Published in The Lance, student-run newspaper of Livingston High School, Vol. 69 Issue 01
U.S.-Canada Divided As Trade War Continues
The U.S. and Canada share a crucial trade relationship: Canada is America’s second largest trading partner, and America is Canada’s largest trading partner. Recently, this relationship has come under strain.
On July 19, President Donald Trump announced 50% tariffs on $20 billion worth of Canadian imports, including vehicles, dairy, hockey sticks and alcohol, to take effect on August 19. The move was seen by some economists as the U.S. attempting to gain leverage in their ongoing trade talks with Canada. Regardless, after talks collapsed, the tariffs took effect on August 21.
Canadian Prime Minister Mark Carney responded promptly, stating Canada would “match those tariffs dollar for dollar.” On August 265, he announced $20 billion of tariffs on American goods, including steel, aluminum and dairy.
Canadian lawmakers began looking into expanding trade with other markets, like that of the European Union, and have halted plans to buy 88 F-35s from the U.S. (although they have already acquired 16 planes).
On August 27, Trump signed an executive order renaming Lake Ontario, situating on the U.S.-Canada border, to Lake America, a move which CNN correspondent Anna Stewart described as a “jab” at Canada. In respond, Ontario Premier Doug Ford erected an 18-foot sign on the lake stating “Lake Ontario / Now and Always.”
On September 8, after Canadian counter-tariffs took effect, Trump announced a ban on the import of Canadian motorcycles, dairy, and alcohol, to take effect on September 29, and expansions of the existing 50% to cheeses, boats, and other goods (exempting products like rock salt and cement), which took effect on September 15.
The trade war is set to have a dramatic effect on both nations’ economies. The Royal Bank of Canada stated that not reaching a deal would impact 0.4% of GDP and employment. University of Calgary economics professor Trevor Tombe projects the move could cost 87,000 jobs. In the United States, this conflict will put strain on the nation’s steel and automative industries and likely raise prices in both countries.
Additionally, as pointed out by journalist Max Zahn, it could have a major impact on the upcoming midterm elections.
Canada is the largest trading partner of Maine, Michigan, and Ohio, states where competitive races are underway. Candidates across the nation have responded to Trump’s actions, including Abdul El-Sayed (D-MI), who stated in an August 31 press conference, “There’s a smart use for tariffs, this ain’t it,” as reported by The Hill, and Senator Susan Collins (R-ME), who called on Trump to exempt certain products from tariffs.
More broadly, the U.S.-Canada trade war could impact U.S. trade relations with other nations. Previously, the European Union, United Kingdom, Japan, and South Korea had agreed to lower tariffs on American goods to continue trade. However, Canada’s decision to retaliate, rather than accepting U.S. tariffs, could influence future negotiations. As journalist Nik Martin writes in DW, other governments are “watching to see how standing up to Trump plays out.”
