By Kevin Carmichael
Scary thought, isn’t it? We have our strengths, but we’ve long had the fantastic luck of playing wing on a line centred by the global economy’s dominant player—the French and British empires at the start of our colonial history, and then the U.S. as European power receded.
That was never a wise strategy. As The Logic has been showing in its ongoing Resilient Canada series, if you rely on someone else to do the heavy lifting, your own ability to perform at a high level begins to atrophy. That’s Canada in a world without America on its side.
U.S. Treasury Secretary Scott Bessent said this week that “America first” doesn’t mean “America alone.” What it really means is a “call for deeper collaboration and mutual respect among trade partners,” Bessent said in a speech ahead of the semi-annual meetings of the International Monetary Fund and World Bank in Washington, D.C.
Somewhat soothing. A day later, Trump reiterated his desire to make Canada the 51st state. A country such as South Korea might be able to contemplate deeper collaboration with Trump’s America. Canada can’t. There’s no respect.
We’re not entirely alone. The French president, the British prime minister and the King made time for Mark Carney when he dashed to Europe after winning the Liberal leadership. The outgoing chancellor of Germany said “we stand by your side” against America’s verbal abuse and trolling. The Canadian dollar has appreciated this month, suggesting some investors see Canada as a haven from Trump’s chaos.
But our friends in Europe also reneged on their plan to join us in tit-for-tat tariffs over Trump’s arbitrary duties on steel and aluminum imports. The only country left by our side on that particular front of Trump’s economic war is China, which Carney has singled out as the biggest threat to Canada’s security.
Japan was one of the first in line to do a bilateral deal with Trump, a blow to whatever hopes might exist of forming an alliance large enough to show the Trump administration what it feels like to be arbitrarily “tariffed.” Mexico has mostly operated apart.
So—mostly alone. It’s something to keep in mind amid prideful shouts such as “Canada strong” and boastful cries such as “Canada first.” The thing is, Canada has long put itself first—by free riding on the back of the world’s largest economy, refusing to meet its NATO commitments and dining out on its membership in the G7, an elite club in which we probably don’t belong. The rest of the world noticed.
Being alone needn’t be a negative. Australia is alone. Singapore is alone. Ireland is alone. Those countries are admired. They have used their wits to fight through tough circumstances and create resilient economies. They are defined by what they do, not who they know.
Canada will continue to trade with the U.S. no matter what happens. A betting person might put money on us muddling along somewhat like we are now. But that scenario leaves us poorer over time. We might survive Trump’s presidency, but one day find ourselves too enfeebled to stand on our own. That’s how Newfoundland and Labrador ended up joining confederation, as the province’s outgoing premier, Andrew Furey, has observed by way of warning to those of us who have less experience with what that feels like.
Societies have a tendency to make grim circumstances worse. Evan Fraser, a geography professor at the University of Guelph, has examined episodes such as the fall of the Roman Empire, the Irish potato famine and the French Revolution—moments when abundance shifted to scarcity. He thinks we’re living through such a period now.
“The reaction to the perception of scarcity often, almost inevitably, makes the problem worse. But in a moment of scarcity you can actually come up with new governance arrangements and new technologies to do really cool things,” Fraser said.
“I’m feeling as optimistic and as pessimistic—and they are completely opposing emotions—as I ever have. I see in this moment of climate change and deglobalization the ingredients of doing things in a new way that’s better. But I also see the ratcheting up of political rhetoric as … us making the problem worse by our reaction.”
Those who have built resilient societies in Asia and elsewhere with far fewer advantages than Canada have long asked why this country isn’t the richest place on Earth. The answer is that it’s been a century since we’ve had to fight for anything. The empire that birthed the Industrial Revolution, then the nation that created the modern global economy, were friends and primary trading partners.
The 2025 election might one day be seen as the moment Canada finally grew into its potential. Trump’s annexation patter knocked us down a peg, putting us in a category with non-G7 members Greenland and Panama. We hadn’t been more vulnerable since the Second World War, when then-prime minister William Lyon MacKenzie King worried that the American troops that had gathered in the north might never leave. The desire to take revenge for Justin Trudeau’s increasingly frustrating time in power was replaced by a bigger ballot question: who was best qualified to rebuild an economy that has good bones, but weak siding.
Who knows? Maybe someday we’ll look back at all of this and laugh. If that day arrives, let’s not forget how menacing it was in the moment. Things got real. Trudeau’s wokeism and Conservative Leader Pierre Poilievre’s anti-wokeism became small. A record number of Canadians voted in advance polls. Liberals and Conservatives will likely divide the support of about 80 per cent of voters, and Carney and Poilievre both got there by emphasizing their aggressive approaches to creating economic resiliency.
“Our southern neighbours, when confronted with a scary situation, seem to have elected the loudest, angriest,” Fraser said. “Canadians when confronted with a scary situation, seem to be gravitating to a middle-ground position.”
Sometimes it’s good to be alone.
Kevin Carmichael is The Logic’s economics columnist and editor-at-large. He has spent more than two decades covering economics, business and finance for outlets including Bloomberg News, The Globe and Mail and the Financial Post, where he also served as editor-in-chief.
Credit: The Logic
