Sanity prevailed, as someone appears to have explained the tariff math to the Premier of Ontario:
Canada folded to President Donald Trump after he vowed the nation would pay a historically big ‘financial price’ for the electricity tariff it imposed on the United States. Hours later, Ontario Premier Doug Ford said he would cancel the 25% tariff on Canadian electricity to Michigan, New York and Minnesota that he put in place on Monday.
That move was an escalation in response to earlier tariffs from Trump as the trade war between the two countries has intensified.
The Premier said he spoke with Commerce Secretary Howard Lutnick about the situation and they agreed to meet on Thursday to discuss reciprocal tariffs that Trump wants to put in place on April 2. ‘In response, Ontario agreed to suspend its 25 per cent surcharge on exports of electricity to Michigan, New York and Minnesota,’ Ford said. Trump, in response, agreed not to double tariffs on Canadian steel and aluminium to 50%. They will stay at 25%.
In the meantime, the God-Emperor 2.0 has moved on to the EU and the UK. The UK is being smart about it.
Keir Starmer is resisting pressure to retaliate today after failing in his bid to persuade Donald Trump to spare Britain from brutal tariffs on steel. The US president has pushed ahead with the 25 per cent levy on steel and aluminium imports despite desperate pleas for an exemption. Britain exported 166,433 tonnes of steel to the US in 2023, the last full year for which figures are available.
The EU, not so much:
Brussels said counter-measures to the tariffs, which would affect around 26 billion euros (around £22 billion) of EU exports, will be introduced in April ‘to defend European interests’.
I am beginning to conclude that these particular tariffs aren’t about economics at all. This is about the US President attempting to rebuild the US industrial capacity that presently renders the USA unable to fight a war with either China or Russia. Which the USA simply cannot do when its steel industry is so susceptible to foreign competition and steel suppliers that will be inaccessible and useless in times of war.
The various foreign countries should accept these tariffs on industrial materials without demur, because the USA really doesn’t have any choice in the matter if it is going to remain one of the top three global military powers.