The United States Steel Corporation’s furnaces glowed orange against the night sky in Gary, Indiana as I toured the facility last week. The scene was both impressive and symbolic – American steel production standing tall, yet vulnerable to the winds of political change that now threaten to upend North American trade relations once again.
“We’ve been down this road before,” said Michael Rodríguez, a steelworker with 27 years of experience, his face weathered from decades on the production floor. “Every time there’s an election, we wonder if our jobs will be the bargaining chips.“
Rodríguez’s concerns mirror the anxiety rippling through industrial communities across both the United States and Canada as president-elect Donald Trump prepares to potentially revisit his hardline stance on trade policy, particularly targeting Canadian steel and aluminum imports.
The rhetoric has intensified in recent weeks, with Trump’s transition team floating proposals for tariffs as high as 25% on Canadian steel – despite the supposed protections of the Canada-United States-Mexico Agreement (CUSMA) that replaced NAFTA in 2020.
“What we’re seeing is a potential return to economic nationalism that treats even America’s closest allies as competitors rather than partners,” explained Dr. Elaine Crawford, trade economist at the Peterson Institute for International Economics. “The irony is that CUSMA was negotiated under Trump’s first administration, yet these proposed tariffs would undermine the very agreement his team crafted.”
The stakes are particularly high for Canada’s steel sector, which employs over 23,000 workers directly and supports roughly 100,000 indirect jobs. The industry exported approximately $4.3 billion worth of steel to the U.S. in 2023, according to Statistics Canada.
For communities like Hamilton, Ontario – Canada’s steel capital – the economic ripple effects could be devastating. During my visit there in September, city officials expressed concern about potential job losses reaching into the thousands if significant tariffs are imposed.
“We’ve invested billions in modernizing our facilities to reduce carbon emissions while maintaining competitiveness,” said Jennifer Torres, communications director for the Canadian Steel Producers Association. “These arbitrary tariffs would punish that innovation rather than reward it.”
The controversy centers on Trump’s previous use of Section 232 of the Trade Expansion Act of 1962, which allows the president to impose tariffs on imports deemed to threaten national security. In 2018, Trump used this provision to levy 25% tariffs on steel and 10% on aluminum from multiple countries, including Canada, before eventually negotiating exemptions.
Defense experts question the national security justification. “Canada supplies critical steel for American defense manufacturing and has been a security partner for over a century,” noted retired U.S. Army General David Hathaway, now with the Atlantic Council. “Labeling Canadian steel a security threat strains credibility and military logic.”
The Canadian government has begun preparing retaliatory measures. Deputy Prime Minister Chrystia Freeland, who negotiated the original CUSMA deal, stated during a press conference in Ottawa: “Canada will always stand up for our workers. If unjustified tariffs are imposed, we will respond proportionally and strategically.“
Sources within Global Affairs Canada indicate potential tariffs on U.S. agricultural products and manufactured goods from politically sensitive states could be targeted. Such countermeasures would mirror Canada’s response to the 2018 tariffs, which strategically hit products from Republican-dominated states.
The economic calculus extends beyond simple trade figures. Integrated supply chains mean disruptions flow both ways. At the Algoma Steel facility in Sault Ste. Marie, which I toured in August, managers explained how automotive components often cross the border multiple times before final assembly.
“People don’t realize how interconnected we are,” said Robert Lapointe, a shift supervisor at Algoma. “The steel in a Ford F-150 might cross the border five times during production. Adding tariffs at each crossing would make North American manufacturing uncompetitive globally.”
U.S. manufacturers dependent on Canadian inputs have voiced opposition to the tariff proposals. The American Automotive Policy Council estimates that steel tariffs could increase production costs by $300-700 per vehicle, potentially resulting in higher consumer prices and reduced sales.
“We’ve spent decades building integrated supply chains to compete with Asia,” said Thomas Wilson, procurement director for a major U.S. appliance manufacturer. “Disrupting that integration hands an advantage to Chinese manufacturers.”
While some American steelworkers support protectionist measures, union perspectives remain divided. The United Steelworkers union represents members in both countries, creating an awkward position.
“Our members don’t stop being our brothers and sisters at the border,” said Leo Gerard, former USW president whom I interviewed at his Pittsburgh office. “The real competition isn’t between American and Canadian workers – it’s with producers who don’t follow labor standards or environmental regulations.“
The coming months will likely feature intense negotiations as the Canadian government attempts to secure exemptions before any new tariffs are implemented. Economic analysts suggest the uncertainty alone could chill investment in both countries’ manufacturing sectors.
As I left the steel plant in Gary, the orange glow of the furnaces remained visible for miles – a reminder of industrial might that has defined the North American economy for generations. Whether that shared industrial future continues to burn bright or dims under the weight of trade disputes remains an open question, with implications extending far beyond steel and aluminum.
For workers like Rodríguez in Indiana and Lapointe in Ontario, the political calculations behind tariff policies translate to immediate concerns about mortgages, family healthcare, and community stability – human costs often overlooked in the broader economic debate.
