Someone else’s election, but clearly Canada’s risk

Hey there, time traveller!
This article was published 07/11/2024 (670 days ago), so information in it may no longer be current.

It’s not our country, not our government and it wasn’t our vote, but today is the start of something many Canadians should be watching with concern.

Pierre Elliott Trudeau famously said that being neighbours with the United States was risky: “Living next to you is in some ways like sleeping with an elephant. No matter how friendly and even-tempered is the beast, if I can call it that, one is affected by every twitch and grunt.”

Now, it’s worse than just bedding with a genial elephant. The U.S. federal election has Canadians facing a very real risk of our economy being seriously damaged by someone else’s election result — the apparent win by Donald Trump in the U.S. presidential election.

The beast, as it were, may be neither friendly nor even-tempered.

This time, it’s like having our ship of state tied to a much larger vessel with ropes of trade, borders, tariffs, shared industry and interdependent financial markets, and facing the prospect of that larger ship rolling right over us, with no time left to cut the ropes that connect us to it.

Elon Musk, who is not running and would be elected by precisely no one, is already Trump’s choice to cut spending in the U.S. government. And so far, it appears he’s approaching the project like testing one of his SpaceX rockets: when one of the multi-million-dollar rockets crashes or explodes, Musk claims the launch as a success because of the information the company learns from the crash for the program as a whole.

Trump has suggested that as much as US$2 trillion could be cut from government programs, a magnitude of cuts that would change the U.S. entirely.

Critics have suggested the move would crash the entire economy, one that’s more than closely tied to our own: Musk’s answer is that yes, it could crash the economy, but that they could then rebuild it as a stronger version.

The problem is, the American economy isn’t a rich man’s in-house reach for Mars. It’s everyday life: crashing the economy steals jobs, pensions and the government services people depend on. Those who are well off will probably get richer — having the cash on hand to buy at fire-sale prices — but that profit will come on the backs of those whose lives collapse, along with any nest egg they might have for their future. A similar move in Argentina has led to a widespread economic collapse, with 57 per cent of the people in that country now living in poverty.

Donald Trump has argued Musk is so skilled at cost-cutting that no one will feel the cuts: that’s hard to imagine. The fact is that it’s not just paper spending: it’s US$2 trillion in paycheques and payments to companies large and small. It can only lead to massive layoffs in both the public and private sector.

But it’s not just the economy.

We have witnessed Donald Trump’s past governance of pique and pettiness, its fickle response to slights both real and imagined. Other Trump plans carry similar risks for Canada, including implementing huge tariffs — including immediate, across-the-board 10 per cent tariffs — on foreign nations importing goods into the U.S.

If the tariffs don’t work as Trump has outlined, it will drive the U.S. into a huge inflationary crisis, with the cost of tariffs landing on Americans. And even if the tariff plan does succeed the way Trump claims it will, remember that we are a foreign nation: we will potentially be hit even harder, with our biggest customer pricing us out of American markets.

Even Trump’s plan to deport millions of undocumented workers will hit us hard — what will the move do to the price of food, for example, given the number of undocumented workers in U.S. farming. And what will that do to the price of the food we import from the U.S.?

From almonds to broccoli to zucchini, we’ll feel the pinch.

This election result is extremely important to Canada — and Canadians can only helplessly watch the outcome.

Buckle up.