Canada is losing its trade war with Trump

Yahoo:

Canada is out of ammunition to fire back at the United States if NAFTA talks fall apart and the Trump administration ramps up trade aggression, according to experts monitoring the negotiations.

Ottawa’s counter-tariffs on American steel, aluminum and a list of goods ranging from pens to playing cards have put $300 million in government coffers, according to the Canada Border Service Agency. Canada has pledged to keep the measures in place until the U.S. lifts its duties on Canadian steel and aluminum.

That counter-punch isn’t having a big enough impact on American companies and states that sell goods north of the border, according to Harper-era trade advisor Adam Taylor. He said U.S. officials have not been convinced to go easy on Canada, and Ottawa has little recourse if trade attacks escalate.

“It seems like we sort of emptied our clip,” he told Yahoo Canada Finance. “We have significantly more to lose, and the Americans know it.”

The U.S. and Mexico are pushing Canada to sign a deal by the end of September or face exclusion from the pact. Prime Minister Justin Trudeau has made it clear that Canada will not agree to a deal that does not represent his country’s best interests.

Ottawa and Washington continue to be at odds over issues including the Chapter 19 dispute resolution mechanism, intellectual property rights, and Canada’s supply-managed dairy system.

Meanwhile, U.S. President Donald Trump is looking to use a new three-party agreement as evidence of his deal making prowess as U.S. trade tensions escalate with China, and talks continue with the European Union.

Denying him that may come at a significant cost for Canada.

“If we don’t do a trade deal, the only way to get Canada back to the table is going to be an escalating trade conflict,” said Christopher Sands, director of the Center for Canadian Studies at at Johns Hopkins University. “I have to be somewhat sympathetic to the Canadians.”

Taylor said Canada’s carrot and stick approach to swaying state-level legislators to it’s cause by emphasizing economic ties and targeting regional economies with tariffs has so far proven fruitless.
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Canada needs to make concessions on its trade barriers, particular its ridiculous dairy tariffs. Those barriers to US goods are inconsistent with a free trade agreement.  Meanwhile, the counter tariffs imposed by Canada are driving up the cost of living for Canadians and are not causing political damage to Trump.