Just in case you're looking for an opportunity to read some more about tariffs, Howard Marks has a new memo out titled "Nobody Knows (Yet Again)." In it, he talks about comparative advantage, how global trade has benefited Americans, and what this could mean for the future.

Here's an excerpt that I found interesting specifically because I've also been thinking about the parallels with Brexit:

I consider the tariff developments thus far to be what soccer fans call an “own goal” – a goal scored for the other side when a player accidentally puts the ball into his own team’s net. In this way, they’re highly analogous to Brexit, and we know how that turned out. Brexit cost the British mightily in terms of GDP, morale, and alliances, and it harmed their reputation for governance and stability. All of this damage was self-inflicted.

In the memo, he also provides an important history lesson:

To cite one more factor that has made the world a better place, I describe the behavior of the U.S. in the post-World War II period as “generosity toward the rest of the world stemming from enlightened self-interest.” Under the Marshall Plan, we gave (not loaned) billions of dollars with which Western Europe rebuilt. Likewise, between 1945 and 1952, General Douglas MacArthur oversaw the reconstruction of Japan and the strengthening of its economy. Since then, the U.S. has (a) distributed extensive foreign aid, (b) invested heavily in healthcare in developing nations, (c) created programs that bring foreign students to the U.S. and vice versa, and (d) beamed positive messages to people throughout the world. These are all instances of generosity. In each “transaction,” we gave more than we directly got, and a cynic might say we acted like suckers.

Yes, these things can be described as largesse, but as the National Archive puts it, the Marshall Plan “provided markets for American goods, created reliable trading partners, and supported the development of stable democratic governments in Western Europe.” That’s a pretty good payoff. People in other countries received lots of freebies, but certainly these programs helped the U.S. by restraining communism, bringing nations into defensive alignment with the U.S., and contributing to the U.S.’s position as the world’s most prosperous nation. I have no interest in seeing the U.S. turn isolationist.

Unfortunately, greater isolation will almost certainly be one of the consequences of Trump's tariffs. It doesn't matter that many of them have now been paused; the damage has been done. We've seen this spastic movie before. In fact, they could all go to zero tomorrow, and there would still be damage.

This is an enormous change to the world order.

Cover photo by taro ohtani on Unsplash

Neat B and I were in Park City this past weekend for our last runs of the season. (Now it's time to pull out the impossibly tight spandex for road biking!) This is a trip we do often, but given the current geopolitical situation, we weren't exactly sure what to expect. But I will say that we were pleasantly surprised. When we picked up our rental car at SLC, the attendant, who was from Texas, immediately said that he was trying to figure out how to become the next Canadian province. He then proceeded to inquire about the quality of our brisket in a way that made it sound like a firm prerequisite. And virtually everyone we met on the mountain was extremely apologetic once they learned we were Canadians from Toronto. Frankly, they came across embarrassed, and they made it clear that they do not approve of what their government is doing right now. This made us happy to hear.

I still love you, Park City.

Cover photo by Alex Moliski on Unsplash

The silver lining to the US starting a trade war with Canada and regularly threatening annexation is that it has forced this country out of complacency. Indeed, I'm hard pressed to think of a time, at least in my lifetime, when patriotism and nationalism has united so much of Canada.

According to a recent survey by Angus Reid, the percentage of Canadians expressing a "deep emotional attachment" to the country jumped from 49% in December 2024 to 59% in February 2025. And as further evidence of just how unifying this moment in time is, the province with the biggest increase in attachment to country was Québec.

What it means to be a Canadian is sometimes lazily defined according to who or what we are not. But this precarious moment in time is seemingly reminding us who we are. Of course, it also begs the questions: Where do we want to go from here? And do we have the leadership to take us there?

Let's start by looking at some, but of course not all, of the things that we have going for us as a country:

• Second-largest country in the world by land mass.

• World's longest coastline, with access to both the Pacific and Atlantic Oceans, and increasingly the Arctic Ocean.

• Third-largest proven oil reserves in the world (estimated at close to 300 billion barrels), behind Saudi Arabia.

• World's largest producer and exporter of potash (which is a key component in fertilizers).

• Energy independent and broadly rich in resources (see below diagram).

• A fifth of the planet's surface freshwater.

• Bilingual country — a quarter of the country reported using French at work in 2011 and, as of 2010, Canada had the 5th largest population of Francophones in the world (behind Morocco).

• Multi-cultural country — over 20% of Canadians are foreign-born.

• Robust immigration system that attracts top talent from around the world.

• Highly-educated workforce with some of the world's best universities — over 60% of Canadian adults have a post-secondary education which is one of the highest rates globally.

• Average life expectancy of 82.3 years (2023 data), which is about 5 years higher than that of the US.

• Leader in AI, quantum computing, green tech, and space robotics — Canada produces more AI research papers per capita than almost any other country and the Stanford AI Index (2023) ranked Canada 4th behind only the US, China, and the UK.

Here's some of our bounty (via the Financial Times):

And yet, we are not a global superpower.

Worse, we are lagging behind our G7 peers in GDP growth, we are plagued by declining productivity levels, we are not investing enough in new business creation and entrepreneurship, and we have one of the worst affordable housing shortages in the developed world, among other things. We have been complacent for far too long, and a big part of this is because we have, or at least had, the world's largest economy next door demanding our goods.

As of 2024, 61% of all imported oil to the US came from Canada. And US refineries are specifically setup to refine our crude and viscous varietal. This is good for them. They buy our goopy oil at a discount, refine it, and then sell it for a profit. But now the US is clearly saying there's nothing they need or want from Canada. They've also demonstrated through their actions that, under the current administration, they can no longer be trusted as an ally and trading partner. So it behooves us to evolve. It behooves us to take matters into our own hands.

Here are some ideas:

• Firstly, Canada should become a republic. For me, this is less about the monarchy being outdated (though it is) and more about the fact that a sovereign superpower like Canada should have its own head of state, and not a foreign King.

• Canada needs to increase defense spending and exert much stronger sovereignty over its Arctic lands. For fiscal year 2024-2025, defense spending is projected to reach 1.37% of GDP. This obviously falls short of NATO's 2% target.

• Remove red tape and unleash the Canadian economy. Last year, Canada exported more to the US than between its own provinces and territories. Huh? By some estimates, our economy could grow by up to $5,100 per capita simply by eliminating internal trade barriers.

• Barriers also need to be removed from the delivery of new housing. Canadians have been over-indexing on housing because of eroding affordability. Our current market environment is an ideal time for market reforms. Here's just one recent post that offers a few concrete suggestions for how to do this.

• Grow the Canadian population to 100 million people by 2100. Obviously there are two main ways to do this: We can help Canadians have more babies (more affordable housing certainly assists with this) and we can continue to attract the smartest and most ambitious people from around the world. As of 2022, Canada's fertility rate sat at 1.33, which is below the OECD average of 1.5 births per woman. (The above population target is the focus of a charitable organization called the "Century Initiative.")

• Create a sovereign wealth fund akin to what Norway did. Today, Norway has the largest sovereign wealth fund in the world (based on assets under management) and it translates to over US$325,000 per Norwegian citizen and one of the highest GDPs per capita on the planet. Canada also has abundant natural resources as we know. The revenues generated from these resources should (1) accrue to the Canadian population and future generations and (2) steer the global economy toward a more sustainable future.

• Invest heavily in new infrastructure. This includes everything from high-speed rail to oil pipelines. In 2020, Canada exported 82% of the crude oil it produced, with most of it going to the US via pipeline from western provinces. If the US no longer wants this, then we ought to find some new customers.

• At the same time, we cannot let our abundant natural resources become a curse (see "the paradox of plenty"). We need to be a leader in the new economy. As I've written about before, I find it shocking, for example, that Canada is not stepping up more when it comes to new technologies like crypto. Vitalik Buterin, who is one of the founders of Ethereum and its most prominent figurehead, grew up in Toronto. He went to the University of Waterloo. We should be leveraging this homegrown talent to become a capital of crypto. And this is just one specific example.

• Do everything we can to spur more innovation, more risk-taking, and more private investment. It's one thing to have great Universities that publish a lot of research, but ultimately we need to turn this into thriving companies that employ Canadians and generate wealth for Canadians. Here's a post I published in 2023 called, "Canada has an existential productivity problem."

This is obviously not a comprehensive list of all the things that Canada should be doing as a country. And invariably, some or many of you will disagree with some or most of what I have put forward here. But hopefully we can all agree that now, more than ever, we need a strong Canada. We need to start thinking of ourselves as an emerging global superpower.

Cover photo by Juan Rojas on Unsplash