Lament for a Nation
Classes are over, grades are submitted and now I can turn my attention to … all this. (Imagine a vague hand gesture and a pained expression here).
This past term, I taught Introduction to Political Science, and the students’ final assignment was to reflect on concepts we covered during the term that they found interesting. The most commonly mentioned were affective polarization1 and democratic backsliding.2 The kids are OK.
Now, I don’t imagine that Economics professors at the Wharton School in the 1960s were inclined to give final assignments like this one. But if they had, I’m willing to bet that Donald Trump’s key takeaway from Econ 101 would have been: tariffs. It’s the kind of concept that might have been covered early in the term, while students were still coming to class. If there’s a heaven for Economics professors, there’s surely a group of former Wharton profs huddled in a corner of that great faculty club in the sky asking one another ‘is this our legacy?’
The world is now doomed to spend the next four (or more) years focused on a singular question: what on earth is going on in Donald Trump’s mind? I don’t have a lot of insight here, but it does strike me that tariffs have become his answer to every possible policy challenge, his answer to all questions.
Want to bully your neighbours into patrolling the border for you? Threaten tariffs. Hoping to raise revenues to cover your income tax cuts? Tariffs. Want to encourage domestic manufacturing? Tariffs. (The heavenly chorus of economics profs are shouting something about inflation. But never mind…)
The difficulty for governments of US trading partners, as we’ve seen vividly displayed in Canada this week, is to try to guess which policy problem Trump is trying to fix with his single answer. Is it about patrolling the border? Maybe. Or perhaps it’s about raising revenues and encouraging domestic manufacturing. Who knows? But the reasoning matters a great deal. Because if the purpose of the tariff threat is not to prompt action about the border, it’s possible that Canada could build an impermeable wall along the 49th parallel and still get hit with 25% tariffs. Or that we could win a reprieve for a few months until Trump dreams up a new demand that must be met, or else…tariffs.
This has me thinking back to the Canadian federal election of 1988. The so-called ‘free trade election’ was a turning point for Canada, giving the Mulroney PCs a mandate to negotiate a free trade agreement with the United States. At the time, there was much angst about surrendering sovereignty to the Americans. During the English-language debate, Liberal leader John Turner claimed “We built a country east and west and north. We built it on an infrastructure that deliberately resisted the continental pressure of the United States. For 120 years we've done it. With one signature of a pen, you've reversed that, thrown us into the north–south influence of the United States and will reduce us, I am sure, to a colony of the United States, because when the economic levers go the political independence is sure to follow."
Once the FTA was signed, angst about Canadian political sovereignty gradually melted away. Jean Chrétien ran in 1993 on a promise to tear up the NAFTA agreement, but once elected promptly negotiated some side agreements and then signed it. And then we mostly stopped fretting about continental free trade and Canadian sovereignty and settled into a general consensus that we were better off with NAFTA than without it.
I’ve been imagining how the Ghost of NAFTA Future would have been received back in 1988, explaining that the threat to Canadian sovereignty would come in the form of a bombastic billionaire reality TV star who would treat Canada as a vassal state to be toyed with for his amusement. My recollection of that era is that casual anti-Americanism was quite common. Many on the center-left might have been inclined to believe in this absurd future (though there would have been some explaining about ‘reality TV’ which hadn’t been invented yet).
Whether it’s a function of continental free trade, globalization more generally, the advent of the Internet or other forces, the Canadian nationalism that animated opposition to free trade in 1988 is no longer a significant political force. We have accepted our place in an interconnected world and, at least until now, have benefitted from it.
But Canada faces a moment of reckoning. With a single social media post, Donald Trump has made it clear that our sovereignty is constrained. When he tells Canada to jump, our answer must be ‘how high’? Canada will not become the 51st state, as that would grant us a degree of influence. Rather, we become a vassal state, Belarus to Russia.
Perhaps this lament is overstated, like George Grant’s dire predictions in the 1960s that Canada was doomed to be integrated into the American empire. But the events of the past week - Canadian governments running in all directions, bumping into one another, in a panic over Trump’s first salvo - speak to the serious predicament we find ourselves in.
Perhaps at the end of next term, my Intro students will choose ‘sovereignty’ as the concept that grabbed them. Or ‘chaos theory.’ I’ll report back in April.
A belief that your political opponents are your enemy.
When governments in democratic states undermine or eliminate institutions and rules that sustain democracy.
Trump’s problem, and as a result ours, is that he sees the world as a series of zero sum games. There always has to be a winner and a loser. There concept of mutual benefit is beyond his ken.
Free trade has always been a big part of the problem...for the simple reason that such a pure state has never existed. But we fell for it, and a globalized market place did succeed in creating a couple of decades of expansion......if you overlook the fact that jobs in the American heartland disappeared to China and other parts of Asia where cheap labour could be exploited to increase corporate profits. We still had dust ups about trade that appeared to overly benefit Canada...soft wood lumber comes to mind...and there are lots of folks who don't understand supply management, and are eager to open our borders to what Americans call 'milk', cheaper of course though adulterated by American big ag ideas, and those savings in the mind of the average consumer make up for the fact Canadian dairy farms might well go under.
There needs to be some protectionism for national industries crucial to the national interest. We once had a state of the art laboratory where we made many of our own vaccines...Mulroney sold it as unnecessary given 'global supply chains'. So now everyone is dependent to some extent on those supply chains, as we found out in the famous toilet paper shortage at the start of covid.
But the sad fact is, the country to which American entre proners moved their factories is now eating our lunch...and climate change advances on all of us like a Hallowe'en horror movie. So tariffs it is......particularly for the People's Republic of China...growing approx 3 times faster than is the American economy.
The tarriffs won't work. It's too late for that. Americans need those cheap goods from away, they don't make much at home any more. But China? She has options...and retributions of her own she could bring to bear. So Trump's tarriffs may make money for his government...money lost when he gave away all that tax revenue to the rich in his first term. But the American people are in for it.
Canada should stay calm, carry on......and seriously ask ourselves, is Pierre the man to lead us through the next years......seeing that for him, all things must be broken??? Big changes are coming, but they won't achieve what the Donald imagines....and if we play our cards a bit close to the chest......they just may form a part of saving us from ourselves.
As Lisa says, 'there's nothing wrong with the kids'. We have a few Canadians left who can still think their way out of a wet paper bag as well. Let's all stay tuned, stay calm...and Stand with Canada.