to manage chronic pain and PTSD. [3] Independent analysts estimate yearly losses of roughly $900 million once the cuts are fully implemented. [4]
To put that in perspective: no other department is seeing reductions on this scale. Not Defence, not Infrastructure, not the Prime Minister’s Office thats for damn sure. Only the people who’ve already paid their debt to this country are being asked to give again.
The government’s line is tidy: “We’re not cutting services we’re modernizing. Artificial Intelligence will streamline processing and improve efficiency.”
That sounds fine until you read the departmental notes. The “modernization” translates into fewer human case managers, longer waits, and narrower eligibility. It’s austerity dressed up as innovation. I’ve coached veterans through the system. They don’t need algorithms; they need advocates who understand trauma, identity loss, and the grind of reintegration. They need empathy, not automation.
This isn’t abstract accounting. Behind every dollar is a life on the edge, the human cost and toll is very real.
- Homelessness: Veterans make up a disproportionate number of Canada’s homeless population. Cutting benefits only deepens that crisis.
- Mental Health: Parliament’s ongoing study on veteran suicide shows rising rates of despair linked to delays and denials in VAC services. [5] Knowing MAID for mental illness alone in 2027 will take out a significant amount of us.
- Food Insecurity: A 2024 VAC survey found nearly one in four veterans reported struggling to afford basic groceries. That’s before these cuts.
We talk about “service” like it ends with deployment. It doesn’t. Service continues in how a nation cares for those who carried its battles, and this doesn’t include the cannabis cut to medication or the fight’s we have to fight when they tell us our injuries are “not service related”
The insult is magnified by the timing. These cuts were announced just days before November 11 Remembrance Day, when Canadians bow their heads and say, “We will remember them.”
Apparently, the government remembered to draft the talking points but forgot the meaning behind them, not a single one of the liberal government should have been allowed to show their faces to veteran’s or at a ceremony. They’re nothing but liars, grifters and traitors to this nation. Yes I’m talking about Jill McKnight and Mark Carney.
The budget still runs the second-largest deficit in Canadian history. [6]
Veteran cuts don’t fix that. They barely dent it. What they do is let the government say it’s “finding efficiencies” while avoiding the real structural overspending that created the problem in the first place. When a government chooses to protect its pet projects and insider contracts while pulling support from veterans, that’s not fiscal discipline it’s moral cowardice. The worst part is that This isn’t an isolated move. It fits a six-month pattern: large, attention-grabbing announcements about “reform,” followed by fine print that concentrates power and shifts burden downward. Veterans just happen to be the first visible casualty.
The same budget expands spending in other politically convenient areas green-transition subsidies, digital-governance infrastructure, and administration while the people who once embodied service are told to tighten their belts.
As a combat veteran, I know what it’s like to come home and realize that the fight didn’t end overseas it just changed terrain. We fought for freedom abroad only to watch bureaucratic neglect wage a quieter war here at home. Veterans don’t ask for privilege. They ask for respect, for competence, for follow-through on the promises this country made when it sent them into harm’s way.
Here’s what really needs to change, the liberal government has to go, thats step one. Restore VAC funding immediately. Any “savings” plan that touches benefits, services, or support should be scrapped. End the AI façade. Efficiency can’t replace empathy. Keep human case workers who understand the veteran experience. Audit and transparency. Publish a detailed breakdown of where VAC funds are cut and who approved it. Canadians deserve to see the receipts. National accountability. Every MP who voted for this budget should face veterans in their constituency and explain it, face-to-face.
Budgets are moral documents. They show what a country values. By slashing VAC while running record deficits, this government declared that veterans are expendable line items, not national obligations. The Prime Minister promised “shared sacrifice.” But the only people truly sacrificing are the ones who already gave more than most Canadians ever will.
Sacrifice isn’t about spreadsheets; it’s about service. It’s what every veteran understood when they raised their right hand. This government’s brand of sacrifice asking wounded soldiers to pay for political mismanagement isn’t austerity. It’s abandonment.
Canada owes its veterans more than a wreath once a year. It owes them respect written into every budget, not erased from it.
KELSI SHEREN
Footnotes
[1] The Guardian, “Canada’s 2025 Federal Budget Adds Tens of Billions to Deficit as Carney Spends to Dampen Tariffs Effect,” Nov 5 2025.
[2] True North Wire, “Liberal Budget to Cut $4.23 Billion from Veterans Affairs,” Nov 2025.
[3] StratCann, “Budget 2025 Includes Goal of Saving $4.4 Billion in Medical Cannabis Benefits,” Nov 2025.
[4] Canadian Centre for Policy Alternatives, “Where Will the Federal Government Cut to Pay for Military Spending and Tax Cuts?” Nov 2025.
[5] House of Commons Standing Committee on Veterans Affairs, “Study on Veteran Suicide and Sanctuary Trauma,” ongoing 2025.
[6] CBC News, “Federal Budget 2025 Deficit Second Largest in Canadian History,” Nov 2025.
Kelsi Sheren is a reader-supported publication.
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