Senator says tariffs a wake-up call for Canada

DES MOINES – Iowa Sen. Chuck Grassley said U.S. President Donald Trump’s threat to hit an array of Canadian goods with new tariffs should serve as a “wake-up call to Canada to make some changes.”

“I think the president is probably using them as a lever,” Grassley said Friday in an interview with The Canadian Press at the Iowa State Fair in Des Moines.

While the senior Republican has been a key backer of Trump’s agenda on Capitol Hill, he also has continued to voice his support for free trade despite the president’s growing tariff regime.

Grassley said there’s nothing wrong with Canada and the United States having tough negotiations but they can’t be allowed to undermine the trilateral trade agreement known as CUSMA.

“These negotiations cannot be used as a way of destroying (CUSMA),” Grassley said.

Canadian officials have intensified trade talks with their American counterparts in recent weeks after Trump signed an executive order to impose 50 per cent tariffs on a range of Canadian goods starting Aug. 19.

The Trump administration says the new duties are a response to provincial bans on U.S. liquor, Canada’s supply-managed dairy system and quotas on certain U.S. vehicles.

Several provinces pulled American booze from shelves last year after Trump imposed tariffs on Canadian goods.

United States Trade Representative Jamieson Greer, who was also at the Iowa State Fair on Friday, called the talks with Canada “constructive” but gave no sign that a deal might emerge in the days before the new duties take effect.

Unlike most of Trump’s other tariffs, the new duties would have no exemptions for goods that comply with the continental trade pact.

CUSMA was negotiated during the first Trump administration to replace the North American Free Trade Agreement. The sometimes volatile negotiations served as a key test for Ottawa but ultimately all three countries came to an agreement.

The Trump administration said in July it would not be extending CUSMA for another 16 years. That triggered an annual rolling review process that will continue for a decade, at which point the deal would expire if the three countries do not agree on an extension.

Trump has cast doubt on the future of the agreement, calling it “irrelevant” and saying it may have served its purpose.

Mexico and the United States have begun official CUSMA negotiations, but no such talks have started between Ottawa and Washington. Political observers say that Trump’s latest tariff threats are meant to force Canada to the table.