Canada considers 'extreme tail risk' of US military action, Carney says

You have a responsibility to look at extreme tail risk
Carney explains why his government examined the possibility of US military action despite considering it highly unlikely.
Mark

So Carney is saying Canada needs to prepare for the US to attack it. That sounds alarming.

Mimi

Not quite. He's saying his government has examined the possibility as part of responsible risk management—the kind of scenario planning any government does. He's explicit that it's not the base case, not what he expects.

Luke

Right, but "extreme tail risk" is doing a lot of work there. That phrase means something that's theoretically possible but extremely unlikely. The question is: what triggered this examination now? Is it Trump's rhetoric, or something deeper?

Mimi

Trump has made jokes about shooting Canada, there are trade disputes, tariff threats. The relationship is visibly strained. Carney seems to be saying: given the unpredictability, we have to think about contingencies.

Mark

But what preparations? Carney doesn't say what they actually considered.

Luke

Exactly. We know Canada is increasing defence spending to 4 percent of GDP by 2030. That's real and verifiable. But whether that's a response to this tail-risk thinking or just general military modernization—we don't know from this reporting.

Mimi

The timing suggests they're connected. Carney makes the tail-risk comment, then immediately discusses the defence spending increase. It reads like he's saying: we're taking our security seriously.

Mark

The military numbers are pretty stark though. Two million US personnel versus 200,000 Canadian. Sixty-five US submarines to Canada's four.

Luke

Those numbers are real and they matter for context. But they also raise a question: if the imbalance is that severe, what would "preparation" even mean? Is it realistic?

Mimi

Maybe it's not about winning. Maybe it's about having enough capability that the scenario becomes even less likely—deterrence through strength, even if the strength is asymmetrical.

Mark

So the spending increase is partly about making the tail risk even more remote.

Luke

That's one reading. Another is that Canada is modernizing its military for Arctic sovereignty and other reasons, and Carney is using the tail-risk language to justify the spending politically.

Mimi

Both could be true. The spending is real either way.

  • Canada's prime minister has publicly confirmed that military conflict with the United States — however remote — has entered the government's formal risk calculations, a disclosure that signals just how far bilateral relations have deteriorated.
  • Trade wars, tariff disputes, and sovereignty friction since Trump's return to office have pushed the Canada-US relationship into territory that feels less like a partnership and more like a negotiation under duress.
  • The military imbalance is stark and sobering: the US fields over two million personnel and 65 submarines to Canada's fewer than 200,000 troops and four submarines, making any confrontation a deeply asymmetric proposition.
  • A reported exchange in which Trump jokingly suggested Canada faced risks from Washington — 'Maybe they'll shoot you' — has become, in Carney's telling, a symbol of the current unease between the two nations.
  • Canada is responding with its largest defence spending increase since the Second World War, targeting 4% of GDP by 2030 — a signal of both strategic seriousness and a determination to act with greater independence.

In an era when the unthinkable has become the merely unlikely, Canadian Prime Minister Mark Carney has acknowledged that his government has quietly examined the possibility of military conflict with its most powerful neighbor — not as a prediction, but as an act of responsible stewardship. Against a backdrop of deepening trade disputes, sovereignty tensions, and an asymmetry of military power that defies easy comparison, Canada is choosing to look clearly at the shadows rather than pretend they do not exist. It is a posture as old as statecraft itself: prepare for what you hope will never come.

Canadian Prime Minister Mark Carney has confirmed that his government has examined the possibility of military conflict with the United States — not as a likely scenario, but as what he calls an 'extreme tail risk' that responsible leadership cannot ignore. Speaking to The New York Times, Carney framed the exercise as straightforward risk management: 'It would be irresponsible not to' prepare for even remote contingencies. He offered no details about what specific preparations had been considered.

The admission arrives as Canada-US relations have grown increasingly strained since Donald Trump's return to the presidency. Disputes over trade, tariffs, and the fundamental nature of the bilateral relationship have pushed tensions well beyond ordinary diplomatic friction. At the Canada Investment Summit in Toronto, Carney sought to reassure investors that the two countries would always be neighbors — but insisted the relationship works best when both sides respect each other's sovereignty. He also recalled a moment with Trump himself, in which the president jokingly suggested Canada faced risks from Washington: 'Maybe they'll shoot you.' Carney described the exchange as emblematic of the current climate.

The military arithmetic behind such contingency thinking is sobering. The United States maintains more than two million active-duty and reserve personnel; Canada has fewer than 200,000. The US operates 65 military submarines; Canada operates four. These disparities make any hypothetical confrontation deeply asymmetric — which is precisely why the scenario, however unlikely, commands attention from planners.

Carney's government has responded to the broader security environment by announcing Canada's most ambitious defence spending increase since the Second World War, with a target of 4% of GDP by 2030. Canada's vast Arctic territory and the world's longest coastline have made sovereignty and defence increasingly central to its strategic identity. The spending commitment is both a practical measure and a declaration: Ottawa intends to be taken seriously as an independent actor, whatever pressures it faces from the south.

Canadian Prime Minister Mark Carney has acknowledged that his government has examined the possibility of military conflict with the United States, framing it as an "extreme tail risk" that responsible leadership demands preparing for, even if the likelihood remains remote. In an interview with The New York Times, Carney explained that considering such scenarios falls within the bounds of prudent risk management. "I think you have a responsibility in these roles to look at extreme tail risk," he said. "That's just risk management. That's not a base case, but it would be irresponsible not to" prepare for it. He did not elaborate on what specific preparations his administration had considered or what form such contingency planning might take.

The remarks arrive against a backdrop of deteriorating relations between Ottawa and Washington. Since Donald Trump returned to the presidency, disputes over trade, tariffs, and the fundamental character of the bilateral relationship have created friction that extends well beyond the usual diplomatic disagreements between neighboring nations. Carney has sought to balance acknowledgment of these tensions with reassurance about Canada's commitment to the partnership. Speaking at the Canada Investment Summit in Toronto, he told investors that Canada and the United States would always be neighbors, but that the relationship functions best when both countries operate as true partners respecting each other's sovereignty and traditions.

The strain in the relationship became apparent in an exchange Carney recalled with Trump himself. The US president, in what Carney characterized as a joking manner, suggested that Canada faced risks from its relationship with Washington. "Maybe they'll shoot you," Trump said, according to Carney's account. Carney described this episode as emblematic of the current state of affairs between the two countries. Despite the tensions and the acknowledgment of tail-risk scenarios, Carney indicated that Canada remains open to negotiating a mutually beneficial agreement with the United States. He noted that approximately 80 percent of trade between the two nations currently moves across the border without tariffs.

Canada's military position relative to the United States underscores why such contingency planning, however remote the scenario, might occupy the attention of government planners. The United States maintains more than two million active-duty and reserve military personnel, compared with fewer than 200,000 in Canada's armed forces. The disparity extends to naval capabilities: as of 2024, the US operates 65 military submarines while Canada operates four. These figures illustrate the stark asymmetry that would characterize any military confrontation between the two nations.

In response to the broader security environment and the need to strengthen Canada's position, Carney's government has announced plans for the country's most significant increase in defence spending since the Second World War. The government has set a target of reaching defence expenditures equal to 4 percent of GDP by 2030, a substantial commitment that reflects Ottawa's determination to enhance both military capability and economic resilience. Canada's geography—its vast Arctic territory and the world's longest coastline—has made questions of defence and sovereignty increasingly central to how the government approaches its relationship with Washington and its broader strategic posture. As tensions persist and military imbalances remain stark, these investments represent both a practical response to security concerns and a signal about how seriously Ottawa takes its ability to act independently.

I think you have a responsibility in these roles to look at extreme tail risk. That's just risk management. That's not a base case, but it would be irresponsible not to prepare.
— Mark Carney, Canadian Prime Minister
We will always be neighbours. But we are at our best when we are true partners that respect each other's traditions and sovereignty.
— Mark Carney, speaking at the Canada Investment Summit in Toronto
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