Volume 38, Number 2: March/April 2004

Canada And The Big Business Of War

Millions of working Canadians are being fiscally conscripted into the shameful business of war. We are forced into this unwitting participation in the arms trade and imperialist American wars, thanks to the Liberal government’s legislation governing the Canada Pension Plan. Through our mandatory CPP contributions, we are entrapped in complicity with many of the world’s most notorious warmongers.

CPP: Forcing Canadian Workers to Invest in the Arms Industry

The CPP Investment Board manages all of these investments. It was created, and is governed, by the CPPIB Act of 1997. It dictates that the CPPIB must base its investment decisions solely on profit. In the CPPIB’s policy statement on “social investing,” it states clearly that it will not consider any ethical issues when deciding how to invest our pension funds.

New Democratic Party MP Pat Martin (Winnipeg Centre), inspired by a recent report from the Coalition to Oppose the Arms Trade on CPP military investments, has placed a motion before Parliament to force the CPPIB to use ethical investment guidelines. However, Liberal MPs, especially under the rule of Paul Martin’s extremely, corporate-friendly leadership, will not support any such motion. They will no doubt favour the status quo, so that CPP investments will continue to include many of the world’s most unethical corporations.

The CPP portfolio includes the world’s three largest tobacco manufacturers, and so Physicians for a Smoke-free Canada has launched a campaign against these investments. Other activists fighting for labour, the environment, health and social justice would also do well to look into CPP investments and to expose the corporations that they most ardently oppose. There is no shortage of activist campaign fodder within the list of CPP investments. Included there are corporations that own sweat shops and profit from child labour, industries and mines despoiling the world with toxins and companies making billions by rebuilding “post-war” Iraq.

And then there are the weapons makers. Last year, the CPP invested in 15 of the world’s top 20 weapons manufacturers:

  1. Lockheed Martin, USA
  2. Boeing, USA
  3. Raytheon, USA
  4. BAE Systems, UK
  5. Northrop Grumman, USA
  6. General Dynamics, USA
  7. Thales, France
  8. EADS, Netherlands
  9. Honeywell, USA
  10. United Techologies, USA
  11. Mitsubishi Heavy Ind, Japan
  12. General Electric, USA
  13. Rolls Royce, UK
  14. GKN, UK
  15. Computer Sciences, USA

As of September 30, 2003, the CPP had just over $2.6 billion invested in military contractors. Of that, almost $1 billion was invested in 65 U.S. military corporations. Over $600 million of those investments went to 29 of the Pentagon’s top, prime contractors. Between 1996 and 2002, those corporations landed contracts with the U.S. Department of Defense worth about USD $340 billion. Some of these contracts were for producing major conventional weapons systems, others were for providing the incredible amounts of specialized fuel products required to get those weapons into combat.

Most of the remaining investments (about $1.6 billion) were funneled into about 50 Canadian military contractors. Many of these corporations also have U.S. military connections. Many “Canadian” military corporations – especially the larger ones – are actually branch plants of U.S. companies. Most military hardware made in Canada is built specifically for export, and most is destined for the U.S. Once there, Canada’s largely high-tech components are assembled into weapons systems used to wage U.S. wars.

War Business is Booming

The Canadian Department of Foreign Affairs and International Trade publicly claims that it “closely controls” the sale of Canada’s military technology to all countries “involved in or under imminent threat of hostilities.” Sounds good, right? However, the export of Canadian military hardware to the U.S. is completely unrestricted. No export permits are required. Any caution that our government supposedly has regarding sales to nations at war, is completely ignored in order to maximize military exports to the U.S. The fact that the U.S. is almost perpetually involved in at least one covert or overt war, invasion, military attack or intervention, does not concern Canadian bureaucrats “controlling” our military exports. America’s permanent war footing is, in fact, the main reason for booms in our arms export business.

Not only does the Canadian government permit this totally unfettered weapons trade to the U.S., it bends over backwards to encourage and facilitate it. And, thanks to our U.S. free trade agreements, the Canadian government is allowed to subsidize military products exported to the U.S. So, Canadian taxes are used to grease the U.S. war machine.

Since 1970, two Industry Canada programs alone – the Defence Industry Productivity Program (DIPP) and its successor, Technology Partnerships Canada – have taken more than $4 billion from Canadian citizens and doled it out to about 600 of this country’s military contractors. About $3 billion of those handouts went to about 80 of Canada’s most profitable, military-related “corporate welfare bums.” About $2.5 billion of that went to ten of our largest and most profitable military contractors. The top recipient, Pratt & Whitney Canada, has received more than $1.2 billion through these two programs alone. Although much of this was ostensibly given as loans, even decades later, 80 per cent of these “loans” has been never repaid.

Canada’s Part in Major U.S. Weapons Systems

The CPP invests in prime military contractors that build an appalling array of major weapons delivery systems. These weapons manufacturers produce dozens of the most horrific war machines ever created. Among their deadly wares are a bewildering assortment of fighter, attack and bomber warplanes, armoured personnel carriers, main battle tanks, warships and rocket/missile launchers. Many of these “delivery systems,” subsidized by CPP investments, were used to wage the latest U.S.-led “regime change” in Iraq.

At least 100 Canadian corporations contributed components and/or services for at least 35 of these major weapons delivery systems used recently in Iraq. In 2002 alone, Canadian military subcontractors sold about US$440 million worth of military equipment to the U.S., the vast majority of which was employed in that war.

The same U.S. prime contractors producing the major weapons delivery systems, in which we have been forced to invest, also produced dozens of varieties of so-called “dumb” bombs and “smart” missiles. The CPP invests in corporations making a many diabolical devices such as anti-personnel cluster munitions, incendiary/fire bombs, field artillery weapons, high explosive munitions and even several types of cruise missiles.

In 2002, the CPP even invested in several top U.S. war industries that have manufactured antipersonnel landmines (APMs): General Electric, Raytheon, Texas Instruments and Rockwell. APMs made by these companies are now among the 15 million or so of these illegal weapons now stockpiled for future use by U.S. forces. What’s worse, CPP invests in Lockheed-Martin, which still produces components specifically designed to guide the free-fall descent of cluster bombs so that they can more accurately scatter fields of anti-personnel landmines.

Canada at War in Iraq

The fact that Canadians are being forced to finance the American military-industrial complex may be shocking to Canadians. Our society suffers from the widespread delusion that this country is a strong force for global peace. Many Canadians even see our government as a global peacemonger. Canadians generally opposed the latest Iraq war, and despite much evidence to the contrary, Canadians still naively believe that the Liberal government completely boycotted the war. They didn’t.

The shameful truth is that in several important ways, Canada actually ranked third – just behind Britain and Australia – in supporting that war. Canada commanded the naval task force in the Persian Gulf protecting U.S. warships that launched deadly air sorties against Iraq. Canada provided war planners before and during the war. Canada provided air traffic controllers aboard AWAC aircraft controlling the “safety” of warplanes doing aerial bombardments. Canada allowed hundreds of U.S. military overflights and allowed refueling stops.

Many other governments, though providing only a tiny fraction of such assistance, were at least honest enough to admit their involvement. The Liberals were silent about their role in aiding and abetting this illegal war. They were unwilling to be counted as a member of the “Coalition of the Willing,” preferring – hypocritically – to pretend that they were taking a principled anti-war stand. The Liberal government’s PR experts skillfully maintained the party’s popular, but illusory, public image of a global peacemaker while engaging in many blatant acts of complicity in the war.

The Myth of Canada the Peacekeeper

Forcing Canadians to invest in businesses that profit from war is not an aberration in Canadian policy, it is completely consistent with our tradition of being a silent partner in U.S. wars. The delusory myth of Canada the global peacekeeper looms large over our collective self-image and helps define how we see ourselves. In order to make this worthy dream an actual reality, Canadians will have to face the ugly fact that we are very deeply complicit in the U.S. war machine.

How can the government get away with taking billions of dollars from unwitting citizens and pouring it into the coffers of corporations responsible for the world’s deadliest weapons?

Most Canadians would probably not want their hard-earned pension money, or their taxes, given to the Liberal Party’s corporate friends that are blatantly profiting from war. Most, however, do not even realize that they have been financially conscripted. The functioning of this whole criminal enterprise relies heavily on maintaining public trust. The scam has only worked because people have an unflinching faith in their nation-defining myth. Considering all the evidence to the contrary, it may seem amazing that so many Canadians, and many millions elsewhere, still believe the lie that Canada, and particularly the governing Liberal Party, is a global force for peace and human rights.

The current Iraq war is only the latest U.S.-led military operation in which the Canadian government and business (and by default, the Canadian public) have been deeply complicit. For decades, Canadians have invested in, and profited from, corporations whose products have been integrated into weapons systems that have killed millions of innocents, all in the name of peace, freedom and democracy.

The Plot Thickens

While the Canadian government funnels billions of dollars from its citizens into the bank accounts of military contractors, many of these businesses return the favour by stuffing the war chest of Canada’s ruling political party. Although there are various loopholes that legally allow corporations to give secret donations to political parties, we do know that between 1993 and 2002, Canadian military contractors gave at least $7.93 million to Canada’s three main corporate political parties. Of these disclosed donations, the Liberal Party received $4.93 million (62%), while $1.81 million (23%) went to the Progressive Conservatives, and $1.19 (15%) was given to the Alliance and Reform parties. (The Bloc Quebecois and the NDP received little or no such donations from military corporations.)

While the amounts of these disclosed political donations may seem relatively small, at least when compared to the billions invested by our government in their friend’s military corporations, we must keep in mind that secret political donations probably make the actual totals much higher. Also, the business of running a political party is not nearly as capital-intensive as the business of manufacturing the expensive machinery of war.

One thing is for sure, Canadian military contractors know who their friends are in the political arena. The question remaining is: Do Canadian citizens know who their political friends are? To make informed choices in the upcoming federal election, Canada’s public needs to uncover the very cozy relationships that exist between the Liberal government and its close friends and business partners in the military industrial complex.

Richard Sanders is editor of Press for Conversion! and coordinator of the Coalition to Oppose the Arms Trade.