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“The wise course for us is precisely the opposite — to move unilaterally toward free trade. If they still choose to impose restrictions, that is too bad but at least we have not added insult to injury.”

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Evidence for Friedman’s position is found in a recent New York Times article about the vulnerability of electricity grids, largely because of their dependence on expensive, hand-crafted power transformers that are difficult to replace. While U.S. companies are building manufacturing facilities and developing alternative transformer technologies, they’re hampered by tariffs on copper and aluminum. “Costs are up almost 20 percent,” an industry executive told the Times. “We need relief on all of the metals.”

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The next massive blackout may happen because trade barriers raised the cost of preventing it beyond the industry’s ability to afford resilience.

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Just because Trump is an economic ignoramus who thinks economic activity can be successfully managed by government, despite a long history of evidence to the contrary, doesn’t mean that Carney should follow his example and contribute to the conflict.

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Quebec-born Vincent Geloso, an economics professor at Virginia’s George Mason University, argues that “Canada’s response to American tariffs should be incredibly simple: slash our own tariffs and trade barriers. And do not impose counter-tariffs.”

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He makes the same argument offered by Friedman, that tariffs hurt consumers and businesses in the countries that impose them. “How exactly does making Canadians poorer punish Donald Trump? If the Trump admin wants to shoot itself in the foot, the Carney government is under no obligation to shoot Canadians in the face with a twelve gauge shotgun for the sake of ‘reciprocity.’”

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Or, as the late British economist Joan Robinson wrote, “The popular view that free trade is all very well so long as all nations are free-traders, but that when other nations erect tariffs we must erect tariffs too, is countered by the argument that it would be just as sensible to drop rocks into our harbours because other nations have rocky coasts.”

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In a 2025 paper, Geloso pointed out that Britain benefited from repealing “Corn Law” tariffs on imported grain. “The Corn Laws had the effect of keeping food prices in the UK 9% higher relative to world markets. Since food items were a major component of the budgets of the poor, the repeal of the tariffs was largely a ‘pro-poor’ policy.” He added that most 19th century trade liberalization was unilateral, with no expectation that other nations would necessarily reciprocate. Liberalizing nations quickly prospered.

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Yes, it’s better when all governments get out of the way and let people and businesses exercise their right to engage in voluntary exchange without regard to borders. But holding trade hostage to the intelligence, decency, and economic wisdom of political leaders in multiple countries is a sucker’s bet. Inevitably, populists with neo-mercantilist ideas arise and burden their own people with tariffs while claiming to help them.

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In the days to come, people will spend much time digging for and through the details of the failed U.S.-Canada trade talks. There will be much debate over what was fair and what was not.

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But that’s a waste of time. The only definition of “fair” that matters is what people voluntarily agree to in their own dealings. If, under current management, the U.S. won’t embrace free trade policies that make everybody wealthier, Canada should do so on its own. Canadians would be freer and more prosperous by avoiding the American mistake of burdening commerce with tariffs and conditions.

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National Post

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