The Hangover

(And not the Vegas one)

Well, that was fun.

Yesterday, after weeks of threats and extreme rhetoric, Donald Trump placed his trade war on “hold” for 30 days. Of course, his supporters continue to claim victory. It was nothing of the sort. Trump climbed down after securing agreements to do what was already agreed upon, with some window dressing to make it look new.

In Canada’s case, we committed to hiring a “fentanyl czar”—a laughably easy job considering the tiny amount of this odious drug crossing the border from Canada to the U.S.—tidying up some money laundering rules, and increasing border surveillance. That’s it. And the latter had already been agreed to with the Biden administration back in December. Of course, the usual suspects are already accusing the Canadian government of weakness, all while not really saying what they would have done differently.

This fiasco essentially confirmed my thesis: Trump was using tariffs and other economic pressure to attempt to force the annexation of Canada. The issues he cited to justify his threats were so transparently ridiculous that even The Wall Street Journal and Forbes published editorials criticizing them. Canada’s reaction likely caused his advisers to have second thoughts, and Trump himself was warning of “pain” to come on his personal Truth Social platform. Somewhere in the last 72 hours, someone convinced him that annexation wasn’t worth that pain—especially since the attempt was highly unlikely to succeed.

Here’s Trump talking about annexation before his calls to Trudeau yesterday. Pay particular attention to the latter part of the clip:

Trump Media Availability 3 Feb 25

There’s no doubt in my mind that Trump was told to back off—at least temporarily. It may not be coincidental that Rupert Murdoch, the oligarch behind Fox News and publisher of The Wall Street Journal, was in the Oval Office yesterday as well. Indeed, an enterprising reporter managed to ask Trump about the WSJ’s editorial regarding his tariff scheme while Murdoch was present. That can’t have been a comfortable moment for him.

So, the threat has receded for 30 days. It may not reappear—Trump has the attention span of a dog chasing squirrels, and by then, he may have invented a new issue with which to bully foreign countries (the bizarre Greenland episode seems to have left his mind). But I don’t think so. There will, of course, be new complaints—the G7 summit in June will be interesting. However, Trump is already threatening tariffs against the European Union and the United Kingdom and has found a new, entirely fabricated problem with which to beat Canada: access to our markets for American banks.

What this means for us is that we can only take Trump at his word: he means to break the Canadian economy to force annexation. That he’s been convinced this is a ridiculously stupid idea means little. All it will take is a word from a favourite media personality, and it will be game on again. I hope Canada has learned from this experience and doesn’t regress into complacency, assuming that everything is now fine. It isn’t—and won’t be—until Trump leaves office. We need to remain vigilant and start disentangling ourselves from the U.S., work that needs to begin now.