From WXXI news.

This is connections.

I'm Evan Dawson.

Well, our connection this hour was made over this past frenetic weekend when President Trump launched a trade war against the United States North American neighbors.

The president imposed new tariffs or said they were going to roll out on Tuesday 25%, a level that had an immediate impact on business and relationships.

President Trump has said that the tariffs are necessary for several reasons.

First, he says that the United States has been running a trade deficit for too long with our neighbors.

That's why he included China in the new tariffs, although at a lower level.

The second reason is that Trump says the United States has been victimized by porous borders to the south and north, with drugs and undocumented immigrants flowing in.

Canadian leaders responded that if there's anything flowing a dangerous levels, it's American guns heading north.

On Truth Social, Trump wrote that Canada will lose this trade war, and their best move would be to agree to become the 51st American state, which would eliminate the need for tariffs.

Here's some of what President Trump said to reporters this weekend.

Canada has been very abusive of the United States for many years.

they don't allow our backs.

You know that Canada does not allow banks to go in.

If you think about it, that's pretty amazing.

We have a U.S. bank.

They don't allow them to go in.

Canada has been very tough on oil, on energy.

They don't allow our farm products in essentially, they don't allow a lot of things in.

And we allow everything to come in.

It's been a one way street.

We subsidize Canada by the tune of about $200 billion a year.

And for what?

What do we get out of it?

We don't get anything out of it.

We don't get anything out of it, he said.

Well, for Canada, it's been a rare moment of political unity, with outgoing Prime Minister Justin Trudeau offering a solemn but firm statement of Canada's plan to retaliate.

Followed by similar comments from conservative Canadian leader and possible next Prime Minister Pierre Poilievre.

Here's part of what Trudeau said this weekend.

I want to speak directly to Americans, our closest friends and neighbors.

This is a choice that, yes, will harm Canadians.

But beyond that, it will have real consequences for you.

The American people, as I have consistently said, tariffs again against Canada will put your jobs at risk, potentially shutting down American auto assembly plants and other manufacturing facilities.

That's Prime Minister Trudeau, who also said that there there tariffs will include 25% across several hundreds of billions of dollars in American goods.

And we're going to talk about that coming up about the possible impact.

Now, I want to listen to some of what the conservative leader in Canada, Pierre Poilievre, said yesterday.

Conservatives condemn President Trump's massive, unjust and unjustified tariffs, which will damage both American and Canadian economies.

There is no justification whatsoever for these tariffs or this treatment.

Canada will never be the 51st state.

We are an independent, proud and strong nation.

And in hockey games in Canada over the weekend, the American national anthem was raucously booed.

Meanwhile, the leadership in Mexico announced their own plan to retaliate with economic sanctions against the United States.

But then just a couple of hours ago, with the Dow Jones Industrial Average down about 500 points.

President Trump called Claudia Sheinbaum the leader of Mexico, and the leaders agreed to pause the new tariffs by about a month.

That seemed to stabilize the stock market.

Trump says that Mexico is now promising to send 10,000 troops to help police the border with the United States.

That is something that Mexico also did back in 2021, and it did not have a dramatic effect on border crossings.

But Trump says this is a victory in his trade war on day one.

Meanwhile, stock markets in Asia and Europe fell on fears of a prolonged trade war and a business slowdown.

President Trump has said there could be some short term economic pain, but he thinks Americans will understand the need for it in the long run.

He reaffirmed his intention to pursue taking over Greenland as well.

And today, Secretary of State Marco Rubio.

Rubio is in Panama with eyes on the canal.

Well, the speed of all of this escalation has surprised many people, especially in Canada.

We're going to talk about that this hour with our guests.

In studio with me is Doctor Ahmed Barnaby Al, who is a distinguished professor, and the Arthur J. Gosnell Professor of Economics at RIT.

Welcome back to the program.

Thank you for being with us here.

Thank you for having me on the line.

Let me welcome two guests from Canada.

Doctor Mario Elia is a family physician based in London, Ontario, and an adjunct professor in the Department of Family Medicine at Western University.

Doctor Elia, welcome back to the program.

Great to be here.

And welcome to doctor Norm Friesen.

Norm is a professor of education living in Canada.

Norm, thank you for making time for us.

Oh, you're most welcome.

I'm just going to start with the Canadian guest and just ask you.

It's sort of the last 24 hours has been like.

And I, you know, Doctor Elia, I know you are a big hockey fan.

I saw lots of video of national anthems, and it was, it's been an ugly sort of weekend, for the American national anthem in Canada.

But is that representative of what you are hearing and feeling, or is that overblown?

No, I it's it's always interesting.

You always wonder whether what we are seeing on social media is actually a reflection of what's happening, kind of beyond social media in society.

And I think what what you heard in those arenas over the weekend is a pretty accurate reflection of how Canadians are feeling.

And, to hear the anthem booed.

I don't recall that ever happening even at, you know, international events, World Junior Hockey Championship.

you know, despite there being a kind of a fierce rivalry between between the two, the two nations.

All right, booing, is something you won't often hear.

And as loud as it was in Ottawa, I'm not sure if anyone saw the game.

The the Raptors anthem from last night.

more booing.

So I think it's we can talk about it after reflection of how Canadians are feeling for sure.

Well, and Mario, I'm also, curious to know about sort of this political moment because, you know, Americans aren't following Canadian politics closely.

They might be vaguely aware that Prime Minister Trudeau is planning to step down.

His popularity ratings have fallen.

and Pierre Poilievre, who is a possible successor, doesn't have much nice to say about Justin Trudeau, but their statements were pretty similar.

It looks like there is some alignment here.

Has this galvanized Canadians across political boundaries?

I think absolutely it has.

Over the last, you know, number of months, even past couple of years, there's there's kind of been a question as to, you know, is there some sense of disunity within Canada?

a lot of that brought on by, by, by Covid restrictions, a lot of brought on by, by kind of our national politics and there has been kind of an underlying question of, you know, if it is that idea of being Canadian that, you know, kind of being being, you know, at risk, for lack of a better term and, and issues around immigration and issues around, you know, our criminal justice system here in Canada.

and seemingly over the course of 40 to 72 hours here, I have not seen this element of patriotism in my lifetime.

and even talking to, to, you know, older and older patients of mine, even this morning we had a few conversations.

I haven't seen anything like this since, you know, since Canada played Russia in the 1972 Summit Series.

In terms of people being fiercely proud of their country, fiercely ready to defend, do whatever is possible.

this morning, I already saw, little flags at the grocery store, advertising Canadian products.

so this this is this this is all people are talking about for, like, you know.

Yeah, like a better term affair.

because, you know, the idea of having your sovereignty as a nation in question, the idea of of of knowing that our economy will suffer as a result of these and, friends and family will lose their jobs, potentially, depending on their under sector.

Patients of mine are going to be in financial straits, potentially.

this is this has everyone's attention and everyone's fury.

And, President Trump wasn't entirely a, you know, a popular individual up in Canada approval rating, I think was 20% positive when I was back in January.

Can't imagine that's improved much.

but it's, it's kind of it's uniform up here.

And even those, those who may have supported Trump there, Acadians who, who had favorable views towards Trump previously, they certainly aren't advertising those those positive news today.

Professor Friesen, does this mean that Canada is not going to agree to become the 51st state after all?

yeah.

Well, I just want to start by, saying that I acknowledge that I'm speaking to you from the unseated traditional lands, multiple First Nations here in British Columbia, including the Musqueam and so Salish nations, nations.

And so I just want to insert into this discussion the idea that, that our, the question of sovereignty of Canada is actually fairly complicated and that there's a couple of different, a number of different nations in Canada in the sense.

including Quebec as a just distinct society with their own National Assembly and of course, many First Nations.

So it's not even up to necessarily me or other, other people that my friends, for example, to, to say it's up to it's up to like a wide range of different interest groups and, stakeholders who are, in a sense, members of southern Canada.

And, Norm, just briefly, do you want to elaborate on some of the points that Mario has made about what the kind of this cultural moment is like in Canada?

yeah, I think I mean, I once, once attempted to give different comparison to I think maybe one comparison could be to the, 1995 referendum that almost saw Quebec, cede from Canada.

And, I think one of the things that that happened there was, was both, you know, sort of corporate Canada and, English speaking Canada, all being on exactly the same page and, and very adamant about the need for national unity.

in some ways, what's happening now, though, is, of course, we've provided you've been provided with motivation by our, southern neighbor.

So I think in some ways you could say that it's a it does have a positive side, insofar as unity has been something that's been lacking in Canada for the last, time since Covid, at least.

Yeah.

It's interesting to see that.

and, well, let me turn to the economic side of this and doctor about it.

But when we look at tariffs in general, first of all, one of the questions I had for the professor for the program was is there a case for tariffs?

And the answer that you gave was yes.

But maybe now not this.

I'm going to give you some space.

Talk about what you're seeing here and what tariffs are typically used to do.

Yeah.

So the economic theory is pretty clear.

And and it distinguishes between small countries and large countries.

So small countries one that cannot influence world prices with its own actions.

So for a small country there is never a case for a tariff.

So the U.S. is not a small country.

It's a large country.

So it has market power in some market.

So the question is, for a large country like the US, is that a case that one could make for a so-called tariff?

And the answer is again, yes, a so-called optimal tariff, but in a very narrow range of circumstances.

And typically excluded from this analysis is the question of retaliation.

What do you do when the trade partner or partners against whom you're living?

Tariffs retaliate with their own tariffs?

Then it's basically a free for all.

The only thing that I will say is that because President Trump is inheriting a relatively strong American economy, particularly relative to many other parts of the world, it is possible that with tariffs and if a tariff war ensues for a reasonably prolonged period of time, that the United States will lose, as will its trading partners, but that the U.S. will lose by less.

That's that a win?

Is that a no?

Absolutely not.

That's not a win.

No, that's well, from President Trump's perspective, it's probably a win.

But now you're both losing.

Okay.

And you heard in the remarks that I played we played at the outset of this program.

The president said to reporters, you know, we subsidize Canada, and what do we get for it?

We don't get anything out of that relationship with them.

What do we get for it?

What do you make of that?

That's a bogus argument.

I mean, we don't subsidize Canada and we get a lot from Canada.

Let's just focus on one thing that's energy.

Midwestern states, several of them so-called swing states, which he won in the most recent election.

Many of those Midwestern state folks there get their energy from Canadian sources.

Now, Canadian energy coming into the United States is going to be, the tariff is going to be levied on it, granted, not 25%, but 10%.

But that's still going to hurt.

We've been getting energy from Canada as at a discount.

Yeah, not and perhaps not anymore.

No, no it's going to be it's going to cost more.

But the only silver lining, to the extent one can refer to this as a silver lining, is that the tariff is going to be 10% on energy imports, as opposed to 25%, but it really doesn't make any sense.

yeah.

I want to listen to a couple of things and get the professor's take, and then we're going to open it up.

Listeners, if you want to join the conversation about this.

You know, you heard Doctor Elias in in Ontario.

It's all anybody's talking about.

Americans are talking about this, too.

This has been this is really shaking people up, in the last 48 hours here.

first, I want to listen to some remarks that were made last week before this really erupted into an actual tariff war from another conservative leader in Canada, the former prime minister Stephen Harper, who was speaking on a program.

And he was talking about what Doctor Bot, a biologist, talked about energy, the flow of energy.

he's concerned.

Harper was concerned that Trump was ignoring the fact that a lot of American guns end up going over the border into Canada.

He said that in terms of the actual flow of migration and drugs, it is a minuscule percentage that goes into the United States from Canada, essentially.

Harper saying Trump is very badly informed here, and Harper, someone who, you know, I mean, I don't know if he's predisposed to be close with Trump, but he's certainly closer politically to Trump than the current leadership.

I want to listen to some of what Harper said.

Many things he's saying, even when you talk about migrants, first of all, there's no major migrant flow from Canada.

The United States.

There's.

And I'm going to tell you right now, drugs, guns, crime, most of those things flow north, not south.

A lot more flows into Canada from the United States that flows out of it.

So like, I have a real problem with some of the things Donald Trump is saying.

It doesn't sound to me like the pronouncements of somebody, you know, Isaac wants a better deal or whatever.

Fine.

But does it sound to me like the pronouncements of somebody who's a friend, a partner and an ally?

All right, that's Stephen Harper, the former prime minister.

What do you make of that?

Olmert?

I think he's generally on target.

This is not the way in which you behave.

This is not the way in which you treat your allies.

In fact, some of your closest allies remember Canada as a member of the so-called Five Eyes security alliance.

If his concern is about national security.

You're just, you know, unnecessarily irritating and even insulting one of your closest allies.

I don't see how that makes any sense.

when it comes to what is happening in the last couple of hours with Mexico, I mentioned that the, the Mexican leadership had a call with President Trump this morning.

President Trump said it was a very friendly call.

And and the white House agreed that the Mexican tariffs are going to be delayed a month.

Now, with Canada, he said there's no deal to delay.

There's another call with Prime Minister Trudeau this afternoon.

but there's less of an indication there could be a delay with Mexico.

You get this month long delay.

And, President Claudia Sheinbaum of Mexico says, okay, we'll put 10,000 troops at the border, which Mexico did four years ago.

That's not, you know, a brand new move.

But they're saying we're going to do that.

And now the white House is saying, look, we've already got our first victory in the trade war here.

It's day one.

We're going to pause it with Mexico, and they're going to add troops, and we're going to make the border safer.

Look at what our tariffs are doing, professor.

They're winning.

What do you say.

Well I say that's, comparing and mixing apples with oranges.

There is a security issue of the southern border.

That's that's clearly everyone's acknowledged.

Yes.

And there have been significant attempts to address it.

But the way in which you address it is not by slapping tariffs, which hurts ultimately American consumers and the troop surge that you're talking about, as you just pointed out, a similar surge did occur a couple of years ago.

To the best of my knowledge, it didn't have much of an impact in terms of reducing flows across the border.

And yeah, I mean, I'm not an expert on that.

I don't know that it had I mean, certainly we're not sitting here four years later talking about a closed or secured border.

So, and I can't predict what's going to happen at the southern border.

Again, that's not my expertise.

we'll have to see what this new Mexican troop surge will do there.

But, Doctor Barnaby, all the president had said throughout this campaign, and frankly, he said eight years ago he doesn't like the way our trade is working out with China, with Mexico, with other countries.

And he has been talking about tariffs for a long time.

This is the culmination of something that he has sort of telegraphed for a long time.

Is there a case that we need to be tougher on Mexico?

Well, we need to be tougher on Mexico, not for trade related reasons.

We need to be tougher on Mexico as a security concern, of which illegal immigration is a part.

There is no question that that problem, illegal immigration, needs to be dealt with.

China is a completely different kettle of fish.

They are a major problem, there's no question about that.

And dealing with China requires a comprehensive multilateral approach, including the help of allies, which is exactly what he's not doing by, levying tariffs on Canada in this particular case.

And we need Canadian help along with the help of our EU partners.

one other point I'm trying to before I turn back to our guests who are joining us from Canada this hour, and listeners will take some more of your feedback as well.

At 844295 talk, it's 844295825526368.

If you call from Rochester 2639994 or email the program connections at I talk.

At the outset you said if you're a small fish in the sea, there's not really a case for tariffs, correct?

China is the the biggest fish.

I mean, I don't there's big fish and there's China.

I want to believe as an American citizen that this administration is very well thought out how they're going to approach China, because China has a lot of economic power, too.

They have different levers they can pull.

Correct.

But they have a trade imbalance that they benefit from.

And I think the Trump administration would say, look, we're going to hit them where it hurts because they want our business.

They're benefiting from a disproportionate set of business, and we have the leverage here.

Is that true?

It is true that we have leverage, but then so do they.

And the question is, it's unclear what would happen if there were a tit for tat tariff war between the United States and China, particularly if it were up for a prolonged period of time.

The the sad fact is, because of a certain, amount of historical events in which we've played a major role in enabling China's rise, we have to recognize today that it's the second largest economy of the world by some, counts, maybe even the largest.

And you cannot just bully them into submission if you really want to address the problem that China has with the United States and more generally with the Western world.

You need a coordinated, multilateral approach.

You can't just do it unilaterally.

this morning, I had a chance to have a brief phone conversation with someone from the Finger Lakes wine industry who had a contract canceled, essentially overnight.

And he's not alone.

So I want to listen to some of the comments that were made in this conversation by Chad Hendrickson.

Chad is the brand ambassador for Lakewood Vineyards.

That's on Seneca Lake.

And what you're going to hear from Chad is a rapidly changing scene for the for American producers, especially here in our region, New York wine and spirits.

it is rapidly changing, literally overnight.

There are stores.

Your doctor lives say that there's Canadian flags and Canadian products in the grocery store, and there's an emphasis in liquor stores on, you know, by Canadian.

But we're actually seeing contracts cancel overnight.

This and some of my conversation with Chad Hendrickson from Lakewood.

Thanks for having me.

So let me just start by asking you this, Chad, what has been the immediate impact of this news over the weekend on your company, your business?

Well, I mean, Lakewood recently agreed to join the export program that facilitated through the New York Wine and Grape Foundation, supported by the USDA, to get our wines abroad and also get our wine into Canada.

And, you know, a 25% tariff make this essentially a nonstarter.

We're looking forward to a nice addition to our sales going into Canada.

We have a ton of Canadian guests that come down and buy wines in-house.

And, they have them, you know, local for them was was it was a big boon for us.

And that's essentially what this deal that you're talking about that's gone.

You finished the deal just a few months ago.

Is that right?

Just a few weeks ago.

Just a few weeks ago.

Yeah.

And so is it your understanding that overnight it's canceled?

Yeah.

I, just got a a text from a friend that's in the industry as well that Doug Ford essentially said that the the Liquor Control Board for Ontario was removing all American alcoholic products from their shelves.

So there is no deal.

Now we are done.

And, you know, it's going to affect all the Finger Lakes producers that are in Canada.

But really all alcohol producers across the United States.

It's a it's a real big deal.

I think that we see challenges in this industry all the time.

alcohol sales have been down.

Wine sales specifically have been down in the United States.

So, you know, any opportunity for us to to grow as a company but grow as a region as well is important to us.

Moreover, we've always had a very friendly relationship with our our neighbors to the North here in the Finger Lakes.

We're always excited to see them here.

It's frustrating, to be quite frank.

We would like to see that relationship grow and not not be damaged.

And I'm not really sure how we're going to recover from this.

You talked about the region wide and frankly, the nationwide impact of this set of tariffs.

And I think that's well taken.

But for Lakewood individually, how significant a loss is this?

I can't really say because we're not at the point of having a broad distribution.

Right.

But the potential was there and and lost potential to me is the loss sale.

You know, we could have probably ran through 120 cases of wine, hopefully immediately and seen our sales grow from there.

That's speculation.

The reality is there are other wineries that have placement now on shelf, and that's a huge blow to them.

So I do talk regionally because that's something that that I think that we Finger Lakes producers do often, and we're proud to do that.

But individually it's going to be a you know, any loss is a blow.

That's Chad Hendrickson from Lakewood Vineyards on Seneca Lake.

Joining us this morning to tell us about how quickly things are moving.

And Doctor Pill, also what that says to me is there's a lot of talk about economic theory.

And then there's reality.

And reality is moving pretty quick here.

Any surprise there?

No, I mean, I think, the Canadian Prime Minister, Justin Trudeau, was is justified in feeling peeved because just a couple of weeks ago, he made a trip to Mar a Lago to have a conversation with President Trump.

And I think as a result of that conversation, he probably felt okay.

I've dealt with the worst of things, and we now have an understanding, at least an implicit one, that nothing draconian is going to be done with the Canadian economy.

And then fast forward just a couple of weeks, and here, as Trump put 25% tariffs on one of our closest allies.

So he must be legit.

Really upset that I thought I had some implicit agreements with the new American president.

But now reality's a little different and things are moving very quickly.

But he was prepared to to retaliate.

Yes.

He was very specific.

Yes.

We shouldn't be surprised about that.

No.

No.

Why?

We should not be surprised at all.

I mean, why would any self-respecting country, particularly an ally of ours, our neighbor, in fact, do nothing and just sit there saying, okay, you know, walk over a doormat?

Yeah, exactly.

Walk all over me with a doormat.

It's not going to happen.

So he's retaliating.

And if the only thing is we don't know how long this is going to last, because, you know, Trump may do something and then claim victory even if he's accomplished nothing but if it's prolonged, then there are going to be major damaging impacts on consumers, amongst other groups on both sides of the 49th parallel to our Canadian guest here, doctor Mario Elia.

Is there support, as far as you can tell?

Is there a feeling that, hey, this is going to be painful?

But what Prime Minister Trudeau said about the retaliatory retaliatory tariffs, that that has to happen, that you can't take this lying down and that Canada is going to try to punch back, even if it hurts.

I think so, and I think there's a large support for that.

Right.

your guest earlier had mentioned the, the move that Doug Ford, premier of Ontario, made in terms of, so our, our, our liquor here in the province of Ontario, goes through the liquor control board.

so, over the weekend, he made an announcement that as of tomorrow, all, all American alcohol, would be essentially banned from from the liquor.

So they wouldn't be, purchasing any American alcohol, through the Lcbo.

That's essentially all of the alcohol that flows through Ontario.

Just, you know, complete stop.

and I'll, I'll admit, when I saw that tweet, I gave a bit of a fist pump because, it that that, to me seems like a logical step that we need to take.

Hearing, hearing, you know, that conversation and and knowing that it's going to have a negative effect on someone's livelihood in the US is not, you know, that that's really hard to hear that the, the the needless negative impact that these that this, this entire situation is going to have on some Americans.

but we don't have, you know, we don't have many cards to play here.

You know, we're we're dealing with the kind of largest economy in the world, an individual making the decisions for whom we can't necessarily, trust day to day or is going to be consistent logically or or otherwise, and not knowing how to necessarily pull those levers and, and again, alcohol is one where can provincially run that's one that where, you can make an impact.

There were another announcement today from, from Doug Ford that any, any contracts that are that the province of Ontario, is, is, putting out to tender, that American companies would not be allowed to drive for those and those contracts yearly are in the billions.

and announcing that his that the the the province's contract with Starlink interestingly here's here's another yeah.

You know we saw that this morning.

that he was ripping up the contract and stomach.

Now, what does ripping up mean?

I have no idea.

We we have a habit in the province literally ripping up contracts and still needing to pay them out.

so I'm not sure that that, that will have an impact, in the president's president's inner circle.

but again, is there support for these things?

I think, by and large, yes.

politically, it's it's a very interesting time.

Canada.

We're, you know, in the province of Ontario, here we are now in the midst of what will be a month, month and a half long, election campaign.

so you've got you've got parties that are now, you know, as much as I would love health care and, and kind of other social issues to be on, on the, the top of mind when it comes to, our, our election campaign.

No one cares about health care right now.

this is strictly, a campaign being being, being fought on the economy and again on on the federal level, we we're we're going in the direction of an, a massive, election win for the federal conservatives whenever the next election will be on.

Yeah, on a federal level, seemingly over the last two weeks that has flipped on its.

I did not see that happening through any through any mechanism.

this seemed like a done deal.

but suddenly the the incumbent Liberal Party now is, is making some inroads in Ontario.

So there's all of that playing in the background to where you have no politicians here who are going to take a nationalistic stance, who are not going to necessarily, you know, want to give in and be seen is given in.

There is an opportunity here for them as well.

so a lot of kind of interesting dynamics, here if I.

Norm, Professor Friedson, what do you think?

What do you want Canada do about this?

I mean, are you in support of what Prime Minister Trudeau and his team have done in terms of retaliation?

Oh, yeah.

Personally, I'm in support.

I think a lot of a lot of people are supportive.

and, I mean, one of the things that I just wanted to mention that make this particularly frustrating for Canadians, I think really, motivates them not to support, what I was doing is just the fact that Trump has mentioned any number of reasons for these tariffs and, for his initial tariffs and, you know, important border crossings, fentanyl, which is minor, as Harper said, and, now he's talking about banking and the system not being, banks not being permitted, to operate in Canada.

We U.S. banks, that is.

And so I think that this, this just, increases people's frustration here.

And, and I do think, in a way brings together against a common enemy, well, as we take our only break the hour, Francois writes in to say Francois was a dual citizen says the damage is already done, even if tariffs are not implemented.

Canadians are already changing behavior and finding alternatives to American products, which will increase the trade deficit.

It takes time to build trust, but no time to destroy trust.

It has just been destroyed.

Oh, a lot happening on this Monday.

Let's take this only break of the hour, and we'll come back with more of your feedback as we talk about this tariff war on connections.

Coming up in our second hour, our colleagues from Citi Magazine join us talking about the latest issue.

And it's their first ever wellness issue.

And not just physical wellness, but spiritual, financial, cultural, wellness, wellness and all forms.

Talking to the team from Citi about their newest issue, next hour on connections.

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This is connections.

whether you're listening, whether you're watching on the Sky news YouTube channel.

Great to have you on this Monday afternoon.

hello.

First on the line to Kathy in Chile.

Hi, Kathy.

Go ahead.

Hey, Evan.

my opinion, I guess, but I think the the whole tariff thing is a distraction.

I think that, like, the whole everybody's an outrage and an uproar about it, and that's all anybody is talking about right now.

And I think the real problem was they were hiding is that Elon Musk sent a bunch of Doge employees into their Treasury Department and OPM and GSA over the weekend, and they installed hard drives on all the computers, a lot of civil servants out of those systems.

And this morning they shut down U.S. aid.

Now, I think they picked a program that was large, but a lot of Americans didn't know anything about it.

It doesn't affect most Americans, and it's a test case to see whether they can do it, whether a Congress is going to react and everybody's service trusted with the tariffs that a lot of people are not.

And now that opens a lot of people up to blackmail because of those to do say to senators, well, you know, if you don't vote for our nominee or whatever bill we're putting in front of you, we're just going to shut down Social Security payments to all your constituents, or we're going to shut down some program that's important to you because they have access to it all now, and they have sole control over all of it now.

Well, let me just jump in, Kathy, and I appreciate you directing our attention to that.

That's something that we're going to talk about.

I'm sure NPR continues to cover that.

And you'll hear that, and I want to sort of a gray with part of that.

But I also disagree with another part of that.

And I do want to talk to, to be all about South.

It it's not, tariffs are not just a distraction for what's going on with Doge because Trump has telegraphed this for years.

This is a big deal for him.

I mean, we're going to see more tariffs.

He says.

We're definitely going to see tariffs on Europe.

We'll see more on Asian partners.

We'll see more.

so I don't think it's just meant to be a distraction.

But I do think not to go all as recline on you.

But I do think that the speed of what is going on is meant to be make it hard to focus on any one thing.

And Steve Bannon has said that in interviews.

That is part of why they do things the way they do things, because they don't think the American people or the American media can focus long enough to really key in on what's happening on one thing, because today it's tariffs, tomorrow it's Doge, and it's U.S. aid.

A few days from now it might be Ukraine, who knows?

And that strategy is very effective.

So I take your point that that that is very distracting.

There's all these things happening and you want our focus on what's going on with the Treasury, what's going on with the the control of money, the fact that the richest man in the world has been given the keys to the financial castle of this country.

That's a big story.

but I don't think it means that tariffs are just meant to be a distraction.

I mean, I think they are their own tool and you're going to see more of them, but I take Kathy's point.

I mean, those are all stories worth covering, Doctor Barnaby.

Oh, absolutely.

Absolutely.

And you're right in pointing out that this is part of the strategy of Stephen Miller and company that, you know, flood the zone with, you know, ten, 15 things at the same time.

Yeah, flood the zone.

That's right.

Stephen Miller, Steve Bannon, the Steves, that's what they want to do.

So so we're trying to focus day by day, hour by hour on these specific subjects.

But I hear you Kathy.

There's a lot to focus on.

We're going to do our best here.

and let me get Pat in Geneva.

Hello, Pat.

Go ahead.

Hi.

I like to bring it to something a bit more personal.

I remember during the Iran hostage crisis, everywhere you look, you saw American and Canadian flags adjacent.

There were bumper stickers that they both flags were on the same bumper sticker.

And I think younger people may not know about that.

And I also a little short story on a friend of mine lived on, on a farm in, down near Cortland, New York.

And it was a foggy, foggy morning, and she had a knock on her door and she was frightened, and she opened the door, and there were two Canadian soldiers standing at her front door, and they had engine trouble.

And they had put down in in her field, which was sticking up out of the fog, and she gave them breakfast and so forth.

They left when it cleared, and about a month later they knocked on the door and they brought her a gallon of maple sirup.

Now those pilots were were shuttling, Canadian helicopters, I think, to Lycoming Engine in Williamsport, Pennsylvania, where they had their engines rebuilt.

So that's just, just a little personal human interest story about the friendship we have.

Yeah.

I mean, you're right.

This relationship is deep and long, and it's important.

and I appreciate your perspective.

Gary writes to say something Trump does not realize about Canadians.

They have always worried about our intention to conquer them.

When one visits the Canada museum of history, there is an exhibit devoted to the War of 1812.

As one enters the exhibit, there is a sign that reads that the United States has tried to invade Canada three times.

If any of those had been successful, Canada would not be the free country it is today.

I wonder how many Americans realize that the invasion and forceful takeover of their country by the US has always been in the back of Canada's mind.

They will never acquiesce to being the 51st state, nor should they.

That is from Gary.

So Pat and Gary, with some things that let me turn to our Canadian guests there, Doctor Norman Fritz and professor of education living in Canada.

what do you make of Pat and Gary's points there?

Well, I think that, that people's personal experiences are play a big role.

I think that a lot of Canadians have, had personal experiences about, going to the border, visiting people in the US and Americans, helping Americans or first, most Americans up here in Canada.

and so I just think that there's so in addition to an emotional dimension, there's also like a personal dimension as well.

I've, I've lived in the U.S. and two different locations, in my life.

And, I come from especially the further south you go, the, the less that Canada sort of seems to be important in a very faraway place.

I think that's fair.

and and I think, you know, Gary's point, Doctor Elia is an interesting one that, you know, he's drawing on a lot of history there to say, if Trump thinks somehow that this is a ploy that will create some kind of pathway to acquiring Canada, he's probably going to lose Doctor Ly, do you want to elaborate?

There?

There.

I was struck by J.D.

Vance's tweet.

I'm not sure if anybody saw it about sparing him the sob story about Canada's our best friend, you know, implying that, these examples that we've heard from Prime Minister and, and in other media about the the examples throughout history, would where two countries have fought side by side, have helped one another, post 911 a story, in, in Newfoundland where, where hundreds of hundreds of Americans were helped by those who, who basically took them in because they're the the planes were rounded.

You know, the these aren't stories that are being brought up necessarily strictly to, develop some sense of, you know, feeling sorry for us.

And, you know, how could you ever ask us to be accountable for anything because we're French.

But that's not the intent.

The intent is that, you know, to highlighting that there's been an unspoken relationship, an unspoken kind of acknowledgment between the two countries that we are culturally arguably closer than any two countries on the planet.

a number of, you know, when the Ukraine war broke out, and you're seeing images of, of Ukrainian soldiers, defending their country against Russia.

I was at a campfire with a few friends, and we all kind of joke that, well, what would happen if the US ever, ever invaded us?

And our feeling at that time we all kind of agreed that what would we what do we fight?

What do we actually enlist and fight?

If the U.S. ever try to take over?

And and by large, our opinion at that time was, probably just give rectify not worth the loss of life.

We basically live the same lives anyways.

So be it.

Those a again, like I said before, there's a patriotism that's come up and and and I'm not sure how you un rang the bell to be honest.

because if if Trump were to to announce the tariffs are all right, during a month what what's, you know, whatever that be, whatever that, that is, this relationship is, is forever changed because we, we, we can't rely on an element of stability, at least for the next four years, you know, goodness knows what the future brings.

but we can't it can't be relied upon.

We have to, from a defense standpoint, from an economic standpoint, the, you know, not to be dramatic, but the international world order has been has been upended overnight, seemingly.

And and I think Canadians are well aware of of, of that right now and, and whether, you know, the guests you brought up, the other, the noises, the distraction from the Doge stuff, we really have no interest in in this because, yeah, it will be distraction after distraction for the next, for the next while.

And we don't, you know, no Canadians particularly have an interest in being in being dragged into the, the daily impulses of, of the president.

And and again, I think you're going to see, a definite steering away, from, from, from, from from our country, both diplomatically and, economically away from the US.

and I think it is I don't think they're wrong enough.

Well, there's a number of questions from listeners about sort of tariffs 101.

So let's do some of this.

Michael says it's been 50 years since I had economics classes.

What are tariffs supposed to do.

And did tariffs help caused the great Depression.

Doctor to all.

Yeah.

So the first question first what are tariffs supposed to do historically in the United States.

By which I mean 150 years ago or even longer.

One key objective of tariffs was to raise government revenue.

The second key objective of a tariff is to support that is to protect a domestic import competing sector.

So, for instance, if you're worried about steel from Japan or steel from China, and you leave your tariff on Chinese or Japanese steel, the idea is to protect U.S. steel manufacturers.

That's typically the key objective, along with revenue.

But in the last 50 or so years, even the revenue raising aspect of tariffs has largely been de-emphasized.

And if you are a member of the so-called WTO or the World Trade Organization, generally speaking, the levying of tariffs is illegal, except in a very narrow range of circumstances.

so on the subject of revenue, I've been trying to read far and wide to see is what the best case for this tariff action is.

So here's from the Wall Street Journal.

they write the following quote.

To serve as an economic advisor to Donald Trump, it helps to share his belief that tariffs can make the US richer.

Not many economists meet that criterion anymore.

Stephen Miron has made just that case.

Myron is the president elect's choice to chair his Council of Economic Advisers, and he has written that the US could be better off with average tariffs of around 20% and as high as 50% compared with the current 2%.

He even agreed with President Trump that tariffs could provide enough revenue to provide free child care for Americans.

I don't so end quote, that's from the Wall Street Journal.

So Trump finds an economic advisor who is a contrarian, to say the least of it.

but in the campaign, and I think during the debates, President Trump, then candidate Trump was saying, well, yeah, we're going to we're going to hammer the world with tariffs and we're going to use all that money.

We might be able to cut taxes because of it.

We'll be able to provide child care.

We'll be able to pay for all these programs.

And you seem to be saying that is not what tariffs do anymore.

That's right.

And even if you think about it, let's let's be real concrete about this.

Who actually pays the tariff.

So let's focus on just to give you an example say textiles from China, Walmart, the importer importing textiles or garments from China.

It's the importer Walmart, who's going to be paying the tariff, not China, repeat not China.

So the idea that you are somehow hurting foreign countries directly with tariffs is just plain false.

And isn't Walmart then just going to raise prices?

Oh, that's the next thing though.

So then Walmart has to decide I have these extra costs to deal with which I didn't have to thanks to Uncle Sam.

What do I do with it?

It may, if it thinks that the tariffs are only going to last for a couple of weeks, eat the extra costs and not pass it on.

But Walmart being a profit maximizing entity, the chances are very low that it's simply to eat these extra costs.

The chances are they're going to be passed off as higher prices to consumers.

So consumers in the United States shopping at Walmart are going to see price rises.

Alex wants to know how effective can these tariffs be, given how much Trump gave up the game with his test run on Columbia, make an insane demand.

Wait for concessions, and then declare victory no matter what changes.

Colombia's economy is smaller than many states in the United States.

That's correct.

That's correct.

Yeah.

So, for instance, the California economy is bigger than the economies of most countries in the world.

So, you know, attacking Colombia on a particular pretext.

And then claiming victory when the Colombian leader says, okay, well, we'll take some back, take some of our own citizens back, it's really not a victory.

We'll have to see what happens with China.

China's a problem like I've alluded to before, but if the Chinese were to capitulate like the Colombians have, then he could legitimately declare victory.

But I don't see that happening any time in the near future.

And, it, Charles writes in to say, well, the Canadian rock band rush isn't touring anymore.

Labatt blue was made by Jenny.

You can get maple sirup from the Adirondacks, and we have Tim Hortons and hockey teams here.

Remind me why we need Canadian products, why we need Canadian products?

Well, maybe the question should be posed in terms of a survey to residents of Wisconsin, Michigan and other Midwestern states about why we need Canadian energy.

If they could do without Canadian energy, you would think that they would have already done so, right?

Yeah.

I mean, I think Charles being a little cheeky there, but rush isn't the only export of Canada.

And and Dell writes in to say rather than the 51st state, any chance Canada would take New York as its 11th province?

I don't know, Doctor Friesen.

Let me ask, Norm.

You want to take New York on?

No, I think Dell's just kidding there.

But, Norm, what do you make when you hear President Trump and other Americans saying, well, what do we even get out of this?

You know, rush doesn't even tour anymore.

Labatt blue is made here.

What do we get from Canada?

Well, I think I think it's really important not to focus on brands, but, but on, commodities, because obviously that's that's what, energy is, whether it's oil from Alberta or electricity from Quebec.

And, I read somewhere that 60% of the oil in the US comes from Canada.

so it's these kind of sort of invisible things that I think are, that are really important.

And I think that under these circumstances, if this continues, then they'll become quite visible, painfully visible.

I think, Doctor Elia, what do you think?

They they're.

Mario.

Yes.

Right.

In terms of other actual, you know, products that the Americans need.

Yeah.

If if there weren't, then this wouldn't be an issue at all because, you know, 25%, tariffs on, you know, on unneeded products wouldn't be affecting Americans if they weren't eating our products, then we wouldn't be getting any, you know, any, any, any benefit from the exports.

Clearly there there are a number of products that, that are, that are across the border.

Interesting.

I'm very sad to see how this plays out.

I talked about kind of a made in Canada, you know, push and and the product in Canada push that we've seen here locally.

I'm interested to see due to Americans have the attention span to actually reciprocate.

And I don't know if they will necessarily, because of just the deluge of, of of issue after issue after issue coming from, from, from the white House and it being just so overwhelming versus we kind of have one issue to focus on, right?

This is so important to our economy that, you know, a protectionist stand at, the, the grocery store at, at the big box store, we can implement that.

You know, I won't say easily, but but be able to, to, to, to sustain that and see that attention on that kind of endeavor.

I don't know if that'll necessarily happen where, you know, Americans taking a Buy America stance, which has been floated for years.

And, you know, there's a reason why people but anyway go to the president himself will purchase products and yeah, and have have products from China.

So the reason I do that is because less expensive.

Will they actually be able to, follow through on a Buy America strategy given again, all the other chaos going going on in American politics right now?

That's an interesting point.

And doctor, part of you on the last 45 seconds of yours, what do you what do you looking at next year that will inform what this trade policy is actually about?

And what do you think we should be looking at?

Well, I think ideally we should be separating out our allies from the legitimate problems.

You can't lump Canada and China into the same boat and throwing Mexico for good measure and then say, okay, well, they're all in the same problem.

They pose similar problems for us.

So you have to differentiate between them.

Second thing is, one of those key things that you learn in economics is targeting.

If the problem has something to do with trade, then yes, attack trade.

But if the problem is something else illegal immigration, fentanyl, whatever it is that has little or nothing to do with trade, then don't link issues when they ought not to be linked.

And the final thing that I would say is that whatever else you do by trade policy, you have to treat China differently because it is an order of magnitude different beast than our either Mexico or Canada.

Well, it's been an insightful hour here, doctor.

I'm about to be our distinguished professor and the Arthur J. Gosnell Professor of Economics at.

Alright.

Thank you for the expertise.

Thank you for being here at this hour.

Very welcome.

Thank you for having me.

Our thanks to Doctor Mario Ally for joining us from Ontario.

Mario, great having you back.

Thanks for being with us.

Thanks, Ivan.

Doctor Norm Friesen, a professor of education living in Canada.

Norm, thank you for the insight as well.

You're welcome.

And listeners that got as many as your phone calls and emails.

I know there's a lot of fire on this topic.

We'll keep our eyes on it.

But to Kathy's point, we'll keep our eyes on a lot of things here.

We'll do our best, and we've got more connections coming up in a moment.

Oh.

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