Trump Appeasement Fails, So Trudeau Takes the Gloves Off
(Bloomberg) -- After more than a year of trying to make nice, Justin Trudeau finally looks fed up with Donald Trump.
That all changed Thursday when Canada, along with Mexico and the European Union, lost exemptions to the U.S. metal tariffs.
Trudeau tore into the Trump administration, if only by the standards of stereotypical Canadian politeness. He fired back with tariffs on U.S. exports of everything from whiskies to motorboats to orange juice. He said the legal basis of tariffs -- U.S. national security -- was an affront to Canadian soldiers who died fighting alongside Americans in numerous global battles.
“Let me be clear: These tariffs are totally unacceptable,” a visibly frustrated Trudeau told reporters in Ottawa, calling the measures inconceivable and deplorable. “This is not about the American people. We have to believe that at some point their common sense will prevail, but we see no sign of that in this action today."
It’s a tone change for the “sunny ways” Trudeau. Canada is a close U.S. military ally and the top U.S. export market, more than the U.K., Japan and Germany combined. It sells the U.S. more steel and aluminum than anyone else, in part because of deeply integrated auto and defense sectors. Trudeau cracked down on Chinese steel imports for Trump, and U.S. data show that it has a trade surplus with Canada. None of it mattered.
Underscoring his frustration, Trudeau offered a rare glimpse into high-level talks with Trump’s administration to update the North American Free Trade Agreement, which the president regularly threatens to tears up.
Trudeau said he and Trump were planning to meet this week because a Nafta deal was in reach.
“There was the broad lines of a decent win-win-win deal on the table that I thought required that final deal-making moment,” he said. Then Vice President Mike Pence called and said Trudeau could only see Trump if he agreed to a U.S. demand for a Nafta sunset clause. Trudeau refused and the meeting never happened.
Trump on Thursday night offered a fresh warning to Trudeau that any renegotiated trade agreement must be “a fair deal.”
“The United States has been taken advantage of for many decades on trade," the president said in a statement released by the White House. "Those days are over. Earlier today, this message was conveyed to Prime Minister Justin Trudeau of Canada: The United States will agree to a fair deal, or there will be no deal at all." Around the same time, Trump tweeted: “FAIR TRADE!”
Earlier in the day, Trudeau’s foreign minister, Chrystia Freeland, called the retaliatory tariffs “the strongest trade action Canada has taken in the post-war era.” The finance minister, Bill Morneau, said Treasury Secretary Steven Mnuchin was going to get an earful at the Group of Seven finance ministers’ meeting that began Thursday in Whistler, British Columbia. “I don’t want to kid you, we will need to talk about this first and foremost,” he said. Trudeau’s defense minister, a former soldier, also teed off: “I find it quite insulting, especially for somebody like myself who served alongside the U.S.,” Harjit Sajjan said.
Trudeau, a regular advocate of free trade and multilateralism, placed the blame squarely at Trump’s feet. “Today’s decision belongs entirely to the U.S. administration. That was their choice,” he said. “The Trump administration simply doesn’t understand its measures will hurt Americans,” he said.
“We will continue to make arguments based on logic and common sense and hope that eventually they will prevail against an administration that doesn’t always align itself around those principles.”
Buoying Trudeau’s tone change is near-unanimity in Canada about the tariffs. Opposition parties have largely supported Trudeau’s approach with Trump and on Nafta. The nation’s largest private-sector union, Unifor, applauded the retaliatory move. “Make no mistake -- this is a full-on trade war,” President Jerry Dias said.
Roland Paris, an academic and former Trudeau foreign policy adviser, said he declined a meeting with the U.S. embassy on principle to protest the “appalling” actions. Two cabinet stalwarts of Canada’s previous Conservative government, James Moore and Jason Kenney, tweeted support for the retaliatory tariffs. “When Canada is under attack, we unite. Country first,” Moore tweeted, calling the U.S. measures “mercantalist nonsense.”
Patience has worn thin. “We’ve all had just about enough of Donald Trump,” Ontario Premier Kathleen Wynne, a Trudeau ally, told reporters before the retaliatory tariffs were announced.
“The reality is that our federal government has moved heaven and earth. They’ve cajoled Trump, they have soothed his ego, they’ve played to his apparently inexhaustible vanity,” she said. “The time for talk is done. Donald Trump is a bully and the only way to deal with a bully is to stand up and push back and we have to do that.”
Trudeau now prepares to host Trump at the G-7 leaders summit in Charlevoix, Quebec, next week. Trudeau said Trump is scheduled to attend and that he expects “frank and serious conversations amongst world leaders.” In the meantime, the tariff war is on -- with another potential tariff, on cars, remaining a possibility. It too would be implemented under grounds that Canada undermines U.S. national security.
“The notion that we’re a national security threat is just -- I mean, pick your invective,” said Joseph Galimberti, president of the Canadian Steel Producers Association. “Questionable, in the least.”
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