EDITORIAL: Forget ‘elbows up’ and get a trade deal

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Despite his “elbows up” rhetoric during the election, the only way Prime Minister Mark Carney can succeed in Canada’s ongoing trade war with U.S. President Donald Trump is to successfully negotiate a deal with our largest trading partner. 

That’s why the fact the two sides are seriously working towards one and even that a deal may be imminent — first reported by Postmedia columnist Brian Lilley — is the first positive news Canadians have heard on the trade front for a long time. 

What’s at stake is underscored by word on Thursday that Canada recorded its largest merchandise trade deficit on record in April, the first full month of the tariff war — $7.1 billion compared to $2.3 billion in March. 

Katherine Judge, executive director and senior economist at CIBC Capital Markets, told The Canadian Press those numbers are “really bad. Essentially trade has totally collapsed” despite Canada’s increased trade with other countries, because of the enormity of the deficit with the U.S. 

Indeed, it’s counter-intuitive a deal may be on the horizon — possibly before the G7 meeting to be hosted by Carney from June 15-17 in Kananaskis, Alberta, as Lilley reported — when on Wednesday Trump doubled his 25% tariff on steel and aluminum to 50%, which Carney called “unlawful, unjustified and illogical.” 

So it’s positive news that Canada and the U.S. are apparently working toward a resolution, with the caveat that the goal isn’t to get any deal with the Trump administration, but a deal that is fair to Canada. 

Reports about the talks say this isn’t a renegotiation of the Canada-U.S.-Mexico Agreement (CUSMA) on trade that Trump called “the best and most important trade deal ever made by the USA” when he agreed to it during his first term as president, which he now says was a terrible deal. 

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Rather, it would reportedly be a broad-strokes agreement in specific areas such as the auto sector, critical minerals, defence spending and North American safety and security, with more contentious issues such as supply management and Canada’s controversial digital services tax, along with renegotiating CUSMA, put off to a later date. 

The obvious concern is whether Trump will abide by any agreement he signs, since he has already blown up existing ones.