How Canada & Mexico Respond To Trump's Tariffs

Summary

Summary of "How Canada & Mexico Respond To Trump's Tariffs" – NPR Politics Podcast

Release Date: February 11, 2025
Hosts: Asma Khalid and Susan Davis
Guest Correspondents: Jackie Northam (Canada), Eyder Peralta (Mexico)

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Introduction

In this episode of The NPR Politics Podcast, hosts Asma Khalid and Susan Davis delve into the ramifications of President Donald Trump's recent imposition of a 25% tariff on all steel and aluminum imports into the United States. This move, which includes traditionally allied neighbors Canada and Mexico, marks a significant escalation in trade tensions. The hosts explore the responses from both nations and analyze the broader implications for U.S. foreign policy and economic strategy.

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Trump's Tariff Announcement

Asma Khalid opens the discussion by highlighting the gravity of Trump's decision:

“Yesterday, the president announced 25% tariffs on all steel and aluminum imports, every country, no exceptions, no exclusions, even for our neighbors, Canada and Mexico.”
[00:35]

She frames this action as part of Trump's broader agenda to “make America rich again,” setting the stage for an in-depth examination of its impact on international relations and domestic industries.

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Canada's Response

The podcast features insights from NPR correspondent Jackie Northam, who provides an on-the-ground perspective from Ottawa.

Impact on Canada: Jackie Northam explains the immediate effects on Canada, emphasizing the country's role as a major supplier of steel and aluminum to the U.S.:

“Canada is the largest supplier of both aluminum and steel to the US. It's going to have a huge impact if this does happen.”
[01:27]

Retaliatory Measures: While Prime Minister Justin Trudeau has acknowledged the potential harm to sectors like agriculture and oil, he has thus far refrained from imposing retaliatory tariffs:

“Trudeau has not said whether he is going to place retaliatory tariffs if these do go ahead.”
[01:54]

Negotiation Dynamics: Jackie discusses the interplay between Trump’s initial threats and Canada’s conciliatory actions:

“Canada agreed to announce a fentanyl czar…and a joint Strike Force team…Canadian public because they were sort of fed up with being what a lot of people think is being bullied.”
[05:27]

Public Sentiment: She notes a prevailing sense of anger and disappointment among Canadians, reflecting strain in a traditionally strong bilateral relationship:

“I was so struck by the, you know, just the depth of anger and disappointment.”
[05:27]

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Mexico's Response

Eyder Peralta provides coverage from Mexico, detailing the country's strategic approach to Trump's tariffs.

Calm and Calculated Response: Mexico's President Claudio Sheinbaum has opted for a measured reaction, avoiding immediate retaliation:

“Mexico's response will be cool headed. … we're not going to enact retaliatory tariffs unlike Canada.”
[08:06]

Economic Interdependence: Eyder underscores the intricate economic ties between the U.S. and Mexico, highlighting the complexity of imposing tariffs:

“The pistons that go in cars… that same piston goes into Canada and then to Mexico and then back into the U.S.… Are we going to put tariffs on this piston eight times?”
[08:06]

Strategic Patience: Mexico is banking on the interwoven nature of North American supply chains to discourage the effective implementation of sweeping tariffs:

“They want to have phone conversations… explain to Trump just how complicated and impossible possible this would be for him.”
[08:06]

Consistency in Policy: Reflecting on past interactions, Eyder mentions that Mexico maintains similar immigration and border policies as under the Biden administration, despite Trump's aggressive rhetoric:

“Claudia Sheinbaum said… Mexico is going to wait for Trump's cabinet to get settled and that they just want to have phone conversations.”
[10:11]

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Analysis and Insights

Use of Tariffs as Negotiation Tools: Susan Davis offers a comprehensive analysis of Trump's tariff strategy, suggesting it serves multiple purposes beyond immediate economic protectionism:

“Trump is using tariffs as a bit of a sledgehammer… He is convinced that tariffs will increase revenue for the United States of America.”
[12:19]

She distinguishes between the initial tariffs aimed at immigration and drug policies and the later focus on economic realignment of industries like steel and aluminum.

Political Ramifications: Davis cautions about the potential domestic backlash from rising consumer prices:

“There is a great sense of uncertainty in the US Economy… tariffs do create a great sense of uncertainty.”
[12:19]

She highlights concerns among policymakers about explaining how tariffs will offset tax cuts and sustain economic growth.

Strategic Limitations: Both correspondents touch upon the challenges of sustaining such tariff policies without causing significant disruptions to the U.S. economy:

“The US gets about half of its imported oil… they have a weakened hand because we get a ton of our produce from Mexico.”
[14:15]

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Conclusion

The episode concludes with the hosts reflecting on the precarious balance between enforcing nationalist economic policies and maintaining harmonious international trade relationships. While Canada and Mexico exhibit differing responses—Canada showing signs of frustration and Mexico maintaining a strategic restraint—the overarching theme underscores the complexity of unilateral tariff implementations in a globally interconnected economy.

Asma Khalid wraps up by emphasizing the ongoing nature of these developments and the critical need to monitor how these tariffs will evolve:

“We will be keeping an ear out on what develops on the tariff front.”
[15:11]

This comprehensive discussion offers listeners a nuanced understanding of the immediate and potential long-term effects of Trump's tariff policies on North American relations and the broader geopolitical landscape.

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Notable Quotes with Timestamps:

• Susan Davis on Canada’s Position:

  “Canada has been put on its back foot a little bit since Trump took office.”
  [03:46]

• Jackie Northam on Public Sentiment in Canada:

  “I was so struck by the, you know, just the depth of anger and disappointment.”
  [05:27]

• Eyder Peralta on Mexico’s Economic Strategy:

  “Take a look at pistons… Are we going to put tariffs on this piston eight times? What would that do to car prices?”
  [08:06]

• Susan Davis on Tariffs as a Multi-Pronged Tool:

  “They absolutely are [tariffs as a negotiation tactic].”
  [12:19]

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This episode of The NPR Politics Podcast provides an insightful exploration of the intricate dance of tariffs and retaliations between the U.S. and its neighbors, Canada and Mexico. Through expert analysis and on-the-ground reporting, listeners gain a clear picture of the current trade climate and its implications for the future.

Transcript

[Grant]

Hi, this is Grant and Emily from Denver, Colorado. And we are driving back from a 24 hour rock climbing competition in Jasper, Arkansas. This podcast was recorded at 12:44pm Eastern.

[Asma Khalid]

Time on Tuesday, February 11th of 2025.

[Grant]

Things may have changed by the time you hear it, but our fingers and toes will still be recovering. Okay, here's the.

[Susan Davis]

I'm cold just listening to that.

[Asma Khalid]

Hey there. It's the NPR Politics podcast. I'm Asma Khalid. I cover the White House.

[Susan Davis]

And I'm Susan Davis. I cover politics.

[Asma Khalid]

And today on the show, Trump tariffs are back. It's a big deal. It's a big deal. This is the beginning of making America rich again. Yesterday, the president announced 25% tariffs on all steel and aluminum imports, every country, no exceptions, no exclusions, even for our neighbors, Canada and Mexico. And this all comes after Trump had threatened, threatened and then pulled back from sweeping tariffs on Canada and Mexico. So today on the show, we want to hear how our neighbors are reacting. And lucky for us, we have got a stellar group of international correspondents that we can call up. And we're going to start up north with NPR correspondent Jackie Northam, who is just in Canada's capital, Ottawa. Hey there, Jackie. Thanks for joining us.

[Jackie Northam]

Hey, thank you very much for having me.

[Asma Khalid]

Jackie, how is Canada responding to this latest news from President Trump?

[Jackie Northam]

Well, Prime Minister Justin Trudeau mentioned to Vice President J.D. vance that this was going to hurt his home state of Ohio. Canada is the largest supplier of both aluminum and steel to the US it's going to have a huge impact if this does happen. However, Trudeau has not said whether he is going to place retaliatory tariffs if these do go ahead, unlike earlier tariffs that Trump had said he was going to put on all Canadian products.

[Asma Khalid]

Yeah, Jackie, I want to ask you about that because there was a lot of back and forth a couple of weeks ago where Trump threatened, you know, widespread tariffs on Canadian goods that would come into the United States. And I recall Justin Trudeau said, well, then Canada will retaliate.

[Jackie Northam]

Yeah, sure did. He said it was going to be the same 25% tariffs on a wide range of U.S. goods, up to $100 billion worth. And so that would be, you know, U.S. cars or plastic, alcohol, any sort of beer and bourbon, household products as well. And the reason that he did that because tariffs that Trump was threatening to slap on Canada, which are still in place, they're just being suspended for now. We don't know if they're going to be, you know, come back again or not. But this was really hitting Canada hard. You know, it was affecting, you know, agricultural products, lumber and paper products, but also things like potash that's used for fertilizer. They were also. Canada was also facing 10% tariffs on crude oil. Now, if you think about it, the US Gets about half of its imported oil. So these were really digging deep. And so that's why Trudeau turned around and said, right, we're going to hit back as hard as you're hitting us. And to be honest, he had the really just broad backing by the Canadian public because they were sort of fed up with being what a lot of people think is being bullied by the.

[Asma Khalid]

U.S. sue, these broad tariffs that Jackie was describing, as she mentioned, they are suspended for now. They could come back. Right. We don't really know what's going to happen on those across the board tariffs. But to me, this is interest because Canada is a longtime ally of the United States. I mean, the countries share the largest undefended border in the world. And so by acting this way toward a major ally, it seems like President Trump is signaling that foreign policy is just a far more transactional process for him than it has been in previous administrations.

[Susan Davis]

You do get the sense that Canada has been put on its back foot a little bit since Trump took office. I think that Mexico was prepared for a more contentious relationship with the White House. But I don't know if Canada really saw this coming. I will say broadly, I don't think anyone should be surprised by this. If there was anything that Trump talked about more consistently on the campaign trail and has seen the most committed to in the entirety of his political lifetime is the idea of tariffs. And I think these two specific types of tariffs, I think illuminate how Trump sees them in two different ways. I think that the initial tariffs that he'd announced against Canada and Mexico were a big bit of a stick. It wasn't about the economy. It was about getting these countries to respond to immigration and drug policies. And frankly, they did. So I think that there are a lot of Trump allies that look at his efforts on tariffs and say, look, it gets people to the table and it gets people to enact policies they might not otherwise enact if he wasn't so threatening. On the steel and aluminum front, I think these are a little bit different. I think that this is much more aligned with Trump's economic vision and that he's trying to right size certain US Industries, like the US Steel industry, which the industry itself is celebrating the tariffs, if not domestic manufacturers. I don't think it's a negotiating tactic. I think it's economic policy. And so it doesn't seem to me that those would be as likely peeled back. It seems like the steel and aluminum tariffs could be here to stay.

[Asma Khalid]

Jackie, there's one thing, though, that sue just said I want to ask you about, and that is the idea that the initial overture from Trump around broad based, sweeping tariffs, that it worked in eliciting some sort of response from Canada. From your vantage point, from your conversations with the people and politicians in Canada, did it work?

[Jackie Northam]

At the end of the day, the difference was between when he said he was going to do it and when he said he was going to postpone the tariffs. Two things happened. One is that Canada agreed to announce a fentanyl czar. And this is really an American term czar. You wouldn't hear this in Canadian lexicon. Right. It's just not there. And the other thing was a joint Strike Force team meant to target money laundering and, you know, the criminal underworld and that sort of thing. Other than that, Canada had everything else in place already, over a billion dollars to beef up its border security, things like that. So I'm. We're not really sure what the difference was between he said he was going to implement them and until he said he was just going to hold off for a month, just those two things. So it really leaves a lot of Canadians wondering, what was this about? You know, I was just up there on a trip. I was so struck by the, you know, just the depth of anger and disappointment.

[Asma Khalid]

Sue, given that ill will that Jackie has described, what is the off ramp here? I mean, these two countries, Canada, the United States, have economies that are deeply intertwined. Is there an off ramp here?

[Susan Davis]

It certainly doesn't seem like it. And I know it's partly Trump being Trump, but I also think the continued talk, and I think he reiterated it just within recent days of wanting to make Canada the 51st state. Obviously, that's a much more complicated process, but I think it does sort of speak to almost a bit of dismissiveness Trump has towards Canada as an ally. I think he sees their resources and their minerals as something that the US has direct interest in. And this is one small example of a bigger worldview in which I think Trump is much more antagonistic and dismissive of traditional US Allies, especially when it comes to economic terms like he just wants. He wants a better deal, even from longtime U.S. allies. And I think you're going to see this intensified because the White House is already indicating that they're looking to the European Union for more tariffs. And I think they're similar saying, like wait, why us? And it is a profoundly different economic viewpoint coming from the Republican Party. And Trump is ready to go.

[Asma Khalid]

All right. Well, Jackie Northam, thank you so much for bringing your reporting to us.

[Jackie Northam]

Thanks very much. Nice to be here.

[Asma Khalid]

And we're gonna take a quick break and when we get back, we'll have more on the reaction from our neighbor to the south Mexico. And we're back. And we're joined now by our colleague Ader Peralta, who covers Mexico for npr. Hey there Aider.

[Eyder Peralta]

Hey Asma.

[Asma Khalid]

So Ada, I also want to get the response that you are hearing from Mexico to this latest move from the Trump administration, the 25% tariff on steel and aluminum.

[Eyder Peralta]

You know, Mexico's President Claudio Sheinbaum has always said that Mexico's response will be cool headed. So this morning the president came out for her morning briefing. She basically said, everyone stay calm. We're not going to enact retaliatory tariffs unlike Canada. And you know, basically she said these tariffs on aluminum and steel are not a reality. They go into effect in March. And she said we're going to talk. She got her economy minister out and he said, look, these economies are too intertwined and so we have to find common sense. And he said that Mexico is going to wait for Trump's cabinet to get settled and that they just want to have phone conversations. And what the economy minister said is we're going to explain to Trump just how complicated and impossible possible this would be for him. And he gave a really interesting example. He said, take a look at pistons. The pistons that go in cars. For a car that is made in Michigan, those pistons would be made with U.S. aluminum. But then that same piston goes into Canada and then to Mexico and then back into the U.S. sometimes he said that piston can cross borders up to eight times. And so they're like, so what are we going to do? Are we going to put tariffs on this piston eight times? What would that do to car prices? What would that do to American consumers? And so I think the bet here in Mexico has been to hope that these economies are so integrated that Trump will eventually back down from tariffs once he thinks about the consequences of them.

[Asma Khalid]

Is that the strategy as well then that Mexico took when President Trump announced the broad sweeping tariffs that were gonna go in place on Mexican goods on February 1st? Remember, that was similar to what happened in Canada. He announced these big tariffs. There were some talks and then he pulled back. But was Mexico's reaction, similar at that time.

[Eyder Peralta]

It was exactly the same. And the first tariffs that President Trump announced, he would place 25% tariffs on everything coming out of Mexico. That's a huge deal because Mexico has become the number one trading partner for the United States. So it's billions of dollars on all sorts of things, right? From limes and avocados to computer screens to the cars you drive. Mexico took the exact same tact on the day that President Trump announced those tariffs. Claudia Scheinbaum said, we have retaliatory measures ready, but I'm going to wait to talk to President Trump. That next morning, she talked to President Trump, she came out to the nation and said these tariffs have been postponed. And this, this is the playbook, actually that Mexico used during its first term. And basically what they've learned and they've told Mexicans this, right, is that we're not going to take on Trump in the sort of same aggressive manner that he takes with us. And so far, that seems to be working.

[Asma Khalid]

Eyder. The way that these negotiations were presented to us, those of us who cover the White House, is that President Trump wanted changes from Mexico on Immigran and that he got changes on immigration. Did he from Mexico?

[Eyder Peralta]

I don't know. I think it's a bit of a sleight of hand right now. Mexico is not doing anything that it wasn't doing when Biden was in office. I mean, Mexico, when Biden was in office, had sent troops to the border. It allowed the US to deport non Mexican migrants to Mexico. You know, we've been hearing a lot about raids and all these military planes shipping migrants back to their country. But the Mexican government says that they haven't seen a significant uptick in deportations since Trump took office. So, I mean, in a lot of ways, Mexico's relationship with the United States is the same. They're doing sort of the same things. But what we're getting is a much more aggressive language coming from US Leadership.

[Asma Khalid]

Sue, do you see these threatened tariffs as a negotiation tactic from the Trump administration?

[Susan Davis]

Yeah, I mean, they absolutely are. And again, I think that this is where I say you have to look at tariffs as a multi pronged tool for Donald Trump. I think that they will likely come back if immigration outcomes are not achieved on the immigration front. I think that that is a direct response to the election. And Republicans on Capitol Hill see this as sort of their number one legislative priority. They're trying to put together budget resolution this week that will allow them to spend much more money to send to the US Border. And I think that this is going to be a repeat throughout this administration, administration. And again, separately on the economic front. I think he sees it as a tool there. And I will say that, like, Trump is not entirely alone here. It was interesting to me that Debbie Dingle, who's a Democrat from Michigan, she said, like, look, tariffs are a tool and we should think about using them as a tool. I think where the discomfort comes from is that Trump is using them as a bit of a sledgehammer and they'd like more of a scalpel approach. And she also said the trade agreement between the U.S. mexico and Canada was recently renegotiated under Donald Trump. Right. And she's saying, like, look, maybe we don't need to be doing this. The United States doesn't need to be doing this with like scattershot tariffs. They need to renegotiate this broader trade agreement between these allies to get a better deal for the U.S. like, do it, do it as a big structured reform versus a really unpredictable strategy, especially because tariffs do create a great sense of uncertainty in the US Economy. I would also say too, that Donald Trump is convinced that tariffs will increase revenue for the United States of America. And he is convinced, convinced that tariffs are going to be a pay for, for the tax cuts that they want to renew. And I think that's creating a bit of unease on Capitol Hill because it's a little hard economically to always explain how tariffs will increase revenues. But I, the White House has made that very clear that that's their economic strategy here. And I just don't think on this particular economic issue, he's willing to show a ton of flexibility.

[Asma Khalid]

So then, sue, just like I asked you about the dynamic with Canada, how does this end with Mexico? Is there an off ramp?

[Susan Davis]

That's a great question. I do think, economically speaking, the US Sometimes has a weakened hand because we get a ton of our produce from Mexico. And if you start instituting broad based tariffs, what's the thing that's going to go up? Grocery prices. I mean, that is almost like the easiest way for everyday Americans to start feeling those price impacts. And so I do think that while I kind of do think the US has the upper hand in negotiating these because of the size of our economy, I think that you can't be completely politically blind to the potential blowback against Trump and Republicans for rising grocery prices.

[Eyder Peralta]

And I could be terribly wrong here, sue, because I do I hear you on, on Trump being dead set on tariffs. Right? But, but I think if, if things do change between these countries and in this market, it's probably just not going to happen with the swiftness that, that we've been seeing in these first few weeks of the administration.

[Asma Khalid]

All right. Well, we will be keeping an ear out on what develops on the terror front. But, Eyder, thank you so much for joining us.

[Eyder Peralta]

Thank you guys for having me.

[Asma Khalid]

And that is a wrap from us today. I'm Asma Khalid. I cover the White House.

[Susan Davis]

And I'm Susan Davis. I cover politics.

[Asma Khalid]

And thank you all, as always, for listening to the NPR Politics podcast.