Trump suspends trade talks with Canada over Ronald Reagan ad

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(The Center Square) – President Donald Trump suspended all trade talks with America's largest trading partner over an ad that features former President Ronald Reagan speaking about tariffs in 1987.

Trump suspended talks late Thursday after the Ontario government spent about $75 million Canadian ads featuring audio and video of Reagan to air on American TV stations. 

In the remarks at issue, Reagan said he was "loath" to put up any barriers to free trade, but did so in response to Japan's trade decisions on semiconductors.

"But, over the long run, such trade barriers hurt every American worker and consumer," Reagan says in the address.

The Ronald Reagan Foundation said Ontario took the former GOP president's remarks out of context.

"The ad misrepresents the Presidential Radio Address, and the Government of Ontario did not seek nor receive permission to use and edit the remarks," the foundation wrote in a post on X.

The foundation said it was "reviewing its legal options in this matter" and encouraged all interested to watch Reagan's unedited video on its YouTube channel.

Trump said Reagan, whose portrait hangs in Trump's Oval Office, loved tariffs. 

"CANADA CHEATED AND GOT CAUGHT!!!," Trump wrote on Friday morning on his social media platform. "They fraudulently took a big buy ad saying that Ronald Reagan did not like Tariffs, when actually he LOVED TARIFFS FOR OUR COUNTRY, AND ITS NATIONAL SECURITY."

Trump accused Canada of trying to "illegally influence" the upcoming U.S. Supreme Court case challenging his tariff authority.

"Canada is trying to illegally influence the United States Supreme Court in one of the most important rulings in the history of our Country," Trump said Friday in his post.

Trump's economic agenda is tied to tariffs. However, a group of small businesses, some Democrat-led states, and two toymakers have challenged the president's tariff authority under the International Emergency Economic Powers Act of 1977. That law doesn't mention tariffs. The case is pending before the U.S. Supreme Court, which has set oral arguments for Nov. 5.

Late Thursday, Trump said he would suspend all talks with Canada over the ad campaign.

"The Ronald Reagan Foundation has just announced that Canada has fraudulently used an advertisement, which is FAKE, featuring Ronald Reagan speaking negatively about Tariffs. The ad was for $75,000,000," Trump wrote on Truth Social. "They only did this to interfere with the decision of the U.S. Supreme Court, and other courts. TARIFFS ARE VERY IMPORTANT TO THE NATIONAL SECURITY, AND ECONOMY, OF THE U.S.A. Based on their egregious behavior, ALL TRADE NEGOTIATIONS WITH CANADA ARE HEREBY TERMINATED."

Trump previously suspended trade talks with Canada in late June, but Canada caved to Trump's demands by pulling its digital services tax hours before it was to go into effect. Canada's proposed digital services tax required foreign and domestic businesses to pay taxes on some revenue earned from engaging with online users in Canada.

Jason Kenney, a former Conservative cabinet minister under former Prime Minister Stephen Harper, called Trump's comments and the response from the Ronald Reagan Foundation "embarrassing."

"The Ontario ad does not misrepresent President Reagan's anti-tariff radio address in any respect whatsoever. It is a direct replay of his radio address, formatted for a one-minute ad," Kenney wrote in a post on X. "Everything that Reagan said in his pro free trade April, 1987 radio message is consistent with the ad. In fact, everything he ever said about trade, before and after becoming President, is consistent with his principled opposition to tariffs."

He also called out the foundation for its comments.

"The @RonaldReagan Foundation knows these things. They know perfectly well that the Ontario ad captures precisely President Reagan's opposition to tariffs, and support for free trade," Kenney wrote. "But it is obvious that the Foundation now has gormless leadership which is easily intimidated by a call from the White House, yet another sign of the hugely corrosive influence of Trump on the American conservative movement. For shame."

In the video, Reagan said he opposes tariffs and protectionist trade policies, both of which Trump has employed extensively in his second term. Reagan said such policies only work for a short time in the video.

"You see, at first when someone says 'Let's impose tariffs on foreign imports,' it looks like they are doing the patriotic thing by protecting American products and jobs. And sometimes, for a short while, it works. But only for a short time," Reagan said. "What eventually occurs is first homegrown industries start relying on government protection in the form of high tariffs, they stop competing and stop making the innovative management and technological changes they need to succeed in world markets. And then, while all this is going on, something even worse occurs. High tariffs inevitably lead to retaliation by foreign countries and the triggering of fierce trade wars. The result is more and more tariffs, higher and higher trade barriers and less and less competition."

Reagan also said high tariffs "subsidize inefficiency and poor management."

In his second term, Trump used the 1977 law to reorder global trade through tariffs to give U.S. businesses an advantage at home. Using tariffs under the International Emergency Economic Powers Act, Trump put import duties of at least 10% on every nation that does business with the U.S. Some nations, including many U.S. allies, face much higher tariff rates.

Trump has also put tariffs on imported steel, copper and aluminium.

In August, the U.S. Court of Appeals for the Federal Circuit affirmed a previous lower court ruling saying Trump did not have the authority, but said Trump's tariffs could remain in place while the administration appeals to the U.S. Supreme Court.

In the 7-4 decision, the majority of the Federal Circuit said that tariff authority rests with Congress. It used that same language: "We discern no clear congressional authorization by IEEPA for tariffs of the magnitude of the Reciprocal Tariffs and Trafficking Tariffs. Reading the phrase 'regulate ... importation' to include imposing these tariffs is 'a wafer-thin reed on which to rest such sweeping power.'"

A Supreme Court victory for Trump would cement the federal government's newest revenue source in place, at least for now.

Trump has said the tariff case is so important that he might attend the hearing personally.

According to an analysis of federal data from the Penn Wharton Budget Model, the president's new tariffs raised $80.3 billion in revenue between January 2025 and July 2025 before accounting for income and payroll tax offsets.

The Congressional Budget Office estimated that Trump's tariffs could generate $4 trillion in revenue over the next decade, but they would raise consumer prices and reduce the purchasing power of U.S. families.

Trump has said he wants to use tariffs to restore manufacturing jobs lost to lower-wage countries in decades past, shift the tax burden away from U.S. families, and pay down the national debt.

A tariff is a tax on imported goods that the importer pays. The importer pays the cost of the duties directly to U.S. Customs and Border Protection, a federal agency.