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Trump Testing Canada With Tariffs 08/24 06:18
Mark Carney drew international attention as Canada's prime minister by
warning that middle powers must resist economic coercion by more powerful
countries. Now President Donald Trump is putting that warning to the test with
sweeping new tariffs that could show how much economic pain Canada can absorb.
TORONTO (AP) -- Mark Carney drew international attention as Canada's prime
minister by warning that middle powers must resist economic coercion by more
powerful countries. Now President Donald Trump is putting that warning to the
test with sweeping new tariffs that could show how much economic pain Canada
can absorb.
Tensions escalated late Friday when Canada walked away from negotiations
after Carney concluded the United States was demanding too much in exchange for
tariff relief. The U.S. imposed 50% duties Saturday on about $20 billion worth
of Canadian goods, and Carney announced dollar-for-dollar retaliation beginning
Sept. 8.
"We're going to hit back," Carney said.
Carney is doing what many other American allies have so far avoided: risking
economic pain rather than yielding to tariff pressure.
For Carney, the showdown is the clearest test yet of his argument that
middle powers must stand up to economic pressure from great powers such as the
United States and China, even when it comes at a cost. Canada's response could
show how countries navigate a world in which long-standing alliances offer less
protection and economic ties themselves become sources of leverage.
It could also shape how Carney is viewed at home and abroad, and how other
U.S. allies respond to the Republican president.
The trade dispute also has become a test of sovereignty.
Carney said Washington introduced language in the final hours of
negotiations that would have restricted Canada's ability to make trade deals
with other countries. He said that demand was "unacceptable" and "a question of
sovereignty."
British Columbia Premier David Eby said accepting such a condition would
have reduced Canada "to the economic equivalent of the 51st state" -- a status
Trump has mused about often.
Canada becomes a test case for the world Carney warned about
Carney's message resonated in January when he addressed the World Economic
Forum in Davos, Switzerland, as Europe braced for Trump's threats over
Greenland and new tariffs.
Carney said the international order was undergoing "a rupture, not a
transition." He argued that sovereignty would depend increasingly on a
country's ability to "withstand pressure" and warned that middle powers
negotiating alone with great powers do so from weakness.
Trump responded a day later by stressing Canada's dependence on the United
States. " Canada lives because of the United States," he said. "Remember that,
Mark, the next time you make your statements."
The president has repeatedly talked about making Canada the 51st U.S. state
and dismissed the allies' border as artificial. On Sunday, Trump returned to
that theme, writing on Truth Social that "Canada wants the benefits of being a
State, without being one!!!" and accusing Canada of charging U.S. farmers
"massive amounts" of tariffs for years. "No more!!!" he wrote.
Seven months since Davos, Canada has become a test case for the world Carney
described.
"Our government understood, before many, that America would transform all
its commercial relationships," Carney said Saturday. He accused Washington of
using "economic integration as a weapon" and said its "signature was written in
pencil."
The price of resistance and will Canada show the way?
Historian Robert Bothwell said Canada is uniquely vulnerable to U.S.
pressure.
"No country is more exposed than Canada," Bothwell said. "Other countries
have to fear American misbehavior, but none as much as Canada."
Bothwell said success ultimately means Canada retaining its independence "in
the face of Trump's desire to subordinate it and absorb it." He said Carney
"sees that very well."
But Canada's dependence on the U.S. market makes that difficult.
Nearly three-quarters of Canadian exports go to the United States, whose
economy is roughly 10 times larger. Canada can sign new trade agreements, but
replacing customers and supply chains built around the enormous U.S. market
over decades is considerably harder.
Carney acknowledged retaliation would "raise costs and reduce choice for
Canadians."
U.S. Trade Representative Jamieson Greer rejected Canada's account of the
breakdown in talks, saying Ottawa introduced new demands and backed away from
commitments even after Washington offered to reduce tariffs on steel, autos,
lumber and other goods.
He said the United States was moving ahead with additional measures in
response to Canada's retaliation, raising the prospect of further escalation.
The European Union prepared retaliatory tariffs against the United States
last year but repeatedly suspended them while negotiating with Washington.
Nelson Wiseman, a professor emeritus of political science at the University
of Toronto, said Canada is providing the biggest test yet of whether Carney's
strategy can work and whether resistance by one middle power could change the
calculations of others.
"Will there be a domino effect? We'll see," Wiseman said.
Carney's defiance also drew notice in Europe. Former Italian Prime Minister
Paolo Gentiloni, who later served as the European Union's economy commissioner,
shared video of Carney's Saturday remarks on social media and wrote, "Here is a
speech I would like to hear in Europe."
Carney tries to hold the line as anger grows among Canadians toward Trump
Ian Bremmer, president of the Eurasia Group, said Americans underestimate
how angry Canadians are with the Trump administration.
"Taking a hard line in response to U.S. policy perceived as predatory --
even with major economic cost to Canada -- is popular among most Canadians," he
said in a social media post.
The confrontation is also reviving calls to shun U.S. goods. Quebec Premier
Christine Frchette urged residents to buy local, calling it "a nationalistic
action" and "an action of solidarity."
That anger again spilled into sports over the weekend. Fans in Vancouver and
Montreal booed the U.S. national anthem before Major League Soccer matches
Saturday, echoing similar scenes early in the trade war last year.
Manitoba Premier Wab Kinew said Canadians should be prepared for a prolonged
confrontation and that Trump could emerge weaker after the U.S. midterm
elections in November.
"He's got two more years left in office. We should be prepared to duke it
out for two years, and then hopefully, sanity will return," Kinew said.
Carney has framed the confrontation as a test of whether Canada can preserve
its independence under U.S. pressure.
"Last spring, I warned that America is trying to break us so that they can
own us," Carney said Saturday. "And I promised: 'That will never, ever happen.'
We are keeping that promise."
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