Carney pledges defence spending, takes aim at Trump; Freeland unveils economic plan

Liberal leadership candidate Mark Carney delivers remarks in Windsor, Ont., Feb. 5, 2025. (CTV News)

Liberal leadership hopefuls Mark Carney and Chrystia Freeland unveiled parts of their policy planks Wednesday, both taking aim at U.S. President Donald Trump and pledging to attract investment, among other promises.

In a Wednesday morning press conference in Windsor, Ont, Carney pledged Canada will hit the NATO defence spending target sooner than currently projected, cancel the capital gains tax increase and give a tax cut to the middle class if he becomes prime minister.

“My government would work to reach two per cent of GDP and defence spending by the end of this decade and pull our full weight in NATO,” Carney, the former governor of the Bank of Canada and the Bank of England, told reporters.

Canada is one of the few NATO countries that has yet to meet the alliance’s decade-old agreed-upon goal to spend two per cent of GDP on defence. Prime Minister Justin Trudeau pledged this summer to meet the target by 2032, eight years after the original deadline, though some officials have said it could be reached sooner.

Canada has faced widespread criticism for its failure to meet its spending promise, and the issue has been a sticking point in the alliance. Trump’s re-election, meanwhile, has added a new sense of urgency, considering the commander-in-chief’s at-times perilous comments about NATO and his push to boost defence spending to five per cent of GDP.

According to an October report from the Parliamentary Budget Officer, defence expenditures would need to reach $81.9 billion by 2032-33, almost double the projected amount for 2024-25, just to hit the two per cent target.

In his announcement, Carney also committed to cut red tape on infrastructure projects, break down interprovincial trade barriers and diversify our trading relationships, particularly in the face of Trump back in the White House.

“The Government of Canada has extraordinary powers at its disposal today to respond to a national crisis, and Donald Trump’s aggression against Canadian livelihoods and workers constitutes just such a crisis,” he said.

The U.S. president announced on Monday he is giving Canada a 30-day reprieve on the significant tariffs he’d been threatening, pending progress on border control measures. He has cited the fentanyl overdose crisis as his primary justification for the trade war.

Trump has also repeatedly referenced the U.S. trade deficit with Canada and his intention to renegotiate the trilateral free trade agreement with Canada and Mexico, and his desire to see Canada become a state.

“We need to be crystal clear about our bottom lines,” Carney said. “This proud country will never be part of the United States in any shape or form.”

He added that while “U.S. priorities are shifting,” Canada also needs to adapt, and diversify its trading relationships, particularly when it comes to energy and security, to avoid putting “all our eggs in one basket.”

“There’s a fever gripping America, and while it rages, Canadians will remain resolute and true to our values,” Carney also said. “While America engages in a war on woke, Canadians will continue to value inclusiveness. While America shuns the vulnerable, we will continue to show solidarity with one another, and while America attempts to turn back the clock, Canadians will build sustainability for future generations.”

Carney is also promising to cut spending and make the Canadian government more effective, but says he will keep the cornerstone Trudeau Liberal programs, such as dental care and child care, because they’re “helping millions of Canadians.”

“The point I was making, which I took too long to make, perhaps, but the point I was making was that it’s about where we go from here, looking forward, and more of an emphasis on policies that catalyze business investment,” Carney said. “It’s a time to build.”

Freeland unveils 10-pillared economic plan

Carney and Freeland are widely considered the frontrunners in the Liberal leadership race, alongside Government House Leader Karina Gould.

In a statement Wednesday afternoon, former deputy prime minister and finance minister Freeland — who has attempted to position herself in the campaign as the best person to take on Trump — also laid out her economic plan, stating Canada “must take bold action,” especially in light of the U.S. president’s “economic nationalism.”

She is promising to leverage federal transfers in a meeting with the country’s premiers on day one of her becoming prime minister, to “eliminate interprovincial trade barriers,” calling on the provinces to do so within 30 days of that meeting.

She also promises to “streamline foreign credential recognition in skilled trades and health care,” attract investment, cut red tape and fast-track projects, specifically in critical minerals, and “bolster” that sector.

Freeland also laid out plans to support the trades workforce — including making trade schools free — and focus procurement on buy-Canadian, specifically in defence.

The Liberals will select their new leader on March 9.

With files from CTV News’ Colton Praill