Trump 2.0 Trade policy diary
trade-wars
Ontario surcharges US electricity exports; Trump retaliates with more steel and aluminium tariffs on Canada, testing the theory that trade barriers breed conflict.
On March 11, 2025, Ontario responded to US tariffs with a 25% surcharge on electricity exports to the US, prompting Trump to escalate with a further 25% tariff on Canadian steel and aluminium. The stakes are high given Canada supplies roughly 32% of US steel and aluminium imports (about $19 billion a year), risking real inflationary pressure across US industry. Trump also threatened 25% tariffs on Canadian vehicles and parts and demanded lower Canadian dairy tariffs. The post notes the episode is a live test of the political-science claim that protectionism tends to raise, not lower, conflict between trading partners.
Originally published on Substack, March 11, 2025.