Trump Backs Away From 50% Canada Tariff Threat as Trade Talks Advance

President Donald Trump's decision to back away from a threatened 50% tariff on Canada sparked criticism from opponents who revived the acronym TACO, meaning "Trump always chickens out."

U.S. President Donald Trump and Canadian officials face renewed trade negotiations following Trump's threat of steep tariffs on Canadian goods.

Even some of his critics, however, acknowledge that Trump's aggressive negotiating stance helped revive more than 18 months of stalled trade talks, Megan Messerly, Daniel Desrochers and Ari Hawkins reported for Politico.

After months of fitful negotiations, Canadian and U.S. officials have made significant progress in recent weeks toward resolving disputes involving aluminum, dairy, alcohol and other key trade issues, potentially including concessions from the administration.

Canadian officials, former Democratic administration officials, business representatives and others told Politico that the progress would not have occurred without Trump's July threat to impose new and substantially higher tariffs on products including beer, furs and hockey equipment.

"This was seen as, 'Well, this is kind of outrageous, so we better pay more attention to it,'" Canadian Sen. Peter Boehm, chair of the Senate Committee on Foreign Affairs and International Trade, said.

"There was always a sense that there have to be talks, but invoking [the tariffs] did provide the leverage to do that, at 50%."

Véronique Proulx, president and CEO of the Quebec Chamber of Commerce Federation, similarly said the threat "put pressure on the Canadian government to come to the table."

The episode represents another example of Trump's negotiating strategy of using the threat of sweeping tariffs to gain leverage in trade talks.