It appears that the tariff war launched by Donald Trump is about to get much bigger, possibly sparking a major global economic slump. In a socialist world, a reduction in certain types of economic activity, coupled with a “green jobs” plan, a shorter work week with no cut in pay, and improvements in social programs, could be a planned, rational response to the environmental impact of unchecked carbon emissions. But in today’s capitalist world, where the pursuit of maximum private profit is the key factor, any fall in growth rates spells disaster for billions of working people.
Economists are warning that the tariffs on steel, aluminum and autos mean higher prices for US consumers, leading to interest rate increases which could push the North American economy towards recession. This situation is not caused by one erratic US President; it reflects the shifting realities of the global economy. As the US weakens in relation to other major capitalist powers and China, the US ruling class hopes to impose its own unilateral demands to restore its former dominance.
Capitalism is a system which cannot avoid recessions and depressions. But this particular crisis demonstrates the danger of over-reliance on one single market. The tactic of the Canadian ruling class – sycophantic support for US imperialist foreign policy – will never protect this country from suffering the impact of economic turmoil south of the border, or from the actions of politicians in Washington. Instead of bowing to Trump’s demands for huge concessions on NAFTA, Canada should shift to a People’s Alternative economic strategy based on the needs of working people and the environment. Making such a change calls for the election of a government with the strength and wisdom to chart a new course for the 21st century; that will be a prominent issue leading up to the October 2019 federal election.