Canada held elections recently. As many people will undoubtedly remember, Trudeau’s actions caused a loss of confidence in his ability to lead the country. This led to the need for the recent elections. Hovering over this election were PDJT’s comments about turning Canada into the 51st state of the US.
Liberal and globalist Mark Carney’s party won the most seats and will form a new government. They will need the help of another party to do so since they did not win a majority of the seats. As it turns out, “conservative” candidate Pierre Poilievre not only did gain enough seats to challenge the government, he also lost his own seat in a stunning upset. Apparently, the more people got to know him, the more people who got turned off from him.
Sundance over at CTH has some interesting insights into the dynamics of what may happen now with US/Canada relations.
Sundance:
During the 2016 election President Trump repeatedly said he wanted to renegotiate NAFTA, the North American Free Trade Agreement. Both Canada and Mexico were reluctant to open the trade agreement to revision, but ultimately President Trump had the authority and support from an election victory to do exactly that.
In order to understand the issue, you must remember President Trump, Commerce Secretary Wilbur Ross and U.S. Trade Representative Robert Lighthizer each agreed the NAFTA agreement was fraught with problems and was best addressed by scrapping it and creating two separate bilateral trade agreements. One between the USA and Mexico, and one between the USA and Canada.
Canada (Trudeau) was strongly opposed to any renegotiation of NAFTA. Canada had exploited the NAFTA loophole where goods assembled in Canada could enter the US without tariffs. Much goods from China entered our country this way. Canada basically de-industrialized their economy and merely provided an assembly service for other countries particularly China.
Trump went ahead with negotiations with Mexico. When the US neared the end of their negotiations with Mexico, the US Chamber of Commerce (USCoC) told Trudeau that his position was untenable and Canada was in danger of being shut out from any participation. Let’s be reminded that the US CoC does not represent the American people. They represent large corporate interests.
Sundance:
Realizing what was about to happen, Prime Minister Trudeau and Chrystia Freeland quickly changed approach and began to request discussions and meetings with USTR Robert Lighthizer. Keep in mind more than 80 to 90% of the agreement was already done by the U.S. and Mexico teams. Both President Andres Manuel Lopez Obrador and President Trump were now openly talking about when it would be finalized and signed.
Nancy Pelosi stepped in to help Canada get back into the agreement by leveraging her Democrats. Trump agreed to let Canada engage, and Lighthizer agreed to hold discussions with Chrystia Freeland on a tri-lateral trade agreement that ultimately became the USMCA.
In the end a trilateral agreement was signed. That was on 11/30/2018 and went into effect on 7/1/2020. There is a clause that permits a review of the agreement after 5 years. That would be this year. Renegotiation would follow. Please be reminded that Trump would prefer two bilateral agreements because they are easier to focus on the subjects important to both countries.
Following the 2024 presidential election, Prime Minister Justin Trudeau traveled to Mar-a-Lago and said if President Trump was to make the Canadian government face reciprocal tariffs, open the USMCA trade agreements to force reciprocity, and/or balance economic relations on non-tariff issues, then Canada would collapse upon itself economically and cease to exist.
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To wit, President Trump then said, if Canada cannot survive in a balanced rules environment, including putting together their own military and defenses (which it cannot), then Canada should become the 51st U.S state.
Is Trump trolling Canada on this? I suppose it depends on how one defines trolling. It should be clear by now that this 51st state discussion is designed to fire up the liberals in Canada against the US. Mark Carney, the prime minister, stated that the era of US/Canadian economic ties “are officially declared severed.”
This sounds like Canada has willingly exited the USMCA trade agreement at a perfect time for President Trump. Of course, this is what PDJT wanted all along. If Trudeau is correct that Canada cannot survive in a balanced rules environment, then Carney has just nuked his own country. It will be interesting to watch. It may be time to load up on popcorn.
It should be noted that three provinces in Canada have expressed at least a passing interest in joining the US.