A recent article in Politico quoting several cabinet members of Prime Minister Mark Carney reflects a particular reality of the problem their economy will face in 2026.

It appears that Canadian government officials have finally recognized the Trump administration plans to dissolve the USMCA or what Canada calls CUSMA next year.  With that reality they have a big problem.

Mexico has been working throughout the year to initiate economic policies in alignment with the United States.  However, structurally and politically this is an alignment that is impossible for Canada to do.  Like many contracting European countries, the economic policies of Canada are centered around their climate change agenda and green energy goals.

For the past few decades Canada bought into the carbon scam and enacted climate change goals into law for carbon pricing, alternative energy production, industry and manufacturing costs.  These mechanisms to control “climate change” are nuts in the big picture.

In order for Canada to position their economy to be in alignment with the rest of North America (USA and Mexico), Carney would have to reverse years of legislated rules and regulations.  That is not going to happen, and Canada will always be at a disadvantage because of it.

(Politico) – […] It’s a moment of existential crisis for Canada, a senior Carney government official told POLITICO. Waiting out the Trump administration isn’t an option, the official said, arguing that what’s happening in the United States reflects a generational shift — not a temporary disruption — and that returning to a policy of closer integration with America would be foolish. (more)

With three quarters of their economic production tied to exports into the USA, and with the USMCA likely to be dissolved in favor of a bilateral trade agreement, Canada now has to find other markets for its products or lower all the trade barriers currently in place.  Prime Minister Mark Carney is trying to find alternative markets.

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This is very interesting.  Treasury Secretary Scott Bessent has announced [Press Release Here] an operation to target money service businesses on the southern border.

The objective is to identify targeted financial transaction businesses who participate in money laundering for cartel and criminal activity.

WASHINGTON— Today, the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) announced a multi-tiered operation targeting more than 100 U.S. money services businesses (MSBs) operating along the southwest border. These MSBs—which provide financial services outside of a formal bank—are being examined for potential non-compliance with regulations designed to detect money laundering and combat illicit finance. FinCEN’s operation resulted in the issuance of six notices of investigation, dozens of examination referrals to the Internal Revenue Service (IRS), and over 50 compliance outreach letters.

“At President Trump’s direction, the Treasury Department is utilizing all tools to stop terrorist cartels, drug traffickers, and human smugglers,” said Secretary of the Treasury Scott Bessent. “This sweeping operation will help root out potential cartel-related money laundering from the U.S. financial system.”

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Today, President Trump will participate in a Mexican Border Defense Medal award ceremony at the White House. The anticipated start time is 3:00pm ET with livestream links below.

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Taking a very significant step to be in alignment with President Trump’s North American trade bloc construct, Mexico has passed a sweeping set of tariffs against Chinese imports.

The motive for the move by President Claudia Sheinbaum and her political party, Morena, which controls both legislative chambers is clear.  Mexico is moving into direct alignment with President Trump as the likelihood for the end of the current USMCA trade agreement looms.

President Trump has sent clear signals expressing his intent to dissolve the USMCA trade agreement in favor of two bilateral agreements, one with Mexico and one with Canada.

The Mexican government led by Sheinbaum have made moves throughout the year to stay in alignment with a favorable trade agreement, while the Canadian government led by Mark Carney has been more antagonistic toward any change.

The Mexican trade leadership seem to have long expected the change to the USMCA, and now there are indications Canada realizes what is about to happen, albeit reluctantly.

As a consequence of their proactive position, Mexico has now passed up to 50% tariffs against a host of imports, mostly textiles, shoes, appliances, cars and automobile parts.  The tariffs will apply to any imports that are not part of a previously organized free trade agreement, which has the practical outcome of hitting mostly imports from China. That approach aligns directly with the tariff rate applied by President Trump toward Beijing.

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This is a remarkable story that has not gained significant attention.  Late last week FBI Deputy Director Andrew Bailey, the Dept of Justice and various law enforcement agencies announced the indictment of two Mississippi Sheriffs, city police chiefs and more than a dozen police officers who were running drugs and taking bribes from Mexican drug cartels.

The U.S. Attorney’s Office in the Norther District of Mississippi coordinated the indictments [SEE HERE].  U.S. Attorney Clay Joyner of the Northern District of Mississippi; Deputy Director Andrew Bailey of the FBI and Special Agent in Charge Robert Eikhoff of the FBI Jackson Field Office made the announcement and held a press conference.

Apparently, what tipped off the feds was several arrested criminals complaining to state and federal law enforcement that local police were demanding bribes they could not afford.  The Mexican drug cartels were paying up to $30,000 to the individual officers, sheriffs and police chiefs’ and the local criminals could not compete with that scale of bribery demand.

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For those who have followed along with the U.S-Canada trade positioning, the current status of conflict between the Trump administration and the government of Canada is not surprising.  {GO DEEP} Going all the way back to the replacement of NAFTA, with the USMCA, President Trump always said he did not favor multilateral trade deals with multiple countries; instead, he preferred bilateral free trade agreements.

Some people have construed the bilateral preference of President Trump to be the elimination of globalism in favor of nationalism in trade agreements.

While the outcome of the Trump approach indeed aligns with that theme, it is not specifically the objective of President Trump to eliminate global trade, but rather to focus on specific interests in trade that benefit the unique nature of each party involved.

As a result, the USMCA -or CUSMA as said in Canada- is not in alignment with a bilateral free trade agreement, and the conflicted differences between trade with Mexico and trade with Canada are an outcome of this dynamic.  The solution is simply to eliminate the multilateral in favor of the bilateral approach.  This is the objective of President Trump as expressed.

That said, the USMCA covers approximately 60% of U.S-Canada trade, and the remaining 40% is being debated and argued.  President Trump would prefer to just deal with 100% of the trade sectors in one free trade agreement; hence, his ambivalence until the USMCA is dissolved.

Canada, on the other hand, continues to demand that all trade conflicts be resolved without opening up the entire USMCA. Again, another conflict. Canada is like the dependent spouse in a divorce arguing for child support payments when the “children” are in their twenties.

The current status is President Trump pulling back completely from discussions with Canada, while the various provincial Premiers and Prime Minister Mark Carney antagonize over the issue.

At a certain point, when the entire national economic plan of Canada is based on “Donald Trump bad”, and all political messaging internally is to proclaim they have no alternative policy positions, the Canadians might not realize it, but they are confirming complete and total dependency on the nation Donald Trump represents.

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In Canada they call the USMCA trade agreement “CUSMA” putting Canada first.  President Trump calls it the USMCA because that’s the order of sequence when the trade negotiations took place, the USA then came Mexico and much later, Canada.  However, Trudeau used his typical Alinsky gaslighting to pretend Canada was always participating; they were not, they came in at the end.

That said, the former NAFTA trade negotiator for Canada, John Weekes, has finally realized President Trump does not intend to renew or renegotiate the USMCA, he intends to dissolve it in favor of two bilateral free trade agreements; one with Mexico and one with Canada.

I’m not sure what finally, and I do mean FINALLY, triggered a Canadian to realize this, but perhaps they finally listened to President Trump telling Canadian Prime Minister Mark Carney [IN MAY] he intends to end it. DUH!  WATCH:

The reality of the U.S-Canada economic relationship and the position of President Donald Trump is not that difficult to understand if you take all the disparate datapoints and quotes from Trump and put them into context.

During a White House meeting with Mark Carney, President Trump essentially told the Canadian Prime Minister why he was in no hurry to get to a deal with Canada.  The 35% tariffs on non-USMCA goods triggered August 1st because the main priority of Trump -looking toward Canada- is to dissolve the USMCA.

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U.S. Secretary of State Marco Rubio addressed the media in Mexico City amidst his tour of Latin America, underscoring U.S. efforts to confront drug cartels, curb migration, and boost regional security cooperation.  Mexico is being squeezed economically with increased internal pressure by cartels about sovereignty, Mexico seeks balanced collaboration. WATCH:

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There are going to be two major stories in 2026 that we will have full context to understand.  Yes, the 2026 midterm politics are going to lead the headlines, but two other issues will have considerable impact.

The first, is the FISA (702) reauthorization, and there is a lot that will surface in the next several months likely to upend the best laid plans of the administrative UniParty [Tulsi Factor].  The second, is the USMCA reauthorization – the end of the trilateral trade agreement, and the structural shift into two separate free trade agreements.

As to the latter issue, while Mexico and Canada are currently in a state of economic flux, only Mexico is preparing to deal with the seismic shift that is about to unfold.  Canada is going to be caught completely off guard.

While Canadian Prime Minister Mark Carney is trotting around Europe trying to establish his relevance amid the pro-Ukraine coalition,  Mexican President Claudia Sheinbaum is spending time focused on her domestic economy.

Mexico is preparing to drop significant tariffs on Chinese imports, a proactive move to position Mexico in advance of the upcoming bilateral discussion.

Sheinbaum knows that right now for every deportation ICE executes, her economy is hit as remittances recede. Simultaneously, for every mile of border wall that is completed, the financial dependency model increases.  President Trump’s leverage in the upcoming bilateral trade negotiation against Mexico increases each day, week and month.

Claudia Sheinbaum is smartly focused on trying to get ahead of the issues, while Mark Carney ignores his vulnerability and is about to make Canada naked to the economic weaknesses created by Justin Trudeau.

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Attorney General Pam Bondi and other top law enforcement officials held a press briefing in Brooklyn, New York, after Sinaloa Cartel boss Ismael “El Mayo” Zambada Garcia pled guilty in federal court.  WATCH:

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