How Canada could hit back to hurt the US economy – and Trump

Timing and Canadian political will could also be a tool for negotiations.

Canadians know they will feel economic pain in this dispute – financial analysts estimated the most recent tariffs of 50% on about $20bn of Canadian imports could trim between 0.3% to 0.6% off the country’s GDP in the short term.

Still, a majority in the country broadly back Ottawa’s decision to drive a hard bargain against the Trump administration, and other Canadian political leaders have shown a united front.

A weekend poll from Angus Reid indicated that some 76% of Canadians support Ottawa’s decision to walk away from trade negotiations even as they worry for their own job security.

The US midterm elections are fast approaching, with the economy front and centre for voters and the Republican hold on Congress looking tenuous.

Two of the biggest Senate races are in Michigan and Maine, which both border Canada and send most of their exports there.

The Yale Budget Lab calculates that under current law, Trump’s global tariffs will cost American households about $1,100 annually.

Any further increase in the costs of goods and the wider impact of the trade dispute on businesses could further sour the American public on the economy.

On Monday, Carney said that US workers will be hurt by Trump’s most recent threat to increase tariff on autos and auto parts from Canada to 50% after 1 January.

“What is the message sent out to the workers in Michigan, Ohio, Kentucky, Alabama? These workers depend absolutely on Canada, their largest consumer,” he said, adding that Canada buys more American cars than the EU and other countries.

On CNN on Monday, British Columbia Premier David Eby noted US consumers will see the impact of the US tariffs in any number of goods.

“If you’re building a new home, on plywood, if you’re replacing your floor, on veneers, if you’re getting married, on cut flowers, if you’re going out fishing, on fishing poles,” he said.

“It is a bizarre policy for Americans. It’s going to hurt them.”

Ford, one of the most vocal Canadian leaders opposing the Trump administration’s tariffs, also did not rule out specifically targeting Republican US states with retaliatory measures and “making sure America’s economy feels the pain”.

As for the coming midterms, Ford said: “If I were allowed to, I’d be down there door-knocking”.