Trump claims for putting tariffs on Canada
Donald Trump claims the United States has been subsidizing Canada.
In December 2024, Trump said the United States was subsidizing America’s northern neighbor by the large figure of $100 billion dollars a year. That number jumped to $200 billion in late January at the World Economic Forum.
Despite Trump’s claims that the United States is subsidizing Canada, a trade deficit is not the same as a subsidy.
TD economists Marc Ercolao and Andrew Foran noted in a January 21st report that “rather than a subsidy, the U.S. trade deficit is a by-product of U.S. economic outperformance relative to other countries.”
Canada exports more goods to the United States than it imports, but this relationship works out well for the American economy and should not be seen as a subsidy, CBC News explained. Yet that isn’t how Trump has been operating.
I think that in Trump's mind, he sees trade as a zero-sum game," Concordia University economics professor Moshe Lander told CBC News. "He's just hearing the word deficit. And that's the end of his math calculation."
The US imported $412.7 billion dollars in goods from Canada while Canada imported a total of $349.4 billion in goods from the United States, putting the American trade deficit with Canada at just $63.3 billion in 2024.
Ercolao and Foran also noted that the numbers Trump and his team are quoting are “4 to 5 times the official reported statistics.”
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