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1/ If you target me with tariffs, that's bad for your consumers who have to pay more to buy my products, and it's bad for my producers who will probably sell you fewer things. For my government, the negative impact on your consumers is irrelevant unless it changes your behaviour.

2/ If I retaliate with tariffs, that's bad for my consumers who will have to pay more for your goods and bad for your producers who will sell me fewer things. It is good for my producers who compete in my market with yours, but that is likely a different group than those hit with your tariffs.

3/ In other words, if you hurt both of us by hitting me with tariffs then my only retaliation option basically also consists of hurting us both - which only helps if it brings us to a truce or prevents you escalating further.

4/ This means that those confronted with a US willing to hurt itself with tariffs have no good options. I think you can make a credible case both for aggressive resistance and for appeasement. Anyone pretending the choice is easy is, in my view, kidding themselves.

5/ The case for aggressive resistance is that if you can cause the US real economic pain, their public may be less willing to endure it than yours - because you have the more compelling story to tell about being the aggreived party... ... and that such pain will make them back off.

7/ There's also the non-trade counterargument, which is that the US is important in a bunch of ways like in the context of Ukraine, or Pacific security, and alienating them too badly may endanger that engagement.

8/ The argument for appeasement is that a rate of 10-15% with a lot of carveouts is unpleasant but manegable and isn't likely to lead to a flood of recalibrated supply chains. Moreover, a deal offers predictability at a time when that's what investors and business is craving.

9/ The counterargument is that it encourages negative behaviour and hostage taking, and demonstrates your ultimate reluctance to retaliate or escalate - a lesson that may cost you in time. Now granted, should Trump reneg you could always retaliate - but the temptation will be to keep caving.