Canada’s two-year window to decide on climate justice or militarism

Published by Brent Patterson on

It is possible that the world could see a decrease in spending on weapons due to the drop in the price of oil, pandemic related debt, and a popular push for public funds to be spent on health care and the environment rather than increasingly on armaments.

On May 18, The Guardian reported, “Saudi Arabia is facing an unprecedented budget crunch because of the collapse of the oil markets and the global economic turmoil caused by the Covid-19 pandemic, which has reduced oil demand for the foreseeable future. …Saudi Arabia may be forced to forego new weapons contracts and delay already-agreed weapons purchases as a financial crisis grips the kingdom, experts predict.”

Bruce Riedel of the Washington, DC-based research group Brookings Institution, says world oil prices need to be at about $85 a barrel for Saudi Arabia to maintain its budget. While the price fluctuates, West Texas intermediate (WTI), which is used as a benchmark in oil pricing, now stands at about $32 per barrel.

Given these plummeting oil prices, Andrew Smith of the UK-based Campaign Against Arms Trade says that Saudi Arabia may in the short term put off committing to some larger purchases, like buying a new set of fighter jets.

Guardian columnist George Monbiot also recently argued that the pandemic means that the United Kingdom should not be acquiring 138 new F-35 fighter jets.

Might there be similar implications in Canada?

Fraser McKay, a vice president at the global consultancy group Wood Mackenzie, says that extraction in the tar sands in Canada requires a price of $45 per barrel Brent, another leading global price benchmark, just to cover the cost of production. Again, that price varies, but it now stands at about $34 per barrel.

That will mean a hit for the tax revenue generated by the oil and gas sector. The Canadian Association of Petroleum Producers lobby group has boasted that the sector generates approximately $8 billion annually in revenues to governments. (It doesn’t tend to add that Canada provided almost $60 billion in subsidies to the fossil fuel industry in 2015 according to the International Monetary Fund.)

In late March, Canada’s parliamentary budget officer forecast a federal deficit of $112.7 billion in the current fiscal year, $89.5 billion more than predicted, as a result of pandemic related stimulus and relief programs along with dropping tax revenue.

Meanwhile, the Canadian government has previously committed to increase spending on the military from $18.9 billion in 2016-17 to $32.7 billion in 2026-27, with total spending over a 20-year period of $553 billion on a cash basis.

A key pillar of that spending is the planned purchase of 88 fighter jets that would cost $19 billion plus up to $300 million a year to service.

The deadline for the transnational corporations bidding on the jet fighter contract has now been extended by the government – at the request of industry – to July 31, 2020. The government will announce its decision in 2022.

The government’s timeline on the fighter jets suggest a two-year window in which a decision will be made between public funds being spent on peaceful, green purposes and the need to rethink unconstrained military spending.

It has already been well argued that anti-militarism needs to be at the core of a Green New Deal and that a choice needs to be made between spending billions on weapons or windmills. The contrast could also be made that $17.6 billion on public transit could create 223,000 person job years while $19+ billion on fighter jets could mean 50,000 jobs.

Elliot Hughes, a senior advisor at the Ottawa-based Summa Strategies, has already observed: “The soaring deficits [associated with COVID-19 spending] will place tremendous pressure on government to reduce its spending in non-COVID-19 areas in favour of healthcare and related priorities.”

The question of militarism/extractivism or environmentalism perhaps rests with the capacity of the peace and climate justice movements to effectively voice concern and mobilize together over the next two years on the issue of fighter jets.

Peace Brigades International is committed to making space for peace through the accompaniment of at-risk human rights defenders and environmental activists, peace education, and building on the heritage of nonviolent action that tells us that peace is more than the absence of war, but the presence of justice and the absence of fear.

You can find us on Twitter at @PBIcanada.

Categories: News Updates

0 Comments

Leave a Reply

Your email address will not be published. Required fields are marked *