Bessent warns Carney not to 'pick a fight' before CUSMA review
U.S. Treasury Secretary Scott Bessent warned Prime Minister Mark Carney against attacking U.S. policy ahead of the formal CUSMA review in July, as Ottawa balances trade diplomacy and Arctic defence plans.
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By Torontoer Staff
Prime Minister Mark Carney said relations with the United States are good, but U.S. Treasury Secretary Scott Bessent warned him this week not to "pick a fight" with Washington ahead of the formal Canada-U.S.-Mexico Agreement review scheduled for July. The exchange underscores growing tension as Ottawa prepares for negotiations while also stepping up Arctic defence planning.
Bessent framed his warning in a televised interview, linking public criticism of U.S. trade policy to potential diplomatic costs, and referenced Carney's background as a central banker turned politician. Meanwhile, Foreign Affairs Minister Anita Anand outlined an expanded Arctic defence posture in Ottawa, and northern leaders demanded a stronger role in planning and spending.
Bessent tells Carney not to 'score cheap political points'
Speaking to CNBC, U.S. Treasury Secretary Scott Bessent cautioned Carney against public attacks that could complicate the CUSMA review. Bessent said Canada risks undermining negotiations if the prime minister seeks political advantage in public remarks.
I would not pick a fight going into (CUSMA) to score some cheap political points, either you’re working for your own political career or you’re working for the Canadian people.
Scott Bessent, U.S. Treasury Secretary
Bessent also warned against technocrats pivoting into politics, a remark aimed at Carney’s career as a central banker. The comments came as President Donald Trump has ratcheted up tariff threats and public criticism of Canadian trade policy.
Carney keeps tone measured, says Canada will be ready
Carney told reporters entering cabinet that conversations with U.S. counterparts are constructive. He said Canada has completed its internal review for the CUSMA process, Mexico is starting its review, and the U.S. is in progress. "When it’s time to sit down at the negotiating table, we’ll be ready," he said.
Arctic defence plans move to centre stage
At the Nordic-Canadian Arctic Symposium in Ottawa, Foreign Affairs Minister Anita Anand outlined investments intended to strengthen Canada’s Arctic presence. Measures include early-warning aircraft, tactical helicopters, a satellite ground station for secure communications, and plans that could include up to 12 submarines.
The bottom line is that our Arctic presence is increasing. But make no mistake. Sovereignty is not simply about assets.
Anita Anand, Foreign Affairs Minister
Anand also noted procurement of six purpose-built Arctic and offshore patrol vessels, and she highlighted a binding memorandum of understanding between Hanwha Ocean and Algoma Steel valued at roughly $345 million for potential submarine work.
Inuit leaders and territorial premiers press for a voice and funds
Natan Obed, president of Inuit Tapiriit Kanatami, said Ottawa must treat Inuit as equal partners in planning the expansion of defence infrastructure. He warned that past Cold War-era projects were built without adequate consultation and had lasting adverse effects on northern communities.
The defence infrastructure constructed in the North early in the Cold War was built based on agreements that the Canadian government made with the U.S., and it radically changed Inuit lives by allowing the Canadian government to coerce Inuit off of our lands into settled communities.
Natan Obed, Inuit Tapiriit Kanatami
Northwest Territories Premier R.J. Simpson told premiers in Ottawa that money earmarked for Arctic projects should go to the territories. The federal budget included a $1 billion Arctic Infrastructure Fund, and northern leaders are pushing for direct territorial investment rather than routing funds elsewhere.
Diplomatic ripple effects and U.S. politics
The diplomatic fallout from U.S. rhetoric about Greenland and Arctic policy has prompted talks between the United States, Denmark and Greenland aimed at cooling tensions. In Washington, U.S. Secretary of State Marco Rubio told senators that alliance cohesion matters. "Without the U.S. there is no NATO," he said.
Back in the economic realm, Bank of Canada Governor Tiff Macklem warned that threats to the independence of the U.S. Federal Reserve are contributing to global uncertainty and could have outsized effects on Canada because of strong economic links to the United States.
I think the threat to the independence of the central bank in the United States is one thing that has sort of been contributing to this sense of uncertainty.
Tiff Macklem, Bank of Canada Governor
Domestic travel rises as U.S. trips fall
As Canadians reduce travel to the United States, domestic trips are rising. Environics Analytics data show a nine per cent increase in domestic travel in the third quarter of 2025, an additional 6.9 million trips year over year, with strong gains in Ontario, Quebec and the Atlantic provinces.
Canadians are exploring Canada more, and if you look at the numbers, it’s pretty much across the board.
Rupen Seoni, Environics Analytics
The surge in domestic travel is a secondary economic effect of strained Canada-U.S. relations and public debate over tariffs and trade policy.
Canada enters a busy stretch of diplomacy and defence planning. With the formal CUSMA review set for July, Ottawa must balance public messaging and negotiation preparedness, while northern communities and territorial governments push for meaningful participation in decisions about defence spending and infrastructure.
Mark CarneyCUSMAScott BessentArcticAnita Anand
