Canadian Prime Minister Mark Carney said Canada examined the possibility of U.S. military action as an extreme tail risk while maintaining that a mutually beneficial trade agreement with Washington remains possible. In an interview with The New York Times, Carney said the scenario was not a base-case expectation but that his government had prepared for it as a matter of responsible risk management, without disclosing details. The prospect would be heavily imbalanced militarily: the United States has more than 2 million active-duty and reserve personnel, compared with fewer than 200,000 for Canada, and held 65 submarines in 2024 against Canada's four. Carney has increased defense spending since taking office, citing Canada's vast coastline and Arctic proximity. Relations have deteriorated as President Donald Trump repeatedly described Canada as the 51st state and the two countries exchanged tariffs in a trade conflict that deepened last month. Carney said he and Trump still speak frequently and that negotiations could resume, even as Ottawa pursues broader economic and strategic diversification beyond the United States.