Donald Trump accuses Canadians of smuggling shoes home from U.S.
Now he is calling Canadians shoe smugglers.
In the latest salvo in the president’s multi-front attack on Canadian trade practices, Trump told a story Tuesday about Canadians who cross the U.S. border to buy shoes. The tale left trade experts and apparel industry officials scratching their heads.
Trump launched into it while delivering a rambling speech, focused on illegal immigration, to the National Federation of Independent Businesses.
“There was a story two days ago in a major newspaper talking about people living in Canada coming to the United States and smuggling things back into Canada because the tariffs are so massive. The tariffs to get common items back into Canada are so high that they have to smuggle ‘em in,” Trump said, apparently referring to an essay in the New York Post by Canadian journalist Isabel Vincent. “They buy shoes, then they wear them. They scuff ’em up. They make them sound old or look old. No, we’re treated horribly.”
But there is no indication that any of this has anything to do with tariffs. And Trump’s claim that this shop-and-hide practice results in the U.S. being mistreated makes no sense at all, trade and apparel experts said.
The Footwear Distributors and Retailers of America, the U.S. industry’s lobby group, said in a statement: “The president seems misinformed about footwear trade.”
“On behalf of the American footwear industry, we welcome anyone from anywhere to come and purchase shoes in America. It helps both our brands and retailers grow. Period,” the group said. “We don’t care where they wear them, and if they get scuffed up all the better so we can sell them more.”
Under NAFTA, there are no Canadian tariffs on shoes manufactured in the U.S. Since more than 95 per cent of shoes sold in the U.S. are made abroad, any Canadian shoppers avoiding Canada’s tariffs upon their return home are actually avoiding tariffs on foreign-made items, mostly made-in-Asia goods.
In other words, Trump was complaining about Canadians spending money at U.S. stores and then refusing to pay the Canadian government for goods made in other countries — a process that does not victimize the U.S. in any way.
“There doesn’t seem to be an issue. I’m not sure why we’re talking about this. Yet again, we’re being led down this path when there really isn’t anything there,” said Bob Kirke, executive director of the Canadian Apparel Federation. “I feel like I’m going down the rabbit hole here.”
In a tweet to Prime Minister Justin Trudeau, the U.S. industry group added: “The US Footwear Industry welcomes you and all Canadians to come buy shoes in America! As many as you want — and scuff them up if you want, we can sell you more!”
Kirke said he doesn’t think “there’s any negotiation or discussion around footwear tariffs or rules of origin in the current NAFTA negotiation. Zero. Zip.” And he said lower shoe prices in the U.S. are a result of the competitiveness of the U.S. retail market, not tariffs.
“Both countries have tariffs on imported footwear,” said Karl Littler, vice-president of public affairs at the Retail Council of Canada. “His critique of Canada he might level at the U.S. system as well.”
Canadians don’t have to pay duties on their first $200 in purchases if they’re in the U.S. for 24 hours. They get an $800 exemption if they’re away 48 hours.
Another cross-border shopping issue has been significant in NAFTA talks: Canada’s $20 threshold, one of the lowest in the world, for duties on shipments mailed from abroad. The U.S. threshold is $800, and the Trump administration has called on Canada to raise its own.
On Tuesday, Trump again floated the idea of making separate deals with Canada and Mexico rather than preserving the North American Free Trade Agreement. He also made some of his usual false claims about the trade balance with Canada, and he again criticized Canada’s dairy tariffs.
“We can no longer be the stupid country. We want to be the smart country. So hopefully we’ll be able to work it out with Canada. We have very good relationships with Canada, we have for a long time, and hopefully that’ll work out, but Canada’s not going to take advantage of the United States any longer. And Mexico’s not going to take advantage of the United States any longer,” he said.
Trump also scoffed at Trudeau’s argument against the steel and aluminum tariffs that Trump imposed on “national security” grounds. Trudeau has invoked the Canadian soldiers who have fought and died with American soldiers. On Tuesday, Trump paraphrased the argument with a hint of mockery.
“By the way, Canada, they like to talk,” Trump said to laughter. “They’re our great neighbour. They fought World War II with us. We appreciate it. They fought World War I with us, and we appreciate it. But we’re protecting each other.”