Trump’s Canada Tariffs Are Not on Mission

W hen “liberation day” came, I was waiting to see where President Trump’s tariffs were all leading. On The Editors podcast, I pointed out that there are a few ways to set tariffs. You can set them low and broad and collect revenue from them. Or you can target countries or industries with higher tariffs in an effort to rebalance. Or you can set them very high and try to use the leverage and disruption that it creates as a negotiating tactic. It seemed clear to me at the time that these were not the final form of Trump’s tariffs. I offered that there was a possibility he would simply walk them all back to the status quo. After all, he had done something like that in his first term. His concluding negotiations with China didn’t substantially change our commercial relationship, and in fact ended with a request that China buy more soybeans from swing states during an election year. Or, it was possible, I thought, having tried to read the thinking of some of his advisers, that there was a plan to disrupt the trading order and then rebuild it — where U.S.-Canada-Mexico would form one rung, then European and East Asian allies another, directed at punishing and containing Chinese mercantilism and intellectual property theft — its joint ventures — and even its shipments of fentanyl.

It is turning out that Trump doesn’t seem to think he can significantly budge the Chinese. His faith in his negotiating ability and the importance of the U.S. market to many of our geopolitical allies has led to this week, where we are putting the thumbscrews to . . . Canada. Why? Because Quebec has laws mandating the French language?

Wasn’t this supposed to be a president elected to change our relationship with China? Why the hate for the Canucks?

Since the heavy-handed tactics on Canada began in February of last year, Canadian media has been ablaze about American tariffs. Foreign media is already genuinely more hostile to Trump’s presidency. And it was easy for them to gin up popular anger at the tariffs. Trump is correct that Canada benefits from sitting so close to the United States. We offer them a big market. Our military intimidates powers that might otherwise intrude on the Western Hemisphere. There is a kind of brotherly dysfunction to the relationship. A richer, more successful brother can generate many benefits for his siblings. But Canadians have their pride and resent being humiliated. America’s trade actions on Canada have generated a real popular reaction there, one that is driving Prime Minister Mark Carney into talking about an alliance of “middle powers” against the manipulative and bullying large global powers. This is probably nonsense, but popular reaction has to be taken into account in two of the world’s most secure democracies. This popular reaction against America threatens to cancel out any of the commercial benefits we wrung out of concessions in negotiations.

The United States and Canada do routinely have trade gripes. Maine lobstermen need to ship their lobsters to processing plants in New Brunswick, and occasionally Canadians have literally blocked the roads on which these are transported. This has salience in an election year for Susan Collins. Dairy and lumber are also chronic pain points — neither country wants the other putting their native industry into complete remission. But these conflicts have been managed quietly and carefully for decades. The escalation on lumber threatens to push home-building productivity down even further and raise the price for home-building precisely when American voters — including many independent men in the Trump coalition — are begging for relief.

Besides the unnecessary acrimony, the administration is using tariffs but relying heavily on Trump’s negotiating prowess and powers of improvisation rather than a focused industrial policy. Our peers and competitors — particularly China — don’t rely exclusively on tariffs to do the work for them. They deregulate in industries they want to capture. They use the state and their equivalents of the Department of Energy to build out a reliable grid and lower energy costs. When America is already pursuing a tighter immigration policy, which is making labor markets tighter at the bottom and raising wages, one of our chief competitive advantages is the lower cost of energy. We’re simply not maximizing this advantage the way we should when a Republican administration is in power. And the need is crucial at a time when private companies are investing heavily in energy-intensive data centers and when popular backlash to them is based on fears that their presence will raise energy bills or lead to blackouts.

Obviously, it’s easier to bully friends and neighbors than it is to stand up to powerful, canny rivals. But the premise of Making America Great Again was that we were in danger of surrendering global leadership to the Chinese and had to work ourselves out of the problem. This week, the project feels like it’s about humiliating the Québécois for product labeling and punishing the Canadian PM for pique.