Why Allies Give In to Trump's Demands — and Why Canada and China Won't
Key Takeaways
- •Psychologists Daniel Kahneman and Amos Tversky's concept of loss aversion helps explain why most countries have accepted less punitive tariffs rather than risk greater losses.
- •The article argues the Trump administration's unpredictability operates as a weapon, drawing on the learned-helplessness research of Martin Seligman and Steven Maier.
- •Game theory research by Robert Axelrod suggests Canada should pursue a tit-for-tat strategy, beginning with co-operation and matching any U.S. aggression with equal retaliation.
- •Canada holds significant leverage as one of the largest suppliers of crude oil, natural gas, electricity, uranium and critical minerals to the United States.
- •Prime Minister Mark Carney enjoys high approval ratings and cross-party support, and Trump is widely unpopular in Canada, strengthening the country's negotiating position.

As Yogi Berra, the master of the malapropism, famously put it, baseball is 90 per cent mental — the other half physical. Trade wars, likewise, are never purely economic. In just the past two weeks, the U.S. president has torpedoed a trade deal, threatened Canada's economic and cultural sovereignty, called Canada's leadership dishonest (and worse), and ordered a change to the name of a lake that is older than America itself.
These sudden developments make the world seem dangerous and unpredictable. Yet even as the Trump administration attacks science by cutting research funds and promoting Robert F. Kennedy Jr.'s vaccine lies, it is science that helps explain the unconscious motivations behind Trump's erratic behaviour — and how to respond to it.
Why have other countries given in?
It is worth asking why only Canada and China have so far stood up to the Trump administration's bullying. Two principles can account for the seemingly irrational passivity of everyone else.
The first is loss aversion, the concept pioneered by psychologists Daniel Kahneman and Amos Tversky, whose work on judgment and decision-making won Kahneman the 2002 Nobel Memorial Prize in Economic Sciences. Although the monetary value is identical, studies show that people fear losing a dollar more than they enjoy gaining one. Psychologically, losing something feels roughly twice as painful as gaining the same thing feels pleasurable.
For governments, the calculus is similar: the threatened loss of jobs becomes unacceptable, so countries settle for less punitive tariffs: while the current American administration is an unreliable trade partner, a 25 per cent tariff is bad and a 50 per cent one is worse.
If all of this seems chaotic, it is by design. This is not to suggest the Trump administration is intentionally random in its attacks on allies such as Canada and the European Union, but unpredictability itself is a weapon — and a second reason so many countries have acquiesced.
Animals subjected to random shocks show higher stress hormone levels than animals that learn to control the shocks; they give up and stop searching for ways to avoid pain. This learned-helplessness phenomenon, first documented by psychologists Martin Seligman and Steven Maier in the 1960s, describes what bullies rely on as well: exerting power not through constant aggression but through the imminent threat of it. The unrelenting possibility of being economically shoved into a locker with punishing new tariffs keeps trading partners on edge and uncertain, further empowering the bully.
How should Canada respond?
So what is a middle-power democracy to do? Allow American liquor back on the shelves, or threaten to withhold energy and critical minerals? Game theory says neither.
In computer simulations, the tit-for-tat strategy and its slight variations outperform far more complicated approaches. That finding comes from political scientist Robert Axelrod's famous tournaments in the early 1980s, in which simple reciprocal strategies beat far more sophisticated rivals. The idea is simple: begin with co-operation, then respond in kind to the other party's actions. Peace begets peace, and aggression is met quickly and at the same level. There is forgiveness and reciprocity; tariffs are answered with a response of equal value.
Canada is not without leverage in applying such a strategy. It is one of the largest suppliers of crude oil, natural gas, electricity and uranium to the United States, and a leading source of critical minerals — which is precisely why the question of withholding energy and minerals is on the table at all.
In the real world, Trump has threatened to escalate the conflict in January 2027 with further tariffs. Canada's message in response must be clear: it wants peace and will forgive past transgressions, but it will not tolerate future attacks.
The fallout
Whatever the response, there will be pain — though less intense and shorter-lived than if a bad deal had been accepted. While holding the line and encouraging Canadians to choose Canadian products, Prime Minister Mark Carney's government must also instil optimism in the domestic economy — and it can leverage tribalism to do so.
Humans naturally sort themselves into groups with those who look and think like them — in-group favouritism is among the most replicated findings in social psychology. For all of Canada's cultural and political diversity, many Canadians define themselves as "not Americans" and are united by indignation at the Trump administration's behaviour.
Trump himself is wildly unpopular in Canada. There is a petition to remove his confrontational ambassador, Pete Hoekstra. "Elbows Up" and Never 51 are rallying cries.
Carney has been steadfast in his protection of Canada's sovereignty; he enjoys high approval ratings and support for pausing trade talks with the Trump administration. Even politicians from other parties are pulling together to support the nation. While questions linger about who Canadians are, they are currently united by what they are not — and such unity strengthens Carney's negotiating power.
More attacks to come
Given Trump's longstanding pattern of behaviour, Canada and other historical allies can expect further erratic and spiteful attacks. As uncertain as this new world order may be, science explains the effects of this aggression and how to respond to it.
And for those who need a break from political chaos, the Blue Jays are again racing toward the playoffs.
Eric Cadesky, Clinical Associate Professor, Faculty of Medicine, University of British Columbia
This article is republished from The Conversation under a Creative Commons license.