Harper's Secrecy-First Defence Policy: A reader writes

If the Prime Minister is to be discouraged from dumping major policy documents onto the Internet in the middle of the night at the end of the session six weeks after they should have been ready, the only thing that will do the trick is the knowledge that such clandestine behaviour will not spare him the journalistic scrutiny he is clearly trying to avoid. My own poor effort was not going to do do it. And I am sad to say that after a spate of early stories simply recording the fact of the late-night document dump, Harper’s instinct has been confirmed by a near-total lack of journalistic scrutiny. (The Ottawa Citizen‘s David Pugliese, as is almost always the case, remains the honourable exception. Here is his blog post on the defence plan. I suspect more is on the way.)

So I was really grateful to get an email this morning from Inkless comment-board regular MikeG, who — puttering in his spare time on a sunny weekend — has produced the most detailed analysis of the Harper defence plan’s spending projections that I have seen. He even made charts and graphs. And what they show is curious: while $490 billion sure looks like a heck of a number, it amounts to a gentle budgeted decline in Canada’s defence effort, compared against major allies, over time.

That may be appropriate. It certainly clashes with the brassy rhetoric of the policy document. It’s the sort of thing we could reasonably stand to talk about, among ourselves, as Canadians concerned with the nation’s public business. But the prime minister would rather that conversation didn’t take place. Too many of us reporters, while tut-tutting his manner, have helped him achieve his end. I’m grateful to MikeG for the work he’s done. Here’s MikeG’s email:

I was going to make a comment yesterday about the new defence budget/plan, but I realized I’d like some numbers to back it up. One thing led to another, and now I not only have numbers, but charts and graphs.

Long story short:
“Defence First” annual, nominal raise in budget: 2.7% (4.2%, 11%, then 2% for 18 years)
Annual Increase in Real GDP: 1.8 – 2.5%, depending on the forecast scenario
+ Annual Inflation (Using the CPI): no less than 2.0%
= Annual Increase in Nominal GDP: no less than 3.8 – 4.6%

… which means for every year we’re on this plan, aside from the boost years (conveniently, the next two), the military budget, as a % of GDP, goes down. Every year (aside from the first two) that inflation is above 2.0%, the spending power of the military goes down. % of GDP as a measure of military spending is not necessarily the end-all be-all of policy-making (Andrew Coyne, for instance, might point out that it sucks), but it’s used in a lot of decision making (at NATO, for instance), and makes headlines.

You could just go look at the graph now, but just so the methodology is clear, here is a hopefully-comprehensible overview of what I did.

The defence budget, as it is, is raised automatically at 1.5% per year. The Defence First plan, in whole, seems to consist of the following:
– An extra $1.8 billion in FY2010-11, and
– the 1.5% automatic raise is changed to 2.0% in FY2011-12.

We already know (from the numbers in the government’s Main Estimates) that FY2007-08 spending for Defence is $16.9 billion, and FY2008-09 is $18.3 billion. Putting together today’s numbers, together with the above boost and raises-as-usual, gets us to 2027, and a budget of $28.9 billion, a total 20-year spend of $479 billion. A little bit short of $30 million / $480 billion.

But, the plan mentions, “the Government increased defence funding through Budget 2006 by $5.3 billion over five years, including [the] baseline increase of $1.8 billion starting in 2010–11.” Despite going through a number of old budgets and main estimates documents, I can’t find what the FY2009-10 spending is supposed to be, or the specific details of that $5.3 billion.

However, if you add a $485 million boost to FY2009-10, everything lines up – final budget for the 2027-28 year is $29.6 million, and the total 20-year spend is $489.981 billion. Definitely close enough for government work.

Armed with those numbers, we can determine the real estimated budget numbers for defence through each of the 20 years. Then, using recently-released long-term economic forecasts (there have been a few done recently, primarily to help figure out how Canada will do with future energy issues) we do a little math and find out what, in then-current dollars, the national GDP should look like.

Even if the forecasts are off a bit here, it’s okay — we’re being conservative. We lowball inflation (2.0%, per Bank of Canada targets) so we can lowball the nominal GDP, which means we’re overestimating the % of GDP that would be spent on the military. Even if CPI is not the best measure for military buying power, that’s okay too, the important thing is having some sort of number that we pop up by 2% a year.

The attached Excel file contains a list of sources, with URLs. I don’t know if it’ll be useful for anything, but, hey, pretty graphs.

I’ll spare you the Excel file, which is an extraordinary thing, but here’s MikeG’s graph. Please note that it would get MikeG kicked out of Graphing U, because it plots a time series — the Harper spending plan, under three different economic-growth assumptions — against a static data set, which is how much France and Poland and Australia and the others are spending on defence now. But I don’t think anyone will have any trouble decoding it. And it sums up the reasons for the Harper government’s late-night, end-of-session, no-comment, weeks-after-the-event document dump rather eloquently:

Hmm. I’m having trouble embedding the pretty image. Here’s a link to MikeG’s graph.

Now, this is an easy plan to defend against opposition parties: Does anyone expect Liberals or the NDP to spend more than Conservatives on defence? It may even be a defensible policy on its own terms: why does a growing society need to grow its armies as fast as it grows, say, its universities or its fleet of WalMarts? But it clashes rather starkly with this government’s bellicose rhetoric. So it embarrasses the prime minister.

I’ll close by pointing out that a defence policy isn’t only a policy for spending. It’s a set of choices about what that money will buy. Since we’re all planning to snooze on that set of choices in the Parliamentary Press Gallery, perhaps Inkless readers will care to read the policy themselves and discuss the choices the Harper government has made.

Democracy: not only can you do it yourself, I’m afraid you’re pretty much going to have to. Thanks once again to MikeG.

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