Trump’s Canadian Tariffs Make No Sense

National Review Online

Wednesday, July 22, 2026

 

Donald Trump is compiling the most anti-Canadian record of any president since James Madison, who launched multiple invasions.

 

The White House has announced new 50 percent tariffs on a wide range of Canadian imports, “covering products ranging from wine to hockey sticks to cement,” a blow for American affordability as well as Canadian exporters. The new tariffs are set to take effect in 30 days.

 

The administration is claiming the authority to impose these latest tariffs under Section 338 of the Tariff Act of 1930, an act better known as Smoot–Hawley, a familiar name to students of the Great Depression. Section 338 itself had lain dormant for the better part of a century. It was considered on a few occasions in the 1930s and, again, in 1949 as something to be used against newly communist China. No tariffs were imposed in any of these cases. Regarded as an irrelevance in the age of postwar trade multilateralism, it was never repealed. The election of a “tariff man” in 2016 revived interest in this long-dormant section, which has now finally been reawakened. We are reminded once again, if only by default, of the value of sunset clauses.

 

Under Section 338, the president is authorized to impose tariffs of up to 50 percent on goods from a country on one of two conditions. The first is that that country has imposed “an unreasonable charge, exaction, regulation, or limitation” on any U.S. products without subjecting similar products from other countries to the same treatment. The second is when there is de facto discrimination in that country that “disadvantages” U.S. commerce as compared with that of any other foreign nation. As an example of the latter, the White House cites the way that, “beginning in March 2025, all Canadian provinces and territories halted the purchase, distribution, or retailing of U.S. alcoholic beverages.” Leaving aside the question whether the White House’s actions are in compliance with WTO rules or the provisions of NAFTA’s successor, the USMCA (questions that would take a long time to resolve), it seems to us that, on the facts, the president is within his legal rights to take the actions he has under Section 338 under domestic law, even if doing so is a mistake.

 

When it comes to negotiations, especially with historically friendly nations, adopting a tough stance is one thing; taking a belligerent one quite another. Suddenly announcing a 50 percent tariff hike on a wide range of items shortly after beginning the formal process that would terminate the USMCA in its current form in 2036 can be reasonably described as aggressive. The same can be said of the introduction of earlier tariffs on our northern neighbor, tariffs made no easier for Canadians to stomach by unnecessary, counterproductive, and insulting talk of their country as the “51st state.” Indeed, they triggered the Canadian retaliation against which the U.S. is now retaliating. That’s how escalation works.

 

We would add that in an era of rising geopolitical tensions, concern about supply lines, and worries about the Arctic, alienating Ottawa makes little sense. Mark Carney’s unwise diplomatic pivot toward Europe and China was something that he was probably always inclined to do, but the administration has now made it easier for him take this course.

 

So, what to do now? The logic behind NAFTA and the USMCA (the latter, it should be remembered, a treaty agreed during the president’s first term) was three-fold: economic efficiency (and thus greater prosperity), a reduction of the degree to which trade could act as an irritant between the U.S., Canada, and Mexico, and closer ties among North America’s three largest powers.

 

All those arguments still make sense to us, if not to the Trump administration. We hope, however, that the White House can see that trying to bludgeon its way to what it sees as a fairer trade relationship with Canada is hurting more than it helps. It should throw a few olive branches on the table as trade talks between the two sides continue.

 

More broadly, this episode only reinforces our conviction that, despite the best efforts of the Supreme Court, the current state of the law still gives the president too much latitude to turn tariffs into his playthings. That has to stop. A tariff is a tax. Taxation is, under the Constitution, a matter for Congress. When it comes to tariffs, Congress must do its constitutional duty, reverse the excessive delegation of its powers to the executive, and take back control.