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5. The "Oerlikon Affair"  Canada's Naval Fleet
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TWRV1-ISSUE: 7. (JULY 22) 1987


The paradoxical question, "Against whom do we defend the Canadian Arctic?" is oft repeated by wags who muse the burgeoning debate between Canada and the United States. This conflict may become an all out diplomatic war as Americans begin to realize the impact of the combined significance of Canadian plans for; the class 8 Polar Icebreaker, space based surveillance systems, increased long-range air patrol capability, modern underwater and surface sonar, expanded Canadian Ranger operations, a High Arctic training center, and a nuclear-powered submarine fleet. 

Content to accept military dependance upon the U.S. in past years, Canadians seem now to have changed their views. Canada's new defence policy White Paper has announced steps that will soon make Canadians pertinent to their own sovereignty. And the Americans are shocked. The most potent and controversial element of this enforced jurisdiction is the fleet of nuclear-powered submarines for Pacific, Atlantic, and Arctic operations. This awakened desire for the self defence of Canada is causing alarm, apart from the Arctic issue, for some Americans. Controlling the North American defence effort has been a role the U.S. has enjoyed. Now, with some independant objectives, the vitalized Canadian defence policy has become problematic for the Pentagon. The result so far has been limited to some harsh comment from U.S. critics.

The Arctic territorial dispute has two significant dimensions. The U.S. State Department talks about a concern for open sealanes traversing the north with an argument blossoming over geographical definition of the east-west passage. The Pentagon wants unlimited access to the Arctic to operate its under-ice naval fighting capability for tackling the growing threat from Soviet missile-toting submarines.

Lurking in Arctic Waters, Soviet submarines with powerful nuclear-tipped strategic missiles, have the capacity at any given time, to obliterate most key North American cities within a range of 5,500 kilometers from Baffin Bay. That would include U.S. cities from San Diego to Washington DC and Canadian metropolitan areas from Vancouver to Halifax. The Pentagon is reluctant to entrust negation of this threat to the wispy Canadian Navy, with or without nuclear-powered submarines. Recently muttered opposition to Canadian acquisition of nuclear-powered submarines has included objection to the prolification of U.S. born nuclear-power technology which is said to be the root of the British Trafalgar®MDNM¯ class presently under consideration by Canada. Whether this is a real concern or not, our American friends should take note of the clearly stated fact that Canadians will not allow their sovereignty to be diminished -- by any foreign power.
Micheal J. O'Brien

COMMENT: BY THE FIRESIDE... Micheal J. O'Brien (6) MOB  Micheal J. O'Brien

Go Back To Page Index At Top Of This PageBY THE FIRESIDE...

"When you launch this new publication," said one of my mentors, ``You'll need to designate an issue for a `fireside chat' with your readers. Tell them what you intend to accomplish with the publication, and why.''

In the cool darkness, high in the Adirondacks and sitting outside the cabin on Echo Lake between Plattsburg AFB and Griffiss AFB, it isn't difficult for me to conjure up the fireside atmosphere. But for you in your office... I am sure it's not so easy. 

A pair of National Guard A 10's (Warthogs) on a routine training exercise out of Syracuse came whistling across the lake this afternoon. Being surrounded by tactical, strategic and fighter/interceptor air bases is not an uncommon nor unacceptable phenomenom in the northern states. The natives here pay the noise of the A 10's the same attention they give the morning bird songs and the evening coyote howls. Later in the day, the distant sound of another B-52 climbing out of Griffiss somehow reminded me that I must break from R & R and make my weekly contribution to our new Canadian defence weekly. Another log on the fire.

Covering military affairs related to the field served by our trade journal AEROSPACE CANADA INTERNATIONAL has been for myself, and the magazine's staff, a revealing and sometimes frustrating experience. The contrast in visibilities between the Canadian and American defence efforts is startling. The attitude of most Canadians living in the nation's 21 major cities is established in an environment where millions have no contact with, or awareness of, Canada's armed forces. Without this visibility there is little perception of need. Public media coverage of national defence issues is minimal and often critical. The defence industry, with few allies, has suffered low esteem, minimal support and inhibited growth. While undeniably there are several fundamental issues at work, I see a lack of frequent and reliable communication as a common problem. If Canadians shall not provide that communication, then who shall?

I firmly believe that the most important role of a business or trade paper is to stimulate and vitalize the industry it serves. Communication that links together the government, military and industrial leaders by sharing knowledge of real problems, goals and opportunities, can only lead to a stronger military-industrial complex with all of the accompanying technological, economic, political and diplomatic benefits. 

THE WEDNESDAY REPORT was first contemplated in September, 1984 when the Canadian electorate sent a powerful, pro-defence Conservative government to Ottawa. Research began and a plan evolved. We first went to press with the publication one working day after the overdue defence policy White Paper.

It is no secret that TWR draws upon the resources of the bimonthly AEROSPACE CANADA. Team leader and Editor, Bill Knapp, masterfully directs the many writers, correspondents, contributors and editors, _ a team that has grown over the past decade _ to provide you with immediate coverage of important product, policy and programme developments, not just from Canada but from wherever there may be significance to your interests. Expert in computer technology, Bill has created a completely integrated PC-based system, using specialized software and the power of Maclean Hunter's own mainframe typesetting system to provide a 6 hour turnaround time from final edit to final printed copy. Continued developments are planned. TWR, delivered by courier, arrives at nearby destinations on Tuesday afternoons, and at more distant points on Wednesday. 

I'm proud of the dedication and enthusiasm of our team: Bill Knapp _ Editor; Martin Shadwick _ Contributing Editor; Al Ditter _ Contributing Editor; Lisa Crandall _ Circulation Manager; John Bellinger _ layout and design; Mike Simpson _ production; Stan Homuk _ distribution; Rose Longo _ promotion; and the many ACI writers who provide a continuous flow of solid material. 

These people sincerely wish to provide you, our subscribers, with the ultimate in service. Please be sure to let us know of any specific topics you wish to see covered. Thanks for your support and feedback.
Micheal J. O'Brien

TWRV1-ISSUE: 9. (AUG. 5)
COMMENT: A DARK SHADOW (6) MOB  Micheal J. O'Brien

Go Back To Page Index At Top Of This PageCOMMENT:

The New Democratic Party has offered its own defence policy paper. ``A recipe for chaos, a recipe for disaster,...'' says Doug Frith, Liberal MP and defence critic. The shadow policy statement to the government's published defence policy, advocates withdrawal from NATO and a rewritten NORAD agreement to exclude the U.S. from North Warning and to exclude Canada from anything that might resemble SDI or ADI. 

With public opinion polls®MDRV¯{0L}®MDNM¯ indicating more than 40% support for the NDP, it is clear that there is good reason for you to be concerned about this shadow paper. For the same reason it is regrettable that Blackburn and his defence policy advisers (if any) did not research nor provide significant rationale for the essay. TWR interviewed the NDP defence critic last week. Blackburn responded negatively when asked about data sources or threat scenario authors to support major details of his policy paper. It is also clear, however, that Blackburn is fervently commited to the outlined concepts. And apparently he has the support of the NDP leadership and in his words, ``the support of a vast majority of the caucus including our external affairs critic Pauline Jewitt''.

 ``A New Democratic Response to the Defence White Paper'' as Blackburn candidly admits, is a New Democratic policy paper. If the party were to form the next government of Canada, they would withdraw from NATO and bring home 4 CMBG and 1 CAG; cancel the nuclear submarine programme; buy 12 conventional subs; reinstate SRP III thus adding 6 new frigates to the current plan for 12; scrap the existing NORAD agreement; revoke permission to the U.S. for cruise missile testing in Canada; replace the Sea King helicopters; install sea-bed submarine detectors at Arctic choke points; and in all, task the Canadian Forces exclusively with defence of ``Canadian territory and sovereignty, contributing to world peace and disarmament, and remaining non-nuclear''. The NDP addresses the commitment-capability gap by reducing commitments overseas, and then in contrast by setting a stand-alone responsibility for Canadian territorial defence and North American air defence. Except for a small transportable infantry unit, the Army would presumably be fired. Reservists would stand ready to replace the small mobile infantry should they have to rush off to rescue `another democracy that appealed for our help'. 

The occasional sojourn into someone elses war, for the sake of peace, would be the only offshore role of the Canadian Forces. ``We wouldn't go flying off all over the world every time shots were keeping with our traditional peacekeeping role - moving into hot spots where we are required to put out a war,... a brush fire war''. Where? According to Derek Blackburn; ``The Persian Gulf, Middle East, Nicaragua... possibly, Panama, Southeast Asia, Afghanistan, Pakistan. I'm not saying that we should play a direct role but we should be flexible so that we may be able to contribute... through the U.N. To me that is far more sensible and less don't have to replace the Leopard 1s with Leopard 2s (What, no tanks?) I'm talking about transposing or changing the entire mobile command from armour and mechanized into rapid air transportable light infantry. There could be some prepositioning. (Where?) For example I don't necesarily say goodbye to Norway (if Norway will allow pre-positioning of equipment)''.

Said defence minister Perrin Beattyabout the NDP position paper, ``Its written very much like a high school essay. If you were grading it you would have to give it a failing mark''. When asked by TWR about potential damage caused by emanations of this sort from Canada; ``... I hope that when they have a chance to really think through the implications of what they are proposing here that they'll withdraw the paper and come back with something somewhat more responsible and better considered.''

The flaws in the NDP's defence policystand out vividly like those in a National Lampoon sketch. Abandoning our NATO commitment would be ill-received by other NATO countries. Possibly creating instability within the organization, such a move would add fuel to the debate from U.S. isolationists - currently an onlooking minority - who suggest that the U.S. withdraw from Europe. Should Canada withdraw, exports of Canadian defence product to NATO countries would cease and general trade would diminish. Participation in disarmament talks would be impossible. The nuclear threshold in a European war would be lessened by an ammount equal to the effect of losing Canada's 12,000 man commitment. The Soviets would have another line to add to their anti-NATO chant and a small boost to their confidence and ability to take western Europe. 

On our own,the defence of Canada's 9,976,185 square kilometers with our small armed force would be a tough job. It would certainly exceed the level of military activity that Canadians have thus far been willing to finance. Cost is a factor, among others, that has escaped the attention of the NDP. Other countries who defend real estate of similar size on their own have millions of suitably equipped military personnel. Past Canadian governments have augmented Canadian military strength by depending on treaties like NORAD and NATO to provide for war-time and peace-time assistance from allies. The NDP doesn't see the need.

Paying the full price of North American air defenceseems unreasonable considering that the U.S. is more likely to be the subject of Soviet hostility. And expecting the Americans to allow responsibility for their northern defence to fall exclusively to Canada, with an NDP government, is an absurdity. 

While the party's popularity remains high, the NDP's defence policies loom ominously like a dark shadow cast across the country.
Micheal J. O'Brien

TWRV1-ISSUE: 10. (AUG. 12)

Go Back To Page Index At Top Of This PageTERRITORIAL AIR DEFENCE

Is Canada recognizing the renewed threat of Soviet air attack against North America? The new defence White Paper has prompted considerable debate over this issue even to the point where the NDP, in it's recently published response to the White Paper, is calling for the return to Canada of all foreign based and dedicated CF-18's, and their exclusive devotion to Canadian territorial air defence. 

Growing concern for the Soviet air-breathing threat is warranted in light of current disarmament negotiations and the strategic defence initiative (SDI).  Consider the facts. Substantial pressure is being applied to both the Soviets and the Americans to achieve drastic if not complete elimination of strategic ballistic missiles. Seemingly, earnest disarmament talks between the two superpowers are currently underway. In the event of a successful conclusion, the Soviets would be reliant on long range bombers as their deterrent to strategic air attack from North America.

Already there is clear evidence of a major effort by the Soviets to strengthen and modernize their bomber fleet with the air launched land attack cruise missile (ALCM) toting Bear H (first in service in 1984), and the highly advanced Blackjack (believed to be entering full production next year). The USSR Backfire inventory and it's variants are growing at a rate between 30 and 40 per year, and in a parallel development, the Soviet fleet of air-refueling tankers is increasing markedly. 

The objective of SDI is to negate Soviet ballistic missiles. Regardless of potential ICBM reductions the U.S.S.R. appears to be taking seriously, the ramifications of SDI which if effectively deployed in total or in any part, would reduce the Soviet retaliatory capability sufficiently in their view, to eliminate or reduce their achieved level of nuclear deterrence to a Western attack. Their reaction of course, has been to undertake similar research for their own version of SDI and anti-space/satelite systems, but also, it could be said that there is a renewed Soviet emphasis on strategic bombers with more sophisticated and lethal cruise missiles. Although the threat to North America presently exists in the form of land based ICBMs and submarine launched missiles (SLBMs), change is in the wind. 

"There is, unfortunately, not much Canada herself can do by way of effective direct defence that is of relevance against massive nuclear attack" is how the 1971 Liberal government's defence White Paper summed up it's attitude toward northern air defence. But nonetheless, it did bolster declining aircraft resources dedicated to Canadian territorial air defence, from 56 to 66 CF 101 interceptors. Through the later part of the sixties and well into the late nineteen-seventies, the Soviet bomber threat played a purely secondary role to intercontinental ballistic missiles (ICBM'S). In contrast to the ten year period prior to this, when some 200 interceptors, 90 Bomarc and Nike surface-to-air-missiles (SAM) were the mainstay of Canada's NORAD commitment, the seventies saw a substantial build-up of Soviet missiles and a decline in long range bomber reliance with a corresponding decline in the number of Canadian interceptors to a total of 36 CF 101's by 1975. Today the Canadian Air Force has 36 CF-18s dedicated to domestic air defence.

The 1987 conservative government's defence White Paper does not alter  the downward trend in our intercept capability. A squadron of CF-18s from Bagotville, and another from Cold Lake augmented by elements of the Operational Training Unit will have "Forward Operating Locations" at; Yellowknife, Inuvik, Rankin Inlet, Kuujjuaq, and Iqualit. Work on these bases has begun. "United States interceptors, and Airborne Warning and Control System (AWACS) would also be able to deploy forward to Canadian airfields to join our air defence forces"  is a White Paper statement that rankles some Canadians. The document in two pages or more provides scanty detail of what seems to be an ambitious space surveillance programme. Another portion of the sophisticated and complex network of trip-wires that upon sounding of the alarm cause a frenzy of activity as we hustle to get U.S. resources into place on Canadian soil. Apparently space-based surveillance is more important than providing increased numbers of combatants to contest the likely hundreds of Soviet bombers that could enter Canadian air space over all three coastal boundaries in a conventional or nuclear attack against North American targets.

Between the status quo, leave-it-to-the-yanks approach of the Conservatives and the do-it-all-ourselves approach of the NDP, there has to be some middle-ground. Our present day government would do well to re-evaluate their thinking and dig deeper into the coffers. Forthcoming public debate and criticism from opposition politicians could be harsh with the emotional appeal of the NDP's defend-our-home proposal perhaps winning favour. Not likely to ever again see 200 interceptors flying in defence of Canada as was the case in 1960, Canadians might feel comfortable with the mid 70's mark of 66 aircraft which could conceivably fullfill territorial defence requirements. Such an expenditure would also close the gaping policy-hole that the NDP are trying to walk through with their radical, off-the-wall, proposals.
Micheal J. O'Brien

TWRV1-ISSUE: 11. (AUG. 19)
COMMENT: SSN - TO BE OR NOT TO BE? (6) MOB  Micheal J. O'Brien Go Back To Page Index At Top Of This Page

SSN - To Be Or Not To Be?
Unless the French bidder pulls a rabbit out of it's collective hats, Canada will likely select the quieter and faster Trafalgar class nuclear-powered submarine. But will that decision pass muster with the U.S.? Will the Americans, under the guise of being concerned about technology transfer, slide their own proposal under the Minister's door? Or will a future federal government capitulate to the onslought of political and economic pressures and abandon the concept of building a nuclear-powered submarine fleet to retain the ``non-nuclear'' status of Canada's navy - whatever that means?

The New Democratic Party of Canada says that it will not tolerate a violation  of their nuclear non-proliferation principals. They would sink the nuke idea and buy 12 conventional subs - if they successfuly wrest power from the Conservatives in the next federal election. And for as long as they fib about the kinship of nuclear power to nuclear weaponry they'll continue to loose that argument as well, ... one hopes. The Yanks say, ``Who us?..Interfere?''.  And the present government says ``We need nuclear-powered subs!''. Oddly, there is virtualy no audible voice saying, ``We don't need subs at all''. 

Within academic circles, the debate is as cool as an American conning tower in the deep freeze of the Arctic Circle. There has been little in the way of public or published support from anyone that matters except for a very strong argument in favour by the Canadian Institute of Strategic Studies. But there has been plenty of subjective and noisy opposition from merchants of SSKs, suppliers of frigates and accoutrements, paroquial proponents of fund re-alocation to buy Army or Air Force hardware, and the folks `from Missouri' who just don't believe that we Canadians have it in us to build and maintain the new SSN sub fleet ... at less than twice the regular price. Many have argued that the nuclear submarine is not sufficiently visible to be effective in peacetime as a deterrent to those who would violate our soverign waters with their unwanted presence. Who is kidding who? Visible presence is detected by the sonar operator. Such cat and mouse games are not directed by the men in the crowsnests. Human optics have long since been replaced by sonar, radar, and electro-optics. If you are eyeball to eyeball with your challenger, then the battle has begun. 

Today there are 20 geriatric surface combatants, 3 replenishment ships, and 3 conventional submarines that provide the dubious might of the Canadian Maritime Command. In twenty years there will be twelve frigates and if industry and government have their act intact, more than a half dozen submarines - 10 or 12 by 2011.  If we are to have only a small naval force twenty years from now, then what shall it be? Obviously one would hope that it will consist of the most powerful and capable vessels available. 

Compared to conventional subs, the SSN can dive deeper, travel faster, submerge for longer periods of time, it is quieter (most types), and more manoeuvrable. Anti-submarine, anti-surface shipping and surveillance will be the primary roles of the Canadian SSNs. The seek and attack capability of the SSN would be an additional asset in wartime. The vulnerability of our surface ships can be diminished by utilizing appropriate submarine escort tactics, and the SSN itself is far less vulnerable to attack than an equivalent-dollar surface combatant. 

Apart from concern caused by the typical lack of distinction between a nuclear powered (SSN) submarine and a nuclear missile (SSBN) carrying sub, and notwithstanding the current lack of confidence in the Canadian shipbuilding industry, it is hard to understand the opposition to our Navy's bid for some real might. If the government adequately educates the public, and if industry can do it's job without overburdoning the national coffers, our country will launch its first SSN within ten years. And considering the current state of the Navy,...sooner would be better.
Micheal J. O'Brien

TWRV1-ISSUE: 12. (AUG. 26)

Go Back To Page Index At Top Of This Page
Could it have occurred at a worse time for the already gun shy Oerlikon? Not likely.

The mounties have accused a Member of Parliament and a citizen of Saint-Jean-Sur-Richelieu of wrongdoing, including bribery, fraud, and conspiracy to commit fraud. The alleged offenders are Andr‚ Bissonnette, a former Cabinet Minister (resigned at the request of the Prime Minister on January 18, 1987) and Normand Oullette, a Saint-Jean businessman. Mr. Bissonnette has publicly declared himself to be ``not guilty.'' The charges were laid last week in connection with the much publicized Bissonnette/Oerlikon Affair in which it is alleged that persons did profit from privileged information in the `flipping' of land from a price of $.8 million to $2.97 million. Maximum penalties for individuals who are convicted of such crimes range from two to fourteen years imprisonment.

If there was any hope that the Bissonnette proceedings would begin and conclude in the time frame that follows the U.S. evaluation of the Canadian/American bid in the FAAD-LOS competition (see TWR July 8 and 15), in light of last week's news, that hope has been terminated. The U.S. Army is now officially late in the schedule of tests and evaluations for their FAADS programme _ about three weeks late. It is doubtful that they will reach a decision this year. The competitors to Martin Marietta and Oerlikon (ADATS) are about to have a field day at the expense of the ADATS bid. And if Phil Gregory and the Liberty missile gang at LTV/Thomson have their way, the programme could run long enough for them to savour every damaging morsel of bad press that Oerlikon is likely to receive. The Liberty team will use the time to create a system of their own that is worthy of the competition, and use the misfortunes of Oerlikon to their own benefit.

Respectful of the right of individuals for a fair hearing in pending proceedings within the Quebec judiciary, the media will have only Oerlikon and the Canadian LLAD programme to focus on. If the first chapter of the `Affair' is any indicator, the national notoriety of Oerlikon is about to get a further jolting injection of `journalese,' and the air will again be filled with the `Oerlikon Scandal.' Brace yourself, Chapter Two is about to hit the presses.

Partly fertilized by juicy gossip dropped into the fray by competitors, and  driven by a scandal-lusting press and public, the eruption of the first chapter of the `Affair' was torrid indeed. With a passion, Canadian media and headline writers, with very little to go on, clobbered everything and everyone associated with the story. Headline hackers and notebook novices lambasted DND, Oerlikon, the Prime Minister, the LLADS programme, the budget, the expense, the system, and even the finer details of infrared tracking (?). Headlines like ``$1B Defence Goof,'' ``Military Admits Missile Failure,'' ``Costly air defence system fails in bad weather...'' and ``Oerlikon Chief Pleads Naivette In Deal,'' were all the result of a suspicious land deal made by southern Quebec locals. Some coverage was excellent, but plenty stank. Bound by The Official Secrets Act, neither DND nor Oerlikon were able to respond specifically to criticism of the LLAD system. The Royal Canadian Mounted Police _ much to the credit of a Montreal newspaper who first broke the story _ has responded firmly and decisively to the land flip articles.

Unscrupulous practices in the assigning and administration of defence contracts is not exactly an unheard of phenomenon. But learning that the shoe has slipped to the other foot does indeed breed controversy. In this case it is not the company but a government official and others who were peripheral to the defence contracting process, that have been named. But why does the company get such bad press?

It is hard to think of a major defence contractor that has not been accused of some form of corrupt practice. Says a representative of one such company, ``It is expected of you in many countries. You have to include such `lobby' money in your marketing budget.'' As is the case with the Bofors scandal in both Iran and India, the defence contractor is usually the name that gets the headlines _ and gets nailed by the law! Mr. Ghandi, Prime Minister of India, is squirming under the attack of accusers who say that his officials accepted some $50 million in bribes for the award of a $1.5-billion artillery contract to the Swedish-based Bofors. Swedish authorities will act to ease the pain of Mr. Ghandi by scrutinizing the records of Bofors. Did the government official ask for the bribe or was it offered? One has to wonder how often the contractor becomes the `fall guy' as unscrupulous government officials close ranks to embrace and protect their own kind.

From the experiences of some industry salespersons, it would seem that moral standards are indeed not standard at all. ``Every country is different! From vacation packages and gifts to outright cash bribes, we are expected to thank our customers in a number of countries where we do business. It's simply their way of doing things. And we see it in one form or another here too... but nowhere near as bad...'' said one Canadian defence marketer who vehemently insisted on not being identified. From elaborate entertainment to expensive `gifts,' the beat goes on. Dancing to the music the defence product salesman _ who believes in his product, and is convinced that he has the competitive edge _ must co-operate with the customer regardless of moral convictions. ``If I don't play ball with this guy, [referring to a customer who wanted a `kickback'] my company will probably find someone who will, and I'll be out of a job. It's not good enough just to be the best... you have to pay your dues as well,'' was the rationale of one such person.

Under the topic of corruption it is hard not to comment on the recent propensity of Canadian government members to `make deals.' With the election of the Conservative's super majority in 1984 came a new tribe of governing politicians. A large number of them are businessmen who, in the usual way of the entrepreneurial businessman, love to do business and make deals. We will soon hear the result of an enquiry into the affairs of one Sinclair Stevens who may appear in the history books as the all-time dealmaker, making Monty Hall look like a game show host instead of a metaphor. Others in this Parliament have made their deals, had their day, and got the boot _  the Prime Ministerial boot. Are there any more wheeler dealers amongst them?  Heaven help us all if they maintain the pace of unsavoury deals that has been the hallmark of the Mulroney gang.

It is regrettable that the defence industry has been afflicted by this perverted inclination of individual sitting members of the government's side of the House of Parliament. Nonetheless, industry must avoid picking up bad habits and resist the temptation to initiate their own hanky panky.

Canadians must learn to eliminate these problems. Although our defence procurement process is more wholesome than many others, it will need close scrutiny as the volume and number of defence acquisition programmes increases as a result of Canada's desire to upgrade her armed services and their equipment. To even contemplate corrupt or pseudo-corrupt practice, is to play with the most scorching of fires. As in the case of the current `Affair' it is not just the alleged violators who get burned, but perhaps also the alleged innocent as well. In time it may be hard to tell them apart amidst the charred remains.®
Micheal J. O'Brien

COMMENT: THE FAMILY EXPANDS (6) MOB  Micheal J. O'Brien Go Back To Page Index At Top Of This Page

The Family Expands
The end of this summer marks the 10th anniversary of sister publication, Aerospace Canada International. With this milestone come two other notable birthdays; the 25th aniversary of Canada in space and the 100th birthday of parent company Maclean Hunter Limited. These events provide substantive excuses for celebration but also _ in light of the critical times facing our nation _ considerable reason for pause and reflection.

By early October it is expected that some form of free trade agreement with the United States will have been drafted and ready for final approval by the governments of the two nations. Assuming that there is a ``no holds barred'' approach to publishing in Canada (the `cultural issues' so often discussed in the public's view) with open and uninhibited competition from U.S. publishers, it could then be said that only the strongest and the best will survive. The Wednesday Report (TWR) was launched on June 10th after much study and evaluation of the marketplace, and with due consideration for the free trade talks and all their ramifications. The plans for TWR in a multi-phased launch programme are well suited to any forseeable situation that may present itself. In phase II and III of the launch, new services will be offered to subscribers including a sophisticated online data service. Already some 30 per cent ahead of schedule, TWR has enjoyed a successful introduction that has exceeded our best estimates. (Our grateful thanks to you the reader.) Subscriber reaction has been fascinating and most valuable. Several new features and columns will be introduced in the fall as a result of your suggestions. 

While The Wednesday Report continues to form and mature, sister publication Aerospace Canada International (ACI) will change considerably. Recognizing the  unique challenges that the next ten years will bring as a result of the defence White Paper, free trade, and a growing defence industrial base, ACI 
will be published under that name for the last time on Sept. 24th. In addition to regular mailing to subscribers, special copies of the publication will be provided to attendees of the Aerospace Industries Association's (AIAC) annual general meeting in Quebec City while extra copies will be printed for collectors, libraries and others. The last issue will contain a calendar section commemorating the 25 years of Canadian achievment in space. 

Expanding from nearly exclusive devotion to coverage of Canadian aerospace technology, the name on the publication's masthead will be replaced with Aerospace & Defence Technology starting with the November edition. An international publication circulated from Canada, A&D Tech will have an editorial mandate that has been broadened to cover those areas of policy and technology that have applications within the land and sea elements of the western world's armed forces, thus augmenting the magazine's traditional coverage of aerospace topics. Written from a Canadian perspective, the new publication will follow in the footsteps of ACI in fulfilling the communication requirements of the Canadian industry at home, while at the same time sharing news of Canadian developments with thousands of readers around the globe.  A&D Tech writers will immediately address a larger number of readers with a 100 per cent increase in domestic controlled circulation preceeding an equally substantial boost in offshore distribution. And the readers and writers of the magazine get a new editor.

Leading the editorial team is the latest addition to the publication's executive management staff, retired Canadian Forces' major, Allan Ditter. Most recently serving as the officer in charge of the Department of National Defence's (DND) public information bureau for southern Ontario, Al was, for over three years, Editor-In-Chief of the Canadian Forces' publication, Sentinel. With more than 25 years in the Canadian Armed Forces as a distinguished writer and officer, Al brings to the editorial team, a new vibrancy in leadership and a wealth of experience that is complimentary to the objective of providing the reader with an informative, and stimulating, high technology journal.

Today's political and industrial developments point to the challenge _ a new commitment to the defence of Canada and the promise for enhanced effort in support of our allies; strong participation in space station; space-based radar; recent developments in ASRAAM, and ADATS; several new Canadian aircraft; free_trade negotiations with the U.S.; a rapidly expanding high-technology industry base; - all contribute toward an ever increasing requirement for a communicating journal that links Canadians to the free world's aerospace and defence communities and them to us. That journal, we all feel, must be Canadian - hence the birth of Aerospace & Defence Technology.
Although we say goodbye to Aerospace Canada with some nostalgic remorse, the excitement that fills the air at the publication's Bay St., Toronto offices has generated a high-energy electric atmosphere that will inspire all to excel in the remaining 80's and to enthusiastically meet the challenge of the 1990's. It is our hope and our goal that you too will share that excitement in the coming issues of AEROSPACE & DEFENCE TECHNOLOGY. 
Micheal J. O'Brien

COMMENT: FUNDING THE WHITE PAPER (6) MOB  Micheal J. O'Brien Go Back To Page Index At Top Of This Page

Funding The White Paper
Were we being fooled or will they back it? In October, Cabinet will evaluate funding proposals for the execution of policies and programmes outlined in the defence white paper. In accordance with the process prescribed in the white paper, ``An annual Cabinet review each autumn will establish firm budgets for the following five-year period, and planning guidance for the remaining ten years.'' Guidelines for funding growth rates were somewhat noncommittal. ``The government is committed to a base rate of annual real growth in the defence budget of two per cent per year after inflation, for the 15-year planning period. Increased resources over those provided by (the) planned funding floor will be necessary as major projects forecast in the White Paper are introduced.'' Does anyone really appreciate how substantial those ``increased resources'' will be? The white paper is not lavish by any stretch of the imagination, but the challenge of repairing the damage done by decades of disregard requires substantial resources.

Inflation too, is a nebulous factor in the determination of the budget. Within the defence community, the rate of inflation is typically higher than that rate reported by consumer agencies and other industry sectors. What rate will the government use, and who can argue with an arbitrary determination?

For example; based on a modest 4 per cent - and perhaps unrealistically low - inflation rate, add the guaranteed 2 per cent growth rate, and the defence funding floor would be $10.93 billion in FY 88/89, $11.59, $12.3, $13.04 and $13.84 billions in the subsequent four years. The numbers resemble past trends, but with the cost of Canadian defence procurement rising at an abnormal rate due to costly regional and political demands placed on contractors, 4 per cent  inflation seems low. The annual rate of increase in defence budgets for Canada has averaged more than 10.6 per cent (including capital project costs) over the past 10 years. And at that rate, the resources have been inadequate. 


 Year    Budget   % inc. % GNP   GNP inc.
77/78  $3.79B  ----%  1.733%  ----%   
78/79  $4.13    8.97   1.691   11.4
79/80  $4.38    6.05   1.578   13.6
80/81  $5.05   15.30   1.614   12.8
81/82  $5.91   17.03   1.692   11.6
82/83  $7.04   19.12   1.902    6.0
83/84  $7.84   11.36   1.947    8.8
84/85  $8.77   11.86   2.003    8.7
85/86  $9.38    6.96   2.001    7.1
86/87  $9.96    6.18   2.045    3.8
87/88  $10.30    3.41   -----    ---

Defence spending in Canada over the past ten years, had risen early in the period as a result of the former Liberal government's realization of the damage it had done by ignoring the Canadian Armed Forces. Concurrent to this awareness, a modestly improved philosophy emerged that advocated 3 per cent real growth in defence spending. The Conservative opposition at the time clamored that 3 per cent wasn't enough. And it wasn't. But, ironically, the self proclaimed, gung-ho pro-military Conservative government has - since elected to govern the country - decreased defence spending. 

Perhaps finally the Mulroney government will fulfill it's promise. On the whole, the defence white paper is a good document. The proof of the commitment portion of this `Challenge and Commitment' paper is not to be found within the pages of the book but, one hopes, will be manifested in the decisions of Cabinet this fall. 

Dates for the introduction of capital costs will naturally depend on the schedule of major programmes. The Ship Replacement Programme, an unknown in terms of timing, will have to be addressed immediately. Acquisition of 30 small naval vessels, replacement of the main battle tank, the SSN submarine programme, the Tactical Command, Control and Communications (TCCCS) requirement, the military space project, 6 or more long range patrol aircraft, upgrading the CP 121 Tracker, the new Eryx missile programme, various vehicle programmes such as the Heavy Lift Wheeled Vehicle (HLVW), numerous weapons and equipment requirements of an additional 48,000 reservists, and the forward staging of equipment in Germany, some 10 additional CF-18's and a large handful of other projects will need to be timed and funded over the 15 year period the Cabinet is about to discuss. 

As asked rhetorically by industry spokesman, AIAC president Ken Lewis in a recent editorial published in Aerospace Canada International, ``Will this `firm' funding envelope be large enough to make a substantial start on implementation (of the white paper)? Or will we see signs of the old pattern, with equipment needs pushed ever further into the future?''

The decay in manpower and equipment resources of the Canadian Armed Forces has been drastic to the point where some observers have said that the situation is, in economic terms, without solution. The Perrin Beatty white paper offers a modest and acceptable solution. The Canadian population, while not usually serious-minded about defence issues, elected a government in 1984 that promised drastic action to improve the capability and define the tasking of the CAF. While not drastic, the white paper does accomplish both. Will the Cabinet fund the white paper? It is a difficult and critical task and yet an opportunity to shine brightly, not just in the history books but in today's political arena. Count the supporters (voters?). There are 86,000 regular force members, 51,100 reserves, 41,100 civilians and 12,000 students that make up the Canadian Forces. Some 30,000 civil servants playing a supporting role, several hundred thousands of job related industry workers, countless thousands who live in the dozens of communities that depend economically on CF bases, there are the families of all these people and the veterans of past wars, the retired service personnel, and the millions of Canadians who are deeply concerned about Canadian sovereignty having been alerted by recent events in the north. The Canadian defence dilemma is no longer a non-issue for the politician. The Mulroney Cabinet has many good reasons to support its white paper with action. They could even become heroes. 

Contrastingly, if the current government has led us all down the garden path, with no intention of backing the plans they have mapped out, then they will have done the country a terrible disservice and shall deserve a thorough trouncing in the next election. And if that means that the defence establishment, Canadian sovereignty, and the defence of Canada are left to the NDP party - as pollsters suggest might happen - then the writers of history must show no mercy for the Mulroney gang. 

Go Back To Page Index At Top Of This PageMicheal J. O'Brien

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