Ottawa Names Its U.S. Tariff Targets Today
Ottawa Names Its U.S. Tariff Targets Today
The News
The state of play
Canada's federal government will unveil the details of its retaliatory tariffs against the United States on Tuesday, CTV News reported Tuesday morning. CTV had reported Monday, citing multiple sources, that the announcement was coming Tuesday; the Associated Press reported the same timing, citing an official familiar with the plans.
What is not public yet is the part that matters to anyone filling out a customs form: the product-by-product list, the dollar value Ottawa puts on it, and which minister signs it out. That is what today's announcement is expected to supply. As of publication, no such list had been released. This story will be updated when it is.
Timeline
The frame is already on the record, from Prime Minister Mark Carney himself. In a speech from the Parliament building in Ottawa on Saturday, Aug. 22, Carney said Canada's countermeasures would take effect Sept. 8 and would hit steel, dairy, appliances, agricultural equipment, pulp and paper and electronics — and would also cover products already subject to what he called the unjustified U.S. Section 232 and Section 338 tariffs, Reuters reported. Carney said Canada would match Washington's new tariffs "dollar for dollar," according to Al Jazeera, which also reported the Sept. 8 start date. The Hill reported the same Saturday announcement and the same effective date.
The other direction is already live. New 50 percent U.S. tariffs on a selection of Canadian goods took effect after the two governments failed to reach a deal on Friday, France 24 reported. The Daily Mail reported that trade talks collapsed Friday night, when Carney withdrew from negotiations hours before the 50 percent tariffs on $20 billion worth of Canadian goods were due to take effect. The AP describes the covered goods as running "from honey to hockey sticks."
Reactions
Washington's answer, so far
No U.S. government response to Tuesday's expected announcement had been issued as of publication.
The administration's position going into it is not subtle. U.S. Trade Representative Jamieson Greer told CNBC on Monday that Ottawa changed its demands at the eleventh hour, suggesting Canada was responsible for the collapse of the talks. The Financial Post reported Greer's position that Canada needs to scrap its retaliatory measures to avoid new tariffs from the White House; the AP reported Monday that President Donald Trump was threatening 50 percent tariffs on more Canadian goods as the rift deepened.
Trump spent Monday on the same theme from two directions. Bloomberg reported that he lamented that his northern neighbor does have something he wants — aluminum — after arguing the U.S. does not need Canada. The Independent reported that he attacked Ontario Premier Doug Ford, calling him less intelligent than his late brother, former Toronto mayor Rob Ford.
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What is at stake for Americans
The sectors Carney named are American export lines. Steel, dairy, appliances, farm equipment, pulp and paper and electronics shipped north would face Canadian duties from Sept. 8 under the framework he set out, per Reuters.
The AP also reported Tuesday that the trade war is intensifying as the midterms approach, threatening Republican efforts to address voters' economic worries in a year when control of the Senate is at stake. On what the fight could mean for U.S. prices, see our earlier piece: Kashkari: Canada Tariff Fight Could Extend Inflation.
How it got here
The talks broke down Friday and the U.S. duties landed Saturday, invoking Section 338 of the Smoot-Hawley Tariff Act of 1930. That authority is contested, but no court has ruled on these tariffs. In opinion analysis published by Reason's Volokh Conspiracy blog, law professor Ilya Somin argues the Section 338 tariffs are illegal, citing an earlier guest post by the Hoover Institution's Philip Zelikow arguing the provision was superseded by legislation enacted in 1962 and 1974 and has not been used to impose tariffs since at least the 1940s, and a guest post by Georgetown trade law specialist Peter Harrell arguing the tariffs fail the statute's requirements even if it is not defunct. Somin writes that he expects legal challenges. A CSIS explainer says Section 338 lets the president impose tariffs of up to 50 percent, or bar imports outright, from a country found to discriminate against U.S. products, 30 days after an initial presidential announcement.
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