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Canada stunned and worried about Trump trade threats

TORONTO

It started with President Donald Trump’s attacks on Canadian dairy farmers. Then Washington slapped tariffs on Canadian steel, citing national security. There was that disastrous G-7 summit in Quebec. Now it’s a new trade agreement that excludes America’s northern neighbor.

Canadians are stunned by the repeated broadsides from what has long been their closest ally. Some have even begun boycotts.

“Everybody is afraid,” said Margot Lajeunesse, who helps run a family-owned bistro in Quebec. “We depend a lot on the U.S.”

About 75 percent of Canada’s exports go to the U.S., so the tariff threat looms large after Trump snubbed Canada and reached a preliminary deal with Mexico.

LaLa Bistro, owned by the Lajeunesse family, is among Canadian businesses that are boycotting California wines, American ketchup and other U.S. products in protest. Some Canadians have canceled U.S. vacations, particularly after Trump assailed Canadian Prime Minister Justin Trudeau at the G-7 meeting in June, calling him a “weak” and “dishonest” back-stabber.

“It’s not the way you treat a friend,” Lajeunesse said.

“It’s revolting,” agreed Raymonde Kennedy, who has ceased buying American products like mustard and clothing. “We won’t be insulted like that by a man with no brain.”

Luc Routhier, co-owner of Bar Le P’tit Canot in Quebec, also banned American wine from his eatery after Trump announced tariffs on Canadian aluminum and threatened Quebec’s dairy industry.

“I’m not even going to the U.S. this year,” he said. “I’m a golfer, and normally I do two trips a year to the U.S. with my buddies.”

“I’ll only go back to the United States when Trump is gone.”

To intensify the pressure on Canada, Trump threatened this week to impose new taxes on Canadian auto imports if Canada didn’t negotiate “fairly.” Canada must now decide whether to sign onto an agreement it didn’t negotiate or risk that the U.S. and Mexico will make good on threats to do a two-way deal that excludes it.

Canada could lose 60,000 jobs in a trade war and take a 1 percent hit to its GDP—a significant drop because Canada’s economy is projected to grow just 2 percent next year, according to estimates from the C.D. Howe Institute, a Toronto-based think tank.

Canada had been left out of the trade talks for the past five weeks, but Trudeau said there was still a “possibility of getting to a good deal for Canada” by Trump’s deadline of Friday.

“But,” he added, “as I’ve said all along it has to be the right deal for Canada.”

Trump expressed optimism Wednesday that a deal could be reached.

“We gave until Friday, and I think we’re probably on track,” Trump said. “We’ll see what happens. I love Canada. And you know what, I love Mexico too. ... I like them both the same.”

There is some optimism in Canada’s automotive sector despite the Trump tariff threats.

Among other things, the U.S.-Mexico deal mandates that 40 to 45 percent of a car be made in a country with a minimum hourly wage for auto workers of at least $16 to qualify for duty-free status—a requirement that could stem the flow of auto-sector jobs to Mexico, where auto workers earn on average just $5 an hour.

“This should stop the bleeding in Canada,” said Jerry Dias, president of Unifor, Canada’s largest private-sector union.

Bank of Montreal chief economist Douglas Porter said the U.S. deal with Mexico leaves Canada in a near take-it-or-leave-it situation. Still, he noted investors have welcomed the news and that helped push the Canadian dollar up 0.5 percent. Stocks of Canadian auto parts companies were up too.

“Perhaps the clearest indicator that the market is viewing the U.S.-Mexico deal as a positive for Canada is the strengthening of the Canadian dollar,” Porter said.

Reaction in the Canadian press reflected the mixed feeling about the U.S.-Mexico deal.

“Canada scrambles as U.S., Mexico ink NAFTA pact,” headlined the Globe and Mail, Canada’s national newspaper.

The Toronto Star had a different take. “PM cool in the face of Trump’s NAFTA heat,” it read.

Canadian Foreign Affairs Minister Chrystia Freeland hurried to Washington this week to try to repair the damage and was in talks Wednesday with U.S. Trade Representative Robert Lighthizer and other U.S. officials.

“Mexico has made significant concessions which will be really good for Canadian workers. On that basis we are optimistic,” Freeland said of the talks.

The ties between the U.S. and Canada are without parallel anywhere in the world. Trade between the two neighbors totaled an estimated $673.9 billion in 2017, with the U.S. enjoying a nearly $3 billion surplus with Canada. Each day, about 400,000 people cross the world’s longest international border. There is close cooperation on defense, border security and law enforcement, and a vast overlap in culture, traditions and pastimes.

Trudeau’s father, the late Prime Minister Pierre Trudeau, offered this take on sharing a continent with the United States. “Living next to you is in some ways like sleeping with an elephant,” he said. “No matter how friendly and even-tempered the beast, one is affected by every twitch and grunt.”

Perhaps the younger Trudeau had his father’s words in mind when he asserted that he wouldn’t let Canada get pushed around by the U.S. at a news conference at the end of the contentious G-7 summit in June—a remark that enraged Trump.

“He made this point that he’s going to make Canadians pay,” said Nelson Wiseman, a political science professor at the University of Toronto.

University of Toronto professor Robert Bothwell said the latest trade deal excluding Canada shows Trump is more focused on exerting American economic might than reaching a fair deal with friends.

“This is going to have a horrendous impact on Canada-American relations,” Bothwell said. “Canada may well have to give in to this because of the threat to the auto trade, but it’s going to leave a very bad taste.”


Crime
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Former Elkhorn couple sentenced to probation, jail in prostitution case

ELKHORN

Nine words into her statement to the judge, the teenage girl was in tears.

She spoke Wednesday morning as the victim in the case, but she asked Walworth County Judge Phillip Koss to show leniency for the defendants.

Nicole and Scott Nosek, formerly of Elkhorn but now of West Allis, pleaded guilty in July to their roles in keeping and allowing, respectively, a place of prostitution for years—sometimes when the girl was in the same place, too.

Still, the girl tearfully asked Koss not to send Scott, who was sentenced first, to jail.

“When I was away from them, I fell into, like, this really deep depression—even worse than it was before,” the girl said. “And I don’t want to fall into that hole again.”

Koss decided the Noseks each will serve three-month jail sentences, although they will have work release and the possibility of electronic monitoring from home. Koss also sentenced them to three years of probation.

All sides agreed on the probation terms. District Attorney Zeke Wiedenfeld said he would have asked for prison sentences had the girl not made her request.

A charge of party to causing mental harm to a child was dismissed and read into the record for Nicole and Scott.

Nicole, 39, also pleaded guilty to three counts of prostitution. Five others were dismissed and read in.

Koss ordered Nicole to pay $100 fines on each of the three counts, pointing out that she profited from the acts and should pay something, even if it’s “symbolic.”

Nicole charged about $50, and some of her male customers saw her at least once a week, according to the criminal complaint.

Scott, 45, told police that was the couple’s main source of income for a while. At times, he said, he was “lazy” and OK with government benefits.

He told Koss on Wednesday he has changed and is close to securing full-time employment.

Nicole’s lawyer, Christopher Kuehn, said he considered his client a victim, not a perpetrator. The men took advantage of her, he said, pointing to her physical and mental health problems.

Lawyers for both defendants—Ashley Renz represented Scott—mentioned media coverage of the case and said that was also a form of punishment.

“They can’t come back here (to Elkhorn),” Kuehn said.

Elkhorn police first discovered the case when they investigated a fire and spoke to the girl, who said Nicole had sex with strangers for money, according to the complaint.

The girl, who reportedly struggled with behavioral and mental health problems, told police one of Nicole’s clients asked if the girl could join them.

This detail caught Koss’ attention.

“Has there been an investigation into the solicitation of the second-degree sexual assault of that child? I mean, that’s what that was,” Koss said to Wiedenfeld.

Wiedenfeld said as far as he knew, the man who made that request was not specifically identified.

At this moment, Nicole began to speak, but Kuehn stopped her.

“My recollection of the reports is that, they … I don’t know that they were open about that actually occurring, with law enforcement,” Wiedenfeld said.

Scott told Koss when he found out about the request, he “completely went nuts.” Koss later said that’s how he should have reacted.

“I’m not supposed to say, ‘Thank you for not robbing banks,’” Koss said.

After Scott’s sentencing but before Nicole’s, the girl had a chance to speak again. She said she understood the jail sentence and thought it could be a good lesson.

But too much jail time for the Noseks would be hard on her, she said.

“There were days I just wanted to give up because I never thought I’d see them again,” the girl said. “Now … I feel great. I’m actually happy now.”


Nicole Nosek


Obituaries and death notices for Aug. 30, 2018

Beret R. Greenwood

Richard Glenn Kuntz

Bernadine M. “Bunny” Hipchen

Thelma Joyce Montsma

Joyce “Joy” LaVonne Papenfus

Delores A. Preston

Chad E. Steen


Business
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Rescinded tariffs represents win for U.S. newspapers

JANESVILLE

A rollback of tariffs on Canadian newsprint might not reverse harm done to the U.S. newspaper industry, but newspaper officials are feeling a sense of victory—and a promise of relief in coming months.

The U.S. International Trade Commission on Wednesday nullified tariffs the U.S. Commerce Department imposed on imported newsprint, finding that American producers weren’t harmed by imports from Canadian paper mills.

The ruling is being viewed—in Janesville and nationally—as a victory for the U.S newspaper industry, which complained that the rising cost of newsprint, typically its second-biggest expense, made it harder to operate.

In July, lawmakers testified before the commission that the tariffs were harming the very paper industry they were supposed to protect. That’s because publishers were responding to paper cost increases of 30 percent by reducing the number of pages in their newspapers. That dampened demand for newsprint, the paper used to make newspapers, books and advertising inserts.

Others testified that the higher cost of newsprint had led newspapers to cut staffing and the number of local events they cover.

Tariff opponents said a decades-long shift from print news to digital formats, not Canadian imports, have spelled a decline in demand for newsprint.

The Commerce Department imposed the tariffs in March in response to a complaint from a hedge-fund-owned paper producer in Washington state that argued Canadian competitors took advantage of government subsidies to sell products at unfairly low prices. Most newsprint used in the U.S. is produced in Canada.

By law, the trade commission must find that an industry is harmed or threatened by the imports. The commission unanimously determined in its ruling that no injury is occurring. It’s not clear whether the Washington state producer will challenge the ruling.

Members of a coalition of printers and publishers who opposed the tariffs hailed Wednesday’s decision.

Beth Bennett, executive director of the Wisconsin Newspaper Association, said the reversal is a “huge victory” due in part to opposition from newspaper publishers themselves.

Janesville Gazette publisher Skip Bliss, in a statement via the association, called it a “clear victory for the newspaper and printing industry in general.”

Bliss thanked members of Congress and thousands of newspaper readers and advertisers who he said opposed the tariffs in letters and phone calls to lawmakers.

“To me, this is a victory for America,” he said. “The newspaper industry faces a lot of challenges, and this was one of the most critical.”

Aside from tariffs, the industry continues to face a shift in reader habits and is struggling to find new advertising revenue as advertisers funnel dollars away from printed newspapers, he said.

“It’s an expensive proposition to keep people well-informed,” Bliss said. “The question is whether that becomes a value proposition in the eyes of readers.”

Tony Smithson, who oversees print operations for Bliss Communications, parent company of The Gazette, said he’s “thrilled” about the tariff rollback. Smithson and other industry officials nationwide had lobbied for the tariffs’ repeal for months.

Bliss Communications prints about 120 publications a week, including small-market daily and weekly newspapers from throughout Wisconsin and foreign language newspapers from the Chicago market.

About 119 people work at the plant.

The tariffs drove up the cost of newsprint, which affected dozens of publications, Smithson said.

Some changed print formats or downsized their dimensions or number of pages they wanted printed, he said. Those changes already had been on the horizon for some, he said, but the tariffs pushed the publications to make them.

The Gazette responded to cost increases earlier this year by using narrower paper and printing fewer articles.

Smithson called the rollback a win for smaller newspapers, which are more vulnerable to cost shifts.

“It was a lot of effort by a lot of people really detailing what the tariffs would mean, particularly to smaller, rural communities,” Smithson said. “The nature of what we do here at the print plant is we primarily serve small newspaper communities. Whether that’s a community geographically or ethnically, they were going to be disproportionately affected.”

Smithson said it could take time for some larger printing operations to clear inventories of newsprint they had to buy at higher prices.

Some price relief might occur within a few weeks. But Smithson said shifts in newsprint production under the tariffs, including one Canadian paper company that stopped producing newsprint, make it hard to predict just how much cost relief printers might see.

He said newsprint producers will be reimbursed for cash deposits from the tariffs, but print operations and news outlets affected by paper cost hikes will not be reimbursed.

It’s unclear whether newspapers that trimmed the size of their publications because of the tariffs will resume printing larger papers, Smithson said.

The Associated Press contributed to this story.


Scott Nosek