What’s behind Trump’s feud with Canada — and how his new tariffs could affect you

After a one-month delay, President Trump finally imposed sweeping 25% tariffs Tuesday on goods from two of the United States’ biggest trading partners: Canada and Mexico.

Trump’s big issue with Mexico — that it doesn’t do enough to stem the flow of immigrants — has long been central to his political identity. But his animus toward Canada seems more … mysterious.

“I can’t quite figure it out,” Stephen Moore, a Heritage Foundation economist and former Trump adviser, recently told the New York Times. “Whether it’s some kind of strategic leverage, I don’t know.”

For the last 150 years, U.S. presidents have largely maintained close, cordial relations with our “nicer” neighbors to the north. Trump, in contrast, has spent the first weeks of his second term threatening to turn Canada into “the 51st state” and publicly referring to the country’s prime minister, outgoing Liberal Party leader Justin Trudeau, as “Governor” Trudeau.

Now comes Trump’s new tariffs — potentially “devastating” taxes on Canadian imports paid by the companies doing the importing. Here’s what’s behind the president’s feud with Canada — and how it could affect you.

Trump’s official reasons for the tariffs

On Feb. 1, Trump officially announced that he would be imposing tariffs on China, Mexico and Canada. Why? In order to hold them “accountable to their promises of halting illegal immigration and stopping poisonous fentanyl and other drugs from flowing into our country,” he claimed.

But while most undocumented immigrants and fentanyl enter the U.S. via the southern border, both problems are far less pronounced up north.

Last year, for instance, authorities intercepted 9,600 kilograms of fentanyl at the U.S.-Mexico border, according to U.S. Customs and Border Protection. The corresponding amount of fentanyl seized at the U.S.-Canada border over the same period? Just 19 kilograms.

Nineteen kilograms is not nothing; the Trump administration has claimed it would be enough to kill 9.5 million Americans. (Experts tend to avoid defining a lethal dose of any opioid). Still, it’s only about 0.2% of the fentanyl coming through Mexico, and Canada has spent the last month implementing various reforms to crack down even further: appointing a “fentanyl czar,” launching $140 million in new intelligence efforts and listing drug cartels as terrorist organizations.

In January, just 13.6 grams of fentanyl were seized by northern Border Patrol staff.

Meanwhile, Ottawa has mobilized on immigration as well, investing $900 million in enhanced border security; adding two Black Hawk helicopters and 60 drones equipped with thermal cameras; and tightening visa rules that made the country a stepping stone for illegal U.S. entry, according to critics.

As a result, only about 600 migrants were intercepted at the border in January, down from about 900 in January 2024, according to U.S. data. In comparison, more than 1.5 million people were apprehended at the U.S.-Mexico border last year.

But despite these disparities, Trump hit Mexico and Canada with the same 25% tariffs Tuesday — making experts think there’s more at play here than just immigration and fentanyl.

‘It’s not fair for us to be supporting Canada’

Many observers have speculated that Trump’s animosity toward Canada is primarily “personal,” as Moore told the Times.

Some have mentioned his troubled business dealings there, including a Toronto hotel and condominium complex that went into receivership in 2016 and a Vancouver hotel that failed the following year — both of which were magnets for protesters. (“Trump’s name and brand have no more place on Vancouver’s skyline than his ignorant ideas have in the modern world,” the city’s mayor wrote at the time.)

Others have noted his fractious relationship with the progressive Trudeau, 53, who was famously photographed greeting first lady Melania Trump with a European cheek kiss at a 2019 Group of 7 gathering in France. A few months later, Trump called his Canadian counterpart “two-faced” for appearing to mock him at a meeting of NATO leaders. The previous year, Trump accused Trudeau of being “very dishonest and weak.”

(After more than nine years as prime minister, Trudeau suspended Parliament in early January and vowed to resign as soon as his Liberal Party chooses a new leader on March 9. Canada’s federal elections are scheduled to follow in October, but could be called sooner.)

But whatever the two leaders think of one another, personally or politically, the simpler explanation for Trump’s recent belligerence is that the president sees Canada less as the United States’ closest ally and more as yet another freeloader country bent on ripping America off — and he’s determined to leverage Washington’s vast economic power over Ottawa to renegotiate any existing deals on more favorable “America First” terms.

“It’s not fair for us to be supporting Canada,” Trump said at a Cabinet meeting late last month. “If we don’t support them, they don’t subsist as a nation.”

This is not a new theme for Trump. During his first term, he railed against the steep tariffs Canada imposes on U.S. dairy imports to protect its own domestic farmers, calling them a "disgrace.” In 2018, he slapped 25% tariffs on Canadian steel and 10% tariffs on Canadian aluminum — a move that resulted in at least 75,000 job losses across the U.S. manufacturing sector by mid-2019, according to economists.

Likewise, Trump has long complained that the modest U.S. trade deficit with Canada (about $63 billion in goods and services) amounts to a “subsidy,” even though experts say it mostly exists because the U.S. imports a lot of inexpensive Canadian oil, which helps lower Americans’ gas prices. And Trump has never approved of Canada spending less than 2% of its GDP on defense — a gripe he also has with other NATO member nations in Europe.

Now, emboldened by his own reelection and conscious of the upcoming Canadian vote to replace Trudeau, the president seems to believe that escalating the economic pressure — by imposing Tuesday’s 25% tariffs; by stacking those tariffs with additional duties on steel and aluminum set to start March 12; by picking a new trade fight Saturday over Canadian lumber — will force a deeply dependent Ottawa to accede to whatever he demands at the negotiating table.

"Perhaps what [Trump] wants is to see a total collapse of the Canadian economy because that will make it easier to annex us," Trudeau said Tuesday. "That’s never going to happen. We will never be the 51st state.”

Real-world impact

Together, Mexico, China and Canada purchased more than $1 trillion in U.S. exports in 2023 and provided nearly $1.5 trillion of goods and services to the U.S.

With that in mind, it isn’t hard to see how life might get more expensive for Americans now that a 25% tariff will be added every time a part, product or raw material crosses our northern border.

Consider the auto industry. A single car or truck can move back and forth between the U.S. and Canada up to eight times before it’s fully assembled. As a result, S&P Global estimates that Trump’s tariffs could cost automakers up to 17% of their annual core profits — which could translate into a $3,000 price hike for the average car, according to Kelley Blue Book.

Canada also exports 80% of its oil to the United States; the U.S. gets half of its imported oil from Canada. As a result, analysts estimate that gas prices will rise by as much as 30 cents per gallon under Trump's new tariffs — even though the president is imposing a lower, 10% duty on Canadian oil to limit pain at the pump.

Then there’s retaliation to factor in. In response to Trump’s tariffs, the Canadian government immediately imposed its own 25% tax Tuesday on hundreds of American imports valued at $30 billion — and officials say they will add another $86 billion worth of products over the next three weeks. Affected U.S. goods are likely to include poultry, tomatoes, honey, peanut butter, furniture, mattresses, dishwashers, refrigerators and American alcohol — which several Canadian provinces now plan to pull from their government-run shelves.

Some Canadian officials have also proposed cutting off shipments of oil, gas and electricity to the U.S. (or imposing steep export taxes on those products).

At the same time, U.S.-Canada relations are likely to deteriorate even further. Already, Trump’s “51st state” trolling has led some Canadians to boycott American goods and cancel their U.S. vacations. And Trudeau’s Liberal Party, which had been suffering in the polls, has enjoyed a sharp uptick in support since Trump took office in January.

“You can’t take our country," the prime minister wrote on X last month, after Canada defeated the U.S. in the 4 Nations Face-Off men’s hockey championship. "And you can’t take our game."