U.S. President Donald Trump intensified his trade war with Canada a day ahead of his August 1 deadline for a tariff agreement, saying it would be "very hard" to make a deal with Canada after it gave its support to Palestinian statehood.

The economy was supposed to crumble. The trade war was expected to escalate out of control. Markets were forecast to plunge. None of that has happened. But Trump’s early trade victory may be short-lived.

A big question in President Trump’s trade war is who will bear the brunt of the tariffs. The president and his advisers have insisted that foreign governments face the costs, not American businesses or consumers.