Trump Rejects Canadian Negotiator, Threatens to Tax Canadian Cars
President Donald Trump said Canada "doesn't seem to want to move" in NAFTA negotiations, and told reporters, "I must be honest with you, we're not getting along at all with their negotiators. We don't like their representative very much." Bad blood between U.S. Trade Representative Robert Lighthizer and Canadian Foreign Minister Chrystia Freeland has long been a source of chatter in the trade world (see 1808020032), though some say it's not personal, it's because Canada is standing firm on its priorities.
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Trump said he refused to meet with Canadian Prime Minister Justin Trudeau because Canada won't drop its quota and tariff system on dairy imports. A representative for Trudeau denied Trudeau requested a meeting, and declined to comment further. "We're thinking about just taxing cars coming in from Canada. That's the mother lode. That's the big one," Trump said. "We're very unhappy with the negotiations and the negotiating style of Canada."
As Trump trashed NAFTA, and said 25 percent of the U.S. auto industry has been lost to Mexico because of the free trade agreement signed 25 years ago, he softened slightly on his messaging on Canada. He said there's a "good chance still" of reaching a deal with Canada, but cautioned it won't be "anything near what they want to do." As for approving a Mexico-U.S. free trade agreement, Trump said, now it's up to Congress.
Trump, who was speaking at a late afternoon press conference in New York Sept. 26, also touched on trade negotiations and trade imbalances with South Korea, Japan and China. He called the rewrite of the U.S.-Korea Free Trade Agreement a tremendous deal, and said the previous version was "totally defective." He bragged about Japan promising to buy more liquefied natural gas. "You have to do me a favor. We don't want these big deficits. You're going to have to buy more," he said he told Japanese Prime Minister Shinzo Abe. "They're buying massive amounts of equipment and military equipment, and other countries are doing the same thing. Because we have trade imbalances with almost everybody. It's a rare exception that we don't."
Trump said that China wants Republicans to lose in the mid-term elections, because they're angry that the U.S. is pushing back on its trade practices. The White House pointed to the fact that agricultural products from states that are Republican strongholds were subject to Chinese retaliatory tariffs. However, agricultural products from California and Washington state have also been on Chinese lists, as have other commodities, such as scrap metals, which are not particular to Republican districts.
Trump repeatedly pointed to tariff revenue as a win for the U.S., whether it would be because of tariffs on Canadian autos or the tariffs on Chinese goods. Tariffs are paid by U.S. importers, and to some degree, U.S. consumers, not by foreign countries. "And [China tariffs have] had no impact on our -- absolutely, by the way, no impact on our economy, which I said it wouldn't," he said.