WASHINGTON – President Donald Trump can’t stop contradicting himself on his own tariff plans.
He mentions that he is working towards finalizing numerous new trade agreements within a short timeframe, yet he has also noted that it may be logistically challenging to attend all the required meetings physically.
Trump has claimed that he will implement revised tariff rates that have been internally deliberated within the U.S. government in the coming weeks. However, this move was already executed on his self-proclaimed “Liberation Day” on April 2, which had a significant impact on the global economy.
The President from the Republican party has stated that he is actively engaged in discussions with the Chinese administration regarding tariffs. In contrast, both the Chinese authorities and the U.S. Treasury Secretary Scott Bessent have stated that official negotiations have not yet commenced.
What should one believe? The sure bet is that uncertainty will persist in ways that employers and consumers alike expect to damage the economy and that leave foreign leaders scratching their heads in bewilderment.
And the consequences of all this tariffs turmoil are enormous.
Trump placed tariffs totaling 145% on China, leading China to retaliate with tariffs of 125% on the U.S. — essentially triggering a trade war between the world’s two largest economies with the potential to bring on a recession.
Trump’s negotiating trade deals with himself
The president told Time magazine in an interview released Friday that 20%, 30% or 50% tariffs a year from now would be a “total victory,” even though a financial market panic led him to temporarily reduce his baseline import taxes to 10% for 90 days while talks take place.
“The deal is a deal that I choose,” Trump said in the interview. “What I’m doing is I will, at a certain point in the not too distant future, I will set a fair price of tariffs for different countries.”
If that is confusing for the nation’s trading partners, it’s also sowing anxiety at home.
The Federal Reserve’s beige book, a compilation of anecdotes from U.S. businesses prepared eight times a year, on Wednesday reported a huge spike in uncertainty among American companies that has caused them to pull back on hiring and investment in new projects. The word “uncertainty” cropped up 80 times, compared with 45 in early March and just 14 in January.
Beyond the idea that Trump plans to keep some level of tariffs in place, the world finance ministers and corporate executives who gathered this past week in Washington for the International Monetary Fund conference said in private discussions that the Trump administration was providing no real clarity on its goals for substantive talks.
“There’s not a coherent strategy at the moment on what the tariffs are supposed to achieve,” said Josh Lipsky, senior director of the GeoEconomics Center at The Atlantic Council. “My conversations with the ministers and governors this week at the IMF meetings have been they don’t understand completely what the White House wants, nor who they should be negotiating with.”
Other countries trying to get talks going
Swiss President Karin Keller-Sutter, in an interview with broadcaster SRF released Friday, said after a meeting with Bessent that Switzerland would be one of 15 countries with which the United States plans to conduct “privileged” negotiations. But she said a memorandum of understanding would have to be reached for talks to formally begin.
She was happy to at least know whom to talk to, saying that “we have also been assigned a specific contact person. This is not easy in the U.S. administration.”
Nations are deploying various negotiating tactics.
The South Korean officials who met with their U.S. counterparts this week say they specifically asked for the tariffs to be lifted with the goal of working toward an agreement by July. The European Union has pushed for cutting tariffs to zero for both parties, though Trump objects to European countries charging a value-added tax, which is akin to a sales tax that he says hurts U.S. goods.
Trump continues to radiate optimism that negotiated deals with other countries will occur despite his claims that he will set his own deals and a lack of clarity about how the process goes forward.
“I’m getting along very well with Japan,” Trump told reporters on Friday. “We’re very close to a deal.”
As part of a deal with Japan, the Trump administration has publicly called on the Japanese government to change its auto safety standards that put a greater focus on pedestrian safety. But the steering wheels on autos sold in Japan are on the right-hand side, while U.S. automakers put their steering wheels on the left.
“I don’t think left-hand drive cars sell in Japan,” Prime Minister Shigeru Ishiba told a parliamentary session this week.
“We want to make sure we aren’t seen as being unfair,” Ishiba said, suggesting a possibility of reviewing Japanese car safety standards.
Higher prices and shortages are likely
As Trump continues to make conflicting statements about tariffs, companies are actively looking at higher prices, lower sales and possibly bare shelves in stores due to fewer shipments from China.
Ryan Petersen, CEO of Flexport, a supply chain company, said on the social media site X: “In the 3 weeks since the tariffs took effect, ocean container bookings from China to the United States are down over 60% industry wide.”
Consumers are getting notices via email and social media from retailers that lamps, furniture and other housewares will now include tariff-related charges.
The showerhead company Afina on Wednesday reported on a test to see if people would buy an American-made product that cost more than an import. Their Chinese-made filtered showerhead retails for $129, but to manufacture the same product domestically would take the price up to $239.
When customers on the company’s website were given a choice between a showerhead made in the USA or a cheaper one made in Asia, there were 584 purchases of the $129 model made abroad and not one sale of the domestically produced showerhead.
Ramon van Meer, Afina’s founder, concluded in his written analysis: “If policymakers and pundits want to rebuild American industry, they need to grapple with this truth: idealism doesn’t always survive contact with a price tag.”
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AP economics writer Christopher Rugaber in Washington and AP writers Jamey Keaten in Geneva and Mari Yamaguchi in Tokyo contributed to this report.
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