Paul Teller - Will Trump's Canada tariffs help America?

President Trump is imposing 50% tariffs on most Canadian imports, arguing Canada has unfairly treated American industries for years. Will the tougher approach strengthen U.S. manufacturing and trade, or leave consumers paying higher prices? Paul Teller is President of Teller Strategies. He joins the show to discuss the new tariffs, U.S.-Canada trade, and what the policy could mean for American businesses and families. 

Transcript

SPEAKER_00 0:08

Welcome back to the Lawrence Larson show. It's a pleasure to be with you. Well, President Trump is raising tariffs on most Canadian imports to 50 percent. Is that going to level the playing field for American business or just drive up prices for consumers? I thought we'd test that notion on Paul Teller, who's president of Teller Strategies. Paul, welcome back to the program. How are you?

SPEAKER_01 0:29

Oh, how are you? Great to be with you, as always.

SPEAKER_00 0:31

I'm not a big fan of tariffs in general, and I've said that, and people said, well, but what about Trump? What Trump is doing? I figured I uh way back when he began this about a year and a half ago, it's only been a year and a half with the Trump the new Trump administration. I figured he's using it to negotiate with other countries, and it seems he has been. Although some of this uh seems to be producing, we've gone from being a net food exporter or sorry, importer, to now we we are just barely a net food exporter, and that changes happen relatively quickly. Are these tariffs a good idea?

SPEAKER_01 1:04

No, again, appreciate it. Thank you. And I frankly, I'm with you. My my gut instinct is that these are not great. Um, I think in general, right, uh many of us on this show or listening to this show are free marketeers, right? We want the government as much out of uh the business of of private transactions as possible, right? Don't set the prices, because that's what tariffs are, right? Tariffs are basically the government saying, I don't like the price of that good. I think that price should be higher, and slapping, you know, whatever the the extra percentage on top of it to increase the price. Otherwise, why do it, right? If the price isn't going to go up, you you wouldn't need a tariff. So, I mean, that's to me, that's like too much government meddling in general. But here, I think you're right also. I have a feeling this really is just the president at the administration saying, yeah, we're in the middle of some uh Canada negotiations, uh, we're angry at the smoke, right? The wildfire smoke that came across the United States. Let's, you know, let's do this little shot across the bow. Gives us a good negotiating position to come down off of. Because if you look at it too, uh, first of all, the the tariffs didn't go into effect yet, right? They gave it kind of a month to go into effect. I think August 19th is when they go into effect.

SPEAKER_00 2:10

Yep.

SPEAKER_01 2:10

And they did carve out a few major industries. Uh I could be wrong here, but I think it's critical minerals, certain energy sector, um, I think maybe even lumber, you know, some other key things where it's like, uh-huh, all right. So why would you carve out those critical industries if you thought the tariffs were so great, right? So they're basically saying, all right, we're we we get that this is probably harmful and we're gonna negotiate down from them, but you know, this is what's happening. And also if you really wanted them to go into effect, they would go into effect, right, right away. The fact that they said, we're gonna give you a month's lead time to think about it, talk about it, let's work on it, probably speaks to your point that these are you know negotiating tactics.

SPEAKER_00 2:48

Yeah, because you are right, Paul, that they've excluded from the 50% tariffs energy, potash, which is, I think, involved in fertilizer, then fish and critical minerals. But does Canada allow all of our goods into its country unfettered? Because my r my recollection from the beginning of the Trump administration was that our dairy products going into Canada are severely restricted, whereas Canada's dairy products coming into the United States are not. Why don't we just have both countries agree we're not going to tariff things at all? We'll let the marketplace decide. Do Canadians want to drink American milk or do Americans want to drink Canuck milk?

SPEAKER_01 3:27

Exactly. And you're totally right. And it was absolutely worse before uh the Trump Hans USMCA went into effect during the first administration, you know, US Mexico-Canada trade agreement. No question. And it it equalized it somewhat, improved it somewhat, but you're also right. That didn't solve the whole problem. You know, there's still some inequities. And in fact, that's the the law the president and the administration are citing for this action. I think it's uh section 338, if I'm getting my numbers right, of the tariff act from the 2013. This is 338. This is going way back. Is it 338? Okay, yeah. Yeah. 338. Um, basically saying if a country discriminates against U.S. commerce, you know, the president gets to come in with just kind of minimal um, you know, time for review or for appeal or anything like that, just to come in and you know impose some duties. It's not used that often because again, normally you're supposed to prove that like an entire country is discriminating against our entire commerce kind of as a whole. And I think that's hard to say in this case, right? Canadians are still importing tremendous amount of American goods. So a little tough to use that logic, I think, but I think that's what they're they're at least starting with.

SPEAKER_00 4:33

And by the way, you mentioned the forest fires. I actually think Trump's being, and I I call him out as a hypocrite, uh, because America has not done a fantastic job of managing its forests or wildfires. So when Canada catches fire and Trump says, hey, you guys aren't managing your forests, well, the federal government is one of the biggest offenders in America in not managing its federal forests and letting them catch fire. So it's a bit like the pot calling the kettle black.

SPEAKER_01 5:02

No, that that is true. Let's face it. Anytime there are wildfires in America, and it seems to be every single year, let's face it, um, uh right, we we conservatives are very quick to jump and say, uh-huh, see, especially on federal lands, they're not managing it well, they're not allowing clearing out, the environmentalists are allowed too much sway and all that kind of stuff. And so you're right, we we've gotta we've got to criticize ourselves the way we criticize them. Uh having said that, from what I understand, I could be wrong, but what I understand, some of those Canadian fires have been burning for like two months straight or something. And it's like, okay, wait a minute. I don't think we're really doing that in the United States. Like, just let it burn out for two months.

SPEAKER_00 5:41

I get it, Paul. I live on the West Coast of America. The West Coast catches fire almost every year. And they do have they there have been some famous examples in the last less than 10 years where they start with a fire that's a quarter of an acre, which is tiny. You know, that's 10,000 square feet. It's like a decent sized house lot. And they say, well, it'll probably go out on its own. And then within a few weeks, it's 300,000 acres of fire. So the United States is guilty of that. Plus, I mean, we can we can criticize other governments all day long, but you know, I've literally seen fires where they'll say, Well, yeah, there's a fire there, and we'd go put it out, except uh, you know, and then they start drawing lines. They say, This is a county, this is a state, that's BLM, this is Forest Service. I'm sorry, it's on the wrong, it'd be like a cop standing on one side of the street watching somebody be robbed or or beat up on the other side of the street and said, My jurisdiction ends at the middle of the street, I'm not allowed to help out. Nobody would accept that.

SPEAKER_01 6:45

Right. You're exactly right. And that's unfortunate if if that is happening to a significant extent. I've heard that too, so you're exactly right. And that's very, very unfair and unfortunate. There's got to be some you know interoperability there, no question. Because the fire is a firefire.

SPEAKER_00 6:58

Do you think the new government of Canada, I mean, they're they they they didn't go with uh Polyev, who I thought would be would have made a a great prime minister. They went with another knucklehead. Uh is Canada gonna get things straightened out and maybe start playing ball?

SPEAKER_01 7:11

You know, I I sure hope so. I think they're hopefully getting uh some of the message here, and I I know they do want to repair some of the the the you know the rift, shall we say, in the relationship. But you know, at least the Canadians I speak to, both in and out of the Canadian government, you know, they don't like when there's tension between the two countries. I mean, there's a natural uh alliance, a natural friendship here and and natural trading relationships. So uh they do want things to better. So that's why I'm hoping that uh, you know, while we may not love this shot across the bow from President Trump, you know, they'll see it for what it is, go shating tactic, and let's get uh let's get two dies and tariffs down across the board as far as we can.

SPEAKER_00 7:49

And by the way, Paul, I in some ways there's a little bit of Schadenfreude on my part. You look at the East Coast complaining about smoke and say, we get that every year, and you guys never pay any attention to it. Now that it's happening to you, hey, take a good smell of it. That's what happens when government does things badly. Paul Tiller from Teller Strategies, back in a moment.