More Than We Want, Less Than We need
…Canada has a small military, so it will always be a limited market for Canadian producers. Sure, some Canadian companies do well in international competition, which means that they can compete well at home. But many do not, and have not.
The best/worst example of this is ship-building. The effort to re-capitalize the Royal Canadian Navy by building ships in Vancouver and Halifax is mighty good for those shipyards, but is awful from a budgetary standpoint. There are other countries that could have sold Canada more capable, less expensive ships than what the Canadian shipyards will eventually produce. Sure, the ship-building competition within Canada was lauded at the time for being fairly systematic, but it was gamed—the competition was only among Canadian shipyards. Sure, the RCN learned not to buy used ships from the British due to the sub fiasco, but there are companies beyond Canadian shores that could provide excellent ships sooner and for less [see also this post: "Tony Rodger- The Price of Efficient Naval Construction is Practice: Why Canada cannot sustain a naval shipbuilding industry"].
Why? Because Canada is making a huge mistake—it is turning defence contracting into an exercise in domestic job creation…
…while we often think of the military-industrial complex as a single entity pushing in the same direction, it is very clear why the Canadian Forces and Canadian defence contractors do not see eye to eye on spending defence dollars in Canada to subsidize some companies and win some votes.
Lots more on the looming shipbuilding disaster here—through which the Canadian Coast Guard in particular (though not an armed service like the USCG) is getting screwed.
Mark Collins, a prolific Ottawa blogger, is a Research Fellow at the Canadian Defence & Foreign Affairs Institute