Watching And Waiting

 

My friend Dave from Winnipeg called last night, and, as often happens, talk to turned to politics. I expressed my growing doubts about Mark Carney's ability to effectively negotiate with Trump, given his myriad concessions to the Mad King, about which I have written many times in this blog. Dave, on the other hand, seems to still feel a measure of cautious optimism about our prime minister, suggesting that compromise is always necessary when dealing with someone as unhinged as Trump.

I suspect that August 19th, the day Trump's threats about new 50% tariffs on a range of Canadian goods (including CUSMA compliant ones) are supposed to go into effect, will go a long way toward settling the question. Doing nothing will only invite more rapacious abuse. A strong response, some will argue, will invite even harsher retaliation from Trump. Ultimately, however, we have to ask whether our sovereignty is something we prize above almost all else, or merely a fungible and quaint concept.

Toronto Star letters to the editor offer some thoughts on the matter:

How Canada should retaliate to Trump’s tariffs

Trump has threatened a 50 per cent tax on some more Canadian exports to the U.S., July 20

So, Trump wants to tax Canadian exports to the U.S. at 50 per cent, but not all exports. He has exempted energy and potash. I wonder why? Is it because a 50 per cent tax on petroleum would be paid by all consumers in the US? A tax of 50 per cent on potash would massively increase the cost of fertilizer to U.S. farmers which, not inconsequentially, mostly voted for Trump.

I think that if Trump’s 50 per cent tax does go into effect Canada ought to impose a 50 per cent export tax on energy and potash which would be borne by U.S. consumers and farmers. Canada could send the proceeds of the tax to the provinces where the products originated. The provinces could then distribute the proceeds to the affected companies. It would not likely make them entirely whole because there would be some drop in demand due to the higher cost, but it would mitigate the loss.

David Crowe, Toronto

The suggestion by Cameron McCuaig (Letters, July 27th) that Canada is overly dependent on American goods overstates the case. Virtually everything Americans sell us can be obtained elsewhere at similar or better prices. Examples are winter vegetables (South & Central America) and cars (Korea, Japan and China).

However, the U.S. is highly dependent on Canadian raw materials and energy. There is no easy replacement for Quebec electricity, or western heavy petroleum. There is absolutely no replacement for Canadian potash since Canada is, by far, the world’s largest exporter and producer!

Canadian aluminum is found in every gasoline-powered car’s cylinder head and often cylinder block too. American smelters have been unable to compete and many have closed. Americans have not been buying our copper, cobalt, nickel, softwood lumber and pulp because they “like” us – we offer quality product at a better price.

I would like to see Canada quietly impose a modest (say 5 per cent) export tax on all these goods. Trump would complain, but imposing even more tariffs on us would not be clever. Remember, Trump’s tariffs are actually a tax on Americans!

Let him puzzle out where else these essential commodities could be sourced. Appropriate supply chains would yield higher priced goods (why we were preferred suppliers), and take time to organize.

If Trump didn’t begin to lower tariffs on Canada, within (say) 8-10 weeks, we should bump up the export tax by another 5% - and mount an advertising campaign telling Americans why we were doing this.

This should hit consumers just in time for the mid-term elections. 

Peter Bursztyn, Barrie, Ont.

To fight dependence on the U.S., Canada needs to rediscover its resilience

For more than eighty years, Canada has grown increasingly dependent upon the United States. During those decades, economic integration brought prosperity, a rising standard of living, and the comforting assumption that our closest ally would always remain a reliable partner. Comfort gradually became complacency.

An ancient Japanese proverb observes, “Matters long neglected slowly change in response to the various forces of nature.” Canada neglected to ask a fundamental question: What if the United States ceased to be dependable? Over the past decade, tariffs, economic pressure, and shifting political priorities in Washington have exposed how vulnerable Canada has become to decisions made beyond our borders.

The Gordie Howe International Bridge illustrates this imbalance. Financed largely by Canadian taxpayers at a cost of approximately $6.4 billion, it was intended to generate toll revenues that would recover Canada’s investment. When the United States later sought different financial terms, Canada found itself negotiating from a position of weakness. The episode demonstrated how difficult it is to resist American pressure when so much of our prosperity depends upon access to the U.S. market.

If sovereignty is to be preserved, Canada may need to rediscover the resilience that sustained earlier generations through war, hardship, and sacrifice. Prosperity has brought many blessings, but it has also encouraged dependence. Greater national independence may require greater self-reliance.

Trust is the foundation of every enduring partnership. Once confidence is lost, agreements become suspect, cooperation becomes conditional, and every negotiation is approached with caution. Rebuilding trust is far more difficult than preserving it.

Canada has enjoyed more than eighty years of peace on its own soil, yet history reminds us that nations seldom lose their freedom in a single dramatic moment. Independence is more often surrendered gradually through convenience, complacency and dependence. Canada’s challenge is not merely to protect its prosperity but to ensure that prosperity never comes at the expense of sovereignty. 

John Leberg, Toronto

Just a point of clarification: export taxes are usually borne by the exporter, but those costs are recovered by higher prices charged to the importer. Many, of course,  will cite concerns about domestic unity as a reason not to apply such levies to products from Saskatchewan and Alberta. However, we must ultimately ask this question: Does Canada have what it takes to defend ourselves, no matter the potential cost?

This Explains A Lot

Surveying various reactions to Trump's latest tariff tantrum is an interesting exercise. Paul Krugman, on his Substack, has this to say about Trump's latest threat against Canada:

The Trade Act of 1930, generally known as the Smoot-Hawley tariff, lost its standing as the worst trade policy action in US history when Donald Trump imposed his “Liberation Day” tariffs in April 2025. But Smoot-Hawley was widely recognized as a terrible mistake soon after its passage, as it provoked widespread retaliation and contributed to the downward spiral of world trade that accompanied and reinforced the Great Depression.

The result of all of Trump's 'volatility' ?

 I see an America that has become an ineffectual bully, sicker, poorer, and riven by political extremism, with no friends anywhere in the world.

Barry Appleton observes: 

We are also being singled out. Canada is one of only two nations, with China, that retaliated instead of cutting a deal, and we are punished for it even as U.S. negotiators fly to Mexico this week to talk. That is how you split a bloc, and it works when the other side keeps diving early.

So we play this smart. Stop guarding the wrong post, because the visible date is rarely the real one. Test the weak points in court: a flat 50 per cent, spread across goods that have nothing to do with the discrimination alleged, is hard to defend as the tailored offset the statute requires, Section 338 has never survived a court, and overriding CUSMA invites a challenge Washington has not had to answer. Press all three. But litigation is defence, and defence alone does not win a match.

Some letters to the editor remind us that we all have a role to play in this battle with the U.S.

Re “Trump escalates trade war against Canada with threat to impose 50% tariffs” (July 21): If Donald Trump thinks additional tariffs will pressure Canadians to resume importing and selling American alcoholic beverages, well, think again.

Although he may not believe Canadians are intelligent, we are smart enough to develop other markets for our products.

Luc Lachapelle Hudson, Que.

So California winemakers cheer additional punishing tariffs on Canadians because we will be forced to buy their wine? A better strategy would be asking their government to stop the tariffs, which started the boycotts in the first place.

Cheering for tariffs does not make trading sense, but American culture does not seem to understand the concepts of fairness, kindness and equity, only war and winning.

This Canadian will never purchase California wine or visit the United States ever again. This is not friendship.

Trish Johnston Central Kootenay, B.C.

 Re “Bets off” (Letters, Oct. 28, 2025): Last year, you were good enough to publish a letter in which I suggested that as a result of our dealings with Donald Trump, “our relationship with the United States will be harsh, distant and purely transactional.” Might I be permitted the minor luxury of briefly saying I told you so?

I concluded my letter with the assertion that “we are a resilient people with vast natural resources. We’ll be okay.” I remain of that opinion.

Michael Royce Toronto 

I do not envy Mark Carney in all of this, but I think the majority of Canadians would agree that the time for concessions as acts of appeasement is over. What we do next must be strong, firm, and leave do doubts about our resolve to stand up to an insane president and his increasingly debased nation.