We do have a Trade Deficit with Canada, as we do with almost all countries (some of them massive). P.M. Justin Trudeau of Canada, a very good guy, doesn’t like saying that Canada has a Surplus vs. the U.S.(negotiating), but they do...they almost all do...and that’s how I know!
— Donald J. Trump (@realDonaldTrump) March 15, 2018
According to the U.S. trade representative office, American goods and services have a $12.5 billion trade surplus with Canada in 2016.
In an audio recording obtained by The Washington Post, Donald Trump admitted he told Canadian Prime Minister Justin Trudeau that America has a trade deficit when he "had no idea" if that statement was true.
After a back and forth on whether the U.S. has a trade deficit, Trump said. "He said, 'Nope, we have no trade deficit.' I said, 'Well, in that case, I feel differently,' I said, 'but I don’t believe it.'"
The U.S. ran a $2.77 billion surplus with Canada for 2017, according to the Commerce Department. Trump mentions a $17 billion trade deficit figure thanks to "energy and timber" on the tape. The Commerce Department figures include oil and timber. Facts are facts. Feeling differently is not based on facts.
This CBC News report excerpt might shed some off-colour light:
U.S. Trade Representative Robert Lighthizer has been including goods that pass through Canada but don't originate here as Canadian exports in his export calculations, artificially inflating the U.S.'s trade deficit in goods with Canada, sources told CBC back in February.
For example, a Chinese washing machine that passes through the port of Vancouver on its way to the U.S. is being counted as part of both the U.S. trade deficit with China and the U.S. goods deficit with Canada.
Maybe not fake news, but clearly fake numbers, if the sources information is correct.
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The proposed tariff on steel and aluminum did send flutters through the Canadian steel and aluminum industries. Canada now has a waiver on the proposed tariffs. but this unsettling manner is disruptive to business on both sides of the border.
A prime example of the unsettling manner is Trump's blackmail statement that the tariffs would disappear if he got what he wanted in a new NAFTA deal. Kudos to Trudeau and Foreign Affairs Minister Chrystia Freeland, who is leading the NAFTA negotiations for Canada for standing their ground.
Trump has held out the threat of discarding NAFTA over Canada's head during the negotiations. The U.S. trade people have thrown in outlandish requests by every objective standard. Like or hate NAFTA, there is a bipartisan coalition in Congress that will not let go of NAFTA. Unlike Mexico, if NAFTA disappeared, the two countries would go back to the U.S.-Canada Free Trade Agreement. Former PM Brian Mulroney was on the task of building both agreements and is on Trudeau's team in the negotiations.
Trump also has a phobia about multi-country agreements whereas Canada has a new trade deal with the European Union and a new and improved Trans Pacific Partnership (TPP).
The negotiation trade agreements is a complex concept. Trump doesn't deal well with the simplest concepts such as telling the truth on trade deficits.
Twitter capture: @realDonaldTrump
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