As Nafta negotiations continued through the spring, members of Team Canada felt they could see the terms of a deal coming into view. Trudeau offered to travel to Washington to negotiate directly with Trump, hoping to draw on the personal capital he’d tried to develop with the president, but he was rebuffed. Vice President Mike Pence delivered an ultimatum to the prime minister that any Nafta deal would have to include a sunset clause, meaning it would need to be renewed with American consent every five years, a poison pill seemingly designed to force manufacturers to invest in the United States because it created too much uncertainty for companies to spend billions in Canada when the deal could be ended at any time at the whim of the president. Trudeau did not travel to Washington.
On May 31, the Trump administration announced that the United States would impose steep tariffs on Canadian exports of aluminum and steel, even though the United States runs a trade surplus in the latter commodity. World Trade Organization rules allow nations leeway to override restrictions on tariffs when national security is at stake, and so that was the justification the administration used: that Canadian steel posed a threat to the national security of the United States; the same argument was applied to Mexico and Europe. The United States also announced that it had instigated an investigation into the national-security implications of the importation of cars and automobile parts, with the final decision lying in the thumbs-up-thumbs-down hands of the president, creating a much larger and far more dangerous threat to Canada, Mexico and the European Union.
“Everything will be a lot more expensive,” said Kristin Dziczek, a vice president of the Center for Automotive Research, an independent industry analysis group, anticipating how tariffs that hit multiple products will affect the market. “I don’t know how consumers can take a 25 percent tariff on vehicles and parts. Think about all the things people buy that have steel and aluminum in them. It’s cumulative. Working people who buy anything will be impacted.”
A few days after the tariff announcement broke, I met again with Freeland, this time at the Canadian Embassy on Pennsylvania Avenue in Washington, in a large sixth-floor room decorated with Inuit soapstone sculptures and iconic paintings of the northern wilderness. Freeland said she heard about the impending tariffs only the morning they were announced, while American officials waited for the president to reach his final conclusion. She said that Canada has learned not to be shocked by anything this administration does, but that this move was still astonishing. “It is an illegal act,” Freeland said. “That is extremely problematic between any two allies. What adds insult to injury is the national-security pretext, which is absurd and insulting.”
Trudeau immediately announced sweeping dollar-for-dollar tariffs not only on American steel and aluminum but also on specific products like bourbon from Kentucky (targeting the Senate majority leader, Mitch McConnell) and Wisconsin gherkins (the House speaker, Paul Ryan). “We were very prepared,” Freeland said. “Witness our list. We made a decision not to talk about what our appropriate response would be in detail ahead of time, partly to keep our powder dry and partly because we’ve felt that might increase tension unnecessarily at a time when we were trying to drive toward a deal.”
The paradox was that in feigning a national-security threat to the United States, Trump had created a real one for Canada. America didn’t grasp, or pretended not to grasp, the Canadian response. Secretary of Commerce Wilbur Ross said the economic impact was only a “blip.” Trump’s top economic adviser, Larry Kudlow, said Canada was “overreacting.” But for Canadians, the tariffs broke fundamental matters of trust, respect and the rule of law, and seemed to signal the beginning of the end; Nafta wouldn’t die in one day, it appeared, but in a series of humiliating and bewildering tweets and diktats that would ultimately harm millions of Canadian working families.
“It hurt our feelings, it’s very emotional,” Freeland said. “It’s not exclusive to our government. It’s a feeling that all Canadians have. I’ve had hundreds and hundreds of emails in the past week. The sentiment expressed is that they can’t believe the Americans are doing this to us.”