New Normal, New Problems

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HERE'S MY TAKE

U.S. President Donald Trump hasn’t imposed his tariffs on Canada yet. His last-minute, 30-day reprieve (four days of which are now gone) gives us time to catch our collective breath and take stock.

The Wall Street Journal called it “the dumbest trade war in history.” Most I spoke to agreed, but they did point to one beneficial outcome: Canadian leaders are now focusing on a series of long-standing policy problems as never before. “The benefit of Trump is that he is forcing Canada to grow up and do some things that, if we were a responsible country, we would have addressed years ago,” one CEO told me.

Here’s what he’s seen in the last few months, which I agree would be genuine, nation-building progress:

• Canadians are uniting with a sense of patriotic purpose.
• Our politicians (and hopefully the public) are starting to take defence and border security much more seriously.
• Leaders may finally be summoning the national will to eliminate interprovincial trade barriers.
• There seems to be a new willingness to build energy infrastructure so that we are not beholden to a single customer for our energy exports.

The Globe and Mail agrees, editorializing on Tuesday that “Mr. Trump has done Canada one big favour” and that the days of complacency in which Canada avoided hard choices “are done.” In the midst of storms, we need to see and appreciate the silver linings. Redefining the Canadian political normal is good and necessary. It wasn’t President Trump’s job (nor, I suspect, his objective) to do so, but it is a consequence of his actions.

However, “the dumbest trade war in history” has also led to a redefinition of the norms of public speech and international commitments, which is not a good thing.

All countries should be troubled by President Trump’s willingness to use “emergency economic powers” to impose tariffs after suspending his commitments in the United States-Mexico-Canada Agreement (USMCA). President Trump himself negotiated the agreement in his first term, at that time calling it “the fairest, most balanced, and beneficial trade agreement” the U.S. had ever made. While we may chuckle at the irony of the U.S. president now bemoaning the USMCA and other trade deals – “they’re so bad” – the consequence for the international order is troubling. The past weekend was just a microcosm of the grand reality that President Trump is neither trustworthy nor reliable. There is a ready provision for the United States to change its mind and impose tariffs, as the USMCA was scheduled for review and possible renegotiation in 2026. So, starting an economic war, disregarding international agreements, and using an “emergency” fig leaf is a problem.

Consider what occurred over 48 hours last weekend to illustrate how meaningless words and public dialogue have become. 

• On Saturday, February 1, President Trump signed the executive order imposing a 25% tariff on all Canadian goods (with 10% on energy) effective Tuesday, February 4. The official documents claimed a fentanyl emergency justified this and the White House backgrounders referenced all sorts of issues. Still, President Trump told reporters there was “nothing” Canada could do to prevent the tariffs' implementation and if Canada retaliated, he would only increase the tariff levels.
• On February 2, Prime Minister Trudeau announced a phased-in program of retaliatory tariffs, reluctantly accepting the need to respond to the U.S. actions. His approach was generally supported across the political spectrum and in provincial capitals.
• On February 3, the rhetoric continued throughout the day, with President Trump repeating his desire to make Canada a 51st state and questioning whether it is “a viable country.”
• Late in the afternoon on February 3, President Trump and Prime Minister Trudeau announced they had reached a deal to delay the tariff implementation for at least 30 days. Of the various initiatives announced, most seemed to be a repackaging of commitments already made, save for the appointment of a Canadian “fentanyl czar” and the listing of certain drug cartels as terrorists.

President Trump is not the only politician with a loose commitment to truthful communications. I’m not naively blind to negotiation and communication tactics, not to mention the need to adjust positions to deal with changing realities. However, this is only a micro-example of the changing norms that President Trump is applying to public communication, something consequential regardless of who is doing it, but especially problematic when it comes from the leader of the most powerful western democracy. When tin-pot dictators huff and puff, we ignore the bluster and figure out our response by evaluating their actual power and self-interest. However, a higher standard applies to the president of the United States.

President Trump is laying waste to international norms that include principles like respect, honour, and dignity. He’s willing to make destabilizing and false arguments with significant consequences for both his own country’s citizens as well as others and to throw around U.S. economic weight to bully other nations. He is openly musing about the “manifest destiny” of the United States and mocking other countries, questioning their sovereignty and treating it as a commodity for sale. The international order survives because of mutually respectful relationships among unequal powers. Sovereignty belongs to the category of dignity and self-respect, and it is reprehensibly insulting to disregard other countries’ sovereignty as if they’re available to be prostituted with only the price to be negotiated.

This is a very unhealthy new “normal.” When behavioural norms change, they change for everyone. And the world is a less stable and potentially a less just place today. President Trump’s business career was marked by a practice of forcing contractors to go to court to receive the full payment that they were owed. Businessman Trump celebrated his ability to negotiate good deals and get even better value as he routinely broke his commercial contracts under fig-leaf pretences. He then used his larger legal budget to force a settlement that gained even further financial benefit. There may have been a measurable boost to his bottom line, but most would not characterize this as a good business practice regardless of the financial rewards.

At least when Mr. Trump was in business, there was a choice as to whether to deal with him. But we can’t opt out of dealing with the U.S. president. Mr. Trump’s post-modern use of language, where words’ dictionary definitions evaporate, hurts everyone. It undermines the plausibility of any meaningful concept of truth that applies to all.

This should be especially troubling to those who hold some Christian conception of truth to be relevant in the public square. Christianity is a religion centered on “the Word made flesh,” but what we are witnessing is an erosion of the meaning and significance of words. To pretend that the ninth commandment isn’t relevant to the public square is to pull away a foundational building block of a society based on law, respect, and order. Like a Jenga game, the structure may hold while teetering for a bit but eventually it crashes.

Last week, President Trump embodied the fact that his words have no meaning; only his actions do. It is another step in his journey as a transformational force in American and global politics. He is redefining normal – in trade negotiations and international affairs. This too will filter down to all of our relationships in a way that undermines efforts to advance flourishing and truth. The new normal in Canadian politics might change the playbook in a good way but the broader implications of redefining “normal” in speech is eroding the wider landscape. As a result, speaking truth to our neighbours becomes less possible.

 The Captain and Compass Search 

The present uncertainty regarding Canadian domestic and trade affairs will not be resolved until after the federal election. Until then, this Insights section will provide a brief punditry take on “the week that was.”

The dominance of U.S. trade issues has forced the main federal Liberal leadership contenders to respond, issuing a joint statement supporting Canada’s retaliatory tariffs. Former banker Mark Carney’s climate plan will get more play in future days. Look for the Conservatives to rebrand his incentive program and border carbon tariffs as a carbon tax under a different name. Most of the remaining noise focused on interpreting polls that seem to be moving a bit. My expectation is that the Liberals (just as Democrat presidential candidate Kamala Harris did in the U.S.) will get a bit of a support bump from a new leader since Canadians will likely see any of them as preferable to Mr. Trudeau. Following that logic, I still expect that the federal election campaign will start before Parliament is scheduled to resume sitting on March 27. I suspect the Liberals will want to take advantage of any momentum and limit the time for the Conservatives, with their record-setting bank account, to flood the market with negative advertising aimed at defining their new leader. As always, this prognostication, along with four bucks, gets you a coffee at Starbucks. Let me also toss in former U.K. prime minister Harold Macmillan’s mantra that “events, dear boy, events” will almost certainly change things between the day the election is called and the minimum of 37 days of campaigning before voting day.

WHAT I’M READING

U.S. Take on Trump-onomics

I’ve been preoccupied with a Canadian lens on the tariff wars but I also came across a few articles that provide interesting American perspectives on all of this. In The Dispatch, the Manhattan Institute’s Brian Riedl argues that Donald Trump is more like Joe Biden than most acknowledge. The Council on Foreign Relations used nine charts to highlight the short-term pain and expected longer-term benefits that the tariffs might provide the U.S.

Advanced Thinking on Advance Directives

In a debate as polarized as euthanasia in Canada, I am especially encouraged when I see good arguments being made in places like Policy Options, where they are likely to be read by those not as committed to either side. McGill Professor Jonas-Sébastien Beaudry argued that an advanced directive is not the moral equivalent of a decision made in the moment and should not be incorporated into Canada’s euthanasia provisions.

Reintegrating Those Who’ve Finished Prison

Reintegrating those with a criminal record into the workforce rarely is headline news, but figuring out how to do it well has multiple benefits. It helps those released from prison stabilize their lives and hopefully serve society well. It also has significantly helpful economic and social consequences. This CBC story on a “Fair Chances Developer Toolkit” quotes my colleague Renze Nauta who has done some excellent work in this area. The “key to opening barriers isn't ignoring a person's criminal record, but giving employers a fuller picture of the candidate. That's why [Nauta] wants to see criminal records include positive aspects of a person's experience with the justice system,” writes reporter Ethan Lang.

MEANINGFUL METRICS

Perceptions and Reality

I reserve this space to share some data I learned in the past week. Plenty of candidates emerged during the Canada-United States trade storm. When I heard President Trump suggest that it was unfair that U.S. banks couldn’t operate in Canada, I knew something was amiss. However, I did not know that 16 U.S. banks operating in Canada comprise approximately half of the foreign banking assets, with about $113 billion in American holdings. The graph above, showing the gap between American perception and reality regarding their energy sources, does provide the context for the rhetoric that Americans don’t rely on Canadian energy. True, the U.S. exports much of its own energy since it’s cheaper to import Canadian energy. Even so, the perception gap underlines that Canadians have considerable work to do in getting their story told south of the border.

TAKE IT TO-GO

A Fang-tastic Story

This week, a reptile wrangler (a very different job than a Jeep wrangler) visited a home in the Sydney, Australia area to remove 102 venomous snakes. The homeowners called for help when they saw several snakes in a mulch pile. But when the wrangler showed up, he soon realized the problem was mulch bigger than first thought: the snakes were having babies and dozens were about to emerge from their eggs. He’d have to scale up his operation. Thankfully, the wrangler hatched a plan to capture all the red-bellied black snakes and then release them into the wild. Now that this is all hiss-tory, I’m sure the Australian couple feels the cost of the wrangler was money well serpent.

Next week is Family Day, and Insights will take the week off. Hoping to be back in your inbox on Saturday, February 22nd.