The future of President Trump’s tariff strategies hangs in the balance as legal battles unfold. Treasury Secretary Scott Bessent suggests that the current Supreme Court case might not significantly impact the administration’s ability to maintain its tariff agenda.
Understanding Trump’s Tariff Justifications
The core issue involves the Trump administration’s use of the International Emergency Economic Powers Act (IEEPA). This act, enacted in 1977, grants the President extensive authority to impose tariffs following the declaration of a national emergency. The White House has claimed that the rising imports of fentanyl justify this emergency.
Potential Supreme Court Decisions
Should the Supreme Court rule that the fentanyl crisis cannot be classified as an emergency, it may invalidate many existing tariffs. However, Bessent remains undeterred. He indicated that the administration could easily transition to alternative justifications to sustain its tariff structure.
- Section 301 of the Trade Act of 1974: Requires investigations into unfair trade practices.
- Section 232 of the Trade Expansion Act of 1962: Focuses on national security as a rationale for tariffs.
- Section 122 of the Trade Act of 1974: Offers a temporary method to implement tariffs without extensive investigations.
Exploring Section 122 for Quick Implementation
Bessent pointed out that Section 122 could provide a rapid way to reinstate tariffs following a negative Supreme Court ruling. This section would permit tariffs of up to 15% for 150 days without needing congressional investigations into trading partners.
Long-Term Tariff Strategies
For ongoing tariffs, the administration might choose Sections 301 or 232. Section 301 requires detailed examinations of trading partners’ policies deemed unfair, while Section 232 has already supported tariffs on metals and automobiles.
Additionally, Congress could pass legislation granting explicit tariff authority to the President. Such a move might attract bipartisan support, according to legal experts like Raj Bhala from the University of Kansas Law School.
Implications of Tariff Policies
Bessent remains hopeful about the administration’s standing before the Supreme Court. He stressed that a judicial loss would negatively affect American citizens. Moreover, he highlighted China’s agreement to regulate fentanyl precursor exports earlier this year, attributing it to the pressure created by existing tariffs.
“Tariffs are a shrinking ice cube,” he remarked, emphasizing the need to rebalance trade and boost domestic production.
