Former Finance Minister Ralph Goodale on Trump’s Proposed Tariffs and the Future of CUSMA

Added: 2026-06-03

[00:00:06]The Trump administration is proposing a new 10% tariff targeting some Canadian goods. The move follows an investigation by the Office of the US Trade Representative, which claims Canada is among dozens of countries that have failed to adequately enforce a ban on imports made with forced labor. In a statement, US Trade Representative Jameson Greer said this failure by what he calls the US's most important trading partners means American workers are being forced to compete on an unlevel playing field. Canada is just one of 60 economies targeted by the proposed tariff. Some countries would face an even higher rate of 12.5%.

[00:00:42]But importantly, the new tariff would not apply to goods that comply with the Canada US Mexico Agreement on Trade or KUSMA. The announcement comes on the heels of a visit yesterday in Washington by Canada US Trade Minister Dominic Leblanc and chief negotiator Janice Cherrett where they met with Ambassador Greer. For more on what this move means as Kusma Tarks ramp up, I am joined by Ralph Goodale, now a member of Prime Minister Carney's advisory committee on Canada US economic relations. Mr. Goodell, thanks very much for making time for us. I appreciate it.

[00:01:11]>> It's a pleasure to be with you. So, Prime Minister Carney has said today that this announcement was not a surprise uh that Canada knew the US was studying this issue and that it could lead to more tariffs. Koozma compliant goods as I mentioned would be exempt.

[00:01:23]So, how would you describe the impact you think this move will have on Canadian businesses?

[00:01:30]Well, any whiff of tariff is not a good thing uh when it could potentially disadvantage Canadian businesses in in doing business in the American market.

[00:01:43]Uh but e ever since the uh the Supreme Court ruling in the United States a few months ago uh that struck down a number of the tariffs that were uh proposed by uh by President Trump uh on a certain legal basis and the court said that basis did not exist. Therefore those uh those tariffs need to come off. Uh we have known that they were looking for other ways uh to justify uh tariffs of this kind uh and uh obviously the uh the um uh issue of forced labor or slave labor around the world uh is is one that they have been examining. We knew that it was no surprise that they would that they would uh endeavor to support their their their trade position by uh by using this uh this argument. Uh as you point out from Canada's point of view u because uh we have kma and kosma compliant goods are exempt from uh from this provision or will be exempt from this provision. uh that that is clearly good news from from the Canadian uh point of view. It's it's interesting that the American argument is based on cost competitiveness and not on human rights issues. Um a great many people around the world might view this issue the other way around. Uh but in in any event this is an area if you remember like fentanol a year ago uh where uh we would share the concern both about human rights and about uh cost competitiveness uh with with the United States uh and it's an area where where we can certainly work together. We already have legislation in this field. Uh it's already mentioned in KUSMA. Uh we will be uh strengthening the legislation. Uh Mr. Carney indicated that uh uh just in the uh the last short while uh and as with uh fentanyl there may be a requirement to strengthen the resources and the capacity of CBSA, the Canada Border Services Agency uh to make sure that their monitoring, detection uh and enforcement uh provisions uh are are sufficiently strong. But this is this is not a case of of where we're on opposite sides in principle from the Americans.

[00:04:06]Obviously, Canada opposes forced labor.

[00:04:09]Uh and uh we are anxious to uh perform at a very high level uh in implementing our laws and implementing our our trade agreements uh consistent with that principled position. So, if I'm hearing you correctly, you're saying that this is, you know, there is a legitimate policy basis for this this decision, but there is also this imperative that the Trump administration is seeking to establish yet another legal basis to justify the tariffs. But let's stay with with the focus of those >> and and it would and it would affect many of their companies too. I think of uh major uh retailers who do imports around the world. uh some of the biggest retailers uh are based in the United States and they would be subject to the same issues that we would be in Canada.

[00:04:54]>> Right. And and let's stay with those forced labor concerns for a moment because the Carne government recently opened the door to 49,000 Chinese-made electric vehicles even though there are wellocumented concerns about forced labor in the production of for example Chinese aluminum, auto parts, electronics among many other products.

[00:05:10]How do you think that move complicates Canada's response to these concerns being put forward by the Americans right now?

[00:05:17]>> Uh it is uh it is obviously a very important issue.

[00:05:23]We will need to be meticulous uh in uh in demonstrating uh that this kind of import uh does not uh uh contravene the rules of our own law or the uh the provisions of our of our trade agreements. Uh that will be uh u a very important priority going forward making sure that we are consistent with our own law and with our trade agreements. M um you alluded to it earlier. Prime Minister Carney said today that his government is preparing legislation to strengthen Canada's response to these forced labor concerns uh in both Canadian imports and and supply chains. Do you have a sense there's anything Ottawa can really do here to convince the Trump administration that Canada is taking these concerns seriously given again that you you know you seem to suggest that much of this is finding you know cover for uh the Americans uh tariff policy.

[00:06:17]bringing forward legislation that uh strengthens the law that's already there uh will obviously be a step in the in the right direction that that can be uh pointed to by our trade negotiators as uh evidence that we are taking this issue seriously and always have uh taken it seriously. Um the uh the the other side of the equation is is detection and enforcement. Uh and as we did in relation to fentanyl, uh there may be some requirement to uh uh beef up the capacity of CBSA uh to uh to do the enforcement actions at the at the border that that would be required. Um similarly, um it's sort of a case of the the the the the pot calling the kettle black. uh it it may be uh uh uh useful on our part to point out that uh the Americans have some of those same enforcement issues.

[00:07:17]>> I wonder if we can just step back and look at the bigger picture because there's still a lot of noise surrounding the future of Kuzma, the state of Canada's talks with the Americans. Uh the Trump administration's concerns are well known whether it's limited access to Canada's dairy market, digital and streaming regulations, this new push towards uh to more by Canadian when it comes to procurement, or even the fact that US alcohol is now no longer stocked by many provincial liquid stores. So it it's hard to know what will what it will ultimately take to reach a deal. Uh there's a lot of talk about the need to reach a deal, less so about what concessions might be needed to get there. So in your view, what should Canadians be expecting? what should they be thinking about when it comes to, you know, what Canada might have to give up to ultimately uh reach an agreement?

[00:08:00]>> Well, even though this process seems like it's been going on forever, uh we are really at the beginning of the process and we need to uh follow that old British adage about uh keeping calm and carrying on. Uh we'll need nerves of steel uh and we'll need to hold our courage uh in the face of uh uh a lot of pressure and and a lot of uh chaos tactics that will try to divert our attention and get us running after bright shiny objects down rabbit holes.

[00:08:30]Uh but there are there are basically four parts to the to the the the government's approach to this thus far.

[00:08:37]one is building out the Canadian economy to make us bigger and stronger on our own two feet uh so that we can be more uh self-reliant and less vulnerable than we have been in the past. Uh the second part is diversifying our trade and security arrangements around the world so that we are less dependent on on one particular partner in the uh in the United States. Thirdly, uh we need to work always to keep Canadians united so that we are cohesive and working together and pulling in the same direction on on these issues and therefore fairness and balance across the country will be will be uh extremely important and then finally finding ways in which we can rebuild a functional relationship with the United States. the relationship that we have known for 80 years has clearly come to uh come to an end, not by anything we did, but because of them. Uh the the affection has clearly gone from the relationship. Uh and so is much of the trust, but they're still big. They still live right next door. Uh so they will continue to be extremely important. Uh and we need to find the ways to work with them uh toward common goals and and objectives.

[00:09:57]Uh and this latest issue uh it's it's it's probably on the trade agenda, not the biggest issue in the world. Uh but it's a serious one about uh about forced labor. Uh and it's an issue uh where where we may be able to find common ground and uh and and work with the Americans uh to uh jointly combat the uh the scourge of of forced labor uh and improve the quality of life everywhere.

[00:10:24]uh this this effort uh to to to find the ways to work together I think was in part what Mr. Carney was talking about last week uh uh in his speech to the economic club in uh in New York uh and pointing out Canadian strengths, our insistence on our own sovereignty and our independence uh and uh uh indicating that uh that a very strong, self-confident, always sovereign Canada uh can be a very important asset in North America.

[00:10:59]Quite a challenging set of circumstances as you lay it out. Maybe a rocky road ahead. We'll see how it all plays out.

[00:11:04]Ralph Goodell, now member of Prime Minister Carney's advisory committee on Canada US Economic Relations. Thanks again for being here. Appreciate it.

[00:11:11]>> Thank you.