The issue was never really about Canada tolling; the real issue was about ‘cost overruns’ against the backdrop of how the tolling revenue was being used for repayment to the govt of Canada.  It’s a rather sticky situation.

The Canadian government backstopped the financing of the bridge construction.  The deal was that Canada would use tolling to pay the govt back and subsequent tolls would split 50/50 with U.S.  However, cost overruns made the Canadian payback a little less clear as the govt expected more revenue than originally proposed.  Sketchy.

[SOURCE]

The deal currently being revealed as a compromise includes an immediate 50/50 split where Canada gets 50 per cent of the toll profits — after operational expenses — and the other half will go to a U.S-run regional development project for a 15-year time frame.

According to Global News, “The agreement also requires the Windsor-Detroit Bridge Authority to consult the U.S. on any toll changes greater than 10 per cent, the source said, or if it’s looking to lower tolls below those of comparable regional averages.”  Additionally, in Politico “they will guarantee and ensure that we’re not pouring Chinese cars over that bridge.”

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The European auto industry is a case study on how short-sighted trade policy goals, results in consequences.

Previously, German auto companies like Volkswagen entered into trade agreements with China and began manufacturing their vehicles with immediate financial success in the market.  However, it did not take long for Chinese auto companies to reverse the engineering and begin to deliver the same quality vehicles at much lower prices.

The Chinese then stop purchasing the Volkswagen vehicles and purchase the cheaper version, while simultaneously begin exporting those same vehicles into the home market from where the technology originated.

Today, with a double-digit decline in production, Volkswagen announces they will cut almost half of their models due to diminished sales.

BLOOMBERG – BERLIN — Volkswagen reported weak sales numbers on Friday, a day after the giant German automaker announced plans to slash the number of models by nearly half as sales plunged, particularly in China.

The Wolfsburg, Germany-based company said group sales fell 8.6 per cent in the second quarter to just under 2.1 million vehicles, with sales in China alone plummeted by more than one-third.

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Both Toyota and Honda had previously warned the Canadian government that without the USMCA they would shift production from Canada to the U.S. to avoid tariffs and secure long-term manufacturing stability.  We presume a similar message was conveyed to Mexico.

Earlier today Toyota announced they were moving half of their Tacoma Truck production from Mexico to an expanded facility in Texas that will now encompass 5 million square feet in San Antonio.

(Bloomberg) — Toyota Motor Corp. is moving production of its popular Tacoma midsize truck from a plant in Mexico to San Antonio as part of a $3.6 billion investment in the Texas facility.

The Japanese carmaker will build a second production line in San Antonio, where it currently makes full-size pickups and SUVs, and add some 2,000 new jobs by 2030, it said Monday.

The shift, following Toyota’s pledge last year to spend $10 billion on its US manufacturing operations over the next decade, comes as talks between the US and Mexico to renew a North American free trade agreement have stalled. President Donald Trump, who has pressed Toyota to invest more in the US, let a July 1 deadline pass without a trade pact extension.

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FACT: It has been over 60-years since Canada purchased a submarine.  FACT: Canada has never built one.  FACT: Currently the Canadian military have ONE operable submarine out of a fleet of four used ones previously purchased. FACT: Canada recently proclaimed themselves as the North American defender of the Arctic.

Now, put all those facts in the overlay of the December 2024 meeting in Mar-a-Lago between President Trump and Canadian Prime Minister Justin Trudeau.  President Trump was demanding that Trudeau increase their NATO spending and develop a working Canadian military.

Someone recently asked in the comments section why I have an issue with Canada, specifically why a new level of distain for our Northern neighbors.  Quite simply, there is a level of lying that exceeds my tongue bite capacity; that level of deceit comes when fabricating lies is accompanied by pretending. The Canadian government is the worst type of political abuser.  They willfully pretend and simultaneously lie to the Canadian people. That’s the answer.

Today, the government of Canadian Prime Minister Mark Carney announce that German industrial shipbuilder TKMS will be awarded a contract for “up to 12 submarines” valued between $20 and $30 billion {source link}.  Now, let’s not pretend.

First, the submarine contract is intended to get Canada back into reasonable position on their NATO obligations.

In reality, it is quite remarkable to think about the Canadian nation with only one currently functional submarine. “Canada hasn’t purchased unused submarines since the 1960s, during the Cold War, and has never ordered anywhere near 12 at once. Canada currently owns four subs, all of which were purchased second-hand, and only one of which is typically operational.” {citation} Now, think about that Mar-a-Lago conversation again.

Second, Canada can’t build their own submarines?

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U.S. Ambassador to Canada Pete Hoekstra appears for an interview on CBC News to share perspectives on U.S-Canada relations.  However, what happens within the interview is a case study on how Canadian media represent an extension of the Canadian government.

This example is exactly why the Canadian people have no reference point for information counter to the official propaganda policy from their government offices. Rebecca Zandbergen, host of CBC’s Ottawa Morning represents the voice of government in combative tone, condescending attitude and refusal to accept counter arguments.

The level of passive-aggressive condescension highlights why Canada has continued to lose position in a world where pretending has become devalued.  However, it’s clear why the Canadian people will be stunned when it all collapses around them.  They have no reference points. Ambassador Hoekstra should get hazard pay. WATCH (prompted):

I like how Hoekstra reminds Rebecca Zandbergen that the 51st state issue surfaced as an outcome of a discussion between Prime Minister Justin Trudeau and President Trump in Mar-a-Lago that centered around NATO spending and reciprocity in trade via non-tariff barriers.  The points Ambassador Hoekstra makes at the end of this interview are exactly on point, and yet Zandbergen pretends not to understand them.

The American govt is not running anti-Carney advertising in Canada. Americans are not banning Canadian products. The American Government is not telling Americans not to travel to Canada.  The American govt has not banned Canadian companies from bidding on contracts.  These are all actions taken by the Canadian government.

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The media and Canadian government discussions around the U.S-Canada trade and economic relationship, specifically as they pertain to the USMCA (CUSMA) continue to be fascinating.

As we noted over a year ago, the expressed perception from the Canadian side was remarkably disconnected from the most likely scenario.

The level of entrenched disbelief that the U.S. could completely separate from a trilateral trade deal in favor of a bilateral replacement has been remarkable to watch.

However, for the first time today Canadian media began admitting to themselves the USMCA can technically be terminated within six months; albeit buried at the end of the article.

GLOBAL NEWS – […] “I’m not in a position to guarantee anything. These decisions are made at the White House. They are made by the president,” Hoekstra said.

His comments come just days after the Trump administration declined to extend the trilateral pact with Canada and Mexico for a new 16-year term, citing what the U.S. calls “shortcomings” and “trade deficits.” Mexico and Canada both publicly pushed for a renewal.

U.S. President Donald Trump suggested last month that the U.S. is “better without” CUSMA, and that he’d even prefer to see it “terminated.”

When asked by Global News, Hoekstra would not say if the administration is considering ripping up the deal, which can be done by any party with six months’ formal notice. 

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I’ve said it before, U.S. Ambassador to Canada Pete Hoekstra is the most underpaid U.S. emissary sent to a hostile nation and constantly surrounded by threats, bitterness, anger and hatred.

It would be easier to be U.S. ambassador to North Korea.

There is so much nuance inside this interview, it is remarkable.

Ambassador Hoekstra tries in his best diplomatic form to tell the two Canadians Michael LeBlanc and Dr. Sylvain Charlebois about the underlying nature of the U.S-Canada trade conflicts.  However, in typical Canadian fashion both indoctrinated interviewers are curiously stumped by the points Hoekstra presents.  I am prompting this one because you also need to see the body/facial language. WATCH:

[SIDENOTE: The Canadians needed to turn off the comments on YouTube because Canadians are angry, bitter, abusive, vulgar and nasty in every comment section on the subject of U.S-Canada relations.]

Canada’s greatest strategic weakness is what Canadians call their greatest strength, pride.

There is a big difference between being proud and being prideful. The Canadian worldview is based on the latter.

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Appealing almost entirely to an audience that doesn’t recognize the issues that really matter, Fox News has the opportunity to discuss U.S. trade policy with Jamieson Greer yet flubs the entire interview.

Instead of asking about the USMCA withdrawal announcement and the ongoing trade discussions with Mexico, the Fox News pundits misdirect Greer’s expertise and ask questions about the jobs report, the Federal Reserve and the Democrat Socialists of America in elections.  Seriously, no joke.

When serious people remark that Fox News is nothing except propaganda for out of touch ‘boomers’ (a pejorative), this Fox News interview is a case study in why many people now hold that opinion. It’s difficult to argue they’re wrong.

That said, within the one minute where trade was actually discussed, USTR Jamieson Greer points out that many Democrats and many Republicans are completely in favor of eliminating the USTR and resetting the baseline of North American trade.  This is a key point, because within the economic policy issues the left-right dynamic should not be the prism that matters.  Remember, MAGA and the Bernie Bros agreed on 80% of the economic problem. WATCH:

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U.S. Trade Representative Jamieson Greer has made it official.  Delivering an official statement today following a discussion between the United States, Mexico and Canada, USTR Jamieson Greer informed the group the USA will not be renewing the USMCA trilateral trade agreement. [SOURCE]

[SOURCE]

Unfortunately, yet predictably given how much false information has been pushed on this issue, the Canadian team will now believe they have a period of ten consecutive years of negotiation before the trade deal is over.  This is structurally and completely false.  The Canadian media will likely continue selling this false hope.

In reality, with the non-renewal announcement now made, President Trump and USTR Greer can now complete the bilateral trade discussions with Mexico (noted in the announcement) and then move to stage two.

Stage two will be the United States announcing a complete withdrawal from the USMCA, which triggers a six-month countdown clock.   The formal notification of withdrawal will likely happen once the U.S. and Mexico complete the bilateral free trade agreement.

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The Canadian dollar is starting to feel the effects of long-term uncertainty. It will get worse.

...”Since the start of June, the currency has weakened 2.9%, which would be its steepest monthly decline since October 2024, as Canadian bond yields fell further below U.S. yields.”… {source}

Now, this is where you really need to pay attention to details.  Remember, the U.K and EU have a vested interest in protecting Canada from economic collapse.

President Trump doesn’t want immediate collapse either -because Xi will move in fast- but Trump is not going to provide the same financial and economic lifelines that the other four-eyes will trigger.

Reuters is reporting that tomorrow the U.S. will formally declare a “non-extension” of the USMCA trade agreement {ARTICLE} and that triggers a 10-year period to decoupling.  It is very important to understand there is a difference between announcing a “non-extension” and announcing a “withdrawal“.  The Canadians are completely confused about what is about to happen.

In a non-extension announcement, the USA is saying they do not want to extend or renew the terms of the agreement beyond the current trade agreement terms.  Yes, this is a 10-year exit.  However, that’s not the part that matters.  Announcing a decision to exit the USMCA (CUSMA), a full withdrawal from the trilateral deal, triggers a six-month countdown to exit.

The deadline to announce the decision to extend is tomorrow, July 1st.  There is no deadline on the timeline to announce an exit or withdrawal from the USMCA. That announcement can happen at any time.

Put simply, announcing a non-renewal is a 10-year exit.  Announcing a withdrawal is a 6-month exit.  The announcement to withdraw can come at any time after the statement of non-renewal.

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