CAN-USA Tariff Strife (split from various pol threads)

[PPCLI Guy]

Youre trolling or either being intentionally obtuse.

That is actually the motto of this site....

 

[QV]

I know 32.10 covers “what if Canada wants to negotiate a free trade deal,” but which bit of CUSMA says “Canada has to match US tariffs against other countries” - I’m always willing to be educated.

Yeah not sure. But as I understand it that is intended to protect the North American market from a place like China dumping material into Canada as a back door to the US tariff free.

Here is an AI take on what is publicaly available:

A neutral, data-driven assessment of the publicly available trade data reveals a classic "asymmetric interdependence" dilemma, where both nations face economic self-harm, but Canada carries a disproportionately higher share of the risk.

---

Neutral Assessment of the Trade Dispute
The current impasse is a collision between U.S. economic nationalism and Canadian economic sovereignty. Removing the political rhetoric reveals the following structural realities:

1. The Asymmetry of Trade Exposure

• Canada's Vulnerability: Approximately 75% to 80% of Canada's total exports go directly to the United States. Trade with the U.S. accounts for roughly 25% to 30% of Canada's entire Gross Domestic Product (GDP).
• The U.S. Insulation: In contrast, Canada buys roughly 15% to 18% of U.S. exports, which represents less than 2% of total U.S. GDP.
• The Reality: While a trade war disrupts specific U.S. border states and supply chains, it threatens Canada with a systemic macroeconomic shock, currency depreciation, and a potential technical recession.

2. Evaluating the Core Disagreements

• The U.S. Stance on Autos and Agriculture: The U.S. demands to lower Canadian dairy supply management barriers and increase U.S. auto parts content are standard protectionist maneuvers designed to repatriate manufacturing jobs. The U.S. argument that Canada benefits from lopsided access under previous frameworks holds weight in Washington because the U.S. runs a goods trade deficit with Canada.
• The Canadian Stance on Sovereignty: Canada’s rejection of the "veto clauses" (regarding third-party trade deals and domestic infrastructure investments) is legally and politically sound under international law. No sovereign nation can easily accept terms that outsource its foreign policy or investment screening to a foreign capital.

3. The Mutual Harm of Retaliation

• Supply Chain Fracturing: The automotive, aerospace, and steel sectors operate on "just-in-time" cross-border supply chains. Components cross the Canada-U.S. border multiple times before a final product is assembled.
• The Consequence: Canada's dollar-for-dollar retaliatory tariffs protect national pride but act as a tax on domestic manufacturers who rely on American inputs, ultimately driving up inflation for Canadian consumers.

---

Optimal Economic Course of Action for Canada
From a strictly non-partisan, economic perspective, Canada cannot afford a prolonged, hot trade war with its largest trading partner. The optimal strategy relies on structured de-escalation, targeted concessions, and long-term diversification.

Phase 1: Immediate Triage and Tactical De-escalation

• De-couple Sovereignty from Economics: Canada should hold a hard, unyielding line on structural sovereignty issues (e.g., U.S. vetoes over third-party trade deals or infrastructure). However, it should signal an immediate willingness to return to the table on purely commercial variables (e.g., tariff percentages, quota metrics).
• Offer "Win-Win" Concessions on Energy and Minerals: The U.S. administration is highly focused on national security and decoupling from China. Canada should leverage its vast reserves of critical minerals and energy assets. Offering the U.S. secure, preferred access to Canadian clean energy and battery supply chains can be traded to protect the Ontario/Quebec automotive sector.
• Reform, Don't Destroy, Supply Management: Canada's dairy supply management system is a constant friction point. Offering measured, incremental increases in U.S. market access—similar to concessions made in previous negotiations—can satisfy U.S. agricultural lobbies without completely dismantling the domestic sector.

Phase 2: Domestic Mitigation

• Targeted Industrial Subsidies: Rather than broad retaliatory tariffs that stoke inflation, the federal government should deploy direct financial relief and tax credits to protect vulnerable, highly exposed domestic sectors (like steel, aluminum, and forestry) to help them weather U.S. tariff pressures.
• Aero-Auto Corridor Alignment: Work directly with sub-national allies. Canadian policymakers and business leaders should bypass Washington to lobby U.S. Governors and border-state Senators (e.g., Michigan, Ohio, New York) whose local economies are deeply intertwined with Canadian trade, forcing domestic U.S. political pressure back onto the White House.

Phase 3: Long-Term Structural Hedging

• Execute True Market Diversification: Decades of "Third Option" trade rhetoric have failed to reduce Canada's reliance on the U.S. Canada must aggressively operationalize existing agreements like the CPTPP (Asia-Pacific) and CETA (Europe).
• Enhance Domestic Productivity: Canada's long-term economic vulnerability stems from a persistent productivity gap compared to the U.S. Capital tax reforms, increased R&D incentives, and reduced inter-provincial trade barriers are required to make Canadian businesses resilient enough to withstand future external shocks.

 

[lenaitch]

I didn't know we signed a free trade deal with China. Musta missed that.

Assuming the media reports are true (and we may never know what went on in the room), sovereignty also extends to selling of critical minerals to whoever we want, buying whatever military kit we want, and having a say in the management of our our two official languages in terms of requirements for packaging, instructions, manuals, etc.

 

[suffolkowner]

the critical minerals thing is a joke, very hard to take anything Trump says seriously especially considering the guy tariffed aluminum

 

[KevinB]

the critical minerals thing is a joke, very hard to take anything Trump says seriously especially considering the guy tariffed aluminum

Critical Minerals is definitely not a joke, there is a strong desire down here to tie them up -- or at least ensure that China cannot get a stake in them. I suspect that simply from a national security standpoint Canada would want something similar -- and frankly I see a way to work this into a beneficial way to help develop Canada’s North -

However WRT to Aluminum I suspect that someone on the Trade Team down here figured that may be a pain point in Canada without a real understanding of the needs down here.

Also virtually no one down here understands that even if a PM would love to sell French Language and culture down the river, it would never happen as it would bring down their government.

 

[ArmyRick]

No amount of spin makes this acceptable. There is no "on the other hand" here. Fuck them and anyone who tries to justify their actions in this completely unecessary trade war.

Noted. I have seen some of the comments you make to myself and a few others when we take a similar absolute position on political issues

 

[PPCLI Guy]

Noted. I have seen some of the comments you make to myself and a few others when we take a similar absolute position on political issues

Indeed I am. And you are right of course.

 

[ArmyRick]

I would ask those that want to rant and chant with their elbows up (stuck in their ears?) consider before you get all righteous and "to hell with Trump" attitude. Thats easy when a fight starts. When the fight gets going a few minutes, fatigue has set in and the pain is being felt, thats when you find out who the fighters are. And of course sometimes you simply lose.

I pointed earlier in this thread or the Can-USA one, some of the steps we better damn well start doing yesterday. Or forget fighting. We will get run over. Bad. Over $400 billion of our export dollars comes from the USA. Thats more than ALL our other export dollars combined. Some of you live in a fantasy land, thinking we are replacing it overnight. Or in ten years.

When many people flee the poverty here that is sure to hit (mostly flocking to the USA), people are hungry, jobless and homeless, and we become the new Mexico, maybe we better damn start thinking how far we go or intend to go.

I firmly believe that the Carney Liberals threw this trade deal side mostly for short term political gain. As time goes on, it does seem we were misled on a few of the reasons we rejected the deal.

Otherwise, whats the plan, kids? If ranting and chanting is it, we are royally fucked.

 

[Altair]

Yeah not sure. But as I understand it that is intended to protect the North American market from a place like China dumping material into Canada as a back door to the US tariff free.

Here is an AI take on what is publicaly available:

A neutral, data-driven assessment of the publicly available trade data reveals a classic "asymmetric interdependence" dilemma, where both nations face economic self-harm, but Canada carries a disproportionately higher share of the risk.

---

Neutral Assessment of the Trade Dispute
The current impasse is a collision between U.S. economic nationalism and Canadian economic sovereignty. Removing the political rhetoric reveals the following structural realities:

1. The Asymmetry of Trade Exposure

• Canada's Vulnerability: Approximately 75% to 80% of Canada's total exports go directly to the United States. Trade with the U.S. accounts for roughly 25% to 30% of Canada's entire Gross Domestic Product (GDP).
• The U.S. Insulation: In contrast, Canada buys roughly 15% to 18% of U.S. exports, which represents less than 2% of total U.S. GDP.
• The Reality: While a trade war disrupts specific U.S. border states and supply chains, it threatens Canada with a systemic macroeconomic shock, currency depreciation, and a potential technical recession.

2. Evaluating the Core Disagreements

• The U.S. Stance on Autos and Agriculture: The U.S. demands to lower Canadian dairy supply management barriers and increase U.S. auto parts content are standard protectionist maneuvers designed to repatriate manufacturing jobs. The U.S. argument that Canada benefits from lopsided access under previous frameworks holds weight in Washington because the U.S. runs a goods trade deficit with Canada.
• The Canadian Stance on Sovereignty: Canada’s rejection of the "veto clauses" (regarding third-party trade deals and domestic infrastructure investments) is legally and politically sound under international law. No sovereign nation can easily accept terms that outsource its foreign policy or investment screening to a foreign capital.

3. The Mutual Harm of Retaliation

• Supply Chain Fracturing: The automotive, aerospace, and steel sectors operate on "just-in-time" cross-border supply chains. Components cross the Canada-U.S. border multiple times before a final product is assembled.
• The Consequence: Canada's dollar-for-dollar retaliatory tariffs protect national pride but act as a tax on domestic manufacturers who rely on American inputs, ultimately driving up inflation for Canadian consumers.

---

Optimal Economic Course of Action for Canada
From a strictly non-partisan, economic perspective, Canada cannot afford a prolonged, hot trade war with its largest trading partner. The optimal strategy relies on structured de-escalation, targeted concessions, and long-term diversification.

Phase 1: Immediate Triage and Tactical De-escalation

• De-couple Sovereignty from Economics: Canada should hold a hard, unyielding line on structural sovereignty issues (e.g., U.S. vetoes over third-party trade deals or infrastructure). However, it should signal an immediate willingness to return to the table on purely commercial variables (e.g., tariff percentages, quota metrics).
• Offer "Win-Win" Concessions on Energy and Minerals: The U.S. administration is highly focused on national security and decoupling from China. Canada should leverage its vast reserves of critical minerals and energy assets. Offering the U.S. secure, preferred access to Canadian clean energy and battery supply chains can be traded to protect the Ontario/Quebec automotive sector.
• Reform, Don't Destroy, Supply Management: Canada's dairy supply management system is a constant friction point. Offering measured, incremental increases in U.S. market access—similar to concessions made in previous negotiations—can satisfy U.S. agricultural lobbies without completely dismantling the domestic sector.

Phase 2: Domestic Mitigation

• Targeted Industrial Subsidies: Rather than broad retaliatory tariffs that stoke inflation, the federal government should deploy direct financial relief and tax credits to protect vulnerable, highly exposed domestic sectors (like steel, aluminum, and forestry) to help them weather U.S. tariff pressures.
• Aero-Auto Corridor Alignment: Work directly with sub-national allies. Canadian policymakers and business leaders should bypass Washington to lobby U.S. Governors and border-state Senators (e.g., Michigan, Ohio, New York) whose local economies are deeply intertwined with Canadian trade, forcing domestic U.S. political pressure back onto the White House.

Phase 3: Long-Term Structural Hedging

• Execute True Market Diversification: Decades of "Third Option" trade rhetoric have failed to reduce Canada's reliance on the U.S. Canada must aggressively operationalize existing agreements like the CPTPP (Asia-Pacific) and CETA (Europe).
• Enhance Domestic Productivity: Canada's long-term economic vulnerability stems from a persistent productivity gap compared to the U.S. Capital tax reforms, increased R&D incentives, and reduced inter-provincial trade barriers are required to make Canadian businesses resilient enough to withstand future external shocks.

AI.

Of course.

 

[ArmyRick]

AI.

Of course.

What specific part of what he posted is inaccurate?

 

[Altair]

What specific part of what he posted is inaccurate?

I stopped reading once it said AI.

If someone isn't able to use critical thinking to explain their point and relies on outsource it to AI, I'm out.

What, am I to debate Google AI? Is Google AI in the room with us?

 

[ArmyRick]

I stopped reading once it said AI.

If someone isn't able to use critical thinking to explain their point and relies on outsource it to AI, I'm out.

What, am I to debate Google AI? Is Google AI in the room with us?

Actually it is. Its available on my computer which is in my work room right now.
This response, shows all the emotion and zero reason since you are 'too good" to take apart his arguments.

 

[Altair]

Actually it is. Its available on my computer which is in my work room right now.
This response, shows all the emotion and zero reason since you are 'too good" to take apart his arguments.

Fill your boots.

 

[suffolkowner]

Critical Minerals is definitely not a joke, there is a strong desire down here to tie them up -- or at least ensure that China cannot get a stake in them. I suspect that simply from a national security standpoint Canada would want something similar -- and frankly I see a way to work this into a beneficial way to help develop Canada’s North -

However WRT to Aluminum I suspect that someone on the Trade Team down here figured that may be a pain point in Canada without a real understanding of the needs down here.

Also virtually no one down here understands that even if a PM would love to sell French Language and culture down the river, it would never happen as it would bring down their government.

the point being that some arrangement on critical minerals is reached.....Trump term 3.....tariffs on said critical minerals applied

noted that aluminum is one of listed 34 critical minerals

 

[Czech_pivo]

the point being that some arrangement on critical minerals is reached.....Trump term 3.....tariffs on said critical minerals applied

noted that aluminum is one of listed 34 critical minerals

China has been selling the US, EU, Canada and just about everyone critical minerals. Yes, they put export limits and such on them from time to time, so why can’t we?
China wants to buy our nickel ore, fine then only 5% or 10% of our total yearly production can be sold to them - along with NO third party re-sell onwards to China. That resell condition would apply to the US as well, you can buy our nickel but you can’t turn around and resell it to China.

 

[Altair]

China has been selling the US, EU, Canada and just about everyone critical minerals. Yes, they put export limits and such on them from time to time, so why can’t we?
China wants to buy our nickel ore, fine then only 5% or 10% of our total yearly production can be sold to them - along with NO third party re-sell onwards to China. That resell condition would apply to the US as well, you can buy our nickel but you can’t turn around and resell it to China.

As long as we have export controls, not Washington.

First dibs for the USA is braindead. What if we want to sell to Europe?

 

[Czech_pivo]

As long as we have export controls, not Washington.

First dibs for the USA is braindead. What if we want to sell to Europe?

No ‘first dibs’ at all.
I’m moving a lot more over to PP’s idea of us creating a strategic stockpile of our critical minerals.
Doing that and giving our industry, the US and our other top customers ‘first right of refusal’ should be the approach.
The US taps its oil reserves to in reality sell to the rest of the world, in essence make money at times when the oil prices are high. They replenish it when oil prices fall.

 

[Altair]

No ‘first dibs’ at all.
I’m moving a lot more over to PP’s idea of us creating a strategic stockpile of our critical minerals.
Doing that and giving our industry, the US and our other top customers ‘first right of refusal’ should be the approach.
The US taps its oil reserves to in reality sell to the rest of the world, in essence make money at times when the oil prices are high. They replenish it when oil prices fall.

I don't think we have that much in terms of REE reserves.

 

[KevinB]

I don't think we have that much in terms of REE reserves.

You do.
It just isn’t being accessed - and the cost of access is pretty high currently.

 

[Altair]

You do.
It just isn’t being accessed - and the cost of access is pretty high currently.

Rare-Earth Reserves by Country 2026

Details on which countries have the largest reserves of rare-earth elements (sometimes called rare-earth metals or rare-earth oxides), which are a vital must-have ingredient in many modern technologies and electronic devices.

worldpopulationreview.com

Do we though?

China: 44M
Brazil: 21M
India: 6.9M
Australia: 5.7M
Russia: 3.8M
Vietnam: 3.5M
United States: 1.9M
Greenland: 1.5M
Tanzania: 890K
South Africa: 860K
Canada: 830K
Thailand: 4.5K