By Josh Bork
WASHINGTON (AP) — The more President Donald Trump talks about his efforts to reach a deal with his American trading partner, the more tariff photos come. His team seems good at that, and Trump says he uses “strategic uncertainty” for his profit.
Trump said the US does not need to sign a contract and can now sign 25 cases. He says he is looking for fair deals in all respects and doesn’t care about the markets of other countries. He says his team could sit down to negotiate terms of the contract and might impose a set of tariffs himself.
“I have a hard time figuring out that,” wrote Chad Bowun, a senior fellow at the Peterson Institute for International Economics, in an email.
Trump’s team holds his bestselling book, The Art of the Deal, as evidence that he has a master plan, but much of the world is found in Tenterhook. That means volatile stock markets, job freezes and uncertainty of all sorts, despite Trump continuing to promise new factories and jobs to be on the horizon.
See how the trade talk unfolds:
Trump still wants tariffs
As part of the deal, Trump wants to maintain some of his tariffs. He believes import taxes can generate large federal revenues that are greatly benefiting, despite seeing the overall point of other countries getting rid of tariffs and hitting contracts.
“They’re beautiful to us,” Trump recently said of tariffs. “If we can use them, if we can get away with them, it will make us very rich, and we will pay off our debts.
So far, the US government has raised $45.9 billion from tariffs about $14.5 billion more than last year, according to the Bipartisan Policy Center. These revenues can escalate sharply considering a 10% baseline fee, with 145% charges being charged to Chinese goods and 25% on steel, aluminum, automobiles, Mexican and Canadian imports.
To meet the goal Trump stated to pay off $36 trillion in debt and cut income taxes, his tariffs will need to raise at least $2 trillion a year without the economy crashing in a way that reduces overall tax revenue. That would be close to mathematical impossible.
How does negotiation work?
The Republican administration says 17 of the 17 major trading partners have essentially presented term sheets. Agreeing with mutual understanding of terms is merely the beginning of trade consultations.
But foreign leaders say it’s unclear what Trump wants and how the deal can be codified into a durable agreement. They also know that Trump approved the US-Mexico-Canada agreement in 2020, but only to charge new tariffs from the same two trading partners this year.
During his meeting with Trump on Tuesday, Canadian Prime Minister Mark Carney proposed that the next version of the agreement should be strengthened to prevent repeated fentanyl-related tariffs imposed by Trump this year.
“Something about that will have to change,” Carney said.
Can the US reach a deal with China?
The 145% tariff on China, and the 125% tariff on the US, which Beijing imposed accordingly, remained throughout the negotiation process. Treasury Secretary Scott Bescent acknowledges that these tariffs are not “sustainable.”
The first talks between the US and China, which is expected to begin in Switzerland this weekend, will be limited to finding ways to eliminate enough tensions to allow meaningful negotiations to take place.
The key issue is that China is the dominant manufacturer of the world and becomes a major exporter in an alternative way to domestic industries. As China is focusing on domestic consumption and production, other parts of the world buy what it makes because there is no sufficient internal demand. The US wants to readjust trade, but it does so through tariffs from countries that may be a natural ally in protecting the automobile and technology industry against China.
“Obviously China is the biggest piece of work in this trade puzzle,” Bescent said this week. “Where are you going to China?”
China’s Foreign Ministry spokesman Lynn Jiang suggests that a meaningful way for the Trump administration to surge in talks is to pull back its rhetoric and punitive import taxes.
“If the US really wants to resolve issues through dialogue and negotiations, it should stop dialogue with China by putting threats and pressure on equality, respect and mutual interest,” Lin said Tuesday.
Asked on Wednesday if China’s tariffs would be reduced as a condition for negotiations, Trump said “no.”
The president also challenged the Chinese government’s statement, claiming his administration has called for consultations in Geneva. “Well, I think they should go back and study the files,” Trump said.
Does Congress need to approve the transaction?
That’s not necessarily the case.
Trump unilaterally imposed his universal tariffs without Congress, and did so using the International Emergency Economic Force Act of 1977, leading to multiple lawsuits. The administration also argues that contracts that change fees do not require Congressional approval.
Previously, presidents, including Trump in their first term in the “Phase 1” Chinese trade, could only negotiate “a more limited agreement focusing on selected bilateral trade and tariff issues,” according to a report from Congressional Research Services, updated in April this year. Other examples of limited transactions include the 2023 agreement on key minerals and the 2020 transaction on digital trade with Japan.
The challenge is that Trump has made non-barriers, such as car safety regulations and the value-added tax bill charged in Europe, part of his consultations. He hopes other countries will change non-Calif. policies in exchange for the US, which reduces the new tariffs he has introduced. In return, other countries may oppose US subsidies to the companies.
Theoretically, it requires House and Senate approval to complete a transaction “to address non-tariff barriers and require changes to US law,” the Congressional Research Services report said.
If Trump just imposes it, is it really a deal?
If the other countries can’t satisfy him, Trump suggested he would do some sort of internal transaction and set a tariff rate, but he technically did that with the “liberation date” tariff on April 2nd. The import taxes announced by Trump then led to the sale of financial markets, suspending some of the new 90-day tariffs and charging a baseline rate of 10% during negotiations.
If other countries believe they are making appropriate concessions, it appears that Trump will agree not to impose tariffs originally threatened. Essentially, it means that the US will not give up anything because tariffs are new. But Trump may also pull back his tariffs without necessarily getting much reward.
“These are the best ways to learn about our efforts,” said William Reinsh, senior advisor to the Center for Strategic and International Studies, a Washington think tank. “But so far it is clear that the state has come and wants to negotiate “normal” trade with both sides making substantial concessions. ”
Original issue: May 7, 2025, 1:13pm EDT
