President Donald Trump has responded to Ontario’s 25% surcharge on electricity exports to three US states.
Citing what he called unfair trade practices by Canada, Trump issued a lengthy statement on Truth Social explaining that he will be doubling tariffs on steel and aluminum from Canada – raising them from 25% to 50%.
“Based on Ontario, Canada, placing a 25% Tariff on ‘Electricity’ coming into the United States, I have instructed my Secretary of Commerce to add an ADDITIONAL 25% Tariff, to 50%, on all STEEL and ALUMINUM COMING INTO THE UNITED STATES FROM CANADA, ONE OF THE HIGHEST TARIFFING NATIONS ANYWHERE IN THE WORLD,” Trump wrote.
The POTUS has announced that the move will take effect on Wednesday.
Note: Tariffs are taxes imposed on goods imported from other countries. The companies that bring the goods into the country pay the tax to the government.
It is the latest escalation in an ongoing trade war that has rattled financial markets and strained relations between the two countries.
The president also announced: “I will shortly be declaring a National Emergency on Electricity within the threatened area. This will allow the U.S. to quickly do what has to be done to alleviate this abusive threat from Canada.”
Trump’s message did not stop at steel and aluminum. He also took aim at Canada’s agricultural policies, calling for immediate action.
“Canada must immediately drop their Anti-American Farmer Tariff of 250% to 390% on various U.S. dairy products, which has long been considered outrageous,” Trump wrote.
Raising the Stakes: Auto Tariffs on the Horizon
Trump’s threats continued, warning that “if other egregious, long-time Tariffs are not likewise dropped by Canada, I will substantially increase, on April 2nd, the Tariffs on Cars coming into the U.S., which will, essentially, permanently shut down the automobile manufacturing business in Canada.”
The president then suggested that Canada’s reliance on the U.S. military is another factor in what he considers an unfair economic relationship.
“Canada pays very little for National Security, relying on the United States for military protection,” Trump wrote. “We are subsidizing Canada to the tune of more than 200 Billion Dollars a year. WHY??? This cannot continue.”
Trump’s Once Again Shares “51st State” Proposal
Perhaps the most shocking portion of Trump’s statement was his continued suggestion that the solution to these trade disputes would be for Canada to join the United States.
“The only thing that makes sense is for Canada to become our cherished Fifty First State,” the POTUS wrote. “This would make all Tariffs, and everything else, totally disappear.
“Canadians’ taxes will be very substantially reduced, they will be more secure, militarily and otherwise, than ever before, there would no longer be a Northern Border problem, and the greatest and most powerful nation in the World will be bigger, better and stronger than ever — And Canada will be a big part of that.”
He further elaborated, proposing that merging the two nations would create an unparalleled global powerhouse:
“The artificial line of separation drawn many years ago will finally disappear, and we will have the safest and most beautiful Nation anywhere in the World — And your brilliant anthem, ‘O Canada,’ will continue to play, but now representing a GREAT and POWERFUL STATE within the greatest Nation that the World has ever seen!”
Market Jitters and Economic Fallout
Trump’s aggressive trade policies have already sent shockwaves through financial markets.
The S&P 500 fell 2.7% on Monday in what analysts are calling the “Trump slump,” wiping out the gains made since his re-election in November 2024, as reported by Fortune.com. The index dipped another 0.4% Tuesday morning following his latest tariff announcement.
Harvard economist Larry Summers warned that Trump’s unpredictable trade maneuvers are having a chilling effect on the economy. “All the emphasis on tariffs and all the ambiguity and uncertainty has both chilled demand and caused prices to go up,” he posted on X.
Goldman Sachs, in response to Trump’s tariff escalation, revised its U.S. growth forecast for the year down from 2.2% to 1.7% and raised the probability of a recession to 20%. The firm noted that the White House could still pull back on these measures if economic risks intensify.
Trump, however, insists his policies are necessary for long-term economic success. In a Fox News interview over the weekend, he defended the trade war, saying: “There is a period of transition, because what we’re doing is very big. We’re bringing wealth back to America. It takes a little time. But I think it should be great for us.”
The White House has pointed to potential economic wins, claiming that major automakers such as Honda, Volkswagen, and Volvo are now considering new U.S. factory investments. However, economists remain skeptical about whether the tariffs will produce net positive effects in the long run.
