Supreme Court Strikes Down Trump’s Tariffs

The Supreme Court on Friday struck down President Donald Trump’s sweeping tariffs — a major repudiation of a core piece of Trump’s economic program.

The 6-3 decision is a rare instance of the conservative-led court reining in Trump’s expansive use of executive power. Chief Justice John Roberts and Justices Amy Coney Barrett and Neil Gorsuch joined the court’s three liberals in the majority.

“The President asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope. In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it,” Roberts wrote, declaring that the 1977 law Trump cited to justify the import duties “falls short” of the Congressional approval that would be needed.

The ruling wipes out the 10 percent tariff Trump imposed on nearly every country in the world, as well as specific, higher tariffs on some of the top U.S. trading partners, including Canada, Mexico, China, the European Union, Japan and South Korea.

Several of those countries have entered trade agreements with the U.S. — and before the ruling indicated that they would continue to honor those agreements.

That is because the victory for the 12 Democratic-run states and small businesses that challenged Trump’s tariffs is expected to be short lived. The White House has signaled it will attempt to use other authorities to keep similar duties in place.

“We've been thinking about this plan for five years or longer,” U.S. Trade Representative Jamieson Greer told POLITICO in December. “You can be sure that when we came to the president the beginning of the term, we had a lot of different options”

“My message is tariffs are going to be a part of the policy landscape going forward,” Greer said.

But Trump has repeatedly said that a loss in the tariff case at the Supreme Court would be a “disaster” for the United States, even though critics of his restrictive import tax scheme argue the country prospered for decades with low tariffs.

It undercuts his ability to impose tariffs on a whim to address geopolitical conflict — like a threat to impose tariffs on countries that do business with Iran — and to threaten tariffs as he tries to gain a better negotiating position — like his tariff threats in an attempt to acquire Greenland. Businesses had decried those “national security” tariff threats for fueling economic uncertainty, but the administration said they were necessary for achieving its policy goals.

But the majority of the justices rejected arguments from Trump and their dissenting colleagues that the court should defer to Trump because of the role tariffs play in foreign relations.

“Whatever may be said of other powers that implicate foreign affairs, we would not expect Congress to relinquish its tariff power through vague language, or without careful limits,” Roberts wrote.

In a visit to Georgia Wednesday, Trump touted a steel business he said had been able to boost production because of his widespread use of tariffs, questioned why the Supreme Court would rule against him and needled the justices for taking months to resolve the issue.

“The tariff is the greatest thing that's happened in this country,” Trump said. “We’re making a fortune. But more importantly, all these factories are booming now, and they were all dead.”

The federal government could now be forced to issue billions of dollars in refunds to companies that paid the tariffs the high court ruled illegal. Many companies have already sued to protect their refund claims in the event the court struck down the Trump tariffs.

The majority opinion made no mention of the battle over refunds, but Justice Brett Kavanaugh predicted some chaos in his dissent.

“The United States may be required to refund billions of dollars to importers who paid the IEEPA tariffs, even though some importers may have already passed on costs to consumers or others,” Kavanaugh wrote. “The refund process is likely to be a ‘mess,’” he added, quoting an exchange the justices had on the issue during oral argument in November.

The ruling also raises questions about the future of trade deals that the Trump administration has struck with the European Union, Japan, South Korea and other trading partners to reduce the tariffs he targeted at their exports to the United States.