U.S. Treasury Secretary Scott Bessent defended President Trump's trade policies during an ABC News interview, emphasizing the concept of 'strategic uncertainty' in negotiations. Bessent characterized Trump's tariff strategy as leveraging uncertainty against other nations, suggesting it's an effective negotiation tool. He noted that Trump's tariffs serve as a deterrent while offering terms for negotiation to trade partners. Despite mixed public sentiment, Bessent believes Trump's approach could effectively address the trade deficit and strengthen U.S. manufacturing by realigning trade agreements with countries like China, Canada, and Mexico.
In game theory, it's called 'strategic uncertainty,' where you don't reveal your negotiation position. Nobody's better at creating this leverage than President Trump.
He's shown these high tariffs as a stick. The carrot is 'take off your tariffs and trade barriers, then we can talk.'
The motivation for these tariffs is to address the trade deficit and defend the U.S. manufacturing sector's position in a disadvantageous global market.
Trump's trade policies have strained relationships with allies like Canada and Mexico while intensifying tensions with China.
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