Tariff man’s back.
And in this case, that means it’s no longer safe to procrastinate about large-lot purchases of Canadian-made hockey sticks and cement, both of which will be half again as expensive this time next month on the off chance Donald Trump doesn’t cancel the levies.
Officially, Trump’s new Canada tariffs — which also cover the nation’s world-famous wines and exemplary home furnishings, pardon the sarcasm — are a response to what the administration’s calling “discrimination” against US-made cars, dairy products and alcohol. (Doug Ford’s US liquor ban, a protest measure against Trump’s farcical, but very real, threat to annex Canada, is the most high-profile example of such “discrimination.”)
“The United States, US businesses and workers, and US commerce suffer from Canada’s discriminatory, unequal and unreasonable tariff scheme,” Trump declared, in the course of unveiling the new 50% levies, imposed under Section 338 of the Tariff Act of 1930.
If you’ve never heard of that provision, don’t fret: Virtually nobody had until Monday evening. Written during the Great Depression, the law says The White House can tariff imports at rates up to 50% in instances where the president determines that countries are discriminating against US commerce specifically, note the emphasis.
Below, find the partial text of the statute, 19 US Code § 1338 – Discrimination by foreign countries:
The President when he finds that the public interest will be served shall by proclamation specify and declare new or additional duties as hereinafter provided upon articles wholly or in part the growth or product of, or imported in a vessel of, any foreign country whenever he shall find as a fact that such country —
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- Imposes, directly or indirectly, upon the disposition in or transportation in transit through or reexportation from such country of any article wholly or in part the growth or product of the United States any unreasonable charge, exaction, regulation, or limitation which is not equally enforced upon the like articles of every foreign country; or
- Discriminates in fact against the commerce of the United States, directly or indirectly, by law or administrative regulation or practice, by or in respect to any customs, tonnage, or port duty, fee, charge, exaction, classification, regulation, condition, restriction, or prohibition, in such manner as to place the commerce of the United States at a disadvantage compared with the commerce of any foreign country.
Whenever the President shall find as a fact that any foreign country imposes any unequal imposition or discrimination as aforesaid upon the commerce of the United States…he shall, when he finds that the public interest will be served thereby, by proclamation specify and declare such new or additional rate or rates of duty upon the articles wholly or in part the growth or product of any such industry as he shall determine will offset such benefits, not to exceed 50 per cent ad valorem or its equivalent, upon importation from any foreign country into the United States of such articles; and on and after thirty days after the date of any such proclamation such new or additional rate or rates of duty so specified and declared in such proclamation shall be levied, collected, and paid upon such articles.
Plainly, Trump has Jamieson Greer combing through the entirety of the American legal corpus for end-arounds that might permit a president to unilaterally tax trade.
“While the Administration continues to secure fair and reciprocal trade deals with our trading partners, Canada, unlike other partners and allies, continues to retaliate against the US,” Greer said, in a statement.
That’s really the crux of the issue. Canada is the only US ally to retaliate meaningfully and consistently against the tariffs. And Trump can’t stand it. China likewise struck back, but they’re harder to bully.
Remember: It’s easier, and often more productive, to bully your allies than your adversaries. Your enemies might tell you to go pound sound, particularly if they have leverage, as China does. Your friends, on the other hand, will generally try to accommodate you.
Mark Carney hasn’t been especially accommodating, where that means he refuses to bend the knee. Tensions flare at regular intervals. In October, for example, Trump lost his mind when Ontario ran a television ad featuring selectively-edited audio of Ronald Reagan explaining why tariffs are bad. The province eventually pulled the ad, but the damage was done.
The new tariffs, which Trump may well drop between now and the end of next month, exclude energy, fertilizer, minerals and don’t cover products already levied under Trump’s other “tariff schemes” (to employ the language of his July 20 “proclamation”).
The big story here isn’t expensive hockey sticks, it’s the fact that Trump didn’t offer exemptions for goods covered by the USMCA, his own trade deal. That accord, you’ll politely recall, was heralded by first-term Trump as a dramatic improvement over its predecessor, NAFTA. Second-term Trump wants to renegotiate it.
Trump’s envoys will be in Mexico this week for discussions about how to address his USMCA grievances. As Carney emphasized in response to Trump’s new levies, Canada has floated “a series of proposals to modernize” the USMCA, but the country’s engagement on the issue is hampered by Trump’s incessant badgering.
Last week, Trump suggested taxing Canada for sending its wildfire smoke to America. “The United States is being unnecessarily invaded by filthy, polluted and unhealthy air,” he seethed, accusing the Canadians of demonstrating “willful negligence” by “not properly maintaining” their forests.
(In 2018, during the deadliest and most destructive wildfire season on record in California, Trump famously recounted a conversation he had with then Finnish president Sauli Niinisto. “I was with the president of Finland, and he said: ‘We’re a forest nation.’ And they spent a lot of time on raking and cleaning and doing things, and they don’t have any problem.”)
It’s worth noting that the stopgap 10% levy Trump imposed on global trade after the Supreme Court struck down a broad swathe of his tariffs earlier this year expires on Friday. The administration’s rushing to figure ways to replace it.
Trump will doubtlessly be sued by someone for his latest attempt to make Smoot-Hawley great again, if for no other reason than this particular measure’s untested.
Carney, in a statement, called the threatened duties “the latest in a series of unilateral US trade actions.” “In response to these measures and threats to Canadian sovereignty, Canadians from coast to coast to coast have stood together,” he said.
As a reminder: Carney likely wouldn’t be prime minister right now were it not for Trump’s annexation threats. So, as with most of the problems bedeviling his second-term, Trump might (but of course won’t) look in the mirror when it comes to assigning blame.
So here we are; the educated, successful “elite”, having to endure the daily contemptible behavior of our own “dictator in chief”. Having just read this morning about Daniel Ortega, self declared president of Nicaragua ending elections, I couldn’t help but feel the incredible coincidence of outlaw behavior amongst 80 year old pretenders to democracy, becoming synchronized. The difference is, our proletariat (the under class of MAGAS) won’t rebel for overthrow of the government, a al the French Revolution, because they think they have achieved the “Rapture”. We’re in a terminal death spiral, led by House Speaker Johnson’s vision of the ultimate deliverable, complete subordination/domination by “1968” religious zealots who favor tithing.
It’s a crap shoot, near impossible, trying to satiate a lunatic, who changes his mind with his diaper – why try? Bending the knee often begets another beat down. What gets me is that Americans basically standby and watch their man wield an axe throughout the world, on a whim with no rational basis. You must be mortified.
PS. Canada does actually produce world class wines, especially ice wines. Try visiting the Okanagan, along Skaha Lake from Osoyoos to Summerland in British Columbia, and you might be surprised. I have toured wine country in Europe and California, and the Okanagan competes, as does the Niagara Region, but less so.
I regularly visit the Naramata Bench in the Okanagan. I was in the wine industry for decades and it’s one of the rare places with both a fascinating terroir and plentiful small family owned wineries to visit where you often meet the winemaker or owner, and it’s all in a beautiful and compact space.
Some history: Back in the days when the first NAFTA agreement was being negotiated, highly protected Canadian wineries, particularly in Ontario, were terrified of the consequences of opening up their markets to California wines. After that happened, much to everyone’s surprise, they started competing for market share and eventually were able to produce outstanding wines. The Okanagan in BC, which had for many years produced decent wines, soon developed some that were world class, while the Niagara region of Ontario, previously notorious for producing plonk, started producing many quite drinkable vintages.
I can’t speak knowledgeably about the quality of home furnishings from Quebec, although my impression is that they produce some really great products, but I can say, from experience, that forgoing California wines and buying only Canadian brands is not much of a sacrifice for Canadians.
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I’d be very pleased to here of another instance of the demise of Tariff Man.
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“Your friends, on the other hand, will generally try to accommodate you”.
Sure, but at a basic level, relationships are transactional.
While Trump is in Mexico, on behalf of San Diego, I hope he tells the Mexicans to stop dumping raw sewage into the Pacific Ocean- which ends up creating high levels of e-coli and other unhealthy substances in the waters off of San Diego. Last time I was there, I was advised to leave my shoes on while walking the beach and immediately shower afterwards.