[This article by Prof. Rodrigue Tremblay was first published by Global Research. You can read it here.] “Democracy and plutocracy are the same thing.… He who pays the piper calls the tune.” —Oswald Spengler (1880-1936), German historian, philosopher and political writer, author of ‘The Decline of the West’, 1918). “When the government runs a budget deficit, it pumps more money into the pocketbooks of people than it withdraws from their pocketbooks — the demand for goods and services therefore tends to increase all around. That is why inflation has been raging since the mid-1960s.” —Arthur F. Burns (1904-1987), American economist and Federal Reserve Chairman (1970-1978), in a speech, on Sunday September 30, 1979. “All financial crises involve debts that, in one way or another, become dangerously out of sync with available means of payment.” —John K. Galbraith (1908-2006), American economist, born in Canada, 1994. “The new world economic order will be built from Europe. Canada is the most European of non-European countries, and we are transforming our cooperation with the European Union (EU).” —Mark Carney (1965- ), Canadian Prime Minister, an economist and a central banker, (during a speech in Dublin Ireland, on Saturday June 12, 2026). * Donald Trump’s one-man administration is launching improvised wars of aggression abroad and trade wars against other countries, thus creating stagflation, i.e. a situation of rising prices, slow economic growth and lower employment. (And this, after D. Trump himself had promised to end ruinous American wars abroad!) Wars are usually a source of inflation and a decline of purchasing power for most people, except for the minority who profit from them, as it is the case with the military industrial complex and stock market speculators. Besides being immoral when they kill men, women and children and destroy countries, military wars of aggression abroad are costly. That was one of the reasons why governments imposed general food rationing and price and wage controls, on people of countries engaged in World War II (1939-1945). Trade Wars Are Disruptive to All EconomiesDonald Trump has not only de facto privatized the U.S. government. He also behaves and acts as if he had bought the White House and considers it his private property. Also, he has weaponized U.S. trade with neighboring countries to his own domestic political advantage. Indeed, the D. Trump administration 2.0 has used trade policies and financial sanctions against other countries to achieve an obscure mixture of political, economic and noneconomic objectives. As a self-centered political demagogue, D. Trump seems to want to project an image of ‘winner’ against other countries to his domestic political base. It is difficult to determine when politics takes precedence over economics, or when the reverse is true. For instance, on Friday March 2, 2018, one day after having announced sweeping tariffs on imports from some countries, Donald Trump said that “trade wars are good, and easy to win”! In fact, according to most economists, such trade wars are disruptive to the launching country as well as to the targeted countries. Trump’s Gratuitous Insults and Disruptive Trade Taxes on Imports From CanadaCanada is the second largest country in the world in territory, and it has large natural resources in various minerals, oil and gas, and strong financial and manufacturing sectors. Canada supplies 99 percent of American natural‑gas imports, 87 percent of potash imports, 85 percent of its electricity imports, 75 percent of primary aluminum imports, and 60 percent of its crude‑oil imports. Canada is also an important source of critical minerals to the United States, such as uranium, nickel, rare earth elements, cobalt, iron, copper, etc. In addition, Canada holds 20 percent of the world’s freshwater reserves. Canada is a sovereign country that plays an important international role within the United Nations, as one of its founding countries and one of the main participants in its peace missions. It is a founding member of NATO, a member of NORAD, and is a member of the British Commonwealth. It is no surprise that trade in goods and services between the two neighboring countries, Canada and the Unites States, has traditionally been very important. Nevertheless, politician D. Trump keeps repeating the BIG lie that “the U.S. does not need Canada”! In 2025, for instance, the United States exported $333.62 billion USD of merchandise to Canada while Canada exported $381.92 billion USD of goods to the U. S., mainly because of large U.S. imports of electricity and crude oil through pipelines from Canada, resulting in a net U. S. trade goods Canadian surplus of $48.30 billion USD. However, the net trade in services between the two economies is the reverse, since Canada imports yearly more financial, commercial, transport, entertainment and travel services from the United States than it exports. For the total balance of payments of goods and services, between the United States and Canada in 2025, according to the US Congressional Research Service, the net total U.S. deficit was only $25 billion US, because Canada had a net $23.3 billion service deficit with the United States. That is why the imbalance in the total balance of payments of trade in goods and services between Canada and the United States is much smaller than the D. Trump administration 2.0 wants us to believe. [N. B.: It is not explicitly clear if US data take into consideration the yearly net profits that US companies in Canada (Walmart, Costco, Alcoa, GMC, Ford, Exxon, etc.) send to the United States. If not, there could be no overall goods and services Canadian trade surplus between both countries.] It would appear that D. Trump is exploiting the Canada-U.S. trade relationship for three reasons:
On Friday August 21, 2026, D. Trump used the pretext of an old 1930 law to unilaterally impose a 50% import tax on hundreds of Canadian goods—probably illegally— ranging from wine and hockey sticks to cement, electronics, and dairy products. Such a reckless move has launched a trade war between the two neighboring countries, with untold economic and political consequences. The Wall Street Journal has qualified D. Trump’ trade wars against Canada “the dumbest” that could be, because they “make no economic or political sense.” Trump’s Incompetent Public ManagementMoreover, the United States, (and a few other advanced economies), also find themselves in a situation of public over-indebtedness, and are on the verge of a debt spiral and a debt trap. In particular, the budget deficits and public debt levels of the Trump administration 2.0 continue to grow. As a result, annual U.S. total output is lower than overall spending, and the gap stems primarily from the enormous annual U.S. government budget deficit, which is approximately $1.7 trillion. U.S. public debt has now reached $40 trillion and it represents 122.35 percent of the gross domestic product (GDP), which is $32.634 trillion. Such fiscal instability translates into domestic inflationary pressure and rising interest rates, as well as external trade deficits when the Treasury borrows abroad and strengthens the U.S. dollar on the foreign exchange market. However, President Trump and his entourage seem unable to grasp that their country is living beyond its means and is spending recklessly abroad, maintaining hundreds of military bases in other countries and launching costly wars of choice abroad, which inflates its federal fiscal deficit and its external trade deficit, partly financed by selling U.S. dollar-denominated bonds to other countries. Foreign central banks are increasingly reluctant to buy U.S. dollar-denominated Treasury bonds. In reality, that system, which has allowed the U.S. military state to easily finance enormous spending abroad, without dire consequences, is nearing its end. Not only the U.S. dollar became officially a fiat dollar, on August 15, 1971, but the international monetary system based on that fiat dollar is declining. The rise to power of a politician as unprepared as Donald Trump is unprecedented in 250 years of American political history, and this is accelerating the international demise of the U.S. currency. In fact, Donald Trump has single-handedly wrecked the rules-based international economic order, an 80-year-old system of international economic cooperation. He is even preparing to repeat the mistakes of the 1930s, under the presidency of Herbert Hoover, by imposing high import taxes. Indeed, the Smoot-Hawley Act, of June 17, 1930, placed 20 percent duties on imports from foreign countries, thus helping to transform an economic recession into a worldwide economic depression. Income and Wealth Disparities in the United States Are Higher Than in Almost Any Other Developed EconomiesIndeed, income and wealth disparities in the United States have risen over the last 60 years, and especially since 1971, when the U.S. fiat dollar began losing purchasing power and inflation gained ground. Americans living on monetary incomes or on monetary pension savings and renting their lodging, lost the most in real terms. According to the American Urban Institute’s calculations, persistent inflation and government policies greatly favored owners of stock market shares and real estate. The result has been a massive transfer of wealth from the American middle class and the poorest families to the wealthiest families. For Instance, in 1963, the wealthiest American families owned 36 times the wealth of the average American families. By 2022, however, wealth inequality had nearly doubled, and they owned 71 times the wealth of middleclass families. The advent of Artificial Intelligence (AI) and stock market bubbles are bound to intensify such disparities and to worsen the so-called K-shaped American economy. This has gotten worse under the dictatorial Trumpian regime. Many American families have seen their standards of living decline, with a persistent high inflation level, declining employment and a drop in the purchasing power of their monetary incomes and savings, except for Trump’s very rich allies who have benefited from lower taxes and financial schemes. D. Trump even boasted publicly: “I love the inflation“, even though inflation favors stock market speculators and the minority who own capital, but lowers the standards of living of most other Americans. This is a most unhealthy economic and social situation. ConclusionsSince January 20, 2025, politician Donald Trump has developed a reputation as a corrupt grifter-in-chief and as an agent of chaos and destruction, domestically and internationally. He has launched numerous wars of aggression, aggressive trade wars against allied nations, inhuman ICE caged prisons at home and abroad, etc. D. Trump is flying blindfolded and he relies on the words he heard from the last person he talked to! In fact, the Trump administration 2.0 will be remembered as being autocratic, impulsive, lacking in general professional knowledge and competence, and for a high level of corruption, not to mention Trump’s own criminal record. By now, most thinking people should have deciphered why D. Trump is such an agent of chaos and conflicts. This is related to his complex mental viewsabout interpersonal relations and international relations: in his mind, there must be an ‘absolute winner’ and an ‘absolute loser’ in all human relationships. —There is hardly any place for mutually beneficial relations or for profitable ‘win-win’ cooperation and exchanges. That maybe why, with such a frame of mind, Trump’s violent and predatory tactics in any contractual negotiation are to insult, threaten, punish, sanction and bully the other side, individuals or countries, in order to extract the maximum immediate benefits for himself and for his family, or resources for his country. However, such a self-centered attitude could dangerously backfire and lead to isolationism and negative consequences. Indeed, most ordinary people dislike to be governed by a vile bully, while other countries leaders do not trust a warmonger who does not respect international law or any alliance. The chaos and destruction the D. Trump administration has imposed on the United States is a consequence of his violent approach to international relations. Indeed, his improvised and imperialist wars to threaten, intimidate and to steal other countries territory and oil by force, have brought the 80-year-old international political, economic and trade system to the brink of collapse. So far, the main victims have been Venezuelaand Cuba, and their citizens. Consequently, the United States’ reputation for honesty and morality among the nations of the world is plummeting and has reached its lowest point. It will take years, perhaps decades, to rebuild an international political and economic system based on political cooperation and economic dynamism. For the sake of humanity and world peace, it is to be hoped that such a moral and civilizational regression will not be permanent and that more enlightened leaders will rise up to repair the damage. *** International economist Dr. Rodrigue Tremblay is the author of the book about morals “The code for Global Ethics, Ten Humanist Principles” of the book about geopolitics “The New American Empire“, and the recent book, in French, “La régression tranquille du Québec, 1980-2018“. He was Minister of Trade and Industry (1976-79) in Quebec’s Lévesque government. He holds a Ph.D. in international finance from Stanford University. Please visit Dr Tremblay’s site or email to a friend here. He is a Research Associate of the Centre for Research on Globalization (CRG) |
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