Trump Tariffs on Canadian Goods

Trump promises 25% tariff on Mexico and Canada, extra 10% tariff on China 

I've written prior on my belief we should return to a tariff system and do away with current trade agreements. I don't agree with a lot pundits out there calling tariffs "regressive" or whatever else. It's an economic system that benefits financial corporations at the expense of national industry and to protect Canadian labor, we never should've into the "Free" Trade agreements we had unilaterally imposed upon us by successive Liberal and Conservative governments.

Anyway, the reality of Trump Tariffs is they're coming in. Canada will need to match these tariffs, because Trump is going to unilaterally impose them. Trudeau can't appear weak, so he'll have to match each tariff. And to offset the costs of tariffs, Canada will have to kill the GST/HST, which they're actually already doing, albeit temporarily for other reasons. But GST/HST were imposed upon Canadians by the federal government to make up for the loss of revenue from duties (as well as the federal government raiding employment insurance) so returning to a tariff system will actually provide Canada with a considerable sum of revenue up front. The CRA will probably have to hire tens of thousands of border agents to inspect goods coming across the border, which leads into another point.

US president-elect says measures will remain until countries stamp out irregular border crossings and drug trafficking.

This is unlikely to ever happen. Or rather, Trump will move the goal-posts, because it's our current duty-free system that actually allows the majority of irregular border crossings and drug trafficking. Customs Agents on both sides of the border is a position that'll likely stamp this out fairly quickly. Trump will need to move the goalposts or simply ignore his original reason to keep up the excuse for maintaining duties on Canadian goods.

Another thing that'll probably happen is Trump will demand Canada match its tariffs on other nations to remain in America's "good" books, because the US can't have exporting nations cheating American tariffs by taking advantage of lower Canadian tariffs on those goods, so Canada will have to comply with these demands to keep American tariffs lower on Canadian goods.

Trump tariffs are likely here to stay. No politician is going to have the will to fight with the electorate on tariffs for a century. Financiers are trying right now to call them regressive, but this likely won't work. The American public is likely quite dead-set against "free" trade. It should be in the memories of quite a few forty-plus older voters the protests and riots that occurred in Canada and America through the 1990's after NAFTA was imposed upon us

This will have an immediate impact on towns near the border.

Towns near the border will see an immediate impact. Canada will need to hire Customs Agents to check on goods crossing the border. Canada will also need to set-up warehouses where goods will be off-loaded to allow for easy inspection and then re-loaded onto Canadian trucks. For the time being, goods will likely end-up at warehouses far from the borders, so until then, there'll be the opportunity for truckers to off-load their illegal goods and smuggled people in-between.

Duty Inspectors will likely need training up-front as this hasn't been done since the 1980's or even 1970's on a lot of goods. It shouldn't be that that difficult a job though. Stuff'll get offloaded from American trucks and counted and then reloaded on Canadian trucks in towns and cities near the border.

Abbottsford in BC, Lethbridge in Alberta, and other such cities will likely see revivals simply due to the transfer of goods.

We don't have policy in place to manage this and it'll be a disaster

I may sound enthused about this, but I'm not a Trump supporter. I think he's the walking definition of a clueless manager. None of Trump's team have likely thought about this at all. What it'll take to reimpose tariffs.

This could even become a major policy failure on both sides of the border if neither nation plans properly for it. We probably need to hire tens of thousands of people at the borders on both sides and major construction of warehouses to do this work, but that would involve government spending on both sides of the borders, and neither government seems prepared to do this at all. Canada's flatfooted and America's newly incoming administration is likely clueless. It'll be a fustercluck in every sense of the word until competent people get working on this. Not likely to happen because American politics are screwed up and Canadian politicians may be thinking that this is only temporary. It's likely not temporary. The next set of American politicians will probably run on fixing tariffs so that they work. Being better managers than Trump and shepherding in the next era of protectionist and isolationist American politics that seems to happen at least once a century.