Ice and Fury: Inside the Canada-US trade war

While most fear the rift cleaving the Western world, the US’ self-alienation, let it be political, economic or ideological, should only come to build a better and stronger unity amongst other allied nations. MIA Student Ariane Coulombe takes a look at the developments and probable outcomes of the latest trade antics coming out of the White House

Ah, Hell hath no fury like a nation scorned.

What better way to overcome national party ideologies and affiliations than a good old trade war with your favourite (and in this particular case, only) neighbour. Similar to someone calling their only sibling their favourite sibling, Canada’s relationship to its dearest big brother seems to have taken a toll over the last few weeks.

The most recent G7 summit took place in Charlevoix, Canada, uniting the world’s seven most advanced economies to discuss important global issues. Of course, Donald Trump was in on the games but had to leave early for his flight to Singapore where he was set to meet North Korean leader Kim Jung Un (in what most definitely sounds like a House of Cards plotline).

Leaving early meant Trump could not attend the summit’s closing press conference where Justin Trudeau, Prime Minister of Canada, addressed US intentions of raising aluminium and steel tariffs against Canada and vowed to respond with similar tariff hikes. But Trump didn’t appreciate Trudeau’s intention to reciprocate and quickly announced on Twitter, while onboard Air Force One, that the US would not sign the G7 joint statement and followed up by calling the Canadian Prime Minister “meek and mild” as well as “dishonest and weak”.

You see, it isn’t easy to get Canadians riled up. But even despite the frigid nation’s warm heart, it seems like Trump’s ad hominem attacks against Trudeau have caused quite the outrage, even amongst the conservative opposition. Andrew Sheer, leader of the Conservative party called Trump’s “divisive rhetoric and personal attacks clearly unhelpful” (Unhelpful, which is Canadian for mean and nasty).

When White House trade advisor Peter Navarro told Fox News of there being a « special place in hell » for foreign leaders like Trudeau, Donald Tusk, President of the European Council, was quick to fire back on Twitter taking on Saint Peter’s role in assuring Justin’s safe spot at the political pearly gate (thanks Mr. Tusk, that was a close one). To think that before all you needed was strong diplomatic relationships. Now, it seems all you need is 280 characters and a bone to pick.

But this trade-turned-Twitter war has real consequences. In fact, the entire situation calls for a reevaluation of current western alliances with trust amongst nations at a seemingly historic low.

The 673.9-billion-dollar trade relationship between Canada and the US is one of the world’s most interdependent, but, arguably, also the most balanced. With the second largest trading relationship in the world after the US and China, by attempting to hurt Canada with unreasonable tariffs, the US does nothing but harm itself. Sure, Canada depends much more on the US than vice-versa, but hitting your allies with penalties on imports is nothing less than an assault on free trade.

If the US believes its allies won’t retaliate (which they will and already have) then its blissful ignorance is akin to shooting itself in the foot. One of many examples is the US’s threat of a 20% tariff increase on European cars. Such a move is not only detrimental to the European auto industry but to the global auto supply chain, and that includes American giants like General Motors and Ford. And while Trump believes Europe will soon back down with its own retaliatory tariffs, the waiting game seems to only have just begun. Even American companies understand the risk of such tariff hikes, with companies like Harley Davidson announcing plans to shift production from the U.S. to EU destinations to avoid the tariff burden.

This trade dispute comes during a time of great economic uncertainty within North America itself, with NAFTA in the works of being renegotiated in what feels like an uphill battle of interests. And alongside economic uncertainty lies political instability. Both Europe and Canada are dealing with an ally whose volatility is damaging to its foes, friends and to ultimately to itself. Retaliatory measures are one thing, but when faced with such unpredictability, what’s an ally to do?

While most fear the rift cleaving the Western world, the US’ self-alienation, let it be political, economic or ideological, should only come to build a better and stronger unity amongst other allied nations. While a protectionist attitude can make you seem tough politically, such measures appear counter-intuitive in an increasingly globalized world. The fight against isolationism requires states (or the rest-of-the-West if you will) both policy makers and citizens, not only to unite but to understand that for now, a US protectionist foreign policy is the new normal. To be appalled by every protectionist policy, every Tweet, every attack on the media or assault on free trade is useless. Envisaging a less US-centered world begins by understanding that the shift is real and for the time being, here to stay. For what could have once seemed impossible, now seems to be a next step.

But, despite tensions, tweets and trade wars, Canada and the US will always be neighbours. And while Canada is attempting to ratify free-trade agreements with Europe and Asia, its US dependency is not negligible and needs be further dealt with and evaluated cautiously.

And if all this wasn’t enough! Only recently it was announced that the 2026 World Cup will be hosted jointly by Canada, the US and Mexico. Almost like breaking up with your partner only to remember you bought non-refundable tickets for an all-inclusive cruise two months from now, let’s just hope they can work it out.

Ariane Coulombe is a 2019 Master of International Affairs candidate at the Hertie School of Governance. She holds a bachelor’s degree with Honours in International Affairs and Modern Languages from the University of Ottawa where she specialized in German language and culture. Her ongoing research has been on the factors behind political success and the rise of political extremism in Europe. Aside from international affairs and public policy, her interests include classical music, philosophy of language and writing.