Summary
Canadian Prime Minister Justin Trudeau announced retaliatory tariffs after Donald Trump confirmed 25% tariffs on Canadian goods and 10% on energy, set to take effect at 12:01 a.m. Tuesday.
Trump justified the move by linking it to fentanyl smuggling concerns.
Trudeau called the tariffs “unjustified” and imposed 25% tariffs on $155 billion in U.S. goods, with $30 billion effective immediately and the rest in 21 days.
He warned of price hikes and job losses in the U.S., arguing the move violates Trump’s own trade agreement from his last term.
My understanding is that when the americans institute their tariffs, all canadian products become more expensive for americans and not price competitive with local american products. This results in a decrease of purchasing from Canada.
If we do nothing, then Canadians are still buying just as much american as before and there are little to no consequences for the tariffs
With tariffs on both sides, the effect is roughly “equalized” in that we are both now buying more local goods and less trade over the border