In his latest provocative maneuver, President Trump has imposed sweeping tariffs on imports from Canada and Mexico claiming that these measures will “protect” America from an alleged surge of illegal immigration and the flow of deadly drugs such as fentanyl. Although he has delayed these tariffs, a closer examination of the facts suggests that these declarations are less about national security and more about an aggressive recalibration of international trade – one that carries as many risks for the U.S. as it does for its closest ally.

Central to Trump’s current trade policy is his use of the International Emergency Economic Powers Act (IEEPA). The IEEPA was originally enacted in 1977 to empower the president to address “unusual and extraordinary” threats to national security, foreign policy, or the economy. Historically, it has been employed to sanction regimes or organizations that pose genuine security risks. For example, following the Iran hostage crisis, President Carter used IEEPA to freeze Iranian assets held in the U.S., and after September 11, President George W. Bush invoked the act to block the financial networks of terrorist organizations. In both cases, the actions were targeted and supported by clear evidence of an external threat. By contrast, Trump’s invocation of IEEPA on Canada marks a significant departure from precedent. It does not address a clear-cut case of national security. Instead, these tariffs serve as a tool of economic coercion.

As for his justification for the tariffs, Trump has repeatedly asserted that Canada and its North American neighbours are the conduits for illicit drugs entering the U.S. For Canada, the rhetoric implies it has been remiss in preventing the smuggling of fentanyl across its border. However, Canada’s role in this supply chain is minimal. The majority of fentanyl entering the U.S. originates from clandestine production facilities abroad. Precursor chemicals are largely manufactured in China and then shipped to clandestine labs in Mexico, where they are made into opioids before being smuggled into the U.S. In fact, last fiscal year, the US seized 43 pounds of fentanyl at the Canadian border, contrasting sharply with 21,100 pounds at the Mexican border. So, why is Canada being punished?

The tariffs are likely to trigger a cascade of economic disruptions. U.S. consumers will face higher prices on everyday products ranging from automobiles to groceries. U.S. refineries – many of which are optimized for heavy, sour crude supplied predominantly by Canada – could see their input costs rise, pushing gasoline prices higher. Industries that rely on cross-border supply chains, such as automotive manufacturing (where components often cross the border multiple times, may face delays and increased costs.

Over the long term, the tariffs could compel U.S. companies to reconfigure their supply chains by shifting production away from North America to alternative markets. Certainly, the one could say that the U.S. has boosted domestic production in many sectors – most notably in oil and gas through the shale revolution. However, U.S. refineries are designed to process a diverse mix of crude oils, including heavy, sour grades that are more economically sourced from Canada. What’s more, although alternative markets might seem to offer greater “self-sufficiency,” the reality is that North American supply chains have evolved to deliver significant efficiency gains. Disentangling from these networks would require enormous capital investments, retooling of infrastructure, and could ultimately raise production costs for American consumers.

Ultimately, Trump’s tariffs – and the sweeping rhetoric accompanying them – raise a critical question: What does Trump truly want? Is his aim genuinely to address issues of drug trafficking and immigration, or is it a bid to assert unilateral power over international economic policy at the expense of longstanding alliances? The evidence suggests that these measures are not proportionate responses to the cited challenges, but rather political tools that risk imposing significant costs on the U.S. economy – through higher consumer prices, disrupted supply chains, and retaliatory trade measures – while alienating its closest ally.

People may say that Trump’s conditions to alleviate the tariffs are simple asks, but the issue is these are disingenuous conditions with moving targets, functioning as a smokescreen. So, what does Trump truly want, and at what cost? Because American consumers and businesses will be hurt too, and it will undermine the integrated trade relationships that have been a cornerstone of North American prosperity for decades. Luckily, Canadians will have a unified government looking to defend their interests.