I don’t think anyone knows what President Trump’s plans are, not even him sometimes. That being said what’s clear to me is, that he is fed up with the US thanklessly doing the lions share of policing the rest of the world and wants to begin withdrawing support. Because of the worldwide instability this will cause, he wants to fortify the US borders and make the US independent of relying on importing goods from other countries. By placing tariffs on imports, it will encourage start-up companies in the US to begin producing currently imported items themselves, not to mention pouring billions of dollars of revenue into the government. Telling Canada that by increasing border security, tariffs can be avoided when he has no plans to drop them, is just a trick to get a gullable Canada to pay more towards fortifying the US border for him. Hopefully, our politicians will figure it out soon.

Although I understand what he wants to accomplish, his methods are economically reckless. He should have started with lower tariffs, at around 10 percent, increasing them year over year. This would allow US startup companies time to begin producing tariffed items without the US consumer being forced to suddenly pay 25 percent more overnight. It would also allow time to work out the complex problems tariffs will bring. That being said, 25 percent is most likely Trump’s phasing in point and we should be preparing for 50+ percent by the end of his term.

Trump’s tariffs could turn out to be a double-edged sword for US citizens should the US go back to free trade. Profitable companies born out of tariffs during the Trump term could go under if they can’t match the prices of imported items without tariffs.

There is not a lot Canada can do to stop Trump and we should be preparing long term, to start losing the US as a trading partner, at least for the next 4 years. Forget about increasing border security! If anything, threatening to reduce it back to what it was and use the money to subsidize Canadian businesses affected would be a much better strattagy. That, along with the counter tariffs planned is all we can do. Outrage by US citizens from the pain he causes them is the only thing that will change his tariff stratagy.

Dave Lister

listerlogic.com