Business
ESG, DEI, and the Rise of Fake Reporting
From the Brownstone Institute
By Paul Frijters, Gigi Foster and Michael Baker
We know that the modern West has developed a jaw-dropping degree of totalitarianism, wherein the bureaucracies of the state and the corporate sector coordinate together to cripple humans outside their power networks and media channels. But what are the mechanics of this coordination? To understand one of the games they play, consider the rise of measures and standards associated with DEI (Diversity, Equity, and Inclusion) and ESG (Environmental, Social, and Governance) – both occupants of a highly abstract thought dimension and the latter an especially incomprehensible word salad.
ESG as a phrase was coined in a 2006 United Nations report, gradually gaining adoption by private companies like BlackRock via the production of annual ESG reports. Governments then started supporting these voluntary efforts, and eventually began making them mandatory. Since early 2023, corporations in the EU have been compelled to report on ESG. Many US companies with subsidiaries in the EU must observe both US and European rules, and those in the Asia-Pacific region too are starting to follow the ESG reporting pantomime.
In brief, ESG originated at the level of the international and intellectual stratosphere and then grew, unchecked by tedious real-world constraints like scarcity and tradeoffs, as a kind of malignant joint venture between large government bureaucracies and large corporations.
This JV is a serious industry, offering lucrative money-making opportunities for consulting companies, fund managers, and assorted professionals who ‘help’ companies comply. Bahar Gidwani, co-founder of a company called CSRHub, a compiler and provider of ESG company ratings, estimates that the collection of ESG data alone is already costing companies $20 billion worldwide.
It is an expanding industry too, since the reporting requirements keep increasing: according to recent reports, the head of the US Securities and Exchange Commission estimates that the cost of ESG reporting by the companies it oversees could quadruple to $8.4 billion this year, primarily due to the introduction of more ESG requirements. And that’s just in the US.
Large reporting costs are easier for large companies to bear, which offers a clue to why they’re interested: this sort of burden, particularly when made compulsory by the state, helps them dominate their smaller competitors.
DEI is the younger brother of ESG. At present, DEI reporting is not yet compulsory, but about 16% of the biggest US firms have open DEI reports, and the DEI fad is growing, perhaps eventually to eclipse ESG. Just as with ESG, DEI originates from the grandiose world of fluffy abstractions, big corporations, and governments. Despite efforts to make it appear otherwise, it is not grassroots at all.
The Benign-Sounding Aims of ESG
ESG measures and reports are supposedly about gauging whether the activities of corporations are ‘sustainable,’ and especially whether companies are reducing their carbon footprints. DEI is about whether a company’s employment practices promote gender and race ‘equality,’ provide ‘safe spaces,’ and rely on global supply chains that adhere to ‘fair’ practices. Most reasonable people would agree that many of these stated goals sound worthwhile in principle. What is being advocated sounds caring and does not, on the face of it, appear to be destructive in any way.
Yet, talk is always cheap. How do these pretty ideas get operationalized when they confront the harsh reality of measurement? Let us delve into a leading example from a company report.
Grab Holdings from Singapore
Many Asian companies are ensnared in the ESG compliance system because they are listed on Western financial exchanges. One such company is the Singapore-based ‘superapp’ Grab Holdings, listed on the Nasdaq. Its customers mainly interact with Grab Holdings via a mobile phone app, where they can buy many different services (food delivery, e-commerce, ride-hailing, financial services, etc.), hence the term ‘superapp.’
Grab is unprofitable but very visible. For the first half of 2023, it lost $398 million, on top of the $1.74 billion it lost in 2022. However, it operates in businesses — particularly food delivery and ride-hailing — with serious environmental and human impacts across a vast region encompassing 400 cities and towns in eight Southeast Asian countries. To anyone living where Grab operates, its fast-moving, green-helmeted motorcycle riders are as familiar as yellow taxis are to New Yorkers or red double-decker buses are to Londoners.
Grab’s business model is inherently not great for the safety of its drivers and the public. Grab uses routing and other technology to match riders with deliveries and to minimize both wait time for drivers and delivery times to customers. Scheduling is highly efficient because of the technology, which is to say that drivers are on tight schedules with razor-thin commissions.
To make a buck, the drivers for Grab (and its competitors) have to be brave and aggressive on the road. Some are real daredevils – the Evel Knievels of Southeast Asia – as we have personally witnessed. Not only that, but there is stiff competition in each of the markets in which Grab operates. Grab itself says that 72% of its five million drivers do double duty, performing both food deliveries and ride-hailing services. This makes the company a more efficient service provider across both cut-throat businesses and gives drivers the opportunity to earn more money.
Despite the fact that it doesn’t make a profit — at least not yet — Grab splashed out to produce an ESG report that in its last iteration (2022) was 74 pages long and almost as heroic as its drivers.
The introductory pages are taken up with the usual marketing talk, replete with large photos of company motorbike drivers grinning from ear to ear because, well, they are just so grateful to be part of such a great organization. The uniforms in the photos are smart and clean, in contrast to the reality which is that the drivers’ green uniforms are almost always greasy and grubby and the drivers often look, understandably, stressed and morose.
Deeper into the ESG report, Grab gives us 5 pages on how admirably it is performing regarding road safety, 8 pages on greenhouse gas emissions, 1 on air quality, 4 on food packaging waste and 8 on inclusiveness.
Pantomime One: Road Safety
The part of the report on road safety is of special interest, since Southeast Asia’s roads have a deservedly deadly reputation for motorcyclists, and much of the mayhem is provided by the delivery drivers themselves. For example, one study in Malaysia reported that 70% of food delivery motorcyclists drivers broke traffic rules during delivery, and the kinds of violations covered the waterfront: illegal stopping, running red lights, talking on the phone while riding, riding in the wrong direction, and making illegal U-turns. The statistics on crashes involving these drivers make for grim reading.
Other studies based on rider surveys tell an even grimmer story. A 2021 survey of food delivery drivers in Thailand found that 66% of the more than 1,000 respondents had been in one to four accidents while working, with 28% reporting more than five. This squares with reputation: in countries like Thailand, where enforcement of traffic laws is the exception rather than rule, dangerous driving by two-wheelers is famously awful.
So it is with some surprise that one reads in Grab’s ESG report that there is only just under one accident for every million rides involving a Grab delivery driver. That is an incidence at least one hundred times lower than the incidence implied in self-reports. One may assume that many accidents involving delivery drivers are not reported to the company, particularly those involving no or minor injuries, or where the driver is concerned that he will lose his job.
This latter concern is not trivial, since Grab claims that it has a zero-tolerance policy toward violators of the company’s Code of Conduct, which includes failure to follow road rules. This means the count of accidents per ride is a shaky number at best. The report doesn’t really say where the company gets this number from, so it could well be made up out of thin air, though presumably whoever wrote it down had some rationale in mind. One might imagine something like “Sounds low, and dumb Westerners will believe it.”
Pantomime Two: Grab’s Strategy for Saving the Planet
After dispensing with the road safety issue, Grab’s ESG report moves on to how the company is saving the planet. The company’s greenhouse gas emissions rose during the course of the year because of ‘normalization’ after covid, but the report’s author disingenuously sidesteps the problem by saying that most of the emissions were made from vehicles that were owned by the ‘driver-partners’ rather than the company itself. So, with direct blame for GHG emissions dodged, the company’s priority is stated as to ‘support our driver-partners in transitioning to low emission vehicles and encouraging zero-emission modes of transport.’
It really isn’t clear how that fluffy ‘transition’ might come about, since conventional motorcycles are a cheap and convenient form of transport in Southeast Asia, easily outcompeting other available options for the coal-face work required by Grab’s business model. The report says it will encourage cycling, walking, and EVs. The first two are obviously out of the question in most instances for food delivery, and as for the third, for the overwhelming majority of two-wheeler drivers, upgrading to an EV is a pipe dream (or pipe nightmare, depending on how much they know about EV recharging, weight, and maintenance issues).
One of the beauties of Grab being a platform that connects eateries with drivers without actually operating restaurants itself is that – as with GHG emissions – food packaging waste isn’t really Grab’s direct responsibility. It is the responsibility of the restaurants and food manufacturers, like the owners of the factories that make all those nasty little sachets of ketchup, soy sauce, and other condiments.
Brilliant! With this sleight of hand squarely in frame, this part of the ESG report then writes itself as an exercise in hand-wringing, admitting with furrowed brow that food packaging waste is a serious problem, and stating that the company’s goal is ‘Zero packaging waste in Nature by 2040.’ Exactly what this means and how it is to be accomplished is shrouded in mystery, but to anyone whose beach holidays have ever been marred by the ugly sight of plastic litter on the shoreline, it sounds awfully good.
Pantomime Three: Equity, Diversity, and Inclusion
Most of this section of the report consists of descriptive marketing: saying all the right things and showcasing the occasional shining example, without getting into too much detail. The main statistics given are that 43% of Grab’s employees are women and 34% of those in ‘leadership positions’ are women. Well, maybe that could be true if one counts the few thousand direct employees, including a lot of secretaries, but omits the five million ‘driver-partners’ who are overwhelmingly male. The report also says that female employees earn 98% of what men do, which presumably means that the odd male secretary is treated just as badly as his female colleagues.
This section of the report showcases other inventive labeling. We are told the company has ‘Inclusion Champions,’ collectively a group of employees who ‘contribute to inclusion through crowdsourcing of ideas and on-ground feedback for better inclusion initiatives. They also help to identify and coach fellow Grab employees towards more inclusive behaviour, and will co-drive projects that help drive inclusion.’ Who knows what that really means? One might guess that ‘crowdsourcing ideas’ is the new term for having a suggestion box, and that pretty much every email sent by HR can be contrived to be a form of ‘inclusive’ coaching.
Grab’s report thus seems like it addresses ESG- and DEI-related issues, but no real-world mechanism ties them to actual outcomes, and there is no realistic external verification. Even seemingly simple things, like counting how much fuel a company buys directly for its processes and thereby estimating the size of its ‘carbon footprint,’ are like child’s play to game, as demonstrated by Grab’s masterly reporting: simply forcing workers and subsidiaries to buy their own fuel (compensated via higher wages or other things) will make the footprint of the company itself seem dramatically lower, while requiring nothing substantial to change. It’s all an elaborate show.
Who’s Asking for This Crap?
Though specious, unverifiable, and mostly made up, ESG reporting is a way to formally present a company’s ‘ESG performance.’ This performance can theoretically be ‘scored’ by some third party, and thereby compared with that of other companies. If ESG is valued highly by consumers, then companies that get high scores should attract a disproportionate amount of investment, meaning that their cost of capital will be lower than companies who don’t score so well – the magic through which a bullshit report is turned into a business opportunity.
This also makes delicious fodder for fund managers, who can bundle firms’ stock into ‘ESG funds’ or ‘sustainable funds’ or whatever, and charge investors fat fees for the privilege of investing in them. Fund managers also have another motivation to egg on more ESG reporting: their funds are designed not to green the world or make it a nicer place, but rather to highlight which companies will adapt best and thrive the most in a world where ‘progress’ toward ESG goals (for example, ‘net zero’) is actually being made.
How big is this market? According to Morningstar, by the end of the third quarter of 2023, global ‘sustainable’ funds numbered more than 7,600, of which nearly 75% were in Europe and 10% in the US. These funds had assets of $2.7 trillion. However, global inflows into these funds have been falling sharply since the first quarter of 2022. While they have still been attracting more inflows than non-sustainability funds in Europe, this is not true in the US. Amid waning interest in the US, fewer and fewer new ESG funds are being launched, and in 3Q2023 there were more ESG fund exits than new arrivals.
During the first two years of covid, American ESG stocks outperformed conventional stocks by a wide margin. This is not surprising since technology companies did rather well out of lockdowns, and they also have high ESG scores because of their lower carbon footprints than miscreant ‘old economy’ companies. Still, since the start of 2022, ESG stocks have fallen back and now are only just edging the market. Indicatively, in the seven quarters ending September 30, 2023, the S&P ESG Index was down 7.3%, while the S&P 500 was down 9.4%.
Importantly, many ESG fund investors themselves are government-type entities, like public pension funds, where the distance between investment decision and personal consequence is about as big as it gets. So often the ultimate payers for this circus are the general population whose pensions are, unbeknown to themselves, being used for virtue-signaling by public fund managers.
Who Wins and Who Loses?
Learning how to write up and cheat with these performance reports requires a lot of resources, but once a company antes up, the game becomes easy to play. ESG reporting is just one example of the broader reality that compliance with external bureaucracies requires largely a one-off fixed cost, and in this case the cost is often large enough to bankrupt a small firm. This means that, just as bizarre covid-era rules were a gift of competitive advantage to big companies, ESG and DEI reporting is a mechanism through which big companies can pressurize and even get rid entirely of smaller ones.
This, we think, is the reason why bullshit reporting is not getting pushback from the largest companies that don’t already have natural monopolies: plainly, it suits their purposes. They are big enough to absorb the cost without a major effect on the bottom line, and they are getting in return a stronger position in their markets. They naturally support the big bureaucracies that make these reports compulsory. Big consulting companies, and the aforementioned fund managers, also love the idea of compulsory reporting because it creates business for them.
On this very issue, Michael Shellenberger opined recently on Tucker Carlson’s channel that big traditional energy companies were led by cowards who had been “bullied into submission:” that the ESG movement had “used political activism and the pension funds to put pressure on the oil and gas industries to basically sell out their main product.” He called the ESG movement an “anti-human death cult” and asserted that “it’s finally becoming obvious to people that it’s a scam.”
On the lattermost point, we hope he’s right.
Yet, the scam is still spreading, as there are plenty more unproductive people eager to climb aboard. The push for companies to jump on the ESG reporting bandwagon is not confined to the West. Regulators in Asia are also pushing — harder in some countries, like Singapore, than in others — to make ESG reporting mandatory rather than optional. Sensing a huge opportunity to divert valuable resources their way, a posse of consulting firms are also coming after companies to advise them on how they can bridge the ESG gap with the more advanced West. Companies in Asia are starting to fall in line and dutifully churn out their ESG reports, breathing more life into the scam.
Will This Eventually Crash and Burn?
Hard-nosed managers of big firms understand that bullshit reporting requirements can be a source of competitive advantage, causing financial distress for their smaller competitors. What is in the whole charade for the state bureaucracy and the corporate bureaucracy is that it makes them seem virtuous while creating a huge fog of mystery about what they are actually doing, thereby providing both jobs and cover.
Like the woke movement, ESG and DEI are at heart parasitical developments, originating from a decaying West, championed by the useless and the clueless, and benefiting the shrewd and the corrupt.
Such malignancies weaken our society and should be discarded at the earliest opportunity. Much like Elon Musk showed the door to 80% of Twitter staff with no loss of functionality, and just as we have advocated previously that 80% of employment in ‘health’ professions is useless, so too do we think that firing all professionals whose primary business involves ESG and DEI can be done without any loss of functionality. We don’t think this will happen anytime soon.
If it were to happen, what would one do with all those unproductive workers who have been dining on the ESG/DEI word-salad gravy trains for months or years? Paying them to paint rocks for a while would at least get them out of the way. Better still, taking a cue from what the Ontario College of Psychologists has suggested recently for Jordan Peterson, these people could be taken into the field to help communities struggling with actual problems, involving actual trade-offs, as part of a reeducation and retraining program aimed at making them useful to their societies once again.
Business
Judge Declares Mistrial in Landmark New York PRC Foreign-Agent Case
U.S. District Judge Brian Cogan declared a mistrial Monday afternoon in the high-profile foreign-agent and corruption case against former New York state official Linda Sun and her husband Chris Hu, after jurors reported they were hopelessly deadlocked on all 19 counts.
After restarting deliberations Monday morning with an alternate juror, the panel sent a note to Judge Cogan stating:
“Your honor, after extensive deliberations and redeliberations the jury remains unable to reach a unanimous verdict. The jurors’ positions are firmly held.”
Cogan brought the jury into court and asked the foreman whether they had reached agreement on any counts. They replied that they were deadlocked on every one. The judge then declared a mistrial.
Assistant U.S. Attorney Alexander Solomon immediately told the court that the government intends to retry the case “as soon as possible.” A status conference is scheduled for January 26, 2026, to determine next steps.
Jury selection began November 10, 2025, and the government called 41 witnesses to the stand, compared with eight for the defense and one rebuttal witness for the prosecution. Deliberations began on December 12, and by this afternoon the jurors had sent three notes to the court — each indicating deadlock.
As The Bureau reported in its exclusive analysis Friday, the panel’s fracture had become visible as jurors headed into a second week of deliberations in a landmark foreign-agent and corruption trial that reached into two governors’ offices — a case asking a jury of New Yorkers to decide whether Sun secretly served Beijing’s interests while she and Hu built a small business and luxury-property empire during the pandemic, cashing in on emergency procurement as other Americans were locked down.
Prosecutors urged jurors to accept their account of a dense web of family and Chinese-community financial transactions through which Sun and Hu allegedly secured many millions of dollars in business deals tied to “United Front” proxies aligned with Beijing. The defense, by contrast, argued that Sun and Hu were simply successful through legitimate, culturally familiar transactions, not any covert scheme directed by a foreign state.
Sun and Hu face 19 charges in total, including allegations that Sun acted as an unregistered foreign agent for the People’s Republic of China; visa-fraud and alien-smuggling counts tied to a 2019 Henan provincial delegation; a multimillion-dollar pandemic PPE kickback scheme; bank-fraud and identity-misuse allegations; and multiple money-laundering and tax-evasion counts.
Prosecutors have argued that the clearest money trail ran through New York’s COVID procurement scramble and a pair of Jiangsu-linked emails. In closing, Solomon told jurors that Sun’s “reward” for steering contracts was “millions of dollars in kickbacks or bribes,” contending the money was routed through accounts opened in Sun’s mother’s name and via friends and relatives.
The government has tied those claims to a broader narrative — laid out in Solomon’s summation and dissected in The Bureau’s reporting — that Sun functioned as a “trusted insider” who repurposed state access and letterhead to advance Beijing’s priorities, including by allegedly forging Governor Kathy Hochul’s signature on invitation letters used for Chinese provincial delegations, while keeping those relationships hidden from colleagues. The defense, in turn, urged jurors to reject the government’s picture of clandestine agency and argued prosecutors had overreached by treating ordinary diaspora networking, trade promotion, and pandemic procurement as criminal conduct — insisting none of the evidence proved the “direction or control” element central to the Foreign Agents Registration Act.
Whether a future jury will see the same evidence as corruption and covert foreign agency or as culturally familiar commerce and politics — will now be tested again, on a new timetable, in a courtroom that has already shown just how difficult this record is to unanimously interpret.
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Business
The “Disruptor-in-Chief” places Canada in the crosshairs
Not for the first time, the Macdonald-Laurier Institute’s Policymaker of the Year is not a Canadian.
In 2019, our laureate was Xi Jinping, leader of the People’s Republic of China, whose long arm reached far into many aspects of policymaking in our nation’s capital.
That helps to underline our intention in conferring this recognition. Policy influence can be used to Canada’s benefit or detriment. In naming our annual Policymaker of the Year, MLI does not endorse their policies; instead, we seek to draw to the attention of Canadians those people who have had the most influence on public policy in this country – for good or ill – in the past year.
And in 2025, who can deny that US President Donald Trump, the Disruptor-in-Chief, has exercised an outsized influence on Canadians – on their hopes and fears, on their political preferences, and, most importantly for our purposes, on the policies pursued by the Canadian government?
How has Donald Trump spurred policy change in Canada? Let us count the ways:
First, set aside for the moment any focus on specific policy areas and just think about the President’s style and strategy. Anyone who has read The Art of the Deal knows that Trump is quite straightforward in avowing that his dealmaking strategy sets out to frighten and intimidate the other party with a degree of unpredictability, bravado, and unwillingness to be bound by past assumptions that is sometimes just breathtaking to contemplate.
On the other hand, what on the surface appears to his opponents as simply irrational is in fact nothing of the sort. He sets out to frighten and intimidate, but he also sets out to get deals done, which cannot happen with negotiating partners paralyzed by fear. And in fact, the list of deals he has done in less than a year in office is impressive: NATO members have made big commitments to increase defence spending, the war in Gaza is paused by a (shaky) ceasefire of his design, trade deals have been struck with many partners, including the EU, the UK, Mexico, and even China … though notably, not with Canada.
Here at home, Trump has riled Canadians with his comments about annexation and disputed borders, laid a heavy finger on the 2025 electoral scales, and met repeatedly with Prime Minister Mark Carney – but equally repeatedly sent him on his way with little to show for the Prime Minister’s efforts as supplicant. Policies that seemed settled, like our purchase of the F-35 fighter jet, our deep integration with the US economy, and our feeble attempts at even-handedness in the conflict in the Middle East, all seem to have fallen victim to Ottawa’s ill-advised urge to stick a finger in Donald Trump’s eye, whatever the cost.
Like it or not, Trump has reminded Canadians in no uncertain terms that America is the elephant and we are, if not exactly a mouse, certainly a beast whose wellbeing depends on American forbearance and good will. The question of whether we can calm the rampaging elephant and charm him into a better humour or fall back on much less profitable relations with other countries far away is THE question that will preoccupy policymakers in Ottawa this year and for several years to come.
It is against this backdrop that several major dimensions of Canada-US relations have been thrust into the spotlight – none more dramatically than trade.
Weaponized Tariffs and Fractured Trade
Tim Sargent
For many Canadians, Donald Trump’s re-election on November 5, 2024, while not a cause for celebration, was also not an existential threat to our economy. After all, when Trump was first elected in 2016, his threats to tear up the North American Free Trade Agreement (NAFTA) ultimately came to nothing, and the new version of NAFTA that was negotiated by the US, Canada, and Mexico (we call it CUSMA, the Americans call it USMCA), was broadly similar to its predecessor, with almost all Canadian goods able to enter the US market tariff-free.
That complacency was almost immediately shattered when the President, even before his inauguration, announced his intent to slap a tariff of 25 per cent on Canadian (and Mexican exports), supposedly in response to Canada’s failure to stop fentanyl from crossing over the US border. The shock was rapid, and the implications unmistakable.
Once in office, Trump made good on his threat and imposed the 25 per cent tariff on all Canadian exports except energy, which was subject to “only” a 10 per cent tariff. The sheer interconnectedness of the North American economy forced Trump to partially back down and exempt CUSMA-compliant goods from the tariffs. However, because they raised input costs for US manufacturers, Trump opened another front by slapping tariffs on steel, aluminum, autos, copper, lumber, and furniture in the name of national security, overriding the CUSMA treaty that he had signed. While these tariffs apply to all countries, these are all commodities for which Canadian exporters are very dependent on the US market, and which are very important for the Canadian economy.
While trade disputes with the US have not been unknown since the signing of the original Canada-US Free Trade Agreement in 1988 – softwood lumber is the most obvious example – no one expected Trump to take aim at the whole Canada–US trading relationship, which accounts for almost a quarter of our GDP. This escalation marks a break not just with economic norms but with decades of strategic restraint.
None of this augers well for the negotiations for the renewal of CUSMA, which are supposed to conclude in the summer of 2026, or the broader Canada-US trading relationship. Indeed, it is not clear that the renewal document will be worth the paper it is written on, given that Trump has shown no compunction in violating the terms of the original agreement. Perhaps even more fundamentally, the President, reflecting a broader strand of America-first nationalism, simply does not see trade as a mutually beneficial activity; rather, it is a zero-sum game in which the only way for the US to win is for others to lose. The fact that basic economics says the opposite seems to be neither here nor there.
All this leaves Canadian policymakers with some unpleasant alternatives. While the Carney government originally attempted to retaliate by imposing tariffs of its own, the reality is that these are pinpricks to the US, for which Canadian exports are only a few percentage points of GDP. Furthermore, tariffs hurt Canadian consumers. The other alternative, which the government is now pursuing, is to diversify Canada’s trade away from the US. However, Canadian governments have been trying to reduce their reliance on the United States since at least the 1970s, with little success. Geography and economic gravity continue to dominate: the US will always be the most obvious market for our exports, even with tariffs.
Perhaps the most that Canadians can hope for is that Americans will, as has happened in the past, come to realize that a close and stable trading relationship with Canada is in their national interest just as much as it is in ours.
Trade Tensions Fuel Canadian Oil Revival
Heather Exner-Pirot
Donald Trump’s tariffs and threat to the Canadian economy have meaningfully shifted both the public understanding and attitude towards oil and gas. Perhaps in the past it could be seen simply as something Alberta produced, an embarrassing source of global emissions. After 2025, it became clear how essential oil production is both to our economic health and our global standing.
Oil is Canada’s largest export, and most of it goes to the United States. When Trump declared in January 2025 that “we don’t need their oil and gas. We have more than anybody,” it was a tell. Canadian oil and gas is precisely the thing we produce that the United States needs more than anything else. In fact, that same month the US imported a record amount of Canadian crude oil: 4.27 million barrels; the most any country has ever imported from another in the history of the world.
This newfound appreciation of oil and its geopolitical importance brought a long-dead idea back to life: an oil pipeline to the northwest coast of British Columbia, the value of which has always been in diversifying our market for heavy oil from the US to Asia. The source of hard fought culture wars in the 2010s before being approved in 2014, rejected by Trudeau in 2018, and handed the final indignity of a tanker ban in 2019, a Northern Gateway-type pipeline is now not only possible, but even likely. In every public opinion poll in 2025, such a pipeline has enjoyed majority support. It is the centrepiece of the landmark MOU between the federal and Alberta government that has as an explicit goal increasing oil and gas production.
Canada has always had the resources of an energy superpower. Trump’s threats have done more to give us the ambition of one than anyone or anything before him.
“Elbows up” and the New Anti-American Nationalism
Mark Reid
Donald Trump’s return to the White House drastically altered the course of Canadian politics. The ensuing fallout – fuelled by threats of tariffs and incendiary “51st state” rhetoric – became the key catalyst that propelled Mark Carney’s Liberals to victory on an “elbows up” platform.
This resurgent Canadian nationalism was defined by a sharp strain of anti-Americanism in general, and a profound dislike of Trump in particular.
As Trump slapped tariffs on Canada (and mused about annexing Greenland), the Prime Minister and provincial leaders promised a “Team Canada” approach to counter the President’s aggression. Canadian politicians from coast to coast earnestly vowed to remove interprovincial trade barriers, back major national projects, and present a common front.
That unity quickly faded.
Faced with new rounds of tariff threats, Carney’s government shifted to diplomatic conciliation, rolling back the Digital Sales Tax and offering border security concessions to avert economic disaster. Supporters called it pragmatism; critics called it a surrender.
Meanwhile, the Team Canada vision turned out to be a mirage. Interprovincial squabbles over a bitumen pipeline to tidewater in BC persists, while a multi-million-dollar Ontario anti-tariff ad, which aired on US television, infuriated Trump.
These internal divisions underscore a dangerous reality: Canada’s very sovereignty may be at risk. The US President’s recent “Trump Corollary” to the Monroe Doctrine clearly articulates his vision of American hegemony over the Americas, with Canada, presumably, as a sort of vassal state. The federal government now faces an impossible task – buying time in the hope that the US political climate shifts, while protecting Canadian autonomy from an American president who sees it as negotiable.
Smashing the Overton Window on social policy
Peter Copeland
Donald Trump is polarizing for good reason. He is rude, crude, lewd, and norm-breaking to an extraordinary degree: a former Manhattan Democrat and social liberal whose transgressiveness and contempt for precedent embody many of the very cultural tendencies the left has long celebrated. His impulsiveness seems to threaten alliances and raise geopolitical risks by the day – yet he now leads the most effective conservative movement in decades.
He also possesses unusual strengths. His entrepreneurial instinct has allowed him to see the gap created by an oblivious, or unwilling, left- and right- establishment political class on trade, immigration, cultural and social decline – and to seize the opportunity. His unfiltered political style contrasts sharply with the scripted, risk-averse habits of career politicians and the professional-managerial class. He seeks no validation from the Davos set or the media-academic establishment, making him unafraid to challenge orthodoxy. Trump’s rise is a sharp indictment of liberal elites on both sides of the political spectrum, who proved incapable of addressing the deep social and economic issues that he foregrounded from the outset of his presidency.
On issues like gender identity, DEI, and mass migration, rooted in an extreme open-society ideology of hyper-individualism and autonomy, establishment leaders had long been unwilling even to acknowledge the problems. Then Trump came along and threw open the Overton window on just about every issue.
For Canada, Trump’s impact is mixed. He expanded the envelope of the politically possible on topics thought untouchable just years ago, but his abrasive style has made Canadian elites – whose defining characteristic is anti-Americanism – more reluctant to pursue parallel reforms. On immigration, borders and defence, Ottawa is now moving; on gender, DEI, and education, it is retreating behind “Trump did it, so we won’t.”
Shredding Canada’s US security blanket
Richard Shimooka
President Trump’s successful upending of American foreign policy in 2025 has had profound and potentially long-term consequences, but few are as acutely felt as the changes he has forced upon the Canada-US security relationship. Trump’s actions have effectively ended the decades-long expectation that the United States would forever underwrite Canada’s defence and security, forcing a sea-change in Ottawa’s strategic calculus.
Since the Second World War, the foundation of the Canada-US security and economic relationship has been an interlocking system of security guarantees through alliances and free trade blocs. This synergistic mix, which bound states like Canada to a rules and values based international order conceived in Washington, allowed Canada to maintain a relatively small defence footprint, relying instead on overwhelming American firepower to deter its enemies.
However, Trump’s skepticism towards this foundation, evident since his first term, consolidated into decisive policy changes in his second term. By launching a devastatingly counterproductive trade war against Canada and other major trading partners and directly questioning the value of major alliances like NATO, he effectively declared America’s security commitments are no longer unconditional.
For Canada, this has meant a new urgency to foot a larger portion of the bill for continental security, a renewed focus on securing both the Canada-US border and the Arctic, and for finally meeting long-standing pledges to spend two per cent of GDP on NATO.
Ironically, while Trump’s pressure tactics have succeeding in pushing Canada (and other allies like Japan and Germany) to increase defence spending and become more self-sufficient, it comes at the cost of America’s ability to lead like-minded states. As US leverage wanes, Trump’s strategy may end up pushing America’s allies into the arms of strategic rivals like China.
Without American global leadership, states may prioritize a narrower brand of self-interest – one that is counterproductive to America’s overall strategic ends. Observe how Canada is now looking to rebuild its economic relationship with the People’s Republic of China, not merely for trade, but as a deliberate economic counterweight to its highly integrated trade relationship with the United States.
This impulse will likely be shared by many US allies. Indeed, allied nations in Southeast Asia may begin to doubt Washington’s commitment to the current geopolitical alignment and seek to balance their relationship with China. Some may even fall further into Beijing’s grasp, becoming the 21st-century equivalent of tributary states.
“Trump the Peacemaker” and the Politics of Force
Casey Babb
Donald Trump’s bold and fearless foreign policy decisions – especially regarding Israel’s war in Gaza and the broader Middle East – make him one of the most consequential and transformative political leaders in a generation. His combination of disruption, recalibration, and strategic risk-taking sought to redirect the trajectory of the Middle East in ways few leaders have attempted.
Some of these changes began during Trump’s first administration. The Abraham Accords, which normalized relations between Israel and several Arab states, reflected a shift toward open regional co-operation against shared security concerns. His decisions, like recognizing Jerusalem as Israel’s capital and cutting aid to Palestinian institutions, were commonsense corrections to what he viewed as unnecessary diplomatic ambiguities.
However, his most transformative actions in the Middle East happened in the aftermath of the October 7, 2023, Hamas terror attacks on Israel. From his 20-point plan for peace in Gaza and his efforts to bring home hostages, to the “12 Day War” between Israel and Iran, Trump made it clear that America’s support for Israel remains unwavering – signalling that Washington is willing to take decisive action in the Middle East to protect US and allied security.
Beyond the Middle East, Trump’s approach to China marked a sharp departure from previous presidents. Replacing engagement tactics with tariffs, export controls, and the framing of China as a key rival, Trump pushed for a shift in US policy that continues in his second term in office.
In Europe, Trump’s record on the Russia-Ukraine war is mixed. The President has pressured NATO allies to carry a greater load in terms of supporting Ukraine, and the US has continued to provide Kyiv with lethal military aid. However, critics worry about Trump’s personal relationship with Russian President Vladimir Putin: as the peace negotiations continue, will Ukraine eventually be sacrificed for American expediency?
Conclusion
Trump’s legacy remains unwritten. It may destabilize Western institutions, or it may be the jolt needed to shake a complacent boomer establishment out of its decadent, dogmatic slumbers.
Trump has clearly shifted the geopolitical landscape in both Canada and around the world – in ways no conventional figure could have. It is worth asking: would Europe have increased defence spending without American pressure? Would Canada have taken border security, immigration, defence, or energy policy seriously?
Even conservative governments – often differing little from liberal ones in practice – have lacked the capital or resolve to confront entrenched bureaucracies, and it remains doubtful whether any old-school Canadian libertarian-oriented fusionist, or a typical Wall Street Republican in the US, would have had what it took to win, yet alone enact the needed the reforms.
Trump was, and is, very much the man for the moment. Whether this shift leads to renewal or decline, only time will tell. Those same disruptive instincts have defined his approach to the world stage as well, reshaping geopolitics in ways Canadians cannot ignore.
Brian Lee Crowley is managing director of the Macdonald-Laurier Institute.
Tim Sargent is a senior fellow and the director of Domestic Policy at MLI.
Heather Exner-Pirot is a senior fellow and MLI’s director of Energy, Natural Resources, and the Environment.
Mark Reid is the senior editor at MLI.
Peter Copeland is the deputy director of Domestic Policy at MLI.
Richard Shimooka is a senior fellow at MLI.
Casey Babb is the director of MLI’s The Promised Land program.
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