The Trump-initiated trade war will have a major impact on all our lives. The US turn to protectionism means great instability and uncertainty in a wide range of countries but Canada is going to be impacted to a particularly severe degree.
At this early stage, the response in Canada has been dominated by a wave of nationalistic feeling and the desire to “stand up to a bully,” as Mark Carney has put it. Doubtless, this ‘Team Canada’ sentiment will lose a great deal of steam as ‘patriotic’ employers impose the burden of the trade war on workers and flag-waving governments double down on their austerity agenda.
Canada’s capitalists and their political representatives are developing strategies to respond to Trump’s measures that will run counter to working-class needs and these will lead to very sharp struggles in the period ahead. However, questions arise as to what a coherent and effective working-class strategy should consist of.
There is general agreement on the left that we should ensure that working-class interests are upheld in the period ahead and that there will be critical struggles to defend workers’ rights and win adequate social protections in the face of economic hardship and dislocation. There is, however, some disagreement as to remedies that might be proposed when it comes to the trading relationship between the US and Canada that underlies the present crisis.
Canadian nationalism
There are two fundamentally different approaches to the present trade war. We can develop an independent and internationalist working-class strategy to fight back or embrace a perspective based on a supposed Canadian ‘national interest.’ In the first case, the irreconcilably opposed interests of working-class people and those who exploit them are stressed and acted upon. In the second, the emphasis is placed on strategies to protect Canadian society as a whole from Trump’s protectionism.
It would be a profound mistake to try and obliterate, or even blur, the class lines along which the trade crisis will play out. Canadian capitalists, faced with Trump’s attack, will work to preserve their profits at the expense of workers and the degree to which the trade war will become a class war shouldn’t be underestimated. We are not all in this together and we should firmly reject nationalism as a way forward.
There are, however, those on the left who, though they support working-class resistance in this situation, feel that there are distinct Canadian interests that must be upheld. They seek to remedy the level of dependence on trade with the US with an approach that is often referred to as ‘delinking’ in order to generate a greater level of economic independence.
Socialist Project has expressed this perspective very clearly and forthrightly. It argues that “(t)he struggles of Canadian working people – in English Canada, Quebec, and First Nations – to challenge austerity and fight for a socially just and environmentally responsible society requires the power to make political and economic decisions, which is now limited by the integration and dependence of Canadian capital on the US empire…We have to fight to ‘delink’ from the US, in the sense of building the international and political autonomy needed to take alternate development and democratic decisions, all the while building working-class identity, understanding, and power to organize and fight.”
We must, of course, reject notions of Canada as an oppressed colony of the US. As Todd Gordon has pointed out, “while Canada is nowhere near as powerful as the US, it is nevertheless one of the largest economies in the world, with the ninth-largest GDP in 2023, and with the fourth-largest outward foreign direct investment stock.” Moreover, “foreign ownership in general accounts for less than 15% of all business assets in Canada.”
Having said this, David Bush is quite correct to note that “(t)he Canadian and the US economies are amongst the most integrated in the world. The Canadian ruling class has pursued the strategy of integration since the 1930s. The proximity to the largest economy in the world made this an obvious choice for Canada’s capitalist class.”
A Scotiabank fact sheet shows that, in 2023, trade with the US “accounted for 77% of total Canadian goods exports and 63% of Canadian goods imports… Exports to the US were responsible for roughly 19% of Canadian GDP in 2023.” Under such conditions, the US turn to virulent protectionism constitutes a very major challenge for Canadian capitalism and its political agents.
Flawed strategy
With such a high level of trade taking place with the US, the question arises of whether socialists should advance a strategy of delinking from the dominant economic power and press this demand as part of the struggles that are taken up in response to the trade crisis. There are, in my view, a series of pitfalls with such an approach that need to be considered.
First of all, there is no doubt that Canadian governments will themselves respond to the Trump tariffs with a vigorous effort to diversify trade and to seek out new trading partners. Mark Carney has stated that “(t)he old relationship we had with the United States based on deepening integration of our economies and tight security and military cooperation is over.”
The Liberals have already established “a new Trade Diversification Corridor Fund, to build the infrastructure that will help diversify our trade partners, create good jobs and drive economic growth.’ A significant part of this initiative will be devoted to removing ‘interprovincial trade barriers,’ which is to say that every effort will be made to reduce provincial regulations protecting workers, consumers and the environment. We may be sure that this is only the beginning.
As I have already suggested, the strategies that will be adopted in this period will be driven by the need to preserve profitability. To the extent that Canada joins the international scramble to find new trading partners, it will be a highly competitive undertaking. Canadian businesses will only prevail by beating out their rivals and this will mean intensified exploitation of workers and the gutting of social expenditures. Trade diversification will be undertaken in the interests of capitalists and at the expense of workers and communities.
Left advocates of delinking will assert that they have something very different in mind. They will press for workers’ rights and robust social provision to be part of the process and will argue for capitalist profit-making to be subordinated to a form of state control that increasingly reflects working-class interests. They will insist that delinking is to be pursued as part of a struggle for a socialist agenda.
The immediate problem with this approach is that the present balance of forces means that a left notion of delinking can only be advanced as an oppositional position, even as a model of trade diversification that is to the liking of the capitalist class is put into effect. However, in my opinion, there are problems with delinking that would apply even if we were in a position to advance it as a political project.
At root, the idea being advanced is to free Canada from the restrictions imposed on it by the relationship with the US and to do so in order to democratize the economy and move towards socialist objectives. This seems to be the pursuit of ‘socialism in one country’ under the most unfavourable circumstances imaginable. Canada is required to break free and pursue social transformation in the shadow of the Empire.
An advance towards socialism can only happen as part of an international struggle and not as a fragile project unfolding next door to an intact imperialist hegemon. Of course, there is a distinct struggle to be taken up within the confines of the Canadian state but its outcome hinges on the class struggle in the US. If there is one massive social force we don’t want to delink from, it’s the American working-class. The fight for a socialist future in Canada hinges on the defeat of US imperialism and the pursuit of working-class power on a North American basis.
The immediate struggle that faces the Canadian working-class is nonetheless with its own ruling class. In the interests of profitability and international competitiveness, an attempt is already underway to impose the burden of the trade crisis on workers and communities. The fight against large-scale unemployment, employers’ demands for concessions, the rationalization of workforces, the gutting of social protections, environmental degradation and intensified austerity is before us. Bold demands around workers’ rights and the strengthening of the social infrastructure are needed and such struggles must be taken up forcefully and without delay if major defeats are to be prevented.
In my view, however, the notion of an incrementally democratized Canadian state, moving towards socialism as a convulsing US imperialism goes from Trump to worse, simply isn’t viable. The issue isn’t to delink from ‘the Empire’ but to contribute to the vital task of bringing it down.
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