Trump versus Carney: Redux

Trump versus Carney: Redux

The president seemed to be taken by surprise that Canada is acting like an independent country rather than the 51^st state. Is he really surprised that his tariffs have driven the Canadians to cozy up to the Chinese rather than bend to his will? Canada and China resolved a trade dispute and pledged more economic cooperation, causing the president to go bonkers.  Trump said “Carney thinks he is going to make Canada a ‘Drop Off Port’ for China to send goods and products into the United States, he is sorely mistaken. China will eat Canada alive, completely devour it, including the destruction of their businesses, social fabric, and general way of life.” He then threatened to impose a 100 percent tariff on all Canadian goods and services if Canada secures a trade deal with China. He has also threatened to ground all Canadian made jets over a dispute with Gulfstream whose jets are manufactured in Savannah, Georgia.

Canada also declined to join Trump’s so-called “Board of Peace” – saving the Canadians the $1 billion buy in – the president then rescinded the invitation writing “Dear Prime Minister Carney,” Trump wrote on his Truth Social platform late Thursday. “Please let this Letter serve to represent that the Board of Peace is withdrawing it’s invitation to you regarding Canada’s joining, what will be, the most prestigious Board of Leaders ever assembled, at any time.””

I wonder if Trump will rescind the tariffs on the countries that come bearing him the gift of $1 billion? 

Canada’s prime minister Carney had delivered a speech at the World Economic Forum in Davos, Switzerland urging smaller powers to unite against economic coercion from the world’s great powers. Carney the said that China was now a more reliable trading partner than the US. Again the president was furious saying “Canada lives because of the United States” and “Remember that Mark, the next time you make your statements.” 

Apparently the president and his team did not like Carney’s use of the term “economic coercion.” Commerce Secretary Howard Lutnick accused Carney of “an arrogant kind of thought,” and said that Carney was whining and complaining. Lutnick, ever the deep thinker, intimated that the US might even end the U.S.-Mexico-Canada free-trade pact. Huh? Wouldn’t a 100 percent tariff on all Canadian goods and services end that agreement? 

Treasury Secretary Bessent who has emerged as the president’s major interpreter called Carney’s speech “value-signaling.”  Carney realizes that China cannot replace the US as Canada’s major trading partner and later said that Canada had no intention of proceeding with a trade deal with China or “any other nonmarket economy.” So it might seem that Carney was all bluster and folded in the face of Trump’s threat of 100 percent tariffs. However, the EU and India have reached a free trade agreement so watch for Carney to pivot in that direction also.

Bessent also said that the president’s attempt to seize Greenland had nothing to do with his not receiving the Nobel Peace Prize despite Trump’s letter to Norway’s prime minister. He said that Trump’s threat to increase the tariffs on the NATO allies supporting Greenland was to avoid a future national emergency saying “It is a strategic decision by the president. This is a geopolitical decision, and he is able to use the economic might of the U.S. to avoid a hot war.” Go figure out that one. When the president said that he had reached an agreement on Greenland (we have not seen the details) and had withdrawn the tariff threat, Bessent said that was the president’s objective all along and that the president didn’t really back down as all the media had reported. Sure. Obviously, Bessent is trying to couch the tariff use as a national emergency but the threat to Canada hurts Trump’s argument that his tariffs come under the International Emergency Economic Powers Act.

But speaking of Canada, Alberta may vote on independence from Canada – much like Quebec once did. Alberta is resource oil rich and conservative, unlike the Canadian government. It has been at odds with the government about the utilization of its resources and the building of pipelines. A delegation from Alberta actually recently met with US officials. What was discussed? Perhaps Alberta as the 51^st state? Well Carney has told the US to not meddle in Canadian business and to stay out of aiding Alberta’s independence movement saying “We expect the U.S. administration to respect Canadian sovereignty,” 

Where does spat end? Is there any doubt that the president is using the US’s economic might to force Canada to do his bidding? Is there any doubt that most Canadians want to remain Canadians? Will it take a Supreme Court ruling on tariffs to bring back our trading relationships – the American distilling industry certainly hopes so.

I hope so too.