Comment by hylaride

Comment by hylaride 8 months ago

9 replies

By that argument we should do that with everything. Maybe...with tariffs? /s

Doing that is more expensive and means we get us less for more - and we'd almost still rely on other countries for components and resources. All being equal, it is better to buy foreign goods cheaper and then have money leftover to focus on investing what you're good at. Canada is too small to economically fully design and build a modern plane, engines, missiles, radar, etc to compete with the US, China, etc. We certainly can't afford to do that with everything else, as well.

There are absolutely overriding strategic and security reasons you may want to do some of this anyways, but as a general rule we'd be far better diversifying our defence alliances (eg buying a mix from France, Korea, Japan, US, UK, etc) plus having something really good to offer said allies so we can be interdependent. Countries (including the US as we're learning) are not more powerful when they go it alone.

Protected industries almost always get lazy and noncompetitive. Canada is building our own version of the Type 26 frigate for almost double the cost per boat of Australia and the UK (which already ate the design costs!) despite the fact that we're going to be building the most of them so we should in theory scale cheaper. There are some reasons for that (they will be the most capable type 26's afloat), but it's mostly just because the government wants to subsidize Irving and east coast shipbuilders and there's no real scale or expertise because they literally can't market their work outside of Canada.

lupusreal 8 months ago

The argument is that naively looking at the price tags of domestic and foreign weapon systems doesn't tell you the true costs to the country. A dollar given to a foreign country costs much more than a dollar spent inside your own economy.

This is hardly even a novel or controversial point. Any defense spending expert will tell you this. Even that trendy Perun guy that reddit loves has made this precise point.

  • hylaride 8 months ago

    If this were true, Argentina would be super rich and Singapore would be super poor.

    But it is not because just “keeping a dollar in your country” chasing less productive work/goods causes productivity and competitive problems the more it happens and longer it goes on.

    There are plenty of defense experts who’ll say the opposite of what you say they will (though they’re open to exceptions for security reasons).

    It is better to buy cheaper/better stuff abroad and have others do the same for your competitive stuff.

    • lupusreal 8 months ago

      You are being deliberately obtuse. Investing in domestic production isn't an infinite money hack, that isn't the argument. The argument is that you cannot make a apples-to-apples dollars-to-dollar price comparison to see how much it will cost your country to outsource production of hardware. With the benifit of hindsight, we know that Diefenbaker's decision spelled the death of Canada's aerospace industry. Their engineers moved to America or left their careers behind. The cost to Canada of buying American jets was considerably more than the sticker price of those jets.

      • hylaride 8 months ago

        > You are being deliberately obtuse

        You’re giving vague responses with no data to back it up, so that’s a rude statement.

        > The argument is that you cannot make a apples-to-apples dollars-to-dollar price comparison to see how much it will cost your country to outsource production of hardware

        Yes you can. The F-35 flyway costs ($82m) are similar to the Saab Gripen ($85m) despite the F-35 being superior in almost every way (the one notable exception being the Gripen is good at flying off of more rustic environments). The simple reason is scale. There are similar numbers for French planes and they’re finally giving up for their next-gen planes and working with the rest of Europe. Sweden is all but throwing in the towel going forwards, too.

        You’re essentially saying Canada should pay more for less to support jobs and expertise that will produce less and cost more.

        Canada has been a net contributor in the F-35 program (as have most of the other countries that have purchased it).

        > With the benifit of hindsight, we know that Diefenbaker's decision spelled the death of Canada's aerospace industry

        Canada has the third largest aerospace industry after the EU and USA (though we go toe to toe with Brazil). Your argument is invalid.

        > The cost to Canada of buying American jets was considerably more than the sticker price of those jets

        This is not true, though the numbers are fuzzy depending on if one includes R&D and number of planes built - so we could spend all day arguing on this. But the engines were languishing in development hell, so we ultimately didn’t know what the final bill would have been (the TV series show them as “this close” to being done, but that wasn’t the case in real life).

        The Avro arrow was a really good long range interceptor, but that was about it. The CBC miniseries made it out to be this amazing plane that was better at everything, which it was not. The Voodoo that was bought instead was arguably inferior in policing Canada’s north, but was much better suited for all the other roles the Air Force participated in, especially European NATO commitments. We would have had to buy another plane anyways, but the one plane already stretched Canada’s resources. We’re just not big enough to do that.

        > Their engineers moved to America or left their careers behind. The cost to Canada of buying American jets was considerably more than the sticker price of those jets

        There absolutely was a brain drain to the US for many of the engineers. As I mentioned in another post, cancelling the Arrow was arguably the right decision for the wrong reasons, but because it was done for the wrong reasons there wasn’t any thought put through on focusing on another project. A huge chunk of the blame lies with the executives at avro canada, who over-extended trying to do everything (plane, engine, etc) and then got burned playing with politics.