National

Trump tariffs collide with Canada’s ‘elbows up’ mentality

During the federal election, Prime Minister Mark Carney sold Canadians on the promise of ‘elbows up.’ With a resume showcasing top-tier experience, he made it clear through his sloganeering and policy chops that he was ready to take on the job, to deliver results for Canadians and protect trade-exposed industries like auto, steel and aluminum, and forestry. 

It’s been three months since the election, when Carney came out of the gate swinging. During the first weeks of his mandate, he travelled to Washington, laying on a charm offensive that earned kind words from President Trump and secured him a government approval rating not seen since the early days of the pandemic. At one point during the G-7 Summit hosted in Kananaskis, Alberta, both sides suggested a deal would be done in 30-days.

That window has since come and gone, and tensions have become more hostile. President Donald Trump even suspended negotiations at one point due to the Carney government’s refusal to roll back the Trudeau-era Digital Services Tax, which applied to foreign-owned companies like Amazon and Airbnb. While Canada quickly acquiesced, it was an early foreshadowing of the difficult path ahead.

Carney recently signalled that tariffs in some form are likely to persist, even if an agreement is announced. It also remains unclear what bargaining chips are being leveraged at the negotiating table. 

The easy answer is to blame Trump for his volatile and inconsistent behaviour and to point to other countries that have fared poorly in negotiating favourable outcomes. Even if Canada secures what is viewed as an objectively good deal, this is just the beginning. The Canada-United States-Mexico Agreement is set to be formally renegotiated in 2026, which will inevitably invoke further whiplash.

Two things can be true simultaneously: Canadians have rallied around the flag and bought into the ‘elbows up’ narrative, and Trump is indeed a wild card. 

However, this show of goodwill likely has an expiration date, as does the idea that Canada can do nothing more while the very real impact of the Trump administration’s tariff policies set in and continue to ripple through the Canadian economy.

If Carney’s answer to the Trump problem is to seek allyship beyond North America, it will take more than virtue signalling at the upcoming U.N. General Assembly. And while commitments around defence spending and meeting NATO targets are a step in the right direction, Carney will face parliamentary scrutiny when he lays out his fiscal projections in the fall federal budget. It’s not yet clear if Canadians will have the stomach to bear the cost commitments made over the last couple of months. 

With an eye to the fall, it’s important to remember that Carney is not the first prime minister to promise bold leadership, and he won’t be the last. But like those who came before him, he may just end up suffering a similar fate if he can’t deliver on his promises.

 

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