It’s time for Canada to play hardball with Trump

Prime Minister Mark Carney should rethink his well-worn phrase: “There are times to hit back and times to talk and right now is the time to talk.” But now those talks are going nowhere fast — and U.S. President Donald Trump is threatening another 10 per cent tariff on Canadian products.

The Canadian government can’t just keep doing what it has done in the recent past to manage effectively the Canada-U.S. relationship under Trump. He simply can’t be believed or trusted.

Besides, we have no real experience in handling a White House that views Canada harshly, refers to us derogatorily as the “51st state” and is unwilling to recognize the benefits of a harmonious and highly integrated partnership. So the rules of the diplomatic game have fundamentally changed and it’s time to think outside the bilateral box.

Let’s be honest: Trump is essentially running an economic extortion racket. He believes that he holds all of the important cards. More importantly, he doesn’t fear Canada because he doesn’t think it has any leverage over the U.S.

Consequently, the Trump White House is playing us like a finely tuned fiddle. Why are we allowing ourselves to be humiliated by Trump? It’s time for Canada to call out the U.S. “blackmailer-in-chief.”

The immediate fear for Canada is that it is likely to lose the heretofore trade protection under the Canada-United States-Mexico Agreement at any time. When that happens, Trump’s economic nationalism and trade coercion impulses will be completely uninhibited. And that will leave us unprotected and vulnerable to any and every trade threat that Trump can think of.

With the end to trade rules, a dispute settlement mechanism and integrative supply chains, we must drastically change the Canada-U.S. calculus.

The reality is that Canada needs to play hardball with the U.S. — as China has done effectively by withholding critical mineral exports.

Look, it’s the only thing that Trump really understands. Otherwise, this country will be faced with almost four years of constant threats, extortion and, quite possibly, having to submit to Trump’s every whim. But do we really want Trump to own us when it comes to trade and policy-making autonomy for the rest of his term?

That’s why Canada has to get Trump’s attention by threatening to cut off something that the U.S. wants and needs.

I mean, there’s a reason why the tariffs on oil, gas, rare earths and potash are at 10 per cent. Simply put, we need to get Trump thinking about the damage that putting a surcharge on these products — or even an outright ban — will inflict on U.S. industry, the agricultural sector and American consumers.

So I’m suggesting Canada stop exporting to the U.S. that which they so desperately covet, and to use that to twist Trump’s arm. How is Trump going to explain to American voters, including those in rural areas, why they can’t get cheap Canadian oil, gas and potash?

Maybe that sounds like economic suicide to you. But it’s called taking off the gloves and showing some backbone, standing up for ourselves and sending a very potent message to official Washington. That is to say: If you come after us on any of our exports, we are going to make you pay dearly.

We also need to understand that trade diversification is a fantasy. And it’s not going to happen in the short term. It’s just something that politicians tell us so we won’t totally lose hope.

Indeed, the “Third Option” of the early 1970s has been dead for more than 50 years now and it was mostly a bust. The fact remains that the U.S. is always going to be our most important trade market for a host of reasons (e.g., think about the tyranny of geography and business compatibility).

Finally, a ban could provide us with some critically important bargaining chips with the U.S.

It would also put Ottawa in a stronger negotiating position if we have to cobble together some sort of bilateral trade deal with Trump’s Washington.

Of course, such a high-risk move at deterrence is not without potential costs. There are sure to be negative implications for federal-provincial relations, job and investment losses for both Alberta and Saskatchewan and the real possibility that the U.S. will switch to alternative suppliers.

But we need to stand up to the bully, to stop being America’s punching bag and to win back some respect for Canada and Canadians.

In other words, we need to get Trump to think twice about threatening us with additional tariffs on Canadian-produced films, pharmaceuticals, you name it.

I know this is obviously not an ideal strategy over the long term. I’m certain that skeptics and representatives of Canada’s business community will have some valid criticisms of their own. But they will need to come up with a better option, and one that gets Trump to perish any thought of coming for Canada in a post-CUSMA world.

Peter McKenna is professor of political science at the University of Prince Edward Island in Charlottetown.