Trump tariffs back on after appeals court slams brakes on trade court's ban

New York Post

a day ago

A federal appeals court put the brakes Thursday on a lower court order that overturned most of President Trump's sweeping tariffs.
A full 11-judge panel on the US Court of Appeals for the Federal Circuit stayed the order by the Manhattan-based Court of International Trade while a White House appeal is heard.
The Court of International Trade had ruled that Trump exceeded his authority under the International Emergency Economic Powers Act by imposing a 10% flat duty rate on dozens of countries around the world — as well as 25% tariffs on Canada and Mexico and 20% tariffs on China in response to illegal fentanyl trafficking.
4 A federal appeals court put the brakes Thursday on a lower court order that overturned most of President Trump's sweeping tariffs.
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The tariffs had been challenged by a dozen states and five small businesses — which the appeals panel gave until June 5 to respond to Thursday's stay.
Wall Street shrugged off the about-face, with the Dow Jones Industrial Average closing up 117 points, the Nasdaq rising almost 75 points, and the S&P 500 gaining more than 23 points.
Trump slammed the trade court's ruling as 'horrific' and a threat to 'presidential power,' in a Truth Social post Thursday night, marking his first public comments on the matter.
'Where do these initial three Judges come from? How is it possible for them to have potentially done such damage to the United States of America?' the president seethed in the 510-word-long post.
'Under this decision, Trillions of Dollars would be lost by our Country,' Trump argued, further describing the ruling 'Country threatening' and 'so wrong, and so political.'
He expressed hope that the Supreme Court 'QUICKLY and DECISIVELY' takes up the case and rules in his favor.
'The pause will not affect the negotiations in any way if people out there in the world simply look at the court decision,' White House trade adviser Peter Navarro told reporters following the order.
'The court was clear, as I said, that [the] President has broad authority to impose tariffs,' he added, in a nod to a passage from the lower court ruling that noted the president has other avenues apart from emergency powers to impose duties on imports.
'This morning, we were getting plenty of phone calls from countries saying, 'We saw the rule,' and so what we're going to continue to [do is] negotiate in good faith,' Navarro continued.
Meanwhile, Treasury Secretary Scott Bessent blasted the judicial back and forth over Trump's tariffs 'highly inappropriate.'
'It seems highly inappropriate for the judiciary to weigh in here, when the Senate had the opportunity to override the president and didn't,' Bessent told Fox News host Bret Baier, during an interview on 'Special Report.'
'In terms of separation of powers, the Senate has chosen not to exercise their powers, and the president absolutely has the right to set the trade agenda for the US,' he added, arguing that 'anything the courts do to get in the way harms the American people in terms of trade and in terms of tariff revenue' – the latter of which he described as 'substantial.'
Earlier Thursday, the White House had warned it would seek 'emergency relief' from the Supreme Court as soon as Friday if the appeals court did not stay the trade court's ruling.
4 The tariffs had been challenged by a dozen states and five small businesses — which the appeals panel gave until June 5 to respond to Thursday's stay.
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It argued the initial decision wrongly intruded upon Trump's executive authority.
The judges 'brazenly abused their judicial power to usurp the authority of President Trump to stop him from carrying out the mandate that the American people gave him,' White House press secretary Karoline Leavitt said during her regular media briefing.
She called on the high court to overturn the ruling, claiming the judges 'are threatening to undermine the credibility of the United States on the world stage.'
'The administration has already filed an emergency motion for a stay pending appeal and an immediate administrative stay to strike down this egregious decision. But ultimately, the Supreme Court must put an end to this for the sake of our Constitution and our country.'
4 Trump announcing tariffs on April 2.
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The three-judge panel on the Court of International Trade ruled that federal law does not grant Trump 'unbounded authority' to tax imports from around the world.
It blocked 6.7 percentage points worth of the levies and gave the White House 10 days to roll back the tariffs.
White House spokesman Kush Desai condemned the decision Wednesday evening, saying that unfair trade relationships had 'decimated American communities, left our workers behind and weakened our defense industrial base – facts that the court did not dispute.'
Morgan Stanley and Goldman Sachs on Thursday pointed out that Trump might be able to keep many of his tariffs in place by taking advantage of specific laws.
The court's Wednesday decision, for example, did not pause duties on steel, aluminum and auto imports, since these were enacted under Section 232 of the Trade Expansion Act, which allows the president to impose tariffs if excessive foreign imports pose a national security risk.
'The tariff levels that we had yesterday are probably going to be the tariff levels that we have tomorrow, because there are so many different authorities the administration can reach into to put it back together,' Michael Zezas, Morgan Stanley's global head of fixed income and thematic research, told Bloomberg TV on Thursday.
Trump's power to 'raise and escalate — it might be a little bit slower moving, but it is still there,' he added.
4 Wall Street finished higher on Thursday.
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Alec Phillips, chief US political economist at Goldman Sachs, wrote in a note to clients that the ruling 'represents a setback for the administration's tariff plans and increases uncertainty but might not change the final outcome for most major US trading partners.'
The Trump administration signaled it was unlikely to pursue alternative methods to levy tariffs while the court case plays out.
'There are different approaches that would take a couple of months,' Kevin Hassett, director of the National Economic Council, told Fox Business Network's 'Mornings with Maria' Thursday.
'But we're not planning to pursue those right now because we're very, very confident that this really is incorrect.'
Economists have warned that any tariffs will be passed on to consumers, leading to higher inflation and forcing Americans to spend less. Uncertainty over when or if the duties take effect is also likely to affect planned investment by businesses.
The prices of certain items have gone up in recent months. For example, the cost of new Samsung DU7200 TVs rose to $427 from $400 — an increase of 6.75% — in the past month, according to CNET price tracking data.
The price of an Xbox Series X spiked to $600 from $500 — a 20% rise — in the same period.
Goldman's Phillips noted he does not expect the court's ruling to impact the massive Republican tax bill that passed the House last week since 'tariff revenue was never counted toward offsetting the cost of the package.'
Yet the tariffs were likely to raise nearly $200 billion on an annual basis – approximately the same amount by which the spending bill would raise the deficit next year, Phillips wrote.
'For now, we expect the Trump administration will find other ways to impose tariffs,' he added, 'so we still expect most of this revenue to materialize.'
Capital markets analyst Adam Kobeissi estimates that around $10 billion worth of tariff revenue has been collected since Trump announced the 10% flat rate on dozens of countries April 2, the president's proclaimed 'Liberation Day.'
Additional reporting by Anthony Blair and Victor Nava