William Watson: Carney not signing trade deal was good, war talk wasn’t

Prime Minister Mark Carney speaks during a press conference addressing the trade situation with United States in Ottawa on Saturday, Aug. 22, 2026. Photo by HYUNGCHEOL PARK /Postmedia

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Jaw-jaw is better than war-war, said Winston Churchill, who was well-versed in both. Of course, Churchill never jaw-jawed with Donald Trump, notorious bad-faith bargainer. 

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Near the end of Prime Minister Mark Carney’s news conference Saturday the National Post’s Christopher Nardi asked whether we were now in a trade war with the United States. “We were attacked,” Carney answered, “You’re at war when you get attacked. We got attacked.” So we are “at war” with by far our most important trading partner. It was a candid offhand remark that provided the lead to many news reports of Carney’s comments and is bound to have been noted in the White House. Firm action is good. Not signing a bad deal is good. Taunting a hair-trigger megalomaniac isn’t.

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The prime minister’s opening speech, which he read off a teleprompter in a monotone a little less enervating and a French slightly more fluent than when he first took office, was fine. Or at least half of it was. The first 10 minutes addressed the failed negotiations with a seriousness that met the gravity of the moment. The second 10 re-hashed all the good things the federal government has done — or at least announced — since coming to office to “Build Canada Strong” and make us more resilient, independent of the U.S. and connected to the world. It sounded a lot as if a second Carney v. Trump federal election may be coming, this one with Carney as Trump-defier rather than Trump-whisperer. 

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Being more connected with other countries is certainly good. The prime minister touted our new free trade agreement with the United Arab Emirates, which we negotiated in just 47 days (which suggests it may not be deep or comprehensive). But in 2025 our exports to the UAE were US$2 billion, so just half a per cent of our US$409 billion of exports to the U.S. Is a country really more connected if it loses one big connection but picks up a lot of little ones? We will need 200 more UAEs to equal the economic weight of the U.S.

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For as long as Canada has existed, we have been skirmishing with the Americans over trade. Even longer, in fact. The U.S. abrogated the first free-trade agreement between us in 1866, the year before Confederation, when they terminated the Reciprocity Treaty of 1854. There have been irritants and bickering ever since, but also major policy achievements like the Auto Pact, Canada-U.S. free trade and NAFTA. 

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So nobody’s pure on trade. But Carney is right: the U.S. clearly started this round. We were attacked. And there was no attempt to deny it: President Trump has said many times he wants to “re-shore” our steel, aluminum and auto businesses. In this fight we clearly have the moral high ground. 

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We and China are the only countries, the U.S. whines, to have retaliated against their tariff blitzkrieg. That speaks well of us and China and poorly of all the other countries bullied into bad deals.

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But saying we’re now at war with the U.S., trade war at least, and sending return salvoes, won’t hold the high ground. The Americans’ stockpile of trade ammunition is way bigger than ours. And Americans who oppose Trump’s aggression against us, including many in Congress who will remain chicken-hearted until he’s a burnt-crisp lame duck, will find our escalation of language an excuse for continued fowl behaviour.