Part of an ongoing series that looks at changes one year after the global trade wars ignited.
For the next few months or so, some of us here at the Financial Post will be filing dispatches from the trade wars, which arrived in Canada on the last day of May 2018, when Prime Minister Justin Trudeau returned U.S. President Donald Trump’s fire with a volley of retaliatory tariffs on imports worth about $17 billion.
Combined, these stories describe a loss of innocence.
Central bankers, executives, politicians, trade negotiators, and the rest of us have had to come to terms with a world that is very different from the one we had come to take for granted.
To get started, let’s go back to Whitby, Ont., circa 1970. The town’s population had grown to about 25,000, a 70-per-cent increase from a decade earlier. The Canadian automotive industry, based in nearby Oshawa is on its way, thanks in large part to a managed trade agreement with the United States that Prime Minister Lester Pearson signed in 1965. The Auto Pact guaranteed that a percentage of the cars and trucks sold in Canada will also be built in Canada. These were good times.
At the curling club, the guy who spun records on the weekends knew exactly how to get this crowd to put down its beer and get up on the dance floor. “Something familiar and mid-tempo,” he’d say decades later. Raindrops Keep Fallin’ On My Head was his killer track. “I’m never going to stop the rain by complaining. Because I’m free. Nothing’s worrying me.” It worked every time.
That guy was Stephen Poloz, who was confident that Canada’s economy had rediscovered a familiar, mid-tempo groove when he took over as Bank of Canada governor some four decades later.
The financial crisis and the Great Recession had upended everything, but fiscal stimulus and near-zero interest rates had kept domestic demand buoyant. Now, a few years clear of a near depression, there was reason to think things were getting back to normal.
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See Also:
(2) Japanese Canadians call on B.C. to go beyond mere apology for historic racism
(3) The cost of Notley and Trudeau
