Donald Trump stood in front of a crowd of fans inside the Capital One arena in Washington D.C. on inauguration day. Having just taken the oath of office and been sworn in as President of the United States, Trump sat at a desk on the stage and began signing documents, as the crowd cheered. After each signature, he threw his pen into the crowd, and his supporters jumped over one another to catch them.
The documents he was signing were Executive Orders, presidential decrees that outline the first-day priorities of the new administration. He signed a raft of new orders which aim to reshape the American government in his image.
Many of those orders have significant implications for Canada. When it comes to issues around migration, climate, and trade, U.S. policy has major spillover effects over the border.
Migration and militarization at the border
Day one of the second Trump administration was defined, in large part, by his declaration of war against migrants in the United States. That language is not a particular exaggeration—among Trump’s raft of executive orders, he officially declares irregular migration across the U.S.-Mexico border to be an “invasion” of the country and proclaims unilateral, wartime presidential power to stop it.
In large part, it’s a three-prong plan—deploy the military at the actual border, create a massive deportation machine inside the United States under the Department of Homeland Security (DHS), and suspend many avenues for legal immigration.
First, he has declared a state of emergency at the U.S.-Mexico border, and mandated the Department of Defense—that is, the military—to stop it, bypassing restrictions on military deployment on American soil using the language of emergency. The declaration also greenlights resources towards the construction of a border wall, a mainstay of Trump’s 2016 campaign.
Trump then mandated that people accused of breaking America’s immigration law be held in detention centres until their deportation dates, and provided DHS a mandate to use “all legally available resources” to construct new detention centres for migrants. In Trump’s first term, hastily constructed detention centres evoked parallels to concentration camps.
DHS is also mandated to establish Homeland Security Task Forces (HSTFs) in each U.S. state to manage and expedite deportations. America’s immigration police—Immigration and Customs Enforcement (ICE)—is under the banner of DHS. ICE is also mandated to create a specific office to publish information about “migrant crime.” It is mandated to investigate non-governmental organizations that provide support for migrants. Trump’s orders also make explicit reference to plans to apply diplomatic pressure to other countries to accept migrants that the U.S. plans to deport in order to facilitate their speedy removal.
The border itself will be under the jurisdiction of the United States Northern Command (USNORTHCOM), the military command structure responsible for the United States, Canada, Mexico, and various island countries near the Gulf of Mexico.
While most of his directions are targeted towards the Mexico border specifically, Trump also gives USNORTHCOM a mandate to “seal the borders” more broadly. He also refers to the need for “obtaining complete operational control of the borders of the United States,” without specifying further. One could interpret these orders as applying to the U.S.-Canada border as well—and considering Trump’s post-election talk about how Canada needs to take greater action on the border, it’s not exactly far-fetched.
Trump’s war on migrants extends to legal immigration as well. He suspended the U.S. Refugee Admissions Program (USRAP), the program through which all refugee claimants pass through in the U.S., for a period of at least 90 days “pending review.” He also mandated the creation of a list of “high risk” countries which require immigration restrictions—likely a similar list to the countries subject to Trump’s first term “Muslim ban”—and ordered the creation of a list of every immigrant who has arrived legally from those countries during the Biden years in order to “review” and potentially revoke their legal status. He has suspended access to asylum claims. He has also attempted the blatantly unconstitutional move of removing citizenship rights for people born on U.S. soil whose parents are not U.S. citizens.
There are a lot of implications for Canada in all this. The number of refugee claimants seeking asylum in Canada will likely increase, as it did during Trump’s first term. During those years, many migrants arrived to Canada via irregular crossings such as Roxham Road, which provided a legal avenue for irregular crossings to access asylum claims. That route has since been closed due to a 2023 deal between the Trudeau and Biden administrations. That closure will likely push migrants into more dangerous routes for irregular crossings, as has been the case for migrants trying to cross the desert into the United States or the Mediterranean into Europe.
While Trump’s endgame with Canada is unclear, he has hinted on a number of occasions that his tariff and annexation threats are related to concerns around the U.S.-Canada border and the cross-border drug trade. It seems likely that he has a vision for some sort of new border agreement with Canada. Could it be one that would cede “complete operational control” to the U.S., as Trump has outlined in his executive orders?
The nature of such an agreement is, at this point, speculation, as Trump has preferred belligerent threats without clear demands as a negotiating strategy, in the hopes that Canada will respond by showing its belly and offering up whatever he wants in return. Some Canadian politicians, such as Alberta Premiere Danielle Smith, prefer this strategy of capitulation.
The United States views its borders as worldwide, not simply around the territorial boundaries of the United States. It finances border enforcement in countries around the world in order to shut down migration routes that end in the United States. From the Darien Gap that separates Colombia and Panama, to the railroads that cross central America—anywhere that there are migrants, there is the U.S. border. Canada should understand U.S. migration policy accordingly.
Energy and climate change
For years, Trump has been an outspoken critic of environmental action and a cheerleader for the fossil fuel industry, so his opening salvo of anti-climate executive orders came as little surprise.
Together, the half dozen orders deliver a one-two punch intended both to expand domestic oil and gas extraction and reverse course on the transition to a cleaner economy. Specific policy directives include:
- Opening or reopening federal lands and waters to oil, gas and mineral extraction, especially previously protected areas in Alaska and the oceans surrounding the U.S.
- Triggering a review of all regulations that may impede new fossil fuel development.
- Withdrawing the U.S. from the Paris climate agreement—for a second time.
- Blocking all new offshore wind power development.
- Eliminating consumer incentives and regulations that encourage the adoption of electric vehicles (EVs) and energy-efficient home appliances.
- Rolling back environmental justice commitments.
These measures are tied together by the unprecedented declaration of a “national energy emergency.” Although there is no evidence that the U.S. is, in fact, in any kind of energy emergency—the country is producing more energy than ever before even as consumption is falling—the order gives federal agencies permission to bypass or expedite consultations and other legal obligations that might otherwise slow down Trump’s agenda. Any “actions to facilitate the Nation’s energy supply” will be fast-tracked in the coming months.
The implications for climate action in the U.S. and around the world are grim. Fossil fuels, such as coal, oil and gas, are the primary drivers of climate change. Producing more of them while hindering alternatives, such as wind power and electric vehicles, will undermine domestic and global efforts to decarbonize. Sinking more investment into the fossil fuel sector will also lock in infrastructure that future, more environmentally-minded administrations will have a hard time undoing.
For Canada, U.S. backpedaling on the clean economy hurts our own decarbonization efforts, especially in industries such as auto manufacturing and steel production that are highly integrated and/or exposed to the U.S. market. Major federal investments in battery facilities, for example, are predicated on a concerted North American EV transition. The economic case for those projects, at least in the short term, just got a lot weaker.
Nevertheless, there are some potential silver linings in Trump’s renunciation of climate leadership.
First, the U.S. has often played an obstructionist role in international climate negotiations. Without them at the UNFCCC table, it’s possible that the non-U.S. international community will be able to act with greater concerted climate ambition. Future, more progressive U.S. administrations would then be forced into a position to accede without having had a seat at the negotiating table.
Second, green investors in the U.S. may be looking abroad for new investment opportunities as Trump works to obstruct and shut down renewable energy projects. Canada could be an attractive alternative, as long as the energy transition remains a political priority here. If the Canadian dollar falls, which is almost inevitable as Trump’s tariffs start to bite, Canada becomes an even more attractive investment destination.
Third, and most importantly, Trump’s “drill, baby, drill” agenda may deal irreversible damage to the Canadian oil sands. While Trump may try to increase U.S. fossil fuel supply, he has much less control over falling global demand. The likely outcome is falling oil prices. When paired with a 25 per cent tariff on Canadian oil exports to the U.S. (see below), much of the oil sands becomes non-viable very quickly. It would be economically devastating, but also create the conditions for a meaningful transition away from Canada’s most polluting industry.
These scenarios are hardly guaranteed. The rightward political shift underway in many countries around the world, including in Canada, puts these opportunities at risk. But, for now at least, the door is open.
Trump’s trade memorandum and Canada’s economic future
Multiple sources, including the Republican Party platform and Trump-linked think-tanks, had called for an “America First Economic Policy” that includes the rebalancing of U.S. trade through use of import tariffs and the negotiation or renegotiation of U.S. trade deals. The initial stages of Trump’s version of this plan are outlined in a memorandum from the president to a number of secretaries and department leads who have yet to be confirmed.
When it was released, the memorandum elicited sighs of relief in Canada, as neither it nor Trump’s inaugural address mentioned tariffs on Canadian and Mexican exports to the U.S. The relief was short-lived, as Trump muttered something Monday evening, repeated again Tuesday, about those tariffs going up February 1. “We’re thinking in terms of 25 per cent,” he said.
Trump’s goal—now as in his late-November Truth Social post—seems to be to coerce Canada and Mexico into agreeing to some kind of border or trade policy related to fentanyl and migration. The president announced he would impose a 10 per cent tariff on Chinese imports, also related to fentanyl trade, on February 1.
The immensity of this undiplomatic (to put it mildly) threat hanging over Canada, and the question of how best to respond, will preoccupy federal and provincial governments for the next week and possibly beyond. But other parts of Trump’s trade agenda outlined in Monday’s memorandum—like the renegotiation of the Canada-U.S.-Mexico Agreement, or CUSMA—will also require careful attention.
In fact, the Wall Street Journal reports this week that the 25 per cent tariff may also be a way to pressure Mexico and Canada into an early review of the agreement. “Trump is particularly focused on using the threat of tariffs to change automotive rules under the continental trade pact, forcing car plants to move from Canada and Mexico back to the U.S., according to people familiar with his thinking,” reports the paper.
Some of the other Trump trade memorandum actions affecting Canada include the following:
- The secretaries of commerce (Howard Lutnick), treasury (Scott Bessent) and the United States Trade Representative (Jamieson Greer) are asked to investigate the country’s persistent trade deficits and recommend, by April 30, “appropriate measures, such as a global supplemental tariff or other policies, to remedy such deficits.” Should these Trump appointees agree on a global tariff, it’s possible Canadian exports would be caught by it.
- Review and identify unfair trade practices and recommend unilateral actions—in U.S. law—for retaliating.
- Commence public consultations ahead of the mandated 2026 review of CUSMA, as required by the U.S. implementing legislation for the North American trade deal. This step must be taken before the U.S. can engage Mexico and Canada on the review, which Trump has promised to turn into a full renegotiation.
- Investigate whether any foreign country “subjects United States citizens or corporations to discriminatory or extraterritorial taxes pursuant to section 891 of title 26, United States Code.” This relates to a separate executive order withdrawing U.S. support for OECD discussions on a fair global taxation regime for multinationals. Trump is promising to retaliate against countries that try to fairly tax U.S. digital giants like Google, Amazon, Meta, etc. These moves put Canada’s digital services tax squarely in Trump’s sights.
- Conduct a further national security review of the U.S. industrial and manufacturing base to determine if further trade actions should be taken against imports. Trump also wants to review any exemptions that have been made to past countervailing duties (import surtaxes) on steel and aluminum, like the kind granted to Canada and Mexico in 2019 at the close of the CUSMA negotiations.
- The secretaries of state and commerce are asked to assess and make recommendations for how to ensure foreign states comply with existing and future U.S. restrictions on transfers of strategic goods and technologies to “strategic rivals,” namely China. These policies already restrict Canada’s ability to expand markets for Canadian firms in Asia, or draw investment to Canada from Asian firms, and will further tie Canada to Trump’s geopolitical agenda.
- The secretaries of commerce and homeland security “shall assess the unlawful migration and fentanyl flows from Canada, Mexico, the [People’s Republic of China], and any other relevant jurisdictions and recommend appropriate trade and national security measures to resolve that emergency.” The report in this matter is due to the president by April 30 of this year.
- Trump’s decision to end America’s electric vehicle “mandate” and “immediately pause the disbursement of funds appropriated through the Inflation Reduction Act of 2022,” while not in the trade memorandum, will affect Canadian trade in automotive goods if it lowers demand for EVs. Canadian plants retooling to produce electric vehicles are threatened by the move, raising questions about Canada’s options for effectively maintaining the inevitable transition away from gas-powered vehicles (see above).
Some of this is routine for the USTR. For example, the U.S. releases an annual list of foreign trade barriers in all countries. Where gripes do not obviously violate a U.S. trade deal or World Trade Organization rules, diplomacy or coercion are the American way. However, the normalization of tariffs as bargaining leverage (over the Canadian border or to force agreements on other countries regarding U.S. currency devaluation) and income source for the U.S. government, as Bessent told Congress last week, is new.
So we have a possible scenario where Trump turns the screws on Canada with an import tax, retaliatory taxes on Canadian firms in the U.S. related to the digital services tax, and some kind of militarized border with the potential to affect the flow of people and goods. This is on top of the uncertainty of facing a 25 per cent tariff on all Canadian exports to the U.S. as early as February 1 or perhaps later, in response to the results of the fentanyl and migration review mentioned above.
This should be a major wake up call to Canada. A rapid agreement between Trump, Mexico, Canada and possibly China, related to fentanyl imports, could potentially stave off tariffs if in fact that is what Trump’s threat is meant to achieve. Unfortunately, we don’t know that yet. It’s quite possible Trump is aiming for something larger related to the CUSMA renegotiation—or even that these demands are a facade to cover plans to reshore Canadian and Mexican manufacturing, mining and other activities back to the U.S. homeland.
If that’s the case, and Trump doesn’t want what Canada is selling, we need to find ways to sell it elsewhere or use it ourselves. Even if Trump’s ultimate demands are more limited, it would be prudent to radically re-assess our place in North America. Appeasement for the purposes of more closely integrating the Canadian and U.S. economies, which business lobby groups are calling for, is a lost cause.
Instead, we should be thinking more about upgrading natural resources in Canada, strategic government procurement of Canadian-made products, more east-west flows of electricity, energy, goods and services. We should also be trading more with countries who want to buy our stuff and who will be just as annoyed at dealing with Trump’s economic bullying as we are.
The power (and limits) of executive orders
Presidential executive orders are a powerful tool that allow an administration to move quickly on certain policy priorities by sidestepping Congress and other, more democratic forms of policy making. However, in most cases, a president is not above the law.
Many of Trump’s executive orders will be challenged in the courts. His assertion that the U.S. will strip natural-born Americans of their citizenship, for example, is blatantly unconstitutional and unlikely to survive legal challenges. Other executive orders will be stayed, modified or repealed, as they were during Trump’s first term, slowing down the implementation of his agenda. And Trump’s trade policies, to the extent that they violate existing trade agreements and international law, will be fought by other countries.
Nevertheless, the damage is done. Even where Trump cannot immediately execute on his priorities, his administration will find other ways to proceed, especially if Congress lines up behind him. As the shock and awe of Day One fades, Canada must be prepared for the next four years of unpredictable, vindictive and destabilizing American policy.