Three days ago, Donald Trump announced Canada and the United States had a deal. Today, 50% tariffs are live, Canada is drawing up retaliation, and the “historic allies” line diplomats love to repeat is starting to sound like wishful thinking.
According to reporting from the Associated Press and PBS News, Trump said on Tuesday that he was pausing 50% tariffs on roughly $20 billion worth of Canadian imports, announcing on his social media platform that the two countries had reached a deal “subject to the finalization of documents.” The pause bought three extra days for negotiators to close the gap.
It didn’t hold. The Washington Post reported that the potential deal fell apart, and the U.S. tariffs on Canadian goods took effect early Saturday morning as originally scheduled before the brief pause. Canadian Prime Minister Mark Carney responded by calling Trump’s tariffs “a miscalculation” and announcing that Canadian retaliatory tariffs on U.S. goods will take effect September 8, according to the Post.
ABC News reported that, unlike earlier rounds of tariffs, this set applied even to goods compliant with the United States-Mexico-Canada Agreement (USMCA) — the very trade pact Trump negotiated during his first term. Exemptions kept the list narrower than it could have been, but ABC noted it still covers dairy products, honey, whey protein, molasses, and alcoholic beverages including whiskey and vodka.
The U.S. Trade Representative’s office had described the near-deal as including “comprehensive market access for all American goods, economic security commitments, digital trade alignment,” according to ABC News. Trump had also floated reviving the long-canceled Keystone XL pipeline as part of the negotiations, telling reporters the project “may be awoken from the grave.”
King & Spalding trade partner Ryan Majerus told the AP before the collapse that neither side really wanted the tariffs to take effect and that there was a strong push on both sides to find an off-ramp. Canadian Chamber of Commerce CEO Candace Laing said the earlier three-day delay offered businesses some relief but fell short of the certainty a signed agreement would have provided, adding that the “limbo state is not anyone’s preferred outcome.”
