Canada

Subterms

    More stories

    • 175 Shares159 Views

      in US Politics

      Tariffs can help US workers. But Trump’s doing them all wrong | Dustin Guastella

      by

      In the run-up to the 2024 election, a lot of people were ringing alarms about Donald Trump’s tariffs. Kamala Harris called Trump’s policies a “tax on the American people” and warned of sky-high prices. According to the Nobel prize-winning economist Joseph Stiglitz, they are “very bad for America and for the world”. His fellow Nobel laureate Paul Krugman called them “small, ugly, and stupid”. More recently, the whirlwind tariff drama of the past two months – first a 25% tariff on Mexico and Canada, then a 30-day “pause” on that policy, a plan to raise tariffs on steel, aluminum and agricultural goods, plus an across the board tariff hike on China – has generated yet more frenzied debate about the danger of tariffs.Observers aren’t wrong to criticize the US president’s policies. His proposed tariffs seem unlikely to improve what ails the US economy. Worse, applying tariffs as broadly as he’s proposed, and without any supplementary industrial strategy, does risk needlessly raising prices while acting like a big corporate giveaway. Yet, despite what elite economists say, tariffs can be sound, and progressive, economic policy.In fact, liberals might be surprised to learn that during his administration Joe Biden actually raised the highest tariffs in recent American history: a 100% tariff on Chinese electric vehicles. Why? Because tariffs work.Tariffs are, simply put, taxes on certain imported goods, paid by the importer. The goal is to make foreign products more expensive than their Made-In-USA counterparts. This is why people refer to tariffs as “walls” that help “protect” domestic industry from global competition. Right now, China quickly and efficiently produces fleets of electric vehicles that are – thanks to the low cost of Chinese labor – a lot cheaper than the EVs made in the United States. Without tariffs, it would be impossible for US-made models to compete. Since making electric cars was a big goal for Biden, his administration raised an eye-watering tariff that would double the price of any Chinese-made import.The EV example is useful because it demonstrates the difference between Biden’s tariff policies and Trump’s.Trump has, for the most part, not focused on raising tariffs on particular imported goods but instead on all goods coming from certain countries. Mexico and Canada face across-the-board tariffs; China was already facing 10% tariffs, doubling to 20%. But raising the prices of all products from these countries doesn’t help develop any particular line of US manufacturing. Tariffs like these are both too broad and too small to make a positive impact. A 20% tariff on all Chinese goods might make it more expensive for Americans to continue to buy certain things from China. But nothing in that policy encourages Americans to buy American-made products; they might just as well find a Vietnamese supplier to avoid the tariff while continuing to reap the benefits of cheap labor. Moreover, it’s possible that some Chinese manufacturers will simply eat the additional costs and sell their goods at slightly slimmer profit margins. Or, equally likely, they will try to avoid the tariffs by having other companies assemble their products in neighboring countries before sending them to the US. As is, Trump’s country-based tariffs seem more like a geopolitical tool than an economic one. Frankly, they don’t make much sense if the goal is to bring factories home.Trump’s steel and aluminum tariffs are closer to the mark. By making all steel imports (regardless of national origin) subject to the same tariff, the policy could succeed in making US steel comparatively cheaper for domestic buyers.View image in fullscreenYet even this wouldn’t make US steel bigger or better, or make its production more efficient. Nor would it necessarily raise the wages of steel workers. Pure and simple protectionism will benefit existing US steel manufacturers, but no one much beyond that. Without the government stepping in to develop new manufacturing – encouraging the adoption of the latest techniques to make a superior product, actively building new demand for American steel, or providing social guarantees for steel workers – tariffs alone risk protecting a sick industry without much upside.So what would a labor-forward tariff program look like? It would combine tariffs with big investments in infrastructure to help steer industry, and the country, into better economic health.For steel, such a fix isn’t hard to imagine. The US benefits from being a continental-sized country, with hundreds of thousands of bridges, school buildings, libraries, miles of rail and highway. All of those things are made with steel. And all of them are falling apart. Major new investments in infrastructure upgrades would provide the tariff-protected steel industry the new demand needed to grow, and provide the requisite scale for industrial dynamism.In exchange, steel firms should be required to provide family-sustaining wages and benefits, and promise to stay neutral in union elections. Not only this, but the government should have some say in actually directing the production process. New steel plants should be built in places that need jobs, not isolated tax-free industrial parks, but in the very same areas that were obliterated by deindustrialization. That is, production should be directed, first and foremost, toward public use and social ends.Some might wonder: why bother with such an expensive experiment?Manufacturing is still a huge part of the US economy and it is among the only sectors that consistently provides high wages for a large base of workers. Protecting that industrial foundation is essential not only for those workers, but for the health of other sectors too. When a factory closes, it’s not just the high-wage blue-collar workers who are thrown out of jobs. So are all the middle-income truck drivers who deliver the goods. And all the high-skilled mechanics who fix the machines. Not to mention the servers and cooks who staff now empty local restaurants. The only businesses that grow in the wake of a factory closing are those related to opioids and alcohol.Since Nafta was signed, tens of thousands of factories have closed in the US. Millions of largely union jobs have been lost. This fact alone explains so much of the populist revolt against globalization. And while it’s unlikely that we could ever return to the industrial output of 1946, is it that hard to imagine returning to 1994? If Pearl Jam is still making albums, can’t the US still make steel?Rebuilding our manufacturing capacity will be a big part of building a better country. And tariffs – deployed wisely with big investments – are an indispensable tool for doing so.

      Dustin Guastella is a research associate at the Center for Working Class Politics and the director of operations for Teamsters Local 623 More

    • 75 Shares159 Views

      in Elections

      Europe Warily Watches U.S.-China Trade War

      by

      Europe was not directly targeted in the wave of U.S. tariffs that took effect on Tuesday, but the effects are being felt here.Keyu Jin, a professor at the London School of Economics, said that tit-for-tat tariffs would not necessarily lead to less global trade, but a “fragmentation and regionalism” that forges new blocs aiming to be “nonaligned” in the intensifying trade war between the United States, its neighbors and China.She was speaking on a panel Tuesday in Barcelona at one of the world’s biggest tech trade shows, which runs this week. The annual event, known as Mobile World Congress, attracts more than 100,000 people for product pitches, fund-raising appeals and debates about the future of technology.The fresh U.S. tariffs on Canada, China and Mexico — the three largest U.S. trading partners and crucial cogs in many supply chains — were a common topic of conversation around the sprawling expo center. European companies are heavily represented at the event, and some executives tried to frame the rising trade tensions as an opportunity for Europe, whose sizable population and economy has often been held back by slow growth and a lack of competitiveness.The recent mobilization of European leaders to step up military support of Ukraine was cited as an example of deeper European integration that in the past has tended to fizzle out. But the suspension of U.S. aid and the urgency of Ukraine’s plight — Prime Minister Keir Starmer of Britain recently described it as “a crossroads in history” — could spur greater continental cooperation, executives said.Investors have piled into stocks of European defense companies that stand to benefit from stepped-up military spending. And European markets, in general, have outperformed U.S. stocks in recent weeks, even after slipping on Tuesday after the U.S. tariffs went into effect and some targeted countries retaliated.Some of the tech execs in Barcelona say this is not a coincidence: Companies with Europe-focused operations and supply chains may be seen by global investors as a sort of geopolitical hedge against the tariffs and trade tensions arising from the United States. Take, for example, the stock market index tracking European telecoms, long seen as a somewhat sleepy backwater, which is up about 12 percent this year alone.But this thesis will be tested soon, when President Trump plans to widen the scope of tariffs to cover all U.S. imports of steel, aluminum, copper and cars, as well as “reciprocal” tariffs against countries to address what he calls “unfair” relationships and to compel companies to move manufacturing to the United States. More

    • 63 Shares129 Views

      in Elections

      Trump’s Tariffs Hit Stock Markets

      by

      Global leaders are retaliating and investors have sold off stocks in Asia and Europe.Nowhere to hide as a new wave of U.S. tariffs sinks global stock markets.Franck Robichon/EPA, via ShutterstockNot just tough talk President Trump wasn’t bluffing, after all.Global markets plunged on Tuesday after U.S. tariffs went into effect on roughly $1.5 trillion worth of imports from Canada, Mexico and China, with another, and even broader, wave set to kick in as soon as next week.China and Canada have already responded, with Beijing targeting the American heartland with sweeping levies on imported food and halting log and soybean shipments from select U.S. companies. Mexico is expected to retaliate, too.The escalation has global business leaders increasingly worried about what will come next, as economists warn that consumers and companies will soon see higher prices. Warren Buffett offered a reminder of what the global economy is facing. “Tariffs,” the billionaire investor said this week, “are an act of war, to some degree.”Here’s the latest:Stocks in much of Asia and Europe fell on Tuesday, after the S&P 500 yesterday suffered its worst one-day decline this year. U.S. stock futures were down slightly on Tuesday.Hit especially hard on Tuesday were the shares of European automakers, including Volkswagen, BMW, and Daimler Truck. Levies could slam the sector, which is highly dependent on a complex cross-border supply chain.The CBOE volatility index, Wall Street’s so-called fear gauge popularly known as the VIX, jumped, posting its biggest one-day spike this year, according to Deutsche Bank.The sell-off also extended to cryptocurrencies (more on that below), and, in a new twist, the dollar.If global investors weren’t spooked before, they seem to be now. “The market finally took the Trump administration at its word, and the realization that the tariff talk wasn’t just a negotiating tactic is starting to sink in,” Chris Zaccarelli, an investment strategist for Northlight Asset Management, said in a research note yesterday evening.How long will the trade battle last? Analysts see reason for cautious optimism — at least on China. “We view Beijing’s responses as still strategic and restrained,” Xiangrong Yu, Citigroup’s chief China economist, said in a research note on Tuesday. He said a trade deal was still “plausible.”The Shanghai composite index closed slightly higher on Tuesday.Market watchers warn of deep repercussions should the trade war drag on. Trump seems to be digging in, telling reporters yesterday that there is “no room left for Mexico or for Canada.” A protracted fight could dent global growth and accelerate inflation, all of which could “hamstring the Fed,” Mark Haefele, the chief investment officer at UBS Global Wealth Management, told Bloomberg Television on Tuesday.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

    • 138 Shares189 Views

      in US Politics

      China and Canada retaliate after Trump trade tariffs come into effect

      by

      China and Canada unveiled retaliatory measures against the US after Donald Trump imposed his sweeping tariffs plan at midnight US time, despite warnings it could spark an escalating trade war.US tariffs have come into force of 25% against goods from Canada and Mexico, the US’s two biggest trading partners, and 20% tariffs against China – doubling the levy on China from last month.The duties will affect more than $918bn-worth (£722bn) of US imports from Canada and Mexico.China on Tuesday said it would impose fresh tariffs on a range of agricultural imports from the US next week. Its finance ministry said additional 15% tariffs would be imposed on chicken, wheat, corn and cotton, with further 10% tariffs on sorghum, soya beans, pork, beef, aquatic products, fruits, vegetables and dairy products.The Canadian prime minister, Justin Trudeau, said Ottawa would respond with immediate 25% tariffs on C$30bn-worth ($20.7bn) of US imports. He said previously that Canada would target US beer, wine, bourbon, home appliances and Florida orange juice.Tariffs will be placed on another C$125bn ($86.2bn) of US goods if Trump’s tariffs were still in place in 21 days.“Tariffs will disrupt an incredibly successful trading relationship,” Trudeau said, adding that they would violate the US-Mexico-Canada free trade agreement signed by Trump during his first term.Mexico’s president, Claudia Sheinbaum, was expected to announce her response on Tuesday morning, the country’s economy ministry said.Asian markets were down – after sharp falls in US markets on Monday – as Japan’s Nikkei fell 1.6%, Taiwan’s benchmark TWII index was off 0.5% and Hong Kong’s Hang Seng was down 0.$%.The Canadian dollar and the Mexican peso fell to their lowest levels in a month on Tuesday.In Europe, the FTSE 100 dropped by 57 points, or 0.65%, at the start of trading to 8,813 points, a day after rising more than 8,900 points for the first time. France’s CAC 40 fell 0.9% and Spain’s Ibex was down 0.8%.Trump and his allies claim that higher tariffs on US imports from across the world will help make America great again by enabling it to obtain political and economic concessions from allies and rivals on the global stage.Businesses, inside the US and worldwide, have warned of widespread disruption if the Trump administration pushes ahead with this strategy.Since winning November’s presidential election, the president has focused on China, Canada and Mexico, threatening the three markets with steep duties on their exports unless they reduced the “unacceptable” levels of illegal drugs crossing into the US.skip past newsletter promotionafter newsletter promotionWhile he slapped a 10% tariff on China last month, Trump has repeatedly delayed the imposition of tariffs on Canada and Mexico. The president has pledged to bring down prices in the US, but economists have warned that consumers in the country could be aversely affected by his trade plans.A 25% tariff on Canada and Mexico and a 10% levy on China would amount to “the largest tax increase in at least a generation”, according to the Peterson Institute for International Economics, a thinktank, which estimated such a move would cost the typical US household more than $1,200 each year.Trump has vowed to go further, threatening to introduce “reciprocal” tariffs on countries that have their own duties on goods made in the US. He has said these will come into effect as soon as next month.China’s finance ministry said in a statement: “The US’s unilateral tariff increase damages the multilateral trading system, increases the burden on US companies and consumers, and undermines the foundation of economic and trade cooperation between China and the US.”The ministry said products shipped from the US to China that departed before 10 March and arrived before 12 April would not be subject to the tariffs.Trump has said the tariffs on China are because the government has failed to stop illicit fentanyl entering the US, which Beijing says is a “pretext” to threaten China.“China opposes this move and will do what is necessary to firmly safeguard its legitimate interests,” a foreign ministry spokesperson, Lin Jian, said.Chris Weston, an analyst at the brokerage Pepperstone, said: “Market anxiety levels have been dialled up, and we see traders having to react aggressively and dynamically to the deluge of headlines and social posts confirming that tariffs on China, Mexico and Canada are to be implemented in full and as threatened.” More

    • 175 Shares169 Views

      in Elections

      In Speech to Congress, Trump Is Expected to Boast About DOGE Cuts and Ukraine

      by

      President Trump is expected to boast about his assault on the federal bureaucracy and his efforts to upend global relationships during an address to a joint session of Congress on Tuesday, even as his administration faces lawsuits over his domestic agenda and Europe rebukes him over his treatment of Ukraine.Addressing his largest television audience since his return to power, Mr. Trump is expected to speak about the speed with which he has pushed through reductions in border crossings, cuts to government through the Department of Government Efficiency, known as DOGE, and a slew of executive orders. He is also expected to emphasize the need to pass his legislative agenda, which includes some $4 trillion in tax cuts.“He’s going to talk about the great things he’s done: The border’s secure, the waste he’s finding with DOGE,” said Representative Jim Jordan, Republican of Ohio and the chairman of the Judiciary Committee, who speaks frequently with Mr. Trump. “He’s going to keep laying out his vision, where he wants the country to go.”For Mr. Trump, it will be a remarkable return to a chamber — and a prime-time, nationwide audience — he last addressed five years ago, before voters ousted him from office and replaced him with Joseph R. Biden Jr. Mr. Trump’s return has set in motion a rapid-fire series of actions designed to overturn decades of policy and diplomacy.During his first term, the president delivered an annual speech to Congress that included a mix of exaggerations and grievance-filled attacks on his enemies. He is poised to do the same again on Tuesday night, using one of the largest platforms that any modern president gets during his time in the Oval Office.Mr. Trump hinted on Monday that he might use the speech to extend his public feud with President Volodymyr Zelensky of Ukraine after the Oval Office blowup between the two leaders last week. Asked by a reporter whether a deal to share rare-earth minerals was still possible after the shouting, Mr. Trump said that “I’ll let you know,” adding: “We’re making a speech, you probably heard.”We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More

    • 175 Shares109 Views

      in US Politics

      Trump says ‘no room left’ for deal that avoids tariffs on Mexico and Canada

      by

      The US will press ahead with steep tariffs on Canada and Mexico from Tuesday, Donald Trump has said, setting the stage for a trade war with his country’s two largest economic partners.Hours before his administration was due to hit America’s closest neighbors with sweeping import duties, the US president claimed there was “no room left” for a deal to avoid their imposition. The announcement led to a sharp sell-off on Wall Street.All Mexican exports to the US are set to face a levy of 25% under the plans. Most Canadian exports will face a 25% tariff, with energy products facing a 10% duty.Trump also indicated that an additional 10% levy on China – on top of the 10% introduced last month – will also be introduced. Tariffs are a “very powerful weapon”, he told reporters at a news conference.The action is set to prompt swift retaliation. “We’re ready,” said the Canadian foreign minister, Mélanie Joly.Wall Street fell sharply after Trump’s remarks, with the S&P 500 down 1.7%, the Dow Jones industrial average down 1.5%, and the tech-heavy Nasdaq dropping over 2.6%.The tariffs will affect $900bn in annual imports from Canada and Mexico. The Ford CEO, Jim Farley, has warned they threaten to “blow a hole” in US industry.Trump has reluctantly conceded in recent weeks that higher tariffs could lead to higher prices in the US, but suggested the impact would be worth the cost. He has brushed off calls to tread carefully, escalating threats to go further.“Tariffs are easy, they’re fast, they’re efficient, and they bring fairness,” Trump said. He described the levies as a “a powerful weapon” that other presidents had not used because “they were dishonest, stupid or paid off in some other form”.Trump even took a swipe at Republican hero and staunch free-trader president, Ronald Reagan. “I’m a huge fan of Ronald Reagan but he was very bad on trade,” said Trump.Tariffs are “an act of war, to some degree”, the billionaire investor Warren Buffett warned recently. “Over time, they are a tax on goods,” he told CBS News. “I mean, the Tooth Fairy doesn’t pay ’em!”skip past newsletter promotionafter newsletter promotionOn Monday, Trump also pledged to impose tariffs on overseas agricultural goods within weeks. He claimed his administration would introduce tariffs on farm products from 2 April.A string of such deadlines – including vows to hit Canada and Mexico with tariffs in January, and then February – have been delayed, however, as economists and business leaders urge caution.“To the Great Farmers of the United States: Get ready to start making a lot of agricultural product to be sold INSIDE of the United States,” Trump wrote on Truth Social, his social network, on Monday. “Tariffs will go on external product on April 2nd. Have fun!” More

    • 200 Shares159 Views

      in US Politics

      US tariffs on Canada and Mexico coming Tuesday but may not be 25%, commerce chief says

      by

      Donald Trump’s commerce secretary, Howard Lutnick, said on Sunday that US tariffs on Canada and Mexico will go into effect on Tuesday, but the president would determine whether to stick with the planned 25% level.“That is a fluid situation,” Lutnick told the Fox News program Sunday Morning Futures.“There are going to be tariffs on Tuesday on Mexico and Canada. Exactly what they are, we’re going to leave that for the president and his team to negotiate.”Lutnick’s comments were the first indication from Trump’s administration that it may not impose the full threatened 25% tariffs on all goods from Mexico and non-energy imports from Canada.He said the two countries have “done a reasonable job” securing their borders with the United States, though he maintained the deadly drug fentanyl continues to flow into the country.Trump sowed confusion last week when he mentioned a possible 2 April deadline in connection with tariffs on Canada and Mexico. But he later reaffirmed the Tuesday deadline and said he would add another 10% tariff on Chinese goods that day, effectively doubling 10% duties imposed on 4 February.Lutnick said Trump was expected to raise tariffs on China on Tuesday unless the country ends fentanyl trafficking into the US. More

    • 113 Shares109 Views

      in Elections

      Trump Picks Another Trade Fight With Canada Over Lumber

      by

      The president initiated an investigation that could lead to tariffs on lumber imports, nearly half of which comes from Canada.President Trump on Saturday initiated an investigation into whether imports of lumber threaten America’s national security, a step that is likely to further inflame relations with Canada, the largest exporter of wood to the United States.The president directed his commerce secretary, Howard Lutnick, to carry out the investigation. The results of the inquiry could allow the president to apply tariffs to lumber imports. A White House official declined to say how long the inquiry would take.An executive memorandum signed by Mr. Trump ordered the investigation and was accompanied by another document that White House officials said would expand the volume of lumber offered for sale each year, increasing supply and helping to ensure that timber prices do not rise.The trade inquiry is likely to further anger Canada. Some of its citizens have called for boycotts of American products over Mr. Trump’s plans to impose tariffs on all Canadian imports beginning on Tuesday. The president, who also plans to hit Mexico with similar tariffs, says the levies are punishment for failure to stem the flow of drugs and migrants into the United States.Many Canadians have contested Mr. Trump’s assertion that fentanyl is flowing from its country into the United States.Canada and the United States have sparred over protections in the lumber industry for decades. The countries have protected their own industries with tariffs and other trade measures, and argued about the legitimacy of those measures in disputes both under the North American Free Trade Agreement and at the World Trade Organization.We are having trouble retrieving the article content.Please enable JavaScript in your browser settings.Thank you for your patience while we verify access. If you are in Reader mode please exit and log into your Times account, or subscribe for all of The Times.Thank you for your patience while we verify access.Already a subscriber? Log in.Want all of The Times? Subscribe. More