Supreme Court Tariff Decision

Justices in Heated Agreement... and Disagreement

The Supreme Court issued its decision on Friday in the case of Learning Resources Inc. v. Trump (combining other cases). The Court ruled 6-3 for the plaintiffs against the Trump Administration. But it is a little more complicated than that.

The Case

The dispute centers around the International Emergency Economic Powers Act (IEEPA) from 1977. This gives a president wide ranging authority to “regulate, direct and compel, nullify, void, prevent or prohibit, any acquisition, holding, withholding, use, transfer, withdrawal, transportation, importation or exportation of, or dealing in, or exercising any right, power, or privilege with respect to, or transactions involving, any property in which any foreign country or a national thereof has any interest by any person, or with respect to any property, subject to the jurisdiction of the United States” (50 U.S.C. § 1702(a)(1)). There are a few other details, but this gives you the idea.

The Court did not rule on the question of whether there is, in fact, an emergency taking place. They seem to have left that decision to the president to decide, as the IEEPA suggests.

The question is over whether or not the list above—which does not use the word “tariff”—could also include the imposition of tariffs. The decision written by Chief Justice Roberts rules that because tariffs are not mentioned, tariffs cannot be used under this law. He thinks it is pretty straightforward.

Then things gets complicated.

Concurring

A tradition in the Court that developed early in its history is that all other justices can write their reasons for agreeing or disagreeing with the decision. In this case, of the 6 justices that agreed that tariffs are not a part of the law, 5 wrote their own opinions: Roberts, Barrett, Brown, Gorsuch, and Kagan. So we have five different explanations for why they agree.

Justice Gorsuch wrote a concurrence of 48 pages in which he not only argued his case, he took aim at the other concurrences! He is especially hard on the liberal justices (Brown, Kagan, and Sotomayor) who thought President Biden had this kind of wide-ranging authority to forgive student loans, but don’t think so now that a Republican is in the White House. The other three were much shorter and didn’t get into the fight quite so much, but there is clearly a lot of disagreement about their agreement.

Their disagreement arises from the “major questions doctrine,” an idea in the law that only Congress can resolve issues of vast economic and political importance. For example, if Congress passes a law that says we need to reduce the number of traffic accidents, the President can’t decide that the best way to do so is to ban people from driving at night. So in regards to the case at issue, the President can’t just decide that tariffs are the best way to do what IEEPA wanted, even though they are never mentioned. The major questions doctrine arises because a lot of legislation is ambiguous and a lot of presidents (and their administrative agencies) have used those ambiguities to take on a lot of power to themselves.

Dissenting

There are two dissenting opinions, one from all three of the dissenters (written by Kavanaugh and agreed to by Alito and Thomas) and one from Thomas. Kavanaugh argues that regulations of the sort listed above in IEEPA have always included tariffs and he offers (over 68 pages) a list of times when this has occurred. Like Roberts, but drawing the opposite conclusion, Kavanaugh thinks this is pretty obvious. He argues that the Roberts decision would allow the President to impose an embargo or cut off all trade, just not regulate through tariffs (under IEEPA).

Thomas, like the concurrences, argues that this is really about the major questions doctrine and argues that the President can make a lot of these decisions, especially when it comes to questions about how to relate to foreign governments. In keeping with his long history on the bench, he maintains a clear distinction between domestic and foreign powers.

Implications

As a court of law not of fact, the Supreme Court decides only if something is constitutional or not. So the question of what to do with the tariff money received by the government is still open. That has been sent down to a lower court to work out.

In the meantime, President Trump has (after a vituperative rant about the traitorous actions of the justices) simply used other statutes to impose the same or higher tariffs. The only problem with these other laws, from his point of view, is that they require Congressional approval within a set period of time. Given how deadlocked Congress is, that seems unlikely.

Deadlocked Congress

Update on that: yes, DHS is still unfunded. This might get a little more attention in light of recent events south of us. The Mexican military (with assistance from the United States) tried to capture one of the leading drug cartel leaders. He died in the attempt. His cartel has now gone on a spree of violence. Some American tourists in popular tourist areas like Guadalajara and Puerto Vallarta have been taken hostage, according to the State Department. Shelter in place orders have been issued in much of the country.

The Department of Homeland Security is supposed to monitor and arrest cartel members in the US. Many entered the country while it was so easy to get in under President Biden. An unfunded DHS could be severely impeded in its abilities at a time of cartel reprisals.

No doubt the President will mention this tomorrow evening (Tuesday) at the State of the Union Address. We have talked about the politics of immigration and border enforcement in past posts. The Democrats have been very vocal in their support of any and all illegals, including even MS13 gang members. We pray that nothing horrible happens, but a few incidents could completely change public attitudes going into the midterm elections.