The United States is in an escalating dispute with ... Canada? The two nations have been clashing over trade policy in regard to the lumber and dairy industries, with the US slapping tariffs on timber from its second-largest trading partner and President Trump sounding off on what he views as unfair practices. A look at what's going on:
- Trump and Trudeau spoke by phone Tuesday, and the US and Canada then issued two very different readouts, notes Business Insider. The US deemed it "amicable" in a short synopsis, while Canada's went into more detail and complained about "unfair" American actions and "baseless" accusations.
- The Washington Post explains the wonky dairy dispute. It notes that Canada's industry "is one of the world's most highly protected," and US farmers think it unfairly freezes them out. One recent sticking point revolves around a cheese-making product called ultrafiltered milk. It was a money-maker in Canada for US farmers until the Canadian government reclassified it and made it subject to heavy import taxes, reports Slate. Canada, for its part, thinks the US floods the global market with too much milk.
- As for lumber, one key difference explains the problem, per the Atlantic: US lumber companies generally harvest trees on private land, while Canadian companies do so on public land. US companies say this amounts to a subsidy that allows Canadian firms to flood the US market with cheap wood.
- A post at the Canadian site Maclean's thinks Trump is going to go after wine sales in British Columbia next, arguing that the Canadian product has an unfair advantage over US wine because of grocery store rules.
- These disputes actually go back decades, flare up occasionally, and generally are worked out quietly, explains the New York Times. This public flap, however, sets the stage for upcoming NAFTA negotiations.
- A story at Politico suggests that Canada is an easy target because it can't retaliate. Plus, Trump "has a chance to look tough and decisive on the international stage as he tries to renegotiate NAFTA, one of his big campaign promises."
- Commerce Secretary Wilbur Ross describes the problems from the US point of view in this video.
- Canada's foreign minister suggested that instead of imposing retaliatory tariffs, Canada would take the US to international court, reports CNN. "When it comes to defending Canada's economic interests, we're going to play hard," said Chrystia Freeland.
- Bloomberg interviews Trudeau about all this and his dealings with Trump, and he compliments Trump for being a good listener. "He has shown that if he says one thing and then actually hears good counterarguments or good reasons why he should shift his position, he will take a different position, if it’s a better one, if the arguments win him over."
- Another piece at Bloomberg notes that the US might want to worry about Mexico. It spends $1.2 billion a year on US dairy, twice as much as Canada, and it appears to be looking for new trading partners as relations with the US sour.
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