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

Trump asserts that the United States is not obliged to sign any agreements, and moreover, could readily enter into numerous such arrangements immediately. He claims to be pursuing equitable agreements for all involved parties, while expressing indifference towards the market conditions of other nations. He indicates his team is prepared to engage in negotiations regarding the terms of an agreement, and suggests he might unilaterally implement a set of tariffs.

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

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

As part of any agreement, Trump seeks to retain some of his tariffs, asserting these import duties could yield substantial revenues for a heavily indebted federal government, despite other nations viewing the very purpose of such a deal as the removal of tariffs.

Trump recently articulated his perspective on tariffs, stating that they represent a valuable instrument. He suggested that their effective implementation would lead to substantial economic prosperity, enabling significant debt reduction and considerable tax cuts due to the anticipated revenue generation.

Thus far in the current year, the U.S. government has accrued $45.9 billion from tariffs, representing an increase of approximately $14.5 billion compared to the previous year, as reported by the Bipartisan Policy Center. These revenues have the potential to escalate considerably, considering the baseline tariffs of 10%, the 145% rate imposed on Chinese products, and rates reaching 25% on imports of steel, aluminum, automobiles, and goods from Mexico and Canada.

To achieve Trump's goals of paying back the $36 trillion debt and lowering income taxes, his tariffs would need to collect at least $2 trillion every year. This would have to happen without the economy failing in a way that reduces the total amount of tax money collected.

The Republican government has stated that 17 out of its 18 main trading partners have basically given them term sheets. These sheets list the possible agreements they are willing to make. Coming to a shared understanding of these terms would just be the beginning of any trade discussions.

However, leaders from other countries have said they are not sure exactly what Trump wants or how agreements could become lasting deals. They also know Trump approved a trade agreement with Mexico and Canada in 2020, but then put new taxes on goods from those same countries this year.

During his meeting with Trump on Tuesday, Canadian Prime Minister Mark Carney said that the next version of the agreement would need to be made stronger to stop the arbitrary fentanyl tariffs that Trump put in place this year, which Canada thought were unfair.

“Alterations are imperative in certain aspects,” Carney stated.

The 145% tariffs on China and Beijing's reciprocal 125% tariffs on the U.S. cast a long shadow over the entire negotiation. Treasury Secretary Scott Bessent concedes these tariffs are not viable in the long term.

Initial discussions between the United States and China are scheduled to commence this weekend in Switzerland, though they will probably focus on identifying methods to sufficiently reduce tensions for substantive negotiations to occur.

The central point is that China's position as the preeminent global manufacturer positions it as a major exporter, potentially displacing domestic industries elsewhere. This is exacerbated by China's emphasis on production over domestic consumption, leading other nations to absorb its output due to insufficient internal demand. While the U.S. seeks to rectify trade imbalances, its approach has included imposing tariffs on potential allies who are also striving to protect their own automotive and technology sectors from Chinese competition.

"Clearly, China represents the most significant element in this intricate trade scenario," Bessent remarked this week. "What ultimately becomes of our relationship with China?"

A spokesperson for the Chinese Foreign Ministry, Lin Jian, proposed that a constructive approach for the Trump administration to initiate negotiations would involve moderating its language and removing punitive tariffs on imports.

According to Lin, if the U.S. is genuinely committed to resolving the matter through discussion and negotiation, it ought to cease its threats and coercion and instead engage in talks with China grounded in principles of equality, respect, and mutual benefit.

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

The president further contested assertions from the Chinese government claiming his administration initiated the discussions in Geneva, remarking, "I believe they should revisit their records."

Would congressional approval be required for any agreements?

That is not necessarily the case, as there may be other factors at play.

Trump put in place tariffs on many goods by himself, without Congress, using a 1977 law called the International Emergency Economic Powers Act. This has caused several lawsuits. The government also says that they don't need Congress to agree to change the tariff rates.

In the past, presidents, like Trump with his "Phase One" China deal, could only make "smaller agreements that focused on specific trade and tariff issues between two countries," according to a government report from April. Other examples of these smaller deals are a 2023 agreement about important minerals and a 2020 deal with Japan on digital trade.

The challenge is that Trump has also integrated nontariff barriers, such as safety regulations for automobiles and the value-added taxes levied in Europe, into his discussions. He seeks reciprocal changes in other countries' nontariff policies in exchange for the U.S. lowering its recently imposed tariffs. Conversely, other nations may voice objections to U.S. subsidies offered to its corporations.

According to a Congressional Research Service report, finalising a deal addressing "non-tariff barriers and necessitating alterations to U.S. law" would, in principle, mandate the endorsement of both the House and the Senate.

Can it truly be considered a legitimate agreement if Trump simply imposes it?

Trump has indicated he may pursue domestic agreements and impose tariffs should other nations not meet his demands, a step he arguably took with the 'Liberation Day' tariffs on April 2nd. These import duties, announced by Trump, triggered a stock market decline, prompting him to temporarily suspend certain new tariffs for 90 days and apply a reduced 10% rate during ongoing negotiations.

It appears Trump will likely refrain from implementing the initially threatened tariffs if he believes other nations are offering sufficient concessions, which essentially means the U.S. is not relinquishing anything since these tariffs are recent. However, Trump could also withdraw his tariffs without necessarily receiving substantial reciprocation.

"Trump is known for initiating negotiations with highly ambitious demands, only to scale back as discussions progress, so it remains to be seen how consistently he will employ this strategy," observed William Reinsch, a senior adviser at the Center for Strategic and International Studies, a Washington think tank. "However, it is currently evident that nations expecting a conventional trade negotiation involving significant reciprocal concessions are encountering resistance.