Broadsheet

You’ve probably seen that Canadian PM Mark Carney has walked away from trade talks with the US. That has led the US to impose staggeringly large (and certainly illegal) tariffs on Canada and Canada is responding in kind. It’s not clear precisely what demands the US made that prompted Carney to do this. Given the pain this will cause Canada, at least in the near-term far more than the US, they must have been not only unacceptable but an affront to Canada’s sovereignty and national dignity.

As I understand it, negotiations appeared to be going well and productively. They began as an attempt to find an agreement to forestall Trump’s original threat of a new round of draconian and illegal tariffs. Indeed, they appeared to be so near completion that an article I saw mid-week referred to Mexico eyeing and looking to negotiate a deal with comparable contours. Point being, it was a measure not only of how well the negotiations appeared to be going but how close they seemed to completion. The broad outlines were known to other interested countries.

Then Carney abruptly ended them in response to new demands.

Canada is much smaller than the US, less than 1/10th the size in population and economy. The self-destruction the US is doing here is vast. But in the near term the pain for Canada is much greater. So what was this new demand? There’s simply no way this was triggered by wrangling over final details. Indeed, Carney’s public statements make this clear, despite his not sharing just what the demands were. I think it must have been demands things that genuinely compromised Canadian sovereignty. It can’t literally have been that Canada become a US state, since then any trade deal is moot. But I wonder how far from that it was. Carney referred to the demands as “unfair [and] uneconomic” and at another point said, “we were not prepared to compromise Canada’s sovereignty or undermine our key industries.”

We know from Trump’s business history that mafia-style squeezes are one of his trademarks. Specifically, he was known for introducing last minute demands that were so over-the-top and shocking that the counterparty would simply be bewildered and thrown off balance and start negotiating against themselves.

Back in early 2016 a TPM Reader who’d spent his career in the New York real estate and knew Trump and those like him described it like this …

There is a personality type with a New York developer, one Donald learned from Fred when he carried his dad’s briefcase to acquisition meetings out in the boroughs and it goes like this:

Donald contracts for a service or good, or the acquisition of a piece of land for $1 million.

He then does not pay you

You ask Donald for your million dollars

Donald yells at you, basely, abusively, wholly out of character to the rich gentleman you broke bread with and made the deal with. He tells you that no, YOU owe him $200,000. Gives you no reason but screams how can you be such a son of a bitch to rip him off, how he’s going to sue you, expose you as a cheat, etc.

You’re off your pins, defensive. How could this be the guy who was so nice when he picked up the check at Per Se?

So, you compromise, because human nature avoids conflict, right? This is what he’s gaming you for because once you compromised, you’ve lost. You’ve inferred his premise that you have some complicity in the matter otherwise why would you compromise? You are on the defensive and will never get it back.

You offer $750,000 as a settlement, angry buy want it over and done with. He then sues you. Why, because you’ve already committed yourself to the loss. You volunteered to surrender your position and what will stop you from keeping going?

I’ve seen many a New Yorker settle things like this with Trump people for 5-10 cents on the dollar and then happy, even eager to keep doing business with them. Why? Because he got in their heads with this aggressively counterintuitive behavior.

This isn’t the same as a end of negotiation ambush, as seems to have happened here. But it’s very much the same energy.

My best guess is that something like that happened at the end of last week. Because what Trump wants – particularly in the psychic space he’s been in since last fall – isn’t any particular trade deal but a burst of domination over and humiliation of the guy on the other side of the table. As we’ve discussed in other contexts in recent months, Trump is now especially craving these bursts of dominating adrenaline, which act as a kind of executive self-soothing, because of the pressure he feels over diminished power on so many other fronts.

Late Update: Carney now says that “in the last hours” the US introduced demands to restrict Canada’s ability to make trade deals with other countries.

Late Update II: Trump also apparently insisted on the inclusion of terms which would allow Trump to unilaterally impose 50% tariffs if Trump decided, unilaterally, that Canada wasn’t being nice. Obviously “being nice” wasn’t the language. But it grants the US side too much to indulge whatever the language might have since the point was at Trump’s discretion. In a way, he seemed to be insisting on the same total power which Trump claims to find in US law – and which kind of exists there but mostly doesn’t. In a way, this only formalizes Trump’s actions. He renegotiated NAFTA in his first term and then threw that out. But it certainly takes things to another level signing an agreement in which Canada binds itself to a specific trade regime and Trump (or in theory a future president) can still impose new tariffs if they feel like it.

A few more thoughts on the collapse of US-Canadian trade negotiations and the over-the-top US predation that led to it. (See my earlier post here.) Here’s a portion of an analysis piece from the Toronto Star …

Doing a deal under the conditions Carney described would clearly have undermined Canada’s pivot to new markets by putting Carney firmly under the thumb of the U.S.

As the prime minister described it, he was faced with a trade agreement that was suddenly transformed into an attack on Canadian sovereignty, an attempted psychological annexation that could have turned Canada into an American client state, a sort of North American Belarus.

It does, however, jive with Trump’s repeated 51st state taunts when he returned to the White House.

And Trump’s National Security Strategy said of America’s neighbours in the Western Hemisphere: “We want other nations to see us as their partner of first choice, and we will (through various means) discourage their collaboration with others.”

As Donald Trump not so much dismantles the US-backed global order as dynamites it, that destruction coupled with the rise of a more vocal and electorally prominent US left has renewed the discussion of just what that US-backed global order was. This passage and this whole US-Canada breakdown illustrates a lot of it.

The US has been a great power by various definitions for more than a century. It was one of two for most of the latter half of the 20th century and the sole one starting in the final decade of the 20th century.

To understand this now-receding era we must recognize the US power functioned differently with the relatively wealthy states primarily in the global north and those poorer states mainly in the south. Its power was based largely on two key alliance structures: One based in Europe (NATO) which is really the western fringe of Eurasia and another based on the littoral and island fringe of East Asia – Japan, South Korea, Taiwan, et al. It was a book I read by Zbigniew Brzezinski about twenty years ago that really shaped my understanding of how these two alliance structures fit together with global geography. The US completely dominates North America by its economic, military and even geographical heft and faces no real strategic competitors in South America. So we’re free of any real foes in our whole hemisphere.

Meanwhile, these two alliance structures create counterweights to Eurasia’s two great land powers, Russia and China. One of the reasons this has been a sustainable arrangement is that it worked for both sides. The US gets things it wants. For Western Europe and littoral East Asia it provides a counterweight to the local potential dominator/bully. But, critically, that counterweight comes from a partner which isn’t too close at hand. The US is big and powerful. But they are and will always be across the sea, over the horizon.

This schema of course leaves out a huge amount of the globe. But it was a stable and mutually beneficial system and at least until quite recently covered most of the globe’s wealth, as well as real and potential military power. (It’s also no accident that most of the US’s problems, wars and blunders over the last two generations have been in another place that doesn’t fit into this schema geographically, culturally or really any other way: the Greater Middle East.) And the key to its stability is that in those two alliance structures the US didn’t ask that much. No, the US isn’t a global philanthropist bringing peace and prosperity to all. But its terms are fairly generous. In these two theaters the US has acted not as a dominator but more like a first among equals.

Critics of US power have always stumbled on this basic fact. For all the purported similarities between the US and Russian great power models, why are countries in Europe trying to stay in or enter into our imperium rather break free of it? Ukraine illustrates all of this. It’s why Russia’s Eurasian Economic Union and its security counterpart, the Collective Security Treaty Organization, have been basically a bust while the EU and NATO have grown. Yes, yes, yes, the CIA and Victoria Nuland are the secret hands and all the rest. The reality is that the proof of the pudding has been in the eating.

The basic answer on all these fronts is that the US imperium, for those who wish to call it that, is, in these two theaters, a good deal. It doesn’t ask that much. The US has operated as a first among equals, not a mob boss. The centerpiece of Trumpism is that it wants to be a dominator, especially in the regions where that’s plausible, the Americas. (It’s no accident that the Star says the Trump wants to make Canada into an American Belarus, a nominally sovereign client state.) And in the short term the US has a lot of power to do that, or at least extract big costs from countries which don’t comply. But the US was never powerful enough and certainly isn’t powerful enough now to be the dominator of Europe and littoral East Asia, and certainly not the entire globe – not without infinitely larger spending on military power. We’re already seeing the de facto limits of US military might with an adversary as comparatively feeble as Iran.

The simple fact is that for all the other evils of Trumpism they simply don’t understand the basis of American power, military or economic. That’s the basis of the absurdity of the last decade in which the US is somehow the defiant rebel against the system it created for its own prosperity and security and which has secured both for going on a century. Listen to their thinking and you see it clearly: We’re the big power. We’re in charge. But we don’t act like we’re in charge. We let ourselves get pushed around. Now we’re going to be in charge. They simply don’t understand that to the extent we are “in charge” the underlying basis of the agreement that puts us in charge. It’s the comparatively easy terms of American global power. They really do imagine that US allies are something like colonies or finlandized client states that we’ve just let get over their skis.

The truth is that this precedes Trumpism. We saw this in that pivotal eighteen months or so between the 9/11 terrorist attacks in 2001 and the invasion of Iraq in early 2003. (I actually wrote a review essay about this conversation and the books it spawned in a review essay in The New Yorker at the end of 2003.) It was less impetuous and feral. But the outlines are the same: We’re in charge. But we haven’t been acting like we’re in charge. And it’s that lackadaisical approach to managing the globe that made things like 9/11 possible. So now we’re going to actually be in charge. Again, a basic misunderstanding of the basis on which we are ‘in charge’.

In truth, though I’ve been a partisan in these debates for half my life, a lot of this was probably inevitable with the end of the Cold War and the collapse of the major counterweight to American power, which shaped the ‘good’ decisions America made to put this whole system in place. A different and more fecund line of argument is whether the deal America made with its major allies drove unequal shifts in America’s domestic economy which ended up undermining the American domestic political foundations of these global alliances. That’s a complicated question. But there’s at least a there there.

I’ve talked a lot here about big think and the nature and limits of American power. I should conclude with what I hope goes without saying but still needs to be said. This breakdown in US-Canada relations isn’t just a misapprehension of the nature of American power. It’s deeply wrong, an unprovoked assault on friendly neighbors and longstanding partners with whom we share so much. As I wrote to a Canadian, discussing this this morning, this whole episode is a source of shame and embarrassment for the United States.