Federal government to give potential response to threatened U.S. tariffs as Donald Trump ramps up attacks on Canada
The federal government signalled Wednesday that it took U.S. president-elect Donald Trump seriously when he spoke this week of using “economic force” to annex Canada, after previously downplaying as a joke his repeated taunts about making this country the “51st state.”
A senior government official, who spoke to the Star on condition of anonymity, said the latest and most extreme talk of erasing Canada’s sovereignty has galvanized the government. Ottawa is now pushing to soon release details of a potential response to Trump’s threat of a trade war, if he follows through on his plan to impose punishing 25-per-cent levies on all Canadian goods entering the United States, the official said.
Trump’s comments came after Prime Minister Justin Trudeau announced he will step down, and suspended Parliament for almost three months while his Liberal party stages a leadership race to replace him.
On Wednesday, as Liberal MPs gathered on Parliament Hill to discuss that leadership contest, several cabinet ministers stressed the need to take Trump’s belligerence seriously, and warned that the incoming American leader’s threatened tariffs would jeopardize thousands of Canadian jobs.
The Canadian Chamber of Commerce released an analysis in November with University of Calgary economist Trevor Tombe that predicted Trump’s tariffs could take a $78-billion chunk out of the Canadian economy — the equivalent of 2.6 per cent of national gross domestic product (GDP).
International Trade Minister Mary Ng said Wednesday it’s no longer a joke to hear Trump talk about making Canada part of the United States.
“We are taking it seriously, and we will respond seriously as well,” Ng said.
“We have to be concerned when tariffs and punishing tariffs are going to hurt the Canadian economy.”
Dominic LeBlanc, who took over as finance minister after Chrystia Freeland resignation from cabinet in December, ruled out a run for Trudeau’s job on Wednesday, in part to keep his focus on how to counter the danger of Trump’s tariffs. LeBlanc, who earlier said he thought Trump’s comment about Canada being the 51st state was a joke, told reporters Wednesday that that’s no longer the case.
“I find he has far surpassed the idea of a joke,” LeBlanc said in French. “It is becoming, frankly, completely counterproductive,” he added, suggesting it was a tactic to sow confusion.
LeBlanc said he was set to meet with top government officials Wednesday evening to discuss the tariff threats.
After Trump made the comments about annexing Canada at a news conference at his luxury club in Mar-a-Lago, Florida on Tuesday, Trudeau posted on social media that there is not “a snowball’s chance in hell” that Canada would become part of the U.S.
Opposition parties also pushed back against Trump, with Conservative Leader Pierre Poilievre stating online that “we are a great and independent country,” and promising to expand the military, improve border control and protect the Arctic from Russia and China if his party wins the next election. NDP Leader Jagmeet Singh called Trump a “bully” and said Canada should impose retaliatory tariffs on the U.S. if Trump follows through with his threats, which he said would harm the economies of both countries.
“You come for Canadians’ jobs, Americans will pay a price,” Singh wrote on social media.
On Wednesday, Premier Doug Ford — who has been appearing on American news channels to argue Trump’s threatened tariffs are misguided — proposed to better integrate energy systems in Canada and the U.S. to create a “Fortress Can-Am.” Ford has also said Canada should ink a trade deal with the U.S. that excludes Mexico, a partner in North American trade deals since the 1990s.
The federal government committed $1.3 billion to beef up border security after Trump named illegal immigration and drug smuggling as justifications for the tariffs he threatened to impose.
During Trump’s first term as president, from 2017 to 2021, he forced Canada and Mexico to renegotiate the North American Free Trade Agreement. In 2018, Trump slapped tariffs on Canadian steel and aluminum, arguing the action was necessary for U.S. national security. At the time, Trudeau called the tariffs “an affront to the long-standing security partnership between Canada and the United States” and responded with duties on more than $16 billion worth of American goods.
This time, as Trump prepares to return to the White House and impose his new tariffs on Jan. 20, the federal government has not ruled out any response as it prepares a new list of American goods to target if the incoming president follows through on his threats.
“We have to be extremely ready because the threat of tariffs is real,” said Foreign Affairs Minister Mélanie Joly, who is contemplating a run for the Liberal party leadership.
“We need to take (Trump) very seriously. I never take his threats lightly,” she added.
“At the same time, we can’t take the bait, and we’re extremely strong as a country,” she said. “We will never back down.”
For Roland Paris, a professor of international affairs at the University of Ottawa and a former foreign policy adviser to Trudeau, Trump’s latest comments about using economic force to annex Canada smacks of American imperialism. The incoming U.S. president also refused this week to rule out using military force to take over the Panama Canal and Greenland, the latter a territory of Denmark, an American and Canadian ally in the North Atlantic Treaty Organization.
“Trump’s language is really just an assertion of American dominance,” Paris said, describing how it “upends” decades of Canadian foreign policy assumptions, as North America became more integrated and through economic partnerships like the 1960s Auto Pact, and military co-operation such that seen in the North American Aerospace Defence Command.
While noting that it’s unclear whether Trump is sincere or merely blustering in an attempt to wrench trade concessions from Canada, Paris said the situation is nonetheless “unusual and disturbing.”
Aaron Ettinger, a professor who specializes in U.S. foreign policy at Carleton University, agreed that Trump’s posture echoes American “expansionism” in the 19th century. Some argued at the time that the U.S. was destined to control all of North America as part of a divinely inspired “manifest destiny.”
But while Ettinger dismissed the idea that Trump could use economic tools to take over Canada, he said his statements mark a break with decades of co-operation that have defined the Canada-U.S. relationship.
They also highlight how the U.S. could seriously harm the Canadian economy, given that it is by far Canada’s largest trading partner. According to Statistics Canada, 77 per cent of Canada’s exports went to the U.S. and 50 per cent of its imports came from there in 2023.
“There’s no escaping the economic pull of the United States,” Ettinger said.
”(Trump) can do us harm.”
This article was first reported by The Star
