U.S. ambassador says he's confident Canada will strengthen its defences in the Arctic

The United States' top diplomat in Ottawa says he's been assured Canada will follow through this year on crucial investments to modernize its Arctic defence, even though this month's budget didn't include money specifically for that work.

Ambassador David Cohen told CBC's The House in an interview airing this weekend that Canada needs to make Arctic air and maritime defence a national priority. He said he's made that point in "candid conversations" with senior cabinet ministers since he took up the post in December.

"So I think there's an acknowledgement that this budget does not include funding for NORAD, for modernizing and improving the northern defence for Canada and for the United States, but that it will be forthcoming during the course of this fiscal year," he said.

The U.S. has complained for a very long time that Canada hasn't been living up to its NATO commitment to boost its military spending to two per cent of national GDP. Barack Obama raised it during his speech to Parliament in 2016 when he was president. Donald Trump took up the refrain even more assertively during his time in the White House.

Cohen isn't a career diplomat or politician. He is, on the other hand, a successful business executive and lobbyist, a man described by the Washington Post a decade ago as a policy wonk with extensive Beltway contacts and an ability to distil complex issues.

Those are also useful skills in Ottawa — where politicians pay far more attention to what goes on south of the border than their American counterparts display when it comes to Canadian politics.

CBC News: The House19:15U.S. Ambassador says Canada needs to make Arctic defence a ‘national priority’

U.S. Ambassador David Cohen sits down with host Chris Hall to reflect on the state of the Canada-U.S. relationship and next steps on NORAD modernization, Arctic defence and integrated supply chains.

Russia and China make play for Arctic resources

But North American security is one subject the U.S. cared about deeply long before Russian President Vladimir Putin invaded Ukraine, and long before China began asserting itself as a polar power with a claim to the Arctic's resources.

Cohen acknowledged during the interview at the U.S. embassy that the budget did include another $8 billion in defence spending. But he said Russia and China's increasing activity in the North must be countered by a more robust Canadian presence at the top of the world.

"The United States has been told, I have been told and other officials in the White House and in Washington have been told that when we discussed the $8 billion increase in defence spending, (we've) been told that, remember, that doesn't even include anything for NORAD modernization," he said. "That will be an add-on as we continue to review what NORAD requires."

Liberal MP John McKay estimates the cost of modernizing NORAD could run to billions of dollars.

McKay, chair of the Commons defence committee, has been a vocal critic of Canada's failure to respond to Russia's growing military presence in the Arctic. He told CBC News that Russia has built or refurbished 11 bases across the region, while Canada has only one base in Alert.

"There is an absolute necessity for the government of Canada to be alive to the military needs of the Arctic," he said when asked for his reaction to Cohen's comments.

"We have underestimated, continuously underestimated, Putin's willingness to engage in a military fashion over the last number of years. And we cannot afford that risk."

But the prime minister has been unclear about Canada's position. Justin Trudeau told reporters this week that security is only one part of his government's focus in the North. Addressing climate change and promoting economic opportunities for the Inuit are equally important, he said.

"We are in a time of of reflection around how we ensure Canada's continued sovereignty in the Arctic, and in times past or governments past that would have happened through a military lens," he said Thursday after announcing a new engagement policy with Inuit.

"Can we put more bases in the North? Can we show that we're ready to defend and control our Arctic? What this policy, and quite frankly, the relationship that we've built over the past number of years in the Crown-Inuit partnership [shows] is [that] sovereignty in the North passes through the people who live there and who have lived there for millennia."

A spokesperson for Defence Minister Anita Anand said Arctic defence is a key government priority.

Daniel Minden wrote in an email that the 2021 budget included $252 million over five years in initial military funding, "with new investments in situational awareness, modernized command and control systems, research and development, and defence capabilities to deter and defeat aerospace threats to this continent."

The email also says that Budget 2022 goes further by "investing $6.1 billion in increased capabilities for the Canadian Armed Forces, including continental defence."

Co-operation on shared defence priorities isn't the only file to land on Cohen's desk since he arrived in Ottawa just before anti-vaccine mandate protests locked down the nation's capital for weeks.

Compromise on EV tax credit in the works: Cohen

Trade and climate change are two other topics where there's potential for conflict.

The Trudeau government lobbied hard last year for Canada's exemption from a proposal in President Joe Biden's now-defeated Build Back Better bill that would have given a $12,500 tax credit to buyers of electric vehicles — provided the vehicles were made in the U.S. by unionized workers.

Cohen said the proposed tax credit to boost U.S. electric vehicle sales isn't dead, but a compromise to ensure Canadian auto parts suppliers aren't shut out is in the works.

"I'll remind you that the prime minister actually threw out a possible solution to that, which is that if the U.S. legislation was rewritten to be North American, that Canada would entertain increasing its credits for electric vehicles, which tend to be in the form of consumer rebates," he said.

Cohen also sought to alleviate concerns about U.S. protectionism, and any lingering concerns about the shutdown of the Ambassador Bridge by protesters in February, by pointing to a speech this week by the director of Biden's National Economic Council, Brian Deese.

"He said a lot of things in that speech but the headline for this question is that it is not possible for the United States or any country to domestically produce 100 per cent of the components of our supply chain," Cohen said. "We need to have strong partnerships and relationships with allies in order to secure a reliable and resilient supply chain.

"So there's now a direct answer from the White House to your question [about] whether the desire and commitment to maintain and grow the interconnectedness of the supply chain between Canada and the United States remains."

• Listen to CBC Radio's The House: America's man in Ottawa