Guest Column: The U.S. can’t stop using psy-ops as a negotiating lever. It’s just getting started
Keith Halliday
Keith Halliday is a consultant and former Canadian Foreign Service Officer. He writes the Yukonomist column for the Yukon News. The audiobook version of his most recent book Moonshadows, a Yukon-noir thriller, has just been released.
“Psychological warfare is … a continuous process… success, though incalculable, can be overwhelming; and failure, though undetectable, can be mortal.”
– U.S. Army Colonel Paul Linebarger, Psychological Warfare (1948)
Are you starting to feel like the pressure is rising? American pressure, being applied simultaneously to multiple Canadian pain points?
I do. And I also sense Canadians don’t know what to think about it, or haven’t yet twigged to what is behind all the headlines scrolling down their phone. We haven’t internalized years of mostly ineffectual Russian and Chinese info ops and have no frame of reference for what may be about to come at us – perhaps has started coming - from the United States.
Canada’s strategy of ragging the geo-economic puck while avoiding provoking the White House has minimized damage so far. But as CUSMA negotiations heat up, and if Canada fails to deliver on maximalist American demands on trade, technology and defence, the US may escalate. In which case CUSMA will no longer be a traditional trade negotiation, but a battle of national wills. The question becomes how Canadians will react to intensified US pressure, and how resilient we will be if the US imposes stiff economic costs on Canada.
Consider the warm-up acts Washington or MAGA fellow travellers are already putting on stage.
On CUSMA: “Canada-US trade talks lag behind Mexico, [US Trade Representative] Greer says” said one CTV headline.
On trade diversification deals: “Canada ‘doubling down on globalization’ at odds with US trade goals,” Global reported.
On AI: “US targets Canada’s cloud-computing move as trade irritant,” said the Globe and Mail.
On Canadian content: “US streaming industry slams Canadian rules for Canadian content investment,” the Canadian Press announced.
On defence: “‘Failed to make credible progress’: U.S. pausing long-standing military board with Canada,” said CP again.
On Alberta separatism: “Russia and U.S. amplifying Alberta separatist narratives to stoke division, distrust: report,” reported CBC.
There are common themes to find in these stories.
First, they often frame the issue from the D.C. perspective. Canada may be lagging Mexico in CUSMA talks, which undoubtedly frustrates the White House, but are we really “lagging” or just not surrendering as quickly as hoped?
Second, they often rely on Washington sources. A Canadian Press story on the recent U.S. pause on the Permanent Joint Board on Defence (PJBD) tells us that Pentagon communications officials privately briefed journalists -- mostly Canadians -- to get their message on Canadian underperformance out there. The story referred to supposed Canadian unresponsiveness to a secret Pentagon wish list and delays buying more F-35 fighters.
Third, few of the stories put the specific disputes in the context of the broader US economic and diplomatic offensive against Canada.
In the before times, the dairy dispute was just about two friendly countries squabbling about how to divide the North American milk market. Now it is about the amped-up US hegemonic approach in the Western Hemisphere, as evidenced by the new US National Security Strategy. And, more specifically, about the Trump Administration’s push to dramatically re-tilt the geo-economic playing field with Canada -- or “monetizing its hegemony” as Prime Minister Carney put it.
Put together, these stories show a US strategy that is both unwelcome and new to Canada. The Americans seem to want us to accept permanent tariffs on our goods, more Canadian market access for them, and a deliberate and public ongoing campaign to move manufacturing jobs from Canada to the US. And also to limit our trade diversification with other countries. And align seamlessly with the US AI and tech eco-system. And not just spend more on defense, but on American gear in particular and according to Pentagon directives in general.
All of which sounds great for the US. I don’t resent them for pursuing what they think of as their national interest. But I would point out that it locks us even more deeply into the role of “monitizee.”
There is a question of how coordinated all this is across a famously uncoordinated administration. When Trump Administration officials met (openly!) in DC with Alberta separatist leaders, were they also in touch with the various MAGA influencers and funders actively stoking the online fire in Canada’s energy heartland?
It doesn’t really matter. Officials and fellow travellers in any leader-driven government will “work towards the leader,” pushing hard in their own spheres to build profile and influence with the boss. The effect, for Canadians, is the same: an apparent all-fronts offensive.
Despite or maybe because of the lack of coordination, this strategy actually works in finding cracks in the victim’s defences. One living example: MAGA influencers can fund and support Alberta separatists and fill the air with misinformation.
So, what can Canadians do about all of this?
Recognize that it is happening. This piece of advice is a constant refrain of US psy-ops and info-war experts, from Colonel Linebarger in the 1940s to U.S. experts monitoring Russian campaigns in the Baltics and Ukraine today. I sometimes wonder if I am being too hysterical thinking that our neighbours in the U.S., where I have many friends and spend a lot of time, have launched a multi-front geo-economic offensive.
But then I read the papers. It’s happening.
Be honest that there will be painful trade-offs. Last year, Stephen Harper said that “I would accept any level of damage to preserve the independence of the country.”
At the time, people didn’t drill too deeply into exactly what kind of “damage” he might be talking about. The current administration has proven itself able to come up with new and previously unthinkable moves to pressure traditional allies. The damage may include not just thousands of jobs in steel, automotive, dairy, softwood and other industries, but an array of potential digital aggressions it’s probably best not to list in a document that can be read by AI tools in MAGA offices.
As I wrote in a previous Sage column, I’m not sure Ottawa fully understands the new importance of AI in all of this. Hopefully I am wrong about that, but this is more important in the long run than any individual industry. As Jim Balsillie pointed out, the new Advisory Committee on Canada-US Economic Relations is light on AI, technology and intellectual property experts.
I share Harper’s view that any price is worth paying to maintain Canada’s independence, even if it means tangling with the tech bros or suffering enough economic damage to become a case study in international relations papers on hegemonic coercion. Other Canadians may disagree. Which raises the question of how much cost we are willing to pay.
I don’t have an economic model to game this out, but the Bank of Canada’s Escalation Scenario from the July 2025 Monetary Policy Report gives us some clues. The key parameters are: the US adds a new 10% tariff on all Canadian goods not already affected by the US steel, aluminum and automotive tariffs; Canada retaliates with a 25% tariff on $120 billion of US imports.
The result is a recession lasting three quarters, with Canadian GDP at the end 1.25% lower than it would have been. This would not be a typical cyclical recession. Some Canadian industries would be permanently impaired if the tariffs remained in place.
I’m willing to pay that price. Are you?
Support the federal government in taking a muscular stance in defending Canada’s interests. This is easy to say if you are not an autoworker, or investment banker dependent on your TN-1 visa. After a generation where the national interest seemed like a quaint 20thcentury concept, I am afraid some of us are going to have to accept some punishment for the greater good.
That punishment will be unevenly spread across sectors and regions. The federal government’s response plan must lavishly support those harmed by new US policies. The rest of the country has to pay the taxes or support the federal borrowing required, while at the same time preserving fiscal firepower to support trade diversification and new industries. Tough but necessary to pull off.
Step up a broadly based civic mobilization. This step may be the most important, but the one where we seem least engaged.
Canada is a mosaic of many different regions, industries and interests. These represent thousands if not millions of close ties with US counterparts. Canadian business elites, in particular, tend to have good relationships with the cross-border barons close to the White House. Rather than each separately counselling accommodation of the particular US demands affecting them, perhaps they could speak in a unified Canadian voice.
Federal leaders are constrained in what they can say publicly by the 21stcentury version of Gibbon’s famous quote about Emperor Augustus: It is dangerous to trust the Trump Administration; to seem to distrust it is even more dangerous.
Which brings us to citizens like you. Remember Mike Myers and his March 2025 “elbows up” call? If I asked you to name the Canadian leaders outside of government most effectively speaking up for Canada in response to US pressure, who would you name? Or would you struggle to identify anyone at all?
Perhaps that vague sense of increasing pressure hasn’t crystallized for you yet. If so, wake up. The stakes are high for Canada and Donald Trump is back to his 51st state provocations.
You might ask yourself, from wherever you sit in Canadian society, if now isn’t the time for you to speak up as a Canadian then how much more serious would it need to get for you to step up.
I have not travelled to the US since the inauguration nor do I intend to in future. I buy as little American goods as possible. I have invested in a Canadian social media company that resides here and look forward to shutting down my Facebook and Instagram accounts that I have not posted to since the inauguration. I have cancelled all American streaming services. I recognize that whatever comes out of the mouths of the American administration is likely untrue and/or bully tactics. Other than voting for the right political party here that can withstand the pressure I’m not sure what else I can do. Suggestions welcome!
Certainly agreed: There is no doubt that American interests in Canada are already using psychological warfare. This is particularly true now, as you have listed. And more has in past been well documented, quietly, but nonetheless!
Canada's Long Fight Against Democracy – March 1 2024 by Yves Engler (Author), Owen Schalk (Author): is a book written by two Canadians who have well researched Canada's efforts over years to support the US to undermine other countries democratically elected governments.
Now we will see how good we are at countering such efforts against us.
Thank you, Mr. Halliday for putting the priorities.
It will be a choice for all Canadians to decide how much we are willing to belt-tighten to remain sovereign and keep our national values.
One of your readers has offered the question as to how much more he can do. My advice there would be to think of being in the Ukraine one snowy night in December, say three years ago…
There is always more to do if we think about it.
We might follow a course on civilian response in civil emergencies. Prepare for attempts to destabilize inner cities, for example during major gatherings like FIFA events. Possible attempts at sabotage to things like library computer systems, etc. Hydro disruptions due to interference.
Harder questions will make for better answers!
Suggestion: Quietly ask our friends how much they intend to, or might be willing, to sacrifice.
Are they willing to organize? Are they willing to resist force if necessary? If so, how much.
And to what degree, to make sure Canada stays strong and free?