Trump’s Tariffs at the Supreme Court

a test

There are three things wrong with Trump’s tariffs. The first is that they cannot be expected to provide the benefits claimed, can be expected to make both the US and its trading partners poorer; the arguments offered for them depend on not understanding the economics of trade. For an explanation of why that is true, see an earlier post.

The fact that the tariffs make us poorer may be the most important thing wrong with them but it is irrelevant to the Supreme Court; nothing in the Constitution requires the president to do his job well. The questions relevant to the Court are whether what Trump is doing was authorized by past Congressional legislation and whether it was constitutional for Congress to authorize it.

What Counts As An Emergency?

Tariffs are under the authority of Congress, not the president.¹ Trump’s justification for setting them himself is congressional legislation, the International Emergency Economic Powers Act.

(a) Any authority granted to the President by section 1702 of this title may be exercised to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States, if the President declares a national emergency with respect to such threat.

(b) The authorities granted to the President by section 1702 of this title may only be exercised to deal with an unusual and extraordinary threat with respect to which a national emergency has been declared for purposes of this chapter and may not be exercised for any other purpose. (IEEPA, 50 U.S. Code § 1701, emphasis mine)

Trump declared that his Worldwide Reciprocal Tariffs were intended to deal with the US trade deficit.² Whether the deficit is a threat and whether tariffs are a good way to deal with it are questions for economists³ but whether it is unusual is relevant to judges, since if it is not the IEEPA does not apply.

(From the St. Louis Fed)

The US had a trade deficit most years until 1870 and every year since 1970. Current deficits are relatively high, measured as a fraction of GDP, but there have been higher in the past and deficits have been running at about the current level for the past twenty-five years. Whether or not that is a threat it is hard to see how it can described as an unusual one.

Trump also declared an emergency related to illicit drugs and illegal immigration, imposing tariffs on that basis on goods from China, Canada, and Mexico. Both illicit drugs and illegal immigration have been issues for decades.

The administration’s position appears to be that anything the president declares as an emergency justifies action under the IEEPA. That ignores both the plain language of the act and its obvious function, authorizing the president to deal with problems normally under the authority of Congress when they are too urgent for Congress to deal with. The administration’s position makes the restriction of the power to emergencies meaningless, since the president can always declare one.

Congressional Delegation and the Major Questions Doctrine

The Constitution establishes a clear division between the authority of the executive (Article II) and of the legislature (Article I), with legislation, trade and taxation assigned to Congress. As the administrative state has developed over the past century administrative agencies established by Congress but part of the executive branch have engaged in extensive legislation in the form of rule making, raising the question of to what extent Congress can delegate its powers to the executive.

The current court has held both that there are limitations on Congress’s ability to delegate and that permitted delegation used to decide important issues must be explicit, that ambiguity in the legislation must be read as a restriction, the Major Questions Doctrine. One power that the Court does not believe may be delegated is the power to tax. A tariff is a tax on imports, so the administration has to argue that it is really a regulation or licensing charge which only produces revenue as a side effect, a claim made more difficult by Trump’s repeated claims of how many billions of dollars his tariffs are bringing in.

The Major Questions Doctrine should result in a decision against the tariffs on the grounds that none of the purported emergencies fits the text of the act but that does not appear to be the line of argument being followed by the Justices, judging by reports of the case; perhaps they have given up on trying to restrict emergency legislation to emergencies. Instead they have focused on the fact that the IEEPA does not mention imposing tariffs as one of the acts it authorizes:

(a) In general

(1) At the times and to the extent specified in section 1701 of this title, the President may, under such regulations as he may prescribe, by means of instructions, licenses, or otherwise—

(A) investigate, regulate, or prohibit—

(i) any transactions in foreign exchange,

(ii) transfers of credit or payments between, by, through, or to any banking institution, to the extent that such transfers or payments involve any interest of any foreign country or a national thereof,

(iii) the importing or exporting of currency or securities,

by any person, or with respect to any property, subject to the jurisdiction of the United States;

(B) investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States; and.

(C) when the United States is engaged in armed hostilities or has been attacked by a foreign country or foreign nationals, confiscate any property, subject to the jurisdiction of the United States, of any foreign person, foreign organization, or foreign country that he determines has planned, authorized, aided, or engaged in such hostilities or attacks against the United States; and all right, title, and interest in any property so confiscated shall vest, when, as, and upon the terms directed by the President, in such agency or person as the President may designate from time to time, and upon such terms and conditions as the President may prescribe, such interest or property shall be held, used, administered, liquidated, sold, or otherwise dealt with in the interest of and for the benefit of the United States, and such designated agency or person may perform any and all acts incident to the accomplishment or furtherance of these purposes. (50 U.S. Code § 1702)

The Court on Trial

Delegating to the president the power to impose tariffs, a power explicitly given to Congress in the Constitution, is a major question. Under doctrine proclaimed by this court that means that the legislation claimed to delegate that power must be read narrowly. On a narrow reading, on anything but a very broad reading, the legislation fails to apply to President Trump’s tariffs for two independent reasons:

It only grants power in an emergency, which under the language of the Act neither the trade deficit nor the illegal drug problem is; the deficit has existed since 1970, the War on Drugs was proclaimed in 1971.

The powers granted to the president in the Act do not include the power to impose tariffs.

If the six conservative justices believe in the principles they claim, the administration will lose the case 9-0.

P.S. A much more detailed discussion of some of this, including arguments offered by Justices and the administration.

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1. The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises … To regulate Commerce with foreign Nations … (U.S Constitution, Article I, Section 8)

2. “I found that conditions reflected in large and persistent annual U.S. goods trade deficits constitute an unusual and extraordinary threat to the national security and economy of the United States that has its source in whole or substantial part outside the United States. I declared a national emergency with respect to that threat, and to deal with that threat, I imposed additional ad valorem duties that I deemed necessary and appropriate. ” (Executive Order July 31, 2025)

3. The answers are no and no.