Trump’s Tariffs -- A View from Canada
Everyone knows that there is no love lost between President Trump and Canada’s failed Prime Minister Justin Trudeau. During Trump’s first term, Trudeau never missed an opportunity to thumb his nose at the president and badmouth him behind his back.
But Trudeau has now resigned, and his Liberal party with its disastrous policies is way behind in the polls. There will be an election in Canada this year, possibly as early as two months hence, and in Canada as in America, elections have consequences. During the last Conservative government under Prime Minister Steven Harper, Canada weathered the subprime economic crisis better than any other G-7 country, while during the present economic crisis under Justin Trudeau, Canada is doing the worst. Regardless of the merits of Trump’s case against Canada for not securing its border, the trade war which he threatened and then paused for one month has thrown a wrench into the works of political jostling in advance of Canada’s upcoming election and presumably not in ways that he would have wanted.
Although Canada’s conservatives are not exactly the same as America’s, there is a huge amount of common ground between them. Conservatives on both sides of the border value lower taxes, secure borders, peace through strength, family values, and strong market economies. Moreover, regardless of who is in power on either side of the border, despite occasional differences Canada and America are natural friends, not enemies. In that respect the Trudeau regime has been a huge aberration.
Across the board tariffs are a blunt instrument. Canada is not Mexico. Mexico’s previous President Andrés Manuel López Obrador used to brag about the millions of illegal aliens that were residing in the U.S. and encouraged them to vote Democrat. Moreover, by exploiting America’s welfare system, Mexicans living in the United States are annually able to free up $63 billion in remittances to send back home, thereby giving a big boost to Mexico’s economy on top of the $140 billion balance of payments in Mexico’s favor.
No Canadian prime minister has ever bragged that millions of indigent Canadians are living in the U.S. and using its welfare resources to free up money to send back home. Canada has its own strong welfare system and neither needs nor wants to send Canadians to exploit America’s. On the contrary, the vast majority of people moving to the United States from Canada are legal immigrants and Canada has forever been losing some of its most talented people to America. Almost everyone in Canada knows someone who moved south of the border to help make America great. My late cousin David Turner worked for NASA as a microbiologist during the early years of space flight when it was found that returning astronauts experienced a post-flight visual impairment syndrome and he succeeded in correcting it by administering large doses of vitamin A. Back in the day this southward movement of talent was so great -- it was colloquially referred to as a brain drain -- that during the 1960s and 70s the Canadian government attempted to counter it by sending letters to Canadian students studying in the U.S. urging them to come home where great employment opportunities awaited them. This trend continues to this day.
How does Trump’s threat of tariffs affect the upcoming Canadian election? When Trump threatened Canada with 25% across-the-board tariffs, this threat was perceived as a national emergency, but parliament was and still is prorogued. If Trudeau was an honorable man, he would have ended the prorogation so that he could call the House of Commons into emergency session to have a national debate about how to respond. But he did not do that, because in parliament the Conservatives would have demonstrated that this crisis was due to Liberal policies. Therefore, instead of a good healthy parliamentary and national debate about how we got here, Canada was instead treated to a war of the pressers between Trudeau and Conservative leader Pierre Poilievre.
Moreover, these pressers took place in an atmosphere of existential crisis. For any nation, the threat of war, even a trade war, naturally forces the opposing political parties to close ranks, every party trying to outdo the other at sounding patriotic. Nor did it help that Trump’s tariff threat came hard on the heels of his threat to annex Canada. Therefore, in these dueling pressers Poilievre was forced to announce similar retaliatory trade war measures -- dollar-for-dollar tariffs, removal of inter-provincial trade barriers, engaging with alternative trading partners, etc. Unfortunately, Poilievre was unable to go mano a mano with Trudeau about what brought Canada here in the first place.
The upcoming election is as important to Canada as was the November election in the United States. It’s hard to say what effect Trump’s rhetoric is having on the political climate in Canada leading up to it but it cannot be doing any good for the prospects of the Conservative party. Just as is the case in the U.S. the mainstream media in Canada have long been demonising Trump and his call to make Canada the 51st state has revolted most Canadians. In a poll conducted by Abacus Data between February 5 and 11 the Conservatives continue to lead the Liberals 46% to 27% among committed voters but the needle isn’t static. As was to be expected, because of the ongoing leadership race the Liberals have experienced a 5% bump in the polls while the Conservatives have experienced a 3% bump. The erosion of the Conservative lead is not a good thing because if Canada hopes to restore its goodness as a nation the Conservatives need not only to win but to be able to form a majority government.
This crisis is absolutely unnecessary. Trade between Canada and America is on a fairly level playing field. Canada’s wages and workplace safety are equivalent to America’s. Moreover, NAFTA was renegotiated during Trump’s first term with a tough American negotiator and if Trump wanted to revisit those negotiations Canada would not refuse.
The real issue is border security and here’s the thing: the bad guys in Canada come from the same noxious stew as those in America, and Canadians likewise deplore them. And the fentanyl that is killing Americans comes from the same source as that which is killing Canadians and Canadians deplore that too.
At the beginning of this crisis, Trump refused to even talk to Canada’s foolish leader. After Trudeau was finally allowed to visit Mar-a-Lago he came back saying that he had had a “good talk” with the President and that the Liberals were going to spend 1.4 billion dollars in the next five years to hire 10,000 border guards. This may have impressed Trudeau’s base, but the way these things go it is unlikely that it will be implemented before the next election. If Trudeau were sincere, he could have immediately called on the RCMP and the army to start securing the border. Instead, he wrapped himself in the flag and announced that he was going to wage a trade war with America with dollar-for-tariff dollar.
This is election season in Canada and by appealing to Canadian patriotism, Trudeau is hoping to give his party a boost. In that sense, the Trudeau Liberals are trying to do what their Democrat cousins in America like doing, “never let a crisis go to waste.” Meanwhile, Trump has maintained that America is self-sufficient and does not need to trade with Canada, forcing Canadian leaders to say the same. It would be so much better for everyone to tone things down. The traditionally heavy trading between the two countries did not arise out of thin air nor is it based entirely on convenience. It has benefitted both nations, as does all fair trade and helped tie together natural friends. It is tragic that the relationship between the two countries is being harmed by baseless politics.
Image: AT via Magic Studio