The United States imposed 25 percent tariffs on Mexican and Canadian goods at midnight Tuesday. Canada immediately announced reciprocal tariffs. Northern border interests are watching the leaders of both countries as negotiations continue and the economic ramifications of the border taxes begin to be felt.
Following the implementation of the tariffs, Prime Minister Justin Trudeau said Canada would move forward to impose $155 billion in tariffs itself. The first phase of $30 billion begins immediately and the remainder is effective in 21 days if U.S. tariffs are not rescinded.
“Now it’s not in my habit to agree with the Wall Street Journal, but Donald, they point out that even though you’re a very smart guy, this is a very dumb thing to do,” remarked Trudeau.
President Trump has said the tariffs are being imposed due to national security and concerns over fentanyl trafficking.
Former northern New York Democratic Congressman and attorney Bill Owens notes that less than 1 percent of the drug enters the U.S. via Canada.
“Under the USMCA he really has to blame it on that because otherwise this would be an illegal act under the USMCA,” Owens explained.
The USMCA is the U.S-Mexico-Canada Agreement, which was last negotiated during the first Trump administration.
On Wednesday, Trump and Trudeau spoke by phone. The U.S. then announced a one-month pause for auto imports that meet duty-free status under the trade agreement.
SUNY Plattsburgh Center for the Study of Canada Director Christopher Kirkey notes that the two countries have moved away from an environment with clear trade relations.
“It was announced earlier today this one month pause perhaps in tariffs associated with the auto industry. Well, it’s just a pause and when asked why it was only one month Karoline Leavitt, the White House spokesperson, said oh it’s an opportunity for all these automakers to move back to the United States for manufacturing,” Kirkey noted. “Well, that isn’t going to happen in the course of a month. And even if there’s a promise to do so at some point you can’t turn around manufacturing assets like that quickly.”
North Country Chamber President Garry Douglas says segmenting tariffs by sector or industry is no solution.
“We’re on the front line of now a trade war between two highly integrated G-7 economies that we depend on for almost every sector of our economy in the North Country. We’re obviously very unhappy about this,” laments Douglas. “The only reasonable outcome is a full reversal and abandonment of applying tariffs on Canada. Now I don’t expect in the near term that’s going to happen and what we’re hearing is that there may be some exemptions for one or more sectors like auto making or there might even be some differential in terms of the 25 percent coming down to something else. We certainly wouldn’t be opposed but it would only make things less bad. It would not make things good.”
Speaking on WAMC’s Congressional Corner Wednesday, New York Congressman Pat Ryan, a Democrat from the 18th district, said the tariffs are nothing more than a tax.
“This is a tax on working class and middle class people,” contends Ryan. “The costs of these tariffs get passed on, not to the corporations that are, continue to make record breaking profits in our country, but to individuals in our community.”
Tariffs on steel and aluminum are set to go into effect on March 12th.
