Trade war BACKFIRES?! Canada’s U.S. liquor ban sparks blowback

Well, the ban on US liquor products in

most Canadian provinces has been flagged

as a major trade irritant between the

two countries. This story by the

Canadian press by Canadian policy

flagged by US as trade irritants. The

report by US trade representative

Jameson Greer says US producers are

being shut out of the billion dollar

Canadian market. Last year, Ontario

Premier Doug Ford announced measures

aimed at punishing the US over that

country's tariffs against Canada.

>> I don't start a tariff war, but we're

going to win this tariff war. Right off

the hop,

I've directed the LCBO, where the

largest purchaser of alcohol in the

world, to remove every bit of US alcohol

off the shelves.

>> The US Trade Report includes this quote.

The United States continues to raise

serious concerns regarding these actions

and to press Canada to ensure that US

alcohol beverages immediately and

permanently return to all provincial and

territorial markets. Alberta and

Saskatchewan are the only provinces not

to ban US liquor sales. The US trade

tariffs led to a 25% reduction in the US

trade deficit with Canada. It also led

auto giant Stalantis to shift production

from its Bmpton assembly plant to

Illinois. No, it's not an April Fool's

joke. Life just got a little more

expensive for Canadians thanks to a slew

of new tax hikes for a tiny group of

politicians. However, paychecks just got

bigger and taxpayers get to pay for it

all as usual. This post by Kirk Lubenov,

federal politicians get big pay

increases. You get to pay more for

booze. The federal excise tax for

alcohol is up 2%. So beer, wine, and

spirits will cost you more starting

today. At the start of the year, the

industrial carbon tax went up along with

increases in EI and CPP premiums.

Alberta Premier Daniel Smith wants the

provincial NDP to explain how it plans

to separate itself from its far-left

federal cousin. We're getting a pretty

clear idea of what the principles of the

Federal Party are. They're they're

they're pretty communist. They talk

about nationalizing everything from food

to building houses to construction

companies. They want everyone to have a

heat pump and take an electric electric

an EV bus to work. So, I think it's up

to the provincial NDP to talk about how

they're going to square the circle. If

this is federal policy and they're

required to conform with it, um what are

they going to do to implement it? and

they can't hide behind we're a different

party cuz they're not.

>> Newly minted NDP leader Aby Lewis at the

federal level has called for no new

pipelines, LNG terminals or offshore oil

projects. Our guest today is Kirk

Lubamov who's basically a business

consultant to he's got a great resume.

He joins us from Calgary. Welcome Kirk.

>> Hello. How you doing?

>> Excellent. Thank you. I know you've got

a great presence online. That's where I

noticed you with with your posts

basically, but I'd like you to tell our

audience exactly what it is that you do.

>> Yeah, I work in the intersection of

policy, economics, and capital. So, I

try to

uh predict and advise what's the best

policy to attract capital, but also

where the best places to invest capital

based on what's going on in Canada and

uh in the US. So, you could talk a

little bit about that later on, but I do

want to ask you about this latest

report. This is from Jameson Greer, the

US trade rep, who basically has kind of

uh thrown down the gauntlet a little bit

on the issue of US liquor sales or

products in Canada because, as you know,

Ontario and other provinces, many other

provinces, most have basically banned

the sale of US liquor products in

retaliation for the tariffs that we saw

from the Trump administration. And

apparently we got their attention

because they they've come out and

basically said we really don't like this

and you know this is something that's

got to stop. Uh I can uh ask you now

what you think about that.

>> Well the the really big overall question

is what are they trying to do with this

strategy? Uh at the end of the day we

should be in negotiations. The Kusma

negotiations is happening this year.

It's one of the most important uh trade

documents we have. Uh it gives us

essentially uh 98% tariff uh free uh

trade with the US on 98% of the tariff

lines. Uh it's governs $4 billion in

daily trade. And to throw things into

the wind and just to piss people off

that you should be trying to negotiate

with and save our economy over, you

know, a couple hundred million dollars

worth of liquor sales if that uh is just

such a

a dumb strategy in general to grand

scheme of things of what's happening

here.

>> Yeah. The quote in the report is, "The

United States continues to raise serious

concerns regarding those actions and to

press Canada to ensure that US alcohol

beverages immediately and permanently

return to all provin provincial and

territorial markets." So, they're

serious about this. And I see your

point. I mean, considering how much

trade we do with the United States, to

have an issue like this undermine those

talks that are coming up fast doesn't

seem to make much sense. But I guess we

have particularly provincial premers

like Doug Ford who have their elbows up.

They insist on taking some kind of

retaliatory action against the United

States because they think it's the best

approach in order to discourage and

punish the United States. Sadly, when

you're talking about the differences in

size between our economy and theirs, I

don't think that that's a fight that we

can win if we're going to just stand

there and trade punches with the United

States. Doesn't make much sense to me.

How about you?

No, it doesn't. And what they what

Candace tried to do is uh be selective.

Well, not as much, Doug, for but in

general to overall tariff retaliation

strategy was trying to be selective in

targeting specific products that

particularly impact the red state, which

is Donald Trump's voting states. And uh

you know, we pulled back quite a bit on

it. the Liberals budget I think about

$20 billion in revenue out of tariff

retaliations uh and we dropped most of

it and it's just uh you know we just had

this childish point of uh you know

trying to pick the the most ridiculous

fights throwing pebbles at our biggest

trading partner uh especially with

Toronto and Ontario right now in general

that is essentially dependent on the US

for electricity imports uh which Doug

for by the way thought he would be able

to u turn off exports to the US it just

it just does not make any sense uh you

know it at the end of the day how much

are you willing to risk for such a small

move that any gain locally will happen

let's talk a little bit about investment

because you're very much plugged into

the investment community in Canada I

mean we've seen it reported many times

that Canada is actually losing

investment that billions continue to

leave the country. Certainly, I would

say over the last 10 years, that's

probably true, but you're seeing a

change in that trend that some money is

coming back into the country. Can you

talk a little bit about that?

>> Yeah, the Canadian bonds in general are

track, you know, there is essentially

two ways to look at uh how Canada or how

a country is attracting capital. one

it's into its markets and one into the

more direct economy and in general can

there's really there's a lot of demand

for our bonds I don't know why

especially corporate bonds as well