Trending Now
We have updated our Privacy Policy and Terms of Use for Eurasia Group and its affiliates, including GZERO Media, to clarify the types of data we collect, how we collect it, how we use data and with whom we share data. By using our website you consent to our Terms and Conditions and Privacy Policy, including the transfer of your personal data to the United States from your country of residence, and our use of cookies described in our Cookie Policy.
GZERO North
What We’re Watching: Separatists go bust, Canada goes social, US readies tax retaliation
Alberta sovereigntists and supporters gather outside the Alberta Legislature on May 3, 2025.
Alberta separatists underwhelm in local election
Alberta’s separatist movement came up short in a bellwether by-election in rural Calgary on Monday, winning a disappointing 19% of the vote in Olds-Didsbury-Three Hills. Cameron Davies, leader of the separatist Alberta Republican Party, came in third, behind the governing United Conservative Party and the left-leaning New Democratic Party. Although a referendum on separatism is still in the cards, the weak showing in what was thought to be prime separatist territory suggests the movement may have little steam after all.
Canada to get its own private social network
A handful of nationalistic Canadian tech leaders provoked by Donald Trump’s threats are launching a Canadian social media platform operated independently of the American cloud. Known as Gander, it will run on Canadian servers, in line with Canadian privacy and moderation rules — meaning tighter policing of posts considered hate speech. In a unique feature, users will have the option of posting on a globally visible network or a Canada-only one. Can an upstart like this really challenge US and Chinese social media giants? We’re keen to have a … Gander.
Republicans could strip tax retaliation clause from “Big Beautiful Bill”
The Trump administration’s massive budget bill currently gives the White House the power to retaliate against other countries that impose taxes the US considers unfair. Key targets are minimum corporate tax rates and digital services taxes (like Canada’s). Top Republican officials say they will remove the clause if the EU and other countries drop or renegotiate the offending taxes. But that would need to happen by this weekend, since Donald Trump wants to sign the bill into law ahead of next week’s July Fourth holiday.
U.S. President Donald Trump, German Chancellor Friedrich Merz and NATO Secretary General Mark Rutte at a NATO leaders summit in The Hague, Netherlands June 25, 2025.
But, as the world’s most powerful military alliance moves into a new and more robust phase, here are three things to ponder.
First, this was a win for Trump.
Donald Trump’s Reality TV approach to global politics is working. The US president has leveraged his country’s awesome military power, along with his own personal unpredictability and media savvy, to command the spotlight and advance his “America First” agenda. In this world, international meetings are merely backdrops for the Donald Trump show.
At the G7 summit in Alberta 10 days ago, he wrestled control of the world’s attention by leaving early to respond to the military conflict between Israel and Iran. After bombing Iran’s nuclear facilities, he announced a ceasefire between Israel and Iran that he initially sought to manage in CAPITAL LETTERS on social media. Flying off to the NATO summit, he published an ostensibly private text message from NATO Secretary General Mark Rutte, in which the mild-mannered former Dutch prime minister flattered Trump for his “decisive” bombing of Iran and insisted the president was headed to another major triumph at the meeting in The Hague.
“Europe is going to pay in a BIG way, as they should, and it will be your win,” Rutte wrote, accurately.
Rutte in fact set up the summit as an extended ceremony of capitulation. He even called Trump “daddy” in an exchange about wrangling peace between Iran and Israel. It looked undignified, and out of step with the attitudes of European voters who are largely hostile to Trump. But it worked. The alliance is paying more for defense, and Trump now seems to be a staunch supporter of NATO again.
Note: Trump is hardly the first US president to demand that NATO members shoulder more of the alliance’s defense burden. But he is the first to get them to actually do it so decisively. The most powerful unscripted drama in the world is playing out in Trump’s favor.
Second, the rearming of Europe has begun.
Europe’s voters, accustomed to social democracies that spend a lot of money on public services, might rather their governments spend money on butter, but they have come to see that they must buy guns. Russian President Vladimir Putin’s invasion of Ukraine has made it necessary. Last year, Putin spent $149 billion on the Russian military, 7.1% of the country’s GDP, creating a vast and menacing war machine on Europe’s doorstep. And it is not possible to be confident that Russia’s ambitions are limited to Ukraine, since Russians are engaged in sabotage and disruption actions in many countries.
Could Europe contain Russia on its own? Not anytime soon. A recent study found it would take 25 years and a trillion dollars to replace the US presence that has largely kept the peace on the continent since the end of the Second World War.
But the rearmament of the continent has already begun, most swiftly in the parts closest to Russia. Poland, which has the example of Ukraine to consider, increased defense spending by 31% in 2024, to $43 billion, straining its ability to pay. Germany spent $88.5 billion in 2024, removing a legislated debt limit to do so. It is now, for the first time since reunification in 1990, the biggest defense spender in Western Europe. France spent $64.7 billion in 2024, the UK $81.8 billion. On Wednesday, they all agreed to spend a lot more.
Third, higher defense spending is a promise but not yet a reality.
Trump is mollified, arms manufacturers are cheerful, and a clear signal has been sent to the Russians, but only time will tell if NATO members will do as they have said they will. Politicians setting targets is one thing, actually spending the money is another.
After all, there is only so much money to go around and, in democracies where voters can be fickle, it may be hard for leaders to ramp up defense spending consistently over the course of a decade.
Some of them can’t even do it now: Spanish Prime Minister Pedro Sánchez showed up in the Hague with the right script, but without his checkbook, because he leads a minority government that would not be able to pass a budget if he aimed for the 5% target.
Canadian PM Mark Carney, for his part, promised Canada will hit the target, doubling its budget by 2035, but it is not clear whether voters there — or in Spain or other countries that don’t have Russian troops on their borders — will want to keep spending so much money. And by 2035, most of the current leaders will likely not be in power.
There is another wild card too: Russia. Global military spending increased at 9.4% last year, the steepest increase since the end of the Cold War, which ended when the Soviet Union ran out of money.
If history repeats itself, and Russia is unable to sustain its aggression, voters in NATO countries will no doubt find they have better things to spend on, and there will be no way to hold them to the commitments Trump won this week.
A Canadian border services superintendent, stands at the Canada Border Service Agency (CBSA) border crossing with the United States in Stanstead, Quebec, Canada
115: Canada’s border agency has opened at least 115 investigations into how suspected agents of Iran were able to enter Canada despite being banned from the country since 2022. Three individuals have been given deportation orders, and another has already been removed from the country.
1.3 billion: The US State Department has been advised by the Office of Budget and Management to end nearly all pro-democracy programs, effectively halting $1.3 billion in grants supporting pro-democracy activists or minority populations in authoritarian countries like China and Yemen.
20: The remote town of McCallum, Newfoundland, is home to just 20 people, and the youngest of them just graduated as the high school’s only student. The celebratory event has reopened conversations about the future of the town, where residents remain fiercely connected to a place and a community at risk of dying out within a generation.
800: A visit to the dentist is always a bit of a bear, but this time … quite literally. Tundra, an 800-pound Alaskan brown bear, was sedated in a northeastern Minnesota zoo and fitted with the world’s largest dental crown ever created — marking the first time the procedure has been performed on a bear.
The US-Canada relationship has hit new lows since US President Donald Trump took office in January. In the early weeks of his presidency, he not only threatened to annex Canada, but Trump also imposed hefty tariffs on key Canadian exports, including auto parts and metals, triggering a trade war across one of the most commercially integrated borders in the world. As a result, Canada’s exports to the US have plummeted by nearly 20% since Trump took office.
Here’s a look at how Canada’s southbound exports have evolved over the past decade.
U.S. Federal Reserve Chair Jerome Powell attends a press conference following the issuance of the Federal Open Market Committee's statement on interest rate policy in Washington, D.C., U.S., June 18, 2025
4: The US Fed on Wednesday held interest rates steady for the fourth time in a row, awaiting more data on the economic impact of Donald Trump’s tariff policies. Trump himself this week blasted Fed Chair Jerome Powell as “a stupid person, frankly” for not resuming the rate cuts that began last fall.
0%: Canada recorded a population growth of 0% in the first quarter of 2025, the lowest mark since 2020. This is the sixth consecutive quarter where population growth has slowed, and it comes after the federal government voted to reduce immigration levels late last year.
14 million: Canada is set to produce liquified natural gas (LNG) for the first time this weekend when a coastal facility in British Columbia begins operating. While the nearly $30-billion plant will initially operate at just one quarter of its capacity, it is expected to ultimately export 14 million metric tonnes of LNG every year. It is the first North American LNG plant with direct access to the Pacific, meaning it can serve the voracious appetite for LNG in Asia.
$100 million: Seven men were arrested in California for the “largest jewelry heist” in US history, after stealing $100 million dollars worth of gold, gems, and watches from an armored truck near San Francisco in 2022.
What we’re watching: The subnational US-Canada relationship, Golden Dome’s leaden weight, MAGA Iran crackup
Ontario Premier Doug Ford speaks during a meeting of northeastern U.S. Governors and Canadian Premiers, in Boston, Massachusetts, U.S., June 16, 2025.
Premiers meet with governors to shape US-Canada relations
While the national level drama played out between Donald Trump and Mark Carney at the G7 in Kananaskis, a lot of important US-Canada work was going on with far less fanfare in Boston, where five Canadian premiers met with governors and delegations from seven US states. The groups talked trade and tariffs, reflecting a Canadian strategy of working through deep state-level relationships to help manage the broader tensions with Trump and his policies.
The double-price Carney would pay for the Golden Dome
As he left the G7 meeting in Alberta, Donald Trump said the price tag for Canada’s participation in the US Golden Dome missile defense project would come in at a hefty US$71 billion. Trump expects Canada to join.“They want to be a part of it,” he said. But Canadians themselves aren’t so keen. A recent poll found that 63% of respondents do not want Canada to join the shield, meaning Prime Minister Mark Carney, who has expressed openness to the idea, is caught between placating Trump or siding with the skeptical majority of his constituents.
MAGA-splits over US intervention in Iran
As the world waits to see if the US will join Israel in attacking Iran – and potentially pressing for regime change – the MAGA-Republican coalition is divided. Hardcore America First voices like Marjorie Taylor Greene, Steve Bannon, and Tucker Carlson say no way, while most establishment Republicans and Democrats are still in favor. A new poll finds that while nearly two-thirds of Americans would view a nuclear-armed Iran as a threat to the US, a slim majority of Republicans want nothing to do with Israel’s current efforts to destroy Iran’s nuclear program militarily. Overall, 56% of those polled said they favor negotiations to rid Iran of nuclear weapons.
Canada's Prime Minister Mark Carney and U.S. President Donald Trump leave after a family photo session during the G7 Summit, in Kananaskis, Alberta, Canada, June 16, 2025.
The G7 meeting this week was always going to be a tricky one. Set against the backdrop of the picturesque mountains of the Kananaskis Range, the meeting also took place amid a much uglier global tableau of trade wars between the world’s largest economies, and ongoing actual wars between Russia and Ukraine, Israel and Hamas and, on the summit’s eve, Israel’s airstrikes on Iran.
All of that was in addition to other long standing agenda items like artificial intelligence, transnational crime, and climate change. And looming over the whole gathering like Mount Galatea itself: the fact that the G7 looks ever more like a G6+1 – with Donald Trump’s US at odds with most of the others on key issues.
So now that it’s over, was it a success for host country Canada and Prime Minister Mark Carney? The report card is mixed. Here are five takeaways that tell the story:
Lapel-level diplomacy: a pin-sized win
It was the lapel pin seen ‘round the world, to paraphrase former Canadian Conservative Party leader Erin O’Toole. Okay, seen ‘round Canada, at least. Arriving at the G7, Donald Trump sported a pin featuring the Canada and US flags intertwined. Although Trump was sporting a US flag pin above that, the chattering classes in Canada chose to read the hardware as a good sign that maybe the two countries are ready to go steady again after all. These days you take the wins you can get.
Trade deal pinky promise: medium-sized win with potential to upsize to large
Maybe the pin worked a little magic. After an hour-plus bilateral talk on Monday, Mark Carney announced that he and Trump had agreed to ink a trade deal within 30 days. Washington is reportedly still pressuring Canada over its dairy tariffs and digital services taxes. The president reaffirmed that he’s “a tariff person” with “a different concept” of trade from Carney, but also noted the prime minister's “more complex idea” was nonetheless “very good.”
Trump was mostly contained: big win (accomplished the near-impossible)
Avoiding any big dustup with Trump was an important goal, and that seemed to go pretty well. Despite an opening harangue from Trump about why Russia should be back in the group – Moscow was booted over its 2014 annexation of Crimea – Carney did his best, buttering up the president at a joint presser, saying “The G7 is nothing without U.S. leadership.”
It’s true that Trump left early, but it was for a good reason – to address the Israel-Iran crisis – and with no animosity. That’s an improvement from the last time Trump left a Canadian G7 meeting, splitting from at Charlevoix, Quebec in 2018 with a tweet that then-prime minister Justin Trudeau was “Very dishonest & weak.” Carney has a very different – and much better – relationship with the US president. That by itself is a W.
Resetting relations with India: a win for some a capitulation for others
Mark Carney caught a lot of flack, including protests, for inviting Indian Prime Minister Narendra Modi to the G7 meeting in the hopes of resetting Canada’s relationship with India. It was a bold move considering Canada’s intelligence agency warned just last Friday that India actively interferes in Canada’s political affairs and was involved in the 2023 murder of a Sikh Canadian in British Columbia. Nonetheless, the countries agreed to restore full diplomatic relations, including naming high commissioners, and talked about “opportunities to deepen engagement in areas such as technology, the digital transition, food security, and critical minerals.”
Working together as a group: low-hanging fruit, but little progress on the hard questions
The latter hours of the meeting produced several joint statements: members agreed on a series of measures to adopt and support artificial intelligence and quantum technologies. They also agreed to develop a critical minerals action plan, to adopt a wildfire charter, to counter migrant smuggling, and to condemn transnational repression.
But they couldn’t agree on a statement about Russia and Ukraine because of American efforts to soften the language, and had little to say on the Israel-Iran conflict beyond calling for de-escalation and re-affirming that the Iranian government mustn’t develop nuclear weapons.
Final verdict: beautiful setting, middling progress, no disasters. Overall, a qualified win for Carney, but only if he can keep the momentum up in areas that matter to Canadians.