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Trump Woke Up Canada - Finally!

                                            

It takes a lot to get Canadians angry, but when an economic war is declared on your country by your number one ally, feelings of betrayal can quickly turn hostile. Case in point the crowd in Ottawa booing the American national anthem at last Saturday’s hockey game. Expect more uncharacteristic actions of hostility by Canadians if this provocation continues or escalates further. Personally, I am not buying that Americans won’t care what Canadians think. Yes, they did vote in Trump, but they didn’t sign up for a trade war with their northern neighbour. 

Properly calculating the American public’s response is vitally important in determining how Canada should react. It should also be remembered that this is Trump’s trade war with us, it doesn’t have broad support even among his own party. Of course they will go along with Trump, as they always have, but if the pain of a trade war hurts too much for any future benefit, they’ll feel the winds of change from the electorate, even if the supposed populist Trump does not. 

Rather than capitulate, Canada's response will be to retaliate and let the Americans feel all the economic pain we can muster. While this does pale in comparison to the economic devastation the Americans can do to us, we do have one advantage. As anyone like myself, who has lived in both countries will tell you, there are some big differences between the two when it comes to lifestyle and expectations. Simply put, Canadians will put up with a lot more shit than Americans. The high taxes we pay for mediocre service and limited competition in the retail sector has made Canadians rather stoic. Look at the carbon tax if you want more proof. In the U.S., a tax on carbon was a political third rail and a concept that not even the democrats floated. When gas prices spiked post pandemic, Biden, fearing electoral wrath - released the States strategic reserves to lower prices. In Canada, Trudeau kept upping the tax year after before Canadians took notice. So when it comes to economic pain tolerance - Americans have nothing on Canada's resolve.

That is why it was little surprise that Trump blinked when made to understand the economic pain his trade war would cause Americans in the near term. It would be interesting to see how long Americans could last if the war actually happens.   

As for what is the method in Trump’s madness?

He does have an end goal that is certainly not in Canada’s best interest. He is not wrong in stating that America doesn’t need anything that Canada is selling - eventually. But currently, they do and it will take a bit of time for the States to stop taking our crude and to start refining more of their own shale oil and gas. It will be the same for lumber once Trump opens more land for logging. Getting those resources from Canada is currently cheaper (hence the tariff delay) but once more drilling and logging is done it will add supply and bring down market prices so Americans won’t notice the difference. He is also buying time to see if the Big 3 automakers can unwind themselves out of the parts supply integration they have with Canada and Mexico. In the meantime Trump can take a victory lap for getting Canada and Mexico to say "how high" when he said "jump".

The prospect of Canada losing its top trading partner will cause real economic pain for Canada no doubt. In Trump's mind, he probably thinks the 51st state offer is his way of being nice. But ultimately, Trump hopes that pressure will spur more concessions to gain access for what he really wants - access to the rare earth minerals of Canada’s north. 

Luckily for Canada, Trump's threats have finally awakened Canadians from a self induced coma. We are now ready to act and become more self reliant.

All we need now is a new government - and the clock is ticking.

By Gregory Cawsey - Human


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