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A trade squall blew across the northern border last week. In a sudden reversal of position, the Commerce Department declared Canada was unfairly subsidizing exports of softwood lumber to the U.S., an activity that was worth more than $2.8 billion last year. In response, the Reagan Administration said it would impose a 15% countervailing duty, which is expected to cause the cost of new U.S. housing to rise by $1,000 a unit or more.
The decision will mainly benefit lumber companies in the American Northwest, which have chafed as the Canadian share of the U.S. softwood lumber market has risen...