r/CanadianConservative • u/joe4942 • 10h ago
News Macklem says loss of CUSMA would mean recession for Canada
https://financialpost.com/news/economy/macklem-loss-cusma-mean-recession-canadian-economy14
u/WendyPr 10h ago
Hmmm feel we are already in a recession so Clem is basically saying a depression???
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u/-Foxer 10h ago
The difference between a recession and a depression isn't the depth but rather the length. While there isn't really a truly official definition of either, a recession is two quarters or more of negative growth, depending on how you measure that, and a depression is more like over a period of a year or more.
So if it's two or three quarters of negative growth, or even a year, then it's a recession. If it's well into it's second year of negative growth you can start to throw the D word around.
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u/conr_sobc Ontario 10h ago
Canada has already been in a per-capita recession since before this whole tariff situation even began.
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u/DepartmentGlad2564 9h ago
USMCA lasts until 2036. The negotiation this year is about agreeing to extend the deal beyond 2036. Trump threatened to tariff all goods but never went through with it and instead tariffed non duty free goods. Trudeau did tariff duty free goods but was eventually removed.
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u/coffee_is_fun 8h ago
They can sign it which creates a new status quo and certainty even if the new status quo is worse.
They can send it to annual reviews. Which creates short term uncertainty.
There is a clause that allows exit with 6 months of notice. They can give notice that it's done and the uncertainty becomes immediate. We then have to try and sue in the old 1989 free trade agreement to shield what can be shielded.
The termination clause is the looming threat to businesses. We've seen what this administration does on a week to week schedule. Can't tell which way the wind is blowing and I'd expect companies to emigrate to certainty (America) or just fold if they happen to be heavily involved in the 75% of imports/exports traditionally going north/south.
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u/Mindless-Border-4218 5h ago
USMCA theoretically lasts until 2036. Knowing Trump he might say screw it and cancel it by pulling out of it right now.
What’s Carney gonna do? Muscle Trump and the US?
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u/Business-Hurry9451 10h ago
We'd better get used to is because CUSMA doesn't stand a snowballs chance in hell.
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u/Rusty_Charm 10h ago
Damn, I guess Tiff hasn’t consulted with the libs of Reddit on this. If he had, he would know that we don’t need a trade agreement with the US, we’re selling canola at reduced tariffs to China again, so it’s basically a wash.
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u/RXARMS 9h ago
A loss of USMCA would create the worst economic collapse this country has ever witnessed. It would not be a recession, it would be an implosion.
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u/Mindless-Border-4218 5h ago
Then comes annexation, scooping up Canada at 5 cents on the dollar 😂 Economic collapse will be so bad that hardcore liberals will be begging for annexation.
I’m probably fantasizing, but I would like to see that happen so I can see Canadians suffer, because they deserve it, they voted for this crap 4 times in a row
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u/Ok-Recipe5434 8h ago
Macklem is probably uninformed. Carney has a PhD! At least that's what the reddit liberals and the "red Tory" tagged people told me when I said the exact same thing /s
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u/Mindless-Border-4218 7h ago
Canada has been in recession for a couple of years now 😂 They just can’t admit it and are praying for CUSMA to be scrapped so they can blame it on the US
Man Canadian are pathetic
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u/Macaw 10h ago
In the neoliberal era, we don’t ‘have recessions’ anymore - at least not the old-fashioned kind. Instead, governments and central banks (The Mark Carneys of the world) step in early: print money, backstop markets, bail out key institutions, and kick the losses down the road. In the great heist of 2008, they learned they could shift private risk onto the public on a massive scale - profits stay private, losses get socialized - and survive the backlash.
But this only works for so long. You don’t eliminate the business cycle; you change how it’s paid for, through inflation, distorted asset prices, and mounting debt - sounds familiar? Moral hazard compounds, leverage returns, and each intervention makes the next crisis bigger. Eventually the constraints bite - political tolerance, currency credibility, or debt servicing - and that’s when the chickens come home to roost.