Fareed Zakaria GPS
Episode Summary: "How Canada is Responding to Trump’s New Tariffs"
Date: February 2, 2025
Host: Fareed Zakaria
Guests: Chrystia Freeland (Canadian political leader), Peter Beinart (author), Reid Hoffman (tech entrepreneur), Keishin Yu Jin (economist)
Episode Overview
This episode of Fareed Zakaria GPS analyzes the implications of President Trump’s newly announced tariffs on Canada, Mexico, and China. The show explores the geopolitics and economics of these moves, focusing on Canada’s response with insight from Chrystia Freeland, a political frontrunner in Canada. It also touches on deep questions of Jewish identity and Israel in the aftermath of the Gaza War (with Peter Beinart), and the global AI arms race in light of a major Chinese breakthrough (with Reid Hoffman). The episode closes with a discussion with Keishin Yu Jin on China's preparedness for decoupling from America.
Key Segments and Insights
1. Fareed’s Opening Take: The China–US AI Race
[01:00 – 09:08]
- Main theme: The release of the DeepSeek AI model by a Chinese firm is likened to a “Sputnik moment” because it challenges American assumptions of technological dominance.
- Fareed argues:
- Open systems — where code and research are shared — tend to outperform closed systems. DeepSeek’s reliance on open-source models (like Meta’s Llama and Alibaba’s Qwen) is proof.
- Constraints, such as US chip bans, may actually foster innovation in China (as in the example of Huawei’s 7nm chip release under sanctions).
- The effectiveness and costs of US technology bans on China are questioned. Even if China remains months behind, the global economic cost and the potential for retaliatory action (cutting US access to key materials) are significant.
- Risks: Decoupling could create a global tech arms race, hinder innovation, and make the future more dangerous.
- Notable quote:
- “If artificial intelligence is as revolutionary a technology as we think it might end up being... having it unleashed in every realm of human life with absolutely no guardrails points to a scary future...” – Fareed Zakaria [09:00]
2. Canada’s Response to Trump’s Tariffs: Interview with Chrystia Freeland
[10:09 – 21:37]
Context
President Trump institutes 25% tariffs on Canadian and Mexican exports (with some exceptions for energy), prompting Canada to retaliate with 25% tariffs on American goods. Trudeau calls the move “a direct attack on our sovereignty.” Fareed examines Canada’s position and next moves with Chrystia Freeland.
Key Discussion Points
-
Canadian Response & Rhetoric
- Freeland denounces the tariffs as “utter madness” and “an act of economic warfare.”
- She emphasizes Canadian unity and anger, promising a strong and measured response.
- “This action is utter madness. It is a betrayal of America's closest friend, of your ally, your neighbor... It is an act of economic warfare.” – Chrystia Freeland [10:14]
- “Canada is the true north, strong and free... We're going to fight for our country, we're going to fight for Canada, and we're going to be successful.” – Chrystia Freeland [10:40]
-
Canada’s Economic Leverage
- Fareed points out the economic imbalance: Canada is more reliant on the US (75% of exports); for the US, Canada is just 12% of exports.
- Freeland rebuts this perception, asserting:
- “We have more leverage than Americans think. Canada is the largest market for the United States, larger than China, Japan, the UK and France combined.” – Chrystia Freeland [11:37]
- Tariffs are “self-harming” for Americans, raising US prices for oil, gas, and groceries.
- Freeland stresses that for Canada, this fight is about sovereignty and national survival.
-
Potential Boycott and Critical Minerals
- Freeland confirms that spontaneous boycotts of American goods are already occurring in Canada.
- Hints at more targeted retaliation, mentioning US dependence on Canadian critical minerals and metals (not just China).
- “Guess who also produces those? Canada.” – Chrystia Freeland [16:53]
-
Trump’s Motivations and Psychology
- Fareed questions Trump’s reasoning, noting minimal fentanyl flows from Canada.
- Freeland: “The one thing he [Trump] respects is strength. And if he sees weakness... he pushes harder and harder and harder. And so... what America is going to see from Canada, is total strength, total unity, and a very smart, surgical, strategic approach.” [17:53]
-
Economic Impacts – Lose-Lose Scenario
- Both agree that a trade war will harm both economies, with likely inflation in the US.
- “The path the US Is on right now is a lose, lose path. And at the end of the day, you cannot defy the laws of economics.” – Chrystia Freeland [19:20]
-
US Business Implications
- Freeland notes extensive integrated supply chains (auto parts crossing the border “8 to 16 times”).
- US firms and unions (e.g., United Steel Workers) are already voicing concern.
3. Being Jewish After October 7: Interview with Peter Beinart
[22:40 – 28:01]
Key Themes
-
Personal Evolution on Israel-Palestine
- Beinart recalls his shift in perspective after meeting Palestinians, realizing the realities of their oppression.
- “It began to change the very first day that I spent with Palestinians on the West Bank... the conditions under which they were living were more brutal than I had been able to imagine.” – Peter Beinart [22:43]
- Advocates for equal rights for all under Israeli control, drawing parallels with apartheid South Africa and Jim Crow South.
-
October 7, Gaza War, and Jewish Obligation
- Recognizes the trauma of October 7 for Jews, but calls for attention to the context: “Understanding context is not justification... you can’t understand how to prevent future October 7ths without understanding the conditions in which Palestinians live.” – Peter Beinart [24:54]
- Critiques the elevation of the state of Israel to a “god” or idol within Jewish life.
- Suggests the Jewish obligation is to value all life, including Palestinian children, over the abstraction of the state.
-
Reception in the Jewish Community
- Beinart admits his views make him unpopular in mainstream institutions.
- Finds hope in young American Jews questioning the status quo and yearning for “loving dissent.”
4. The Promise — and Perils — of Artificial Intelligence: Interview with Reid Hoffman
[29:08 – 35:27]
Key Points
-
On DeepSeek & Innovation under Constraints
- “Constraints do create good innovation opportunities... There’ll be lessons that come from that. We should learn those lessons as well.” – Reid Hoffman [29:58]
- Analogizes to training with ‘weights tied around your ankles.’
-
Optimism on AI's Potential
- Emphasizes that AI can provide “superpowers” to individuals — examples include:
- Ubiquitous, affordable medical assistants
- One-on-one tutors in every subject
- Professional AI “agents” to augment human work
- Emphasizes that AI can provide “superpowers” to individuals — examples include:
-
Workforce Disruption & Transformation
- Acknowledges job displacement, but expects most jobs will evolve to be “a human using AI.”
- “It’s not human or machine, it’s human plus machine...” [32:25]
- Industries and countries that embrace AI will experience gains analogous to the Industrial Revolution.
-
The Geopolitics of AI Dominance
- Fareed asks why US leadership in AI matters.
- Hoffman: It’s about setting norms and values for the technology globally (“American intelligence”).
- “This is much more than a Sputnik moment...” – Reid Hoffman [33:41]
-
The “Revenge of the English Major”
- As coding becomes automated, skills in humanities become more valuable.
- “Now, I do think that question of how you think creatively in humanities is actually in fact an important thing to add in, but you’re still going to need to be thinking about... patterns of code.” [34:29]
5. Can China Stand Up to Decoupling? Interview with Keishin Yu Jin
[36:08 – 40:18]
Main Arguments
-
China’s Readiness for US Trade Conflict
- “China has long been preparing for less exposure to the US... Diversifying in all ways, not just in terms of trading partners investment, but also currencies and payment system.” – Keishin Yu Jin [36:20]
- Many Chinese companies are implementing global (“going abroad”) strategies.
-
Redirection of Trade and Growing Global Share
- US tariffs have already caused China to redirect exports and forge new global trade relationships.
- “China’s position in the world as a share of global exports has actually risen... while US is declining.” [37:07]
-
End of Dollar Dominance?
- China and its partners developing alternatives to the dollar: swap agreements, digital currency, and alternative payment systems.
- “Whether it’s quietly or not so quietly building up this huge financial infrastructure... That’s actually happening at a much faster pace than we realize.” [38:45]
-
US May Underestimate Chinese Resilience
- “The resilience of China has been demonstrated to a certain extent... Exports have actually performed quite remarkably.” [39:45]
- China is not opposed to a Trump presidency, seeing room for negotiation.
Notable Quotes
-
“This action is utter madness. It is a betrayal of America's closest friend, of your ally, your neighbor... It is an act of economic warfare.”
— Chrystia Freeland [10:14] -
“The path the US Is on right now is a lose, lose path. And at the end of the day, you cannot defy the laws of economics.”
— Chrystia Freeland [19:20] -
“It began to change the very first day that I spent with Palestinians on the West Bank... the conditions under which they were living were more brutal than I had been able to imagine.”
— Peter Beinart [22:43] -
“If artificial intelligence is as revolutionary a technology as we think it might end up being... having it unleashed in every realm of human life with absolutely no guardrails points to a scary future...”
— Fareed Zakaria [09:00] -
“Constraints do create good innovation opportunities... There’ll be lessons that come from that. We should learn those lessons as well.”
— Reid Hoffman [29:58]
Key Timestamps
- [01:00 – 09:08] Fareed’s Take: China, AI, and US policy
- [10:09 – 21:37] Chrystia Freeland: Trump tariffs, Canadian retaliation, sovereignty, economic repercussions
- [22:40 – 28:01] Peter Beinart: Jewish identity after Gaza, Israel’s future, ethics of dissent
- [29:08 – 35:27] Reid Hoffman: DeepSeek and the global AI arms race, economic/work implications, US-China AI competition
- [36:08 – 40:18] Keishin Yu Jin: China’s resilience, trade diversification, rise of economic blocs, dollar alternatives
Tone and Style
- Direct, frank, and analytical (especially from Freeland and Beinart)
- Forward-looking, sometimes urgent (Fareed’s AI warnings)
- Mix of hope and realism (Hoffman’s optimism about AI outcomes, Freeland’s vision for Canadian unity)
- Candid and historically aware (Beinart’s critique of Israel, references to past struggles for equality)
For Listeners Who Missed It
This episode offers a multifaceted exploration of a potentially seismic shift in North American trade, the future of global technological leadership, and the evolving meaning of Jewish identity in a time of crisis. It delivers sharp policy insight, firsthand reactions from key figures, and a healthy dose of skepticism about the wisdom of economic confrontation in a highly interconnected world.
