With two tariff failures, Trump has decided to randomly go after softwood lumber and dairy next in his efforts to bankrupt Canada.
Trump’s completely stupid trade war with Canada is continuing. This in an effort to wipe Canada off the face of the earth. In January, the moron in chief threatened 25% tariffs across the board on Canada and Mexico. This with a 10% tariff on China. These announcements of this happening was met with quite a bit of disbelief. For one, Trump has no actual reason to start a trade war like this on Canada. Second, such a tariff is going to cost American consumers quite severely given the integrated trade relationships with all three countries. Third, such a move is illegal under CUSMA/USMCA which the Trump administration themselves negotiated during his first disastrous administration. Fourth, all of this was under the obviously bogus claim that the Canada US border was somehow completely insecure and unable to stop fentanyl flowing across the border. Fifth, it was also under the completely delusional idea that somehow putting on tariffs was somehow going to enrich America broadly (spoiler: it’s not).
The Canadian mainstream media, for their part, fell for the line that this was about border security hook line and sinker. This despite the statistics that show that a fraction of a percentage of the fentanyl is coming from the Canadian side of the border. Arguably, more fentanyl is coming from the US into Canada rather than the other way around, but I digress. At any rate, the Canadian government decided to show that they are operating in good faith with the American’s (not that this should even need proving in the first damned place in this day and age) by beefing up border security, pouring more money and resources to tightening the border, and even setting up the position of a fentanyl czar to specifically look into how to ensure that fentanyl doesn’t flow between Canada and the US.
For me, I was always suspicious that the border security was always a red herring. Just look at what I wrote clear back in early January when I was discussing this story back then:
At the same time that was going on, Trump held a press conference doubling down on his tariff threat. In it, he said that he wanted to impose the 25% tariff unless Canada becomes the 51st state. The press conference did clarify one thing: the border security issue (which isn’t really an issue in the first place between Canada and the US in the grand scheme of things) was little more than a red herring. Dissolving Canada as a nation is a condition to have the tariffs removed.
While all of this seems pretty obvious now, back then, I was one of the only people out there point blank saying that these tariffs had nothing to do with border security between Canada and the US. Others were largely saying that, ‘oh no, this absolutely has everything to do with border security and if Canada tightens border security, then Trump will be satisfied and Canada can get an exception.’ This combined with comments saying that Trump is just being “bombastic” and that this is also probably just a “negotiating tactic”.
Well, as usual, this whole situation turned into yet another “Drew Wilson was right” moment as I notch yet another accurate prophetic comment. Honestly, these moments are becoming pretty routine at this point. So, when Trump moved forward with the tariffs all the way back in early February (which feels like a whole freaking life time ago at this point), all those comments by the Canadian mainstream media about this being a border security went kersplat. This when Trump was asked whether or not Canada could do anything at all or have any concessions to avoid these tariffs. Toxic Trump gave the unusually straight forward response of “no”.
Now, credit where credit is due here. In response to not only the tariffs moving ahead at the time, the Canadian mainstream media finally had a moment of clarity that these threats were actually serious. Reporters were finally realizing that this has nothing to do with border security and that Canada was in the midst of a trade war started by the Trump administration. What’s more, the Canadian government made the correct move in this situation and hit back with retaliatory tariffs. As realization set in that these threats were serious, the stock markets plummeted as well.
That last point is actually much more critical than it appears on the surface. Shortly after the stock markets crashed, Trump suddenly granted a 30 day reprieve on the tariffs. While it was difficult to draw that connection at first, that is probably what triggered the move to suddenly reverse course.
Crucially, the 30 day reprieve granted a time window for the Canadian government at all levels to start formulating better plans for when the tariffs were going to supposedly hit next. This while Trump was seemingly psyching himself up to go through with these tariffs as he convinced himself that the markets might tank a little, but it’s only temporary. What’s more, Trump also said that he was going to target Europe with tariffs as well. This as he announced an additional 25% tariff is going to be imposed on steel and aluminum. Later on, he said he would also issue so-called “retaliatory” tariffs on top of everything else.
One of the major disappointments I saw moving towards the March deadline for the 25% tariffs is the fact that the Canadian mainstream suddenly started getting collective amnesia about all of this. As the deadline approached, many outlets suggested, once again, that this really has to do with the border and doing what we can to secure the border. I have no idea why they convinced themselves that this whole situation revolved around border security at that point. Still, governments at both the Federal and Provincial levels were breaking with the media’s messaging and saying plainly that this is an existential threat. The Canadian mainstream media, for unknown reasons, reacted to these comments as if it was a surprising response and seemingly dismissed some of that as some odd comments made by officials (the government officials were right in that case). In fact, on the even of this latest attack, the Canadian government vowed to hit back.
At any rate, reality slapped some sense into the Canadian mainstream media as Trump moved forward with the tariffs. It was only then that they started moving away from the theory that this was a border security issue and realized that this was an existential threat. Better late than never, but glad they are finally on board with all of this.
Once again, the stock markets crashed. At one point, the DOW Jones lost 1,300 points over the course of two days. In response, Trump, no doubt glued to Fox News, saw the stock market crash, panicked, and pulled back again (partially this time) on the tariffs. Automotive tariffs got a 30 day reprieve and a chunk of goods and services also had the tariffs lifted for now. Crucially, not all tariffs got lifted and the Canadian government responded by saying that they aren’t reversing the tariffs on their side until the US government finally learns to behave like a civilized nation. That continues to be the messaging today which I think is a good move. Until the threat of tariffs and all tariffs are lifted, then the countermeasures stay in place. It showed that the Canadian government isn’t going to sit around and let Trump play games with the North American economy.
It is at this point patterns begin to emerge. Trump is watching the US stock markets to see if there is minimal disruption on the markets. Trump, at one point, denied that he is even watching the stock markets, so it’s a safe bet that he is gripping a ketchup bottle nervously while staring at the market numbers. This also because he later said that it’s all the “globalists” fault for the markets tanking as a result of the mess Trump created. From CNBC:
Major stock indexes dropped sharply this week, as rattled investors struggled to get a handle on President Donald Trump’s sweeping and shifting tariff policies.
But when asked in the Oval Office on Thursday whether he thought it was his tariffs that were scaring the markets, Trump pinned the blame elsewhere.
“Well, a lot of them are globalist countries and companies that won’t be doing as well,” Trump replied, “Because we’re taking back things that have been taken from us many years ago.”
Trump did not elaborate on what those things were.
Of course he didn’t elaborate on it. He’s making up obvious BS lies again. If anything, it’s kind of impressive that Trump didn’t blame the fictitious group, Antifa, for the markets collapsing in response to Trump’s actions.
At any rate, there is very likely a reason why Trump didn’t lift all tariffs on the recent pullback. Trump is trying to figure out which tariffs will sink the stock markets and which ones won’t. The 25% tariff didn’t work, so that got pulled back. The automotive tariffs didn’t work, so that’s getting pulled back. So, what’s the latest guess on what tariffs won’t sink the stock markets? Apparently, he’s third guess is going to be dairy and lumber. From Global News:
U.S. President Donald Trump said Friday he will soon bring in new tariffs on Canadian dairy and lumber that match the “tremendously high” duties he says Canada charges for shipping those products to the U.S.
The new tariffs could start as soon as Friday or early next week, Trump told reporters in the Oval Office.
“Canada has been ripping us off for years on tariffs for lumber and dairy products,” he said.
“They’ll be met with the exact same tariff unless they drop it. That’s what reciprocal means. And we may do it as early as today or we’ll wait until Monday or Tuesday. But that’s what we’re going to do, we’re going to charge the same thing. It’s not fair.”
So, what are some of the details. Well, the word is that the dairy is going to get hit with a roughly 250% tariff according to CNN:
“Canada has been ripping us off for years on lumber and on dairy products,” Trump said in an Oval Office address Friday, citing Canada’s roughly 250% tariff on US dairy exports to the country. Trump said America would match those tariffs dollar-for-dollar.
“We may do it as early as today, or we’ll wait until Monday or Tuesday,” Trump said. “We’re going to charge the same thing. It’s not fair. It never has been fair, and they’ve treated our farmers badly.”
My rough understanding is that it’s actually 241% tariff after a certain quota is met. So, after a certain amount being exported to the US, the tariff applies. I tried confirming that detail, but I haven’t been able to so far. It could, of course, change as well.
At any rate, the self-imposed deadline being imposed is Monday or Tuesday. At that point, the hope is that the US stock market crashes again and Trump goes through the cycle of panicking in response and pulling back again. It would be the third time that has happened if that does occur. Compounding things is the fact that steel and aluminum tariffs are supposedly going to kick in on the 12th, so a day or two after the softwood lumber and dairy tariffs. Again, like the softwood lumber and dairy tariffs, the hope is that the markets tank, Trump panics after seeing the results of his actions on Fox News, then proceeds to pull back again.
It’s such a weird thing to be rooting for a stock market crash when you are invested in it already, but hey, here we are. If the markets crash, that will probably be what convinces him to pull back. Various delegations have repeatedly tried to explain how the real world works to this administration to no avail. All the statistics and information available does nothing to convince him. Even industries with close ties to the American government are, at best, having a hard time convincing him that this is all a very bad idea. So, if it takes another stock market crash to convince him, well, it’ll take a stock market crash to convince him. What a stupid world we live in these days.
