Canada imposes retaliatory tariffs on US

0:00Canadian Prime Minister Mark Carney says his government will match new US tariffs, dollar for dollar, as the trade stash between the two nations intensifies. Canada's retaliatory tariffs took effect overnight on about $20 billion worth of US goods. Meanwhile, US President Donald Trump is threatening to cut off Canadian plainmaker Bombardier from the US market unless it starts manufacturing planes within the United States. David Colin is a former US ambassador to Canada and joins me now. David, welcome to breakfast this morning. Thank you very much for having me on the air and I have to get used to the difference in time between Australia and Philadelphia. Indeed, indeed. What kind of point are we at in this trade dispute between Canada and the United States? Are we at a new low now, David? I'm not going to try to quantify, but we're obviously at a very challenging time.

1:06I think the contrast is particularly great because historically, the United States and Canada have been the best of friends and the best of allies, whether you look at it from a trade, a defense, or an intelligence perspective. So the situation where both countries find themselves to do, find themselves at such serious odds is both uncomfortable and almost unprecedented. And remind us, David, that this is not a clear cut situation with many products, components are often crisscrossing the border several times before a final product is produced. How much does that complicate what's happening right now? The trade relationship between the United States and Canada is arguably the most interconnected trade relationship anywhere in the world. And so when you're talking about automobiles, there are various statistics for this, but an automobile manufacturer in Canada,

2:09typical automobile manufacturer in Canada may cross the border, put that in quotes effectively, nine or ten times during the manufacturing process, picking up parts and components from the United States, from Canada, and then being combined into a single vehicle. The Bombardier case that you referenced is a great one because Bombardier is a Canadian company. It is headquartered, it's global headquarters is in Quebec, but its US headquarters is in Wichita, Kansas, where they have over a thousand employees in Wichita, Kansas. And that's led the Republican Senator from Kansas to issue a strong statement objecting to President Trump's intention to ban the sale of Bombardier aircraft in the United States because of the risk that that creates for US jobs in Wichita, Kansas.

3:13The other couple other points I can make on Bombardier, which really make your point, is typical Bombardier planes have, which are manufactured in Canada, have GE engines manufactured in the United States. That's how interconnected the supply chains are. And if you look at the Bombardier, supply chain, the various companies that supply Bombardier for its manufacturing of planes in Canada, there are a few thousand American companies in that supply chain located in 47 states in the United States. That's how interconnected our supply chains are. David, from a diplomatic perspective, what's the off-ramp here? Or does this just all keep on escalating? Well, I wish I knew the answer to that, but I will tell you one thing I do know,

4:20which is there has to be an off-ramp because this can't continue to go on. The people who are getting heard, it's not President Trump, it's not Prime Minister Karney, it's not the United States, it's writ large, it's not Canada writ large. People getting heard are small and medium-sized businesses in Canada and the United States who are caught in the middle here, their employees who are whose jobs are at risk and being threatened. Communities on both the Canadian and US side of the border who are being adversely impacted by this trade war. As I have said, in a trade war, the only people being heard are small businesses and individual employees in both Canada and the United States. That can't go on, we have to find a resolution to it, but the one thing I know is you can't get to a resolution if you're not talking to each other.

5:24And for the last few weeks there have been literally no discussions or negotiations between Canada or the United States. And so to the extent I'm permitted to have an advocate of position here, my position is that it's time to put the professional negotiators back in charge. A few weeks ago, the professional negotiators, US trade representative Greer, Minister LeBlanc, US trade representative Greer from the United States, US trade representative LeBlanc from Canada, Chief Trade Negotiator, Janice Charette from Canada, were locked in a room, they were negotiating, they were making progress in these negotiations. We need to put them back in charge, go into a room, not at press conferences, they weren't calling each other names, they were just trying to dispassionately and professionally worked through the differences

6:27of opinion between the two countries. Again, I think we need to put them back in charge and leave it to them to come to a resolution that is fair for both countries. David Cohen, I thank you for your analysis, so thank you very much. Thank you for having me out.