LILLEY: Trudeau AWOL as Donald Trump throws his weight around

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Donald Trump wants to know why the United States is subsidizing Canada, as well as an explanation about why this is happening. Trump made the claim on his Truth Social account in the middle of the night.

He not only claimed the U.S. was subsidizing Canada but added once again that we should become the 51st state.

“No one can answer why we subsidize Canada to the tune of over $100 million a year?” Trump said.

“Makes no sense! Many Canadians want Canada to become the 51st State. They would save massively on taxes and military protection. I think it is a great idea. 51st State!!!”

Now, while Trump wrote $100 million, in the past, he’s said $100 billion, and according to several reports, that is the number he raised during his meeting with Prime Minister Justin Trudeau during their meeting at Mar-A-Lago. This is the type of thing that Trudeau should be pushing back against, using facts, and attempting to explain the Canadian side.

Trudeau is a bit busy these days with his political drama. He lost his finance minister, many in his own party are calling for him to resign, and the future of his government is at stake.

So, while Trudeau worries about himself, he doesn’t have time to worry about pesky things like Trump’s threat to put a 25% tariff on all Canadian goods.

Well, in Trudeau’s absence, let me break it down for you, Mr. President-elect.

You and your country are not subsidizing Canada at all. And there is no $100 billion trade deficit, and trade between Canada and the United States is quite balanced.

U.S. goods and services trade with Canada totalled an estimated $908.9 billion in 2022, says the website of the United States Trade Representative.

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“Exports were $427.7 billion; imports were $481.2 billion. The U.S. goods and services trade deficit with Canada was $53.5 billion in 2022.”

Those figures don’t tell the whole story.

We also need to account for foreign direct investment, and according to the USTR, American direct investment in Canada in 2022 was $438.8 billion, while Canadian direct investment in the United States was $589.3 billion.

That points to a $151 billion imbalance in direct foreign investment. Looks like the Americans are getting the better of the deal.

Now, as for the trade deficit in goods, that is primarily driven by the huge amount oil that the United States imports from Canada. The United States needs the oil and while it’s expected that Trump will expand drilling and production in the U.S., they will still need to import.

To add another layer to that, much of the oil that the Americans import from Canada is heavy oil which is used to make products like asphalt. The alternative markets for heavy oil are places like Venezuela or Iran.

A question Trump should be asking is whether he wants roads paved with oil that will enrich Venezuela President Nicolas Maduro’s government or Iran’s ayatollahs?

A lot of what Trump is putting out there is bluster, especially all the material about Canada being the 51st state. He knows that Justin Trudeau is in a weak spot right now, with the Liberals in disarray and support for the party falling.

He also knows that it’s unlikely Trudeau will be in power after the next election — whenever that comes. So, Trump takes shots at Trudeau, trying to intimidate and looking for an advantage in negotiations.

But while the stuff about annexing Canada is bluster, the threat of the tariffs is real. Sadly, we don’t have a government capable of offering a real response at the moment.

Thankfully, premiers are stepping up and offering border plans and making the American media rounds to make Canada’s case and defend our interests.

There are so many reasons that Trudeau should go, that we should have an election now, but the inability of Trudeau and his team to credibly deal with the Trump threat is the biggest one.

We need an election as soon as possible to install a new government with a strong mandate and the ability to deal with the threat before us.