Let's talk briefly about NATO spending

Ahead of NATOs big meet-up later this month Minister's were in Brussels for a small, yet still important meeting together.

There is a lot thats expected to come out of the NATO Summit on the 24th/25th of this month. We already have agreed upon capability targets agreed to as of yesterday

These targets, according to NATO Secretary General Mark Rutte:

“describe exactly what capabilities Allies need to invest in over the coming years… to keep our deterrence and defence strong and our one billion people safe.”

These targets will likely never come to the public as they are considered classified. Certainly you will never hear them from me but they do set the stage for the big thing.

NATO is moving to 5%. While not fully agreed on, the setup is there and an ever increasing voice of support across the alliance is quickly setting the stage for it to come to fruition.

Of course further discussions on capability targets, the breakdown of 5% and timelines will be decided upon at the summit, so things are a bit fluid. We do know that the initial idea would see members commit to 3.5% in actual defence spending and 1.5% in defence and security related investments.

To Quote Mr. Rutte again:

“We need more resources, forces and capabilities so that we are prepared to face any threat, and to implement our collective defence plans in full. We will need significantly higher defence spending. That underpins everything”

To his credit Mr. Rutte has been pushing for the 5% target for a long time. He has been pushing for beyond 2% since before the Trump administration set the 5% mark themselves and decided to run with it.

For Canada this target represents a major shift, not just in what it provides financially, but also to a shifting alliance that very clearly will not accept below the minimum as we have been.

Canada exists in several catagories below just spending in dollars. We also spend below the desired 20% for equipment expenditure, a second very much less discussed figure that is also agreed upon by NATO.

While the 2% agreed upon at the Wales summit in 2014 had little tied to it in terms of actual plans or commitment this new agreement is looking to be much more serious.

While not set in stone the new agreement will likely include hard deadlines and a requirement for members to present a plan, and yearly updates on how it plans to increase spending to five percent.

As of right now we dont know when exactly it will be. I have tried to dig but sadly my NATO connections are distant and minimal. The two dates I have heard are 2032 and 2035. Both are reasonable dates to expect as many alliance members already use them in planning.

There is active push for either date by members. Quite a few want to see 2035 set as the date, to provide some extra time. However NATO itself seems to want to push for more with 2032. It will be at the summit where we will see which number pulls through.

As for Canada? Things are still in the works. These general consensus that I have seen is that the Liberals will commit to five percent if agreed upon, and will commit to meeting the deadlines.

To their credit they do seem to be taking this seriously, with active debates already being done on pushing ahead of their own promised commitments to reach 2% even quicker than 2028/2029 as expected. (Potentially as soon at next year 👀)

McGuinty somewhat teased this in Brussels when he said that there was currently a ‘top and bottom’ review happening and that announcements would come soon.

Truthfully there is likely some waiting on what the set-in date to reach 5% will be, as well as clarification on what counts towards defence-related investments.

Truthfully Canada could be very lucky in that regard, being able to leverage investments in Critical Minerals and energy could be a very easy, quick way to tack on that 1.5% of investment spending. That depends though on what is allowed.

Before the NATO summit though Prime Minister Carney will also meet with Mr. Rutte at the G7 Summit in Kananaskis, Alberta. This was confirmed after a discussion between the two today and comes just over a week before the NATO Summit.

To the observer this would appear to be leading to a major setup, with announcement teasing, several high-profile meetings, and the summit coming in less than a month.

We had similar announcements at last year's summit, primarily in regards to submarines. It is very likely that either at or just before the NATO summit we will see the Liberals present their new, updated spending plan.

We are to late into the current sitting of parliment for any meaningful legislation to be passed for defence, not that I truly expected it. If the Liberals wanted to make big on their defence promises early than presenting a five percent plan would be it.

The big hold-up right now seems to be tied to timelines. Certainly ive heard that we would prefer a 2035 date. I dont think that would surprise anyone.

I await to see how committed this government truely is. If you were to take Canada's current GDP a 3.5% commitment to defence would be a staggering $77 billion per year. That is an absolutely mind-boggling amount for us to be spending.

Now there are certainly high ticket items, like Submarines, housing, infrastructure thay could chip large amounts of that away, especially if we are true to procurement reform.

Yet, as always, people love defence when they are scared but quickly turn against it once almost anything comes up. I have long spoken that I dont expect the current wave of nationalism and sovereignty pushing to last. I dont think two years from now people will be as willing to spend on defence as now.

It is why I have long pushed for things to be done now, while public opinion has given the mandate to make radical, even costly changes. There is no better time than now.

However in two to three years? When the next Democrat is in office? Where will the public opinion be? When other things come to pass, and people make new demands, where would it be easiest to cut if not defence, as we have always done.

Defence is easy to cut. The public has allowed it for decades. When the financial Hawks come circling it is bound to be one of the first thrown at the sacrifical alter.

Will the public be willing to spend nearly a hundred billion on this in three or four years? I doubt it.myself, yet NATO is seemingly leaving little choice in that matter.

Its a pay to play system now. Those who dont risk not only being left behind but pushed out entirely. Canada faces the unique position, seemingly away from the conflict to the public eye yet still held to the same standard.

I am not insinuating that Canadians would want to leave NATO on mass or anything but I do feel like this will be a ticking bomb to a larger public probelm down the road.

What we do have now though is the time and mentality to convince people that defence is a worthwhile investment. Do it while you have their attention and support.

That is something I have been urging forever, and something ive been planning to do more of. It is something I encourage those of you in CAF, PSPC, and other public positions to do. I will even say that industry needs to step up and get the message out more.

We are potentially heading into a quiet period before a very packed Fall with budget, reform, and restructuring coming in the span of likely a three month period.

During this potential downtime it is up to you, me, others who csre to keep the topics and conversation active and going. We get no where by being pushed to the back of the news cycle, and certainly dont win favors by not treating the situation as serious and urgent.

So get out there, be proactive, be social (which I know for many of you is hard) and most of all be talkative. Engage with the community, with ordinary people. That is how you prevent this looming issue for existing in the first place.