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Trump hits Canada with an unhinged tariff letter [1]

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Date: 2025-07-10

Donald Trump has thrown down a completely unnecessary gauntlet. It's all based on incorrect information. Canada is suddenly a major source of fentanyl getting into the United States. Trump says it is a great honor for him to send the letter and then he says this:

"... the fact that the United States has agreed to continue working with Canada, despite Canada having financially retaliated against the United States."

I think Trump is talking about the digital service tax that Canada has already dropped. But he does not specify, so we have no idea what the retaliation is/was.

"As you will recall, the United States imposed tariffs on Canada to deal with our Nation's Fentanyl crisis, which is caused, in part, by Canada's failure to stop the drugs from pouring into our Country."

The claim is imagined. We probably send more fentanyl to Canada than comes from Canada. The amount making it over the border is so little, that's it's pointless to talk about it. In 2024, 43 lbs was seized at the Canadian border, where 21,000 lbs were seized at the Mexican border.

Trump is setting up a 35% tariff on top of the tariffs already set on what he calls sectoral tariffs, which are the ones that are on steel and aluminum and timber, which were, I think, 25%. So now you've got a 60% tariff on those. The timber alone will crush the construction industry.

Then there's the normal carrot and stick. That if Canada manufactures their stuff in America, there's no tariff. Then there's also no Canada. Trump implies that manufacturing facility permits would be taken care of in a matter of weeks.

"If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added on to the 35% we charge."

This is worse than the crazy math formula that Peter Navarro came up with for the tariffs that were set on Liberation Day, April 2nd. Which are now finally going into effect August 1st. Trump has three weeks to TACO.

"Canada charges extraordinary tariffs to our Dairy Farmers --- up to 400% --- and that is even assuming that our Dairy Farmers have access to sell their products to the people of Canada."

Then, of course Trump calls this a problem of national security. What Trump doesn't realize is Canada has a quota system for dairy products. Up to a certain level there are zero or low tariffs. Going above the quota, yes, tariffs come into effect. Canada is not blocking US dairy farmers from selling their products to Canada. It's just a bald-faced lie.

"If Canada works with me to stop the flow of Fentanyl, we will, perhaps, consider an adjustment to this letter."

Perhaps. So, Canada could do everything Trump wants, and then nothing happens. Of course, that's a great way to negotiate. Canada has probably already done everything they possibly can to prevent that 43 lbs a year from coming into the US. The crisis is at the southern border. I cringe at thinking with the his letter to Mexico is going to be like.

"Thank for this attention to this matter!"

Well, this time he didn't talk about it being a privilege to do business with the United States. He had too many other nasty things to say. But the third person sign off is still that sign of cognitive decline, in my mind. But Canada, and PM Carney is going to pay attention to his letter and tell him where to put it.

Trump issued his letter after markets had already closed. We'll see what happens overnight and in the morning. It probably won't be good.

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