Canada Hits US With New Tariffs as Trump Threatens Worse

Canadian Prime Minister Mark Carney is preparing his most aggressive move yet in a rapidly worsening trade fight with Donald Trump, with Ottawa set to unveil retaliatory tariffs against the United States on Tuesday. The planned announcement would mark a sharp escalation after trade talks collapsed Friday, just hours before Trump’s 50 percent tariffs on $20 billion worth of Canadian goods were scheduled to take effect. Trump has warned Canadian officials to “fall in line” or face consequences “far WORSE” than the current levies, while Carney has framed Canada’s response as a necessary act of self-defense. “You’re at war when you’re attacked, and we got attacked,” he told Canadians. “We’re going to hit back.” Trump, in turn, accused Canada on Monday of taking advantage of the U.S. for years. “Canada has been ripping off the United States for years,” he wrote on Truth Social. “On trade, and in other ways, also, they are among the worst nations in the world to deal with. They feel entitled and yet, WE DON’T NEED CANADA, THEY NEED US!”

Earlier Monday, Carney signaled that Canada may shift away from a dollar-for-dollar tariff response and instead pursue more strategic countermeasures designed to shield Canadian workers and key industries. He said Ottawa would not accept what he described as “an attitude at the negotiation table that Canada is a subsidiary of the United States.” Speaking in French, Carney delivered an even sharper assessment of the failed talks. “We learned during the negotiations that the Americans want to destroy our major industries, including autos, steel and aluminum,” he said. “That was one of the main reasons we said no. It was a bad deal.”

Carney’s stance represents a striking act of resistance from a smaller country long viewed as one of Washington’s closest allies. Fen Hampson, a professor of international affairs at Carleton University in Ottawa, told The Washington Post that the prime minister is trying to overturn long-held assumptions in the U.S. capital. “Carney is signaling to Washington that the old assumption that Canada is a country that will accommodate, that we will go along to get along, it is no longer true,” Hampson said. “Because Carney’s very polite and professional, they thought that he would be a pushover.” Carney won office on a pledge to stand up to Trump, who throughout much of his second term has floated the idea of Canada becoming “the 51st state” while repeatedly threatening new tariffs.

The rhetorical backlash has not been limited to Ottawa. Ontario Premier Doug Ford launched his own broadside at Trump, telling the president to “kiss my [expletive]” and warning that his province could cut electricity exports to the United States if the White House keeps targeting Canadian industry. As tensions deepened Monday, Ford said Canada should be prepared to “throw everything in the kitchen sink” at Trump. “He’s arrogant.” “He’s cocky,” Ford said during a radio interview shortly after Trump announced fresh tariffs aimed at Canada’s auto sector.

Ford also underscored Ontario’s leverage as a major power supplier to the U.S. “We power 1.5 million homes and businesses,” he told the Associated Press in a separate interview. “Everything’s on the table. I’ll do whatever it takes.” He added that Trump “better have a pack of batteries.” Trump fired back online with a personal attack, describing Ford as “the less charismatic, intelligent, and overall unimpressive brother of the late, great, Rob Ford,” while again mocking Canada’s prime minister as “Governor Carney.”

“The USA will always be far bigger, richer, and stronger than Canada,” Trump wrote. Ford brushed off the insult and suggested he was ready for a prolonged fight. “If you think an insult from him hurts me? Well, bring it on, buddy, I´m ready.” Vice President JD Vance also weighed in during remarks in Maine on Monday, saying, “Canada and China have been the two worst countries when it comes to trade policy anywhere in the world. What a shame that is. I would not expect that from Canada,” before referring to Canada as “a state” and calling the remark “a Freudian slip.”

Vance further claimed that Canada would be vulnerable to foreign invasion “were it not for the umbrella of protection from the United States.” In Ottawa, Finance Minister François-Philippe Champagne and three other Cabinet ministers are expected Tuesday morning to outline support measures for workers hit by the tariffs. The escalating language on both sides illustrates how quickly U.S.-Canada relations have deteriorated since Carney abandoned the negotiating table. The two countries share one of the world’s largest trade relationships, with deeply intertwined supply chains spanning autos, energy, agriculture and manufacturing. A prolonged tariff battle could carry heavy costs for companies and workers on both sides of the border.

U.S. Trade Representative Jamieson Greer argued Monday that “the only reason Canada has auto production in the first place” was the 1960s Auto Pact, which used Canadian market access to encourage vehicle production north of the border. Carney, meanwhile, questioned whether Washington could still be seen as a reliable partner, saying Canada was finding dependable allies “everywhere in the world, except in the United States and Russia.” He warned that the U.S. proposals for the auto sector would gradually dismantle Canadian manufacturing. “This is the most successful automotive partnership in history,” Carney said, referring to the highly integrated Canada-U.S. auto industry now at the center of the dispute.

Ford is a Progressive Conservative whose party differs from that of Carney, a Liberal, but the two underscore broad political unity in Canada over the trade fight with Trump. Ford said ‘everything is on the table’ if the dispute worsens, including cutting off electricity and critical minerals from Ontario. Critical minerals are increasingly important to US national security and manufacturing. The Pentagon has sought more secure supplies of minerals used in military aircraft, missiles, munitions and electronics as Washington tries to reduce reliance on China, which dominates the mining or processing of several strategically important minerals.

Ford said Canada should also consider increasingly severe retaliation if Trump continues targeting Canadian industries, including oil and potash, while Ontario could raise electricity prices or stop sending power south. Ford has used electricity as leverage before. During an earlier phase of the dispute, Ontario imposed a 25 percent surcharge on electricity exported to Michigan, Minnesota and New York. Trump responded by threatening to double tariffs on Canadian steel and aluminum before both sides backed away . Ford accused Trump of not simply seeking a better trade deal but aiming to hollow out Canadian industries and move production south.

Ford said Trump wants to make Canada a vassal state. ‘He wants to bleed out every single sector and bring them down to the U.S.,’ Ford said. Ford said he understood Washington had sought language late in the negotiations that would have restricted Canada’s ability to negotiate trade agreements with other countries without US approval. Carney has called that demand unacceptable and a question of Canadian sovereignty. The prime minister said the dispute also exposed a deeper divide over language and culture, saying protections for French and Canadian culture that Washington views as trade irritants are considered fundamental rights in Canada.

US and Canadian officials negotiated for roughly a month before the agreement, which both sides said was close, broke apart just before the finish line last week. Trump had extended the negotiating window on August 19, when the tariffs were originally due to take effect, saying it was ‘based on the fact that Canada and the U.S.A., subject to the finalization of documents, have a DEAL!’ But the extension failed to produce a deal, with Washington and Ottawa now blaming each other for the collapse.

American officials blamed Canada for introducing new demands late in the negotiations, including calls for lower rates on heavy trucks. ‘Despite the US offer to Canada to receive the best treatment of any major exporter to our market, new demands and walk backs of other commitments by Canada have upended the careful balance reached in the past days,’ said Greer. ‘Canada declined to finalize the trade deal under the terms agreed earlier this week.’ Carney and other officials have in turn blamed the Trump administration for changing its demands. ‘Canada will match those tariffs dollar for dollar to protect our workers and businesses,’ Carney said in a statement on Saturday shortly after the new rates went into effect.

The PM said its retaliatory tariffs targeting US goods would go into effect on September 8. The new rates target US steel, dairy, agricultural equipment and other sectors. The fallout could raise prices further ahead of the midterm election as US voters are already wary of inflated costs. In 2025, the US and Canada traded an estimated $869.7 billion in goods and services, according to the USTR. Concerns over the economy have come to the forefront of US politics ahead of the US midterm elections.

A July Gallup survey found that 22 percent of respondents rated the US economy as ‘excellent’ or ‘good.’ Another 32 percent of respondents called the economy ‘fair’ and 44 percent described it as ‘poor.’ Meanwhile, Democrats across the country have honed in on this concern and campaigned on making things more affordable. Prediction markets Polymarket and Kalshi show Democrats favored to win control of the House in the midterms, while Republicans retain a narrow edge in the Senate. If Republicans lose either chamber, Trump could face greater difficulty advancing his policy priorities through Congress, as legislation would require support from at least some Democrats.