Smoke

Just when you thought he was too busy bombing the poop out of Iran, trying to fudge the World Cup and fussing over his new gilded plane, Trump whacked us again.

Yesterday, sans warning, 47 imposed a 50% tariff on a range of maple exports, from wine to cheese to hockey sticks (how could he??). This happened three weeks after ten automatic renewal date of our free trade pact with the US expired and before talks have begun on revisions. So, it’s a classic Trumpian squeeze play. Make ‘em bleed, then get a deal. Bully stuff.

Most concerning is that the new levies – to take effect in a month – are on goods our trade deal (which remains in effect) exempted from tariffs. “This is a major break from the current tariff environment,” says bank economist Robert Kavcic, “where 90%-plus of Canadian exports not targeted by specific levies have continued to move tariff-free under cover of the exiting trade agreement.”

Indeed. Trump has now done to our CUSMA what he did to Iran’s MOU. His word, signature and assurance are meaningless. Imagine being America’s second-largest trading partner and having to deal with a guy devoid of ethics. That’s Mark Carney’s curse.

Why did Trump do this?

It’s part of his strategy to reimpose global tariffs the Supreme Court ruled were illegal. It’s also pique over provinces taking US booze off their retail shelves (except the traitorous government in Alberta), the fact Carney has been buzzing around the planet doing deals to lessen our dependence on America and, of course, the smoke. While country after country caved to Trump and accepted punitive US actions, only two did not. Canada and China. 举起手肘!, baby. In fact, the orange guy says Canada’s turning into a back door allowing a flow of Chinese goods into the States.

Well, here we are. The new taxes apply to about $20 billion in exports, or 5% of what we ship. If imposed they’ll hike the tariff rate on all maple stuff from 5% to about 7.5%.

It’s a bigger deal than it sounds.

“While that still sounds digestible in the aggregate, some specific businesses/industries would be hit extremely hard,” adds the economist. “And, if the shelter of USMCA is in fact broken, that would do serious further damage to business confidence. This, unfortunately, would come at a time when the Canadian economy is showing signs of breaking out of its slump and returning to decent growth into 2027.”

By the way, the TSX slumped 1% when it opened today, while US markets gained on a rebound in techy stocks. Meanwhile oil prices climbed another 3% as the US-Iran war widened and on news of the deaths of four American soldiers and injuries to a hundred more. That war is costing $1 billion a day, is spreading to the Red Sea and seems nowhere near a resolution.

So what does Trump do?

Right. Attack Canada. The best friend and ally America ever had, with an integrated economy, an endless and undefended border and generosity in supplying copious hockey players, rock legends, annoying reality TV personalities and movie stars to southern neighbours.

What will be the impact on us?

Unknown. As stated, this could be an empty threat. More TACO. Maybe Carney can find a way out, as he did with the bridge. Maybe the courts will declare the presidential decree illegal. Maybe Melanie Joly can be dispatched to hang around his desk in the Oval again, beguiling and outwitting him. Worth a shot.

If the tariffs materialize, it could wipe away up to 1% in Canadian GDP growth which has only recently started to rekindle. More importantly, the shattering of the CUSMA agreement is a negative for business investment, expansion and job growth in Canada. And tariffing a bunch of sectors just screws up the supply chain and ends up feeding inflation – which has also been improving.

Premiers like David Eby and Doug Ford – a socialist and a chainsaw – vow to fight the orange guy. Alberta is bowing down again like the Euroweenies. And Carney says this:

“This is the latest in a series of unilateral U.S. trade actions that began with the U.S. imposing a series of tariffs in direct violation of the Canada-United States-Mexico Agreement (CUSMA), the free trade agreement between Canada, the United States, and Mexico. Canada, as is its right, has merely matched those measures.

“Canada believes in the benefits of free and fair trade, as evidenced by our new government signing more than 20 new economic and security partnerships. This trade dispute has raised costs for families, particularly in the U.S. Canada stands ready to engage intensively to address outstanding issues with the U.S. to the mutual benefit of our citizens.”

Just send her.

About the picture: “Blog Dogs may find the attached picture amusing,” writes Dan. “Vancouver is dotted with dozens of little free “take-one, leave-one” libraries, but this is the first canine stick share dispensary I’ve seen. The photo was taken on a residential corner just off Commercial Drive.”

To be in touch or send a picture of your beast, email to ‘garth@garth.ca’.

Source: https://www.greaterfool.ca/2026/07/21/smoke-2/