May 9th, 2025
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When President Trump talks about trade deals, the situation with taxes on imports becomes unclear. His team thinks this is a good plan and calls it 'strategic uncertainty'.
Trump stated that the United States is not obligated to sign any agreements and could potentially sign many immediately. He mentioned seeking equitable deals for all parties involved and expressed indifference towards other countries' markets. He added that his team is prepared to negotiate the terms of an agreement, or he might unilaterally impose tariffs.
In an email, Chad Bown said he found it hard to understand.
Trump's team says his book "The Art of the Deal" shows he has a good plan. But many people around the world are worried. This has made the stock market go up and down a lot. Companies are not hiring new people, and many things are not clear. But Trump still says that new factories and jobs will come soon.
Trump wants to keep some taxes on goods from other countries in any agreement. He thinks these taxes can make a lot of money for the government. But other countries want to remove these taxes in a deal.
Trump recently said that tariffs are good for the country. He thinks using tariffs can make the country rich and help pay off debt. He also believes it will lower taxes a lot.
This year, the U.S. government has received $45.9 billion from taxes on imported goods. This is about $14.5 billion more than last year. This amount could increase a lot because of the different tax rates on goods from different countries.
Trump wanted to pay back the country's debt and lower taxes. He put taxes on goods from other countries to try and get money. He needed these taxes to bring in at least $2 trillion each year. This had to happen without making the economy worse, which would mean less tax money in total. It would be very hard to get this much money.
The Republican government said that 17 of the 18 countries it trades with have given them ideas for possible agreements.
But leaders from other countries said they don't know exactly what Trump wants or how to make agreements that will last a long time. They also remember that Trump made a deal with Mexico and Canada in 2020, but this year he put new taxes on goods from those same countries.
When the Canadian leader met with Trump, he said the new agreement should be stronger. This is because Trump put taxes on some goods this year because of fentanyl, and Canada thought this was unfair.
Carney said that some things about it will need to change.
High taxes on goods from China and the U.S. make the talks difficult. A government official said these taxes should not continue.
The first meeting between the U.S. and China will start this weekend in Switzerland. They will probably only try to find ways to make things calmer so they can have important talks later.
The main problem is that China makes most things in the world and sells a lot to other countries. This can make it difficult for companies in those countries. China makes many things but does not buy many things, so other countries buy what China makes because people in China do not buy enough. The U.S. wants to change this, but it has also put taxes on goods from countries that could be its friends against China.
"China is the biggest part of this trade problem," Bessent said this week. "What will happen with China?"
China says the US should speak more kindly and remove taxes to start talking again.
On Tuesday, Lin said that if the U.S. wants to solve the problem by talking, they should stop being mean and pushing China. They should talk with China as friends, with respect, and for everyone to gain something good.
Someone asked Trump if he would lower the taxes on things from China so they could start talking. Trump said, "No."
The president said his government did not ask for the talks in Geneva. He told China to look at their records again.
Does Congress need to say yes to any deals?
It's not always the case.
Trump put taxes on things from other countries by himself. He didn't ask Congress first. He used a special law from 1977 to do this. Because of this, many people have sued him. The government also says they can change these taxes later without needing Congress to say yes.
Before, presidents could only make small deals about trade, like the one Trump made with China or agreements with Japan.
The problem is that Trump also talks about other rules, like safety rules for cars in Europe and taxes. He wants other countries to change their rules if the U.S. makes the new taxes he started smaller. Other countries might not like it if the U.S. helps its companies with money.
A report said that both the House and the Senate would need to agree to finish a deal about trade rules.
Is it a good deal if Trump just agrees?
If other countries don't agree, Trump says he will make his own deals and set a tax rate. He already did this in April. These taxes made money markets go down, so he stopped some new taxes for 90 days. He is using a lower 10% tax rate while they talk.
It looks like Trump might not put new taxes on goods from other countries if he thinks they are giving enough. But Trump might also stop the taxes without getting much back.
William Reinsch, an expert, said that Trump often asks for a lot at the start of talks but then changes his mind. He said, "We don't know how long he will do this." He also said, "But now it seems that countries wanting a normal trade talk where both sides give something are not doing well."
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