Dem
47
GOP
53
Yesterday, the U.S. Supreme Court held oral arguments in Learning Resources, Inc. v. Trump, in which the Trump administration appealed his lower court losses that held his tariffs are unlawful. As happens so often with this administration, Trump made up an emergency and then signed executive orders unilaterally imposing outrageous tariffs on imported goods from just about every country in the world, including an island inhabited only by penguins. Who can forget Trump triumphantly holding up a poster listing all the countries to be targeted, including Heard Island, a UNESCO World Heritage site that is home to penguins, elephant seals and sea birds—but no people? He then handed the mess off to his Solicitor General John Sauer to reverse engineer a legal justification for his power grab—a tall order, since the Constitution specifically names levying tariffs as a power belonging exclusively to Congress.
Sauer gamely tried to convince two courts that Trump was given this power by Congress in a statute called the International Emergency Economic Powers Act (IEEPA), pronounced by the lawyers as Eye-ee-pa. He was unsuccessful in the D.C. district court and before the Court of International Trade and appears to be on shaky ground with the Supreme Court.
This case pits Congress' Article I taxation power against the president's Article II powers over foreign affairs and whether Congress would or could delegate any of its taxing power without a clear indication it was doing so. The question before the Justices is a straightforward one: Does IEEPA authorize the president to impose tariffs? The statute itself says nothing about tariffs. Instead, the statute addresses the president's power during a declared national emergency to handle an "unusual and extraordinary threat" originating outside the U.S. The statute authorizes the president to, among other things, "...regulate... the importation or exportation of, or dealing in... or transactions involving, any property in which any foreign country... has any interest..." Meanwhile, Title 19 of the U.S. Code, which governs customs duties (i.e. tariffs) and which Trump did not invoke, does allow the president to impose limited tariffs in some circumstances.
Against that backdrop, Sauer tried mightily to convince the Justices that the word "regulate" in IEEPA allows the president to have unlimited power to impose tariffs on any country in any amount at any time. Even this Supreme Court was skeptical of that position. They noted that just last year they overturned the Chevron standard and no longer show deference to an agency's interpretation of a statute that explicitly outlines its authority. So, how can they find that Congress implicitly intended to hand over its taxing power over foreign entities to the executive branch?
Sauer then argued, well, this isn't actually a tax because its purpose is not to generate revenue but to bring these countries to the negotiating table. In that sense, it's a "regulatory tariff," so it falls more squarely in Trump's authority over foreign affairs. At that point, Chief Justice John Roberts mentioned the claims by Trump that the tariffs are reducing the deficit and also that tariffs were imposed on countries where the U.S. enjoys a trade surplus, like Switzerland. The Justices did not seem persuaded that calling it by a different name could serve to change the character of the tariff or that a "regulatory tariff" is even a thing.
The Justices also pointed out that if Trump's powers extend this far, a Democratic administration could declare climate change a national emergency and impose sweeping tariffs on all gas-powered cars imported into the U.S. Sauer had to concede that would indeed be possible. Gorsuch also expressed concern that reading the statute as conferring this power on the president would mean that it would be impossible for Congress to take it back since the president could veto such efforts.
Finally, the Justices asked how its "major questions doctrine" impacted the government's argument. In 2022, the Court introduced a new method to scrutinize agencies' regulatory actions by holding that regulations of significant political or economic issues must have clear Congressional authority. No one disputes that IEEPA does NOT contain clear Congressional authority giving the president the power to unilaterally impose tariffs however he sees fit.
The only clear votes for Trump's position came from the usual suspects, Associate Justices Clarence Thomas and Samuel Alito. Associate Justices Brett Kavanaugh and Amy Coney Barrett at times seemed to agree that the statute could be read that broadly but struggled with the fact that no other president has used it in this way and other statutes do not have the word "regulate" do so much heavy lifting.
Interestingly, no one argued that Trump's declaration of a national emergency is bogus. They all seemed to accept that his claims, however outlandish, were not part of the case and perhaps not even subject to judicial review. That issue was potentially left for another day.
We are not the only ones who believe the Court may finally rule definitively against Trump—and on his signature issue. Most outlets agree that the Justices were skeptical of Trump's position. Amy Howe of SCOTUSblog writes that "a majority of the justices appeared to agree with the small businesses and states challenging the tariffs that they exceeded the powers given to the president under a federal law providing him the authority to regulate commerce during national emergencies created by foreign threats."
This case was heard on an expedited basis before final judgment in the lower court. The Court stayed the TRO the lower court had put in place, and the plaintiffs claim that because the tariffs are currently in place, their small businesses are at risk if the Court does not decide this case quickly. Because this case was fast-tracked, a decision is likely to come much sooner than the end of the term.
If Trump loses—and again, the tea leaves are reading that way—it will be a huge blow to his foreign policy, such as it is. Most other nations, to be blunt, don't really take him seriously. But they do work with him, because he has the ability to influence vast amounts of international trade. If he loses the main (and really only) tool he has for that, he's going to have an even harder time securing new trade deals (something he tends to lose on, even WITH the tariff threats), and he's going to have an even harder time securing "wins," even the not-really-credible wins, like [COUNTRY X] promising, cross their hearts, hope to die, they will invest [TENS/HUNDREDS] of billions in the U.S. (L)