EDITORIAL: Time to rethink our counter-tariff policy

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Industry Minister Melanie Joly says “Canada is the only country on earth, along with China, that has imposed so many counter-tariffs” on the U.S.

It’s time for Prime Minister Mark Carney to revisit that strategy.

Canadian counter-tariffs on American goods increase the cost of living for Canadians and damage Canadian businesses relying on products imported from the U.S.

Their ostensible purpose is to make these goods less desirable for Canadians to buy, by raising their prices, reducing demand in Canada and sending a message to U.S. President Donald Trump to reverse his imposition of tariffs on Canadian goods.

The problem is that the U.S. economy is 10 times the size of Canada’s, which means it will inevitably win a dollar-for-dollar tariff war and prompt further tariff retaliation by Trump.

Carney knows this. It’s why he has changed his position from the time he was running for the Liberal leadership, when he supported “dollar-for-dollar retaliatory tariffs.”

That was an “elbows up” political response to Trump’s tariffs, but it was never an effective economic one.

Carney acknowledged that in April when he suspended Canadian counter-tariffs on imported American products used in the auto sector, in manufacturing, processing and food and beverage packaging and on imported U.S. goods used for public health, health care, public safety and national security.

These suspensions — most for six months — were to give Canadian companies time to adjust to the economic damage Canada’s counter-tariffs would cause them.

It’s also why Carney hasn’t introduced counter-tariffs in response to Trump doubling U.S. tariffs on aluminum and steel to 50% in June.

Nor has he responded to a new 50% U.S. tariff on imported copper and a new 35% tariff on Canadian imports not covered by the Canada-US-Mexico Agreement (CUSMA) on trade, scheduled for Aug. 1.

Carney is waiting to see where Canada-U.S. negotiations on a new trade and security deal stand on Aug. 1, before deciding what Canada’s response will be if the two countries fail to reach an agreement by then.

That response should not be more counter-tariffs, because it will just add to the economic damage Trump’s tariffs are already causing our economy, unless the prime minister can explain how they will make our economy stronger.

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