If President Donald Trump is a bully, as many Canadian politicians and pundits claim, so what? The accusation will not ease the economic impact of any tariffs the US imposes on Canadian exports.
In that context, Monday’s stay of execution on Trump tariffs, now delayed for at least a month, comes as an immense relief to hundreds of Atlantic Canadian export businesses in sectors ranging from lobsters to lumber to tires to energy.
Further, from our vantage point in CrowsNest, it doesn’t look as if Canada paid too steep a price for the brief reprieve the US has announced on its threatened trade actions against this nation and Mexico.
Recognizing drug cartels as terrorist organizations, as the US requested, hardly seems like a stretch. Canada has also pledged to appoint a fentanyl czar and work with US law enforcement officials inside a bilateral joint task force to combat cross border traffic in deadly opioids.
Canadian officials insist this country is not a major source of fentanyl destined for US markets, and the numbers in part substantiate this claim. The US Customs and Border Protection reported that it seized under 20 kilograms of fentanyl at the Canadian border in 2024, compared to 9,570 kilos at Mexican border crossings.
But these numbers are not merely revealing. They are also disingenuous. The New York Times, hardly a propaganda arm of the Trump government, has reported that Canada is coming into its own as a manufacturer of fentanyl rather than merely serving a as gateway for drugs produced in other nations.
As it is with opioids, so it is with people. Increasing numbers of illegal migrants are crossing into the US from Canada. In short, the trendlines on drugs and people traffic across the border are troubling to the US – as they should be to Canada. The Trudeau government, by meeting Trump’s requests to combat illegal drug shipments, is belatedly addressing our own national interest – and America’s.
What else is President Trump asking of Canada?
Too much, in some ways. His suggestion that the country might make an ideal 51st state was over the top, though it at least brought Canadians together in a rare rally-round-the-flag moment. Trump’s trade offensive also gave way to a recognition that the interprovincial trade barriers should be lowered inside the country, to facilitate efficiencies and a more competitive economy.
Like his predecessors for the past half century, Trump would also like this nation to meet its own target (two per cent of GDP) for military spending, as it should do. Canada (and many other NATO allies) have been living cozily under a US security blanket for decades.
Trump is also echoing the views of earlier presidents by lobbying Canada to stop subsidizing certain ‘sacred cow’ sectors – starting with the holy Holsteins which produce most of the nation’s milk. Canada’s dairy sector is generously subsidized or otherwise protected, as are its agricultural industries more broadly, its cultural industries, its banks, and its telco sector.
Should Canada cave into this president’s demands? Absolutely not, but we should consider whether it is really in our national interest to protect a telco industry (for instance) that delivers cell phone services at some of the highest costs on the planet. Most importantly, we should take reasonable actions to avoid a trade war Canada can’t win against the US, whose economy (the world’s largest) is going gangbusters. Canada must also recognize that the US is far and away its best customer, importing almost 90 per cent of our export sales.
Yes, Canada can mitigate the risk of its dependency on US markets over the long term by aggressively pursuing new export markets. That’s a long game, though. Our immediate need is striking a new deal with our largest and grumpiest customer – and its most unpredictable one under President Trump.
In short, Canada should seek to protect its national economic and security interests by working with US officials to extend the tentative trade agreement – or should that be arrangement? – reached this week.
If this means compelling our complacent and protected economic sectors (telcos, agriculture, banks and the rest of them) to compete globally, Canada will be better off for it.
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