Robert Libman: Tariff showdown holds the possibility of a major victory for Trudeau

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It often takes an external threat to prompt a group of people to circle the wagon and come together. In the past few days, we’ve seen Quebec Premier François Legault and his provincial counterparts uniting in common cause with the federal government of Justin Trudeau. 

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During the recent U.S. election campaign, Donald Trump suggested he would slap a 10 per cent tariff penalty on all imports entering the States. As campaign rhetoric, the patriotic affirmation resonates well: “Why buy from others, when we should be stimulating our economy and jobs by manufacturing those goods in America?”

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This week, however, the incoming president sent shock waves north of the border by making it real, announcing that on his first day in office he will impose 25 per cent tariffs on all Canadian and Mexican exports. There was a proviso, though: unless the two countries stop the flow of drugs and illegal migrants across their borders.

Legault and Trudeau have sustained a tense relationship over the past few years, prompted largely by issues of asylum seekers disproportionately entering Quebec, immigration targets and other matters that are federal responsibilities. Trump’s tariff threat, if implemented, could have a devastating impact on the economies of both Quebec and the rest of Canada and requires swift, concerted action to stop it from materializing. The U.S. is by far our biggest trade partner, with Statistics Canada estimating total trade between the two countries at close to $1 trillion.

Quebec itself exports $87.3 billion worth of products to the U.S., representing 74 per cent of all its exports, such as aluminum, electricity, aircraft parts and lumber. Legault is forcefully calling on Trudeau to resolve this existential threat to the economy, leveraging the opportunity to reiterate his push for Ottawa to tighten up border controls on illegal migrants, calling Trump’s concerns legitimate.

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It’s hard to know if Trump’s intention is really to go ahead with the tariffs. Is his threat more about sealing the border? Is it more about the economy and manufacturing jobs? Is 25 per cent just a negotiating number? Or is it just more patriotic chest-thumping without being sufficiently informed of the potential consequences on both sides of the border? These tariffs make little sense economically for either country, considering the ways in which our two economies and supply chains are intertwined. With almost $4 billion in daily cross-border trade, using tariffs to discourage affordable goods or oil from Canada could result in higher prices for U.S. companies and consumers, not to mention their gasoline prices. 

Trudeau cannot afford politically, nor can Canadians afford economically, for this ill-considered initiative to proceed. The ball is very much in Trudeau’s court now, and is a huge test of his leadership. 

Trudeau has already briefly discussed the issue with Trump, saying they talked about “laying out the facts.” Trump isn’t one for details and specifics, however, or being told what to do. Threats of retaliatory tariffs on U.S. imports probably won’t work either with him. 

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Trudeau will likely have to deploy his strongest attribute and muster up a flattery-laced charm offensive with the incoming president, also understanding that Trump would only drop this if there’s a self-congratulatory win in it for him. Trudeau therefore has no choice but to walk through the door Trump left open, making tariffs conditional on border control, even if Trump’s claims regarding the Canadian side may be somewhat exaggerated. 

If committing to Trump that Canada will do everything it can to tighten up its border staves off the tariffs, Trudeau can save the day and walk away with a major victory. At the same time, he would finally be relieving considerable tension with our premier. 

Robert Libman is an architect and planning consultant who has served as Equality Party leader and MNA, mayor of Côte-St-Luc and a member of the Montreal executive committee. He was a Conservative candidate in the 2015 federal election. 

x.com/robertlibman

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