Associated Press, by Josh Boak
WASHINGTON (AP) — President Donald Trump said Tuesday that he doubled planned tariffs on Canada’s steel and aluminum from 25% to 50%, escalating a trade war with US north neighbours, and has not been exposed to recent stock market turmoil and increased risk of recession.
Trump said on social media that the increase in tariffs set to take effect Wednesday was a response to rising prices in which the Ontario government provided electricity sold to the US.
“I have directed the Secretary of Commerce to add an additional 25% tariff to 50% on all steel and aluminum coming to the US from Canada, one of the highest tariffs in the world,” Trump posted on Truth Society on Tuesday.
After a brutal stock market selling on Tuesday sparked even more uncertainty, Trump is probably facing an increasing pressure to show that there is a legitimate plan to grow the economy rather than pushing it into a recession. But so far, the president has doubled the tariffs he repeatedly spoke during his 2024 campaign, plunging the once-stable economy into complete disruption as investors hoped to lead in deregulation and tax cuts instead of huge tax cuts.
The US president has given various explanations about his hostility in Canada, saying his separate 25% tariffs are related to fentanyl smuggling and opposition to Canada, which places a high tax on imports of dairy products that fine U.S. farmers. However, he continued to seek Canada as a solution to become part of the United States. This is a type of provocation that has infuriated Canadian leaders.
“The only thing that makes sense is that Canada will become our precious 50 first state,” Trump posted Tuesday. “This will create all the tariffs and eliminate all else entirely.”
Canadian Prime Minister Mark Carney said Tuesday that he will maintain tariffs until Americans show respect and commit to free trade after his government threatened Canada’s historic financial destruction.
Carney, pledged in the coming days by Justin Trudeau, said Trump’s latest tariffs were an attack on Canadian workers, families and businesses.
“My government will maintain tariffs until Americans show respect for us and demonstrate a reliable and reliable commitment to free and fair trade,” Carney said in a statement.
Canadian officials are planning retaliatory tariffs in response to Trump’s specific steel and aluminum tariffs, scheduled to be announced Wednesday.
Kearney has retaliatory tariffs worth Canada’s first $30 billion (US$21 billion) applied to items such as American orange juice, peanut butter, coffee, appliances, footwear, cosmetics, motorcycles and certain pulp and paper products.
Ontario Prime Minister Doug Ford said on MSNBC on Tuesday that Americans and their business leaders should oppose the “mixed” caused by the launch of Trump’s trade war.
“When you’re in a recession, it’s made by one person. It’s called the Trump recession,” Ford said. “We shouldn’t do this. Both countries should be booming.”
The US president condemned the “use of electricity as a negotiation tip and threat,” and in another social media post Tuesday, Canada said, “The more we pay a large financial price for this, the more we will be read in history books for years to come!”
Ontario provided electricity to Minnesota, New York and Michigan, and Trump has pledged to declare a national emergency in these states.
Trump also suspended taxes on imports compliant with the 2020 USMCA trade agreement for a month, but targeted Mexico with 25% tariffs due to complaints about drug trafficking and illegal immigration.
When asked if Mexico is facing the same 50% tariffs as Canada, President Claudia Sinbaum said, “No, we are respectful.”
Trump was set to deliver on Tuesday afternoon to Business Roundtable, an industry association of CEOs who had pledged during the 2024 campaign with promises to lower corporate tax rates for domestic manufacturers. But his tariffs on Canada, Mexico, China, steel and aluminum can plan more on Europe, Brazil, South Korea, medicines, copper, wood and computer chips, but will be a massive tax hike.
A vote of trust in the stock market over the past two weeks has left the president tied to his enthusiasm for taxing imports and his brand as a politician who understands business based on his own experiences in real estate, media and marketing.
Harvard economist Larry Summers, former Treasury Secretary of the Clinton administration, brought the possibility of a recession to 50-50 on Monday.
“With a focus on tariffs, ambiguity and uncertainty, demand has cooled and prices have risen,” Summers posted on X.
Investment bank Goldman Sachs revised its growth forecast for this year from the previous 2.2% to 1.7%. The probability of a recession has increased to 20%.
Trump tried to assure the public that his tariffs would cause a bit of a “transition” into the economy. Taxes will allow more businesses to begin a long-standing process of relocating their factories to the US to avoid tariffs. However, he raised the alarm in an interview that aired on Sunday.
“I hate predicting that kind of thing,” Trump told Fox News’ Sunday Morning Futures. “What we do is so big, there is a transition period. We bring wealth back to America. That’s a big deal. And there is always a period – it takes a little time. It will take a little time. But I don’t – I think it should be great for us. In other words, I think that should be great. ”
The promise of great things in the future did not rule out anxiety. The S&P 500 Stock Index fell 2.7% on Monday due to an unmistakable Trump slump that wiped out the profits of the market that won his victory in November 2024.
Trump has long relied on the stock market as an economic and political measure, but appears to ignore it as it has remained so far determined to impose tariffs. When he won last year’s election, he declared that it was believed to have started on November 6, 2024, rather than on January 20, 2025, but on Election Day, to allow stock market profits to be recognized.
Trump also repeatedly warned of economic freedom if he lost the election.
“If I can’t win, you’ll have 1929 style depression,” Trump said at an August rally in Pennsylvania.
Fabiola Sanchez contributed to this report from Mexico City. Gillies was reported from Toronto.
Original issue: March 11, 2025 10:20am EDT
