REGINA, Sask. — Former federal Liberal cabinet minister and diplomat Ralph Goodale is urging Canadians to stand their ground in their current trade dispute with the United States.
“Well, it's not a happy situation — this is not where we want to be in the midst of a trade war with the United States,” said Goodale, speaking to SaskToday on Tuesday.
But Goodale, who this year was appointed to the Advisory Committee on Canada-U.S. Relations, also noted Canada “did not start this trade war” with President Donald Trump and the United States.
“But now that we have been attacked, and more than once by the United States, we have to defend ourselves,” Goodale said.
“We have no choice — if we were to just ignore the situation, Mr. Trump would go after more and more and more.”
Goodale emphasized that Trump’s goal is not to get “a good business deal between Canada and the United States. His goal is annexation. His goal is the subjugation of the Canadian economy.
“So while we didn't start this trade war, we have to stand our ground and we cannot allow ourselves to become a vassal state.”
Goodale called it a tough situation but said the portion of the Canadian economy that is being affected by the trade dispute so far is “relatively small.”
He said the 50 per cent American tariffs applied to Canada on Aug. 21 only affect “about five per cent of Canada's exports to the United States.” The counter-tariffs applied on Sept. 8 again impacted a dollar value of five per cent of U.S. exports into Canada, Goodale said.
“But I think you have to make two big caveats. Number one, the size of that could grow to be something much more significant than it is today and if you are within the category of products moving one direction or the other that are subject to these 50 per cent tariffs — the American tariffs in one direction and the Canadian tariffs in the other direction. And some businesses will be subject to both. If you're in that position, it is a very painful situation — because the whole burden of the tariff war is falling on you. So while it's a relatively small part of the Canadian economy so far, we have to treat this with great seriousness. Because for those who are being affected, they're being hit really hard.”
Goodale acknowledged many of the businesses hit hardest by the tariffs from the U.S. have been those involved with steel, aluminum and auto production. But he also noted those industries have been getting hit from the beginning.
What's new about the most recent American tariffs and Canadian counter-tariffs, he said, is that “they tend to impact most significantly on smaller businesses, who up to now were probably exempt from most of the problem under the terms of the CUSMA agreement — the Canada-United States-Mexico Agreement,” said Goodale.
“But these most recent tariffs do not exempt or provide any special privileges for goods that are compliant with CUSMA, and they also tend to be things that in addition to the steel and the autos and forest products and so forth, they tend to be niche markets and products that are produced and exported by small businesses.”
The problem there as well, Goodale said, is that the steel, aluminum, auto and timber industries are large segments of the economy with significant resources to draw upon.
“Small enterprises don't. They don't have the in-house staff, they don't have the deep pockets, the deep financial pockets. They don't have the top-flight trade counsellors and advisers and lawyers and negotiators — they are sort of on their own.”
He also noted small businesses employ the largest number of employees in the Canadian economy.
“An overwhelming majority of Canadians are employed one way or another in small businesses. So that is the short-term immediate priority that I think the government needs to focus on in terms of providing support and providing relief to make sure that obviously all Canadians are taken care of, but small businesses in particular because they're carrying an extra burden here.”
Goodale’s comments on trade came just after the Canadian counter-tariffs came into effect on Sept. 8 and before President Trump responded with a ban on alcohol, certain dairy products and motorcycles coming into the U.S. from Canada.
It also came soon after a national address by Prime Minister Mark Carney, who warned of more pain to come for Canadians.
Goodale was of the same view because the U.S. was “a much larger adversary.”
“The United States economy is ten times bigger than the Canadian economy. So they have more bench strength. They have more depth, they have deeper pockets, and they can just as a matter of brute force inflict more damage.”
Goodale said that in fighting back against such an adversary, Canadians “have to simply be smarter in how we respond and how we defend ourselves.”
One example, he said, was in the counter-tariffs that were implemented on Sept. 8.
“Those counter-tariffs are not sort of willy-nilly across the board, they're very carefully calibrated and calculated to have maximum impact in the United States with minimum blowback in Canada and they are intended to send a political message in the United States that these tariffs are counterproductive. They're doing great harm not just to Canada, but also to Americans themselves.”
Goodale added that when a tariff is applied on the Canadian side to deter American products from coming into Canada, Canada needs to make sure that “that gap is filled by Canadian products.”
The whole idea, he said, was “levelling the playing field with the counter-tariffs keeping the American product out, so there's more room in the Canadian market for the Canadian products and a very intensive ‘Buy Canadian’ theme is needed here, and I think we've seen that. Consumers certainly seem to get it with their attitude toward buying American liquor or buying American food products at the grocery store, or postponing or cancelling the travel that they had planned in the United States and so forth. Consumers, I think, are picking up on this theme about ‘buy Canadian, be our own best customers, support each other within Canada.’”
Goodale added he thought there needed to be a “more concerted effort in this regard by the corporate sector in Canada and the government sector in Canada,” especially when it comes to procurement.
“Some of the biggest procurement campaigns, the procurement needs, are at the provincial government level. They are big buyers of goods and services, and I'm sure generally speaking they try to buy locally or buy provincially or buy from other parts of Canada, but now I think provinces and Crown corporations need to comb through their books, identify where they're relying on American suppliers, and look very hard for ways to terminate those contracts and find Canadian suppliers that they can do business with within Canada.”
