Canadian Leaders Vow to Match U.S. Tariffs Dollar for Dollar

What Happened?

Canadian Prime Minister Justin Trudeau announced retaliatory tariffs on American goods after U.S. President Donald Trump signed an order imposing 25% tariffs on Canadian goods imported to the United States. 

Mr. Trudeau also expressed surprise at the new tariffs, saying ‘I don't think there are a lot of Americans who wake up in the morning saying, “Oh, damn Canada. Oh, we should really go after Canada.”’ 

Canada’s opposition leader Pierre Poilievre, widely expected to be the next Canadian Prime Minister, said that Canada should match the U.S. tariffs ‘dollar for dollar.’

Why it Matters

The Trump Administration imposed tariffs on Canada, along with Mexico and China, to punish those countries for failing in Mr. Trump’s view to stem the flow of illegal immigrants to the U.S. and the flow of illicit drugs such as fentanyl. 

While a good portion of illegal immigration and illicit drugs come from Mexico, less than one percent of fentanyl brought into the U.S. is estimated to originate from Canada. Less than one percent of illegals are believed to come from Canada.

Pierre Poilievre, Canada’s opposition leader, is expected to become the next Canadian Prime Minister in March. Mr. Poilievre has shown a strong lead in Canadian public opinion polls, and prior to the announcement of tariffs from the U.S. he had signaled support for President Trump. 

Following the announcement of tariffs on Canadian goods sold in the U.S., Mr. Poilievre reversed his stance and promised ‘not to back down’ from the Trump Administration and to retaliate with tariffs on U.S. goods.

The new tariffs have produced a noticeable effect on Canada’s population as well, as many Canadians have taken to booing the U.S. national anthem during sporting events. Whether the public show of disapproval and strong statements made by Canada’s leaders are just face saving measures or genuinely part of a broader effort to fight back against American tariffs remains to be seen. 

Mr. Trudeau, even as he announced new tariffs on American goods, struck a different tone when referring to the history of U.S. and Canadian relations. 

Said Mr. Trudeau ‘From the beaches of Normandy to the mountains of the Korean Peninsula, from the fields of Flanders to the streets of Kandahar, we have fought and died alongside you during your darkest hours.’

How it Affects You

The imposition of tariffs on goods from Mexico, Canada, and China along with the retaliatory tariffs from those countries on American goods means American consumers will likely face higher prices and increased costs in the near future. 

Mr. Trump has acknowledged as much, saying the short-term pain will be worth it in the long run. 

Whether the tariffs produce the desired effects of stemming the flow of illegal immigration and illicit drugs remains to be seen. But so far there are few indications any of the countries hit by new tariffs plan to change their policies.