COMMENTARY: Canada being unfairly cast as a trade villain
It’s unfortunately not surprising that a significant number of Americans feel their relationship with Canada is going to worsen further.
A new poll out this past week found that 46 per cent of Americans expect relationships with their traditional allies, such as Canada and the U.K. to get worse over the next year, with only 20 per cent anticipating any sort of improvement. Given the sorts of accusations being made about the United States’ northern neighbour, it’s difficult to see where or how that improvement would occur.
Canada has not always been a saint when it comes to embracing free and open trade, but neither have the Americans. At the moment, unfortunately, there are all sorts of falsehoods, confusion, and mixed messages about the actual state of the Canada-U.S. trade relationship.
And while the Americans may have some legitimate points they’re looking to resolve in NAFTA talks, the accusations and rhetoric about Canada’s supposed “unfairness” are reaching absurd levels. There’s a healthy dose of what one might call “fake news,” too.
Case in point was a tweet Thursday from Charlie Kirk, president of an influential pro-Trump organization called Turning Point USA. The tweet, which contained several blatant falsehoods about Canadian tariffs, was retweeted and liked several thousand times, and as of this writing was still up and still uncorrected.
Kirk claimed that Canada charges tariffs ranging from 25 to 48 per cent on items like cars, steel, aluminum, copper, and TVs. “We have never had free trade with Canada,” he claimed, adding that “Trump is levelling the playing field with Canada who has been ripping us off.”
Except we haven’t been. Canada’s tariff rates on such items for countries outside NAFTA are generally lower than the rates that the US applies (and far lower than the numbers Kirk cites). But thanks to NAFTA the tariff rate on all of those items is precisely zero (although we have now announce retaliatory tariffs in response to the steel and aluminum tariffs the U.S. is imposing on us). In other words, Trump isn’t levelling the playing field — NAFTA already did.
These false numbers have been shared elsewhere, too. And each time they’re shared, the replies and comments are typically variations of some sort of condemnation of Canada and/or praise of Trump for finally getting tough with that northern nuisance.
That’s part of what we’re fighting against; not just the erratic impulses of a protectionist president, but the false or misleading claims being trotted out to paint Canada as the bad guy and retroactively justify those impulses.
Trump himself offered yet another surreal example of this in a speech earlier in the week, where he declared that “Canada treats us horribly.” It’s the sort of claim his followers are likely to take a face value, but the anecdote he offered in support of this claim was more confusing than dramatic.
“People living in Canada are coming to the United States and smuggling things back into Canada because the tariffs are so massive,” Trump declared. “They buy shoes and then they wear them. They scuff them up. They make them sound old or look old.”
It’s hard to see how Canadians buying things in the U.S. constitutes an example of Canada treating the U.S. “horribly.” Presumably then, absent Canada’s alleged “massive” tariffs, these sinister smugglers would simply purchase shoes here in Canada, thus depriving U.S. retailers of sales.
Now, it’s true that Canadian cross-border shoppers don’t always declare their purchases, depending on how long they’ve been in the U.S. And in fact, the duty-free exemption has been an issue on the table at NAFTA talks, with the U.S. pushing Canada to harmonize the limit at $800.
But this has nothing to do with Canada’s “massive” tariffs. Again, thanks to NAFTA, the tariff rate on shoes produced within NAFTA countries is zero. As for shoes from other countries, the Canadian and American tariff rates are similar — for now, anyway. Canada’s trade deals with Europe and the Trans Pacific Partnership means those tariffs will be significantly lowered or eliminated altogether.
It’s yet another example of rhetoric that seems completely detached from the realities of the U.S.-Canada trading relationship or the issues being grinded out at the NAFTA negotiation table.
Reasonable people can disagree on whether or how NAFTA needs updating, but facts should still matter. Canada’s trade record is not flawless, but neither are we history’s greatest trade monster. In the heated political environment that is the U.S., Canada is being unfairly maligned and demonized.
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