Trump escalates trade war; doubles tariffs on Canada steel, aluminum

In an all-caps post on his Truth Social media platform, Trump called Canada “one of the highest tariffing nations anywhere in the world.” The president said the doubled U.S. steel and aluminum tariffs would take effect Wednesday morning.

In addition, Trump demanded that Ottawa “must immediately drop their Anti-American Farmer Tariff of 250% to 390% on various U.S. dairy products, which has long been considered outrageous.”

Trump ignited the economic war last week with Canada, normally a staunch ally and the U.S.’s second-biggest trading partner after Mexico, by first imposing and then delaying for a month a 25% tariff on all products exported to the United States. Trump said he is pressuring Canada to further curb the flow of migrants and illicit drugs, especially the deadly opioid fentanyl, into the United States.

White House press secretary Karoline Leavitt told reporters that Trump was boosting the steel and aluminum tariffs because “Canada has been ripping off the United States of America and hard-working Americans for decades."

Outgoing Canadian Prime Minister Justin Trudeau retaliated by announcing increased tariffs on U.S. exports. Then, Doug Ford, Ontario’s provincial leader, said that effective Monday, he was charging 25% more for electricity Ontario sends to residential and business customers in three northern U.S. states that border Canada: Michigan, Minnesota and New York.

“I will not hesitate to increase this charge. If the United States escalates, I will not hesitate to shut the electricity off completely,” Ford said at a news conference in Toronto.

He added, “Believe me when I say I do not want to do this. I feel terrible for the American people, who didn’t start this trade war. It’s one person who is responsible. It’s President Trump.”

With the added Canadian duty, U.S. residential bills in the three states would increase by about $69 a month, Ford said.

Leavitt called Ford’s comments “egregious and insulting.”

In his social media posting, Trump responded that he will “shortly be declaring a National Emergency on Electricity within the threatened area. This will allow the U.S to quickly do what has to be done to alleviate this abusive threat from Canada.”

“If other egregious, long time Tariffs are not likewise dropped by Canada, I will substantially increase, on April 2nd, the Tariffs on Cars coming into the U.S. which will, essentially, permanently shut down the automobile manufacturing business in Canada,” Trump declared. “Those cars can easily be made in the USA!”

Trump also renewed his designs on making Canada the 51st U.S. state.

“This would make all Tariffs, and everything else, totally disappear,” he contended. “Canadians’ taxes will be very substantially reduced, they will be more secure, militarily and otherwise, than ever before, there would no longer be a Northern Border problem, and the greatest and most powerful nation in the World will be bigger, better and stronger than ever — And Canada will be a big part of that.”

He suggested that the Canadian national anthem, “O Canada,” could still be sung, “but now representing a GREAT and POWERFUL STATE within the greatest Nation that the World has ever seen!”

Trump’s tariff-trade wars with Canada and Mexico, which he also hit last week with a new 25% levy on exports before likewise delaying it, have sent jitters through Wall Street.

Stock indexes have plunged for days, wiping out vast market gains for wealthy Americans along with much more modest profits for everyday investors.

After sharp losses in the three major U.S. stock indexes on Monday, the markets lost more ground in trading on Tuesday but not anywhere near as much. The bellwether Dow Jones average of 30 key stocks was off a bit more than a percentage point after falling by 2 percentage points on Monday.