Canada has retaliated against Trump’s tariffs. Should Carney go even further?

Industry Minister Mélanie Joly speaks during a press conference at Ideal Roofing Company Limited Manufacturers in Ottawa on Tuesday, Aug. 25, 2026. Photo by HYUNGCHEOL PARK /Postmedia

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WASHINGTON, D.C. — Ottawa and Washington have been engaged in a rhetorical tit-for-tat over tariffs since talks broke down and the U.S. imposed Section 338 duties on hundreds of Canadian imports over the weekend.

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Prime Minister Mark Carney explained why he pulled his team back and promised retaliatory tariffs, while President Donald Trump posted to social media several times, threatening Canada with even higher auto tariffs and denying he made any demands that meddled with French culture.

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On Tuesday morning, Carney’s team showed its hand on the retaliatory tariffs it promised, revealing the list of products to be hit with duties starting September 8. The plan is to apply 50 per cent tariffs on steel and aluminum imports from the U.S., as well as furniture, clothing, milk, plywood, paper, honey, doors and windows, smartphones, and perfumes, among others. Additional products will face 25 per cent tariffs, including carpets and textiles, cheese, large kitchen appliances, and seafood.

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So will the retaliation be enough to get Washington’s attention in a way that focuses the U.S. administration on sealing a deal or should Canada go even further?

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Canadian Prime Minister Mark Carney (L) speaks about the trade dispute with the United States at the Davie Shipyard in Levis, Quebec, Canada on August 24, 2026.  Photo by ANDREJ IVANOV /AFP via Getty Images

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“Right now, the (U.S.) tariffs affect a narrow set of products, and I would imagine that the Canadian retaliation would also start off affecting a narrow set of American products relative to everything that the U.S. exports to Canada,” said Alfredo Carrillo Obregon, a trade policy analyst at the Cato Institute in Washington, before the Canadian list was revealed.

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“Over time, you continue escalating, and then you’re really going to touch on products that are important for consumers and important for businesses on both sides of the border.”

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Ottawa said its list was crafted to protect the “domestic market share for Canadian companies,” rather than to target politically sensitive products in U.S. battleground states ahead of the midterm elections this November.

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This makes sense, according to Graeme Thompson, senior analyst with Eurasia Group’s Global Macro team, because Canada-imposed tariffs will cost Canadians.

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“Tariffs are a tax. It’s as simple as that,” said Thompson. “If you put a tariff on a good that you are importing, it is more expensive for consumers. Full stop.”

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Canada on August 25, 2026, announced counter-tariffs on US goods ranging between 15 percent and 50 per cent, intensifying the trade war between the historically close allies. Photo by ANDREJ IVANOV,SAUL LOEB /AFP via Getty Images

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That said, Canada’s retaliatory list — intentionally or not — is still likely to have a disproportionate political effect in battleground states with large steel, auto, appliance, agricultural, paper, food-processing or consumer-goods sectors. Michigan and Ohio come to mind for steel and autos, while North Carolina and Georgia could also feel the effect owing to their furniture and appliance markets. Iowa, Wisconsin, and Minnesota, meanwhile, are vulnerable through their dairy, agricultural, and food-processing sectors.