By JOSH BOAK
PALM BEACH, Fla. (AP) — President Donald Trump said Sunday that Americans could feel “some pain” from the emerging trade war triggered by his tariffs against Canada, Mexico and China, and claimed that Canada would “cease to exist” without its trade surplus with the United States.
The trade penalties that Trump signed Saturday at his Florida resort caused a mix of panic, anger and uncertainty, and threatened to rupture a decades-old partnership on trade in North America while further straining relations with China.
Trump on Sunday night returned from Florida and threatened to impose steeper tariffs elsewhere, telling reporters that the import taxes will “definitely happen” with the European Union and possibly with the United Kingdom as well.
He brushed aside retaliatory measures from Canada, saying, “If they want to play the game, I don’t mind. We can play the game all they want.” Trump said he plans to speak with his Canadian and Mexican counterparts on Monday.
By following through on his tariffs campaign pledge, Trump may also have simultaneously broken his promise to voters in last year’s election that his administration could quickly reduce inflation. That means the same frustration he is facing from other nations might also spread domestically to consumers and businesses.
“WILL THERE BE SOME PAIN? YES, MAYBE (AND MAYBE NOT!),” Trump said in a social media post. “BUT WE WILL MAKE AMERICA GREAT AGAIN, AND IT WILL ALL BE WORTH THE PRICE THAT MUST BE PAID.”
His administration has not said what specific improvements would need to be seen in stopping illegal immigration and the smuggling of fentanyl to merit the removal of the tariffs that Trump imposed under the legal justification of an economic emergency. But Trump, speaking to reporters after Air Force One, landed said that the trade imbalances with Canada and Mexico would also need to be erased as a condition for lifting the tariffs.
The president also tried to clarify his post about the possible inflation, saying on Sunday: “We may have in the short term, a little pain, and people understand that. But long term, the United States has been ripped off by virtually every country in the world.”
The tariffs are set to launch Tuesday and triggered confusion as Canada’s U.S. ambassador, Kirsten Hillman, told ABC News that her country was perplexed by the move because “we view ourselves as your neighbor, your closest friend, your ally.”
In his Truth Social post, Trump took particular aim at Canada, which responded with retaliatory measures. Trump is placing a 25% tariff on Canadian goods, with a 10% tax on oil, natural gas and electricity. Canada is imposing 25% tariffs, more than $155 billion Canadian (US$105 billion), on U.S. products, including alcohol and fruit.
Despite Trump’s assertions that the U.S. does not need Canada, one-quarter of the oil that America consumes per day is from its ally to the north. He reiterated his false claim that America subsidizes Canada by running a trade imbalance, a reflection in part of Canada exporting energy to the U.S.
Trump contended that without that surplus, “Canada ceases to exist as a viable Country. Harsh but true! Therefore, Canada should become our Cherished 51st State. Much lower taxes, and far better military protection for the people of Canada — AND NO TARIFFS!”
Prime Minister Justin Trudeau is encouraging Canadians to buy more Canadian goods, and says Trump’s moves will only cause pain across North America. More than 75% of Canada’s exports go to the U.S. Canada will first target alcohol, cosmetics and paper products; a second round later will include passenger vehicles, trucks, steel and aluminum products, certain fruits and vegetables, beef, pork, dairy products and more.
Canada is the largest export market for 36 states and Mexico is the largest trading partner of the U.S.
Mexico’s president, Claudia Sheinbaum, also announced new tariffs and suggested the U.S. should do more within its own borders to address drug addiction. She and Trudeau spoke after Trump’s announcement and agreed “to enhance the strong bilateral relations” between Canada and Mexico, according to the prime minister’s office.
The Chinese government said it would take steps to defend its economic interests and intends to file a lawsuit with the World Trade Organization.
For Trump, the open question is whether inflation could be a political pressure point that would cause him to back down. As a candidate, Trump repeatedly hammered Democrats over the inflation under President Joe Biden that resulted from supply chain issues during the coronavirus pandemic, the Biden administration’s own spending to spur the recovery and Russia’s invasion of Ukraine.
Trump said his previous four years as president had low inflation, so the public should expect the same if he came back to the White House. But he also said specifically that higher inflation would stagger the U.S. as a nation, a position from which he now appears to be retreating with the promise of even more tariffs to come.
The U.S. president did not offer details Sunday about when he would impose tariffs elsewhere, but he said they would be coming “pretty soon” for the EU, which is also composed of U.S. allies.
Larry Summers, treasury secretary in the Clinton administration, said the tariffs were a “self-inflicted wound to the American economy.”
He told CNN’s “Inside Politics” that “on the playground or in international relations, bullying is not an enduringly winning strategy. And that’s what this is.” And the ultimate winner, Summers suggested, would be Chinese leader Xi Jinping because “we’ve moved to drive some of our closest allies into his arms” and “we’re legitimating everything he’s doing by violating all the international norms that we set up.”
Outside analyses make clear that Trump’s tariffs would hurt the voters that he intended to help, meaning that he might ultimately need to find a resolution.
An analysis by the Budget Lab at Yale shows that if the tariffs were to continue, an average U.S. household would lose roughly $1,245 in income this year, in what would be the overall equivalent of a more than $1.4 trillion tax increase over the next 10 years.
Goldman Sachs, in a Sunday analyst note, stressed that the tariffs go into effect on Tuesday, which means they’re likely to proceed “though a last-minute compromise cannot be completely ruled out.”
The investment bank concluded that because of the possible economic damage and possible conditions for removal “we think it is more likely that the tariffs will be temporary but the outlook is unclear.”
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Associated Press writers Michelle L. Price in New York and Rob Gillies in Toronto contributed to this report.
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