U$A CAN'T BUILD HOUSES WITHOUT CANADIAN LUMBER AND MEXICAN LABOR.
Sky News
Updated Sun, February 2, 2025
President Donald Trump has again threatened Canada in their emerging trade war, repeating that the neighbouring country should become "our cherished 51st state".
The US leader said this weekend that he is imposing 25% tariffs on imports from Canada and Mexico.
The two countries then hit back with retaliatory tariffs and today spoke of working together.
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Trump ignites trade war as Canada and Mexico hit back
Speaking on his Truth Social platform on Sunday afternoon, Mr Trump said: "We pay hundreds of Billions of Dollars to SUBSIDIZE Canada. Why? There is no reason.
"We don't need anything they have. We have unlimited Energy, should make our own Cars, and have more Lumber than we can ever use."
He claimed that without the "massive subsidy" Canada "ceases to exist as a viable country".
He added: "Therefore, Canada should become our Cherished 51st State. Much lower taxes, and far better military protection for the people of Canada - AND NO TARIFFS!"
The Trump administration had said that the tariffs aimed to stop the spread and manufacturing of the opioid fentanyl, as well as pressuring America's neighbours to limit illegal immigration to the US.
But it risks a trade war and higher prices for American consumers. Economists argue supply chains will be disrupted and businesses will suffer increased costs - leading to an overall rise in prices.
Both Mexico and Canada rely heavily on their imports and exports, which make up around 70% of their Gross Domestic Products (GDPs), putting them at even greater risk from the new tariffs.
In his Sunday posts on Truth Social, Mr Trump also took aim at the Wall Street Journal which he said was leading a "Tariff lobby", after the newspaper ran an opinion piece titled "The Dumbest Trade War in History".
Read more:
Why has Trump targeted Mexico and Canada
How Donald Trump's tariffs could impact consumers
Announcing the retaliatory tariffs on Saturday night, Canadian Prime Minister Justin Trudeau delivered a passionate message to American consumers.
"It will have real consequences for you, the American people," he said, saying it would result in higher prices on groceries and other goods.
Mr Trudeau reminded Americans that Canadian troops fought alongside them in Afghanistan and helped them respond to domestic crises including the wildfires in California and Hurricane Katrina.
Canada's ambassador to the US said she hoped the tariffs would not come into effect on Tuesday, but she added she expects the Canadian government to stand firm.
"We're not at all interested in escalating, but I think that there will be a very strong demand on our government to make sure that we stand up for the deal that we have struck with the United States," Ambassador Kirsten Hillman told ABC News on Sunday.
Meanwhile, in Mexico, President Claudia Sheinbaum said: "We categorically reject the White House's slander that the Mexican government has alliances with criminal organisations, as well as any intention of meddling in our territory."
She added: "If the United States government and its agencies wanted to address the serious fentanyl consumption in their country, they could fight the sale of drugs on the streets of their major cities, which they don't do, and the laundering of money that this illegal activity generates that has done so much harm to its population."
Donald Trump has ruptured the Canada-U.S. relationship. To what end? And what comes next?
CBC
Sun, February 2, 2025
U.S. President Donald Trump holds up a signed executive order in the Oval Office of the White House on Jan. 23. (Ben Curtis/The Associated Press - image credit)
Addressing both Canadians and Americans on Saturday night, at one of the most fraught moments in the history of relations between Canada and the United States, Justin Trudeau reminded listeners of John F. Kennedy's words when the late American president addressed Parliament in May 1961.
"Geography has made us neighbours. History has made us friends. Economics has made us partners. And necessity has made us allies," the prime minister said, quoting Kennedy.
Trudeau did not repeat the next sentence in Kennedy's remarks: "Those whom nature hath so joined together, let no man put asunder."
Perhaps that line would have seemed in this moment like a direct attack on the current American president. But Kennedy's sentiment may have been implied as Trudeau proceeded to recount all of the occasions on which Canadians and Americans have fought together and all of the moments in which Canadians have been there to assist their neighbour.
Canadian Prime Minister Justin Trudeau delivers remarks at a Canada-US relations meeting at the Ontario Investment and Trade Centre in Toronto, on Friday, Jan. 31, 2025.THE CANADIAN PRESS/Chris Young
Together, Trudeau said, Canada and the United States have built the most successful economic, military and security partnership the world has ever seen and a relationship that is the envy of the world.
"Unfortunately, the actions taken today by the White House split us apart instead of bringing us together," Trudeau said as he announced how Canada will hit back at U.S. tariffs.
The depth and duration of the split remains to be seen. In the short term, it could be very difficult — not least for those whose jobs and livelihoods are now threatened. And at an anxious moment for the country, Trudeau seemed intent on both pulling Canadians together and preparing them for a significant struggle: "There are many ways for you to do your part," he said.
But even if this rupture is somehow patched over relatively quickly, it's easy to imagine how this could leave the sort of lasting scars that change for the long-term the relationship between two nations that nature hath joined together.
How did we get here?
The United States has now commenced a trade war against its closest ally and trading partner. And there is much to consider about what comes next. But it's also worth reviewing how we got here.
On Nov. 5, Americans chose Donald Trump to be their next president. Twenty days later, Trump announced, via a post to his own social-media platform, that he would apply a 25 per cent tariff to all products imported into the United States from Canada and Mexico — a response, he claimed, to the fact that people and illegal drugs were entering the United States from those two countries.
The US and Canadian flags fly on the US side of the St. Clair River near the Bluewater Bridge border crossing between Sarnia, Ontario and Port Huron, Michigan on January 29, 2025. The Bank of Canada on January 29 cut its key lending rate 25 basis points to 3.0 percent, noting that US tariff threats are creating uncertainty for the economy.""The economy is expected to strengthen gradually and inflation to stay close to target (of two percent)," the central bank said. "However, if broad-based and significant tariffs were imposed, the resilience of Canada's economy would be tested."
Prime Minister Justin Trudeau speaks during a first ministers meeting in Ottawa, on Wednesday, Jan. 15, 2025. THE CANADIAN PRESS/Justin Tang
"It's just a plausible-sounding reason for a president to do what he wanted to do for other reasons — George W. Bush wanted a splendid little war, Donald Trump just wants to impose tariffs and assert dominance," Krugman wrote.
Why does Trump want to put tariffs on Canada?
It can't be said that Trump is responding to some great desire on the part of Americans to get tough on Canadian-made products. A Reuters/Ipsos poll in January found just 37 per cent of Americans support a new tax on Canadian goods. Abacus Data similarly found that just 28 per cent of Americans think a 25 per cent tariff is a "good idea."
The White House referred to the tariffs as "leverage" on Saturday. But it's unclear what more the United States wants. And whatever his stated concerns about fentanyl, Trump may more profoundly view tariffs as a way to raise revenue for a federal government that is already running a deficit of $1.8 trillion US, and as a method to force companies to manufacture products within the United States.
"We were at our richest from 1870 to 1913," Trump said on Friday. "That's when we were a tariff country."
Workers are seen at a vehicle assembly line in Alliston, Ont., in April 2024. Flavio Volpe, president of the Toronto-based Automotive Parts Manufacturers' Association, has warned tariffs levied by the U.S. will cause shares in U.S. car companies to drop.
Prime Minister Justin Trudeau addresses the media following the imposition of a raft of tariffs by U.S. President Donald Trump against Canada, Mexico and China, in Ottawa on Saturday. Public Safety Minister David McGuinty, left to right, Foreign Affairs Minister Mélanie Joly and Finance Minister Dominic LeBlanc look on. (Justin Tang/The Canadian Press - image credit)More
In response, Trudeau announced Canada will hit back against the U.S. with tariffs on $155 billion worth of American goods in the coming days.
Prime Minister Justin Trudeau announced late Saturday the federal government will hit back against the U.S. after President Donald Trump launched a trade war this weekend with punitive tariffs on all Canadian goods.
Trudeau said Canada won't stand for an attack from a country that was supposed to be an ally and friend.
Ottawa will immediately levy retaliatory tariffs on a whole host of American goods as payback for Trump's attempt to wreck the Canadian economy, Trudeau said.
To start, Canada will slap 25 per cent tariffs on $30 billion worth of American goods coming into Canada as of Tuesday. The tariffs will then be applied to another $125 billion worth of American imports in three weeks' time.
"We don't want to be here, we didn't ask for this, but we will not back down in standing up for Canadians," Trudeau said.:
The prime minister said American liquor like beer, wine and spirits, vegetables, clothing, shoes and perfume will be among the first items to face Canadian retaliatory tariffs. Canada will also put tariffs on American consumer products such as household appliances, furniture and sports equipment.
Trudeau said there is more non-tariff trade action coming to try to force Trump's hand and get him to call off the hostilities.
Those actions are still to be decided but could include measures like restrictions on the export of critical minerals and energy products to the U.S. and a move to block American companies from bidding on government contracts, he said.
Trudeau urged Canadians to rally around the flag and choose Canadian products wherever possible to support embattled businesses. He asked shoppers to check labels before buying anything at the grocery store.
"Find your own way to stand up for Canada. In this moment, we must pull together because we love this country," he said.
While Trump has threatened to raise tariffs even higher if Canada retaliates, Trudeau said he was unbowed.
"We're not looking to escalate, but we will stand up for Canada, Canadians and Canadian jobs. That's my job and that's exactly what we're doing," he said.
Trudeau said he's been trying to reach Trump since his inauguration two weeks ago but hasn't heard back.
He said he wants to relay to Trump that it's better to tackle challenges such as drugs and migrants together as partners rather than as combatants in a trade dispute.
"People are upset and hurt by what's gone on here," Trudeau said. "But I have faith."
Trump slaps 25% tariff on Canadian goods
Trump launched a trade war against Canada earlier Saturday by imposing a 25 per cent tariff on virtually all goods from this country — an unprecedented strike against a long-standing ally that has the potential to throw the economy into a tailspin.
Trump's long-threatened plan to inflict economic pain on Canada has materialized on the day he said it would, and it includes a 10 per cent tariff on Canadian energy products. Trump is also levying tariffs of 25 per cent on all Mexican goods and 10 per cent on goods from China.
These potentially devastating tariffs are slated to take effect on Tuesday and remain in place until Trump is satisfied Canada is doing enough to stop the flow of fentanyl into the U.S.
"The extraordinary threat posed by illegal aliens and drugs, including deadly fentanyl, constitutes a national emergency," a White House fact sheet on the tariffs reads.
"President Trump is taking bold action to hold Mexico, Canada and China accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country."
Trump wants to 'stem the tide of illicit drugs'
In the executive order officially imposing the tariffs, Trump writes Canada has played "a central role" in the U.S.'s fentanyl challenges, despite American government data that shows comparatively little of the drug has been seized at the northern border in recent years.
Trump said Canada has failed to "devote sufficient attention and resources or meaningfully co-ordinate" with the U.S. to "stem the tide of illicit drugs."
Police in Canada have been carrying out fentanyl busts across the country, including one of the largest in Canadian history, in British Columbia last November.
President Donald Trump speaks to reporters as he signs executive orders in the Oval Office of the White House, Friday, Jan. 31, 2025, in Washington.
. (Evan Vucci/The Associated Press)
There's a reason Trump is framing the expected tariffs as a response to an "emergency" drug and migrant crisis: It gives him the leeway to impose tariffs even though the new NAFTA is in place to prevent exactly these sorts of levies.
Experts have said trade action of this magnitude has the potential to shave billions of dollars off of Canada's gross domestic product and plunge the country into a painful recession requiring government stimulus to prop up the economy.
Canada must 'hit back and hit back hard,' Ford says
Ontario Progressive Conservative Leader Doug Ford, who currently leads the premiers as head of the Council of the Federation, said Canada has "no choice but to hit back and hit back hard."
Ford recently called a snap provincial election, saying he wanted a stronger mandate to deal with tariff issues.
"The coming days and weeks will be incredibly difficult," Ford said. "Trump's tariffs will devastate our economy. They'll put 450,000 jobs at risk across the province. Every sector and region will feel the impact."
Alberta Premier Danielle Smith, who has been reluctant to support aggressive trade action against the U.S. until now, said in a statement that Trump's "mutually destructive policy" demands a response.
She said she supports "the strategic use of Canadian import tariffs on U.S. goods that are more easily purchased from Canada and non-U.S. suppliers."
Nova Scotia Premier Tim Houston said he is taking action right away in response to what he called Trump's "remarkable" broadside.
Nova Scotia Premier Tim Houston, centre, speaks to Quebec Premier Francois Legault, right, beside Ontario Premier Doug Ford as Canada's premiers hold a press conference to close the Council of the Federation meetings in Halifax on Wednesday, July 17, 2024.
(Darren Calabrese/Canadian Press)
Houston said Nova Scotia will double highway tolls for U.S. commercial vehicles and direct the Nova Scotia Liquor Corporation to remove all U.S. liquor from its shelves as of Feb. 4.
Trump's move Saturday shows no country is safe from his push to dramatically reshape the U.S. economy, roll back globalization and torpedo free trade deals like the Canada-U.S.-Mexico Agreement, that he signed in his first term.
Some $800 billion worth of goods crossed the Canada-U.S. border in the first nine months of 2024 alone, according to Canadian government data.
Trump's tariffs could drive down the flow of those goods with major ramifications for businesses and workers on both sides of the 49th parallel given just how intertwined the two countries are after decades of liberalized trade.
Data breaks down what's driving trade deficit
Trump is delivering on a campaign promise to seek retribution from countries he claims are "ripping off" the U.S.
By doing so, he is ignoring data that indicates the Canada-U.S. trade deficit is largely driven by American demand for cheaper Canadian oil. When oil exports are excluded, the Americans actually have a trade surplus with Canada, according to Canadian government data.
WATCH | What's in White House fact sheet on tariffs against Canada, Mexico, China:
Trump has cited wildly inaccurate trade deficit figures in the past, claiming at different times it's anywhere from $100 billion to $200 billion. The U.S. government's own data suggests the trade in goods deficit with Canada was $55 billion US as of November 2024.
Trump has also said the tariffs are to punish Canada for being lax on drugs and migrants even as the U.S. government's figures show less than one per cent of fentanyl and illegal migrants are coming from this country.
WATCH | 'This is a very difficult day,' says Business Council of Canada president:
Figures from U.S. Customs and Border Protection (CBP) show the agency seized 19.5 kilograms of fentanyl at the northern border last year, compared to a whopping 9,570 kilograms at the southwestern one.
The president teased for weeks that if Canada did more to crack down on the border, the country might get a reprieve from his trade actions.
The Canadian government delivered a billion-dollar border plan, but it wasn't enough.
The trickle-down effects of tariffs
Starting next week, American companies will be forced to pay tariffs to the U.S. government on the Canadian goods they import.
Those added costs could make some Canadian goods less competitive compared to those made in the U.S. or coming from other countries.
If Canadian companies can't sell their products into the U.S. at the same volume, some of them may have to close down or scale back and lay off workers.
But some goods can't easily be replaced, and there are potential knock-on effects for the U.S. economy, such as higher prices for American consumers.
WATCH | N.L. premier says Canadian identity 'under attack' with Trump tariff threats:
Before Trump imposed his tariffs, the Canadian government said U.S. gas prices could jump some 75 cents US a gallon overnight if he went ahead with tariffs.
Some U.S. Midwest refineries are entirely reliant on heavy crude from Alberta, and the Americans don't produce nearly enough oil on their own to meet demand.
The cost of electricity could also get immediately more expensive because many U.S. states rely on power from energy-rich provinces like B.C., Ontario and Quebec to keep the lights on in millions of American households.
Canadian lumber, favoured by U.S. homebuilders, will also spike, driving up the cost of new homes at a time when home prices have never been higher in the U.S.
Poilievre wants Parliament recalled
Conservative Leader Pierre Poilievre condemned what he called Trump's "massive, unjust and unjustified tariffs."
He urged the Liberal government to recall Parliament — it's prorogued until late March as the Liberals choose a leader to replace Trudeau — and enact retaliatory measures, including dollar-for-dollar tariffs on U.S. goods, with all the money raised going to "help for affected workers and businesses."
As part of what he's calling his Canada First Plan, Poilievre also wants the government to implement a "massive" tax cut and pursue swift approvals for new pipelines, mines and liquefied natural gas (LNG) plants to help bolster the economy.
"We will protect our economy, defend our sovereignty, bring home production and paycheques, and never back down," he said.
CBC
Sun, February 2, 2025
U.S. President Donald Trump holds up a signed executive order in the Oval Office of the White House on Jan. 23. (Ben Curtis/The Associated Press - image credit)
Addressing both Canadians and Americans on Saturday night, at one of the most fraught moments in the history of relations between Canada and the United States, Justin Trudeau reminded listeners of John F. Kennedy's words when the late American president addressed Parliament in May 1961.
"Geography has made us neighbours. History has made us friends. Economics has made us partners. And necessity has made us allies," the prime minister said, quoting Kennedy.
Trudeau did not repeat the next sentence in Kennedy's remarks: "Those whom nature hath so joined together, let no man put asunder."
Perhaps that line would have seemed in this moment like a direct attack on the current American president. But Kennedy's sentiment may have been implied as Trudeau proceeded to recount all of the occasions on which Canadians and Americans have fought together and all of the moments in which Canadians have been there to assist their neighbour.
Canadian Prime Minister Justin Trudeau delivers remarks at a Canada-US relations meeting at the Ontario Investment and Trade Centre in Toronto, on Friday, Jan. 31, 2025.THE CANADIAN PRESS/Chris Young
Together, Trudeau said, Canada and the United States have built the most successful economic, military and security partnership the world has ever seen and a relationship that is the envy of the world.
"Unfortunately, the actions taken today by the White House split us apart instead of bringing us together," Trudeau said as he announced how Canada will hit back at U.S. tariffs.
The depth and duration of the split remains to be seen. In the short term, it could be very difficult — not least for those whose jobs and livelihoods are now threatened. And at an anxious moment for the country, Trudeau seemed intent on both pulling Canadians together and preparing them for a significant struggle: "There are many ways for you to do your part," he said.
But even if this rupture is somehow patched over relatively quickly, it's easy to imagine how this could leave the sort of lasting scars that change for the long-term the relationship between two nations that nature hath joined together.
How did we get here?
The United States has now commenced a trade war against its closest ally and trading partner. And there is much to consider about what comes next. But it's also worth reviewing how we got here.
On Nov. 5, Americans chose Donald Trump to be their next president. Twenty days later, Trump announced, via a post to his own social-media platform, that he would apply a 25 per cent tariff to all products imported into the United States from Canada and Mexico — a response, he claimed, to the fact that people and illegal drugs were entering the United States from those two countries.
The US and Canadian flags fly on the US side of the St. Clair River near the Bluewater Bridge border crossing between Sarnia, Ontario and Port Huron, Michigan on January 29, 2025. The Bank of Canada on January 29 cut its key lending rate 25 basis points to 3.0 percent, noting that US tariff threats are creating uncertainty for the economy.""The economy is expected to strengthen gradually and inflation to stay close to target (of two percent)," the central bank said. "However, if broad-based and significant tariffs were imposed, the resilience of Canada's economy would be tested."
(Photo by Geoff Robins / AFP) (Photo by GEOFF ROBINS/AFP via Getty Images)
At least in the case of Canada, this was an irrational justification. Seizures of fentanyl at America's northern border represented 0.08 per cent of all fentanyl seized by American officials in the last fiscal year. The number of people entering the United States through Canada has also been a fraction of the total number of people entering via Mexico.
Regardless, preventing unwanted people and things from entering the United States is first and foremost the responsibility of the United States. If the U.S. believes it is justified in levying tariffs in this case, then Canadian officials would presumably have grounds to levy tariffs in response to the flow of illegal firearms that enter this country through the United States.
Canadian officials were nonetheless obliged — both political and practically — to take Trump's stated concerns seriously. And so they did. New resources were marshalled and new commitments to cross-border co-operation were made. By the federal government's estimate, the total package of measures will cost $1.3 billion.
But either it wasn't enough or it simply didn't matter.
Paul Krugman, the Nobel-winning economist and commentator, suggested this week that the use of fentanyl to justify this trade war was akin to a previous American administration's claims of "weapons of mass destruction" as a pretext to launch an invasion of Iraq in 2003.
At least in the case of Canada, this was an irrational justification. Seizures of fentanyl at America's northern border represented 0.08 per cent of all fentanyl seized by American officials in the last fiscal year. The number of people entering the United States through Canada has also been a fraction of the total number of people entering via Mexico.
Regardless, preventing unwanted people and things from entering the United States is first and foremost the responsibility of the United States. If the U.S. believes it is justified in levying tariffs in this case, then Canadian officials would presumably have grounds to levy tariffs in response to the flow of illegal firearms that enter this country through the United States.
Canadian officials were nonetheless obliged — both political and practically — to take Trump's stated concerns seriously. And so they did. New resources were marshalled and new commitments to cross-border co-operation were made. By the federal government's estimate, the total package of measures will cost $1.3 billion.
But either it wasn't enough or it simply didn't matter.
Paul Krugman, the Nobel-winning economist and commentator, suggested this week that the use of fentanyl to justify this trade war was akin to a previous American administration's claims of "weapons of mass destruction" as a pretext to launch an invasion of Iraq in 2003.
Prime Minister Justin Trudeau speaks during a first ministers meeting in Ottawa, on Wednesday, Jan. 15, 2025. THE CANADIAN PRESS/Justin Tang
"It's just a plausible-sounding reason for a president to do what he wanted to do for other reasons — George W. Bush wanted a splendid little war, Donald Trump just wants to impose tariffs and assert dominance," Krugman wrote.
Why does Trump want to put tariffs on Canada?
It can't be said that Trump is responding to some great desire on the part of Americans to get tough on Canadian-made products. A Reuters/Ipsos poll in January found just 37 per cent of Americans support a new tax on Canadian goods. Abacus Data similarly found that just 28 per cent of Americans think a 25 per cent tariff is a "good idea."
The White House referred to the tariffs as "leverage" on Saturday. But it's unclear what more the United States wants. And whatever his stated concerns about fentanyl, Trump may more profoundly view tariffs as a way to raise revenue for a federal government that is already running a deficit of $1.8 trillion US, and as a method to force companies to manufacture products within the United States.
"We were at our richest from 1870 to 1913," Trump said on Friday. "That's when we were a tariff country."
Workers are seen at a vehicle assembly line in Alliston, Ont., in April 2024. Flavio Volpe, president of the Toronto-based Automotive Parts Manufacturers' Association, has warned tariffs levied by the U.S. will cause shares in U.S. car companies to drop.
(Nathan Denette/The Canadian Press)
At least as measured by GDP, it's hard to see how the United States was richer at the dawn of the 20th century. But returning to the world of 1913 would mean reversing nearly a century of increasing economic integration between Canada and the United States — integration that was formalized by a succession of free-trade deals, the most recent of which was negotiated, signed and celebrated by Trump himself just over six years ago.
At the very least, Trump has seemingly now sent the message to Canadian leaders — and leaders in many other countries — that America is no longer to be regarded as a reliable ally or trading partner. He seems to believe America's economic power exists to be wielded against others, both foes and friends, with no concern for either America's international relationships or the welfare of citizens in other countries.
What will this do to the Canadian psyche?
Trudeau said he trusts the American people and doesn't believe they wake up wanting to pick a fight with Canada. And perhaps the president's continued focus on fentanyl offers a way out. Perhaps Canadian officials can continue to implement measures related to the border and then Trump can claim victory and everyone can go back to their corners. At least until the next tariff is threatened.
But what of the Canadian political psyche? Canadians had largely overcome the fears of previous decades and grown comfortable with closer economic integration with the United States. Fears of American cultural influence had also receded. At least until now.
Fans at an Ottawa Senators game on Saturday night booed the American national anthem. In addition to the $155 billion in counter-tariffs announced by Trudeau on Saturday night, Nova Scotia announced that highway tolls would be increased on American trucks and American alcohol would be pulled off the province's store shelves. British Columbia announced that the province would no longer sell alcohol from "red states" — that is, American states that voted for Trump last November.
Trudeau spoke of preserving the relationship between Canada and the United States and "necessity" and "economics" may ultimately carry the day. But Trudeau also called on Canadians to "choose Canada" — in their day-to-day purchases and even in their choice of where to vacation.
If nothing else, Trump's aggression may be a shot in the arm for Canadian patriotism.
"Canada is home to bountiful resources, breathtaking beauty, and a proud people who've come from every corner of the globe to forge a nation with a unique identity worth embracing and celebrating," Trudeau said on Saturday night.
Trudeau finished his prepared remarks with "Vive le Canada," a trademark rallying cry of former prime minister Jean Chrétien.
Chrétien lived through some of the seminal moments in the making of modern Canada — the repatriation of the Constitution, the Quebec referendums of 1980 and 1995 — and his last great political act as prime minister was refusing to go along with the American invasion of Iraq.
For Canadians, going our own way may be newly back in fashion.
At least as measured by GDP, it's hard to see how the United States was richer at the dawn of the 20th century. But returning to the world of 1913 would mean reversing nearly a century of increasing economic integration between Canada and the United States — integration that was formalized by a succession of free-trade deals, the most recent of which was negotiated, signed and celebrated by Trump himself just over six years ago.
At the very least, Trump has seemingly now sent the message to Canadian leaders — and leaders in many other countries — that America is no longer to be regarded as a reliable ally or trading partner. He seems to believe America's economic power exists to be wielded against others, both foes and friends, with no concern for either America's international relationships or the welfare of citizens in other countries.
What will this do to the Canadian psyche?
Trudeau said he trusts the American people and doesn't believe they wake up wanting to pick a fight with Canada. And perhaps the president's continued focus on fentanyl offers a way out. Perhaps Canadian officials can continue to implement measures related to the border and then Trump can claim victory and everyone can go back to their corners. At least until the next tariff is threatened.
But what of the Canadian political psyche? Canadians had largely overcome the fears of previous decades and grown comfortable with closer economic integration with the United States. Fears of American cultural influence had also receded. At least until now.
Fans at an Ottawa Senators game on Saturday night booed the American national anthem. In addition to the $155 billion in counter-tariffs announced by Trudeau on Saturday night, Nova Scotia announced that highway tolls would be increased on American trucks and American alcohol would be pulled off the province's store shelves. British Columbia announced that the province would no longer sell alcohol from "red states" — that is, American states that voted for Trump last November.
Trudeau spoke of preserving the relationship between Canada and the United States and "necessity" and "economics" may ultimately carry the day. But Trudeau also called on Canadians to "choose Canada" — in their day-to-day purchases and even in their choice of where to vacation.
If nothing else, Trump's aggression may be a shot in the arm for Canadian patriotism.
"Canada is home to bountiful resources, breathtaking beauty, and a proud people who've come from every corner of the globe to forge a nation with a unique identity worth embracing and celebrating," Trudeau said on Saturday night.
Trudeau finished his prepared remarks with "Vive le Canada," a trademark rallying cry of former prime minister Jean Chrétien.
Chrétien lived through some of the seminal moments in the making of modern Canada — the repatriation of the Constitution, the Quebec referendums of 1980 and 1995 — and his last great political act as prime minister was refusing to go along with the American invasion of Iraq.
For Canadians, going our own way may be newly back in fashion.
Prime Minister Justin Trudeau addresses the media following the imposition of a raft of tariffs by U.S. President Donald Trump against Canada, Mexico and China, in Ottawa on Saturday. Public Safety Minister David McGuinty, left to right, Foreign Affairs Minister Mélanie Joly and Finance Minister Dominic LeBlanc look on. (Justin Tang/The Canadian Press - image credit)More
In response, Trudeau announced Canada will hit back against the U.S. with tariffs on $155 billion worth of American goods in the coming days.
Prime Minister Justin Trudeau announced late Saturday the federal government will hit back against the U.S. after President Donald Trump launched a trade war this weekend with punitive tariffs on all Canadian goods.
Trudeau said Canada won't stand for an attack from a country that was supposed to be an ally and friend.
Ottawa will immediately levy retaliatory tariffs on a whole host of American goods as payback for Trump's attempt to wreck the Canadian economy, Trudeau said.
To start, Canada will slap 25 per cent tariffs on $30 billion worth of American goods coming into Canada as of Tuesday. The tariffs will then be applied to another $125 billion worth of American imports in three weeks' time.
"We don't want to be here, we didn't ask for this, but we will not back down in standing up for Canadians," Trudeau said.:
The prime minister said American liquor like beer, wine and spirits, vegetables, clothing, shoes and perfume will be among the first items to face Canadian retaliatory tariffs. Canada will also put tariffs on American consumer products such as household appliances, furniture and sports equipment.
Trudeau said there is more non-tariff trade action coming to try to force Trump's hand and get him to call off the hostilities.
Those actions are still to be decided but could include measures like restrictions on the export of critical minerals and energy products to the U.S. and a move to block American companies from bidding on government contracts, he said.
Trudeau urged Canadians to rally around the flag and choose Canadian products wherever possible to support embattled businesses. He asked shoppers to check labels before buying anything at the grocery store.
"Find your own way to stand up for Canada. In this moment, we must pull together because we love this country," he said.
While Trump has threatened to raise tariffs even higher if Canada retaliates, Trudeau said he was unbowed.
"We're not looking to escalate, but we will stand up for Canada, Canadians and Canadian jobs. That's my job and that's exactly what we're doing," he said.
Trudeau said he's been trying to reach Trump since his inauguration two weeks ago but hasn't heard back.
He said he wants to relay to Trump that it's better to tackle challenges such as drugs and migrants together as partners rather than as combatants in a trade dispute.
"People are upset and hurt by what's gone on here," Trudeau said. "But I have faith."
Trump slaps 25% tariff on Canadian goods
Trump launched a trade war against Canada earlier Saturday by imposing a 25 per cent tariff on virtually all goods from this country — an unprecedented strike against a long-standing ally that has the potential to throw the economy into a tailspin.
Trump's long-threatened plan to inflict economic pain on Canada has materialized on the day he said it would, and it includes a 10 per cent tariff on Canadian energy products. Trump is also levying tariffs of 25 per cent on all Mexican goods and 10 per cent on goods from China.
These potentially devastating tariffs are slated to take effect on Tuesday and remain in place until Trump is satisfied Canada is doing enough to stop the flow of fentanyl into the U.S.
"The extraordinary threat posed by illegal aliens and drugs, including deadly fentanyl, constitutes a national emergency," a White House fact sheet on the tariffs reads.
"President Trump is taking bold action to hold Mexico, Canada and China accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country."
Trump wants to 'stem the tide of illicit drugs'
In the executive order officially imposing the tariffs, Trump writes Canada has played "a central role" in the U.S.'s fentanyl challenges, despite American government data that shows comparatively little of the drug has been seized at the northern border in recent years.
Trump said Canada has failed to "devote sufficient attention and resources or meaningfully co-ordinate" with the U.S. to "stem the tide of illicit drugs."
Police in Canada have been carrying out fentanyl busts across the country, including one of the largest in Canadian history, in British Columbia last November.
President Donald Trump speaks to reporters as he signs executive orders in the Oval Office of the White House, Friday, Jan. 31, 2025, in Washington.
. (Evan Vucci/The Associated Press)
There's a reason Trump is framing the expected tariffs as a response to an "emergency" drug and migrant crisis: It gives him the leeway to impose tariffs even though the new NAFTA is in place to prevent exactly these sorts of levies.
Experts have said trade action of this magnitude has the potential to shave billions of dollars off of Canada's gross domestic product and plunge the country into a painful recession requiring government stimulus to prop up the economy.
Canada must 'hit back and hit back hard,' Ford says
Ontario Progressive Conservative Leader Doug Ford, who currently leads the premiers as head of the Council of the Federation, said Canada has "no choice but to hit back and hit back hard."
Ford recently called a snap provincial election, saying he wanted a stronger mandate to deal with tariff issues.
"The coming days and weeks will be incredibly difficult," Ford said. "Trump's tariffs will devastate our economy. They'll put 450,000 jobs at risk across the province. Every sector and region will feel the impact."
Alberta Premier Danielle Smith, who has been reluctant to support aggressive trade action against the U.S. until now, said in a statement that Trump's "mutually destructive policy" demands a response.
She said she supports "the strategic use of Canadian import tariffs on U.S. goods that are more easily purchased from Canada and non-U.S. suppliers."
Nova Scotia Premier Tim Houston said he is taking action right away in response to what he called Trump's "remarkable" broadside.
Nova Scotia Premier Tim Houston, centre, speaks to Quebec Premier Francois Legault, right, beside Ontario Premier Doug Ford as Canada's premiers hold a press conference to close the Council of the Federation meetings in Halifax on Wednesday, July 17, 2024.
(Darren Calabrese/Canadian Press)
Houston said Nova Scotia will double highway tolls for U.S. commercial vehicles and direct the Nova Scotia Liquor Corporation to remove all U.S. liquor from its shelves as of Feb. 4.
Trump's move Saturday shows no country is safe from his push to dramatically reshape the U.S. economy, roll back globalization and torpedo free trade deals like the Canada-U.S.-Mexico Agreement, that he signed in his first term.
Some $800 billion worth of goods crossed the Canada-U.S. border in the first nine months of 2024 alone, according to Canadian government data.
Trump's tariffs could drive down the flow of those goods with major ramifications for businesses and workers on both sides of the 49th parallel given just how intertwined the two countries are after decades of liberalized trade.
Data breaks down what's driving trade deficit
Trump is delivering on a campaign promise to seek retribution from countries he claims are "ripping off" the U.S.
By doing so, he is ignoring data that indicates the Canada-U.S. trade deficit is largely driven by American demand for cheaper Canadian oil. When oil exports are excluded, the Americans actually have a trade surplus with Canada, according to Canadian government data.
WATCH | What's in White House fact sheet on tariffs against Canada, Mexico, China:
Trump has cited wildly inaccurate trade deficit figures in the past, claiming at different times it's anywhere from $100 billion to $200 billion. The U.S. government's own data suggests the trade in goods deficit with Canada was $55 billion US as of November 2024.
Trump has also said the tariffs are to punish Canada for being lax on drugs and migrants even as the U.S. government's figures show less than one per cent of fentanyl and illegal migrants are coming from this country.
WATCH | 'This is a very difficult day,' says Business Council of Canada president:
Figures from U.S. Customs and Border Protection (CBP) show the agency seized 19.5 kilograms of fentanyl at the northern border last year, compared to a whopping 9,570 kilograms at the southwestern one.
The president teased for weeks that if Canada did more to crack down on the border, the country might get a reprieve from his trade actions.
The Canadian government delivered a billion-dollar border plan, but it wasn't enough.
The trickle-down effects of tariffs
Starting next week, American companies will be forced to pay tariffs to the U.S. government on the Canadian goods they import.
Those added costs could make some Canadian goods less competitive compared to those made in the U.S. or coming from other countries.
If Canadian companies can't sell their products into the U.S. at the same volume, some of them may have to close down or scale back and lay off workers.
But some goods can't easily be replaced, and there are potential knock-on effects for the U.S. economy, such as higher prices for American consumers.
WATCH | N.L. premier says Canadian identity 'under attack' with Trump tariff threats:
Before Trump imposed his tariffs, the Canadian government said U.S. gas prices could jump some 75 cents US a gallon overnight if he went ahead with tariffs.
Some U.S. Midwest refineries are entirely reliant on heavy crude from Alberta, and the Americans don't produce nearly enough oil on their own to meet demand.
The cost of electricity could also get immediately more expensive because many U.S. states rely on power from energy-rich provinces like B.C., Ontario and Quebec to keep the lights on in millions of American households.
Canadian lumber, favoured by U.S. homebuilders, will also spike, driving up the cost of new homes at a time when home prices have never been higher in the U.S.
Poilievre wants Parliament recalled
Conservative Leader Pierre Poilievre condemned what he called Trump's "massive, unjust and unjustified tariffs."
He urged the Liberal government to recall Parliament — it's prorogued until late March as the Liberals choose a leader to replace Trudeau — and enact retaliatory measures, including dollar-for-dollar tariffs on U.S. goods, with all the money raised going to "help for affected workers and businesses."
As part of what he's calling his Canada First Plan, Poilievre also wants the government to implement a "massive" tax cut and pursue swift approvals for new pipelines, mines and liquefied natural gas (LNG) plants to help bolster the economy.
"We will protect our economy, defend our sovereignty, bring home production and paycheques, and never back down," he said.
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