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U.S. President Donald Trump has abruptly ended all trade negotiations with Canada after the release of an Ontario government advertisement that quoted Ronald Reagan’s 1987 warning against tariffs.
The move has reignited U.S.-Canada trade tensions, threatening billions in cross-border commerce and straining one of the world’s most integrated economic partnerships.
What Triggered Trump’s Decision
The Ontario government’s new ad campaign featured clips from a 1987 Reagan radio address, where the former U.S. president said, “Trade barriers hurt every American worker.” The ad, aimed at American audiences, was designed to highlight opposition to Trump’s 35% tariffs on Canadian steel, aluminum, timber, and automobiles.
In a post on his Truth Social platform, Trump accused Canada of “fraudulently using an advertisement” and trying to “interfere with U.S. court decisions” on the legality of his global tariffs.
“Based on their egregious behavior, all trade negotiations with Canada are hereby terminated,” Trump wrote.
U.S. Secretary of State Marco Rubio confirmed on Friday that talks with Ottawa had been “suspended indefinitely,” citing direct orders from the president.
Canada Responds: “We Are Stronger Together”
Ontario Premier Doug Ford, whose government paid for the ad, defended it as part of an effort to fight for “fair trade and cooperation.”
“Using every tool we have, we’ll never stop making the case against American tariffs on Canada,” Ford said. “The way to prosperity is by working together.”
Ford later posted on X (formerly Twitter):
“President Ronald Reagan knew that we are stronger together.”
Canadian Prime Minister Mark Carney expressed disappointment, calling Trump’s decision “unfortunate and counterproductive,” while emphasizing that Canada remains “committed to constructive dialogue.”
Canada depends heavily on trade with its southern neighbor. Over 75% of Canadian exports go to the U.S., with more than C$3.6 billion (£1.9 billion) worth of goods and services crossing the border daily.
Economic Fallout: What’s at Stake
The collapse of trade negotiations threatens to worsen the ongoing North American trade war. Economists warn that the tariffs and diplomatic freeze could:
Drive up consumer prices in both countries.
Disrupt manufacturing and automotive supply chains.
Reduce investment and employment in Canadian industry.
Further pressure the Canadian dollar against the U.S. currency.
Ontario’s manufacturing sector, already struggling from earlier tariffs, faces potential job losses. Analysts estimate up to 40,000 jobs could be at risk if trade restrictions remain in place into 2026.
Reagan Foundation Condemns “Misrepresentation”
The Ronald Reagan Presidential Foundation & Institute criticized Ontario’s use of Reagan’s voice and image, saying the ad “selectively edited” his remarks and “misrepresents his original message.”
The foundation confirmed that no permission had been granted to use the footage and said it is “reviewing its legal options.” Trump cited this criticism directly in his Truth Social post, saying it proved Canada had acted “dishonestly.”
Global Trade Implications
Trump’s decision also signals a broader hardening of U.S. trade policy during his second term. In recent weeks, Washington has:
Imposed new sanctions on Russian energy giants Rosneft and Lukoil.
Scheduled high-level trade talks with China amid renewed tensions.
Begun preparing for a review of the U.S.-Mexico-Canada Agreement (USMCA).
The administration’s stance underscores a renewed “America First” economic strategy, focusing on protecting U.S. industries through tariffs, sanctions, and aggressive renegotiation of trade deals.
Reagan’s Warning on Protectionism
The irony of using Reagan’s words to criticize tariffs has not gone unnoticed. The 1987 speech was delivered as Reagan sought to calm trade tensions with Japan while defending selective duties on semiconductors.
In his address, Reagan warned:
“When someone says, ‘Let’s impose tariffs on foreign imports,’ it looks like they’re doing the patriotic thing by protecting American jobs. But over the long run, such trade barriers hurt every American worker and consumer.”
He cautioned that protectionism leads to retaliation, economic decline, and job losses, recalling how high tariffs worsened the Great Depression.
What Happens Next
The collapse of negotiations has already rattled markets. Financial analysts expect:
Lower Canadian export growth in the fourth quarter of 2025.
Increased volatility in North American stock markets.
Possible World Trade Organization (WTO) involvement if the dispute escalates.
Prime Minister Carney has vowed to pursue trade diversification, strengthening ties with European and Asia-Pacific markets to reduce dependence on the United States.
The Bottom Line
The end of U.S.-Canada trade negotiations underscores the volatility of Trump’s second-term economic policy. While the move appeals to his domestic supporters, it risks destabilizing North America’s most vital trade relationship.
A senior Canadian trade official summed it up:
“Canada has always believed in building bridges, not burning them. But this time, it’s the bridge itself that’s under fire.”
Key Takeaways
Trump ends all trade talks with Canada after Ontario ad quoting Reagan sparks outrage.
35% tariffs on Canadian imports remain in place, threatening manufacturing and exports.
Reagan Foundation condemns ad as misleading and unauthorized.
Ontario Premier Doug Ford defends campaign, citing “fair trade” advocacy.
Canadian PM Mark Carney seeks to diversify export markets amid escalating trade war.
Economic analysts warn of job losses, inflation, and supply chain disruption.
U.S. foreign trade policy continues shifting toward protectionism and unilateral action.
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