Canadian Reciprocal Tariffs Begin

On Friday, the official list of Canadian tariffs was finalized; they go into effect Sunday.

The full list is here, from the Canadian Finance Department: Countermeasures Action

The reason given for the tariffs is suggested in the title, and provided within the body of the announcement:

In response to these measures, Canada intends to impose surtaxes or similar trade-restrictive countermeasures against up to C$16.6 billion in imports of steel, aluminum, and other products from the U.S., representing the value of 2017 Canadian exports affected by the U.S. measures. The Government is also considering whether additional measures may be required.

These join a prior list of tariffs already set in place by the European Union: Tariff List.  They also join tariffs enacted by Mexico. (Reuters)

All of these are retaliatory in nature; all of them are being enacted by countries which have been allied with ours for decades.  All have been targeted toward states that voted for Donald Trump.  All of them are reciprocal; that is to say, the tariffs have been measured to enacted taxes on American businesses equal to those being levied against the foreign countries’ businesses by the Trump Administration.

There is a valid point when President Trump says that our adversaries have engaged in questionable activity against American businesses.  Most notable among them is China, with a history of state-sponsored industrial espionage (ZDnet) and theft of trade secrets. (CNN)  These, however, are not our adversaries.  They are allies.

And our allies are striking back at the unexpected attacks.  One target that is found on both Canadian and EU lists?  Playing cards, for which the US Playing Card company is the dominant maker in the world.  They’ve also just finished a large capital expenditure moving from Ohio into Northern Kentucky… a seventeen-mile move that likely landed them on the tariff list, due to Kentucky’s strong support in the election for President Trump.  Ohio was targeted too, but a larger segment of manufacturing was targeted there. (Cleveland.com)

These are the sort of businesses that are going to be hurt by the tariffs; combining a large capital expenditure with a sudden loss of international buyers will damage companies like this (especially those that have to pay more for products like paper, because of the American lumber tariffs, so production costs rise just as sales decrease.)

We’re already seeing the effects of tariffs, as Tiff wrote about earlier.  With the addition of the Canadian duties, we will be seeing more of those effects.

For the sake of those who hate links, here are some of the items which now will be taxed:

Various forms of shaped metal and wire

Yogurt

Whiskey

Playing Cards (as mentioned above)

Strawberry Jam

Dishwashers

Toilet paper

Gherkins

Sailboats

Dishwasher Detergents

Refrigerators

Peanut Butter

Chocolate

…the list goes on.  And if the President responds in the way he’s threatened in the past, with even higher taxes, the retaliatory tariffs will likely rise again.