The US Supreme Court has, in modern parlance, “struck down” President Trump’s global tariffs. The truth is rather interesting and leads to the conclusion that the US Supreme Court got it wrong.
First, with all due respect to law degrees and legal experience, this highly economic decision – one that involves understanding the operational, historic, and current definition of highly sophisticated economic terms of art, including overlapping, intertwined, and interchangeable economic terms – was just rendered by nine justices who, between them, have zero economic training or degrees.
Second, the statute that the President was using to impose tariffs – one that these economically untrained justices blocked him from using – is the 1977 IEEPA statute, or “International Emergency Economic Powers Act,” allowing presidents to act against external threats to the US economy.
The act was first invoked by Jimmy Carter to target Iran with economic sanctions for taking US hostages, but it has also been used – without restriction – by other presidents, including after 9-11. The essence of the act is a provision to allow presidents to act on threats originating outside the US borders.
Ironically, the tariffs that President Trump imposed on many nations, as most economic policy, trade, and security experts acknowledge, were focused on China. As China historically subverts sanctions by using third nations passthroughs, virtually all nations had to be initially included.
The immediate outcome of having many nations included was to trigger bilateral agreements with the US, to include not allowing China to subvert sanctions or restrictions by passthrough. BY all indications, this has worked, while also causing nations to choose between US and Chinese trade.
More importantly, the IEEPA statute would have application – seemingly without limit – in the event that President Trump declared an economic emergency from a foreign source. One could make the argument that, with a $38 trillion national debt, much tied to China, we do approach such a time.
In short, the Supreme Court ruling would fall apart if a crisis were identified, linked to a threat that exists from outside the US border, and the President utilized this threat to warrant responsive tariffs.
Third, the ruling falls apart on more obvious, purely economic grounds, as the dissent points out. Economic powers given to the President by this IEEPA statute are larger than tariffs – and interchangeable with tariffs. The majority says the President did not get an express grant for “tariffs,” but the language in the statute goes beyond tariffs, giving him parallel and interchangeable powers.
The IEEPA law says that the President may, as Congress delegates these powers to him, “investigate, block during the pendency of an investigation, regulate, direct and compel, nullify, void, prevent or prohibit … important or exportation.” The unspoken fact is that any one of these terms likely swallows the lesser act of imposing tariffs.
In other words, President Trump could reframe his tariffs as subject to an “investigation” into that nation’s unfair trade practices, or assess that the nation’s hostile trade requires “regulation” or “direct and compelling action” or must be “nullified, voided, prevented, or prohibited.” In economic terms, these terms all overlap with “tariffs,” making the ruling look misguided.
On one hand, Supreme Court justices may be expected not to be economic experts, just as they are not genetic experts – and one cannot define a woman – but they would have benefited from drawing on expert economists, making clear the interchangeability and overlap of these economic terms.
Unfortunately, this 6-3 opinion by Justice Roberts, who neatly misunderstood the meaning of “taxes” – in a prior case – to justify the unaffordable Affordable Care Act, is poorly grounded, economically naïve, open-ended on how tariffs could be uncollectible, and misses the main point.
The main point is that the President is responsible for the national security – economic as well as military – of the United States, and has a raft of tools, which he will likely use, to bring those external countries, especially China, to heel for economic abuses and threats to the US.
Once in a while, for reasons tied to missing expertise, US Supreme Court reasoning misfires. The justices’ legal acumen is real, but they also lack economic expertise – in policy, practice, and definitionally. If they had this expertise, they would not have ruled as they did. Expect this ruling to be tested as new trade terms and tools are used against those threatening the US economically.
Robert Charles is a former Assistant Secretary of State under Colin Powell, former Reagan and Bush 41 White House staffer, Maine attorney, ten-year naval intelligence officer (USNR), and 25-year businessman. He wrote “Narcotics and Terrorism” (2003), “Eagles and Evergreens” (North Country Press, 2018), and “Cherish America: Stories of Courage, Character, and Kindness” (Tower Publishing, 2024). He is the National Spokesman for AMAC. Today, he is running to be Maine’s next Governor (please visit BobbyforMaine.com to learn more)!
