Thursday, October 31, 2013

The Ship Has Sailed

J.L. Granatstein has a strong piece arguing that Canada should not be resurrecting the long dead ship-building industry via the recapitalization of the Royal Canadian Navy and Coast Guard.  He is dead on, arguing both buying foreign-made ships will be far cheaper and that future governments are likely cancel expensive programs.  So, better to buy the cheaper foreign stuff and get good replacements now than spend years and billions of dollars on ships that may not be completed.

A key point he makes is that if Canada bought foreign ships, there would still be Canadian jobs to be had for putting into the ships various technologies.  The problem is it is one thing to say: new foreign-built ships with a few thousand domestic jobs.  It is another thing to say: let's cancel the contracts which have 15k jobs attached and then buy cheaper foreign ships with a few thousand domestic jobs.  Path dependence is a bitch, and reversing course now would be very costly politically. 

What makes sense for Canada does not make sense for the Conservative Party, alas.  So, while Granatstein is right in his analysis, it really does not matter.  Defence procurement as industrial policy--propping up Canadian industry--means more wasted tax dollars on less capability.  The government that claims to be careful stewards of Canadian tax dollars is going to make the choice that is best for them politically--getting votes in British Columbia and Nova Scotia--and bad for teh budgets of tomorrow.

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