Lately it's been snowing heavily here in Canada where I'm from. We've gotten dumped on a few times now. I mean that literally of course, but perhaps figuratively as well. Along with the snow a lot has been going on in the country and a lot of changes are being made. I'm talking about changes in policy and even more profoundly in the sentiment of the people as well.
You're probably aware that Canada has been put on the defensive as of late because of the comments and policies coming from the leader to the South. Each week there is a new threat it seems or a new concern to deal with. I want to give you an update on what's happening up here in Canada as a result of it all, what I'm seeing and what I'm hearing.
firstly though, I want to note that this post is not against Americans as a people in any way. As a people, Canadians and Americans share far more similarities than differences and the issue is not with the American people but more so with the government policies and certain comments from leaders that have threatened Canada as a country.
That being said, lets discuss.
This whole thing started back when the American president stated that he'd like to see "Canada become our 51st state." He said this around the same time that he also declared that he would take back the Panama Canal and that he also wants to take Greenland.
Not surprisingly, this comment really rubbed people the wrong way in Canada and I'm sure in those other countries as well. It's hard to know what the president's true intentions are but for the most part Canada hasn't taken the comment lightly and largely consider that it might have been a serious threat.
Some might say that it was only meant as a joke, but a joke is only a joke if it's funny and if both sides are laughing. In this case, no one is laughing in Canada. This comment is at best an act of dominance or insult and rightly so a lot of peoples backs are still up over it from what I'm seeing and hearing.
Next came the threat of tarrifs and implementation of the same. The president went back on the trade deal that he originally negotiated in his first term in office and threatening to add more tarrifs on Canada, to the tune of 25% on a wide range of products. He also added tarrifs to Canadian steel and aluminum and now those are currently in place. Last time this happened, Canada retaliated by putting tarrifs on specific American products that directly impacted the Senators of the US. The idea was to not go after the average citizen of America but instead the people in charge who would put pressure on the decisions makers. This time around Canada retaliated hard by threatening to put tarrifs on virtually everything from meats and produce to furniture to military munitions. The list is far too long to actually read but here is the link if you care to look at it.
**The problem with tarrifs is that they hurt both countries and ultimately its the average people that get screwed in the end. Its the importer who pays the tarrifs which naturally forces the company to raise their prices in order to pass that cost onto the end consumer. The theory is that the end consumer will turn away from the expensive imported good and buy a product that is produced in their own country because now it is the less expensive product. Aside from the retaliatory nature of tarrifs, another fallacy of this process stems from the fact that we live in a capitalistic society. When a competitor raises their price by 25% does anyone actually think that every other company is going to leave their pricing the same? Fuck no, they are going to takes advantage of the situation in order to make more profit. They are going to follow suit and raise their price by 15-20%. This way they still remain the less expensive product but they also gain that extra 15-20% profit. This is probably even more true for commodities that are unseen by the general public - like steel and aluminum. So when all of the goods on both sides of the border increase in cost I guess we can all thank the president for that. The moral of the story, tarrifs ultimately hurt both sides and are as much a punishment for your own people than those of the other country.
The repercussions of all that has been going on are interesting. Firstly, there has been a huge resurgence in national price. In a way it almost seems like people are more united together as Canadians. People are actively boycotting anything American and are seeking out Canadian products and choosing them over the alternative. I hear people talking about it at work and see it at the grocery store, people spending more time reading labels and looking for the origin of where a product is produced. We were at a local shop getting a picture framed and the store keeper told us that most customers were very interested to know where their products were produced. Before the tarrif threat on basic goods was extended for 30 more days I also heard of people talking about canceling trips to the US that they already had booked and not booking others in the future. The news is reporting fewer border crossings already.
Other repercussions include:
• The LCBO stopped selling American liquor and wine as of Feb 4th. For those of you who don't know, the LCBO is Ontarios main alcohol store. It is one of the world's largest single alcohol purchasers in the world next to some giants like Costco and other huge purchasers. Before this event it purchased over $900 million dollars of alcohol from the US and approximately 3600 different alcoholic products. Not anymore it seems. Link
• Strengthening Interal Trade. Previously it was actually easier for companies in the Canadian provinces to trade with the US than it was to trade with other provinces within Canada. The tarrif threat has acted as a catalyst though to revamp the rules in order to make intercountry trading easier and more efficient. Canada is moving rapidly to remove barriers to make intercountry trading more viable for companies and to make canada more self sufficient and not need to rely on the US for trade. Link
• Alternate Trading Partners. Canada has free trade agreements with the EU, Indo-Pacific Nations, Mexico, emerging markets and others. The premiere called for Canadian business to start better utilizing those other trading partners in order to further reduce the countries reliability on the US. Link
Its very unfortunate that the new president is actively taking steps and creating policy that not only threatens Canada and it's people but also largely pits the two countries against each other. Canada and the US are not only neighbors but they are also long standing allies and partners. I'm not sure why he is seeking to jeopardize that relationship but at this point he definitly has and is.
On a positive side for Canadians these acts have seemed to unite the people of Canada and started the process of eliminating unnecessary barriers within the country to make it self sufficient. It had also prompted Canada to seek out new allies and partners in other parts of the world. I think that Canada is the underdog in this story, but it's nice to see that it's not rolling over.
