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If Trump wins in 2020 Here’s what Canadians can expect

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TORONTO —
This November, Americans will cast their ballots in what will undoubtedly be the most watched election of the year.

Whether or not U.S. President Donald Trump can pull off a second win is far from certain. The Democratic race for president remains unusually crowded, and while it’s unlikely that the Republican-held Senate will vote to remove Trump from office, the results of the impeachment proceedings are still technically undecided.

What is clear is that a second term for Trump would give the billionaire president another four years in the Oval Office – a time when many presidents focus on crafting their political legacies.

But what would that look like? And what would it mean for Canada?

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CTVNews.ca spoke with several political scientists, economists and Canada-U.S. relations experts to get a sense of what our country could expect if Trump wins re-election.

LUMBER, AUTO INDUSTRIES IN LIMBO

For certain businesses that rely on cross-border trade, a second term for Trump could lead to more volatility.

Canada’s auto industry directly employs 125,000 workers and indirectly affects another 400,000 workers. Some of those jobs could be at risk thanks to Trump’s war with California over fuel efficiency standards, according to Werner Antweiler, a business professor at the University of British Columbia and an expert in international trade.

In hopes of making cars more energy efficient and cutting back on gas emissions, former U.S. president Barack Obama introduced measures that would have nearly doubled fuel efficiency for all vehicles by 2025. Trump campaigned on a plan to freeze those standards. But California — the country’s most populous state — opted to follow through on Obama’s goals, a move that prompted Trump to tweet that Henry Ford was “rolling over” in his grave.

This uncertainty leaves Canadian auto makers in the lurch, Antweiler said, because they will be forced to choose which group to side with.

“Where will Canada be? Will Canada follow California, or will it revert to the lower federal standards in the U.S.?” he said. “We have a very important auto industry in Canada that is historically always aligned with the U.S., and I see a battle shaping up.”

Then there is the Canadian lumber industry, which was hit by steep tariffs during Trump’s first year in office. The U.S. has accused Ottawa of unfairly subsidizing lumber and then selling it to the U.S.

Canada has filed complaints under the World Trade Organization and NAFTA, but the issue remains unresolved, even under the newly agreed upon Canada-United States-Mexico Agreement, or CUSMA.

“This file is still one that’s dangling,” Antweiler said.

“Ultimately, we need something that provides predictability to the lumber sector in Canada so that we’re not going to get short-changed again from arbitrary rules from the U.S.”

A RECESSION IN 2020?

Fears of a recession have been on economists’ lips since August, when markets reported a yield curve inversion. Every recession since 1957 has followed a yield curve inversion, which happens when the payout for 10-year bonds suddenly slips below the payout for two-year bonds — a scenario that is essentially the opposite of what happens in a well-functioning, healthy economy.

Trump’s ongoing trade war with China — pitting the world’s two biggest economies against each other — has only worsened those fears.

“There are danger signs on the horizon,” Antweiler said.

“If Mr. Trump undermines the confidence of the world economy and we end up in a recession, that would be a particularly bad outcome for the United States, but also for Canada as well.”

‘TRUMP ERA’ SOLIDIFIED

Pollsters didn’t forecast a win for Trump in 2016, and so his victory came as a surprise to many political pundits.

If Trump were to win in 2020, the narrative would be different, according to Fan Lu, assistant professor of political studies at Queen’s University.

“When Trump won the first time, we thought it was a fluke. But if he wins a second time, it’s a pattern and something that is symptomatic,” she said.

“If that’s the case, then Canada as a country has to decide if it wants to serve as a counterpoint to Trump’s America or follow in its footsteps.”

As close neighbours, Canada and the U.S. share many similar problems, but Lu expects conversations around immigration will be especially heated if Trump wins again.

“I think the conversation already started when Trump imposed the Muslim ban and Trudeau tweeted out in 2017 … ‘to those fleeing persecution, Canadians will welcome you,’” Lu said. “And (Trudeau) has been somewhat blamed by some Canadians for increasing the illegal entries into Canada at these border crossings.”

Since the Immigration and Refugee Board of Canada started tracking irregular border crossers in February 2017, Canada has received 45,517 refugee claims as of June 2019. Of those, 9,069 have been accepted. Another 27,173 claims are pending, while 7,786 claims have been rejected.

If Trump is re-elected, Lu expects debate around illegal border crossings will “ramp up and become even more salient.”

Lu’s research closely follows race in America. Trump has called Mexicans “rapists,” told four Congresswomen of colour to “go back home” and described a majority-black district in Baltimore as a “rat and rodent infested mess.”

Those sorts of comments only embolden people who hold racist views, Lu said, including “certain wings of Canada that would welcome” such behaviour.

“So if he gets re-elected, it legitimizes this sect of the electorate even more.”

DRUGS AND HEALTH CARE

Trump isn’t afraid to call out political leaders or foreign policies he doesn’t agree with. Recently, he threatened to use Britain’s National Health Service as a bartering tool in Brexit trade negotiations.

Wayne Petrozzi, a professor emeritus of politics from Ryerson University, suspects that Trump wouldn’t be afraid to similarly meddle in Canada.

“I have no doubt. Look at his willingness to use tariffs against Canada in discussions around the (CUSMA) trade agreement. All of the sudden there was this idea that Canada was a national security risk, so all of the sudden (Trump was) putting tariffs on Canadian steel,” he said.

On the chopping block, Petrozzi suggests, could be the Canadian health-care system or the pharmaceutical industry, which sells drugs like insulin at a fraction of American prices thanks to the government’s involvement in controlling prices.

“This has been an issue that has risen to the surface and slid back under the waves in the past,” Petrozzi said.

“There’s a longstanding complaint from the pharmaceutical sector in the United States about the way Canadian governments use bulk buying in order to reduce prescription drug costs. There has been criticism coming out of (the U.S.) about what they call the uneven playing field in Canada and the United States, and they’re concerned about that … I could easily see pharmaceuticals and more broadly the Canadian health sector becoming a flash point.”

However, on access to low-cost drugs, it appears Trump is open to working with Canada. In mid-December, the Trump administration said it intended to move ahead with a plan to allow Americans to import certain brand name drugs from Canada at cheaper prices.

The move was criticized by House Speaker Nancy Pelosi’s spokesperson, who pointed out that Trump has offered no deadline to implement the plan.

WHAT IF A DEMOCRAT WINS?

If a Democrat pulls off a win in November, don’t expect Canada-U.S. relations to immediately get warmer.

In fact, depending on the Democrat, Canada could face entirely new challenges, according to Craig Geoffrey, an assistant professor who teaches classes on corporate finance at the University of Toronto.

Some candidates, such as Bernie Sanders and Elizabeth Warren, have campaigned on plans to rein in big banks. Many Canadian jobs — especially in Toronto — are closely tied to the financial service industry, and if Sanders or Warren followed through on those promises, “that’s going to have a negative impact for employment in Canada,” Geoffrey said.

“They have a lot of exposure to the U.S.,” he said. “If there are real legislative changes in the U.S. that make financial services less profitable, that’s going to hurt them.”

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Alberta to require 'free speech reporting' after uproar over controversial academic visit – CBC.ca

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Alberta to require ‘free speech reporting’ after uproar over controversial academic visit  CBC.ca

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Canada’s Black population faces varying job prospects despite equal education. Here’s why – Global News

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Canada’s Black population faces varying job prospects despite equal education. Here’s why  Global News

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Inflation in Canada: Finance ministers meet

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TORONTO – The two big spending pressures on the federal government right now are health care and the global transition to a clean economy, Deputy Prime Minister and Finance Minister Chrystia Freeland said Friday.
After hosting an in-person meeting with the provincial and territorial finance ministers, Freeland said U.S. President Joe Biden’s Inflation Reduction Act, which includes electric-vehicle incentives that favour manufacturers in Canada and Mexico as well as the U.S., has changed the playing field when it comes to the global competition for capital.

“I cannot emphasize too strongly how much I believe that we need to seize the moment and build the clean economy of the 21st century,” Freeland said during a news conference held at the University of Toronto’s Munk School of Global Affairs and Public Policy.

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“This is a huge economic opportunity.”

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Canada needs to invest in the transition in order to potentially have an outsized share in the economy of the future, she said, or it risks being left behind.

This year in particular will be an important year for attracting capital to Canada, she said, calling for the provinces and territories to chip in.

“This is a truly historic, once-in-a-generation economic moment and it will take a team Canada effort to seize it.”

At the same time, Freeland spoke of the need for fiscal restraint amid economic uncertainty.

“We know that one of the most important things the federal government can do to help Canadians today is to be mindful of our responsibility not to pour fuel on the fire of inflation,” she said.

Freeland said these two major spending pressures, which were among the topics prioritized at Friday’s meeting, come at a time of a global economic slowdown which poses restraint on government spending.

Prime Minister Justin Trudeau is set to meet with the premiers Feb. 7 to discuss a long-awaited deal on health-care spending. The provinces have been asking for increases to the health transfer to the tune of billions of dollars.

Freeland said it’s clear that the federal government needs to invest in health care and reiterated the government’s commitment to doing so but would not say whether she thinks the amount the provinces are asking for in increased health transfers is feasible.

“It’s time to see the numbers,” Quebec Finance Minister Eric Girard said Friday afternoon, in anticipation of the Feb. 7 meeting.

The meeting of the finance ministers comes at a tense time for many Canadian consumers, with inflation still running hot and interest rates much higher than they were a year ago.

The ministers also spoke with Bank of Canada governor Tiff Macklem Friday and discussed the economic outlook for Canada and the world, said Freeland.

“We’re very aware of the uncertainty in the global economy right now,” said Freeland. “Inflation is high and interest rates are high.”

“Things are tough for a lot of Canadians and a lot of Canadian families today and at the federal level, this is a time of real fiscal constraint.”

The Bank of Canada raised its key interest rate again last week, bringing it to 4.5 per cent, but signalled it’s taking a pause to let the impact of its aggressive hiking cycle sink in.

The economy is showing signs of slowing, but inflation was still high at 6.3 per cent in December, with food prices in particular remaining elevated year over year.

Interest rates have put a damper on the housing market, sending prices and sales downward for months on end even as the cost of renting went up in 2022.

Meanwhile, the labour market has remained strong, with the unemployment rate nearing record lows in December at five per cent.

This report by The Canadian Press was first published Feb. 3, 2023.

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