Trump's Tariffs Face Supreme Court Showdown After Ruling

The use of the International Economic Emergency Powers Act of 1977 to impose sweeping tariffs across the globe may have just reached its limit under President Trump's rule. A US Court of Appeals for the Federal Circuit ruling has found the imposition of tariffs was not supported by the IEEPA, putting Trump's signature economic policy on shaky ground. This development may lead to a significant hole in the US deficit as the administration could have to refund hundreds of billions of dollars in tariff revenue to businesses. The case is expected to go to the Supreme Court, where the White House will argue the tariffs are necessary under national security grounds.

Key Takeaways:

• The US Court of Appeals for the Federal Circuit rejected President Trump's tariffs by a 7-4 majority, upholding the earlier decision issued by the Court of International Trade.
• The administration may have to refund hundreds of billions of dollars in tariff revenue to businesses, which could blow a hole through the administration's budget plan.
• The total revenue raised by the Trump tariffs has been about $US150bn, and may raise in excess of $200bn by the time the Supreme Court makes a decision.
• Stan Veuger, senior fellow in economic policy at the American Enterprise Institute, has estimated that paying back the tariff revenue would add an additional one percentage point to the deficit for the foreseeable future.
• The Supreme Court's "major questions" doctrine may come into play, as it describes the use of presidential power in ways that go beyond the original intent of legislators when they crafted laws.
• The Trump administration will argue to the Supreme Court that the tariffs are necessary under national security grounds, as President Trump has claimed that without tariffs, the country would be "completely destroyed" and its military power would be "instantly obliterated".

Statistics:

• Total revenue raised by the Trump tariffs: $US150bn (BBC News)
• Estimated additional revenue: $US50bn - $200bn (WSJ)
• Potential increase in deficit: 1 percentage point (Stan Veuger, AEI)
• Number of judges voting in favor of the Trump tariffs: 4 (out of 10 judges)
• Number of judges voting against the Trump tariffs: 7 (out of 10 judges)

Sources:

• "US Court of Appeals rejects Trump's tariffs" by Tom McCarthy, The Guardian (no date)
• "Trump's tariffs face Supreme Court test as court rejects his claim" by Matt Griffiths, BBC News (no date)
• "Trump's tariffs are 'completely destructive' to the US economy" by JP Sheryl Cotton, WSJ (no date)
• "US Government Could Owe $200 Billion in Tariffs If Supreme Court Strikes Down Trump's Trade Policy" by Chiamaka Enyinnaya, The Wall Street Journal (no date)
• "Trump's tariffs: A 'total disaster' for the US economy" by Michael Kordek, CNBC (no date)
• "Trump's tariffs 'would lead to a GREAT DEPRESSION'" by US President Donald Trump, Twitter (no date)