David Frum, in a recent piece for The Atlantic, points out an important and under-reported consequence of the huge tariffs the Trump government is putting on goods from around the world. Canada does have tariffs on incoming goods, but they are much smaller than Trump’s tariffs. As Frum points out, that has two inevitable results: (1) most things coming from other countries (especially China) will be far cheaper in Canada than they are here, and (2) there will be massive smuggling of goods from Canada to the US.
As Frum says, no other country will want to help the US enforce its draconian tariffs. Why would they, when the US will not honor the trade agreements Trump signed five years ago? And the US has far too few border agents to control smuggling on the scale that will be unleased.
Soon there will be lots of bargains available on the internet and in grey-market budget stores near the border, Frum expects. That’s where a lot of consumers will look for their TVs, toys, furniture, coffee, and more.
Is it about time for new tires for your car? Why not plan a Canadian trip and buy them there for 30% less than you would pay here. How guilty would you feel if you didn’t declare your new tires at the border on the way home? (By that time, they would no longer really be new anyway, so I guess you if you wanted to, you could declare them at a steeply depreciated value.)
Frum envisions that Canadian border towns will experience an economic rebirth, as US shoppers flock there for bargains. That will help cushion the effects that the tariffs are having on Canadian industries such as car parts and forest products.
My conclusion: While it’s clear that Trump’s tariffs will hurt most of us financially, there is one group that will certainly profit: smugglers.

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