President Donald Trump meets with Canadian Prime Minister Justin Trudeau during the G-7 summit, Friday, June 8, 2018, in Charlevoix, Canada. (AP Photo/Evan Vucci)

 

On May 31, the Trump administration announced that it was imposing tariffs on steel and aluminum imports from Canada, Mexico, and the EU. Now Canada’s Justin Trudeau has announced that Canada will slap US steel and aluminum with retaliatory tariffs on July 1.

On the whole, this is pretty meaningless. Canada’s industrial base and population is smaller than that of the US by an order of magnitude so both sets of tariffs are going to be felt most heavily in Canada. But the iron and aluminum tariffs were chosen because Trump could make an arguable national security connection to them. The real target is Canadian agricultural tariffs which, at least in spirit, should have been eliminated with NAFTA (the FT means “free trade” or so I’m told).

I’d be willing to predict that this spat goes on for weeks, not months, before there is a reconciliation. I’d also be willing to bet that we see some of Canada’s agricultural tariffs go away.

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