The Disintegration Of North America – OpEd

Almost exactly 30 years ago, Canadian Bacon depicted a U.S. president picking on his neighbor to the north to boost his sagging approval ratings. Starring Alan Alda, John Candy, and Rhea Perlman, the film was supposed to be a comedy. Director Michael Moore was trying to satirize the U.S. penchant for invading other countries. Taking that notion to its absurd limit, Moore chose to depict a skirmish with Canada.

Ah, the good old days, when you could laugh about such things.

Marx once wrote, with regard to the return of a Bonaparte, that “history repeats itself, first as tragedy, then as farce.” Obviously, Marx couldn’t have anticipated the rise of Donald Trump, who has made a political career of turning Marx on his head by transforming farce into tragedy. Just compare his first term (hah-hah!) to his second term (uh-oh!).

When it comes to Canada, Trump hasn’t yet sent the U.S. army across the border. But don’t rule it out—or the more likely possibility that he’ll dispatch military forces to Mexico to battle narcotraffickers (or stop Central American migrants in their tracks).

In the meantime, Trump has managed to use his beloved tariffs to disrupt economic relations with both Canada and Mexico. Amid boycotts of U.S. products and a steep decline in tourists heading south, Canadian Prime Minister Mark Carney declared that the U.S.-Canadian relationship, “based on deepening integration of our economies and tight security and military cooperation, is over.”

Mexico’s Claudia Sheinbaum, while talking tough on Mexican sovereignty, has taken a different tack by negotiating mano a manowith Trump. But disputes over water, drugs, and migrants nevertheless are pushing relations to a breaking point. Trump has already rushed U.S. troops to take control of land near the southern border. It wouldn’t take much for him to push them over the line.

The trade agreement that replaced NAFTA and that Trump himself touted so much when he signed it into law in 2020 is coming up for revision. It’s hard not to anticipate that the rancor Trump has stirred up to the north and south will doom this effort before it even begins.

Perhaps like a Silicon Valley entrepreneur, Trump sees North America as a model that needs disruption. But usually such entrepreneurs have an alternative in their back pockets to substitute for the supposedly flawed status quo—Uber replacing taxis, say, or iPhones superseding flip phones.

What alternative could Trump possibly be proposing for North America?

Spheres of Influence

It’s popular in some circles to imagine that Donald Trump is a geopolitical strategist. Here, too, it’s a case of farce being overtaken by tragedy. Trump a foreign policy expert? What a joke. Oh, wait, it’s actually worse than that…

Consider, for instance, the notion that Trump is executing a “reverse Kissinger” with his policy toward Russia. Half a century ago, Richard Nixon, guided by his advisor Henry Kissinger, executed a rapprochement with China to put pressure on the Soviet Union. Today, according to this fanciful theory, Trump is pushing a détente with Russia in order to put pressure on China.

There’s no such hidden calculus in Trump’s wooing of Putin. The two leaders share ideological obsessions—love of territorial expansion and autocratic control, hatred of liberals and “woke” constituencies—and Trump wants to end the war in Ukraine by any means necessary. China occupies a different part of his mind: an economic competitor with little to no ideological overlap.

Now let’s consider another attempt to impose geopolitical sense on an otherwise disparate set of administration policies: that Trump wants to reestablish an older world order based on spheres of influence.

According to this notion, Trump would be happy to allow China to preside over an Asia-Pacific sphere. Russia would then administer the territory of the former Soviet Union. Europe would have to give up on Ukraine but it would get in return North Africa and perhaps all points south. Israel, as a kind of representative of Europe, would divide up the Middle East with the Saudis.

And the United States would reign supreme in North America—plus, according to the Monroe Doctrine, all of Latin America. Throw in Greenland and Trump would be looking to make the Americas great again.

Such a division of the world might well appeal to Trump’s business mentality, with countries substituting for corporate empires that control clearly demarcated markets.

But Trump is not withdrawing the United States from the Pacific theater any time soon. His administration is doubling down on its containment of China—through alliances, expansion of Pacific bases, and increased Pentagon spending. Perhaps he’s willing to tolerate Chinese control over the territory it claims, including Taiwan. But even that is not clear, given recent U.S.-Philippine combat drills in the South China Sea and the sanctions slapped on Hong Kong officials for facilitating the suppression of that territory’s democracy movement. Moreover, he hasn’t given up on other parts of the world—Ukraine, Africa—where he wants what’s underneath the ground.

Trump’s tariffs point to a different strategy, not spheres of influence so much as anti-globalization, pure and simple. Trump is suspicious of any international effort that puts the United States at a table of equals, and he’s deaf to the reality that the United States was always first among equals when it came to globalization. Trump doesn’t like the UN, the IMF, the ICC. He doesn’t like the nervous system of economic globalization with its multilateral trade deals and regulatory superstructure. He much prefers bilateral relations where the United States can throw its weight around and intimidate weaker countries. He despises the EU because its gives smaller nations like Denmark the power to stand up to the United States.

Which brings us back to North America.

The Tariffs that Divide

Tariffs against Mexico and Canada don’t make any economic sense. It’s not just that they piss off friends, boost prices at home, and fail to raise the revenue that Trump fantasizes about.

It’s the nature of the economic relationship between the countries that render these tariffs self-defeating.

Consider the example of medical devices. Mexico is the third largest exporter of medical instruments in the world, and it sends nearly $12 billion worth of these instruments to the United States. Tariffs on these imports will raise the costs for U.S. hospitals and, by extension, the patients in these hospitals.

Ah, but guess what: those devices made in Mexico are heavily dependent on U.S. microchips. And the CHIPS Act under the Biden administration sought to tighten that relationship in order to reduce dependence on semiconductors produced in Asia. So, imposing tariffs on Mexican manufacturers will also penalize American companies that produce components for those medical devices. That means the disappearance of U.S. jobs and the U.S. competitive edge in high-tech exports. And that’s only one industry.

The same perverse economic logic applies to U.S. car manufacturing, since there is no such thing as a completely American-made car. About 40 percent of car parts are made overseas, with Mexico supplying last year about 42 percent of those parts and Canada 10 percent. Trump, apparently unaware of the reality of supply chains, stepped back recently to consider a temporary waiver on tariffs for car parts to help Detroit make the transition to U.S.-made parts. But why would anyone make those huge investments into car-part manufacturing plants in the United States if a future president—or the ever-mercurial Trump himself—might change economic policy and strand those assets?

So, forget about the advantages of creating a North American market that relies on comparative advantages (more hydroelectric power in Canada, a longer growing season in Mexico). Trump sees a trade deficit and believes that the country is ripping off the United States. (Wait, didn’t he go to the Wharton School? Did he skip Econ 101?)

Yes, there are problems with globalization, from a race to the bottom around labor and environmental standards to the ridiculous carbon emissions associated with the modern equivalent of sending coals to Newcastle. But Trump’s tariffs are not designed to address any of these defects.

Instead, Trump’s moves will simply reorient global trade around the United States, just like it’s a huge, stupid rock in the middle of a river. At the moment, fully three-quarters of Canadian and Mexican exports go the United States (and around a third of U.S. exports go to Canada and Mexico). Despite the convenience of exporting to a neighbor, Canada and Mexico are going to start looking elsewhere to sell their products. Other countries—China, Germany—are going to reap the advantages of Trump’s economic idiocy.

The Future of North America

Canada is not going to become the fifty-first American state. Even if Canadians favored such a move—and 80 percent strongly oppose it—the Republican Party would ultimately vote to keep Canada out. Republicans don’t even want to make Washington DC a state, for fear of adding two more Democrats to the Senate. They’re obviously not going to welcome all those left-of-center Canadians into the U.S. Congress.

Instead, Trump is pushing Canada further away. It will move closer to Europe. Despite current trade tensions with China, it might mend fences and form a stronger economic bond there as well.

U.S. relations with Mexico may also go south, very quickly. The Trump administration has been considering drone strikes against Mexican drug cartels. Although the two countries are coordinating surveillance of these cartels, Trump is reserving the right to strike unilaterally. “We reject any form of intervention or interference,” Claudia Sheinbaum has responded.

Ordinarily, the three countries would handle their disputes—the economic ones at least—through the revision of the U.S.-Mexico-Canada Agreement, the replacement of NAFTA that Trump himself supported. But Trump’s unilateral actions throw into question whether the USMCA will survive. The U.S. president might well threaten to withdraw from the agreement if Mexico and Canada don’t make future concessions, especially around keeping China out of their markets. Trump might aim for two bilateral treaties instead.

Bullying, alas, does often produce results. Trump can strong-arm weaker parties—Colombia, Columbia University—into making agreements. But that only works in the short term. Over time, the weak find stronger allies so that they can eventually stand up to the bullying.

China and the European Union are patiently watching Trump’s destruction of North America. Sure, they’ll suffer some collateral damage. But the opportunities that Trump’s disruptions are producing will turn Liberation Day for America into a Christmas bonanza for everyone else.

• This article was published at FPIF