Seven months ago, President Donald Trump proclaimed April 2 “Liberation Day.” Standing in the White House Rose Garden, he announced a series of “reciprocal” tariffs imposed on almost every country in the world.
He had already imposed tariffs against China, Canada and Mexico shortly after taking office in January. But are all these prices legal? The Supreme Court will consider the issue on Wednesday.
The case concerns what the Trump administration considers its greatest economic policy achievement to date, and what a set of bipartisan critics describe as yet another attempt by Mr. Trump to expand presidential power beyond the bounds of the Constitution.
Why we wrote this
After lower courts rejected the legal argument for the Trump administration’s most sweeping tariffs, the Supreme Court is now taking up the case. This case is important not only for the economic policy of the United States, but also for the separation of powers enshrined in the Constitution.
Mr. Trump took his case to the judges after three lower federal courts struck down the tariffs. The administration, the courts ruled, authorized the tariffs by misinterpreting an emergency economic powers law. Decades of precedent support their interpretation of the law, the administration counters.
If the high court rules in favor of President Trump, “it could give the president unprecedented authority,” says Wendy Cutler, senior vice president of the Asia Society Policy Institute and former acting deputy U.S. trade representative.
According to Mr. Trump, this power is essential to America’s economic competitiveness on the world stage.
This case is “one of the most important… in the history of our country,” he wrote on social media last month. “If we don’t win,” he said at the White House in October, “we will be in a weakened and troubled financial disaster for many, many years to come.”
Treasury Secretary Scott Bessent said a ruling against the administration would raise difficult practical questions about what to do with billions of dollars in tariff revenue already collected. Even tariff critics agree – to some extent – with the Trump administration’s assessment.
“I’m not sure it’s [one of] “This is one of the most important cases in American history, but it’s a historic case,” Michael McConnell, a professor at Stanford Law School who represents small businesses challenging tariffs, said on a call with reporters last week.
“This is a major confrontation between the executive branch and Congress,” he added.
Origins of the tariff authority
The Constitution delegates tariff power to Congress, with Article I providing that the legislature has the power to “establish and collect taxes, duties, imposts, and excises.”
But Congress also passed several laws giving the president some authority to set tariffs. The law at issue in this case is the International Emergency Economic Powers Act (IEEPA). This law – which does not mention the word “tariff” – states that in the face of an “unusual and extraordinary threat,” the president can declare a national emergency and invoke the IEEPA, which gives him new powers to “regulate… importation.”
The Trump administration argues that trade deficits, as well as fentanyl trafficking from China through Mexico and Canada, constitute national emergencies justifying its tariff declarations. Mr. Trump is the first president to attempt to use IEEPA to raise tariffs.
The closest any other president came to unilaterally imposing tariffs was in 1971, when Richard Nixon cited pre-IEEPA law in ordering a small, “temporary” 10 percent tariff on imports into the United States. He ended the tariffs four months later after successful trade negotiations with the countries concerned.
The Trump administration says it is following a similar strategy, citing trade deals struck with the European Union, Japan and Britain after imposing tariffs. However, unlike the era of President Nixon, many of these framework agreements provide for the continuation of a Trump tariff.
Mr. Nixon “had these tariffs for a short period of time,” says Ms. Cutler. “According to the Trump administration, once you declare an emergency, you can keep them for as long as you want.”
The Constitution and the role of Congress
The confrontation comes down to America’s first democratic principles. Taxation without representation sparked the Revolutionary War, and the Constitution sought to remedy it by giving Congress sole power to levy taxes. By unilaterally imposing tariffs — effectively a tax on U.S. companies that import goods, according to the nonpartisan Tax Foundation — critics say Mr. Trump is ignoring these fundamental principles.
Specifically, the Trump administration circumvented the Constitution by misinterpreting the IEEPA, critics from legal groups across the ideological spectrum say.
According to them, the IEEPA is in fact a law of war. When the country faces an “unusual and extraordinary threat,” the law gives the president a series of new powers to address the emergency, including the power to “regulate…importation.”
This is not rate-setting power, critics say. Furthermore, they argue, the emergency the Trump administration is talking about is not an emergency at all. The decree imposing the “Liberation Day” tariffs, for example, includes the phrase “large and persistent trade deficits.”
“The use of IEEPA is limited to extraordinary emergencies, [and] a trade deficit is not unusual or even an emergency,” said Jeffrey Schwab, litigation director at the Liberty Justice Center, a legal group that represents a group of small businesses challenging the tariffs.
The center is one of several odd partners fighting Mr. Trump’s tariffs. In its latest appearance before the judges, the organization won a landmark case restricting union organizing rights across the country – a decision celebrated by conservative America. In the tariff affair, the organization now finds itself allied with left-wing organizations, including the Brennan Center for Justice and the Democracy Forward Foundation.
The Pacific Legal Foundation, a public interest law firm that typically represents conservative causes, is also on their side. One of the group’s recent Supreme Court victories overturned a Biden administration loan forgiveness program.
In the tariff case, “the issues are actually the same,” says Oliver Dunford, the firm’s senior lawyer.
“Here, the president is effectively developing a new policy,” he adds. “And if we want to approach [a policy issue]Congress must be involved.
As for bipartisan opposition, Mr. Dunford hopes it “bodes well that…in the future there will be more bipartisan opposition to presidents when they overstep their authority.”
How the White House defends tariffs
The Trump administration, meanwhile, says trade deficits have created “an ongoing economic emergency of historic proportions.” Using tariffs to pressure China, Mexico and Canada to limit the trafficking of fentanyl into the United States is a valid use of IEEPA, the administration asserts.
One of the administration’s main assertions is that the tariffs are clearly within the president’s foreign policy and national security authority.
IEEPA “is a particularly broad delegation in the areas of foreign policy and national security,” the administration wrote in its court petition.
If the Supreme Court strikes down the tariffs, the administration added, it would “reflect an intolerable judicial intrusion into the President’s responsibility to manage foreign relations and commerce.”
Trump officials also raised what could be a compelling “cures” argument — one focused on what the administration should do in the event of defeat.
In a statement submitted to the court, Mr. Bessent wrote that billions of dollars in customs duties have already been collected. If tariffs are suddenly removed, he added, “their removal could cause significant disruption.”
Given the urgency of the case, most judicial observers believe the judges will issue their opinion months before the term ends in June.
Some experts also believe that a loss for the Trump administration would not mean the end of its tariff regime. Judges could uphold some tariffs but not others, and if some tariffs are struck down, the administration could use other laws to reimpose them. The administration has also set tariffs under various laws, such as steel and aluminum tariffs, which have not been legally challenged.
“If [the tariffs are] canceled, it would be a major blow to the president’s trade agenda, but there might be a plan B,” says Cutler. “We will still be in a world where tariffs are at the heart of the administration’s trade agenda.”
