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One of the less-reported but perhaps more significant comments made by former Prime Minister Brian Mulroney in his 30 January, 2018 appearance before the US Senate Committee on Foreign Relations highlighted the critical relationship between Canada’s economy and its ability to contribute to continental security. Lee Berthiaume of the Canadian Press reported on it in a piece picked up by Postmedia, but neither the CBC nor the Globe and Mail appear to have taken note of the remarks in their reporting. Here is a brief extract from Mr Berthiaume’s article:

“One of the key themes in Mulroney’s testimony was the role that Canada plays in assisting the U.S. with its national security, whether by protecting its northern border or in its fight against the Islamic State group.

But the prime minister said such assistance is contingent on the strength of the Canadian economy, which is highly reliant on its trading relationship with the United States.

“And if that is amputated from our relationship, our co-operation in security and in (ISIL) and in the military and NATO and NORAD, all of these things is lessened,” Mulroney said.

“Because it diminishes our wealth and our capacity to contribute to joint or trilateral endeavours.”

Mr Mulroney’s message was of course tailored for his American audience, so it did not go into all of the implications for Canada of the connection between economy and security. The purpose of this commentary is to briefly summarize this larger picture.

Canada’s security and economy are inextricably linked. The nation’s ability to assure its security and defend its sovereignty is highly dependent not only on political will and action, but also the economic capacity to afford the investments required to shoulder its fair share of continental security, however that is defined among the three North American nations.

Over the next five years, the International Monetary Fund (IMF) is predicting between about 3.5% and 3.8% annual growth in Canada’s GDP, while the US is expected to grow at a rate between about 3.7% and 4.8%. The differential in GDP per capita growth (a common measure of productivity and economic efficiency) is projected to be even greater, with Canada hovering between about 2.4% and 2.7% annually while the US is expected to be between about 3% and 4%. This difference is not new. In 1980 Canada’s GDP per capita was roughly 90 percent that of the US, but by 2017 it had fallen in relative terms to about 75%. Without NAFTA having come into effect in 1994, the numbers would undoubtedly be even worse.

This increasing gap has been the source of warnings by economists for years, most recently the Finance Minister’s Advisory Council on Economic Growth. It represents an insidious threat in that its impact only becomes evident over the long term, and it has significant downstream implications not only for our economic relationship with the U.S. but also for Canada’s sovereignty. The U.S. will quite legitimately do what it must to defend itself and its maritime and air approaches – which by and large are also Canada’s maritime and air approaches – so as Canada falls further behind the U.S. in our national capacity to acquire and sustain the means to assure our security, defend our sovereignty, and meet our continental security commitments, we gradually become a security dependant of the U.S. – at the cost of our sovereignty.

We have seen a similar trend within the lifetimes of many living Canadians. The Canada that contributed so significantly to the creation of the post-war world order – the foundation of the United Nations, the creation of NATO and NORAD (and giving them a meaningful share of the initial teeth needed to be effective), the development of then-innovative international mechanisms such as peacekeeping – has lost much of the national capacity and influence it had to do so and stepped back in recent decades to become a more marginal player. The retrenchment has to this point been somewhat less felt in our continental defence commitments, as successive governments have recognized the need for some level of minimum bottom line contribution there, however as we continue to fall behind our North American neighbours in economic capacity our ability to keep up as a meaningful continental security partner will inevitably continue to erode.

The fact that the process is slow, and change therefore largely imperceptible year-over-year, does not alter the fact that the impact will be significant over time and it is future generations that will have to live with the security and sovereignty consequences if we fail to change the trend lines. Part of the solution is clearly a modernized NAFTA, hence the value in the bipartisan and multi-generational effort by Canada to achieve that end. However, NAFTA will clearly not solve the problem on its own.

 

Colonel (Retired) Charles Davies is a CDA Institute Research Fellow.

Note: This article contains some edited extracts from other work by the author to be published in the near future.

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