WASHINGTON—President Donald Trump announced Tuesday that he will double planned tariffs on steel and aluminum imports from Canada, raising them from 25% to 50%. The move, set to take effect Wednesday, intensifies trade tensions between the U.S. and its northern neighbor amid growing concerns about economic stability.
Trump justified the tariff hike as a response to Ontario’s recent increase in electricity prices for power sold to the U.S. In a post on Truth Social, he wrote, “I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD.”
The announcement follows a brutal stock market selloff on Monday, with further volatility on Tuesday. Critics argue that Trump’s tariff strategy risks exacerbating economic instability, as investors had anticipated a business-friendly approach based on deregulation and tax cuts rather than aggressive import taxes.
Trump has provided shifting explanations for his stance against Canada, citing concerns over fentanyl smuggling and high Canadian tariffs on dairy imports. He has also continued to suggest that Canada should become part of the United States, a remark that has drawn sharp criticism from Canadian officials.
“The only thing that makes sense is for Canada to become our cherished Fifty First State,” Trump posted Tuesday, a statement that further inflamed tensions with Canadian leaders.
Ontario Premier Doug Ford, speaking on MSNBC, condemned Trump’s move, warning of economic consequences. “If we go into a recession, it’s self-made by one person. It’s called President Trump’s recession,” Ford said. “It shouldn’t be this way. We should be booming, both countries.”
Trump also criticized Canada’s electricity policy, vowing in another social media post that the country “will pay a financial price for this so big that it will be read about in History Books for many years to come!” Ontario supplies electricity to states like Minnesota, New York, and Michigan, and Trump has pledged to declare a national emergency in those states in response.
The president’s aggressive trade stance extends beyond Canada. He has imposed 25% tariffs on Mexico, citing concerns over drug trafficking and illegal immigration, although he temporarily suspended tariffs on imports compliant with the 2020 USMCA trade pact. Asked if Mexico feared facing the same 50% steel and aluminum tariffs as Canada, Mexican President Claudia Sheinbaum responded, “No, we are respectful.”
Trump was scheduled to address the Business Roundtable on Tuesday, a trade association of top CEOs that he courted during the 2024 campaign with promises of corporate tax cuts. However, his sweeping tariffs—including potential new levies on Europe, Brazil, South Korea, pharmaceutical drugs, copper, lumber, and computer chips—could represent a significant tax increase on businesses.
The financial markets have reacted negatively to Trump’s tariff policies, raising concerns about a possible economic downturn. Harvard economist and former Treasury Secretary Larry Summers put the odds of a recession at 50-50, warning that tariffs have fueled inflation while undermining economic confidence.
“All the emphasis on tariffs and all the ambiguity and uncertainty has both chilled demand and caused prices to go up,” Summers posted on X. “We are getting the worst of both worlds—concerns about inflation and an economic downturn and more uncertainty about the future, and that slows everything.”
Credit: AP
