David Lin gives the whole episode to the collapse of the US-Canada trade talks and the tariffs that followed, building it out of clips of Mark Carney, Doug Ford, Canada's trade minister, the leader of the opposition and the US vice president, wrapped in his own explainers on who pays a tariff, which provinces lose the most jobs, and why the automobile threat is the one that matters. He closes with a clip of BCA Research's chief geopolitical strategist arguing that both governments are fighting because it is election season.
Host: David Lin
Also on: Mark Carney, prime minister of Canada; Doug Ford, premier of Ontario; Dominic LeBlanc, Canadian trade minister; Pierre Poilievre, the Conservative leader; JD Vance, vice president of the United States; and Matt Gertken, chief geopolitical strategist at BCA Research — all in clips Mr. Lin plays
Published: 29 August 2026 on The David Lin Report feed
Watch on YouTube | Apple Podcasts | 32 min
✅ Time saved: 14 min
Key Takeaways
Canada is matching Washington's tariffs dollar for dollar, and the list runs past 700 products
Rates of 15%, 25% and 50% take effect on September 8, against US tariffs on more than 550 categories of Canadian goods worth about $20 billion a year
"We cannot accept what they've offered and we will not give what they've asked." — Mark Carney
Canada's real leverage is energy, and Carney said so out loud
99% of American natural gas imports, 85% of electricity imports and 60% of crude oil imports come from Canada
Ontario's premier says the provinces can inflict serious damage and is daring Washington to test it
"we could put massive, massive pain on the US" — Doug Ford, naming electricity, fuel, potash and uranium
The talks died over what Washington added at the end, not over dairy
Late US demands touched Canada's freedom to sign trade deals with other countries and its French-language and cultural protections
A University of Calgary economist puts the job exposure at just over 87,000 once indirect work is counted
52,000 directly, and an unemployment rate moving from roughly 6.4% to about 6.8%
Ontario about 36,000, Quebec about 18,000, British Columbia about 11,000, Alberta about 9,000
A tariff is a bill paid by the American importer, not by Canada
A US company importing a $100 Canadian product at 50% owes $50 to the US government
The escalation that matters is automobiles in January, not the current $20 billion package
Canada is roughly 13% of US vehicle and auto parts imports, and components cross the border several times before a car is finished
The Bank of Canada is being pushed both ways at once
US tariffs cut growth while Canadian retaliation lifts import prices
Tariff costs are not showing up in foreign export prices, which means Americans are paying them
Over $150 billion in tariff revenue collected, with importers' pre-tariff stockpiles delaying the pass-through
BCA Research reads both governments as playing to their own voters
Four-fifths of the trade is untouched because it moves under the USMCA, and the auto tariffs are dated after the midterm
Canada matches Washington dollar for dollar, on more than 700 American products
Mr. Lin opened with the sequence. On Tuesday, August 25, Canada announced retaliatory tariffs on roughly $20 billion US of American imports, after President Trump imposed 50% tariffs on a similarly valued basket of Canadian goods the previous weekend. The Canadian measures take effect on September 8 and apply rates of 15%, 25% and 50% to more than 700 US products, including steel, dairy, electronics, appliances, agricultural equipment, pulp and paper, seafood and other consumer goods. Ottawa says the package is designed to match Washington's new tariffs dollar for dollar, and Mr. Lin said he would link the full product list in the episode description because of how detailed it is.
The American tariffs took effect at 12:01 a.m. on August 22 and cover more than 550 categories of Canadian goods
About $20 billion US a year, which Mr. Lin put at roughly 5% of Canada's exports to the United States
The list runs from honey and wine to clothing, furniture, electronics, cosmetics, sporting goods and hockey equipment
Mr. Carney had already telegraphed the response the day the US tariffs landed
"So last evening I instructed our negotiators to return to Ottawa. We cannot accept what they've offered and we will not give what they've asked."
"Canada will match Washington's new tariffs dollar for dollar in order to protect Canadian workers, farmers, families, and businesses."
The prime minister named the sectors in advance — steel, dairy, appliances, agricultural equipment, pulp and paper, electronics — and said the measures would come into force the Tuesday after Labor Day
Carney's answer to the trade-deficit argument is the energy Canada ships south
Mr. Lin set up the American justification for the tariffs — that the United States runs a trade deficit with Canada and is therefore being ripped off — and answered it in his own voice: the narrow merchandise deficit exists only because the US buys so much of its energy from Canada. He then played Mr. Carney making the same point with numbers attached.
"Canada fuels American growth, supplying 99% of their natural gas imports, 85% of their electricity imports, 60% of their crude oil imports." — Mark Carney
"I don't think they want us to stop sending any of that energy."
Mr. Lin's read on that last line was blunt. He called it a threat, and said Ontario's premier had made the same threat in plainer English
Doug Ford says the provinces can put "massive, massive pain" on the US
Asked what "worse" would look like and whether he had a line in mind, Mr. Ford said everything stays on the table.
He would not speak for the other premiers but said a couple of them "have a lot of power to protect Canada. Massive power."
"we need everyone to be on team Canada and throw everything in the kitchen sink at them" — Doug Ford, naming electricity, fuel, potash and uranium
He wants buy-in "from coast to coast to coast" before any of it is used
"we could put massive, massive pain on the US. They underestimate — President Trump underestimates us and that's the biggest mistake underestimating your opponent."
Trump answers on Truth Social, and Ford answers back
Mr. Lin read out two of the president's posts. The first said the United States was giving serious consideration to renaming Lake Ontario, and Mr. Lin said plainly that he did not know whether it was serious.
"The United States is giving serious consideration to changing the name of Lake Ontario to Lake America and that we don't expect to be doing much business with Ontario any longer." — Donald Trump, read by Mr. Lin
The earlier Monday post called Mr. Ford's remarks "lots of bluster" and described him as "the less charismatic, intelligent, and overall unimpressive brother of the late great Rob Ford"
It called the prime minister "Governor Carney" and Mr. Ford his flunky, said the electricity, oil and gas Canada gets is transported through the USA, and claimed Canada's unemployment rate "is now at 10% and rapidly rising"
"Someone should get these clowns to fall into line or the consequences for Canada will be far worse."
Mr. Ford's reply was personal and aimed past Mr. Trump at American voters. Asked whether the prime minister had told him to tone down a radio remark about Mr. Trump kissing his backside, he said no, and that the prime minister "wasn't against that"
"I have more courage, more brains in my baby toe than he has in his whole body. But I'm not going to take any advice off a guy that's the king of bankruptcies."
"And he's actually tariffing his own people, taxing his own people." He said he would communicate through the US media and reach out to every governor, senator and member of Congress
"And when it comes to the midterms, I have a message to the Americans. Don't vote in a person that's going to kill your jobs." — Doug Ford, who added that jobs went down in the US while Ontario created more
"I got skin on me like an alligator. And you think an insult from him hurts me?"
Ford's case for fighting: the alternative is watching the industrial base go
A reporter, Siobhan, asked whether hitting back that way makes Ontarians and Canadians more vulnerable to an unpredictable president. Mr. Ford said the choice is between fighting and being taken over.
"We either roll back and let him take over our country, watch the steel sector bleed out, watch the auto sector bleed out, the auto part manufacturers bleed out, all the manufacturers bleed out. That's his game."
He said Canada is "an economic powerhouse" and that the president's real object is the auto sector
"I'd love to see him run cars without any oil."
LeBlanc traces the breakdown to a July threat and a three-day extension
Mr. Lin played Canadian trade minister Dominic LeBlanc on CNBC, answering a question about what went wrong in the talks — the interviewer noted that neither side agrees on what the sticking point actually was.
"President Trump at the end of July had threatened 50% tariffs on about 28 billion Canadian dollars of exports to the United States. That would have been 40 to 50,000 jobs in our country put at risk." — Dominic LeBlanc
That threat sat on top of the existing Section 232 sectoral tariffs on steel, aluminum, automobiles and, in Canada's case, softwood lumber
It is what triggered the intensive round of negotiations that later collapsed
Mr. LeBlanc said his counterpart, US trade representative Jamieson Greer, had been "professional, accessible" and had acted in good faith throughout
The two governments were not describing the same thing in the final week. Mr. Trump extended the deadline by three days because he believed a deal was done; Ottawa was more guarded
"We were more careful. We said we're close to a deal. We're making real progress."
At the Friday deadline Mr. Carney concluded he did not have a deal that was in the country's economic interest
"Canada's in a different economic position than other trading partners, the most important customer of the United States, but the most integrated in supply chains, particularly in these sectors."
Poilievre wants the rejected text published
Not everyone in Canada backs the retaliation. Mr. Lin noted that Conservative leader Pierre Poilievre has been calling for the Liberals' trade deals with the US to be audited, and played his response.
Mr. Poilievre said Conservatives are ready to join all parties "to lock arms and fight for affordability, for jobs, and for the country that we love," and wants Parliament recalled to work
"Release the proposed text. There are no national secrets in that text." — Pierre Poilievre, arguing the US administration and its negotiators have already seen it
He tied the demand to trust, saying transparency was especially important "after the government gave false information about the Gordie Howe Bridge," where the truth only emerged once the agreement was released
What each side says the talks actually broke over
Mr. Lin laid out both accounts in his own voice. Mr. Carney says the proposed agreement would have required Canada to surrender too much control over its trade policy, its key industries and its domestic cultural protections. The Trump administration says Canada kept discriminatory barriers against American autos, dairy and alcohol and did not concede enough.
The dispute sits on a broader deterioration since Mr. Trump returned to office in 2025. The US had already imposed or threatened tariffs on Canadian steel, aluminum, automobiles and other goods, and Canada had answered with counter-tariffs, before the two sides began moving toward a larger agreement through July and August
Washington's specific complaints: that Canada's tariff rate quota system disadvantages US cheese exporters, that Canadian provinces pulled American liquor from government-controlled stores during the earlier confrontation, and that Canadian retaliation hit American-made cars
Canada had already put real concessions on the table, by Mr. Carney's account
Remove the remaining Canadian retaliatory tariffs on steel, aluminum and autos if Washington substantially reduced its own
Encourage the provinces to return US alcohol to store shelves, and make changes to dairy supply management
Canada's stated goals were tariff-free access for most exports, lower American tariffs on key industries, protection for smaller businesses and more certainty for companies on both sides
The deal came apart on terms Washington added at the last minute. By August 18 the talks were far enough along that Mr. Trump postponed implementation by three days; days later Mr. Carney said the US had introduced new terms that changed the economics and the political character of the agreement
The new demands touched Canada's ability to pursue future trade relations with other countries — Mr. Lin's own read was that this meant China — and its French-language and cultural protections
"the United States proposed new terms that were uneconomic, unfair, and undermined the net benefits for Canada and called into question the reliability of any deal. In short, they asked too much and they offered too little." — Mark Carney
Washington disputes the account. Mr. Greer has defended the US position, saying it had already offered substantial tariff relief and blaming Canada's long-standing retaliation and trade restrictions
Vance tells Maine that only Canada and China fought back
Mr. Lin played the vice president making the administration's case from a border state.
"Really, the only two countries that have really retaliated against the United States have been Canada and China." — JD Vance, who called Canada one of the main trade violators anywhere in the world
He argued the dependence runs one way — "they rely on Maine a lot more than Maine relies on them" — and framed the tariffs as forcing Canada to give Maine businesses the same treatment Canadian firms get
"And yeah, we've got to play a little hard ball to get to that fairness."
The legal route to 50% is a 1930 statute nobody uses
Mr. Lin walked through the mechanics. Late on Friday, August 21, Mr. Carney suspended the talks and ordered his negotiators home, saying the last-minute changes were unfair and uneconomic. Hours later the US tariffs went into force.
Mr. Trump invoked Section 338 of the Tariff Act of 1930, which Mr. Lin described as a rarely used depression-era law allowing duties of up to 50% on imports from countries deemed to discriminate against American commerce
The damage does not stop at the tariffed goods themselves. Mr. Lin said economists warn the consequences extend well beyond the nominal value of the affected exports, because those exporters also buy transportation, financial, accounting, logistics and other services across Canada
A Calgary economist maps the job exposure, and Ontario carries the largest hit
The show's own research leaned on University of Calgary economist Trevor Tombe, whose estimates Mr. Lin presented with a provincial map.
Roughly 52,000 Canadian jobs are directly at risk from the new tariff round
Counting indirect employment in trucking, warehousing, wholesale distribution, professional services and supply industries, the total climbs to just over 87,000
On Mr. Tombe's numbers that would move Canada's unemployment rate from roughly 6.4% to about 6.8%
Mr. Tombe's own caution is that the national effect is limited while the local effect is not, because most Canada-US trade still falls outside the new duties
The provincial split, as Mr. Lin read it off the map:
Ontario carries the largest absolute hit at approximately 36,000 jobs, on a manufacturing economy deeply integrated with the US across machinery, manufactured goods and furniture
Quebec is second at about 18,000, concentrated in manufacturing, furniture, wood products, food processing and textiles
British Columbia faces one of the sharpest increases in effective tariff rate — roughly 7 percentage points — with about 11,000 jobs exposed in wood products, furniture and manufactured goods
Alberta's direct increase is about half a percentage point, yet about 9,000 Alberta jobs are still affected, which Mr. Lin attributed to how interconnected the domestic economy is
Ottawa answers with $7.5 billion and a push to sell somewhere else
Canada paired the retaliation with money and a strategy.
A $7.5 billion support package for affected Canadian businesses and workers, on top of nearly 25 billion Canadian dollars Ottawa says it has already committed over the broader trade confrontation
The government is accelerating efforts to diversify exports away from the United States and to increase trade between the provinces
"We cannot control the storm blowing in from Washington." — Mark Carney, quoted by Mr. Lin, whose broader argument is that Canada can no longer assume the relationship with Washington works the way it historically did
A tariff is a bill the American importer pays
This was Mr. Lin's own explainer to the audience, and he ran it with an arithmetic example.
Tariffs are not costs paid by foreign governments. They are collected from the importers
A US company importing a $100 Canadian product subject to a 50% tariff owes $50 to the US government
That importer can absorb the cost, demand a lower price from its Canadian supplier, or raise the price to American customers — in practice, analysts expect the burden to be split between businesses and consumers
The Associated Press expects the latest tariffs to push American consumer prices up as importers pass at least part of the cost through
Housing and construction are the most visible case, because Canadian lumber and wood products are important inputs and US housing affordability is already strained
Electronics, furniture and household goods get more expensive too
US inflation is still well above the Federal Reserve's 2% target, and Mr. Lin cited analysts quoted by Business Insider warning that tariff-driven inflation could complicate the Fed's ability to cut rates and, if it persists, add pressure for tighter policy
He added one line of context from outside North America: the Iran war is still at a stalemate and the Strait of Hormuz is still closed
The escalation that would really hurt is automobiles in January
Mr. Lin was explicit that the current package is small relative to the whole relationship, and that the danger sits in what comes next.
The $20 billion tariff package is relatively small compared with total bilateral trade
Mr. Trump's threat to put 50% tariffs on Canadian vehicles and components in January has already rattled automotive suppliers
Fitch Ratings analyst Olu Sonola warned that prolonged uncertainty could significantly disrupt the North American auto supply chain and potentially force a major realignment of Canada's auto industry
Canada accounts for roughly 13% of US vehicle and auto parts imports, and hosts many plants belonging to American manufacturers
There is no clean dividing line between an American and a Canadian car. A component can enter a US factory, return to Canada for more assembly and cross again before the finished vehicle reaches a dealership — so a tariff applied repeatedly along that chain compounds
The Bank of Canada gets pushed both ways at once
US tariffs weaken Canadian exports, corporate profits, investment and employment. Canadian retaliatory tariffs simultaneously raise the cost of imported American goods
Growth falls while some prices rise, which Mr. Lin named for what it is: stagflation
If the unemployment effects compound, the Bank of Canada may face pressure to cut rates
If retaliation keeps pushing inflation up, easier policy becomes a hard choice
The Canadian dollar could also come under pressure if investors expect slower growth or weaker export demand
Two economists from earlier episodes on what the tariffs have already done
Mr. Lin played clips from previous guests on the show. Neither is named in the episode, so the claims below sit with the show rather than with a person.
The first speaker rejected Treasury Secretary Scott Bessent's framing that this is China against the rest of the world, pointing to the past six to eight months with Canada and the attempt to acquire Greenland
"Right now, America has lost its prestige and its standing in world affairs."
"I'm very worried not just about inflation in America. I'm worried about stagflation." — the same speaker, who named Mr. Bessent, Howard Lutnick and the president as leading the economy down a dangerous path and called the deficit a false metric for the health of the economy
His summary of conditions: prices going up, companies not hiring, debt too high, and a president so polarizing that businesses do not want to invest and consumers do not want to spend. He volunteered that he is not against Mr. Trump and prefers him to the alternatives
The second speaker's concern was that markets are not pricing the tariffs at all
Forward tariff rates are close to where they were in April, when equities sold off and credit spreads widened — and yet the market is at all-time highs with narrow spreads
"my general view is that there's more risk from tariffs than is probably being priced in"
"there's not much sign that foreign exporters are absorbing the cost which means most of the tariff revenue is coming from some combination of American consumers and American businesses" — he noted import prices are measured pre-tariff and are not falling
Importers front-ran the tariffs by pulling extra goods into the first quarter, which bought them a buffer before passing costs on; he put reported Treasury tariff revenue at over $150 billion
He described the result as a new annualized multi-hundred-billion-dollar tax split between American consumers and businesses, and said the trade deals mostly resolve into lending rather than investment — the Japan deal being his example
His closing point was about which companies the damage lands on. Ford talks about tariffs and Microsoft does not, and Microsoft is something like 100 times Ford's market capitalization while not employing twice as many people
So the harm shows up in the economy rather than in the index, and he put himself in the camp expecting gradually decelerating US conditions
Gertken: both governments are running a turnout operation
Mr. Lin asked whether this is bluster on both sides before another de-escalation, and played Matt Gertken, chief geopolitical strategist at BCA Research, saying it is.
"let's bear in mind about four-fifths of the trade between these two giant trading partners is not suffering tariffs because it's under the US-Mexico-Canada Agreement, the trade agreement that Trump himself negotiated" — Matt Gertken
Because Mr. Trump negotiated it, Mr. Gertken said, he does not want to get rid of it and is willing to renew it every year
That leaves the remaining 15% or 20% of goods as the only material available to tariff, and the president is not going to touch critical minerals or fuel, oil being one of the largest imports from Canada
"he's doing it because it's small enough that he doesn't think it's going to have a big impact on the election"
On Mr. Gertken's read the motive is turnout: approval ratings are poor, so the play is nationalism to get a disenchanted Republican base to vote, given that Democrats will turn out and independents are moving the other way
"Well, pick a fight with the neighbor, rally around the flag, and highlight the trade issue, the protectionism issue, which has motivated his base in the past."
The auto tariffs are the tell. Mr. Gertken pointed out they are dated January 1, after the midterm — "and he probably won't actually do them"
The same logic runs north of the border. Mr. Gertken said Mr. Carney is in a strong position because the fight unites Canadians, at a moment when Alberta and Quebec are, as he put it, flirting with secessionism again
He does not think either province will act on it, and said rallying around the flag against an American president attacking the Canadian economy and Canadian sovereignty is one way to make sure the momentum never builds
Mr. Gertken's is the bottom line the episode ends on: with four-fifths of Canada-US trade still moving tariff-free under the USMCA, energy and critical minerals deliberately left alone, and the automobile tariffs scheduled for the far side of the midterm elections, the fight is sized for two domestic audiences rather than for the trade balance.
Products, Companies & Tools Mentioned
BCA Research (Matt Gertken's firm; his read is that the tariffs are calibrated to be small enough not to move the election)
Fitch Ratings (Analyst Olu Sonola warned that prolonged uncertainty could disrupt the North American auto supply chain and force a realignment of Canada's auto industry)
Ford and Microsoft (Used by an earlier guest as the contrast that matters: Ford talks about tariffs, Microsoft does not, and Microsoft is roughly 100 times the market cap without employing twice as many people)
The Gordie Howe Bridge (Poilievre's example of the government giving false information about an agreement, and his argument for releasing the rejected trade text)
Books & Resources Mentioned
Trevor Tombe's tariff-exposure analysis, University of Calgary (The source for the 52,000 direct and 87,000 total jobs at risk, the 6.4% to 6.8% unemployment path, and the province-by-province map)
The full list of US products facing Canadian tariffs (Mr. Lin says he has linked the complete list in the episode description, calling it extensive and very detailed)
Apple Podcasts (The episode on Apple)
Episode page (The show's own page for this episode)
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