Trump Ends Canada Trade Talks After Reagan-Themed Ad Sparks Diplomatic Rift

U.S. President Donald Trump has abruptly terminated all trade negotiations with Canada, citing what he called “egregious behavior” after a controversial advertisement from Ontario criticized his tariff policies using a decades-old speech by former president Ronald Reagan.

The 60-second television spot, funded by Ontario’s government, features Reagan warning that trade barriers “hurt every American worker and consumer.” The clip, which aired on U.S. channels, was designed to highlight the economic cost of tariffs on cross-border trade. Trump responded furiously on social media, calling the ad “fake” and accusing Canada of attempting to “interfere” with ongoing U.S. court proceedings over the legality of his global tariffs. He then declared that “all trade negotiations with Canada are hereby terminated.”

The U.S. State Department confirmed that discussions with Ottawa were suspended. Trump later repeated his accusations, claiming Canada had “cheated and got caught,” arguing the ad was an intentional effort to influence the upcoming Supreme Court hearings set for early November. The case will determine whether Washington’s sweeping tariff program — central to Trump’s economic platform — violates U.S. law.

Washington first imposed a 25% tariff on Canadian goods, including aluminum, timber, and automobiles, earlier this year. The rate was later raised to 35%, drawing retaliation from Ottawa. Ontario, whose manufacturing-heavy economy has been among the hardest hit, has been particularly vocal in its opposition. Premier Doug Ford has repeatedly denounced the tariffs, describing them as a “knife to Canada’s back,” and launched a $75 million media campaign in response.

The Reagan Foundation criticized Ontario for using the former president’s words without permission, saying the advertisement “misrepresented” his 1987 address. In that speech, Reagan warned against protectionism but acknowledged imposing limited tariffs on Japanese semiconductors at the time to enforce fair trade. The Foundation said it was reviewing legal options, while Trump cited its criticism as justification for halting talks.

Canadian Prime Minister Mark Carney expressed disappointment at Trump’s decision, saying Canada remains ready to resume trade discussions “when the Americans are ready.” Speaking before departing for an Asian summit, Carney emphasized his government’s goal of diversifying trade relationships and building new economic partnerships beyond the U.S.

Despite the escalating rhetoric, Canada remains deeply dependent on the American market — roughly three-quarters of its exports head south of the border, amounting to about C$3.6 billion in daily trade. The suspension of negotiations could therefore have far-reaching economic consequences for both sides, especially for border provinces like Ontario that rely heavily on U.S. demand.

Trump’s move also fits into a broader pattern of economic confrontation. His administration recently expanded sanctions against Russia’s oil sector and is tightening its approach to China ahead of a high-profile meeting with President Xi Jinping. Analysts see these moves as part of a renewed “America First” push that mirrors Trump’s first term, emphasizing tariffs, trade leverage, and economic nationalism.

Meanwhile, Ford doubled down on his province’s campaign, reposting the full Reagan speech on social media and asserting that “Canada and the United States are friends, neighbors, and allies. President Ronald Reagan knew we are stronger together.” The premier’s message underscores the irony of using Reagan — a conservative American icon — to challenge Trump’s protectionist agenda.

As tensions rise, it remains unclear whether the White House’s “time-out” from Canada will last weeks or months. For now, both nations appear locked in a trade standoff that began with a one-minute political ad — but may end up reshaping one of the world’s closest economic relationships.