The trade war between the United States and Canada—more exactly between the American government and the Canadian government(s)—helps illustrate the opposition between two regimes: free trade between individuals or private organizations, which creates mutual gains and favors peaceful relations; trade between governments or directed by them, that is, mercantilism, which generates conflicts and hatred.
After US President Donald Trump had announced 10% tariffs on imports of Canadian “energy products” and 25% import tariffs on all other goods, the federal government of Canada announced retaliatory tariffs on American exports. The premier of the province of Ontario, Doug Ford, just announced a provincial tax of 25% on Ontarian exports of electricity to New York, Michigan, and Minnesota. He declared (“Ontario Hits Power Exports to US With 25% Surcharge as Trade War Accelerates,” Financial Times, March 10, 2020):
If necessary, if the United States escalates, I will not hesitate to shut the electricity off completely.”
He had previously said (“Canada to Cut Off Electricity to US States: ‘Need to Feel the Pain,’” Newsweek, March 4, 2025):
If they want to try to annihilate Ontario, I will do everything—including cut off their energy with a smile on my face, and I’m encouraging every other province to do the same.
They rely on our energy. They need to feel the pain.
Individuals and their private parties trade together with a smile on their faces. Governments intervene in trade and impose pain with a smile on their collective face, if we may use that analogy. The fact that the Ontario Government owns or directly controls a large part of the production and distribution of electricity in Ontario (“our energy”), as do to a lesser extent the governments of the importing US states, does not help depoliticize the market. Subject to weak constitutional constraints, governments can anyway impose tariffs, taxes, and prohibitions on whom they decide, and the consequence is not universal love.
That Mr. Ford is himself a conservative with a populist streak, who once expressed his support for Mr. Trump, should remind us to beware of the “will of the people.”
In a recent post, I quoted Henry Adams, who wrote that
politics, as a practice, whatever its professions, has always been the systematic organisation of hatreds.
From a moral viewpoint as opposed to a narrow economic viewpoint, which ruler starts the conflict is not irrelevant.
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Two mercantilist kings
