Someone should tell Prime Minister Mark Carney that you can suffer a very nasty injury when you straddle both sides of a fence. That is what he appears to be doing with Canada's relationship with the United States.
On one side of the prickly pickets, we have his 'Elbows Up' bravado. It was a catchy slogan that appealed to voters at a time when we felt under assault by tariffs and threats to our sovereignty from the U.S. It was meaningless. We can do what we like with our elbows. We share the longest undefended border in the world with the world's most powerful nation. We have to get along.
Carney has been looking to Europe to replace billions of dollars in trade that flows between the two countries. According to a January 2025 paper by TD economists Marc Ercolao and Andrew Foran, $3.6 billion in total exports crossed the border every day at that time. Canada was number one in buying U.S. goods, with almost $350 billion (US) crossing the border to Canada in the first three quarters of 2024.
According to a 2025 Statistics Canada report, in 2024, 76% of Canada's merchandise exports were destined for the U.S. That number dropped below 70% in April and May 2025 as the trade conflict with the U.S. escalated but then rebounded to 73% by July. Meanwhile, non-U.S. exports declined. We have a long way to go if the prime minister plans to replace lost trade with the U.S. by cosying up to Europe.
Carney shifted to the other side of the fence with a speech to the Economic Club of New York on Thursday. Speaking to business leaders, he pointed to the integrated nature of the U.S.-Canada trade partnership and underlined the importance of Canada's natural resources to the U.S. 'Canada strong will help make America great again,' he said. Put that on a hat and he has his next election slogan. His words were welcomed by the U.S. ambassador to Canada, Pete Hoekstra, which is a nice change.
This about-face was entirely predictable and acknowledges the reality that we cannot pretend our neighbour to the south doesn't exist. It does. And we must do business with them.
