[By Anne Lowery, translated by Whale Life]
In March 2025, Nicolas Gilbert received a shipment of feed at his dairy farm in Potsdam Town, New York State. The ranch, only 32 kilometers from the Ontario, Canada border, housed 1,400 cows. Upon arrival, the shipment unexpectedly incurred an additional $2,200 in tariffs.
Gilbert complained to me: "Our profit margins are slim. We signed a contract for delivered feed with a set price per ton. But they added this tariff out of nowhere, just because the feed came from a Canadian processing plant."
Gilbert couldn't raise milk prices as they were set by local cooperatives; he couldn't reduce the amount of feed given to the cows, nor could he switch to another supplier: there were no other options nearby, and sourcing from further away would be even more expensive. After receiving the feed, Gilbert stared at the tariff bill for quite some time. Shouldn't it be the responsibility of his Canadian supplier to pay the tariff?
"Is this legal? I can hardly believe it! We signed a contract for delivered price! If your fuel costs increase or trucks break down, that's not my problem! That's what contracts are for."
But the tariff was legal, and Gilbert had to bear the cost. He was just one of tens of thousands of American business owners caught up in the whirlwind of a trade war, and the region where he lived might already be experiencing a recession due to tariffs. Enterprises near the U.S.-Canada border were particularly vulnerable, such as rising costs and shrinking revenue. They were delaying projects and hiring, raising prices, cutting staff, or worrying about how to continue feeding their cows.
Vehicles waiting in line to enter the United States at the U.S.-Canada border
Shortly after taking office, President Trump imposed tariffs on steel, aluminum, and other goods from China, Canada, and Mexico, initiating the long-promised trade war he had promised. He mistakenly believed that foreign companies would pay the tariffs and that the U.S. economy would soar. On April 2, Trump launched a "shock" offensive against global trade, announcing tariffs on all U.S. trading partners.
Trump claimed these measures were to counter foreign tariffs and trade barriers. However, the numbers bore no relation to any supposed "trade barriers" (some countries didn't even have such policies). The White House imposed at least 10% tariffs on imports from around the world and higher rates on imports from over 60 countries, regions, and trade groups. The Trump administration seemed to calculate these high rates by dividing the bilateral trade deficit value of one country with its exports to the U.S.
Such tariff increases were haphazard, reckless, and absurd. The Trump administration only considered goods trade and ignored services trade. He taxed countries that had signed long-term free trade agreements with Washington, such as Australia, South Korea, Israel, Panama, Singapore, Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic. Countries with trade surpluses with the U.S., remote uninhabited islands, and even regions mainly controlled by British and American troops were also subject to tariffs.
Nevertheless, this ridiculous policy still had real-world effects. American consumer goods became more expensive. If tariffs remained this high for a long time, an average American household would spend an additional $3,800 annually on groceries, cars, clothing, furniture, and other purchases. Thousands of small and medium-sized American companies would go bankrupt. Due to a few power-holders and ideologically driven people who cling to erroneous beliefs about trade, the U.S. could plunge into an economically self-inflicted recession in a shocking manner.
If you want to understand the direction of the U.S. economy, look for answers at the border.
From Whatcom County in Bellingham, Washington, to Calais, Maine, dozens of American communities are not just economically linked to Canada but have formed symbiotic relationships. These places' gas stations primarily serve Canadian commuters; ski resorts and water parks are mostly frequented by Canadian tourists; local manufacturing enterprises rely on Canadian raw materials, farms depend on Canadian feed, and hotels count on Canadian business meetings.
In contrast to Trump's claims, tariffs are actually borne by U.S. importers, not foreign exporters. Most businesses pass these costs onto consumers, while others (like Easton Farm in Potsdam mentioned earlier) cannot. Gilbert candidly admitted that he also pays tariffs when purchasing fertilizers and agricultural equipment. "Our industry is different from others; the pace of transformation is very slow, and we have no room for adjustment."
On April 3rd local time, Canadian Prime Minister Kane announced countermeasures against the U.S. Video screenshot
As steel, aluminum, timber, and mechanical parts costs rose, manufacturing enterprises and construction companies near the U.S.-Canada border found themselves in the same predicament. These businesses couldn't quickly transfer operations or find new suppliers. Gary Douglas of the Northern New York Chamber of Commerce revealed: "We surveyed 40 local manufacturing enterprises. One company that sources raw materials from Canada will see its operating costs in the U.S. increase by $16 million. Another paper mill imports pulp from Canada, which is the only source they can find."
While increasing the costs for border enterprises, Trump's "Don Quixote"-style trade war against Canada was also reducing these enterprises' revenues. Dan Kelleher runs a tourism promotion agency in the Adirondack Mountains of New York State. He told me: "In terms of overall visitor volume, our performance in January was impressive, growing by 24% compared to the five-year average. But February saw a sharp decline."
President Trump continually described Canada as the "51st state" and imposed a 25% tariff on this closest ally. Kelleher told me that accommodation spending fell by 4% in February, and retail sales plummeted by 20%.
"We have many cross-border organizations, especially ice hockey games," Kelleher mentioned. "The Canadian teams that sign up will definitely come, but they consume nothing once they enter the U.S."
Beyond worrying about the summer tourist season, Kelleher was more concerned about the relationship between residents of the Adirondack region and their northern neighbors. "Our Canadian friends are frustrated and hurt; they feel betrayed."
Ron Kurnik holds dual U.S.-Canadian citizenship, resides in Canada, and commutes between the two countries. He operates a café (and coffee bean distributor) in Sault Ste. Marie, Michigan. He told me: "Our signature product includes a blend of espresso named 'Friendly Neighbor.' We label it with both the American ('neighbors') and Canadian ('neighbours') spellings. This coffee has always been central to our business and symbolizes our close ties with the local community."
Kurnik imports coffee beans from Mexico and packaging bags from China; due to Trump's tariffs, both costs have become more expensive. He revealed: "The new tariffs have put us in a loss-making position now."
As fewer Canadians crossed the St. Marys River to shop in the U.S., his café's sales also declined. Kurnik said the company had some leftover profits from last year, "which might, maybe, help us get through 2025." But he had already cut working hours and laid off one employee.
"I'm doing everything I can to maintain the status quo and avoid making too many major decisions. But if these tariffs persist for six to eight months or longer, the consequences will be unimaginable."
A sign in a Canadian store reads "American alcohol no longer sold"
Resident Americans of border towns found their shopping malls and fast-food restaurants deserted. Local newspapers reported rising construction costs and incidents of Canadians being detained at border checkpoints. They noticed recruitment notices disappeared, and evening news broadcasts carried reports on the trade war. Many people, expecting an economic downturn, reduced their spending: delaying home renovations and car purchases, canceling vacation plans, eating at home instead of dining out.
In Plattsburgh, New York, a town 20 minutes by car from the U.S.-Canada border, Mayor Michael Cashman said: "This will certainly have a ripple effect, and it will be immediate. Trade restrictions that seem insignificant in Washington are devastating to us locally."
Cashman was deeply worried about the decline in sales tax (sales tax, a tax levied by U.S. states and local governments on various goods and services based on a certain percentage of the selling price, translated by observers). The city of Plattsburgh planned to reduce public expenditures until the economic outlook became clearer. Of course, cutting budgets in a small town would only exacerbate the economic downturn.
What happened in Plattsburgh and Sault Ste. Marie also occurred in rural Nebraska, Bourbon County in Kentucky, and even Las Vegas—every community dependent on foreign tourists, imports, and cross-border activities was affected. Now, Trump's new tariffs have put the entire nation at risk. On the morning after the president declared "Liberation Day," I opened my email and read various comments from market analysts: "self-inflicted economic disaster," "huge headwind," "completely changed expectations," "absolute bearish sentiment," "longer-term turmoil," "historical shift," "insanity."
In the Upper Peninsula of Michigan, Kurnik was jotting down numbers with a pen—when retailers might raise the price of a bag of coffee beans and by how much production would decrease—while Trump prepared to deliver a speech in the White House Rose Garden. Kurnik said: "We can't run our business on feelings. This administration can organize itself on feelings. But honestly, how can you expect me to do the same?"
(Originally published on the "Atlantic Monthly" commentary website in the U.S., the translation is provided solely for reader reference and does not represent the views of Observer Network.)
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