Fun With Numbers

Andrew Coyne:

You will be familiar with how the government’s official estimate of the cost of the planes has, ahem, evolved over the years: from $9-billion originally (just the acquisition cost), to $16-billion (including acquisition and “sustainment,” but not operating costs), to the $25-billion (including all costs, but only over 20 years) it grudgingly owned up to after the Auditor General’s report last spring.

As you’ll recall, the Auditor General said even that figure severely underestimated the true cost of the project, as the actual service life of the planes was not 20 years, but 36 years. Others, including the Parliamentary Budget Officer, put it at 30 years: that’s the number KPMG used. And the figure that popped out of its calculators was $45.8-billion.

It is understood that the Conservatives royally botched the PR on this one.

It is readily conceded that whatever the merits of the F-35 fighter our current fleet of F-18s need to be replaced.

Yet the most striking thing about this fiasco is the colossal hypocrisy and innumeracy of the MSM. Coyne's point above is that the Tories low-balled the numbers to avoid political repercussions. Even by the decrepit standards of modern politics we should have expected a greater degree of transparency. But put yourself in the shoes of Peter MacKay and see it from his perspective.

Pete is terribly fond of these of planes. They're part of a multinational procurement process, which is one of the reasons the numbers are a bit slippery to get a grip on, and he's stuck his neck out at various international meetings claiming that Canada will be buying its share.

This being a parliamentary system the opposition will oppose the government even if the responsible ministers have done nothing more than sneeze in an unusual manner. Peter MacKay, who has been in politics for most of his adult life and whose father Elmer served under the Brian, knows only too well that if he reveals the full full cost of the plane, it's going to be some gigantic sounding number.

At this point the rabidness of the opposition meets the unusual mindset of the Canadian voter. In Canada governments boast about how much they spend on health care. If Peter MacKay had been announcing a series of new health care programs he would likely have exaggerated the costs. Why? Because the electorate does not see spending on health care as spending. Instead the tanker loads worth of money burned through by Medicare every year is viewed as a sign of government munificence towards the people. Even if it is the people's money being burned.

Spending billions of dollars for more health care bureaucrats is a sign of compassion. Spending billions to allow the government to conduct one of its core responsibilities is, by contrast, a shocking example of fiscal recklessness. This is the logic of Canadian politics and why our soldiers are under equipped and our hospitals overstaffed. Should you questions this logic you will be deemed a cold and heartless monster. Often by the same people who care not a whit for those who serve in uniform.

At some point, this issue being about money and all, we should do a quick run through the numbers. I'm not going into the military debate about whether these are the right planes for Canada. Just the numbers for this particular plane. The KPMG numbers recently released put the F-35 costs at a very comprehensive $45.8 billion over 42 years. That's a little over a billion a year. To put that figure in perspective the 2012-2013 federal budget pegs spending at about $276 billion. So the annualized cost of buying and running these planes, including the salaries of the pilots, comes in about .36% of the federal budget.

Remember we spend $1.1 billion each year on the CBC.

Then there is the not inconsiderable matter of the $45.8 billion figure. It's a guess. A very educated and detailed guess but still a guess. No one really has a damn clue what these planes will cost in forty years time or even if we'll have manned fighters in 2052. Or a NATO. Or even an Air Force in the traditional sense. This is a guess which, at the outside, will cost something close to a rounding error of the federal government's annual outlays which, between now and 2052, are likely to rise much faster than the actual cost of maintaining the F-35.

All the while Medicare is slowing eating up the Canadian budget.

The scandal here isn't the Tories fudging numbers on some fighter planes, governments have been fudging procedure numbers for decades, it's the strange tunnel vision of the media and the electorate toward government spending. Miserly when it comes to defence yet spendthrift when it comes to social spending.

Who cares about the military, eh? As long as I get my free stuff.

Comments

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Thank you. Summed up very well. Very few Canadians care about the military, so it gets shorted on funds all the time... the numbers are big and scary though, so easy to trot them out and then cut them.

Posted by: Dwayne | Wednesday, December 19, 2012 at 11:35 AM