Two Weeks to Build Something That Lasts

Trade talks between Canada and the United States broke down Friday night. By Saturday morning a 50 per cent tariff was in force on billions of dollars of Canadian goods. Canada’s response was announced today.

This timeline gives both sides two weeks to get back to the table. I hope they use the time well, and that they aim at something more durable than a lower rate.

I run a few SME businesses. Whatever the tariff rate turns out to be, we will find a way to work inside it. That is what business owners do. We reprice, we resource, we adjust. What we can’t work inside is not knowing.

Every serious decision an owner makes is a bet on a future we can’t see, and each one assumes the rules will look roughly the same when the loan comes due as they did the day it was signed. Take that assumption away and the decision doesn’t disappear. It shrinks. The five-year lease becomes two. The twelve hires become four contract positions. The equipment purchase waits until next year, and then the year after that.

One owner deferring a purchase is a private decision. A few hundred thousand owners making that call in the same year is an economy. The Bank of Canada has been blunt: business investment is weak across sectors, largely because of uncertainty. And it is not recovered later. The plant that does not get built this year does not get built twice next year.

There is a second cost that isn’t getting much attention. Business investment is where public revenue begins, so when investment slows, corporate tax, income tax and sales tax all thin out at once, just as governments are funding support programs out of a shrinking tax base.

Large corporations are not insulated either. Uncertainty puts them into protection mode too, and they protect themselves at scale: hiring freezes, cancelled capital programs, mass layoffs that are also devastating to families. What they do have is options. They hedge, hold inventory, and shift production between plants. Small and medium businesses have none of that. They are quoting work this week at prices they cannot stand behind, and they can’t restructure a supply chain in 14 days.

The issue is not confined to one side of the border. A small manufacturer in Alberta and a small distributor in Ohio are each other’s customers, each other’s suppliers, and now, because of decisions out of their control, each other’s collateral damage.

Entrepreneurs put our own capital at risk. We create jobs, pay taxes and carry the loss when it goes wrong. We are asking for one thing in return. Solid ground under our feet.

So, to both governments: negotiate hard, and in good faith for your own country and your own people. That is the job, and we want you to do it well.

Then come to an agreement. Not a truce, and not a number that buys a news cycle. An agreement solid enough that a business owner in Calgary or Cleveland can look at it and decide to build.

Two weeks. Let’s get back to business.