Great new military spending, Canada. Wheres the money going to come from? [Video]

Todd Hirsch is a Calgary-based economist, author and public speaker. He is also the director of the Energy Transition Centre.

Canada will reach NATO’s defence spending benchmark of 2 per cent of GDP this fiscal year – five years earlier than planned.

That’s according to an announcement on Monday by Prime Minister Mark Carney. The move is timely and necessary in an unstable world.

Ottawa is upping this year’s budget for the Department of National Defence by $9.3-billion. That and existing spending from other departments will push defence-related expenditure to $62.7-billion for 2025-26 – 2 per cent of GDP, as per the requirements of the North Atlantic Treaty Organization.

Never mind that the rest of NATO now wants to meet U.S. President Donald Trump’s demand of 5 per cent. The fact that we, the laggard, finally got our act together and came up with such a bold plan to get to 2 per cent is good news.

Now for the unglamorous part: There’s no magic money tree. Defence can’t surge …