The trade war between the U.S. and Canada has continued to escalate this week. As Canadian tariffs on nearly 700 U.S. products took effect Tuesday, President Donald Trump announced bans will go into effect later this month on Canadian motorcycles, dairy products and some alcohol.
The tariffs are affecting cross border trade and relations and are particularly acute for U.S. communities along the border. North Country Chamber of Commerce President and CEO Garry Douglas told North Country Bureau Chief Pat Bradley the intensified tit-for-tat is in neither country’s interest.
INTERVIEW TRANSCRIPT
Editor's note: This conversation has been lightly edited for clarity.
Douglas: Hopefully this is the end of it, and there won't be another round of retaliating.
It's kind of the the old adage that an eye-for-an-eye, and soon the whole world is blind.
I hope we're at that point where this is the final step in the hostile exchange, that we can then have the two countries focus on what the off-ramp is to get back to negotiations. Politics is clearly affecting that. There's no question about it. On the Canadian side, there hasn't been a more popular prime minister and government in Ottawa in modern history than the current one, so they feel every impetus to kind of be strong and tough with the U.S. in this negotiation. That's understandable. They're at over 70% approval, so they can hang on for a while, but only only for a while before they need to resolve this.
On the U.S. side, of course, the midterm elections are undoubtedly affecting this in the background. Some feeling that that's a reason why this needs to be resolved because tariffs are feeding into the perception of high costs and high inflation, which seems to be the centerpiece of the midterm elections.
At the same time, there seems to be a sense in some elements of the administration that this plays to the president's and his party's advantage.
We're being tough on Canada. We're going to get, for example, those auto jobs back in Ohio and Michigan. So that could kind of cause a sense of intransigence and delay. Nothing really is working for a quick resolution in the next couple of weeks, and hopefully negotiations will resume. Are we seeing direct impacts? We certainly will from from some of the targeted tariffs, new tariffs in both directions, higher tariffs on aluminum, now a Canadian tariff on American aluminum and steel. I'll point out an example, though, of a direct impact on the North Country and much of upstate New York. Northern New York obtains all of its cement from Canada, not 90%, not 95%, but 100 percent.
In the Greater Plattsburgh region, it all comes out of Quebec. It always has very affordably, very efficiently, we now have a 50% tariff on Canadian cement, and it's not readily exchangeable for sources of the South. In part because that would also add truckage transport costs, which would probably make it equitable to simply adding the tariff, so this is going to be another addition immediately on construction costs of all kinds, including for our goal of affordable housing.
Bradley: We see the quarry here in town, and a lot of cement trucks going in and out of there. So, how does this work, that the cement comes from Canada when we do have quarries here?
Douglas: The cement raw material comes out of Canada. It then is turned into concrete, and concrete is what is actually taken out in the cement trucks and poured. One is the the raw version; the other is the completed version.
Bradley: What other sectors are going to be directly impacted by the tariffs, particularly this latest dispute?
Douglas: Anything alcoholic — beers and alcohol are being affected in both directions for different reasons. And again, it's the things that are raw materials that are most concerned for a manufacturing area like ours. When you keep piling more and more costs and complications on something like aluminum. Just look around your house, everybody, and think about how many things in their home have some aluminum in them. It's astounding how many things do, and then realize that that's going to be a cost increase. We really have to stop referring to it as "tariffs" and refer to it as "taxes." This is one of the greatest tax increases ever foisted on the American people.
Bradley: What feedback have you been hearing from businesses and organizations in the region about this?
Douglas: Upwards of 93% of regional businesses oppose flying tariffs of any kind on Canada, and in fact want the USMCA treaty extended as soon as possible. Some of them are concerned about those direct costs increasing when you have manufacturers using components out of Canada as part of what they produce, for example. But as we've been saying from the very beginning, the greatest impact is in the uncertainty. Businesses cannot make major decisions in the face of uncertainty, and so uncertainty keeps things from happening. Many, many things, an increasing number of things from happening. Good things that otherwise would be happening, but are on pause. And we just put that dynamic on steroids in the last couple of weeks in both directions. And of course, we've continued to feel very sad about the growing impact on U.S.-Canada people-to-people relations. If we were making some progress, and it looked like we were starting to make some progress with the intentions of Canadian people in terms of traveling to the U.S. I have no doubt we've set that back completely and maybe made it worse than it was.
Bradley: What kind of data do you have, and what are you seeing about Canadian visitation? And is it diminishing simply because of the tariffs?
Douglas: It's not about the tariffs; about the rhetoric around the tariffs, about things like petulantly renaming Lake Ontario Lake America because the Premier of Ontario was particularly outspoken against America's tariff actions.
Imagine the reverse. Imagine if Canada announced tomorrow they're they're renaming Lake Champlain Lake Canada. Imagine if other binational bodies of water or mountains or whatever were unilaterally renamed as a reaction to a trade negotiation that would offend us.
It offends Canadians, and so it adds to the dynamic. We saw in 2025 about a 30-to-35% reduction in Canadian visitation across the border. We had hoped to see the beginnings, just the beginnings, of some reversal of that in 2026, and we were seeing that starting in April in the spring through July, we were seeing that it was still down compared to 2024, but up compared to 2025, about a 10% improvement. And we won't have August numbers, and certainly won't have September numbers for for some time yet. But we have every expectation that we're going to see a reversal of the increase, at least back to 2025 levels.
Bradley: You go up to Canada fairly frequently. You talk to Canadian officials a lot. What kind of comments are you hearing from them, and how is it affecting the relationship between the region and folks north of the border?
Douglas: Our relationship with the Canadian and Quebec governments has never been stronger because we're seen as an effective partner in terms of stating the facts, stating the impacts, and being on the side of resolution as opposed to warfare on the economic front.
In fact, I'm leaving for New York later today. I'll be in New York tomorrow with a number of Canadian officials that are visiting in relationship to 9/11. I'll be meeting with the new Canadian consul general in New York tomorrow afternoon at their invitation. And the business-to-business relationship has really not been affected. It hasn't been affected all through this. Business finds a way. You see that in the truck volumes at Champlain, where car volumes have been down. Truck volumes have remained fairly steady over the last two years, because we do need to remind ourselves that 90% of goods back-and-forth between Canada and the U.S. continue to move totally duty-free. It's categories of things that are being targeted, but once we get past this categorical warfare, this tit-for-tat, and get some resolution on those items, items like aluminum and steel, for example, we then still need this year to deal with the extension of USMCA and on what terms, and that could still affect the duty free status of another 90%. That's a concern. That's an uncertainty that again, is affecting cross-border investment.
