In the opening rounds of the trade war with the United States, each time Donald Trump hit Canada with tariffs he was met with a counterpunch from Ottawa.
That strategy appears to be changing.
When the U.S. President doubled tariffs on steel and aluminum this week, Prime Minister Mark Carney chose not to respond in kind, despite urging from some business and labour groups and Ontario Premier Doug Ford. Meanwhile, a set of carve-outs, announced in April, have taken the edge off some of the levies Canada imposed on U.S. products earlier this year.
Canada’s more measured approach marks a new phase in the trade conflict, where negotiations between Mr. Carney and Mr. Trump have moved behind closed doors after months of public grandstanding.
It may also reflect the thinking of a former central banker, now in the prime minister’s chair. Economists largely agree that imposing tariffs frequently hurts your own businesses and consumers …