Tariffs: Trade Policy or Just Another Negotiation Tactic?

The other day, the issue of tariffs came up in a casual conversation. You see, a friend—we’ll call him Jim, because that’s his name—enjoys reading my column. I was flattered! Anyway, he mentioned that tariffs would make a good column topic. We quickly agreed, however, that the underlying motivation of an administration imposing tariffs is often less about economic policy and more about negotiation.

Since Jim and I both negotiate for a living—he in the courtroom and I in commercial real estate—it struck me that tariffs aren’t just about leveling the playing field. More often than not, they’re a tool wielded to push for better deals. And in that respect, they’re not so different from the tactics used in boardrooms, lease negotiations, and legal disputes.

Take a recent example: when an administration announces a tariff on imported goods, it’s easy to assume the goal is to make domestic industries more competitive by making foreign products more expensive. That’s the textbook definition. But in practice, tariffs are often more about leverage. A country imposes tariffs not necessarily to keep them in place forever, but to extract concessions—lower tariffs on their own exports, stricter protections for intellectual property, or better trade terms overall.

If that sounds familiar, it’s because the same playbook is used in real estate negotiations all the time. Sellers list properties at inflated prices not because they expect to get them, but because they know buyers will push back. Landlords demand above-market rents knowing tenants will counter. In each case, the initial position is not the true goal—it’s a starting point in a larger negotiation.

Attorneys, like my friend Jim, take a similar approach. Motions, objections, and procedural tactics aren’t always about winning outright; sometimes, they’re just tools to gain leverage. A well-placed motion might force the other side to rethink their position, just as a newly imposed tariff might push a trade partner back to the bargaining table.

And yet, for those caught in the middle, the impact can be very real. In real estate, when negotiations drag on, tenants may face uncertainty, and deals can stall. In legal battles, a drawn-out process can drain resources. With tariffs, businesses that rely on imported goods—manufacturers, retailers, and consumers—often bear the immediate burden of higher costs, even if the long game is about brokering a better deal.

So how do you navigate these tactics? Whether you’re a business owner, investor, or consumer, recognizing the difference between a firm position and a negotiation strategy is critical. Is the other side genuinely standing their ground, or are they just applying pressure to move things in their favor? Understanding this can help you stay level-headed in negotiations and avoid making knee-jerk reactions that could cost you in the long run.

In the end, whether in global trade, real estate, or the courtroom, the art of negotiation remains the same. The first offer, the initial demand, or the newly imposed tariff isn’t always about the outcome—it’s about the process of getting there.

Jim and I left that conversation with a shared conclusion: tariffs may shape economic policy, but at their core, they’re just another tool in the game of negotiations. And as any good negotiator knows, it’s not about the first move—it’s about who walks away with the better deal.

 Allen C. Buchanan, SIOR, is a principal with Lee & Associates Commercial Real Estate Services in Orange. He can be reached at abuchanan@lee-associates.com or 714.564.7104. His website is allencbuchanan.blogspot.com.