TRUMP'S PRESENTATION OF CANADA-U.S. TARIFFS FRAUGHT WITH LIES

Q: Canada has up to 300 percent tariffs on US dairy products. Should they be embarrassed over their crying about Trump's mere 25 percent tariff?

A: You’ve inflated the Canadian tariff and under reported Trump’s tariff

American milk production is is heavily subsidized. The US government buys any surplus milk, makes it into cheese, and stores it or gives it away. This encourages overproduction and keeps the price of American milk artificially low. If the US government were to quit buying milk many dairy farmers would go out of business.

The Canadian government protects dairy farmers by setting quotas. Dairy farmers get a fair price for their milk and the market is not over supplied. If farmers exceed their quotas they are fined. As a result Canadian milk costs more than American milk but farmers stay in business.

Back in 2018 Trump negotiated a new trade agreement with Canada and Mexico. He called it the best trade deal ever. He is now calling it a bad deal and asking who made it.

As part of the deal Trump wanted to be able to sell surplus American milk to Canada. There’s only so much cheese you can store. Canada didn’t want cheap American milk driving Canadian farmers out of business. So a compromise was struck. American dairy farmers were given a quota and had to pay a 7.5 percent tariff. They also had to meet the higher Canadian health standards. If they exceed their quota the tariff goes to 241 percent. Everybody was happy.

Until now. Now Trump wants a 250 percent tariff on Canadian milk. What he doesn’t realize is that Canadian dairy farmers don’t need the American market. And Canadians don’t need American milk. So if Canada responds with higher tariffs on American milk, the US government gets to make more cheese to give away.

It’s hard to know what Trump is thinking. But it’s easy to see he doesn’t know what he’s doing.