In the opening salvo of a trade war that threatens to dismantle Canada’s most sacred economic protections, the United States has issued a blunt ultimatum: open your markets or risk the collapse of North American free trade.
U.S. Trade Representative Jamieson Greer laid out a sweeping list of demands before Congress, targeting the pillars of Canadian economic sovereignty—its supply-managed dairy farms, its cultural protection laws, and even its provincial liquor bans—as the price for extending the critical USMCA trade pact. The move escalates a simmering conflict into a full-scale confrontation over who sets the rules on the continent.
The Target List: Dairy, Netflix, and Booze
The American demands are a direct assault on policies Canada has defended for generations:
1. Dairy Sovereignty: The U.S. demands that Canada further dismantle its supply-management system, which strictly controls production and imports to support local farmers. President Trump has repeatedly threatened a 35% blanket tariff, accusing Canada of “extraordinary tariffs… up to 400 per cent.” While Canada is a top importer of U.S. dairy ($1.1 billion in 2024), Washington argues the system is fundamentally unfair and must be “bolstered.”
2. The “Netflix Tax” and Cultural Laws: The U.S. is demanding a revision of Canada’s Online Streaming Act, which requires American giants like Netflix and Spotify to pay to support Canadian content. Greer labeled the Trudeau-era law discriminatory. Also in the crosshairs is the Online News Act, which prompted Meta to block news for Canadian users on Facebook and Instagram.
3. Provincial Liquor Boycotts: In retaliation for Trump’s sweeping tariffs, most Canadian provinces removed U.S. alcohol from their shelves—a move that has hammered American producers. Greer stated plainly that U.S. liquor must return to Canadian shelves for the USMCA to continue. Ontario Premier Doug Ford has vowed to keep the boycott until a deal is reached.
A Pact Hanging by a Thread
Greer framed the USMCA as only “successful to a certain degree,” warning that “changes must be made for it to continue.” While Canada and Mexico want the pact extended, Trump has publicly mused about leaving it, using the 2026 review as leverage to force a wholesale renegotiation on his terms.
The demands go beyond the headline issues. Greer also cited “discriminatory” provincial procurement rules, “complicated customs” hurdles, and an obscure but bitter dispute over Montana’s access to Alberta’s electricity market, which the U.S. claims is unfairly blocked.
Why This Is More Than a Trade Spat
This is a battle over two competing visions: American market access versus Canadian cultural and economic protectionism. Canada has historically viewed its dairy farms and cultural industries as non-negotiable pillars of national identity. The U.S. now sees them as unfair trade barriers to be demolished.
The liquor boycott, which started with Jack Daniel’s, was a symbolic shot across the bow. The new U.S. demands are the full broadside. For Canada, the choice is stark: surrender key protections to save the trade deal that underpins its economy, or dig in for a fight that could see the U.S. walk away, triggering an economic crisis. The polite neighborly relationship is over; a brutal negotiation for the future of North America has begun.
