The Economy: Canada: Coping with a Twitchy Elephant

While Americans focused on Phase II of Nixon's economic program last week, other nations remained deeply distressed by the continuing aspects of Phase I—particularly the surcharge of up to 10% on their exports to the U.S. They fear that a trade war could erupt should Treasury Secretary John Connally overplay his bargaining hand and prolong the surcharge at their expense. No country has been as dismayed by Washington's measures or stands to lose as much as Canada, far and away the U.S.'s best customer and most important supplier. Prime Minister Pierre Elliott Trudeau two years ago memorably summed up the two...

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