HALIFAX—Everyone knows, or ought to know by now, that United States President Donald Trump wants to be king. But do Canadians want to be his subjects?

The answer to that is a hearty “hell no.” Every poll shows an overwhelming number of Canadians want no part of becoming America’s 51st state. This year’s Canada Day celebrations showed a greater-than-usual public love of country, and an appreciation of what it means to be Canadian. There is a simple reason for that outpouring.

Canadians want no part of a kingdom run by a convicted felon who likes to pardon criminals and wants to expand American territory. Panama Canal, Greenland, Canada—take your pick. 

A king with a heartless deportation program that lands people without criminal records in prison camps like the newly opened “Alligator Alcatraz” in the Florida Everglades. Trump’s joke about it? “We’ll teach them how to run from alligators.”

A king who recently called for the cancellation of the corruption trial of Israeli Prime Minister Benjamin Netanyahu, Trump’s buddy who runs the most far-right government Israel has ever seen. Never mind the Israeli justice system.

The aversion to Trump’s suggestions regarding Canada was so intense that it changed the ballot question in this country’s recent federal election. 

It was no longer about the price of eggs, but the price of sovereignty. And that meant focusing on a single issue: who was the best person to deal with the very real threat to Canada posed by Trump?

Despite years of double-digit leads in the polls by the Conservative Party, the country chose Mark Carney and the Liberals for the job. Carney is a former central banker who is deeply experienced in finance, and a man of the world, as compared to Conservative Leader Poilievre, a lifetime politician with no private sector experience. 

On the campaign trail, Carney promised an “elbows up” approach to Trump, and a stout defence of Canadian interests. 

Carney also made some profound pronouncements. He said that the “special relationship” with the U.S. was “over.” He warned that tough times could be coming, as Canada transitioned into a new world of trade and alliances. But he assured the country that we could give ourselves more than the U.S. could ever take away.

Carney’s handling of the U.S. president in early meetings more than met the standard of his election promises. He was firm yet civil with Trump, and certainly not obsequious. Trump never called him “Governor Carney,” the demeaning phrase he hung on former prime minister Justin Trudeau. Perhaps the most telling shift, Trump softened his 51st-state musings. 

All of this makes the latest twist in the trade negotiations between Canada and the U.S. so mystifying.

At the demand of the U.S. president, Prime Minister Carney rescinded a multi-billion-dollar digital services tax (DST) on the big U.S. tech companies operating in Canada. The DST had applied to Apple, Google, Amazon, and Meta. The last federal budget projected that the DST would bring in nearly $6-billion over the next five years. 

The thinking behind the DST was solid. It was aimed at preventing these American tech giants from generating profits in Canada and not paying taxes on them. Several European countries also have DST legislation, which is sometimes referred to across the pond as the “Amazon tax.” 

Trump called Canada’s DST a “blatant attack” on great American companies, and claimed the European version of the tax was an “overseas extortion.” And to show that he meant it, Trump gave Carney an ultimatum. He cancelled all trade negotiations between the two countries until Canada got rid of the DST.

When Carney informed the president that the tax had been rescinded, the White House gloated. It boasted that Carney had “caved.” Karoline Leavitt, Trump’s press secretary, piled on with her own observation. “President Trump knows how to negotiate. … Every country on the planet needs to have a good relationship with the United States.” 

No, Trump knows how to intimidate. 

Poilievre was quick to pounce on Carney’s “elbows down” dumping of the DST. He said that Carney should have gotten something for rescinding the tax, such as the U.S. dropping tariffs on Canadian softwood lumber. That is not an unreasonable expectation. 

Carney obviously concluded that he did get something for dumping the DST in the reopening of vital trade talks with the U.S. 

After all, Trump’s ruinous tariffs are still on the books. As long as those tariffs are applied against our auto, steel, and aluminum industries, the Canadian economy is at grave risk. 

So, in the national interest, Carney simply made a sacrifice that had to be made in hopes that an all-encompassing trade deal with a vital trading partner can be reached. 

It is a plausible claim to say that Carney didn’t cave, but merely adjusted to real politik. But plausibility is often the way to hell in politics. It is too often a retreat from principle, rather than an adjustment to reality. And Carney’s decision is a case in point.

The first question about this regrettable decision is why the DST did not remain just another one of the contentious issues that should have been part of the trade negotiations? 

Given the U.S. aversion to the tax, surely that could have been a bargaining chip in the talks. Why would Carney give up something that could have been used for getting something in return, such as relief from some of those ruinous tariffs?

But here is the bull’s-eye on the political dart board: Trump has learned the lesson, as trumpeted by his White House, that he brought Canada to its knees with the threat of cancelling the trade talks. 

Why does this matter?

It matters because a dreadful precedent has been set by Canadian negotiators. Since Trump has gotten his way on the DST, which is a matter of Canadian sovereignty, why wouldn’t he invoke the same threats the next time he can’t get his way in talks? 

Let me give an example. Trump hates Canada’s supply-management policies. He hates the fact that on agricultural products, America faces daunting tariffs in this country. What if he next says either you drop supply management as a policy of your country, or the trade talks end? Would Carney “cave” again for pragmatic reasons?

Though Carney, with all of the impossible cards he has been dealt, would do well to take those words to heart. Easier said than done.

Michael Harris is an award-winning author and journalist.

The Hill Times

 

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