Trump’s power play has ignited a debate over US trade and Canadian sovereignty. Sounds like 1988

Donald Trump repeated thoughts on the entry of Canada into the United States have — not surprisingly — raised their hackles in Ottawa.

“There’s no chance in hell of a snowball,” the prime minister retorted Justin Trudeauwhile the Minister of Finance Dominic Le Blanc remarked, “The joke’s over.” Opposition leaders are similarly angry, with conservative Pierre Poilievre asserting “Canada will never be the 51st state” and New Democrat Jagmeet Singh speaking to the incoming president to “cut the crap”.

However, the newly elected American president remains pushing Canadian buttons. He suggested that the highly integrated economies and trade relations between the two countries were overstated, and argued that the trade imbalance meant the US was subsidizing its northern neighbor’s economy.

In doing so, Trump highlighted a persistent concern expressed by some on this side of the border: namely, that Canada’s national sovereignty is threatened by too close ties to the United States.

This is not a new concern — in fact, it will be familiar to anyone who remembers when Canada first eyed a free trade agreement with the US back in the 1980s, long before Trump’s influence extended beyond Manhattan’s real estate sector.

The road to free trade

During Pierre Trudeau’s final years as prime minister, the wheels were set in motion for Canada to consider a free trade agreement with the US

The country was affected recession of the early 1980sand in 1982 a Royal Commission was establishedled by Donald Macdonald, a former Liberal government minister. Among its objectives was an examination of future prospects and challenges for the Canadian economy.

When the commission’s report came out in 1985, it supported Canada’s pursuit of a path forward in free trade with the U.S.—with the goal of building improved and secure access to the U.S. market—but nonetheless noted that “the denial of that access is an ever-present threat.”

Then-Prime Minister Brian Mulroney, whose Progressive Conservatives came to power at the expense of the liberals a year earlierhe was intrigued by what the commission discovered.

“There is a certain degree of hard work and achievement evident and some very interesting ideas that will have to be carefully examined,” Mulroney said.

Some business leaders they were delighted with the possibility of a future free trade agreement, while labor groups were very concerned — including the potential job losses.

Not all politicians were involved either.

“If we move toward a free trade agreement with the United States, I think the political consequences are very clear,” said Bob Rae, then leader of the Ontario New Democrats.

“Don’t ask the people who are elected in provincial or federal elections to do a good job of managing the economy because all those decisions will be made in New York, Chicago and Washington, and we will simply become a client of the United States.”

Nevertheless, Ottawa entered into negotiations with Washington. A proposed deal was reached in October 1987, and a free trade agreement was signed by Mulroney and US President Ronald Reagan in January 1988.

But free trade has not yet taken effect.

Liberal Leader John Turner has signaled his party won’t make it easy for the government to implement what he called the “Sell Canada Act.”

“We intend to fight across the country, we intend to fight in parliament,” Turner said. “We intend to fight it every inch.”

New Democrat leader Ed Broadbent claimed there had not been an “open and honest debate” about all the details of what free trade would entail.

Margaret Thatcher’s view

The broad discussion of the free trade debate even brought Margaret Thatcher to the fore when the British Prime Minister visited Canada in June 1988.

“You need not fear that the national personality of Canada will be diminished in any way [in pursuing a free-trade deal]Thatcher said.

Her unsolicited comment in parliament would lead to opposition leaders in the country calling out the so-called Iron Lady for meddling in domestic politics.

“She has interfered in our national debate on an issue that is likely to dominate the next general election in this country,” Turner said later that day.

“We are no longer a colony of Great Britain and we do not want to become a colony of the United States,” he added.

The NDP’s Broadbent questioned whether Thatcher had the right to “come over here and interfere in Canadian affairs.”

Turner called on Mulroney to call an election to give Canadians a chance to have their say on the issue. When the election was called in early October, Mulroney said free trade would be at the center of the campaign that will send Canadians to the polls next month.

Free trade and national sovereignty

Liberals and New Democrats quickly pushed for a televised debate devoted exclusively to the issue. But the Progressive Conservatives were cool to the idea.

Broadbent suggested that Mulroney understood that “the more Canadians know about the trade deal he negotiated with the United States, the more unhappy they become.”

The divisive topic has indeed been a point of contention among leaders – including concerns about how the deal could affect Canada’s national sovereignty.

Turner argued that moving to free trade would limit Canada’s ability to maneuver under American control.

“I happen to believe you’ve sold us out,” Turner told Mulroney during an English-language debate on October 25, 1988.

In Mulroney’s response, he dismissed the accusations and said his liberal opponent “did not have a monopoly on patriotism.”

Mulroney’s Tories will return to power — again with an overwhelming majority, but with fewer seats than before.

The 1988 election would be the last in which Mulroney, Turner and Broadbent would lead their parties.

Turner passed away in September 2020. Both Broadbent and Mulroney died in 2024. The bitter battle over free trade was part of their legacy as federal leaders.

The original free trade agreement between Canada and the United States entered into force on the first day of 1989.

Five years later, it was replaced by the North American Free Trade Agreement (NAFTA). Then in April 2020 there is NAFTA replaced by CUSMA — the Canada-US-Mexico trade agreement — which was negotiated at Trump’s behest during his first term in the White House.

After his re-election in November, Trump announced that he would impose a 25 percent tariff on all products entering the country from Canada and Mexico. That threat, along with his later “51st state” remarks, were seen by some as a sign of his intention to renegotiate CUSMA.