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The cancelling of the Boeing purchase, likewise, while an obvious money-saver — used jets are cheaper — is unprecedented in subordinating the needs of national defence to the prosecution of a private trade dispute. As an attempt at blackmail it is also spectacularly unwise: there is no indication Boeing has any intention of withdrawing its suit, and in any case Canada has an interest, as the smaller party in any dispute with the United States, in maintaining a rules-based approach to its resolution.

But it is the proposed new rules governing military procurement that are the silliest part of this shemozzle. Procurement has long been disfigured by attempts to attach local content requirements, such as the notorious Industrial and Technological Benefits (ITBs), in an attempt to rope international arms manufacturers into the dubious project of propping up the Canadian defence sector.

Or rather, to pretend to. The burden of such disguised subsidies is almost certainly not borne by the contractors, who compete for capital on international markets and can ill afford to hand out freebies. Rather, it is priced into the contracts. As such, it is subject to the same criticism as any other industrial subsidy. The cost is borne not only by the taxpayer and/or the military, but by other sectors of the economy, from whom capital and labour are thereby diverted.

The 'capability gap' suffers from a pronounced credibility gap

Now the government proposes attaching still another non-military condition to future military purchases, starting with the $19-billion fighter jet contract. The details have yet to be revealed — or, it would seem, written down — but apparently it would involve some sort of test of every competing bidder’s “overall impact on Canada’s economic interests,” assessing their “economic behaviour” in the years prior to the contract being awarded. “Bidders responsible for harming Canada’s economic interests,” the government warns, will be at a “distinct disadvantage.”