Oy, Canada!

Does the fall of Justin Trudeau lead to the rise of the 51st State?

Trump and Poliviere celebrating Justin Trudeau’s departure

Nine years and innumerable embarrassing costumes later, Justin Trudeau has resigned as Canada’s Prime Minister. Skyrocketing inflation and a deteriorating social safety net left Trudeau with a dismal 22% approval rating as of December: January 2021 was the last time his approval rating reached 50%.

Between April 2020 and September 2024 Canadian housing prices rose more than 30%, while household disposable income increased just 2.3%. RBC Economics forecasts a 6.9% unemployment rate for December. And on December 19 the Globe & Mail announced that Canada was starting to look like a failed state. While Trudeau may be on his way out, Canada still faces some insurmountable problems.

So what happens next? Donald Trump has some suggestions.

Tariffs and Annexations

On November 29, Justin Trudeau flew to Mar-a-Lago for a meeting with President-elect Trump. Earlier Trump threatened to impose 25% tariffs on all Canadian and Mexican exports, citing the unchecked flow of fentanyl and illegal immigrants across our northern and southern borders.

Fox News reports that Trump castigated Trudeau for Canada’s $100+ billion US trade surplus. When Trudeau stated that tariffs would kill the Canadian economy, Trump allegedly accused Canada of “ripping off the US to the tune of $100 billion” and suggested Canada become our 51st state.

Trudeau laughed Trump’s suggestion off as a joke. But Trump refused to let go. In a December 8 Meet the Press interview Trump said:

We’re subsidizing Canada to the tune over $100 billion a year. We’re subsidizing Mexico for almost $300 billion. We shouldn’t be — why are we subsidizing these countries? If we’re going to subsidize them, let them become a state.

On December 10, he referred to Trudeau as “Governor of the Great State of Canada.” And on January 6, soon after Trudeau’s resignation, Trump posted on Truth Social:

Facts, Threats, and Petroleum

Between October 2023 and September 2024, Customs and Border Protection agents seized 11,600 pounds of illegal drugs and apprehended 198,929 people. This is around 4% of the drugs and 8.3% of the people caught crossing the Mexican border during that same time period.

Census Bureau foreign trade records report the January to October 2024 deficit at $50.49 billion, and Canada’s trade surplus with America shrunk in October to its lowest level of the year. The Bureau also reports that during that time China’s trade surplus with America was $245.427B, while Mexico’s was $141.856B.

Looking at those numbers, it’s hard to see Canada as any great threat to American business or American sovereignty. Yet Trump keeps talking about annexation and tariffs. Is this just more bluster, or is there a method to the madness?

In 2024 Canada exported over 4 million barrels of oil to the United States every day, making it our biggest supplier of oil. Our second largest supplier, Mexico, sent us over 730,000 barrels per day in 2023. Greenland, yet another country Trump has talked about annexing, has up to 34.1 billion barrels of untapped oil.

So why are we seeing this sudden interest in oil-producing countries?

In the 1970s we made a handshake deal with Saudi Arabia. The Saudis agreed to sell their oil exclusively in US dollars. In exchange, the US promised military protection and equipment. Other members of the Organization of Petroleum Exporting Companies (OPEC) soon followed suit.

These oil-producing companies soon found themselves with a surplus of US dollars that they invested in US treasury securities. This made it easier for the US Treasury to run deficits, and they did just that. It also propped up the dollar’s value, which allowed us to buy imports at a discount.

There was never an official “petrodollar” treaty, but this gentleman’s agreement shaped our spending habits for almost 50 years. Now, as the dollar’s dominance has weakened and BRICS is making noises about their own world currency, America stands on the brink of a precipice.

Instead of relying on fiat currency gained in their roles as world banker and global policeman, they must go back to the old-fashioned imperial method of plundering resources. And it is easier to gain access to your neighbor’s resources than to guard and maintain intercontinental trade routes.

The American Empire’s End

Out of these troubled times, our fifth objective -- a new world order — can emerge: a new era — freer from the threat of terror, stronger in the pursuit of justice, and more secure in the quest for peace. An era in which the nations of the world, East and West, North and South, can prosper and live in harmony.

George W. Bush, 11 September 1990

After World War II, the world was divided by an Iron Curtain. By 1989 that curtain fell; two years later the Soviet Union followed. America, now the sole superpower, settled down to dreams of prosperity and harmony. Then, 11 years after George H.W. Bush’s speech, we learned non-state actors would also play a role in our shiny new global bureaucracy.

The free world now faced a War on Terror led by an Axis of Evil. Originally Iran, Iraq, and North Korea, this League of Nogoodniks later expanded to include Libya, Syria, Cuba, China, and Russia. While we liberated Iraq in 2003 and Libya in 2011, we couldn’t eliminate those pesky non-state actors. From Benghazi to Boston and the Charlie Hebdo offices, angry folks kept making bloody political statements.

In his 1961 farewell address President Dwight D. Eisenhower warned:

In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist. We must never let the weight of this combination endanger our liberties or democratic processes.

Today the military-industrial complex is bigger and less accountable than ever. The F-35, the Osprey, and Littoral Combat Ships are just a few of many glaring and expensive military boondoggles. Meanwhile Iran, North Korea, China, and Russia all fired hypersonic missiles before the United States achieved its first successful launch.

America outsourced its manufacturing sector to the developing world. Europe outsourced its defense to America. In 2024 only 23 of NATO’s 32 members spent 2% of their GDP on defense as required by treaty. America spends 3.4% of its GDP — and 16.3% of its federal budget — on national and international defense. And while we finally managed to neutralize Syria with the help of our Middle East proxy state, our proxy war in Ukraine continues to fare poorly.

Towards a North American Empire

A North American Union built out of Canada and America would be over 10% larger than Russia. And while much of Canada’s terrain is inhospitable, there are rich stores of phosphate, bauxite, iron ore, copper, nickel, and diamond to be had. Go a bit further north, and you’ll find an estimated 13% (90 billion barrels) of the world's undiscovered oil and 30% of its undiscovered conventional natural gas.

Ukraine and Poland have no naturally defensible boundaries, which explains much of their history. North America has oceans on each side, a heavily armed populace, and a large supply of nuclear-tipped missiles. If we pulled back our Asian, African, and European military presence, our opponents have no reason to attack us and many reasons to avoid conflict.

Winding down our worldwide commitments might be bad news for some of the unpopular dictators we’ve propped up with money and weaponry. It might lead to disorder in places where we kept a fragile pax americana. But it would save us a great deal of money and keep us out of many foreign conflicts where our presence is neither needed nor desired.

A joint American-Canadian polity will face some resistance from Canadians. While many on this side of the border think of Canadians as Americans who say “Eh,” there are some important social differences to consider. We’re the Life, Liberty, and Pursuit of Happiness team. They’re the Peace, Order, and Good Government guys. We pride ourselves on booting the British. Most of Canada’s founding Anglophone stock were American Loyalists who had no use for our Revolution.

Given it has have ten provinces, Canada is unlikely to get on board with Trump’s “51st State.” Saskatchewan and Ontario are as socially divergent as North Dakota and Massachusetts. And we haven’t even started talking — or should I say nous n'avons même pas commencé à parler — about Quebec.

Taking Canada by military force would involve a bloody war in hostile terrain. (This is also why I don’t expect Trump to send troops into Mexico, a country with less hostile terrain but more hostile cartels). Trump’s threats of destroying the Canadian economy with tariffs have received a frosty reception in Canada. But he’s used to negotiating with both carrots and sticks, and there are carrots to be had for both sides.

Canada is on the verge of an economic meltdown. A North American Union which offered freedom of movement and employment like the EU would give Canadians better access to American housing and American jobs. And while the European Union wound up mired in democracy, an NAU that promised less red tape might be greeted with enthusiasm by long-suffering Canadians.

Will this happen? Trump appears to be giving the idea serious thought, and he has others talking about it as well. And, of course, there are all those sweet sweet natural resources and untapped oil fields just waiting to be monetized. he question may not be whether or not it should happen. The question may be who’s going to make the first move, and who’s going to stop them.

It could be bluster or it could be start of long hostilities. But a decentralized North American Union which left most governing to the states and provinces might leave us with a less divided and more peaceful society on both sides of the 49th Parallel.