Is Carney finally standing up to Trump?

Editor's note: Radhika Desai, a special commentator for CGTN, is a professor of political studies at the University of Manitoba in Canada. The article reflects the author's opinions and not necessarily the views of CGTN.

Canada hardly ever hits the international headlines but did this past Saturday. Newspapers worldwide headlined that Prime Minister Mark Carney pulled out of trade talks with the US, declaring that his country was "at war" with the US, that Canadian sovereignty was at stake, that the US was offering Canada "a bad deal" and that "We cannot accept what they offered and we will not give what they asked." The New York Times described Carney's speech as "muscular" and "electrifying" while The Telegraph said Carney offered Europe a "template for resistance."

So, is a hitherto faithful ally finally breaking ranks with the odious Trump administration? Not so fast.

Elected to stand up to Donald Trump in April 2025 when Trump's aggressive behavior towards Canada – calling its Prime Minister "Governor" and Canada the 51st state – prompted deep and wide revulsion among Canadians, Carney government's record has been one of capitulation to Trump. On climate, this former UN climate envoy and advocate of net zero finance, cancelled Canada's carbon tax and removed emissions caps. On military spending, Carney agreed to the new 5% of GDP NATO spending demands. 

Very little of the Carney government's recently tough rhetoric is reflected in the substance of Canada's position. Since Trump's election and abusive behavior towards Canada, there has been much talk of diversifying Canada's trade but little action. If trade diversification is to mean anything, it must mean deepening trade and economic relations with China. However, notwithstanding a successful visit to China in January this year, Carney's government has been dragging its feet on this matter, with Carney even claiming in January that Canada was not pursuing any such deal, clearly to assuage Trump who had just threatened to slap 100% tariffs on Canada if it did so. The free trade deals Canada is pursuing instead with a motley and unsurprising crew of other nations are hardly going to compensate. 

Most Canadians want effective trade diversification. Not so, Canada's business leaders, part of the wider Western "globalizing" elite, whose interests this former governor of the central banks of Canada and England, former Goldman Sachs executive and card-carrying "Davos Man" represents. They have, over recent decades, only intensified Canada's integration with the US economy with the signing of the 1988 Canada US Free Trade Agreement, followed by the 1995 North American Free Trade Agreement, now renamed the United States-Mexico-Canada Agreement. 

With more than three quarters of Canada's exports going to the US and nearly half its imports coming from there, Carney has promised little more than to double Canada's non-US exports by 2035. This is too little too late. Rather than diversifying trade, Carney has prioritized attracting foreign investment. This appears good only at first glance. A closer look reveals three things. Most of these involve mergers and acquisitions of existing Canadian firms, putting their ownership in foreign hands. More than half of the investment comes from the US, which makes a mockery of reducing reliance on that country. Finally, Carney has been using the crisis created by the election of Trump only to advance the neoliberal agenda of ever greater freedom for unproductive, financialized corporate capital, precisely the opposite of what Canadians need and want.

Finally, in addition to Canada's reliance on the US, there is the reverse: As Carney noted, Canada supplies the US with "99% of their natural gas imports, 85% of electricity imports, and 60% of crude oil imports" and is the largest customer of US cars. Undoubtedly, both countries know that there will be some sort of resumption. Canadian business leaders are already lamenting the fracas, and one Canadian commentator already sees a "tiny window that offers the faint possibility that an all-out trade war… could be averted" in that Canada's retaliatory tariffs don't go into effect until September 8, giving time for some sort of resolution to emerge.

Two weeks may not seem a long time, but these two cover August, part of the "silly season" and September, when the Western world returns to work and suddenly the pace of events picks up.  Not only could anything happen, Carney is likely betting on it.

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