Trump’s Tariffs Raise Legal Questions — Gary Sasse

Trump’s Tariffs Raise Legal Questions — Gary Sasse

In addition to the chaos surrounding President Trump’s rollout of his tariff plans and the adverse market reactions, there may also be constitutional issues that will need to be addressed.

On April 2, the President imposed extensive new tariffs on our nation’s trading partners. These presidential “diktats” plunged markets into tailspins and enhanced the likelihood of a recession. One week later, Mr. Trump announced a 90-day pause on reciprocal tariff levies except for China.  In addition, industry-specific tariffs on commodities like steel, aluminum, and autos remained unaffected. While easing tension in global markets, the pause has created uncertainty.

The way in which the President implemented his tariff increases raises legal questions centered around the use of presidential emergency powers. The New Civil Liberties Alliance (NCLA), a conservative advocacy group supported by Republican mega-donor Charles Koch, filed a lawsuit arguing that Trump’s use of a national emergency to justify the tariff adjustments was unconstitutional.  Politico reported that various other business groups are also considering legal challenges.

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At issue is the 1977 International Emergency Economic Act (IEEPA) that the Trump Administration has referenced as its authority to impose additional tariffs. Trump would be the first president to use the IEEPA to increase tariffs, which is a power constitutionally given to Congress. The IEEPA allows a president to assess tariffs when imports threaten national security, cause serious trade imbalances, result in upsurges in imports harmful to specific industries, and cause discriminatory trade practices.

A Wall Street Journal editorial said, “none of these trade provisions empowers Mr. Trump to impose tariffs on all imports from all countries based on an arbitrary formula. Section 122 lets the President impose tariffs of up to 15 percent in response to trade deficits, but Congress must approve them after 150 days. Someone should sue to block his abuse of power.”   

While wagering on a court’s potential ruling is generally a fools’ errand, Andrew Morris, a senior litigation counsel at the NCLA, opined that by invoking emergency power to impose as across-the-board tariffs “President Trump has misused that power, usurped Congress’s right to control tariffs, and upset the Constitution’s separation of powers.”

The most effective way to deal with executive overreach is for Congress to immediately clarify its constitutional responsibility to set tariffs and exercise oversight over executive tariff decisions. Several members of Congress have discussed such legislative remedies. However, both Houses of Congress are stalemated because several Republicans act as if we have a parliamentary system and do not want to publicly challenge their President. If the shoe was on the other foot, and the Democrats controlled both branches, it is doubtful that the result would be much different as witnessed by President Biden exceeding his constitutional authority with regards to student loan forgiveness

Litigation may be the only realistic option to challenge the ability of the chief executive to unilaterally impose historic changes for the nation’s trade and tariff policies. This issue highlights the ongoing debate about the scope of presidential powers which the federal courts have been dealing with since the founding of the republic.

 

Gary Sasse served as Director of the Rhode Island Departments of Administration and Revenue, President of RIPEC, and Executive Director of the Hassenfeld Institute for Public Leadership at Bryant University.