My New Dispatch Article on the Tariff Decision, its Implications - and a Key Issue the Court Did Not Resolve

The Court stopped a massive presidential power grab, but did not resolve a crucial issue about judicial review of executive use of emergency powers.

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Today, The Dispatch published my new article (gift link) on the Supreme Court's tariff decision, entitled "The Supreme Court Spurns a Presidential Power Grab." Here's an excerpt:

On Friday, the Supreme Court ruled on three cases challenging President Donald Trump's massive system of tariffs imposed under the International Emergency Economic Powers Act of 1977 (IEEPA). In a 6-3 decision, the court rightly held that IEEPA does not give the president the power to impose tariffs. Among the cases decided was VOS Selections Inc. v. Trump, which the Liberty Justice Center and I filed on behalf of five small American businesses harmed by the tariffs (we were later joined by prominent litigators Neal Katyal and Michael McConnell). The decision is important for its impact on tariffs, and as a rejection of a sweeping executive power grab. But it also raises a crucial broader—and as yet unresolved—issue: how much deference to give presidential invocations of sweeping emergency powers. That issue is central to various cases working their way through the courts, and may soon arise again in the tariff context….

The main basis for the court's ruling is that IEEPA does not even mention the word "tariff," and has never been used to impose them by any previous president during the statute's nearly 50-year history. The power to "regulate" importation, which IEEPA does grant in some situations, does not include a power to impose taxes.

But an additional crucial factor was the sheer scope of the authority claimed by Trump. As Chief Justice John Roberts noted in his opinion for the court, the president claimed virtually unlimited power to "impose tariffs on imports from any country, of any product, at any rate, for any amount of time…"

Under Trump's interpretation of the law, the president would have virtually unlimited tariff authority, similar to that of an absolute monarch of the kind King Charles I aspired to be. The court decisively rejected this aspiration to unconstrained presidential power. Roberts' majority opinion, a concurring opinion by Justice Neil Gorsuch, and one by Justice Elena Kagan (writing for all three liberal justices) all, in different ways, emphasized this aspect of the case. As Gorsuch put it, "Our system of separated powers and checks-and-balances threatens to give way to the continual and permanent accretion of power in the hands of one man. That is no recipe for a republic…"

But the judiciary's future ability to constrain dangerous presidential power grabs depends in large part on an issue the court managed to avoid in the IEEPA case: whether and to what extent to defer to presidential assertions that an extraordinary situation exists justifying the invocation of sweeping emergency powers.

The article goes on to discuss how the issue of deference is likely to come up in potential litigation over Trump's efforts to use Section 122 of the Trade Act of 1974 to impose a new set of sweeping tariffs:

The issue of how much deference to give to presidential invocation of emergencies is also likely to arise again in the context of tariffs. Within hours of the court's decision, Trump issued an executive order using Section 122 of the Trade Act of 1974 to impose 10 percent global tariffs, before upping the rate to 15 percent the next day. But Section 122 only permits tariffs in response to "fundamental international payments problems" that cause "large and serious United States balance-of-payments deficits" (which are not the same thing as trade deficits), "an imminent or significant depreciation of the dollar," or to cooperate with other countries in addressing an "international balance-of-payments disequilibrium." As prominent conservative legal commentator Andrew McCarthy explains in an insightful article for National Review, these preconditions for the use of Section 122 do not exist. There is no "fundamental international payments problem," and the United States does not have a balance-of-payments deficit. In addition, Section 122 tariffs can only remain in force for up to 150 days unless extended by Congress.

But when the Section 122 tariffs are challenged in court (as they likely will be), judges will have to decide whether to defer to Trump on the question of whether the statutory prerequisites are met. And when the 150-day period expires, they may also have to decide whether Trump can extend it simply by claiming a new balance-of-payments problem has arisen. If judges (mistakenly) give him broad deference, Section 122 could become a blank check for presidential tariff-setting that the Supreme Court just denied him in the IEEPA case.