Elbows Up: Canada’s Response to Trump’s Trade War

Summary

Podcast Summary: The Daily – "Elbows Up: Canada’s Response to Trump’s Trade War"

Introduction

In the March 13, 2025 episode of The Daily, hosted by Kim Severson and Matina Stivas Gridneff from The New York Times, the focus is on the escalating trade war between the United States, under President Donald Trump, and Canada. This conflict has not only strained the economic ties between the two neighboring nations but has also ignited profound political and cultural shifts within Canada. The episode delves into how this trade war is reshaping Canada’s economy, politics, and national identity, providing listeners with an in-depth analysis of the unfolding crisis and its broader implications.

Background: Origins of the Trade Tensions

The trade tensions between the U.S. and Canada intensified with President Trump’s administration, which adopted a confrontational stance towards international trade agreements. Initial signs of strain appeared in early December when Canadian Prime Minister Justin Trudeau dined with President-Elect Trump at Mar-a-Lago. While the meeting appeared cordial on the surface, underlying tensions soon became apparent.

Matina Stivas Gridneff highlights, “Fox News is reporting that Trudeau warned Trump that his tariff proposal would kill the Canadian economy, to which Trump replied that Canada could then become the 51st state and that Trudeau could be governor” ([04:07]). This exchange marked the beginning of a more aggressive U.S. approach toward Canada’s trade policies.

Escalation: Implementation of Tariffs

By late January, the situation escalated as President Trump unequivocally threatened to impose tariffs on all Canadian and Mexican goods entering the United States. Given that approximately 80% of Canadian exports, including vital sectors like oil and gas, flow into the U.S., these tariffs posed a severe threat to Canada’s economy.

“This is a core existential economic relationship,” Matina explains ([06:27]). The tariffs could potentially derail Canada’s economic stability, forcing the country to seek alternative trading partners and reconsider its economic dependencies.

Canadian Public Response: Unity and Nationalism

The American tariffs and rhetoric ignited a wave of nationalism and unity across Canada. Canadians, traditionally perceived as amicable and accommodating, found themselves united against what they perceived as unwarranted aggression from their southern neighbor.

Matina observes, “We’re seeing by Canadian signs, grocers are putting up flags to tell consumers which products are made in Canada so that they can prefer them over American products” ([10:47]). This grassroots movement encouraged consumers to support domestic products, reflecting a broader societal shift towards self-reliance and national pride.

Notably, Matina recounts the emergence of overtly anti-American sentiments, including instances of Canadians booing the American national anthem at hockey games and expressing disdain towards prominent figures like Wayne Gretzky, who were seen as symbols of American influence.

Political Shifts: Revival of the Liberal Party and Rise of Mark Carney

The trade war had significant repercussions on Canadian politics, particularly for Prime Minister Justin Trudeau and the Liberal Party. Facing declining approval ratings and the threat of losing power to the Conservatives, the Liberal Party experienced an unexpected revival fueled by the public’s anti-Trump sentiments.

Matina explains, “Anti US Anti Trump sentiment is basically doing huge favors to the Liberal Party, even rehabilitating the image of Justin Trudeau” ([14:33]). As Trudeau prepared to resign, the party rallied around Mark Carney, a seasoned economist and former governor of the Bank of Canada and the Bank of England.

Mark Carney’s leadership signaled a strategic pivot for Canada. Despite being a political novice with limited public visibility, his reputation as a competent economic policy expert resonated with Canadians seeking stability amid the trade turmoil. Matina notes, “He thinks he knows what he’s doing, but Carney has a huge challenge in his hands” ([17:07]).

Strategic Reorientation: Diversifying Trade Partnerships

In response to the instability caused by U.S. tariffs, Canada began actively seeking to diversify its trade relationships. With the United States historically accounting for the majority of its exports, Canada recognized the urgent need to establish new economic partnerships globally.

Matina highlights, “Half of Canadians, according to a recent poll, want to even join the European Union” ([23:59]). This shift towards Europe and other international markets aimed to mitigate the risks associated with overdependence on the U.S. economy.

Additionally, Canada faced challenges with China, another significant trading partner, which had imposed tariffs in a bid to leverage the situation with the United States. This dual pressure from both the U.S. and China forced Canada to adopt a more strategic and multifaceted approach to its international trade policies.

Future Prospects: Rebuilding Trust and Redefining National Identity

The episode explores the long-term implications of the trade war on the Canada-U.S. relationship. Matina suggests that rebuilding trust will be challenging, given the economic damage and deep-seated distrust that has developed.

“It does feel kind of permanent,” she states ([24:55]). However, there remains a possibility for reconciliation under new leadership and revised terms that respect Canada’s sovereignty and economic interests.

Moreover, the trade war has sparked a broader reassessment of Canadian identity. There is an increasing emphasis on “a more assertive, and a prouder, more Canadian Canada” ([26:11]). This national introspection is driving efforts to strengthen domestic industries, invest in innovation, and redefine Canada’s role on the global stage.

Conclusion: An Assertive and Resilient Canada

The episode concludes with an optimistic yet cautious outlook on Canada’s ability to navigate the complexities of the trade war. While the immediate challenges are formidable, the crisis has also catalyzed significant political and economic reforms that could position Canada as a more resilient and autonomous nation in the future.

Kim Severson aptly summarizes the sentiment: “We will never be the same as friends” ([01:57]), encapsulating the profound and lasting impact of the trade war on the Canada-U.S. relationship. Despite the adversities, Canada’s unified response and strategic pivots underscore its determination to preserve national integrity and economic prosperity.

Notable Quotes:

• Matina Stivas Gridneff ([00:52]): “It feels like the vibe is changing and I am here to do a vibe check.”

• Matina Stivas Gridneff ([04:07]): “Canada could then become the 51st state and that Trudeau could be governor.”

• Matina Stivas Gridneff ([10:22]): “Elbows up, folks.”

• Matina Stivas Gridneff ([10:32]): “Ladies and gentlemen, Canada will never bend. We will never kiss the gangster's ring.”

• Matina Stivas Gridneff ([12:19]): “I think it's all of the above. It's anger. It's betrayal.”

• Matina Stivas Gridneff ([14:33]): “Anti US Anti Trump sentiment is basically doing huge favors to the Liberal Party, even rehabilitating the image of Justin Trudeau.”

• Matina Stivas Gridneff ([24:55]): “It does feel kind of permanent.”

• Kim Severson ([01:57]): “I don't think we'll ever be the same as friends.”

Final Thoughts

This episode of The Daily offers a comprehensive exploration of the multifaceted impact of the Trump administration’s trade policies on Canada. Through insightful interviews and expert analysis, listeners gain a nuanced understanding of the economic, political, and cultural transformations spurred by this international conflict. As Canada grapples with redefining its trade relationships and national identity, the resilience and adaptability of its people and leadership will be crucial in shaping the nation’s future amidst global uncertainties.

Transcript

[Kim Severson]

This podcast is supported by NetSuite.

[Matina Stivas Gridneff]

Okay, business leaders, are you here to play or are you playing to win? If you're in it to win, meet your next mvp. Netsuite by Oracle. Netsuite is your full business management system in one convenient suite with NetSuite, you're running your accounting, your finance, your HR, your E commerce, and more, all from your online dashboard. Upgrade your playbook and make the switch to NetSuite, the number one cloud ERP. Get the CFO's guide to AI and machine learning at netsuite.com NYT netsuite.com NYT this is Daily producer Michael Simon Johnson. I am in downtown Toronto because things are getting real here in Canada.

[Kim Severson]

Okay, Anna Holy here producer on the Daily I have just touched down in Winnipeg and Manitoba, Canada.

[Matina Stivas Gridneff]

It feels like the vibe is changing and I am here to do a vibe check.

[Kim Severson]

How would you describe how you're feeling about what's going on between the US And Canada right now? Canadians have always been known as nice people. We turned the other cheek. We've been kind of backed into a.

[Matina Stivas Gridneff]

Corner now by your president, America, Donald Trump. How can American people back this man? I don't buy any more USA products, just buy Canadian goods. I will not buy anything from America.

[Kim Severson]

In fact, I've told anybody and everybody.

[Matina Stivas Gridneff]

I possibly can, don't ever go down to America.

[Kim Severson]

Don't. I served in our Canadian Navy and nothing irritates me more than when somebody looks down their nose at us.

[Matina Stivas Gridneff]

I'm very, very proud to be Canadian. We were born Canadian and we will die Canadian. Who do you blame for all of.

[Kim Severson]

Us, who do we blame?

[Matina Stivas Gridneff]

The American citizens.

[Kim Severson]

I don't think we'll ever be the same as friends.

[Matina Stivas Gridneff]

Neighbor, anything from us, yo, without us.

[Kim Severson]

They can't survive regardless, eh? From the New York Times, I'm Kim Severson and this is the Daily A gloves off trade war with America is uniting Canadians from all corners of the country against its southern neighbor. Today, my colleague Matina Stivas Gridneff on what that trade war means for the future of the relationship and how this fight is shifting the country's politics, its culture, and its place on the global stage. It's Thursday, March 13th. Mattina, you've been traveling across Canada reporting on what's turned out to be a very big Newsweek. Thank you for taking the time to come on the show.

[Matina Stivas Gridneff]

Thank you so much for having me, Kim.

[Kim Severson]

So coming into his presidency, I think there was an expectation that Trump might make waves on matters of international diplomacy. But I Don't think many of us had make Canadians really, really angry on their b. Oh, totally.

[Matina Stivas Gridneff]

I mean, I took up my posting as Canada bureau chief in August, and I thought this was going to be a good posting for my work life balance. Little did I know. I mean, it's been a really extraordinary stretch since the election, for sure.

[Kim Severson]

So let's rewind a little and just remind me of how we got here. You know, we're at a place where Canadians who, you know, to many Americans seem very, very nice, have turned downright hostile and find themselves in such a political vice.

[Matina Stivas Gridneff]

Sure. I mean, I think the first signs that something was going to go wrong emerged in early December when Prime Minister Justin Trudeau flew to Mar a Lago to sit down for dinner with President Elect at the time, Trump. And the dinner, you know, was feeded as a success for Trudeau to be able to get FaceTime with Trump. And it seemed cordial enough. There were like photos of everyone smiling, smiling and jokes.

[Kim Severson]

And tonight we're getting some new details about that Trump Trudeau dinner from two people who were at the table.

[Matina Stivas Gridneff]

But it does sound like that's when Trump sort of started raising complaints about the U.S. relationship with Canada. Fox News is reporting that Trudeau warned Trump that his tariff proposal would kill the Canadian economy, to which Trump replied that Canada could then become the 51st state and that Trudeau could be governor and made the supposed joke of Canada becoming the 51st state of the United States. That meeting did not appear to go well. The Canadian delegation brushed that off at the time. But it would come back to haunt them.

[Kim Severson]

Right. I think a lot of us did. And no one knew if it was one of the many things that he says that you don't know whether to take seriously or not, for sure.

[Matina Stivas Gridneff]

And I think that at first that was generally seen as like a troll. A lot of people thought it was quite personal to Trudeau because we knew Trump doesn't like Trudeau much from his first presidency. But I think that we started realizing it is probably something more ominous when Trump gave a press conference on January 7th.

[Kim Severson]

So thank you all for coming. We'll take a couple of questions. Yeah.

[Matina Stivas Gridneff]

And our own colleague, David Sanger of the New York Times asked him about his claims on Greenland, which is an autonomous area of Denmark, and the Panama Canal and Canada.

[Kim Severson]

Can you assure the world that as you try to get control of these areas, you are not going to use military or economic coercion?

[Matina Stivas Gridneff]

No. And he specifically asked how you're going to use force to annex These places. And Trump said, economic force, economic force.

[Kim Severson]

Because Canada and the United States, that.

[Matina Stivas Gridneff]

Would really be something. So by late January, it becomes clear President Trump is being serious about imposing tariffs on all Canadian and Mexican goods being imported into the United States. I mean, you have to remember Canada and the United States are each other's closest trading partners. The United States is a destination for about 80% of goods that Canada exports, including, for example, its oil and gas. And so this is a core existential economic relationship. And those tariffs that President Trump is threatening to slap on Canadian goods, they have the potential to derail the Canadian economy.

[Kim Severson]

Right. And we've talked on the show before about the threat of tariffs. And the way Trump justified them at the outset is that he would be using them as a way of forcing our neighboring countries to reduce both migrant traffic and drug traffic from coming into the US but these are not, seems to me, major problems at the border of Canada. So was there a sense among the Canadian government that this was about something else?

[Matina Stivas Gridneff]

Absolutely. And I think where we really came to see this, and it took some time for the reporting to come together, is over the course of two phone calls that President Trump and Prime Minister Trudeau held on February 3rd. So what happens on those calls is that President Trump lays down for Prime Minister Trudeau a number of grievances that he has with the economic and trade relationship between the two countries. These were generally well known problems or concerns on the American side. The US Wanted better access to the Canadian dairy market and the banking sector. But then President Trump raised something much more fundamental. He tells Trudeau, and apparently he's reading off a memo, according to our sources, he tells Trudeau, and I don't like the border treaty between our two countries. This is a 1908 treaty that demarcates the boundary between the two nations. And President Trump just tells Prime Minister Trudeau he thinks it's not valid and should be revisited. He also tells him he doesn't like the way the two countries share water. We know President Trump is really interested in Canada's water. He thinks Canada has too much of it. And he also raises to Trudeau that he wants to revisit water agreements between the two countries. And so sudden we go from, I don't like the way we trade and how our economies are integrated to, nice country you got there. Shame if something happened to it.

[Kim Severson]

I mean, this seems like an extraordinary moment. Here is Trump on the phone with Trudeau, essentially saying, I don't respect your borders or your sovereignty. How is the Canadian government Reacting to all this at this point, it was.

[Matina Stivas Gridneff]

Shock and anger and panic stations after that phone call. And Trudeau makes it quite clear that we're gonna hit back on US Products with our own tariffs if this threat materializes and becomes reality. And I think this is a good point to remind people. Trudeau is going through his last weeks in office. He has said he's gonna resign, and we're expecting him to be out of government by the end of March. And so he takes this quite aggressive stance, even though he's almost out of government.

[Kim Severson]

And now, as Canadians face from our neighbour an existential challenge, an economic crisis, Canadians are showing exactly what we are made of.

[Matina Stivas Gridneff]

And he gives one important speech when we still think these tariffs are going to be leveled against Canada. Freedom is not a given. Even Canada is not a given. None of those happen by accident.

[Kim Severson]

None of them will continue without effort.

[Matina Stivas Gridneff]

Sort of quite emotionally, he says, we didn't ask for this fight, but we will stand up for our country. We're a country that will be diplomatic.

[Kim Severson]

When we can, but fight when we must.

[Matina Stivas Gridneff]

Elbows up. And I think that's a speech that really galvanizes people. Elbows up, folks.

[Kim Severson]

Elbows up time.

[Matina Stivas Gridneff]

It means we're about to fight. They say elbows up. Borrowing a term from hockey and showing that they want to defend their country.

[Kim Severson]

Ladies and gentlemen, Canada will never bend. We will never kiss the gangster's ring.

[Matina Stivas Gridneff]

The public is really reacting very organically.

[Kim Severson]

War is officially on. So if you're Canadian, now more than ever, it's so important to be shopping Canadian products.

[Matina Stivas Gridneff]

We're seeing by Canadian signs, grocers are putting up flags to tell consumers which products are made in Canada so that they can prefer them over American products. Having my coffee, it is not Folgers. I'm done with Folgers.

[Kim Severson]

It is now Canadian coffee.

[Matina Stivas Gridneff]

I mean, it was remarkable to watch this anger become a visible thing. Seeing anti Americanist feelings foments. And we start hearing something, I mean, truly remarkable. Canadians booing the American national anthem in hockey games. And while we're on the topic of hockey, folks are even angry with Gretzky, who's like a national hero here. He's like a symbol.

[Kim Severson]

Wayne Gretzky, the big Canadian hockey hero, right?

[Matina Stivas Gridneff]

Absolutely. Well, also a close friend of Donald Trump. And so he suddenly has this fall from grace, and Canadians are treating him like a traitor. So these feelings are just really brewing, are very powerful. They're finding expression in various ways across Canadian society. This is not like a minority situation.

[Kim Severson]

I don't really want to play Canada's therapist here. But what's behind the reaction? Is it defiance? Is it betrayal? I mean, what do you think is unifying the Canadians at this point?

[Matina Stivas Gridneff]

I mean, I think it's all of the above. It's anger. It's betrayal. Betrayal by a friend hurts so much more. And from the political elite of the country all the way down to the street and ordinary Canadians, the nation is going through a range of emotions. Anger, fear, insecurity. And I think it goes beyond being just a moment. It has the potential to alter the course of Canadian history. And we're already seeing the first sign of that.

[Kim Severson]

We'll be right back. This advertisement is paid for by the American Petroleum Institute.

[Matina Stivas Gridneff]

US Energy production, especially from government leased areas, benefits Americans. This is Dolores Story. We have oil and gas. The royalties that we get helps our family, helps our children to go to school.

[Kim Severson]

Sometimes they'll get emotional. Our livelihood is at stake. We just need to be heard.

[Matina Stivas Gridneff]

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[Kim Severson]

The International Rescue Committee. When conflict and disaster strike, the IRC is ready to help families immediately after an emergency occurs and long term with health care supplies, clean water and other critical aid. As crises continue in Gaza, Ukraine, Sudan and around the world, the IRC is committed to ensuring families can survive, recover and rebuild their lives. For a limited time, all donations are doubled to help the IRC meet this moment of unprecedented need. Make your matched [e-mail] rebuild. Matina, you were telling us that what's happening in Canada in response to the trade wars and to the intense rhetoric coming from the Trump administration was beginning to change Canada in some extremely significant ways that really have long term implications. Can you tell me what you mean by that?

[Matina Stivas Gridneff]

Well, Kim, back in January when this problem was gathering pace, Justin Trudeau was resigning. His party. The Liberal party, who have been in power for nearly 10 years, were facing dismal polls. They were 20 plus percentage points behind the opposition, the Conservatives led by Pierre Polievre. And in the federal elections looming, it was sort of a foregone conclusion that the Conservatives were going to win. Poiev was going to be the new prime minister. He had these ideological and stylistic affiliations to the magamous movement and the sort of more right wing populist movement. And that was kind of what was gonna happen in Canadian politics. But things started to rapidly change just as Trump escalated his menacing rhetoric about Canadian sovereignty and went ahead with his tariff threats. Something, I mean, truly remarkable happens. And I spoke to pollsters. One of them, really, a really seasoned pollster, told me that he's never seen this in his entire care. We go from the Liberal Party's dead, and they're going to be going into political exile for a long, long time to this Liberal revival. The anti US Anti Trump sentiment is basically doing huge favors to the Liberal Party, even rehabilitating the image of Justin Trudeau to a certain extent, who was loathed, to the extent that he had to resign in early January. Right. And so it sets the scene for a stunning and pretty rapid reversal of fortunes for the Liberal Party as it goes into a leadership race to elect its new leader, the person who's going to replace Justin Trudeau as party chief and as prime minister.

[Kim Severson]

So what happens?

[Matina Stivas Gridneff]

Well, the party rallies in a dramatic way around one candidate. His name is Mark Carney. Mark Carney is not a politician. He's a political novice who hasn't held elected office, but has been in the public eye for many, many years, really his entire career. He was the governor of the bank of Canada during the global financial crisis of 2008, and then he went on to become the governor of the bank of England during Brexit.

[Kim Severson]

So Canadians know him as a solid economics policy guy, for sure.

[Matina Stivas Gridneff]

But people point out that Carney is not a natural born politician. He's not oozing charisma. I think when he started his campaign in January, polling showed one in three Canadians only could recognize his photo, could name who he was, and nonetheless, the moment he's in and the anti Trump sentiment, the fear and concern Canadians are feeling, and the anger just turbocharges his campaign. So people are looking to Carney as someone who can potentially make a deal with Trump, but also steer the country through what will be a challenging economic period. People think he knows what he's doing, but Carney has a huge challenge in his hands, and that's that he has to be campaigning for his job as Prime Minister while being prime minister. He's expected to get sworn in any day now.

[Kim Severson]

Okay, can you remind me how this works? So he's serving as prime minister, and then he has to run fairly soon again as prime minister. Can you just give me the little Canadian Parliament 101?

[Matina Stivas Gridneff]

Absolutely. It is a little complicated, but Canada has a sort of parliamentary system where the leader of the party in power is the prime Minister. And so Mr. Carney. Carney has been elected as leader of the Liberal Party. And so he will be sworn in as Prime Minister. But by Canadian political rules, the country needs to hold an election by October. And so our expectation, and Mr. Carney's campaign has indicated this, is that he will call for a federal election really early on after he's sworn in, and seek to capitalize on his momentum to get a mandate at a national level from Canadians.

[Kim Severson]

That seems kind of head spinning. So he's got to ride the momentum. Right. But he also has to be kind of avoiding an all out trade war with Trump. Cut a deal, still look like he's standing up to Trump. This seems like an incredible needle to try to thread.

[Matina Stivas Gridneff]

I agree. I think it's a really difficult balancing act. Hello. Bonsoir tout monde.

[Kim Severson]

Wow.

[Matina Stivas Gridneff]

In his acceptance speech of the leadership, Mark Carney was barely celebratory, Frankly.

[Kim Severson]

The Americans want our resources, our water, our land, our country.

[Matina Stivas Gridneff]

Think about it. If they, if they succeeded, they would destroy our way of life. He made like a wartime speech and he was clear that he was going to be very aggressive against the United States.

[Kim Severson]

My government will keep our tariff on until the Americans show us respect.

[Matina Stivas Gridneff]

That was like a really striking moment. But at the same time, he's going to have to deal with President Trump. And that kind of rhetoric doesn't play very well with President Trump.

[Kim Severson]

So what about poev? I can imagine that being a right wing populist who is compared to Trump is suddenly not a great thing to be in Canada.

[Matina Stivas Gridneff]

That's right. I think that Pierre Polievre is not Trump, but his detractors here in Canada call him Maple maga. That's kind of the slur they use against him. And even though many of his policies are pretty sort of mainstream, vanilla, moderate conservative policies, he does borrow from the MAGA playbook. And so that is not a great situation to be in when your country suddenly turns against President Trump and everything he stands for in such a huge and visceral way.

[Kim Severson]

Is he trying to put distance between himself and Trump? Has he shifted his campaign?

[Matina Stivas Gridneff]

Well, the Conservatives are really trying to stage a pivot. They still have a solid chance at winning the federal election when it happens. According to polls, they're sort of neck and neck with Carney and the Liberals, but their leader has to just do a whole new thing now. So what they're doing, they are really distancing themselves from President Trump, saying that the rhetoric and the threats coming out of the White House are not what they believe in. They're gonna stand up to President Trump. And recently President Trump gave an interview to a British magazine and he Said, oh, I'm not so sure what I think about this Poliev guy in Canada. He's not a MAGA guy. And boy, did Pierre Poliev grab that opportunity. He, the president says that he doesn't like me. He doesn't think that I'm a MAGA guy. I am not. It is true that I am. Canada first says, You're right, Mr. President. I'm not a MAGA guy. I'm a Canada first guy. And if that upsets foreign leaders, including the American president, I'm fine with that because I have one job to do is to fight for this country. We will never be the 51st state, and I will always stand up for our flag and our people. So the opposition party, the Conservatives, need to sort of reinvent themselves, frankly, more close to the center to have a fighting chance in the elections. So it's a kind of odd moment of political consensus in a country that was five minutes ago going through this incredibly polarizing political situation.

[Kim Severson]

Are either of these candidates articulating what the future of Canada would look like? Are they talking about what would happen if the United States isn't at play anymore?

[Matina Stivas Gridneff]

Absolutely, Kim. And I think that's just been something really interesting to observe. There's clearly an existential crisis happening with the Canadian economy, and this huge breakdown in the relationship with the United States is driving it home. So both candidates in both parties are talking a lot about what a future of a successful Canada would look like diversifying away from the United. And part of the reason they want to be doing this urgently is that the situation with the tariffs from the United States is like shifting sands. The one day it's going to be 25% on everything. The next day that's canceled, but it's going to be 50% on steel. And so this is a very destabilizing situation for the Canadian economy. And Canada doesn't have a lot of other customers. They sell most of their stuff to Americans, and that's why they're looking much more towards Europe. I mean, half of Canadians, according to a recent poll, want to even join the European Union.

[Kim Severson]

That's amazing.

[Matina Stivas Gridneff]

Wow. I know. That's how far this is going. But they're also looking to improve other relationships. Right now, they're in a really tough spot with China, which is another top trading partner. The Chinese have imposed tariffs on Canada, sort of trying to squeeze them, not to cut a deal with the United States on tariffs and trade. And so they're finding themselves in a really difficult position when they need to strategically rethink their global economic and trade links. And both the Liberals and the Conservatives are casting a wider net around the world for new best friends.

[Kim Severson]

Matina, in any good relationship, trust is essential. So in this relationship between the United States and Canada, let's say Trump goes back on the tariffs, decides that he wants things back to the way they were with Canada, can the relationship be put back together again?

[Matina Stivas Gridneff]

I mean, I think obviously the breach of trust and the uncertainty has already caused a lot of damage even economically. You know, there's been market volatility, investment has been frozen. And so folks are already hurting financially here in Canada. And of course, it goes deeper than that. There's a break in trust that feels really meaningful right now. It does feel kind of permanent. But it is conceivable that in the future there could be perhaps different leaders on both sides. Sides. And those fences could be mended, but it will be on new terms. What I'm seeing here in Canada is a really energized willingness to redefine what it is to be Canadian both at home and on the world stage through new economic relationships and more defined cultural references, too. I think even if this episode were to just sort of end tomorrow, it would still have a lasting legacy of seeing a more clear, a more assertive, and a prouder, more Canadian Canada.

[Kim Severson]

Mattina, as always, thank you.

[Matina Stivas Gridneff]

Thank you, Kim.

[Kim Severson]

On Wednesday, hours after Trump's global tariffs on steel and aluminum took effect, the Canadian government retaliated with new tariffs on $20 billion of U.S. imports. That came as the European Union also hit back with new levies against American goods. Trump, who earlier this week declined to rule out the possibility that his economic policies would cause a recession, vowed to respond, saying, quote, of course I'll hit back. We'll be right back.

[Matina Stivas Gridneff]

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[Kim Severson]

Here's what else you should know today. In what the Trump administration is calling the largest deregulatory announcement in American history, the Environmental Protection Agency Wednesday said it would unwind dozens of regulations, among them protections for wetlands and limits on how much soot can pour from smokestacks. Most significantly, the administration plans to erase the EPA's legal authority to regulate carbon monoxide and other greenhouse gases by reconsidering decades of science that highlight the dangers of global warming. Today's episode was produced by Shannon Lynn, Nina Feldman, Michael Simon Johnson and Anna Foley with help from Alex Stern and Stella Tan. It was edited by Chris Haxel and Devin Taylor with help from MJ Davis. Lynn contains original music by Dan Powell and Marion Lozano and was engineered by Alyssa Moxley. Our theme music is by Jim Brumberg and Ben Landsberk of Wonderly. That's it for the Daily I'm Kim Severson. See you tomorrow.

[Matina Stivas Gridneff]

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