Prime minister Mark Carney is regularly criticized by the opposition Conservatives for not signing a new trade deal with the United States since last spring’s federal election.
However, as Canada moves deeper into a trade war with the U.S., Carney’s long-game strategy seems to be the right approach.
After a few rounds of jumbled threats and chaotic demands, U.S. president Donald Trump seems to have settled on a 35 per cent tariff on most non-energy goods from Canada that are not covered by the Canada-U.S.-Mexico Agreement, a 10 per cent tariff on energy products and potash, and a 50 per cent tariff on steel and aluminum products.
SASKATOON — Canada has a massive trade infrastructure deficit that needs to be addressed, according to a company that finances…
He recently threatened an extra 10 per cent levy because of a television ad that included a speech by former president Ronald Reagan about tariffs that the Ontario government aired on U.S. networks.
This tariff may still be coming, who knows.
Trump cancelled all trade negotiations with Canada because of the ad, and this may end up being the best thing that could have happened for Canadian interests.
That’s because cracks are beginning to form within Trump’s control over U.S. government structures, and his bargaining position with Canada may soon weaken.
The U.S Supreme Court has a six to three conservative majority, including three justices Trump appointed during his first term.
However, even some of the justices who Trump appointed have signalled that his tariffs are an overreach because the imposition of taxes on Americans has always been the core power of Congress.
If the U.S. Supreme Court strikes down the tariffs that Trump placed on Canadian goods, he will likely find another excuse to re-impose them.
However, it is a positive sign that a branch of government designed to serve as a check on the president’s power may not be completely in his pocket.
Republicans were also dealt significant losses a few weeks ago, including the governor’s races in Virginia and New Jersey and the mayoral race in New York City.
This may not bode well for Trump’s prospects in the midterm elections next year, and his ability to enact foreign and domestic policies will be greatly reduced if Republicans lose control of Congress.
There are signs the historic bull run that stocks have experienced may be coming to an end, and if the stock markets do begin to slide, the U.S. administration will be under pressure to remove trade uncertainty, including with its largest trading partner, Canada.
It’s unfair to ask the people, communities and industries most affected by Trump’s tariffs to be patient when it comes to trade negotiations with the U.S.
Unfortunately, there isn’t a fool-proof way to manage the bilateral relationship with the U.S. while its president is a fool. Even if we sign a deal with him today, there is no indication he will respect it tomorrow.
Other countries have recently signed trade deals with Trump, and they will have to live with them even after he’s gone.
Canada has more on the line when it comes to trade with the U.S. compared to any other country.
Waiting for the right trade deal with the U.S. is much more important than signing a deal that provides short-term stability at the cost of long-term prosperity.
Karen Briere, Bruce Dyck, Robin Booker, Paul Yanko and Laura Rance collaborate in the writing of Western Producer editorials.
