U.S. President Donald Trump on the 25th (local time) announced a further 10% increase in tariffs on imports from Canada. The trigger was a TV ad produced by Ontario, Canada, that quoted former President Ronald Reagan's anti-tariff speech. Trump called the ad a "fraud" and a "hostile act."
Trump stated accordingly on his social media platform Truth Social while aboard Air Force One for an Asia tour. He wrote, "Canada was caught red-handed posting a fraudulent ad about Ronald Reagan's speech." He added, calling it "a gross distortion of the facts and a hostile act," that "we are increasing Canadian tariffs by 10% on top of what they currently pay." The White House, the Canadian prime minister's office, and the Ontario State Governments have not yet provided details on exactly which tariffs the "10% increase" Trump mentioned would apply to.
The ad in question is a one-minute video that the Ontario State Governments spent about $75 million (about 100 billion won) to air on U.S. TV networks. The ad quoted parts of a 1987 nationwide radio address by former President Reagan. In the ad, Reagan says tariffs "hurt every American worker and consumer" and "ignite fierce trade wars." Ontario aired the ad heavily during broadcasts of the World Series in Major League Baseball. The Toronto Blue Jays, from Toronto, Ontario's largest city, are Canada's only Major League team and are currently facing the Los Angeles Dodgers in the World Series to decide the league's top spot.
Trump on the 23rd denounced the ad as "fake" and declared a halt to all trade negotiations with Canada. As the situation worsened, Ontario Premier Doug Ford said on the 24th that he "discussed with Canadian Prime Minister Mark Carney to resume trade talks." Ontario announced it would pause the ad campaign starting on the 27th. But Trump wanted an immediate halt. On the 25th, he criticized that "(the Ontario government) should have taken the ad down immediately, but they allowed it to run throughout the World Series even though they knew it was a fraud."
Trump argued that Canada ran the ad to influence a U.S. Supreme Court ruling scheduled for next month. The case deals with whether the Trump administration's overall tariff policy is unconstitutional. Earlier, a U.S. federal appeals court ruled that the tariffs Trump broadly imposed on dozens of countries, including Canada and Mexico, were unconstitutional. The Trump administration has appealed to the Supreme Court.
If Trump loses at the Supreme Court, tariffs imposed on Canada and Mexico on grounds of fentanyl trafficking and illegal immigration could be nullified. Trump called the case "the most important lawsuit ever" and said the Canadian ad "is trying to interfere with the trial." He also claimed Canada distorted the facts, saying "Reagan loved tariffs for national security and the economy."
The Ronald Reagan Presidential Foundation and Institute, which manages the former president's legacy, also raised concerns about the ad. The foundation said the Ontario State Governments "never requested or received permission for the use or editing of the remarks." The foundation's statement said the ad "uses selective audio and video and misrepresents former President Reagan's remarks." It added that legal action is under review. Kevin Hassett, Director General of the White House National Economic Council (NEC), said on the 24th that "the president's anger is not just about a single ad," and that it "reflects frustration with Canada's behavior and attitude during months of negotiations."
The Trump administration has already imposed high tariffs on major Canadian exports such as steel, aluminum, automobiles, lumber, and energy. According to the BBC, the United States is already imposing 50% on Canadian metals and a 25% tariff on automobiles. It also levied a 35% tariff on the rest of Canadian goods broadly. However, most goods covered by the United States-Mexico-Canada Agreement (USMCA) are exempt from tariffs. The new 10% increase is in addition to these existing tariffs.
Tariff barriers are hurting both countries' economies and public sentiment. Canada's unemployment rate hit a record high in nine years. In the United States, overland trips by Canadians to the United States fell 31% through September this year. U.S. distilled spirits exports to Canada plunged 85% in the second quarter.
Canadian Prime Minister Mark Carney, visiting Malaysia to attend the Association of Southeast Asian Nations (ASEAN) summit, has not yet issued an official position on the new tariff measure. Trump likewise told the traveling press in Malaysia that he has "no intention" of meeting Carney.
Derek Burney, a former chief of staff to a Canadian prime minister, said in an interview with CBC, "What drove the (past) United States-Canada agreement was the firm resolve of the (Reagan) president and prime ministers for free trade."