In case you wondered what happened to the trade war with our NOT 51st state, Dean Blundell has an update.
“If we don’t get a deal in 30 days, the tariffs go up. Not down.” – PM Mark Carney, June 19, 2025
Carney Puts Trump on Notice
Canada’s new Prime Minister isn’t mincing words anymore. In a blistering announcement today, Mark Carney gave the Trump administration 30 days to fix its trade mess—or face severe counter-tariffs on U.S. steel and aluminum.
The move comes after Donald Trump doubled down on his economically suicidal “Tariff Guy” identity by raising duties on Canadian steel and aluminum to 50%. Yes, 50%.
Carney’s response? No deal? No access. Canada will retaliate with equally punishing tariffs and is officially implementing a Buy Canadian policy for steel and aluminum used in all federal procurement. No more business as usual. If you're a U.S. steelmaker banking on Canadian government contracts? Better call Trump.
There’s more at the link. Carney and Trump agreed on a 30 day deadline to reach a ‘deal’. If it doesn’t happen, Canadian tariffs on U. S. steel and aluminum imports will double. Carney is taking steps to shore up Canada’s industry, and cut trade ties with America over these two metals.
As Blundell puts it: “The Carney Doctrine: Stand Up or Get Steamrolled.”
Trump’s tariff obsessions have done nothing except create chaos and raise tariffs across the board. As Paul Krugman has pointed out: (Sorry, paywall)
…The tariffs Donald Trump has imposed since taking office are the highest since 1934, when FDR passed the Reciprocal Trade Agreements Act. That U.S. legislation later became the basis for an international agreement, the 1947 General Agreement on Tariffs and Trade. The result was a system in which countries negotiated mutual tariff reductions, and the new, lower tariffs were “bound,” that is, countries couldn’t put their tariffs back up except under a limited set of circumstances.
In case you’re wondering, yes, that does mean that almost everything Trump has done on trade is a clear violation of past U.S. agreements. But that’s another topic.
Although one quite often sees news reports suggesting that Trump has backed down on tariffs, you can’t see that in the average tariff rate, which remains just slightly below what it was in the aftermath of the infamous Smoot-Hawley tariff of 1930:
emphasis added
One reason the Fed is holding steady on interest rates is because sooner or later Trump’s tariffs will start driving up inflation — and there’s no way to predict what Trump will do next.
Trump has so far been unable to come up with any of those fabulous trade deals he promised — although that hasn’t kept him from bragging about them in his increasingly delusional world.
Carney is setting an example for the rest of the world: no truce with would-be kings.
