When President Donald Trump talks more about making deals with other countries, the situation with tariffs becomes more confusing. His team seems okay with this, saying Trump is using 'strategic uncertainty' to help himself.

Trump stated that the United States is not compelled to enter into any agreements, and could readily sign numerous such accords. He expressed a desire for equitable arrangements for all parties involved, and conveyed his indifference to the market conditions of other nations. He indicated that his team is prepared to negotiate the specifics of a pact, suggesting he retains the prerogative to unilaterally implement tariffs.

“I am finding it difficult to comprehend,” Chad Bown, a senior fellow at the Peterson Institute for International Economics, conveyed in an email.

Even though Trump's team says his book "The Art of the Deal" proves he has a big plan, many people around the world are worried. This has caused the stock market to change a lot, companies to stop hiring, and a lot of doubt, even while Trump keeps saying new factories and jobs will appear soon.

As part of any accord, Trump aims to maintain certain tariffs, asserting these import duties could generate substantial revenue for a heavily indebted federal government, despite other nations viewing the core purpose of such a pact as tariff removal.

Recently, Trump said that tariffs are good for the country and can make us much richer. He claimed that the large amount of money collected would help pay off debt and allow for big tax cuts, even more than the tax cut people are already expecting.

According to the Bipartisan Policy Center, the U.S. government has accumulated $45.9 billion from tariffs this year, an increase of approximately $14.5 billion compared to last year; these revenues have the potential to increase substantially, considering the foundational 10% tariffs, the 145% tariff applied to Chinese products, and tariffs reaching 25% on imported steel, aluminum, automobiles, and goods from Mexico and Canada.

For Trump to achieve his goals of paying off the $36 trillion debt and lowering income taxes, his tariffs would need to bring in at least $2 trillion each year. This would also have to happen without the economy failing in a way that reduces the total amount of tax money collected. Doing this would be almost mathematically impossible.

The Republican government said that 17 out of their 18 main trading partners have given them offers that show what they are willing to give up. Just agreeing on what these offers mean would be the first step in any trade talks.

However, international heads of state have expressed ambiguity regarding Trump's precise objectives and the feasibility of formalising agreements into lasting accords, particularly recalling his approval of the USMCA in 2020 followed by the imposition of new tariffs on Canada and Mexico.

During his meeting with Trump on Tuesday, Canadian Prime Minister Mark Carney said that the new version of the agreement should be made stronger. This is to stop the fentanyl tariffs that Trump put in place this year, which Canada thought were unfair, from happening again.

“Certain aspects of it will necessarily need to be modified,” stated Carney.

The high tariffs, 145% on China and 125% on the U.S., are causing problems for the negotiations. Treasury Secretary Scott Bessent said these tariffs cannot continue.

Initial discussions between the U.S. and China are scheduled to commence this weekend in Switzerland, although they will likely focus on identifying strategies to sufficiently reduce tensions to enable substantive negotiations.

The main problem is that China is the world's biggest maker of goods, which means it exports a lot and can replace local businesses in other countries. China keeps its own people from buying too much and instead focuses on making things, so other countries buy what it makes because people in China don't buy enough. The U.S. wants to make trade fairer, but it has also put taxes on goods from countries that could be its friends in protecting their car and technology businesses from China.

“Undoubtedly, in this intricate trade puzzle, China constitutes the most significant component,” Bessent remarked this week. “What will the eventual outcome be regarding China?”

Chinese Foreign Ministry spokesperson Lin Jian has proposed that a significant method for the Trump administration to initiate discussions would involve moderating its discourse and punitive import tariffs.

Lin said on Tuesday that if the U.S. really wants to solve the problem by talking and negotiating, it should stop threatening and pressuring. Instead, it should talk with China based on being equal, respecting each other, and benefiting each other.

When questioned on Wednesday about whether he would lower tariffs on China as a prerequisite for negotiations, Trump responded with a definitive "No."

The president additionally challenged the Chinese government's assertion that his administration had initiated the discussions in Geneva, suggesting they review their records.

Would congressional approval be required for any agreements?

That does not necessarily follow.

Trump put in place tariffs on many goods without getting approval from Congress. He used a law from 1977 called the International Emergency Economic Powers Act to do this, which has caused several lawsuits. The government also says that if they change the tariff rates later, they will not need Congress to agree.

Previously, presidents, such as Trump during his initial term with the “Phase One” China deal, were limited to negotiating “more confined agreements focusing on select bilateral trade and tariff matters,” as stated in a Congressional Research Service report updated this April. Further instances of limited agreements encompass a 2023 deal concerning critical minerals and a 2020 digital trade agreement with Japan.

The challenge lies in Trump's inclusion of nontariff barriers, such as automotive safety regulations and European value-added taxes, in his negotiations. He seeks adjustments to other nations' nontariff policies in exchange for a reduction in the recently imposed U.S. tariffs, which could, in turn, provoke objections from other countries regarding U.S. corporate subsidies.

According to the Congressional Research Service report, a theoretical agreement addressing "non-tariff barriers and requiring modifications to U.S. legislation" would necessitate endorsement from both the House and the Senate to be finalised.

Is it genuinely a settlement if Trump simply dictates it?

If other countries don't agree, Trump has said he will just make deals within the country and set a tariff rate, which he technically already did with his April 2 'Liberation Day' tariffs. The taxes on imports that Trump announced then caused a big drop in the financial market. This made him stop some of his new tariffs for 90 days and use the lower 10% rate while talks are happening.

It seems Trump is inclined to forgo the initially proposed tariffs, provided he deems other nations' concessions sufficient. This essentially implies the U.S. incurs no loss, given the novelty of the tariffs. Nevertheless, Trump might also rescind the tariffs without necessarily securing substantial reciprocal gains.

"Trump is well-known for initiating talks with ambitious requirements and subsequently moderating his stance as discussions progress, so the longevity of this pattern remains to be seen," commented William Reinsch, a prominent consultant at the Center for Strategic and International Studies, a think tank based in Washington. "However, it is currently quite evident that nations approaching these discussions anticipating a conventional trade negotiation with mutual significant compromises are encountering resistance."