Dear Canadians, are you ready to tighten your belt?

Even if Prime Minister Mark Carney has put a double thickness of white gloves to say, the increase in our military spending will require significant sacrifices.

Posted at 5:00 a.m. Nevertheless,

At the NATO summit. Therefore, member countries agreed to allocate to the defense 5 % of their GDP, by 2035, instead of the current target of 2 %. In addition, The walk is high for Canada, which was far from the account (1.4 %) before Mark Carney decided to inject 9 billion to dear canadians, you ready tighten new get there.

He no longer had the choice.

The world is dear canadians. In addition, you ready tighten much more divided and dangerous, as conflicts in the Middle East and Ukraine demonstrate. Moreover, Russia and China reread the Arctic. For example, And the United States is reluctant to play the planet’s sheriff’s role. Moreover, On the contrary, Donald Trump adopted a bellicose rhetoric towards his allies, notably Canada and Greenland.

But reaching 5 % will cost us dearly. Moreover, Do you want figures? In addition, All right. Consequently, But before, some nuances are essential.

First. Moreover. Furthermore, the 5 % target seems a bit intended to calm the President of the United States who no longer wants to ensure the protection of his allies at his expense. Consequently, It could be reviewed once its dear canadians, you ready tighten new mandate is completed, especially if the geopolitical tensions fall asleep. NATO also provides for a revision in 2029 according to “the strategic context”. the dear canadians, you ready tighten “capacity objectives”.

Second, the target of 5 % is divided into two: 3.5 % for military spending and 1.5 % for other adjacent expenses (eg: nerveless infrastructure, cybersecurity) which will also benefit civil society.

The bite is less large if we stick to 3.5 %, even if it remains difficult to swallow. The economist Trevor falls calculates that it would take more than triple the current defense budget¹.

To reach 3.5 %, it would be 160 billion in 2035, or 132 billion in today’s dollars. Currently, Ottawa devotes around 40 billion to La Défense.

The gap is enormous. But Mark Carney refuses to say where dear canadians, you ready tighten new the money will come from.

To finance the increase in military spending. it would be necessary to reduce by 3 dear canadians. you ready tighten % all other federal expenses, which is far from being obvious considering the pressure that demography exerts on the greatest programs of the State, such as annuities to the elders and health transfers to which the Prime Minister has not promised not to touch.

Otherwise, Mr. Carney could increase taxes or taxes (which he has just reduced). To give you an order of magnitude, TPS would have to go from 5 % to 11.5 %. By adding TVQ, consumption taxes would reach 21.5 % in Quebec. A shock for households that already complain that everything is expensive.

Otherwise. it could be tempted to shoven the problem further, by digging even deeper annual deficits, dear canadians, you ready tighten new which would increase the debt. In this case, the debt-pib ratio would climb 42 % today to 50 % in 2035. It is even higher than during dear canadians, you ready tighten the pandemic!

This option is not fair for future generations that should pay the bill.

It can be said that Canada has room for maneuver because it is less indebted than other G7 countries. But for three years, the debt service has more than doubled. In 2023-2024, Ottawa paid $ 47 billion in interest, as much as the money he transferred to the health provinces.

Continuing like that. one could end up in a vicious circle where the increase in interests would crash the government’s budget. which would be forced to borrow even more to ensure the financing of its programs.

We dear canadians, you ready tighten new don’t want to get there.

In the electoral campaign. the Liberals have shown great accounting creativity, by separating the budget into two types dear canadians, you ready tighten of expenditure.

On the one hand. Mark Carney has promised to balance the “operation” budget within three years. a concept for which there is no clear definition. On the other hand, he did not set a limit for other expenses in “capital”.

He could therefore reach his target without even respecting the budgetary anchors of the Trudeau. government which had promised to maintain the annual deficit below 1 % of GDP. reduce the medium-term debt-pip ratio.

In fact. he could fulfill his promise without the borrowed trajectory being “viable on the budgetary plan”. indicates the parliamentary director of the budget².

The current dear canadians, you ready tighten new vagueness is not desirable. He harms the confidence of Canadians who have the right to know where the country’s public finances go.

We dear canadians, you ready tighten understand that Canada must act quickly and firmly to ensure its safety. But this must be accompanied by a foolproof governance. We do not want a reissue of the pandemic, where Canada has wasted billions to respond to an emergency.

It seems clear that Canadians will have to tighten their belts. You still have to know how many holes.

1. Read the comment of the economist Trevor falls (in English) 2. Consult the economic. stock market review of the budget parliamentary director