Mulcair: Could there be progress on the tariff front?

Tom Mulcair is brought to you by Guaranteed Industries, a and can era brand worth promoting with high efficiency furnaces and heat pumps, called Guaranteed Industries at 51434 to 3400, serving Montrealers since 1957. Good morning, Tom.

Good morning. Happy Friday, Andrew. Happy Friday. It's tariff eve. And I wanted to something that jumped out of me yesterday. This was from Howard Lutnik. Did we find it? Anthony? No, I didn't. Okay. But I've got the I got the text here. Howard Lutnik, the Commerce Secretary United States. Yes.

And he was talking about the tariffs and how the tariffs, you know, and then there's because of the flood of drugs and illegals and this and that. And he said something that made me like, say, what? Okay. He said, phase one is essentially the emergency action to deal with fentanyl crisis. You know that the drug labs in Canada are run by Mexican cartels.

respect america respect america if we are your biggest trading partner show us respect shut your border and uh... and fentanyl coming into this country now i listen i where are all these uh... where are all these that drug factories making fentanyl run by mexican cartels there between donald trump's ears but rock i'm gonna say something positive about that let me he was clearly signaling that this is a game that has to be played he said things like look

We've had reciprocity and we've gotten along on trade for 150 years. I see no reason why that shouldn't continue. But the president has said that this and this and this is happening. And therefore, we have to address that concern. There are a couple of different things that play here. One is obviously for the American audience. Two is that Trump naively believes that tariffs just drop money into the US Treasury instead of understanding that this just adds costs to US consumers.

But at the same time, the game that's being played here is, of course, completely contrary to the new version of the North American Free Trade Agreement, the US, Canada, Mexico agreement that Donald Trump put together and signed. But he needs an excuse to break it. So his excuses are going to be national security issues. So this is why he came up with this invention that somehow Canada is responsible for the fentanyl crisis in the States. American and Canadian experts agree

Canada represents maximum 1% of the federal going into the United States, and we are not a major source of people crossing the border to get into the U.S. illegally, but he has to play that game. He thinks he's going to be getting free money into the United States coffers. Of course, we're preparing for that, and I have to give a tip of the hat. Melanishely on this issue has been very strong. She's been there nonstop. Her lines have been perfect.

And I think that the message is starting to get through, but when you listen to someone like Latinx who is very smart and deeply experienced and who knows what he's doing. And you listen to somebody like Marco Rubio who's also very experienced.

They're both giving the same type of signal. This is a game that we have to play. You guys have to say, oh, yes, well, we're acting. We've got two new Black Hawk helicopters for the RCMP, and we're spending $1.5 billion over the next two years to deal with the border issues. It's a game. It's phony. It's a dumb game because it's dangerous for our economy, but Trump doesn't see it as a problem for him. It could be because, like we did the last time, almost all of the aluminum that gets used in every

product in the United States comes from Canada because we have cheap electricity, which is the main ingredient in aluminum. We don't have a pound of bauxite, which is the raw material. But the other thing that goes into aluminum is cheap, clean electricity. We've got tons of that. And that's why this is not going to go on forever. We do have ways of answering it.

But as Philip Kuiar sagely warned this week, it's mathematically impossible, Andrew, for Canada to win a trade war with the US. So we've got to try to avoid it at all costs. They're talking about government to help financial help to businesses that might be affected. Wouldn't it make more sense to spend the money on the border and the military, like the US wants, than to just throw some money at failing businesses, because affected by tariffs?

Yes. And with regard to the NATO stuff, he doesn't even talk about that because one of the things, of course, the Canada could do would be to withdraw from NORAD, which is extraordinarily important in terms of security for the United States, because you might have noticed the Canada is the whole northern part, and we can see stuff coming into law better than they can. But what makes sense doesn't really pertain here.

You know, the Canadian government is reacting to something we are way behind on NATO that is a blame that will be born for a long time by the Trudeau regime. I mean, it's just an abject failure for which there's no excuse. And it's a shame because Canada always had a good track record. We're an original signing of the NATO treaty. And we've just completely led down the side. But with regard to anything else that we can do, I mean, on the board, think of this, Andrew, OK, 100% of the handguns

that are used by street gangs across Canada that come in from other countries. 100% comes in from the United States. What would the American reaction have been if Trudeau held a press conference saying, I'm going to punish you with tariffs. If you don't stop handguns from coming into Canada, it goes back to something you said a couple of weeks ago. Hey, isn't the United States responsible for its borders? Canada is responsible. We're doing nothing to stop the handguns from coming in. And that's a huge problem.

But it's not the Americans' problem to take care of the handguns. And they would have laughed us out of the room if we had tried that. This is what Trump is trying with us. He says, it's your problem if I have fentanyl on the streets in the US. But it's a condition precedent to him being able to tear up the current trade deal between Canada and Mexico and the U.S. among Canada.

Mexico in the US. Tom, we've been talking about February 1st, a tariff day as if it's like a snowstorm coming or something like that. But really, how is this going to? What are we going to see initially? How are they going to? How are these tariffs going to be charged if they are charged? What immediate effect will there be? I mean, it's hard to get your wrap your head around it. Well, think we're the middle of winter. So think agricultural produce, you know, we're going to start stopping. We're going to start

saying that their stuff can't come in or it'll come in with a huge tariff. The stuff that we send down there every day, parts for cars, aluminum and steel, some of our raw materials, nickel. We provide 95% of the nickel used in the United States. So we could stop some of that stuff. They say they're going to be taxing everything that comes across the border. That's what it

It's a tax. They think it's going into the coffers. It's just going to go into the price for American consumers. The only thing that Trump has hinted at, he might give us a break by not applying 25% to Canadian oil. He's not giving us a break. He knows that he'd get clobbered by American consumers who would get hit by a $1 a gallon increase at the pump in the US.

So he's going to try to weave his way around that. Canada's going to come up with a list of things that will hurt American companies in Republican states as much as possible and make those Republican legislators howl to trump tobacco. Okay, just so I'm clear on this. Okay, so I'm sending, you know, I have an aluminum plant, Andrew's aluminum plant.

up in the Saginaw and I'm sending a $100 worth of aluminum down to Michigan. So when 125. So it costs the Americans in Michigan $125 instead of $100. Yes, exactly. And 25 bucks goes into the US coffers. But the cost that was born by, let's say, the appliance manufacturer that's using aluminum, well, the cost, if that aluminum represents half the cost of a product,

But then the cost of that product has just gone up 12.5%. That's going to be just passed along straight to the consumer in increased prices. And that's what Trump apparently has trouble understanding.