Canadian Prime Minister Justin Trudeau said Monday that Americans “are beginning to wake up to the real reality that tariffs on everything from Canada would make life a lot more expensive” and that he will retaliate if President Donald Trump imposes them.
Trump later replied that Canada was a state and Trudeau was its governor.
The Halifax Chamber of Commerce held an event where Trudeau said dealing with Trump would be “a little more challenging” than the last time. He said this because Trump’s team has a much clearer idea of what they want to do right away than they did after his first election win in 2016.
The next president-elect of the United States has said that he will put a 25% tax on all goods coming into the country from Canada and Mexico if they do not stop the flow of drugs and migrants.
Trump was elected on a promise to make life better and cheaper for Americans. Trudeau said, “I think people south of the border are starting to wake up to the fact that tariffs on everything from Canada would make life a lot more expensive.”
In an interview with NBC’s “Meet the Press” over the weekend, Trump said that he can not promise that the tariffs he plans to put on key U.S. trading partners will not make prices go up for American consumers.
Justin Trudeau said, “Let us not fool ourselves in any way; 25% tariffs on everything going to the US would be terrible for the Canadian economy.”
“However, it would also be very hard for Americans.” The United States gets a lot of its electricity and 65% of its crude oil from Canada. The United States buys almost all of Canada’s natural gas exports. They depend on us for aluminum and steel. They depend on us to bring in a lot of agricultural goods. It would cost more for all of those things.
In a late Monday night post on social media, Trump seemed to respond to Trudeau’s comments. He talked about Trudeau’s recent dinner at Mar-a-Lago, where Trump is said to have joked about Canada becoming the 51st state.
“It was great to have dinner with Governor Justin Trudeau of the Great State of Canada the other night.” We will have to see each other again soon so that we can keep talking in depth about Tariffs and Trade. The end result will be amazing for everyone. Trump wrote on Truth Social, “DJT.”
If Trump follows through on his threat to put 25% tariffs on all goods coming from Mexico and Canada, prices could go up. This will go against his campaign promise to help American families deal with inflation.
Economists say that businesses would have to pass on the higher costs to customers, which would mean that prices for food, clothes, cars, alcohol, and other goods would go up by a lot.
A trade group in Washington, D.C., called the Produce Distributors Association says that tariffs will make fresh fruit and vegetable prices go up and hurt U.S. farmers when other countries fight back.
Trudeau said, “Of course, we will respond to unfair tariffs, just like we did eight years ago.”
Trump’s new taxes on steel and aluminum hurt Canada’s economy, so Trudeau said his government is still thinking about “the right ways” to respond. He used the example of when Canada put billions of dollars worth of new duties on the U.S. in 2018 as a protest.
Many of the U.S. goods were picked because of how they would affect politics rather than the economy. For example, Canada only buys $3 million worth of yogurt from the U.S. every year, and most of it comes from a single plant in Wisconsin, which is where Paul Ryan grew up and is now the Speaker of the Republican House. A 10% duty was put on that item.
Trudeau said, “It was by putting tariffs on bourbon, Harley-Davidsons, playing cards, Heinz ketchup, cherries, and a number of other things that we were very careful because they had an effect on the president’s party and colleagues politically.”
Trudeau said that Trump means what he says, but that people also know that he is trying to bring “a bit of chaos” and uncertainty into democracies.
Trudeau said, “One of the most important things for us to do is chill out and not get scared.”
“Knowing these would be absolutely devastating means we have to take them seriously, but it also means we have to be smart and plan ahead. We can not go around making our opponent’s arguments for him; we have to make our own arguments in a strong and united way.”
Officials in Canada have said that putting their country in the same group as Mexico is unfair.
Last fiscal year, U.S. customs agents found 43 pounds of fentanyl at the border with Canada, but 21,100 pounds at the border with Mexico.
Most of the fentanyl that gets into the U.S.—where it kills about 70,000 people every year through overdoses—is made by drug cartels in Mexico using chemicals from Asia that are used as starting materials.
In terms of immigration, the U.S. Border Patrol said that between October 2023 and September 2024, they encountered 1.53 million people coming into the country illegally at the southwest border with Mexico. During that time, there were 23,721 encounters at the Canadian border.
Trump has also said that the US “subsidizes Canada to the tune of over $100 billion a year.”
The AP talked to Kirsten Hillman, Canada’s ambassador to Washington, about the U.S. trade deficit. Last year, the U.S. had a $75 billion trade deficit with Canada. However, it was pointed out that a third of what Canada sells to the U.S. is energy, and prices have been high.
About 60% of the oil and electricity that the United States imports come from Canada.
The U.S. gets most of its steel, aluminum, and uranium from Canada. Canada also has 34 important minerals and metals that the Pentagon wants and is investing in for national security.
It is worth about US$2.7 billion ($3.6 billion) worth of goods and services cross the border every day. Thirty-six U.S. states send the most goods to Canada.