Canada’s story is a cautionary tale for the Western world
The upcoming election is marked by the trade war with the US. However, tariffs are not the answer to the real challenges facing the country.
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Imagine walking into a government owned and operated liquor store in search of your favorite American bourbon only to find it no longer available. Instead, there is a sign that reads:
This exact slogan also appears on the Liquor Control Board of Ontario (LCBO), the organization responsible for oversight and control of alcohol sales within Ontario, a province holding almost half the population of Canada.
What may have started as Trump simply «poking the bear» with talks of making Canada the 51st state has escalated to a Trade War with the US, implementing a new 25 percent tariff on a wide array of goods from lumber to maple syrup.
Similarly, “retaliatory tariffs” are now levied on US goods entering Canada; and so the US-Canada trade war has begun. Banning US alcohol sales are just one of the myriad spillover effects. Of course, few seem to ask the question: What if a Canadian wants US goods, such as bourbon? The response is lacking, not only from economists in Canada but also from the two main candidates in the upcoming April 28th election, Mark Carney from the governing Liberal party and Pierre Poilievre from the Conservative party.
Canada’s problem is twofold, applicable to Europe and the rest of the world at large; viz., a notable lack of understanding and/or desire to embrace Austrian Economics, praxeology, or any notion of capitalism and what a free and unhampered market can achieve.
In Canada, when the Liberal party is compared to the Conservative party, there exist far too many similarities than one would anticipate. The most glaring issue is that of the pro-tariff stance. Both parties have presented fiscal platforms that unapologetically prioritize increased spending in conjunction with tax reductions, leaving a notable ambiguity regarding their funding sources. The distinctions between them appear starker in the realm of cultural ideology, with the Liberal party continuing to embrace a “woke” ideology, supported by traditional left-leaning media outlets such as the government-owned Canadian Broadcasting Corporation (CBC). The Conservatives are vocal about defunding the CBC; which naturally makes for an uphill battle in how the CBC portrays the party.
Despite a poll by Canadian newspaper “National Post” (2024) that states 60 percent of Canadians feel immigration is too high; one would be hard pressed to find either candidate having tangible solutions. Not only that, as reported by the CBC, Carney recently unveiled a plan to build 500 000 homes. An unfathomable number surely, but even more unknown than the where, when, how, and why, is “who” exactly will fill them?
Like those in Europe, Canada’s leaders and economic intelligentsia are operating sans a clear economic rationale. Having demonstrated a lack of understanding of human action, the power of the individual, and the importance of maximizing society’s wealth by allowing individuals to act freely, the country remains crushed under the weight of socialist ideology regardless of party lines.
The best response to tariffs: Do nothing
In the case of tariffs, the Austrian Economist can elucidate the issue clearly. A tariff is a tax on its own people, hence, a tariff war is akin to hurting the enemy by shooting oneself in the foot.
«A tariff is a tax on its own people, hence, a tariff war is akin to hurting the enemy by shooting oneself in the foot.»
For example, examining the issue from a US perspective: Assume Canadian lumber costs 100 US dollars and US lumber costs 110 dollars. When Trump imposes a 25 percent tariff, Americans have to buy Canadian lumber at 125 dollars. This fails to consider that so long as US producers increase lumber prices to 124 dollars, US lumber will still be cheaper; in fact, the tariff ensures this to be the case since it’s legally impossible to get Canadian lumber for less than 125 dollars. All incentives to lower prices for US producers suddenly go out the window.
This also ignores that price is not the only factor people consider when purchasing goods. It may be that Canadian lumber is of higher quality and more desirable. Americans will now be required to consider purchasing the same Canadian goods at a higher cost. Understanding that US tariffs are a disastrous self-imposed policy, the logic is clear: Canada should not follow suit.
Neither of the main political parties shows the most basic understanding of the tariffs. Neither do the CBC and academia. Naturally, the best way Canada could have responded to the Trump tariffs would be the simple, free market approach: Do Nothing. If Trump wants to tax Americans on their imports, that’s fine. But this says nothing and should have no bearing on what Canadians should import.
While Trump’s poking of Canadians has done wonders to stir the populace and make Canada’s upcoming election about US-Canada relations, a glaring missed opportunity remains. In a saner world, Canada should be unveiling its own Department of Government Efficiency (DOGE). (In Canada it would be called a Ministry; but the idea is the same.) So far DOGE claims to have saved 140 billion dollars. The inquisitive mind must realize the problems DOGE is uncovering are not unique to the USA, but speak to a systemic issue, i.e., a pro-Global socialist agenda requiring tax dollars to fund projects like “spreading atheism all over the globe”.
«In a saner world, Canada should be unveiling its own Department of
Government Efficiency.»
A new wave of socialist policies
Lastly, a perhaps unforeseen issue emerged. In the initial months following Trump’s return to the presidency, there was a swift reversal of woke policies and diversity, equity, and inclusion (DEI) initiatives. Simultaneously, the left-leaning media and the Democratic Party maintained its strong opposition to the multi-billion-dollar cost-saving measures identified by DOGE. A sense of burgeoning liberty and freedom appears to be taking hold, potentially positioning the USA to lead a global movement.
However, the introduction of tariffs has ushered in a renewed wave of national protectionism. This approach is anathema to the principles of a free market, echoing historical socialist policies that ultimately culminated in the devastating events of the 20th century. With the Canadian election just weeks away, the prospect of Mark Carney, a central banker and known World Economic Forum (WEF) affiliate who seems all too inclined to sever ties with America, presents a stark contrast to the aspirations of those advocating for greater freedom.
The implications are significant and troubling. A Carney victory would mean a continuation of the Liberal policies of the past decade, including the same, if not increased, mass immigration policies of his predecessor while embracing a tariff driven protectionist economic stance.
Poilievre champions more «common sense» policies, refusing, for example, the prioritization of sexual orientation over competency in hiring. However, his campaign could be significantly enhanced by explaining the WEF’s agenda, the dangers of protectionist policies, and elaboration as to what common sense means.
If there is a lesson for Europe, it’s what Canada continually fails to grasp: without a clear framework to conceptualize economic ideas, and without any discernible school of thought, society ends up meandering aimlessly. Canada has leaders devoid of articulation, a population devoid of reason, government run institutes like the LCBO or CBC, while academia sits back doing nothing shy of writing articles based on faulty economic models which bear no semblance to reality… Unfortunately, the story of Canada happens to be story of the Western world.
