MICHEL MARTIN, HOST:
Canada is striking back in a trade war with the United States.
STEVE INSKEEP, HOST:
The country plans to raise tariffs on almost $20 billion worth of U.S. products in two weeks, and that mirrors President Trump's latest import taxes on Canadian products brought to the United States. In a moment, we'll ask Democratic Representative Debbie Dingell of Michigan how much damage these two trading partners might do to each other. We begin with the latest news.
MARTIN: NPR's Stephan Bisaha is following all this and how this is affecting businesses on both sides of the border. Good morning, Stephan.
STEPHAN BISAHA, BYLINE: Good morning.
MARTIN: How widespread are these Canadian tariffs?
BISAHA: Yeah. It's pretty wide. I mean, there are about 700 American products on this list. Some getting tariffed as much as 50%. We are talking steel and aluminum to dairy and toilet paper. Also, agricultural equipment and American motorcycles, lots of fish, even protein powder's on there.
MARTIN: OK. This actually seems like kind of a random collection of goods.
BISAHA: Yeah.
MARTIN: So how - do we know how they ended up with this list?
BISAHA: Yeah. Canada basically chose these goods so they would add up to a specific amount, close to $20 billion worth of U.S. exports into Canada each year. It is not a coincidence that this is also the value of goods the U.S. is tariffing coming out of Canada. That list stretches from hockey sticks to wine to false beards. So also pretty seemingly random collection.
This is all part of a tit for tat back and forth after trade negotiations between the two sides fell apart on Friday. Leaders from both countries are also taking verbal shots at each other. President Trump accuses Canada of ripping off the U.S. with longstanding trade restrictions on U.S. goods like cars, planes and cheese.
Canadian Prime Minister Mark Carney, for his part, accused the U.S. of making last-minute changes in the trade talks that he said were unfair and uneconomic. And this is also a rare example of a foreign leader standing up and opposing Trump rather than trying to appease him.
MARTIN: OK. So let's take this from both sides. What do these latest tariffs mean for the U.S.?
BISAHA: Well, 20 billion won't have a huge impact on the U.S. economy. Canada will feel a little bit more because their economy's smaller, and these goods aren't targeting, like, some of the biggest exports and imports between these countries. But if the trade war ratchets up and brings in other goods like American cars and Canadian oil, that could have a much bigger effect.
But, you know, for businesses who've been dealing with a year and a half of tariff ups and downs now, this is a lot of uncertainty. Like, I was talking with Marc Bowker. He owns Alter Ego Comics in Lima, Ohio. And when he's ordering action figures for his store, that can require ordering them 18 months in advance.
MARC BOWKER: If that dollar amount is going to change in what either the customer has to pay or what I'm being charged by my supplier, that makes things significantly more difficult.
BISAHA: Really impossible to plan around all these tariff changes. He's also worried about tariffs possibly hitting comics. They are not on the list yet, but most comics are exported from Canada. So if this trade war keeps ratcheting up, comics, and with them, Marc's shop, could get dragged in. Just like, you know, things like tracksuits and wallpaper got dragged in.
MARTIN: But, like, who knew that most comics are exported from Canada. Wow.
BISAHA: Yeah, right?
MARTIN: So...
BISAHA: Lesson for me.
MARTIN: Right. So the Supreme Court ruled that some of Trump's tariffs were illegal back in February. So what is the legal justification for his latest tariffs?
BISAHA: Yeah. The Supreme Court ruled Trump's broadest tariff tool was illegal and shouldn't have been used in the first place. So the president's grasping at other trade laws to try and rebuild his tariff options. In this case, he's using Section 338 of the Trade Act of 1930. And don't worry about remembering those specific numbers in that name but do remember that lets Trump put up to 50% tariffs on countries who discriminate against U.S. trade. Now, this tariff law could also face legal challenges, but don't expect the courts to act fast. So for now, we are stuck in an escalating trade war without any sign of compromise.
MARTIN: That is NPR's Stephan Bisaha. Stephan, thank you.
BISAHA: Thank you. Transcript provided by NPR, Copyright NPR.
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