Standing in an aisle of the Grant Park liquor mart on Saturday night, I found myself in the grips of a dilemma.
I took a long, hard look at a 2023 unoaked Napa Valley Chardonnay and wondered if — given U.S. President Donald Trump’s impending tariff campaign — I should put it back on the shelf in a quiet act of protest.
It was pretty clear at that moment that most provinces were likely going to pull American booze from government liquor stores. On Sunday, Manitoba Premier Wab Kinew added this province to the list.
A section of American wines at a Liquor Mart in Winnipeg on Sunday. Products from the U.S. are set to be pulled from the stores starting Tuesday.
Could I, simply by turning my back on a bottle of chardonnay, help Canada’s cause in an unprecedented trade war?
Turns out that we Canadians buy a lot of American alcohol.
Ontario, the largest single purchaser of alcohol in the world, each year sells about $1 billion dollars in U.S. wine, beer and spirits. Even in tiny Manitoba, liquor marts and private wine stores sell roughly $80 million worth of American booze. If all provinces follow suit, it’s going to cause a lot of grief for a lot of U.S. wineries, breweries and distilleries.
Of course, this is a war that is going to extend far beyond alcohol.
Given that Trump is applying a blanket 25-per-cent tariff on all Canadian imports, this week should see a flurry of countervailing measures. Ottawa has already announced a 25-per-cent tariff on about $30 billion worth of various goods. Another $125-billion in tariffs will come later this week, along with support programs for Canadian businesses and workers.
Even with these measures, winning a trade war with Trump is highly unlikely. Still, leaders like Kinew are clinging to the idea that doing something is better than nothing.
“Now that the fight is here, a fight that we did not ask for, we have to stick up for ourselves.”– Manitoba premier Wab Kinew
“Now that the fight is here, a fight that we did not ask for, we have to stick up for ourselves.”
Kinew is not wrong, but neither is he being naive about the consequences of returning fire at the Trump administration. Even in the best case scenarios, once tariffs and countervailing tariffs are in place, the value of currency and GDP in the countries involved will go down, while inflation and unemployment will be on an upward trajectory.
It is that inescapable reality of a trade war that Kinew and other Canadian leaders hope will resonate with Trump. At some point, the theory is that even a leader as unpredictable as Trump will realize tariffs inflict nearly as much damage on the economy of the country that enacts them as it does on the other countries involved. And that somehow, the economic stress caused by the tariffs and counter-veiling tariffs will prompt Trump to back down.
That’s what a rational person would do. But then again, we’re not dealing with a rational person.
We find ourselves in the unenviable position of trying to preach logic to a man who has rejected conventional logic. Trump’s tariff plan ignores the established rules of both economics and mathematics. It is a strategy based on a hilariously erroneous theory, pumped full of deliberately erroneous numbers, that promises totally unachievable results.
It’s going to be very hard to scare someone into backing down if they simply won’t acknowledge the peril they are facing.
Remarkably, there is actually some reason for optimism. Not that Trump will wake up and smell the economic theory of tariffs. But that he can be nudged into retreat. In fact, there are already some instances where he has backed down under acute domestic pressure.
Take Trump’s executive order to cease all distribution of international aid for 90 days while funding programs are reviewed. Although ending foreign aid is a core precept of the ultra-nationalist, anti-globalist MAGA warriors, it’s really unpopular with other constituencies. Like farmers.
For nearly 100 years, the U.S. federal government has paid American farmers to grow crops specifically to donate as humanitarian aid. Less food aid means less money flowing into the pockets of farmers. And that has already ramped up the heat on the Trump administration.
Under pressure from members of congress, humanitarian groups and agricultural lobbies, U.S. Secretary of State Marco Rubio has already started back-tracking. Initially, Rubio had only exempted programs providing emergency food and military aid to Israel and Egypt. Since the executive order was signed, however, Rubio has approved waivers for programs that provide life-saving medicine, medical services, food, and shelter.
It’s going to be very hard to scare someone into backing down if they simply won’t acknowledge the peril they are facing.
The smart money is that over the next year, Trump will find one or two smaller NGOs to punish, allowing the vast majority of foreign aid to continue to flow. It’s a scenario that many in Canada, China and Mexico hope will unfold on the trade front.
Over the next weeks and months, industries and employers under stress will reach out to their members of congress, who will take it up to party leadership, who will then take it to an audience with the president, who (one hopes) finds some way to reverse course and save face.
It can be done, but it will be tough sledding.
For the record, I bought that bottle of Napa chardonnay. But I’m not going to drink it until the trade war is over.
We all have to make sacrifices.
dan.lett@freepress.mb.ca
Dan Lett
Columnist
Dan Lett is a columnist for the Free Press, providing opinion and commentary on politics in Winnipeg and beyond. Born and raised in Toronto, Dan joined the Free Press in 1986. Read more about Dan.
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