Mark Carney, leader of the Liberal Party of Canada, speaks after being named the winner at the Liberal leadership event in Ottawa on March 9.Justin Tang/The Canadian Press
The tariffs announced by U.S. President Donald Trump have upended decades of free trade in North America, causing chaos on both sides of the border.
The swinging pendulum of the president’s off-again, on-again threats has also stirred confusion. We asked Globe readers what questions they had about tariffs, and there were many centred around politics.
This Q+A is part of a series that tackles the varying impacts of the trade war.
- Canada-U.S. relations
- The impact on Canadian politics
- Canada's reaction to tariffs
Table of contents
Columnist Rob Carrick and Mariya Postelnyak also answered your personal finance questions, such as how tariffs could affect retirement savings, mortgages and interprovincial trade barriers.
And in another instalment, our business reporters parsed how tariffs could hit various sections of the economy and businesses, from autos to oil.
This Q+A has been edited for clarity and length.
Canada-U.S. relations
Is Trump preparing to invade Canada?
Washington correspondent Nathan VanderKlippe: Not in a military sense. But Mr. Trump has openly discussed using “economic force” to annex the country.
In one particularly revealing comment in early February, he described his thinking: ”If people wanted to play the game right, it would be 100 per cent certain that they’d become a state,” he said. “But a lot of people don’t like to play the game, because they don’t have a threshold of pain. And there would be some pain. But not a lot. The pain would be really theirs.”
It was a clear description of how the U.S. President sees a path to annexation: Strangle Canada economically until it folds. Yes, that might hurt the U.S., but not as much as it would hurt Canada. And in the end, a Canadian population in distress would capitulate.
Mr. Trump, in other words, has described laying economic siege to Canada.
There’s a reason former prime minister Justin Trudeau has been unusually blunt in describing the stakes. Earlier this month, Mr. Trudeau described his understanding of the President’s plan, calling it a plan to engineer “a total collapse of the Canadian economy because that will make it easier to annex us.”
According to Globe reporter Nathan VanderKlippe, U.S. President Donald Trump isn't planning to invade Canada in a military sense, but he has openly discussed using “economic force” to annex the country.John McDonnell/The Associated Press
Will the USMCA trade agreement be renegotiated in 2026?
VanderKlippe: Under the terms of the U.S.-Canada-Mexico Agreement, a joint review is scheduled for July 1, 2026. Negotiations will almost certainly begin before then. An executive order signed by Donald Trump on his first day in office launched a consultation process “in preparation” for that review. Importantly, it also includes an assessment of how North American free trade has affected “American workers, farmers, ranchers, service providers and other businesses,” with recommendations to follow “regarding the United States’ participation in the agreement.”
For the White House, the renegotiation of USMCA began the moment Mr. Trump returned to Oval Office.
Ontario Premier Doug Ford made a similar comment before he went to Washington for a meeting with U.S. Commerce Secretary Howard Lutnick, saying they would “discuss a renewed USMCA.”
In other words, the USMCA paperwork might say 2026. In reality, the negotiations have already begun.
Former ambassador to the U.S. Derek Burney suggested the best way to alleviate tariff uncertainty is to renegotiate USMCA before it expires. Does this not play right into America’s hands?
VanderKlippe: The return of Donald Trump has created an uncertainty for North American trade not known in decades. Tariffs imposed, then retracted. Threats made, then abandoned – and, occasionally, followed by new threats. Mr. Trump’s imposition of levies on Canadian goods has already, Ottawa has argued, violated USMCA.
It’s worth nothing that Mexican officials, too, have said they prefer to finish USMCA renegotiations this year, in hopes of buying some trade peace.
If that’s the case, what’s to lose from attempting to create a new deal that could, perhaps, be more durable? If nothing else, it may be a salve to our collective sanity.
The impact on Canadian politics
Will the Liberals use Trump’s tariffs as an excuse to cancel elections by invoking the Emergencies Act?
Senior parliamentary reporter Steven Chase: I do not see any evidence that the Liberal government will cancel a federal election by invoking the Emergencies Act. Our assumption is the Liberals want an election soon to take advantage of their rise in the polls.
What will the impact be during the transition of a new prime minister? How would that impact negotiations on tariffs and trade?
Chase: Cabinet minsters responsible for Canada-U.S. relations and tariffs will be required to continue to negotiate with the Trump administration where necessary. Those responsible for Canada-U.S. talks on trade remain largely the same from Justin Trudeau’s government, including Dominic LeBlanc, who is now International Trade Minister, and Mélanie Joly, who remains Foreign Affairs Minister, as well as Public Safety Minister David McGuinty. They will continue their work on Canada-U.S. trade relations despite the change in government.
The “caretaker convention” will apply during the election and could make negotiations a bit more complicated.
Here is how the Privy Council explains it: “Following the dissolution of Parliament for an election, however, there is no elected chamber to confer confidence on the government. Given this fact, and that the government cannot assume that it will command the confidence of the House after the election, it is incumbent upon a government to act with restraint during an election period. This is the ‘caretaker convention.‘”
However, the Privy Council also said that government activity following the dissolution of Parliament should be restricted to matters that are “routine or non-controversial,” urgent and in the public interest, able to be reversed by a new government, or agreed to by opposition parties.
Cabinet minsters responsible for Canada-U.S. relations and tariffs will be required to continue to negotiate with the Trump administration where necessary.
How Canada is reacting to tariffs
Doug Ford said we have numerous trade agreements with other countries. So, what is being done right now to expand trading with them?
VanderKlippe: Many of the decisions related to Canadian trade will be made by private interests, not governments.
But there are clear signs that Ottawa is looking to bolster ties with Europe. Mark Carney visited Britain and France as one of his first official acts as Prime Minister.
At the same time, provincial governments across the country have pledged to either ban future contracts with U.S. companies – or rip up existing deals. Last week, for example, Nova Scotia Premier Tim Houston said he would cancel one planned contract. Ontario Premier Doug Ford has banned all U.S. firms from provincial procurement. He and other premiers have removed U.S. liquor from provincial shelves, too. With U.S. suppliers out, there is room for others to move in.
A half-empty shelf of American whiskey is pictured at the 100 Queen’s Quay East LCBO in Toronto on March 4.Laura Proctor/The Canadian Press
Can the LCBO return the U.S. products back to the manufacturer and get a refund, or have we already paid for it and are stuck with it?
Queen’s Park reporter Jeff Gray: The short answer is that no, the Liquor Control Board of Ontario is not sending back the California wine, Kentucky bourbon and other U.S. booze it has yanked off its shelves to its suppliers for refunds.
In a statement on Wednesday, the provincial agency confirmed that all of the U.S. products removed from its shelves are in storage “until further notice.” All products sold online or in stores have already been purchased by the LCBO, the agency said.
Ontario Premier Doug Ford, who ordered the U.S. booze ban earlier this month, has also said the alcohol would be stored and resold once the tariff threat is lifted.
The LCBO sells just under $1-billion worth of U.S.-made booze a year
If tariffs are paid by the American consumer, what value are reciprocal tariffs?
VanderKlippe: Tariffs affect commerce and they affect consumers. You’re right that reciprocal actions by Canadian governments will hurt consumers. If you live in Canada and you’re a fan of Kentucky bourbon, you’re already hurting.
But tariffs also affect businesses that trade goods. If Washington imposes tariffs but Ottawa does not, U.S. businesses will enjoy new protections at home while continuing to enjoy easy access to Canadian markets. Tariffs are meant to ensure the pressure on U.S. businesses – and governments – is in some ways equal to the pressure on the Canadian side.
That said, to respond is a choice. Canada and the European Union were quick with countermeasures. Other countries, including Australia and Britain, have yet to push through reciprocal tariffs.
What penalties would Canada have to pay to cancel the F-35 plane deal?
VanderKlippe: It’s unclear and the government has so far declined to answer the question. But Canada is only obligated to buy 16 F-35s under its current agreement with Lockheed Martin. The government announced this recently.