Trump assails Canadian tariffs, accuses people of smuggling U.S. goods home

U.S. President Donald Trump launched another trade tirade against Canadians, accusing them Tuesday of sneaking their American shopping back home — all because of what he calls "massive" tariffs on American goods.

'We can no longer be the stupid country; we want to be the smart country'

Canadians smuggle American goods back home to avoid 'massive' tariffs, according to U.S. President Donald Trump. (Evan Vucci/Associated Press)

U.S. President Donald Trump launched another trade tirade against Canadians, accusing them Tuesday of sneaking their American shopping back home — all because of what he calls "massive" tariffs on American goods.

Speaking to a gathering of small business owners in Washington, Trump again blasted the North American Free Trade Agreement, saying the U.S. can no longer afford to be the "stupid country."

Canada imposes such onerous tariffs on U.S. products — shoes, for instance — that people are forced to "scuff 'em up" in order to "smuggle" them home, the president said.

Trump said he's looking out for American farmers and manufacturers, as he again took issue with Canada's supply management system for dairy farmers.

"We can no longer be the stupid country; we want to be the smart country," he said to rousing applause.

More American goods will be subjected to Canadian tariffs in the coming weeks.

On July 1, Canada is set to impose retaliatory action of $16.6 billion on U.S. products after Trump slapped tariffs on aluminum and steel — and he has threatened more to come on automobiles.

Foreign Affairs Minister Chrystia Freeland told the Commons international trade committee that the "absurd and insulting" U.S. action will meet with a firm response.

She said the government has finished consulting with Canadians on its proposed list of American consumer goods — dozens of items from Kentucky bourbon, to candles, to felt-tipped pens — and will be making some tweaks on which ones will be slapped with new duties.

"We will be using that feedback to modify the list," she said. "We will not escalate, and we will not back down."

No emergency Commons debate

Freeland met last week with Trump's trade czar Robert Lighthizer and spoke to him Monday by phone. She also spoke with U.S. Secretary of State Mike Pompeo over the weekend. She said Canada, Mexico and the U.S. will continue negotiating NAFTA through the summer and that she is convinced there is "goodwill" moving forward.

Earlier Tuesday, the Official Opposition called for an emergency debate in the House of Commons over the future of the Canada-U.S. trade deal.

Conservative foreign affairs critic Erin O'Toole said Canadians need to see their elected representatives addressing what is the biggest economic crisis in their lifetime — but Commons Speaker Geoff Regan said the issue did not meet the requirements for an emergency debate.

The Trump administration has already imposed punishing tariffs on imports of steel and aluminum from Canada, Mexico and the European Union, using national security as a justification. And it has launched an investigation into whether tariffs should be slapped on cars and light trucks entering the U.S. using the same national security clause.

"Tariff imposition of this nature would be devastating for the auto industry in Ontario," O'Toole said. "There has never been such a looming threat to the Canadian economy than the threat we're looking at now."

Stocks down on trade war threat

The bid to save NAFTA comes as the fear of a global trade war continues to grow, fuelled by the Trump's administration's plan to impose new tariffs on China that target $200 billion worth of goods.

China said Tuesday it would respond with "comprehensive measures" that could target American companies, sending global markets into a nose dive.

North American stock markets fell in mid-day trading, with the S&P/TSX composite index falling 50.84 points to 16,332.79.

In New York, the Dow Jones industrial average was down 299.99 points to 24,687.48.

The Standard & Poor's 500 index was down 15.04 points to 2,758.71 and the Nasdaq composite index was down 45.60 points to 7,701.43.