New York caught in middle of Trump’s trade war with Canada

President Donald Trump has gotten himself and the U.S. in a tangled trade war with Canada while belittling its leaders and sovereignty. He’s focused on the possible return of economic activity his tariffs might bring, but business leaders are gravely concerned with what this might mean, not just for commerce but for the longstanding ties between New York, Ontario and Quebec. What happens if our friendly neighbors to the north stop seeing us as friends?

In a fight nominally over border security, Trump has already issued 25% tariffs on many Canadian goods, including aluminum and steel, and 10% tariffs on energy, which have left states like New York, coincidentally under Democratic control and in his crosshairs, to brace for very real economic impacts as the country in general experiences fiscal headwinds. 

Gov. Kathy Hochul and state lawmakers have expressed concern about how the trade war with Canada might affect the state’s agricultural industry and ratepayers’ wallets; The governor has directed the state Department of Public Service, Department of State and Energy and Research Development Authority to examine the full effects of the tariffs on New York; those agencies estimated that the cost of electricity could increase by $42 million per year and the cost of heating oil could increase by $57 million per year.

New York politicians respond

In Congress, members of New York’s delegation with districts bordering Canada have predictably split down party lines when discussing what the tariffs mean for their constituents. Democrats have hammered home both the negative economic impact on New Yorkers and how this will fray the centuries-long relationship between New York and Canada. 

“All these tariffs will do is destroy centuries of goodwill between our neighbors, create a new consumer tax on Americans who are already struggling to make ends meet, and cost jobs,” Western New York Democratic Rep. Tim Kennedy said in a statement. “I am doing everything I can to pressure President Trump to stand down from his trade wars, otherwise hardworking families will pay the price.”

Neighboring Republican Rep. Nick Langworthy characterized the tariffs as a necessary evil to compel Canada to take border security more seriously. “When they were going to feel it from the pocket, then they got serious about it,” he said in an interview with WRGZ. North Country Republican Rep. Elise Stefanik has been mum on the issue as she prepares to leave Congress to become U.N. ambassador.

Relations between New York and Canada have always been pleasant, and business leaders want it to stay that way. 

North Country Chamber of Commerce CEO Garry Douglas said he suspects that Republican elected officials are privately communicating to the White House that the tariffs need to be reconsidered. According to Douglas, the North Country gets most of its building materials and farming supplies from Quebec, a large portion of its energy from Canada and all of its natural gas from across the border. He calls it a “post-trade relationship.”

“I would equate anything less than a full reconsideration and reversal of these tariffs on Canada as being like the guy who was being hit on the head by a hammer every five minutes, and now he starts being hit on the head by the hammer every 10 minutes instead,” Douglas said. 

Chris Kirkey, director of the Center for the Study of Canada and Institute on Québec Studies at SUNY Plattsburgh, said it may fall on Hochul to remind the president of the economic realities of the situation. The governor has already met with Trump more than once since he’s taken office. “I would expect that Governor Hochul will in the weeks to come, if these tariffs continue to play out, increasingly voice concern about, is this the way to go?” Kirkey said. 

Kirkey warned that Canadian business and government interests will look elsewhere if they can no longer trust that New York, and the U.S. more generally, will be reliable trading partners. Newly minted Canadian Prime Minister Mark Carney just visited the United Kingdom and France, and Kirkey said that trip wasn’t just about policy. 

“He's in Europe, in part, to sort of not only speak to his government's principal objectives but to talk to trade partners such as France and the UK about deepening trade relations and diversifying greater trade relations so that Canada isn't so overly reliant on the United States,” he said. “Sometimes it may cost you to do that, but if your trade partner is proving to be unreliable, well then you look elsewhere.”

Maple Leaf fury

Unsurprisingly, Canada hasn’t taken kindly to the tariffs or to Trump’s insistence that they should be annexed by the U.S. and become “the 51st state,” and Canadian politicians, businesses and consumers are struggling to figure out how to react to Trump’s belligerent attacks. 

The Canadian government has issued its own retaliatory tariffs on $29.8 billion worth of American products and threatened to increase them further if need be. Ontario Premier Doug Ford all but declared war on New York, threatening to cut off power provided by his province before eventually walking things back and speaking to Hochul. 

Quebec Minister of International Relations Martine Biron has taken a more conciliatory approach, telling City & State in a recent interview that the relationship between New York will ultimately endure, even if the current geopolitical situation results in both countries facing temporary hardships. “The exchange with New York is about $11 billion each year,” she said. “So it’s important. It’s an integrated chain of supply, so we need to work together. And if the tariffs are on and we break this chain of supply, it’s going to be difficult on both sides of the border.”

But Trump doesn’t see it that way. “With Canada, we don’t need their cars, we don’t need their lumber, we don’t need their energy. We don’t need anything from Canada, and yet it costs us $200 billion a year in subsidies to keep Canada afloat,” he told reporters on Friday. “So when I say they should be a state, I mean that. I really mean that.”

In fact, Ontario is one of New York’s most important trading partners. Daniel Tisch, director of the Ontario Chamber of Commerce, is well aware of the gravity of the situation. “The interdependence is huge,” Tisch said. 

But he said that Canadian businesses and the public want a way to express their frustration with the U.S. government, and the most straightforward way to do that is with their wallets. Tourism is already seeing an impact from the trade war – and not just because the Canadian dollar is set to take a hit. 

“You see people saying, I'm not going to travel to the U.S., I'll stay within Ontario or Canada or go somewhere else. You see it growing by Canadian sentiment. You see boycotts,” Tisch said. “And so, you know, while I'm optimistic that at some point there'll be some sort of deal that's done, in some ways, the damage has already been done, and the reputation, the impact on the reputation of American goods and services, that'll take years to repair.”

Even with the contingencies being mapped out, though, decoupling from New York isn’t the most immediately attractive solution for many. and although there's a border extending from the Great Lakes to Lake Champlain, for some, like Michel Beval, president of the American Chamber of Commerce of Canada’s Quebec chapter, cultures and communities supersede that. 

“We are neighbors, we are allies. We're partners. We have a history together. Canada was there when there was the 11th of September,” Beval said. “When all those planes stopped in Halifax and different airports, Canadian families received people that were on the plane and they couldn't go to the United States, received them at their house. We fought with each other during World War Two, recently in Afghanistan. So with all of that history, I don't understand why we put tariffs.”