Canada’s Break With Trump Just Got MUCH Bigger

Receipts with Catherine Rampell

The episode explores Canada's strategic pivot toward the European Union as a response to Donald Trump's unpredictable leadership. The hosts

Key takeaways

• Mark Carney has achieved a 70% approval rating in Canada by positioning himself as a leader standing up to Trump.
• Donald Trump's approval rating on handling inflation is at record lows, even lower than Jimmy Carter's administration.

Main topics

• Canada's geopolitical realignment
• Trump and inflation economics

Notable quotes

He is popular because he stood up to Donald Trump.

Conclusion

The episode serves as a warning about the erosion of institutional nor

Transcript preview

Speaker 4 (0:00) Hey, everyone. I'm Catherine Rampell, economics editor here at The Bulwark, joined, as always, on Fridays by my colleague and pal, JVL, who is once again modeling our excellent merch that we offer here at The Bulwark. I love this shirt Speaker 3 (0:14) so much. Speaker 4 (0:15) Yes. Honestly, a friend of mine, unprompted yesterday, told me that she was going to buy the capitalist wing of Antifa shirts as well, which maybe next week I'll model that for you all. You should. That is a shirt Speaker 3 (0:29) designed for you. I Speaker 4 (0:31) think it is. It definitely is. We are going to chat about all sorts of other things that were designed for me, including the economic policy platform Speaker 3 (0:41) of Speaker 4 (0:42) the Canadian government. So we're going to chat a little bit about Canada and how Canada feels about the United States, how Canada feels about Mark Carney. Blame Speaker 3 (0:52) Canada. Blame Canada. Speaker 4 (0:56) deepening relationship, Canadians deepening relationship with the EU, what all of that means for both of our economies, all three of our economies, really. We're going to talk about the Fed and how Donald Trump is hot dog manning himself because he's wondering why the Fed was forced to raise rates. Who's responsible for this? And we're going to talk about some other fun stuff, including some government data that's being kept from you. Speaker 4 (1:22) We have theories about why. And maybe if we're lucky, we'll talk a little bit about our old pal Elon Musk. So JVL, as I said, I want. Speaker 3 (1:32) Right. I take it from your topic rundown that all the things we're going to talk about are great positive developments. Speaker 4 (1:37) They're very cheerful. They're all Speaker 3 (1:39) very, very Speaker 4 (1:40) cheerful. I mean, at the very least, it's cheerful for some people. So Mark Carney, who is our our neighbor to the north. just got the highest approval ratings in Canadian history, 70%. So shout out to Mark Carney. And this is interesting for a number of reasons, including that Mark Carney is like the Catherine Rampell fever dream of what an economic leader should be. He's like he was previously the governor of the Bank of England. He's a he's a trained economist. He had also worked as an investment banker. That's neither here nor there, but generally not the kind of thing on a CV that you would expect to propel someone toward popularity. And of course, in Speaker 3 (2:29) a lab for the two of us. Speaker 4 (2:30) Exactly. Exactly. And apparently for the Canadian populace, because he is implementing a pretty. Darn strict neoliberal agenda. Lots of things that we were told that the people, the populists worldwide no longer wanted, you know, privatizing airports and streamlining government and things like that. And he's still very, very popular. Now, to be fair, he's probably not popular because of those things. He's popular because he stood up to Donald Trump and the world, including the world of Canada, is. hungry for heroes. So I'm curious to hear your thoughts, JVL, on, you know, how you think this works out for Carney and for what we are learning about, which is the potential for Canada to become an associate member of the European Union. Speaker 3 (3:27) I mean, how much time do you have? Because I got a lot of thoughts on this. Speaker 4 (3:30) Oh, please, please. And I think we have a lot of viewers in Canada who want to hear your thoughts. Speaker 3 (3:35) I think you have to start by understanding that Mark Carney is a wartime president. And Canada sees itself totally reasonably as facing an existential conflict against a now hostile superpower to its south, with which it shares a border. And I want to. I want to dial us back here one second by giving an unrelated anecdote, which has been driving me to distraction all week. Three days ago, the president of the United States sent out a tweet on Truth Social, the social network he owns, in which he baldly and specifically accused the Democratic Party of participating in a plot to assassinate him in the summer of 2024. And he said that the Democratic Party was behind this assassination plot. In a normal, sane world, this would have been the most explosive news in American history. It would have been banner headlines on every single newspaper in the country. It would have kicked off crazed reporting and investigations. It would have led the evening news because we would have been in a position where one of two things was going to happen. Either it was going to turn out that this was true and the Democratic Party did participate in a plot to assassinate a presidential candidate, in which case a whole lot of people are going to go to jail. And there was going to have to be like mass reorganization and purging of the Democratic Party from the fascist violent elements within it. Or it was going to turn out that the president of the United States is either insane or a liar. And those things are not mutually exclusive, Speaker 4 (5:25) but not mutually Speaker 3 (5:26) exclusive. But but instead, what happened in America was everybody looked away and just pretended it didn't happen. And so, like, as a thought experiment, I want you to begin by thinking, what would have happened in America if everybody just took the words of the president of the United States seriously? Right. And we could see like it would have set off this large chain of events. Because in America, we live in an insane asylum and we've become acclimated to this and we no longer treat things as having meaning. We just, again, looked away because it would have taken us to uncomfortable conclusions. Nobody wants to have big investigations. Nobody wants to say out loud that the president is a psychopath, right? Because that's really indelicate and, you know, you look like one of those never Trump crazy people. The rest of the world, however, has faced a version of that for the last two years. The president of the United States said that he wanted to annex Canada and turn Canada into a member of the United States and that he was open to, he wouldn't totally rule out, he didn't think using force would be necessary, but he didn't completely rule it out. And he said that it was vital to America's national security and it was vital to America's national security that we annex Greenland. which was part of Denmark. And the rest of the world acted like these words had meaning and like they had to react accordingly. And that is what Mark Carney and Canada have done. And the reaction has been a very, very serious one. I mean, first of all, they swerved and elected Carney, which nobody thought they would. And that was entirely because of what Trump did. And secondly, Carney has absolutely moved to realign Canada from a north-south alignment to an east-west alignment. And he has made overtures to the European Union. He has made overtures towards China. He became the first Canadian prime minister to visit China in like 20 years. And what you've seen also is a total unity of purpose. So earlier this week, Canada held a big investment summit. in Toronto. They brought in foreign investors, people from sovereign wealth funds, CEOs. They're looking to attract about a trillion dollars in investment. And the most notable thing is this was organized by the current government. And the closing speaker was Stephen Harper, who is the most popular Conservative Party prime minister in Canadian history. And Harper and Carney are totally aligned. This would be like having Barack Obama and George W. Bush holding hands in 2010. And that's why he's at 70 % approval. It's because everybody in Canada just treated the words of the American president as if they mattered. Speaker 4 (8:19) Yeah. Well, they I mean, they they should presumably. Speaker 3 (8:22) They should. Right. No, this is again, I'm saying because they are not living in a sane asylum. We are. We are not desensitized. Yeah, they're not desensitized and they shouldn't be. Because when you're talking about your your sovereignty as a nation, like when you don't have that luxury, like we're decadent. And so we are foolish or whatever. We can have a big debate about that. But. It is very important to understand. So he leaves this summit. He goes straight over to Europe. They float the idea in a speech about becoming an associate member of the EU, which is not a thing that exists. They're looking at EU is considering making this happen. He has already begun shifting Canadian defense spending away from America, which is also something the Europeans are doing. This is a, you know, again, these are people just preparing for the breakup of NATO. Speaker 3 (9:13) When you talk to people in defense who were bullish on the idea that NATO could last past Trump, and they would always say, well, it's about interoperability. You know, they're all so reliant on American military systems that they really don't have any choice but to stick with us. And that's all shifting. You've seen huge, huge growth in the European defense sector over the last two years. The Canadians are going to throw in with that. They are no longer going to be interoperable. with America in 10 years. And all of their spending is pointed in that direction. So, and at the same time, reaching across to forge better ties and better relationships with China. And Canada is in a really unique position by dint of its geography and resources to be able to be a counterweight to America in a multipolar. world order right so world order where it's not just an american hegemon it's not just the duopoly two superpowers china and the us but it's truly multipolar right where the eu has decided to be you know come together and act as a true global force their economic throw weight is about the same as america's frankly we need to put them all together and to have canada right there on the northern border working on both sides of that as you know close to the EU, but also able to draw closer to China when necessary could cause us no end of headaches. And, you know, we are going to wind up isolated and alone. And we deserve it because that's what America, the American people chose. Speaker 4 (10:48) Yeah. And I think that's one of the concerning things. It's like a 10 Speaker 3 (10:52) minute monologue. I should stop. But it was a Speaker 4 (10:53) good one. And I think that's partly what's concerning about all of this is that this is not just this momentary. disruption in our relationship between the United States and Canada. This will be enduring. And, you know, this is largely anecdotal on my part, but it is backed up in polling data that Canadians are mad, not just at Donald Trump. They are mad at the American people. And they should be as they should be. They think that the fact that we elected him not once, but twice, you know, once may be a fluke. Right. He lost the popular vote then. Speaker 3 (11:30) He lost the popular vote. People didn't realize they were just taking a chance. The 2024 election is so important, right? Because that is the, no, no, America saw, and they didn't like, this is the other thing about 2024. I'm sorry, I'm interrupting you because I'm just like on a, I'm just fueled by hate fire. Speaker 3 (11:51) The thing about 2024 isn't even that America got through a first Trump administration and they sort of lucked into being unscathed. We had a global pandemic in which a million people died and then he attempted a coup. Speaker 4 (12:06) I mean, we got the worst case scenario Speaker 3 (12:09) and still and they got the worst case scenario. Then they got a. totally fine Democratic administration, which did not force trans surgeries on everybody's kid and did not go into a global depression or anything like that. They got a pretty okay, very normal baseline, median Democratic administration in the intervening four years. And the Americans then said, by increasing his vote share, yeah, we want Trump again. Speaker 4 (12:39) The Speaker 3 (12:39) rest of the world can't ignore that. Speaker 4 (12:41) Yeah. And I think we have some data actually from some recent polling showing that Canadians are more likely to say that they share more in common with