The Calm Before The Storm
Tariffs are "paused" not eliminated
There is a sense of palpable relief in the air today. The Canadian economy isn’t ruined, the dollar given time to strengthen again. Ontario given a chance to get through this snap election campaign. The LCBO given a chance to perhaps sell their American stock, before being in a position where it needs to stop selling it.
I get the sense of relief, but not a sense of triumph, or happiness. We escaped the tariffs… for now because of a smart approach that targeted Republican voting states. The delay gives everyone time to regroup. Canada the chance to refine its approach, and apply more teeth in the form of industry financial aid. The US… gets the chance to figure out more unreasonable demands to ask of its allies? Maybe reinforce its own positions in the red states.
I first heard of the delay and immediately thought of CUSMA (Canada United States Mexico Agreement). It’s been a solid trade deal for all three parties. Over $2 billion/ day goes back and forth between Canada, and the United States (US). Mexico does over 850 million/ year in trade; a prosperous deal for all involved. President Trump has mused a lot about perhaps having a separate agreement with Mexico, and one with Canada. What does the fact he was able to make separate deals over the tariffs mean for the future of the trade agreement? If he’s to believed, Trump said the tariffs may still come, and are independent of CUSMA renegotiations.
The other troubling revelation is the fact that nobody appears to have presented the Canada’s border package, passed last month to President Trump. Or someone did, but he’s refusing to acknowledge it. Regardless, it’s definitely an indication he’s after something more than simply border security. Perhaps as others have said, even our sovereignty, which is a step too far. We may have our troubles at the moment, but I think all very aware of what we have to lose. We must be willing to fight for it.
We should use the thirty days to plan accordingly. Maybe… grudgingly we recall Parliament and look at what further measures we’d need. Perhaps looking building a pipeline or two through to the east coast. Look at striking down interprovincial trade barriers. Research Canadian companies in the grocery store, and buy Canadian, European, from the United Kingdom. There is something for everyone to do. But no matter what we shouldn’t let our guard down. The pause on tariffs can easily be ended at the whim of an erratic President, and we must be ready.