The current lesson for Canadians from Trump’s tariff threats, along with the broader climate of tariffs and trade pressures, has thrust Canada-U.S. relations into the spotlight.
While many experts argue that certain U.S. measures are hasty—and even potentially illegal under American law—the fact remains that Canada finds itself in a precarious situation. President Donald Trump’s unilateral moves, including tariffs and citing national security concerns at the northern border, have sown confusion and economic strain.
Although the imposition of these tariffs has been paused for 30 days, the threat of them has left a scar on many Canadians as to how they feel about our ally to the south. Canadians will remember this for a long time. Even with the tariffs paused Canadians are making purchasing decisions to avoid buying American products where possible. I fear this scar will remain for a long time. What was once considered our closest friend; one where we proudly shared the longest unguarded border in the world, has now shown their intention to attack our economy with guns blazing. This is not how diplomacy works. Can we blame it on one man? As much as we would like to, the responsibility is shared. The Republicans did not dissuade him from taking such rash actions. Furthermore, he campaigned on it, and many knowingly (many did not) backed his tariff talk on Canada.
Another Indication
The other indication from Trump is that the US has been taken advantage of by other countries. By all measures, the most powerful country on the planet with some of the most powerful companies in the world has always flexed its power in every negotiation (and that is coming from many Americans I have spoken to). So that is just completely false.
Despite this turbulence, cross-border relationships remain crucial, and Canadians will continue to do business with American partners. However, the emergency security rationale for these tariffs, stopping fentanyl at the border, when the total capture of fentanyl flowing into the US from Canada amounted to 43 pounds in 2024, is frankly insulting to Canadians.
Robert Putnam’s concept of social capital emphasizes the importance of trust, networks, and civic engagement in strengthening communities and institutions. In Canada-US relations, social capital is evident in deep economic ties, shared cultural values, and cooperative diplomacy, fostering mutual trust and collaboration. The US, with one move, has eaten away at that hard earned social capital (others may call it goodwill). I will give you three easy examples of the building up of social capital from the Canadian efforts: it was the Canadian embassy that risked their lives to sneak out American hostages from Tehran in 1979/1980, we were by the American’s side in both Afghanistan and Iraq. No doubt that there can be trade irritants or irritants with our level of military spending, but if there are irritants, they should be resolved at the negotiating table—not through economic warfare against an ally who has stood shoulder to shoulder with the United States.
The Latest Dispute
This latest dispute has laid bare the vulnerabilities of overreliance on the U.S. market. It is time for Canadian politicians and businesses to take meaningful steps toward economic diversification. This includes strengthening trade relationships with other international partners, as well as breaking down barriers within our own borders. Interprovincial trade remains frustratingly restricted in many industries, limiting Canadian companies from scaling efficiently within their own country. And yes, we need to think about pipelines as well. The fact that our crude oil does not flow out of Alberta and to the east is a complete miss of a market opportunity. While Canada does have domestic refining capabilities, they are insufficient to handle the total volume of crude oil produced. We must change that. This moment should serve as a wake-up call to remove those barriers and build a more self-reliant and resilient economy.
Conclusion
While the United States will always be an important trading partner, this episode should make it clear that Canada must chart a more independent economic course. In a future article, I will explore how Canadians can apply this thinking to the relocation industry and the benefits of choosing Canadian relocation services. But for now, the broader lesson is clear: Canada must act decisively to protect its economic future.
