The Decibel Why the absence of a U.S. trade deal might be a good thing
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Aug 7, 2025 Tony Keller, a Globe columnist with deep expertise in trade relations, joins to discuss the stalled U.S.-Canada trade negotiations and rising tariffs. He dives into the implications of Trump's aggressive trade strategy and what it means for Canadian industries, especially steel and lumber. Keller unpacks the significance of Canada’s negotiation tactics and the potential benefits of avoiding a deal altogether. He also touches on the evolving context of international trade agreements amidst ongoing uncertainties.
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Current Tariffs Hurt Canada Moderately
- Canada's economy faces real but limited harm so far from tariffs, aided by USMCA protection.
- Damage could worsen if US disrupts USMCA or increases tariffs beyond current levels.
Other Countries Settled for Worse Deals
- US deals with Japan, EU, Korea are not full trade agreements, but accept 15% tariffs to avoid retaliation.
- Canada rightly refuses these deals, benefiting from USMCA protection for now.
Trump's Hardball Tactic Lowers Expectations
- Trump's negotiation tactic uses severe threats to reset expectations and make softer tariffs seem acceptable.
- The US's dominant size lets Trump impose tariffs others cannot threaten.