Who Needs Who? -Trump Tariff affect on Canada, U.S.

Recently I’ve heard several American commentators on news programs or on-line, state that “Obviously Canada relies on the U.S. far more than the U.S. Relies on Canada and therefore Canada will suffer much more from Trump’s tariffs than the U.S. will.  Trump has stated multiple times that the U.S. doesn’t need anything from Canada.  But is this true?  To find out I went to CHAT GPT to gather some impartial information.  I asked Chat GPT to provide a list of 10 products (not brand names, actual products that Canada receives from the U.S. that are not available to Canada from another source.  Likewise, I asked for a list of ten products that the U.S. gets from Canada that are not available from other sources.  To clarify, communist countries or countries run by dictators were not considered.

CHAT GPT’S LIST OF CANADIAN IMPORTS FROM THE U.S.  that Canada cannot get elsewhere.  Note that CHAT GPT made a couple of assumptions assuming the U.S. /Canada relationship of 2024 and earlier.  I have tried to update these issues.

CHAT GPT SUMMARY

There are very few (if any) products imported by Canada from the U.S. that are not available from another country. Those that are, are often related to geographic proximity, trade agreements or common regulatory standards.  Note that GPT considers the USMCA agreement as being valid, while Trump has already nullified it by his actions.

The list:

1. Pharmaceutical products. Specifically for niche drugs where U.S. companies hold patents.
2. Specialized aerospace components (see note re-Swedish Saab fighter jets)
3. High security defense equipment – only applies to defense products specifically procured from the U.S.  Other countries have alternative equipment
4. Processed foods and beverages – only applies to certain brand names
5. High security defense equipment only sold to Canada through defense agreements – Assumes products purchased from the U.S. as specified in Item #3 
6. Genetically modified seeds and grains, basically due to patents held by U.S. companies.
7. Hollywood entertainment – (seriously?)
8. Highly specialized IT and software – specifically tied to government systems
9.  Specialized medical equipment – many of which require rare earth metals from Canada for them to operate.
10. Space Technology components

SWEDISH SAAB FIGHTER JETS AND OTHER AIRCRAFT.

Canada currently has several American hi-tech military products, mostly aircraft, on order from the U.S., which explains some of CHAT GPTs assumptions.   But assuming these orders are cancelled as part of a Canada first National Security policy.  Ie: why would any country purchase military hardware from a country that has a stated objective to destroy their sovereignty.  Therefore, it stands to reason, that Canada would purchase comparable military products from other sources. 

THE LIST OF PRODUCTS SUPPLIED TO THE U.S. FROM CANADA

1. Softwood lumber.  The U.S. does not have sufficient wood milling capacity to meet its own national needs
2. Oil sands crude.  Many U.S. refineries are designed to use heavy crude oil that comes from Alberta’s oil sands – There are other suppliers of this type of oil (ie: Venezuela Kazakhstan, Russia ).
3. Uranium – alternate sources are Kazakhstan, Australia
4. Hydroelectric Power – sorry no alternative except what the U.S. produces itself.
5. Nickel (high quality class 1) – other sources Russia, South Africa, Australia.
6. Potash – Canada is the number 1 Potash producer in the world. Other major sources include Russia, Belarus and China.
7. Caesium – a rare metal used in electronics and medical devices.  Also available in lesser amounts from Australia and Namibia.
8. Asbestos free chrysotile fibers – used for fireproof materials, brake pads and clutches.
9. Maple Syrup – the real stuff not ‘Aunt Jemima’
10. Ice wine

So, the knee jerk assumption that Canada and Canadians need US goods more than the U.S. needs Canada’s is not supported in fact.  While the U.S. provides a great deal of products to Canada, there is nothing that Canada can’t get elsewhere or doesn’t need at all.  While the reality is that there are Canadian products that it would be very difficult and expensive for the U.S. to replace. It is true that in a FREE TRADE environment Canadians benefit by piggybacking on the U.S. market, and we buy a lot from the U.S. This is for two reasons. First, the U.S. population is nearly ten times that of Canada, (volume equals lower prices), and supply chains are short and well developed.  But in what may be a future economic reality where each nation must stand on its own, each country will have to find alternative supplies. In this endeavor economic partnerships will be important, and in this regard, Canada has a huge advantage.  Canada has friends.  Canada can piggyback on the European market.  Europe’s population is actually bigger than that of the U.S. and although supply lines would be longer, developing new ones is already happening.  Canada also has the option of linking with the Asian Pacific trade countries, or BRICS.  While China isn’t exactly our friend, they aren’t a political and economic enemy either, and Canada has good relations with South American and Central American countries.  On the other hand, it is hard to say when or if the U.S. will reconcile with Europe, BRICS, or China.

Then again, a stand-alone USA, could join with Russia. A marriage of two strong personalities each isolated from the world community, and each determined to be the boss.  The divorce would be swift, violent and bloody with neither having any friends and with no winner.

SO – TRADE WAR? – WE WIN!

We have alternatives both for supply and for customers.  Canada can and will grow because of Trump’s Tariffs.  New trade routes to Asia, Europe, Central America, the Mediterranean shores, Australia, Africa and the Middle East We can ship our oil and LNG to Asia, or Europe, or both.  We can sell our lumber and grain to CHINA, and our minerals to Europe.  We can build and supply car parts or even domestically made cars to Europe (there is already a CANADIAN automotive company building cars in Europe) We can also buy anything we want or need from Asia or Europe. In addition, we have open trade with Mexico, Central, and South America.  You know, the countries surrounding the Gulf of Mexico.  We also don’t have any Tariffs on the Middle or Far East, making fruit, and vegetables of all kinds, readily available.  Avocados to aircraft, cars to cannons, not a problem.  The U.S. on the other hand has few friends, and lots of enemies. You have indeed made America (proper name -the United States of America) great again.  MAGA FOREVER!