White House reportedly considering new economic penalties against Canada


Kudlow also pointedly denied a media report suggesting U.S. Treasury Secretary Steve Mnuchin tried to talk the president into extending an exemption for Canada from the steel tariffs, calling it "patently false". Canadian broadcaster CBC also confirmed that the conversation took place.

Canada, a British colony at the time, did not become a nation until 1867.

In its claim, Mexico accused the US of using national security as an excuse to impose 25 percent tariffs on steel and 10 percent tariffs on aluminum, saying the true motivation is economic.

Canada countered by announcing it would slap an estimated $16.6 billion in duties on some steel and aluminum products and other goods from the USA, including maple syrup, beer kegs, whisky and toilet paper. Trump reportedly responded by saying, "Didn't you guys burn down the White House?" during the May 25 call. Given that Trump doesn't even know the words to God Bless America, I think it's safe to say that this line was exactly as dumb and ill-informed as it sounds*.

Canadian Prime Minister Trudeau has his own ideas.

"Japan and the European Union will team up on this issue and call on cooperation from other countries", Japanese Trade Minister Hiroshige Seko told reporters Tuesday.

"The six other countries of the G7 represent a market which is bigger than the American market", the French president said.

The U.S. has been in trade negotiations with Mexico and Canada for months over the North American Free Trade Agreement.

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Mr Trudeau, the summit host, and British Prime Minister Theresa May, who will also attend, are among those to sharply criticise the United States tariffs as unjustified and punitive.

"It's understandable that change causes friction", the official said, noting some of Trump's recent tariff announcements have brought stubborn trading partners back to the negotiating table.

The G7 groups Canada, the United States, Japan, Britain, Italy, France and Germany.

Macron was even more emphatic, calling on the other G7 members to resist what he warned was a potential United States drift towards "further isolationism and "crude hegemony".

Trump has previously admitted to making a claim to Trudeau that he wasn't sure was true, insisting that the US had a trade deficit with Canada. The United States trade representative office told the Washington Post that the US actually has a trade surplus with Canada.

"You can't, among allies in this worldwide context, start a trade war".

"President Trump is very clear with respect to his trade reform efforts that we will do what is necessary to protect the United States, its businesses, and its workforce", he said.

Kudlow said allies should understand that Trump "will do what is necessary to protect the USA, its businesses and its workforce", adding that Trump "has always said, and I agree, tariffs are a tool in that effort".