‘It’s about stopping the stupid’: Jim Balsillie says Canada came ‘sleepwalking’ into Trump tariff crisis
Former chairman and CEO of Research In Motion Jim Balsillie, known for creating the BlackBerry, says Canada’s relative economic vulnerability amid a potential trade war with the U.S. is 'an issue of our own making,' adding that while 'they come prepared,' 'we come sleepwalking.'
Former chairman and CEO of Research In Motion Jim Balsillie — known for creating the BlackBerry — says Canada’s relative economic vulnerability amid a potential trade war with the U.S. is “an issue of our own making,” adding that while “they come prepared,” “we come sleepwalking.”
“We’re in a vulnerability,” Balsillie said in an interview with CTV Question Period airing Sunday. “No other nation state allowed themselves to become this vulnerable in so many critical aspects of their prosperity and security, and so these are self-inflicted wounds.”
U.S. president-elect Donald Trump will be inaugurated on Monday and has threatened to impose blanket 25 per cent tariffs on all Canadian imports as one of his first of “many” executive orders, as soon as he’s back in the White House.
Trump initially used the flow of illegal migrants and drugs over the border as reason for imposing tariffs, but he has since shifted emphasis rhetorically to praising the use of tariffs — as he sees it —on their own merit, and as a way to address the U.S. trade deficit with Canada.
Speaking to host Vassy Kapelos, Balsillie argued that Canada has been slow to foster resiliency within its borders, as the nature of the economy has changed over the past decades.
“It’s not a trading economy, and so the key is to build resilience in value chains and security as a nation, because there isn’t the same kind of economic allies of the post-World War Two trading system,” Balsillie said. “So, the game changed 30 years ago. All other successful countries changed their strategies, and Canada doubled down on old strategies and put us in this place.”
Canada’s economy has faced a productivity challenge for years, with the Organisation for Economic Co-operation and Development (OECD) predicting Canada’s per capita GDP growth will rank last among OECD economies over the next 40 years. Canada’s overall 1.8 per cent decrease in labour productivity in 2023 was also the worst in the OECD.
Balsillie insists the signs were there, pointing to signals during Trump’s first term in office in which the president’s former adviser and son-in-law Jared Kushner lauded the “sunset provision” in the trilateral trade agreement — the Canada-United States-Mexico Agreement (CUSMA) — which allows the deal to be reviewed every six years. The agreement also has a 16-year lifecycle.
In a 2020 op-ed, Kushner wrote that it was “imperative” the U.S. “retain leverage in any of (its) trading relationships to prevent unfair trade practices and market distortions.”
Balsillie said Canada should have heeded that signal.
“Very simply, for 30 years, Canada has been using outdated thinking in its economic and security strategies, and this is what’s caused the erosion of our prosperity and security,” Balsillie said. “What Donald Trump has done is laid bare the inattention by our economic policy community in that time.”
“What’s particularly unacceptable is his adviser, Jared Kushner, warned us what (Trump) was doing, that he sees (Canada) as a tenant,” he added. “He’s a landlord. He’s going to come back and raise the rents and in six years, and here we are.”
The United States is Canada’s largest trading partner, with the annual trade relationship between the two countries accounting for $1.3 trillion. Canada is also the largest export market for 36 states.
Given those ties, economic experts say a 25 per cent tariff could have severe consequences to the Canadian economy and cost millions of jobs. According to the Canadian Chamber of Commerce, Canada’s gross domestic product could shrink by 2.6 per cent and Canadian households could lose an average of $1,900 annually.
Asked how Canada can become less dependent on the U.S. economy, Balsillie said, “It’s partly dependence, but it’s partly a responsibility.”
“A responsible nation would have built a house of bricks, and we built a house of sticks,” Balsillie said. “The big bad wolf has shown up, and everybody’s running around freelancing, saying, ‘What do we do now’?”
Balsillie added that Canada needs “new voices,” and that building a successful policy around resiliency is “about stopping the stupid.”
“We have to move beyond palace intrigue of the politics and start to have proper economic discourse,” he said. “Or sadly, the erosion is going to continue.”
“It’s very fixable,” he said.
Balsillie is part of a group called the Council of Canadian Innovators, which just launched the Canadian SHIELD Institute, with the aim of fostering homegrown innovation that will have a long-term impact on the country. He donated $10 million to get the project started.
“There are many, many things that need to be done and should have been done a long time ago,” Balsillie said. “But the old saying, ‘The best time to plant a tree is 20 years ago, the second-best time is now,’ I’ve met so many bright young scholars who want to build a better country. I’m betting on them.”
