Prime Minister Mark Carney said Canada was under economic attack Saturday after trade negotiations collapsed, new U.S. tariffs took effect and he suggested divisions inside U.S. President Donald Trump’s administration contributed to the breakdown.
Speaking Saturday morning, Aug. 22, Carney was asked why his tone toward Washington had changed and whether Canada was entering a trade war.
“Because we were attacked,” Carney said. “Like, you’re at war when you get attacked. We got attacked.”
The United States imposed 50 per cent tariffs at 12:01 a.m. Saturday on selected Canadian goods worth about $28 billion.
The duties had initially been scheduled to take effect Aug. 19 before Trump issued a three-day postponement as negotiations progressed.
Carney said Canada would retaliate against American imports starting Sept. 8, matching the value of goods targeted by the U.S. tariffs.
He identified steel, dairy, appliances, agricultural equipment, pulp and paper and electronics as potential targets. Ottawa has yet to release the complete product list or the tariff rates that would apply.
“We’ve got the reserves. We’ve got the resilience. We’ve got the plan. We’ve got the focus,” Carney said. “We will respond.”
Deal appeared close before negotiations broke down
Both governments had suggested earlier in the week that an agreement was within reach.
Trump said Tuesday, Aug. 18, that the countries had reached a deal, subject to finalizing the documents. Carney said negotiators had made substantial progress but that additional work was needed.
By Friday night, Aug. 21, Carney had suspended negotiations and instructed Canada’s team to return to Ottawa.
He said American officials introduced new demands during the final hours that threatened Canadian industries and the country’s ability to make independent decisions.
“In short, they asked too much, and they offered too little,” Carney said.
U.S. Trade Representative Jamieson Greer disputed that account, blaming Canada for the breakdown and saying the two countries had no additional negotiations planned.
“We’re moving forward with measures that respond to Canadian retaliation,” Greer told Fox News on Saturday.
Carney also suggested the American negotiating team was not working toward a common objective.
Asked whether U.S. Commerce Secretary Howard Lutnick’s involvement had complicated the final negotiations, Carney declined to blame him directly.
He described Canada’s team as unified, with cabinet ministers, senior officials and diplomats working together.
“You cannot say that about the United States administration,” Carney said.
He suggested the final negotiations may have exposed disagreements within the American administration, while stressing that responsibility ultimately rested with Trump.
“Ultimately, there’s a decision-maker at the top,” Carney said.
Trucks, trade agreements and cultural protections
Carney said one of Washington’s late demands would have excluded Canadian-made medium- and heavy-duty trucks from favourable tariff treatment.
He identified Ford trucks assembled in Oakville, Ont., and General Motors pickups produced in Oshawa, Ont., as examples of vehicles that could be affected.
Ford’s official plant directory lists the F-350 and F-450 among the Super Duty models produced in Oakville. General Motors manufactures heavy-duty and light-duty Chevrolet Silverado pickups in Oshawa.
Carney said the proposed restrictions would have made Canadian truck production less competitive.
He also said American negotiators sought provisions restricting Canada’s ability to reach trade agreements with other countries.
“It’s a power play,” Carney said.
He described those demands as a question of Canadian sovereignty and said Ottawa would make its own decisions about international trade.
Carney also accused U.S. negotiators of pressing for changes affecting Canadian cultural protections and the French language.
He said those issues had never been open for negotiation.
Carney said Canada had offered to remove retaliatory tariffs on steel, aluminum and vehicles if the United States significantly reduced its own duties.
Ottawa was also prepared to ask provinces to return American alcohol to store shelves and consider administrative changes involving dairy access while preserving supply management, according to the Prime Minister’s Office.
“We cannot accept what they’ve offered, and we will not give what they’ve asked,” Carney said.
Business support expected next week
Carney said many companies affected by the U.S. tariffs were small- and medium-sized businesses, particularly in Ontario, Quebec and B.C.
“We’re going to hit back,” he said. “We will do whatever it takes to support these businesses.”
Carney said details of additional assistance would be announced early in the week of Aug. 24.
He identified regional development agencies and the Business Development Bank of Canada as possible channels for delivering support, but did not announce specific programs or funding amounts.
Carney said assistance would remain available for as long as necessary.
“In other words, beyond the life of this U.S. administration,” he said.
The government previously identified nearly $25 billion in support for workers and businesses affected by American tariffs over the past 18 months, according to a statement from the Prime Minister’s Office.
Carney acknowledged that Canadian countermeasures would increase some costs and reduce consumer choice.
He said the government would target industries disadvantaged by U.S. trade actions while working to limit the impact on Canadians.
Critical minerals and export markets
Carney said the dispute could reduce opportunities for Canada and the United States to co-operate on critical minerals.
Asked whether American officials had demanded exclusive access to Canadian resources, Carney did not confirm that such a demand had been made.
He said Canada would never agree to exclusive American access and suggested the confrontation could encourage stronger partnerships with other countries.
Carney also pointed to potential overseas oil and liquefied natural gas exports as ways to reduce Canada’s reliance on the American market.
U.S. Democrats criticize Trump’s tariffs
Several Democratic politicians criticized Trump’s decision to impose new tariffs on one of the United States’ closest allies.
California Governor Gavin Newsom questioned the direction of American trade policy in a blunt social media post.
“Our closest ally. Our critical trading partner. And Trump is hitting Canada with 50% tariffs. What the actual f*** are we doing?” Newsom wrote.
https://x.com/GavinNewsom/status/2091201588320985174
Michigan Governor Gretchen Whitmer said the tariffs would raise costs for families and businesses in her state.
“These tariffs act as a tax hike on Michigan families and businesses by raising prices at the grocery store and the gas pump,” she wrote.
https://x.com/GovWhitmer/status/2091198433595998498
Whitmer said automakers could be forced to lay off workers or pass additional costs on to customers.
“This must end,” she wrote.
https://x.com/GovWhitmer/status/2091198435328135616
Minnesota Senator Amy Klobuchar said the tariffs would increase costs for farmers, small businesses and families.
“Canada is Minnesota’s #1 trading partner,” she wrote. “Minnesotans are paying for Trump’s chaos.”
https://x.com/amyklobuchar/status/2091178222373212163
Business group warned of damage to North American trade
The U.S. Chamber of Commerce warned on Aug. 18 that higher tariffs could damage both economies and disrupt supply chains.
The organization said 13 million American jobs depend on trade under the Canada-United States-Mexico Agreement, known as CUSMA in Canada and USMCA in the United States.
It warned that higher tariffs could put that broader trading relationship at risk, but did not estimate how many jobs might be lost as a direct result of the latest Canada-U.S. dispute.
