Canada at the Crossroads: Reimagining Fundamental Values in an Existential Crisis

Oliver Schmidtke, University of Victoria

ofs@uvic.ca 

March 31, 2025

The tariff-induced trade war and increasingly serious threats to Canada’s sovereignty have sparked indignation and resolve among the public. The Trump administration’s condescending attitude and aggressive stance toward one of its closest allies and friends has also led to a political reckoning: Have the decades of amicable relations and strategic alliance with its southern neighbor come to an end? Is the alienation from the USA irrevocable, or merely indicative of a historically challenging relationship that, once the political pendulum swings back from the “America First” nationalism of the MAGA movement, can be restored?

Canada’s political elite has reacted with consternation and disbelief. Yet even vocal defenders of the country’s sovereignty, such as Premier Ford in Ontario, act like disheartened lovers who cannot comprehend the rejection and desperately want to mend what plainly appears to be beyond repair. It is time for the country’s political leaders and Canadian society to fully confront a reality that, six months ago, would have been difficult to fathom in all its implications: With President Trump’s decision to reignite America’s imperialist aspirations, the multilateral, rules-based international order is fundamentally disputed. Brute economic and military force will increasingly determine international politics and trade. Domestically, this internationally aggressive stance is ideologically rooted in an exclusionary nationalism and a deliberate attempt to weaken liberal democracy, further entrenching steps towards authoritarian rule.

Where does this leave Canada? The shock over the not-so-subtle threat to the country’s sovereignty has brought into the spotlight its structural dependency on the USA in terms of both its economy and security regime. Reliance on its powerful southern neighbor is not new; it has been a constant feature in Canada’s history. Yet, over the past decades, efforts to diversify trade relationships have largely failed, often deemed too onerous, politically inconvenient, or simply excessively costly.

Canada’s relationship with the European Union is a case in point. The Canada-European Union Comprehensive Economic and Trade Agreement (CETA) has been in place since 2017, removing almost all tariffs within this transatlantic trading bloc. While bilateral trade expanded by 57.5% between 2016 and 2024, Canada has yet to fully exploit the enormous potential for diversifying its export markets that CETA provides. The negotiations leading up to the agreement also serve as a reminder of the complexities and potential domestic divisions that the process of applying for EU membership would entail, ranging from issues in Canada’s dairy market to its monetary policies, energy products, and environmental regulations.

The current debate on the desirability and feasibility of EU membership reflects a painful realization: Canada faces a momentous choice. As Prime Minister Trudeau alluded to, Canada is grappling with an existential crisis, not only due to tariff threats against some of its key industries but also because of its deteriorating relationship with the U.S. under the Trump presidency. This strained alliance should serve as a wake-up call for a country reassessing its political identity in a rapidly changing world order. In this context, the project of European integration represents more than a convenient opportunity to revamp external trade relationships. At its core, the EU embodies a distinct vision of foundational political principles, — including multilateralism, social inclusion, environmental responsibility, and democratic constitutionalism.

If Canada were to pursue a gradual strategic disengagement from the United States, forging a closer partnership with the EU would appear to be the best option. As Prime Minister Mark Carney aptly described it on his recent trip to the UK, Canada is “the most European of the non-European countries.” The 2017 Strategic Partnership Agreement between Canada and the EU provides a solid legal and political framework for collaboration on key policy areas such as security, climate change, environmental protection, green and digital transitions, and public health.

In particular, the commitment to diversity is a critical, albeit often overlooked, feature of the shared Canadian-European political identity. Both are founded on a strong commitment to the linguistic and cultural diversity of their respective polities. In response to this pluralism, their political cultures and governance structures prioritize public deliberation and compromise — exemplified by Canada’s policy of multiculturalism, bilingualism and Indigenous reconciliation as well as the EU’s principles of subsidiarity and multi-level governance. It is no coincidence that this approach fosters a more inclusive, deliberative vision of political community and culture, one that is less susceptible to the lure of belligerent nationalism.

The central question in Canada’s search for a reliable and value-based partnership is whether the EU has the resilience and commitment to uphold its central political vision. As a champion of liberal democracy and a rules-based international order, Europe itself faces the risks of succumbing to the hyperbolic nationalism and authoritarian tendencies that are currently taking hold in the U.S. The rise of right-wing populist and nationalist parties across the EU threatens the very foundations of European integration and the democratic governance it upholds. A strong transatlantic partnership, centered on shared commitments to multilateralism, fair trade, and democratic governance, ultimately depends on a revitalized European Union. The Trump presidency has brought these fundamental political choices into sharper focus.

So, should Canada pursue EU membership? As a long-term prospect, this option is both undoubtedly attractive and, at the same time, full of political uncertainty. Considering the complexities involved in this process, a firm association with the EU without full membership — modeled after Norway’s arrangement — may prove more practical and politically productive over the next couple of years. Most importantly, signaling a commitment to a close alliance with the EU would send a powerful and urgently needed message both domestically and internationally. It would reaffirm a value-based vision for Canada’s political future in a radically changed international context.