Recap: Carney calls negotiations with White House ‘complex’; Doug Ford inks agreement with Alberta and Saskatchewan

Part I is trade negotiator in chief.

Part II is manager at large of the country’s great expectations.

Unsurprisingly, Carney is struggling with Part I. Bargaining began with the prime minister declaring Canada’s grandiose goals, yet mind control is not as easy as it looks when trying to bend Donald Trump to his will.

Negotiations are not going according to plan.

Which is why Part II is also part of the plan. With talks in the home-stretch, Canada’s stretch goals look increasingly far-fetched as the goalposts keep moving.

Hence the prime ministerial imperative to lower expectations at home, starting with the 13 premiers closeted with him at a posh lakeside resort Tuesday. New tariffs are inevitable as Canada and the world adjust to the unavoidable reality of Trump’s world view, Carney explained.

The premiers get it, having heard it from the prime minister’s mouth. Now they are spreading the word.

In an unprecedented display of unity and solidarity, the first ministers are all singing from the same spreadsheet. They can see the terms of trade but also the trade-offs, the risks as well as the rewards.

Full credit to Trump for getting them all onside — on Carney’s side — as Canada braces for the worst.

Led by Doug Ford, the premiers heaped praise on the prime ministerial skill set. With Quebec’s oft-cantankerous François Legault beside him nodding in agreement, Ontario’s premier catalogued Carney’s achievements while praising his listening ability and humility.

“He’s an honest man, he just wants the best for Canada,” Ford enthused. “He is humble, he listens, he’s a smart businessman.”

Premier after premier echoed Ford’s words, declaring their fidelity to the federal negotiating strategy and the prime ministerial tactics.

“I have tremendous confidence in the prime minister and his team,” exulted Nova Scotia’s Tim Huston. “We’re all binding together and spending time together.”

Indeed, they have bonded beyond expectations. Monday night, after a barbecue hosted by Ford at his nearby cottage, Carney stayed over for the night — and talked long into the night, well after the other first ministers had returned to their rooms at the Deerhurst Resort.

The upshot is that this is Canada’s best shot to clean up its own house, that we may now be masters in their own house — maître chez nous, as Carney so often says in French to Quebec audiences, borrowing from a stock nationalist phrase connoting self-reliance. And so after receiving a vote of confidence from the premiers, Carney proceeded to praise their own willingness to dismantle domestic trade barriers as a way of reducing dependence on American markets.

“We are masters in our own home, and we can control our own economic destiny,” Carney told a news conference before flying back to Ottawa, leaving the premiers to sit down for their annual summit.

“Now we are starting to look at projects of national interest, and that will include a process with the Indigenous Peoples … when it comes to creating a single Canadian economy instead of 13.”

But a single Canadian economy will still be comprised of its parts — 10 provincial and three territorial — in which every politician is destined to remain territorial about where the benefits flow. Projects of national importance will be given priority, but how to define the national interest?

That’s a question that Carney, as prime minister of the entire country, will have to resolve as rival premiers put forward pet projects.

Ford put his best foot forward Tuesday, arguing that Ontario produces steel and other products that would be a good fit for the national economy. But he stressed that the criteria for worthy national projects should be truly national benefits.

Standing by Ford’s side, Quebec’s Legault was uncharacteristically circumspect at the microphone, saying that question was best put to the prime minister.

His silence was strictly diplomatic, in deference to the warm words uttered by Ford about the history of the Quebec-Ontario relationship and their own strong personal friendship. A more candid Legault might have retreated to his recurring demand that federal decisions redound to his province’s benefit and defer to Quebec’s jurisdictional aspirations.

That Legault held his tongue, mindful of his Ontario host, was perhaps a sign of the times and a signpost for Canada’s future direction in a time of American animus. The prime minister, for his part, made the most of the Canadian amity on display in Muskoka.

Asked whether the competition for federal funding “could divide the country,” Carney offered a contrarian view.

“It’s the contrary. For the projects to be of interest, to be of national interest, (they) have to benefit multiple stakeholders, multiple provinces, Indigenous people, also move us towards our climate objectives.”

As the U.S. closes in on Canada, can Carney square the circle?

Part I — renegotiating a trade entente — is the hard part.

Part II — managing expectations (and exhorting collaboration) — is well underway.

“We will agree (on) a deal if there’s one on the table that is in the best interests of Canadians, just as the United States will look for the best interests of the U.S.”

Given Trump’s unpredictability — a factor many premiers, including Doug Ford, repeatedly mention — Carney said other nations are eager to boost their business with Canada. 

“Our phone is ringing off the hook from other countries who want to do more. I’ve had over 80 bilaterals (meetings) with foreign leaders since I became prime minister,” he told reporters.

“A number of premiers have been on major trade missions … We’re going to focus more and more of our time on those positive aspects.”

Ford, who chairs the council of premiers, was tight-lipped when asked for details from Carney’s presentation behind closed doors. It followed a long chat the two had Monday night in front of the fireplace at Ford’s cottage near Huntsville, where the prime minister slept following a dinner of grilled steak and chicken with the premiers.

“I don’t want to jeopardize the negotiations … but, again, if I can say this, Donald Trump is very, very hard to deal with just because he’s so fluid,” Ford said. “It’s constantly moving with him.”

New Brunswick’s Susan Holt said the premiers encouraged Carney “not to make a deal at all costs” and to strategically use “exposure points” the provinces have flagged for Canadian negotiators to improve their prospects — such as the fact her province supplies much of the jet fuel used by the American military on the eastern seaboard.

“We’re seeing the U.S. react to some of Canada’s decisions. They’ve reacted very sensitively to the fact that Canadians aren’t travelling in their country right now,” Holt said, pointing to recent complaints from U.S. Ambassador to Canada Pete Hoekstra that this is a reason Trump feels Canada is “nasty.” 

“They’re reacting to the fact that we don’t have their booze on their shelves, and they’re irritated,” she added. “We need that irritation to get bigger and louder.”

Carney is also turning the federal government’s attention to infrastructure projects of national interest, with an office to evaluate proposals from the provinces to be set up in September. Ideas that benefit entire regions or the whole country will take precedence. 

“We will be focusing on initiatives that are within our own control for the benefit of Canadians,” the prime minister said, citing as one example a proposal for more “linkages” of British Columbia’s electricity grid with the Yukon and Northwest Territories to open up mining of critical minerals, which can also benefit Alberta. 

Competition is fierce, said Nova Scotia Premier Tim Houston, who is pushing a massive offshore wind energy project.

“There’s lots of potential projects and good, good ones,” he added. “Everyone is waiting for the major projects office to open.”

While Ford is advocating “dollar for dollar, tariff for tariff” retaliation if Trump imposes more levies, Carney suggested he’s taking a wait-and-see approach while Alberta Premier Danielle Smith and Saskatchewan’s Scott Moe have advised against such reprisals. 

“Everything’s on the table,” Ford maintained, including a return of the tax he briefly placed on electricity exports to Michigan, New York and Minnesota months ago — which had quickly caught the attention of Trump and U.S. Commerce Secretary Howard Lutnick. 

“You don’t want to trigger a complete (trade) war. But the only thing, I believe, with President Trump and Secretary Lutnick that I’ve seen, you have to be tough. If you’re weak, they will run us over.”

“We’ll see how this deal goes,” Ford added, referring to the trade negotiations. 

The premiers’ meeting with Carney included a briefing from two former Canadian ambassadors to the U.S., David McNaughton and Gary Doer, over a working lunch. 

Earlier in the day, Ford welcomed Moe into a memorandum of understanding with Ontario and Alberta to build new pipelines, rail lines and other energy infrastructure to move oil and critical minerals east and west.

Ford said such projects will be essential if the trade dispute with Trump interferes with the existing Line 5 pipeline that brings oil from the west to Ontario through Michigan, but Green Leader Mike Schreiner took issue with that. 

“Instead of using this time with the premiers to discuss real solutions to an escalating trade-war and affordability crisis, he is wasting time peddling projects that will only waste taxpayer dollars and accelerate climate change,” Schreiner said.

Any agreement that preserves Trump’s illegal tariffs would lock Canada into a subservient role for many years to come. And there’s no assurance that Trump would even live up to his end (given his regular violations of more comprehensive binding deals, like the Canada-U.S.-Mexico Agreement).

Perhaps there’s no immediate way to stop Trump from continuing down this path. Canada’s previous concessions (on border security, defence spending, and rescinding the Digital Services Tax) made no difference.

Of course, lower higher tariffs are better than higher tariffs, and the federal government may try to convince Canadians to accept an imperfect deal on this basis. It’s possible the average tariff on Canadian products under an Aug. 1 deal would be incrementally lower than those being paid by other countries — including those that have already reached “deals,” like China (47 per cent), Indonesia (19 per cent), or the U.K. (10 per cent).

This glass-half-full logic is dangerous, however. It’s not just the average tariff rate that determines how much damage will result from Trump’s attacks. The size and composition of trade also matters.

After all, the very structure of our economy has been shaped by a generation of tariff-free trade within North America. As a result, Canada is more dependent on exports to the U.S. than almost any other economy. Our U.S.-bound exports equal more than 25 per cent of total GDP. That means even a seemingly lower effective tariff rate will cause far more damage to Canada than faced by almost any other country. (Only Mexico is in the same boat.)

By my estimates, U.S. tariffs under a Trump “deal” would be equivalent to two to three per cent of Canadian GDP — several times more than other major trading partners (including China and the EU). Their economies are much less exposed to disruptions in exports to the U.S. For them, even a higher tariff rate won’t cause remotely the same damage.

So trying to portray a deal with continued tariffs as some kind of “victory” for Canada, because the stated tariff may seem lower than other countries, is dangerously wishful. On top of that, accepting a bad deal has other consequences.

It would unilaterally disarm Canada’s ability to respond to U.S. actions with counter-tariffs or nontariff measures. It would cement U.S. tariffs as a “new normal” — and thus unleash a flood of capital away from Canada, as firms give up hope that Trump’s tariffs are just a temporary bargaining ploy. It would sabotage nascent efforts with other countries to build a co-ordinated global response to Trump, by surrendering before a united front can take shape.

It would also squander the potential of growing political, economic, and financial turmoil in America to finally stay Trump’s hand. This is the most vulnerable moment of his presidency. He faces protests over health-care cuts, immigration raids, and Jeffrey Epstein. Giving him a big trade win now would buttress his authority at home — but for Canada would constitute an own goal of historic proportions.

We all wish Trump’s trade war could be defused through friendly negotiation. It’s not going to happen. But even if tariffs are inevitable in the short run, our ability to resist and survive them in the long run is undermined if we codify those attacks in the form of a lopsided, damaging “deal.”

A bad deal with Trump is worse than no deal. Canadians know that standing up to our suddenly-hostile neighbour is daunting. But voters affirmed their readiness for that challenge just months ago. The federal government needs to take confidence from Canadians’ capacity to fight for a sovereign economy — and ratify that courage by rejecting Trump’s ultimatums and continuing to strive for something better.

“We do have to have tough discussions with each other,” she added, criticizing Ford’s Bill 5 and the similar federal Bill C-5, which passed quickly in recent weeks, for measures that “bulldoze” treaty rights and other protections. 

“We’re all trying to make a better country. Rushing bills through is not a good way to start.”

Ford, this year’s chair of the council, pledged to pitch such a meeting to Carney over a barbecue dinner with premiers Monday night at his lakefront cottage south of Huntsville.

“We’ll really push it as quickly as possible to make that happen,” he said. 

British Columbia Premier David Eby said the request from Nepinak was “well received” by the premiers.

“Without question, Indigenous leadership need to be at the table with premiers and with the prime minister on issues,” he added. “We know if we want to get projects done quickly … the projects have to have strong Indigenous partnerships.”

The premiers’ meeting with the Assembly of First Nations, the Métis National Council, Congress of Aboriginal Peoples and others centred on the fight many Indigenous leaders are waging against Ford’s Protect Ontario by Unleashing Our Economy Act, and Carney’s One Canadian Economy Act, which also has a less contentious element — removing most federal barriers to interprovincial trade.

Both laws are aimed at speeding development of pipelines, rail corridors, mines and other major infrastructure projects — in Ottawa’s case, projects deemed of “national interest” and which the premiers and Carney are still discussing. 

Their passage left First Nations leaders furious at a lack of advance consultation. Ford and Carney have been attempting to smooth the resulting tensions ever since. 

Following their warnings that the controversial laws will end up slowing development, nine Ontario First Nations have launched legal challenges of both bills, insisting they are unconstitutional, and are seeking court injunctions to prevent Ottawa and Queen’s Park from moving quickly on projects. 

“Our rights cannot be implemented or respected without us, in substance and in process,” Nepinak warned last week. 

While still carrying a big stick in terms of his legislation, Ford said he’ll work with First Nations that are in agreement on projects and keep talking to others that are not.

“The ones that want to be progressive, more quick, we’ll move quick. The ones that want a little more conversation, that’s fine,” Ford told reporters.

“For the most part, I can’t do something if they don’t want to do it,” he added. “You can’t move forward without their collaboration and buy-in.”

That is hardly a guarantee, noted Chief Alvin Fiddler of Nishnawbe Aski Nation.

“That’s not what the bills say,” said Fiddler, who sat in on the meeting and in May pledged “fierce resistance” from native communities that are worried about being trampled in the rush to development. 

“We don’t believe you,” he added in a shot at Ford. 

Earlier in the day, Ford urged First Nations leaders to take advantage of billions of dollars in financial supports.

“This door is only open so long,” Ford said as he and his fellow premiers arrived at Deerhurst in a motorcade from Toronto, escorted by an Ontario Provincial Police motorcycle unit.

“There’s never been a better opportunity for Indigenous communities — I’ll speak for Ontario — than right now,” added Ford. “There’s $3 billion of equity sitting in the window that they can draw from. There’s $70 million of training, $10 million of scholarships.”

Ford is eager to accelerate projects in northwestern Ontario’s Ring of Fire to extract critical minerals needed for electric vehicles, defence and other industries.

“We’re gonna work with them,” he pledged in regard to First Nations. “We want everyone to have an opportunity.”

Carney, who met with hundreds of Indigenous representatives last Thursday in Gatineau over their concerns about the federal legislation, will provide premiers with an update Tuesday on trade negotiations with the Americans. 

Alberta Premier Danielle Smith said she’s eager to hear more details from Carney on Bill C-5 and echoed Ford’s concerns that major projects need to get rolling sooner rather than later.

“The problem has been, historically, that they haven’t moved at all, that projects have 10 year or more time horizons,” she told reporters.

“This new world we’re in, we have to figure out a way to get to ‘yes’ faster. It doesn’t mean there isn’t a robust conversation that has to happen, but it has to happen in a time frame when a proponent is going to know that the answer is ‘yes’ and how we get there,” Smith added.

“I’m supportive of an abridged time frame but I think we also have to figure out how that’s going to work.”

“What’s changed since last year? You have a new (federal) leader, but you also have this new sense of urgency, where I think the public’s patience for government finger-pointing at each other has probably gone way down because the stakes have gone way up,” said Andrew Parkin, executive director of the Environics Institute, on the ever-escalating Canada-U.S. trade dispute.

On Tuesday, Prime Minister Mark Carney and the country’s premiers will convene in Huntsville following U.S. President Donald Trump’s threat to slap 35 per cent tariffs on Canadian imports by Aug. 1 if a trade agreement between the nations is not reached by then.

The survey found that Canadians’ feelings about intergovernmental relations improved in most parts of the country outside of the North, where opinions were already more positive than in other regions.

Compared to 2024 figures, Saskatchewan boasted the largest increase, where the proportion of those who felt satisfied by federal-provincial collaboration more than doubled.

In Alberta and Quebec, however, the number of Canadians who felt the federal Liberals and their provincial governments did not work well together still outweighed those who felt the opposite.

The survey was conducted between May 1 and June 16 with 5,391 Canadians, with 90 per cent of responses collected online and the remainder by telephone. Because the majority of the survey was conducted online, the Environics Institute did not calculate a margin of error because online polls, despite being representative, cannot be considered truly random.

For the first time in the annual survey’s seven-year-history, the Environics Institute also asked respondents whether they trust the federal government or their provincial government more when it comes to handling international trade relations.

The report notes that 42 per cent of Canadians are more likely to trust the federal government on that file, which is triple the 14 per cent of those who trust their provincial government more.

Levels of trust were highest in Quebec at 46 per cent, and lowest in the Prairie provinces at 38 per cent.

Ottawa does not enjoy that same level of trust when it comes to other portfolios.

“After three consecutive years of increases, there has been a drop in the proportions trusting neither the federal nor their provincial government to deal with other key issues such as health care, climate change, immigration or the economy,” the report states.

The proportion of Canadians who did not trust either Ottawa or their provincial government to address climate change, for example, dropped by seven percentage points from last year.

“This change follows the removal of the federal consumer carbon tax after the change of prime minister earlier this year,” the report noted.

The survey also looked at supporters of provincial conservative parties in the prairies compared to those in Ontario, and found that of those who backed Alberta’s United Conservative Party, the Saskatchewan Party and Manitoba’s Progressive Conservatives, 68 per cent had a negative view of intergovernmental relations, while 27 per cent had a positive assessment.

Meanwhile, 40 per cent of supporters of Premier Doug Ford’s Progressive Conservatives had a negative view of those relations, with 56 per cent considering the relationship between provinces and the federal Liberals to be positive.

Ford, a key ally to Carney, opted not to aid Pierre Poilievre’s Conservatives, with whom he has a frosty relationship, in the recent federal election campaign.