POLI 1120 - Policy Brief: Canada's Vulnerability to Populism

This policy brief examines the potential impact of Donald Trump's presidency on Canada, focusing on the rise of populist movements and their effects on the Canadian economy. The brief discusses how changes in US trade and domestic policies, particularly regarding trade and electronic goods, affected Canada's import/export dynamics and contributed to economic pressures, including a decline in the Canadian dollar. It also highlights the Canadian government's current policies aimed at mitigating these challenges, such as employment benefits, trade diversification, and poverty reduction strategies. The recommendations include increasing administrative efficiency, creating new employment opportunities, and improving trade relationships with economically developed countries to strengthen Canada's position in the international market and reduce the adverse impacts of external political and economic shifts.

Running head: CANADIAN POLICY BRIEF
CANADIAN POLICY BRIEF

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Table of Contents
1. Executive Summary.....................................................................................................................3
2. Discussing relevant definition, information, context to understand the problem........................4
3. Discussing the current state of policy..........................................................................................5
4. Recommendations........................................................................................................................7
References........................................................................................................................................9

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1. Executive Summary
In order to discuss domestic policy in Canada, the topic that has been chosen is the
potential movement of Trump after coming in position in the US and its impacts on Canada due
to an angry populist movement of Trump. Therefore, it can be stated that the study will be
discussing the potential information related to the topic from which the economy of Canada has
got affected.
In briefing poverty in Canada, a number of aspects and circumstances have been highlighted as
the effect of the angry populist movement. The problems that were faced by Canada that time
have been identified. It has been found that Canada experienced trade restriction after changes in
policies by Trump and therefore, import and export of Canada were affected. Specially, the
electronic market of the country had to suffer. Dollar value was reduced which also caused
pressure on the Canadian Government.
In the third section, the current state of policy implementation by Canadian Government has
been mentioned to reduce poverty within the country. It has been identified that the Government
has introduced the strategy providing equal opportunity to all along with employment benefits.
On the other hand, it has created trade policy and emphasized on building trade relationships
with those countries that are economically developed to fulfill the objective of enhancing
international trade.
As per recommendations, it has been suggested to increase administrative efficiency so that the
country could strengthen its position in the international market. New employment opportunities
need to be provided and new policies to be incorporated so that these can benefit trade system.

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2. Discussing relevant definition, information, context to understand the
problem
It can be stated in this context that during the presidency of Donald trump, the political
and economic position of Canada have deteriorated and has resulted in increasing poverty rate in
Canada. Donald Trump might be the president of the US; however, it has definitely impacted
Canada too due to his angry populist movement. His presidential rules have brought some
changes in domestic policies specially trade and oil. As opined by Inglehart & Norris (2016), the
rising and coming into position of populist parties in the US, the political conditions of many
countries have been disrupted and on the other hand, the break out of Brexit supported such a
condition.
Reduction in Canadian dollar
Canada has experienced a decline in its dollar value after 2017 as it depends on energy policies
as well as environment regulations belonging to the US. Another reason for the decline in
Canadian dollar might be the increased global supply of oil. Therefore, it can be said that due to
the reduction in the value of Canadian dollar, it faced pressure in the fronts of trading with other
countries (McBride & Sergie, 2017). The domestic business and organizations are not being able
to make profit as much as needed which in turn is influencing export and import adversely.
Donald Trump created feud with China made electronic more expensive in Canada
It has been stated that after coming into position, Donald Trump imposed a lump sum amount of
tariff on the electronics goods imported from China. All know it that China is the manufacturing
giant of electronics goods specially, mobile phones and laptops. Therefore, this policy made
China out of the market of Canada and resulted in an increased price of electronic commodities.
As a result, the cost of manufacturing in Canada increased widely due to lack of innovative
technology and a suitable market. It affected the small business, owners of electronic shops and

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the other producers. It can damage the total flow of supply of electronic goods, which in turn will
adversely impact on the demand of electronics goods (Inglehart & Norris, 2016). Due to the
enhanced price of such goods, the purchasing power of consumers decreased. Hence, poverty
generated in terms of this issue in the electronic goods market, especially for those people who
were directly involved in this business.
Trade
During the campaign of Donald Trump, the stated person made radically overhauling trade
arrangements in the US, a key issue that had the greatest impact on the economy of Canada.
Canada was forced to renegotiate the North American free trade agreement for the wellbeing of
the US trade market. Trump threatened Canada to leave NAFTA if it does not agree with the deal
(Georges, 2017). On the other hand, Trump took the policy of independence and isolationism in
terms of business to create more jobs and developing infrastructure that increased the price of
every imported commodity in the market of Canada, and worsened the economic condition.
Policy of migrants by populist movement
One of the major actions taken by angry populism party was calling for the arrest of
undocumented immigrants in which most of the migrants were identified as Canadian (Adams,
M., 2017). According to the index of overall inclusiveness, Canada ranked first among 25
countries. As a result, it hit the economy of Canada which created pressure on the Government of
Canada.
3. Discussing the current state of policy
In order to stabilize the condition, Canadian Government took some necessary steps to
stabilize the economic conditions throughout the country especially after the emerging Trump
presidency (Hadfield & Potter, 2017). The policies were adopted by the country to obtain

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suitable trade, increase economic activity, accelerate entrepreneurship and enhance employment
within Canada (Schwanen, 2017).
Jobs and employment
It has been mentioned above that Canadian import and export along with the electrical market
was affected due to the change in domestic policy by the US government during Trump’s time.
In order to penetrate the domestic market, the government is trying to break the dependency on
China. It has urged the large business organizations to provide training and development to the
employees. It has given opportunities to all, which was Canada’s first poverty reduction strategy
introduced in 2018. For this purpose, $22billion was invested for the economic and social well
being of Canadians (Awan, 2015). It has been introduced based on major three pillars such as
dignity, opportunity and inclusion and lastly, resilience and security. The target of the policy is to
decrease poverty by 20% by 2020 depending on the measurement of Canada’s official poverty
line.
Workers benefit
Canada has introduced a new policy for workers benefits to not only strengthen but also replace
the past working income tax benefit in 2018. It allows the people with lower income to earn
more money while they work thus enhancing the total level of income. On the other hand,
guaranteed income supplement aims in providing old age security pension for the lower income
people living in Canada (Blank & Gattinger, 2018).
Trade policy
In the context of trade policy, the Canadian Government has negotiated to boost their bargaining
position and enhance the access of privilege in the US market. The first and foremost aspect is
that Canada had to adopt one in between two choices that are globally oriented policy and

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emphasizing on harmonizing policy with the US. The most helpful strategic action for Canada is
to diversify its geographical trade pattern (Georges, 2017). Therefore, it will derive economic
benefit from trading towards countries with rapid demographic and economic growth. Production
in Canada is required to be increased in all sectors along with multinational companies in Canada
(Paley, 2017). Due to the current trade policy, the investors become more enthusiastic to invest
more in the economy of Canada as the condition of import and export at the current years are
quite better. Apart from that, FDI inflows as well as the Canadian disinvestment enhanced
because of availability of stock of capital.
4. Recommendations
The potential recommendations for improving the economic and social condition of Canada
in the near future which can help the country to get out of the adverse effect of Trump time are as
follows:
● The federal Government of Canada is required to commit a guaranteed annual income for
the country so that administrative efficiency can be achieved. A large amount of income
will attract the investors and large businesspersons to set up their business in the location
of Canada and boost the marketing conditions in each sector. However, the Government
may raise the tax revenue to generate more income, which can affect general people of
Canada as they will face difficulty in providing more tax and therefore, face poverty.
● The Government is required to increase jobs and employment for the betterment of the
Canadian people. In 2018, the employment was very low than the previous years.
However, in 2019 and 2020 the rate has been increased due to its trade policy. Still more
improvement is needed to reduce the risk in the future. One cons of this recommendation
can be the government revenue might be reduced for this action.

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● It will focus more on offering incentives to the employees and make new policy through
which small and medium businesses can arrange a fixed amount of resources from the
Government. It will urge the industries in Canada to facilitate the employees with training
and development so that incentives to work can be removed and they find it costly to do
work.
● Most importantly, Canadian Government is required to improve trade relationships with
those countries that are economically developed so that trade advantage can be obtained.
In this context, it needs to increase communication systems with those countries and
make necessary changes in trade agreements.

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References
Adams, M., 2017. Could it happen here?: Canada in the age of Trump and Brexit. Simon and
Schuster.
Awan, A. G. (2015). Analysis of the impact of 2008 financial crisis on the economic, political
and health systems and societies of advanced countries. Global Journal of Management
and Social Sciences, 1(1), 1-16.
Blank, S., & Gattinger, M. (2018). Canada-US relations under president Trump: Stop reading the
tweets and look to the future. In Justin Trudeau and Canadian Foreign Policy (pp. 83-
102). Palgrave Macmillan, Cham.
Georges, P. (2017). Canada's Trade Policy Options Under Donald Trump: NAFTA's Rules of
Origin, Canada-US Security Perimeter, and Canada's Geographical Trade
Diversification Opportunities. Department of Economics, University of Ottawa.
Hadfield, A., & Potter, R. (2017). Trump, Trudeau and NAFTA 2.0: tweak or
transformation?. The Round Table, 106(2), 213-215.
Inglehart, R. F., & Norris, P. (2016). Trump, Brexit, and the rise of populism: Economic have-
nots and cultural backlash.
Inglehart, R. F., & Norris, P. (2016). Trump, Brexit, and the rise of populism: Economic have-
nots and cultural backlash.
McBride, J., & Sergie, M. A. (2017). NAFTA’s economic impact. Council on Foreign
Relations, 24.
Paley, D. (2017). NAFTA traffic: How trump could exacerbate the devastating effects of
NAFTA for Mexico’s autoworkers. NACLA Report on the Americas, 49(2), 173-181.

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Schwanen, D. (2017). Innovation Policy in Canada: A Holistic Approach. CD Howe Institute
Commentary, 497.