Canada Retaliates, Puts Tariffs on $107B of US Products | Hacker News Reader

Canada Retaliates, Puts Tariffs on $107B of US Products

bloomberg.com

92 pointstoomuchtodo68 comments

All those people who voted for Trump because they hated high prices and inflation are about to get a very harsh wake-up call.

Tarrifs if they were real would be anti inflationary, as they would discourage consumption.

no, it's the complete opposite. any increase in costs to society means wages have to go up to offset those costs which is what inflation is.

Inflation is caused by more money chasing after less stuff. If you keep the money supply constant, but reduce the amount of stuff you can buy with it, you will just as surely create inflation as printing money would.

Consumption isn't the only driver of inflation.

The excess private borrowing to pay tariffs or higher cost supply lines to keep business moving, especially where the govt is using the money to give tax breaks to people already well above the income/consumption curve, is going to drive a spike in inflation.

As we've seen with covid and post covid cycles companies will adjust margins and increase profits after these spikes rather than reduce costs further increasing the length and impacts of inflation spikes.

On top of that I expect more performative crap like checks sent out in Trump's name that aren't enough to actually help for more than a single grocery bill, but drive debt and inflation up further overall.

It'll be a fun ride.

So we essentially had free trade before? If tariffs were already pretty much 0%, how...

Yes. NAFTA. It’s what led to US-Canada-Mexico having a huge economic boom together.

We were the North American empire, but that is now internally crumbling.

I just hope the United States of America stay united and we don’t get Tariffs from California and Texas.

Actually, it was the USMCA, Trump signed that into law to replace NAFTA in 2019.

https://crsreports.congress.gov/product/pdf/IF/IF10997

Beijing Retaliates After Trump's Levies Hit China, Canada and Mexico - https://www.bloomberg.com/news/live-blog/2025-03-04/trump-ta... | https://archive.today/iXcYm

Mostly on agricultural goods:

https://www.reuters.com/world/china/china-vows-countermeasur...

China’s apparently the biggest importer of US agricultural products.

https://www.terrainag.com/insights/examining-the-economic-cr...

Ya, China imported around $40b of American agriculture a year. It turns out they like soybeans and chicken feet while we produce a lot and don't need as many ourselves. But they found an alternate supplier in Brazil the last time this happened, so I guess they will just double down on getting these things from other countries.

Okay, so the US government gouges its on people by charging them tariffs. And Canada retaliates by gouging its people.

It's like they believe Trump's theory of tariffs.

"We're going to make Americans pay to do business here! Yeah!"

Retaliatory tarrifs are something like MAD. Tarrifs are bad for both countries. Yes, Canada placing retaliatory tarrifs hurts Canadian consumers, but it also hurts American exporters. The alternative, doing nothing, would in some sense be preferable immediately, but in the long run would risk losing Canadian industry to the US.

But it can actually work the other way.

Tariffs in some ways coddle USA businesses in that they create incentives for Americans to prefer American goods. But USA businesses depend on foreign goods. Tariffs are a tax which increases their costs.

In the late 1800's, under McKinley, the USA tried to use tariffs to ruin Canada and annex it. One of the results was that some USA businesses moved to Canada to avoid tariffs on supplies they needed from Canada. That would have worked for businesses whose customers were not mainly in the USA, or that could expand beyond the USA.

Canada was working on increasing trade with other parts of the world, like Great Britain; businesses moving to Canada could have participated in that.

50% of Americans will find out if this is what they thought will "Make America Great Again".

Destroying our relationship with our neighbors and embracing Russia, Iran, and North Korea by assisting them in destroying Ukraine and the Western alliance.

At every step of this increasingly demented reality Ive thought, this is it, this has gone too far, surely nobody will accept this and most Americans shrugged. I hold no hope that anything can motivate the general public to pay attention.

The reason is: It doesn't affect their pocket books.

Meanwhile property prices and 401ks are up, old people (the largest cohort of voters) really just don't care.

I wish people had more empathy for others, but they don't. They mostly only care about taxes and their personal wealth.

This level of personal greed-individualism is partly what makes America great in the good times, but awful when things get bad.

Stocks are down over the last month. Depending on the risk profile of investors, many will find their 401k plans down soon as well.

> The reason is: It doesn't affect their pocket books.

I mean, a trade war absolutely will.

> Meanwhile property prices and 401ks are up

The S&P500 is down YTD.

That said, this will probably all take a while to sink in.

At least 30% of seniors in the US are living precariously and that is likely to increase as SSA benefits are gutted. The statistics are even worse when disaggregated by race, ethnicity, gender.

https://www.ncoa.org/article/get-the-facts-on-economic-secur...

As militant actions in Greece, France, and places across the globe attest, voting is not nor should be the only sphere of political engagement.

They'll be living in the Parable of the Sower type dystopia before they realise they should have done something years ago.

Parable of the sower:

https://en.wikipedia.org/wiki/Parable_of_the_Sower_(novel)

People always cite Parable of the Sower as proof of an inevitable dystopian collapse. They fail to then point out that Octavia Butler’s protagonists constructed Earthseed, a commune that stood in opposition to MAGA.

Ideally we'd get the Earthseed commune without the huge suffering that came before it!

I don't think the collapse is inevitable. I lean towards doomerism but I know I can't predict what's going to happen next week, let alone next decade.

The timescale of political events got somehow compressed: every day is a week, every week a month, every month a year.

It's really only been 6 weeks. People need to catch their breath. I'd anticipate a massive escalation in push back.

I wouldn't be surprised if it starts up pretty soon as the gigantic tax cuts were just made permanent - that likely means the folks with money have gotten everything they needed out of this administration.

"It's not the fall that kills you; it's the sudden stop at the end."

Less than 40%. (Plenty of people didn’t vote… They should have, but that doesn’t imply they wanted this.)

If you don't participate in the democratic process you don't have a right to complain when it affects you.

A democratic process being a one time thing every couple of years isn’t really democratic.

It isn’t a one time thing. Voting is the bare minimum and likely takes the least effort of all other types of civic engagement, perhaps only behind signing an online petition.

Parent is absolutely right. Representative democracy plus massive amounts of propaganda is what got us into this mess.

The peoples of the world deserve better, direct democracy.

But direct democracy doesn’t address the propaganda part of the issue

36% of eligible voters didn’t vote, so roughly half of 64% or 32% voted for this shitshow.

When you don't vote you accept responsibility for everything that happens next.

There is a significant fraction of the US population which was excluded from voting. Deliberately, as a partisan tactic. Sufficient likely to have changed the outcome.

"Voting Laws Roundup: September 2024"

<https://www.brennancenter.org/our-work/research-reports/voti...>

Overall 2024 turnout was below that of 2020, though that itself was the highest since 2004:

<https://ballotpedia.org/Election_results,_2024:_Analysis_of_...>

I'd clarify that those people have absolutely no responsibility for the administration and it's an absolute shame that any US citizen is denied the right to vote (including felons - yes even the really bad ones). Populations have a wide range of people in them - and if a society is so close to the razor's edge that it'd only survive in normalcy by excluding felons then it's already lost.

Regular folks who can't afford special IDs being denied from voting is just criminal in my eyes.

I agree that's a major problem - but I hope my original comment was worded clearly enough to be directed at those who had the opportunity and actively chose not to vote... if not, I hope this clears that up.

I understand and share that viewpoint, FWIW.

A key problem with that as a major argument is that 1) that group is unlikely to be persuaded regardless,[1] and 2) the disenfranchised population seems plausibly capable of having altered the outcome.

________________________________

Notes:

1. I'm increasingly of the view that political debate is far less about persuasion and far more about motivation and probably even moreso demotivation. At least in the present media landscape. The wrong side's been winning that war of late in the US. Though as many political commentators have noted, the theme in 2024 seems to have been less authoritarian advantage than incumbent disadvantage (see esp. Tory loss in UK). Even given that, a challenge is that authoritarian wins tend to be stickier (through promulgation of further anti-democratic voter exclusion, amongst other means) than nonauthoritarian wins. Reversing that trend will be a major challenge for the next few decades, should it even be possible.

U.S. tariff strategy:

1. Impose tariffs on countries that collectively purchase ~40% of U.S. goods exports

2. ???

3. Profit

It will be like Trump’s first term.

1. Tariffs

2. Negotiation

3. Better trade agreements

People are acting like this didn’t happened in his first term.

During his first term there were at least a few adults left in the room. This time around, all bets are off.

Back in 2016, "I will miss Pence as one of the few adults in the room" was definitely not in my bingo card. What a timeline we're in.

Never thought that McCain or Romney would seem as amazing alternatives compared to where we ended up either. Russian propaganda brainrot really did a number on the American populace over the last decade.

It was less Pence and more the old guard career folks like Tillerson - but now Trump just exists in an echo chamber.

There are no concrete asks from the US. The president appears to vehemently believe that tariffs will “generate revenue”. There is also the unhinged proposition to absorb Canada as the 51st state.

Also, siding with Russia in their apparent plan to invade Europe, and trying to annex Greenland.

Why should they continue to trade with us?

I hope you’re right. But even if that were the case, and trade agreements were better on paper, the net effect on the U.S. after all is said and done (damaged relationships, seeking out new markets etc.) is probably negative

Is 3 even true?

Trump said Canada is stealing from him by honouring a trade agreement that he negotiated.

America is a clown state.

You did not factor in the public opinion here. Already in Europe a mass wave of boycotting American products is shaping up. The same in Canada. It's different this time.

Trump said the trade agreement is terrible.

Except there is a truck sized hole of de minimus exceptions, so effective tariff rate is practically 0. but I guess it’s a good excuse for a market correction.

Would the idea not be to carefully select things that have viable alternatives after being diverted away from the U.S? Seems like instead have having a blanket export tax on our own people, it would make more sense to move money back into areas that'd see losses from a decline in U.S imports

Now he has exempted autos, so you can in fact drive a tariff free truck through the border as well.

LOL

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