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The Hill
a day ago
- Business
- The Hill
Trade deals don't make Trump's emergency tariffs legal
President Trump has taken an expansive view of his authority to levy tariffs in his second term trade war with nearly every U.S. trading partner. Calling on the International Emergency Economic Powers Act, the Trump administration has imposed tariffs at rates not seen since the 1930s, claiming to address a national emergency caused by fentanyl trafficked across the border and persistent trade deficits. Defending those actions, on Monday, Trump's Justice Department entered an extraordinary letter into the tariff litigation now before the U.S. Court of Appeals for the Federal Circuit, which will soon issue a ruling. That letter points to a recurrent theme in Trump's trade approach, a weak legal foundation for his actions papered over with an even more flimsy rationale for preserving it. The letter from Solicitor General D. John Sauer and Assistant Attorney General Brett Shumate claims that President Trump's July announcement of 'the largest trade agreement in history' with the European Union, plus other recent deals with Indonesia, the Philippines, Japan and the United Kingdom, proved the tariffs should stay in place. That argument might make for a good press release. But in a court of law, it's entirely beside the point. The central question before the court isn't whether the president's tariffs have produced diplomatic headlines (even though they don't amount to much). It's whether the International Emergency Economic Powers Act gives the president the authority to impose them in the first place. Congress passed the act to give presidents a way to address genuine national emergencies, things like hostile foreign actions, espionage or terrorism — not as a catch-all to impose peacetime tariffs whenever it might create negotiating leverage. In fact, the U.S. Court of International Trade, whose decision to vacate Trump's tariffs is now under appeal, held that the government's argument for using tariffs to 'pressure' countries to address the proclaimed emergencies 'does not comfortably meet the statutory definition of 'dealing with' the cited emergency.' It reached that stance because the argument would allow the president 'to take whatever actions he chooses simply by declaring them 'pressure' or 'leverage' tactics' to extract concessions unconnected to the declared threat. The Justice Department continues to push for an expansive reading of the president's authority to levy tariffs. But the letter takes this a step further. It offers a string of doomsday predictions: Without international emergency powers tariffs, 'trillions of dollars' from other countries won't be paid, the U.S. could see a '1929-style result,' millions might lose their homes and jobs, even Social Security and Medicare could be 'threatened.' That's not legal analysis. It's fearmongering. And it's untethered from any evidence in the record. Most of the so-called deals are not even written down, or available to review. Of the announcements made on the content of those deals, serious questions have been raised about the level of commitments, and their durability. Furthermore, the promised investment may not even be possible, and contradict the president's goal of lowering the trade deficit, which is central to his actions under the International Emergency Economic Powers Act. It also contradicts the Justice Department's previous arguments for a stay of the lower court's ruling, claiming that the government could refund the tariffs if it lost the appeal. Even if the deals the president cites were, in fact, secured because of these tariffs, it still wouldn't make them legal. You don't get to break the law to make a deal, then point to the deal as proof the law should bend to fit your actions. That's bootstrapping, plain and simple. Nor is it true that the U.S. has no other trade tools at its disposal. There are various other trade authorities that the president could lean on. The president could also negotiate actual trade agreements with the support of Congress. The irony is that the Justice Department's own letter inadvertently proves the critics' point. If the president believes these tariffs are so essential, he should ask Congress for the authority to impose them. That's how the separation of powers works. In the meantime, the courts are there to ensure that even the most popular, politically expedient or 'powerful' policy stays within legal bounds. Tariffs based on the International Emergency Economic Powers Act were never legal. No amount of retroactive dealmaking can change that. Grasping at straws for a new rationale for Trump's self-inflicted tariff wound adds insult to that injury. The Court of Appeals should not be swayed by this desperate appeal. A clear and decisive ruling against the tariffs is necessary to stop further abuses of executive authority on trade, otherwise, this version of 'emergency powers' will become the new normal in U.S. trade law, and Americans will pay the price, not just in their wallets.
Newsweek
4 days ago
- Business
- Newsweek
Social Security Warning Issued by Solicitor General
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. The Department of Justice has warned that overturning tariffs imposed under the 1977 International Emergency Economic Powers Act (IEEPA) would risk a "1929-style" crisis that could endanger the country's social welfare programs. "In such a scenario, people would be forced from their homes, millions of jobs would be eliminated, hard-working Americans would lose their savings, and even Social Security and Medicare could be threatened," wrote the U.S. Solicitor General D. John Sauer, in a letter submitted to the U.S. Court of Appeals for the Federal Circuit on Monday. Why It Matters The federal appellate court is soon set to decide whether to uphold the Court of International Trade's (CIT) May ruling that President Donald Trump overstepped his executive authority when imposing the majority of his tariffs. While this order invalidating Trump's actions, and another order from the District Court for the District of Columbia, have been temporarily stayed, the outcome of the legal battle, which Trump has called "America's big case," could hold wide-reaching implications for the president's trade agenda and the economy as a whole. What To Know The IEEPA is a federal law granting the president the power to regulate commerce to address "an unusual and extraordinary threat" to the United States during national emergencies. In the case of Trump, persistent trade deficits and fentanyl smuggling are among the emergencies invoked for his tariffs on Canada, Mexico and China, as well as the "reciprocal" duties placed on dozens of America's trading partners. "The court does not read IEEPA to confer such unbounded authority and sets aside the challenged tariffs imposed thereunder," the three-judge panel of the CIT wrote in its May ruling. White House officials accused the CIT of mounting a "judicial coup," and immediately appealed the decision. The federal appeals court granted the White House a stay on May 29. U.S. Solicitor General D. John Sauer testifies during his Senate Judiciary Committee confirmation hearing on February 26, 2025. U.S. Solicitor General D. John Sauer testifies during his Senate Judiciary Committee confirmation hearing on February 26, 2025. Tom Williams/CQ Roll Call via AP Images The court heard oral arguments in the case earlier this month, and Reuters reports that the 11-judge panel was skeptical about the administration's rationale for using the 1977 law to justify the tariffs. Since late May, the Trump administration has struck deals with a handful of trading partners hoping to bring down their tariff rates. These include agreements with the European Union, Japan and South Korea, and involve investment commitments together totaling well over $1 trillion. In Monday's supplemental letter, rather than the potential legality of the CIT's ruling and the invocation of the IEEPA, the DOJ argued that overturning tariffs would jeopardize these deals and investments. The latter are not direct payments to the U.S., but rather financing for private-sector projects. However, Sauer and Assistant Attorney General Brett Shumate said: "The President believes that our country would not be able to pay back the trillions of dollars that other countries have already committed to pay, which could lead to financial ruin." "These deals for trillions of dollars have been reached, and other countries have committed to pay massive sums of money," they added. "If the United States were forced to unwind these historic agreements, the President believes that a forced dissolution of the agreements could lead to a 1929-style result." The argument echoes those recently made by Trump over the "big case." "If a Radical Left Court ruled against us at this late date, in an attempt to bring down or disturb the largest amount of money, wealth creation and influence the U.S.A. has ever seen, it would be impossible to ever recover, or pay back, these massive sums of money and honor," the president posted on Truth Social last week. What People Are Saying Solicitor General D. John Sauer and Assistant Attorney General Brett Shumate, in Monday's letter, wrote: "There is no substitute for the tariffs and deals that President Trump has made. One year ago, the United States was a dead country, and now, because of the trillions of dollars being paid by countries that have so badly abused us, America is a strong, financially viable, and respected country again. If the United States were forced to pay back the trillions of dollars committed to us, America could go from strength to failure the moment such an incorrect decision took effect." Scott Lincicome, economist at the Cato Institute, posted on X in response to the letter: "This is a letter signed by the US government's top lawyer and submitted today in federal court (in VOS Selections v Trump). I'm honestly struggling to believe it's real, but here we are." Economist David L. Ortega told Newsweek: "Ending the tariffs would not threaten Social Security or Medicare, which are funded through payroll taxes, not tariff receipts. Historically, high and sustained tariffs have posed greater economic risks than their removal. We saw this with the Smoot-Hawley Tariff Act in 1930. In fact, lifting these tariffs would more likely lower costs for U.S. producers and consumers than trigger a 1929-style collapse." Robert B. Koopman, a senior lecturer in Politics, Governance and Economics at the American University, told Newsweek that the letter was "factually incorrect" and "a pure political statement with no factual basis in economic or political reality." "This set of arguments [regarding Social Security] has no basis in fact or considered economic analysis—pure hyperbole." He added: "More economists are worried that the current set of [trade] agreements are likely to lead to economic slowdown and that U.S. growth would be stronger without them. No one is actually predicting a 1929 result with them or without them." What Happens Next In the letter, Trump's lawyers said that there exist alternative "tariff authorities" beyond the IEEPA that the president could employ depending on the outcome of the case. However, they described them as "short-term" and "not nearly as powerful," and said employing these would "render America captive to the abuses that it has endured from far more aggressive countries." It is unclear when the appellate court will issue its final ruling, but the case could potentially progress to the Supreme Court regardless of the outcome. Last week, former House Speaker Paul Ryan said the court was "more than likely" to strike down the president's use of the IEEPA for the bulk of his tariffs.
Politico
30-06-2025
- Business
- Politico
Supreme Court to hear case that could upend campaign finance coordination rules
The Supreme Court on Monday agreed to hear a Republican-led challenge to campaign finance limits on coordinated spending between candidates and political parties, potentially blowing up the money-in-politics landscape ahead of the 2026 midterms. A ruling in favor of the Republican plaintiffs would deliver the GOP's biggest campaign-finance win since the landmark 2010 Citizens United case, fundamentally changing how party committees spend tens of millions of dollars every election cycle, particularly on TV advertising. A GOP victory could allow party groups to pour unlimited amounts into ads in competitive races across the country, making it easier for campaigns to benefit from that spending. Republicans' top congressional campaign committees — the National Republican Senatorial Committee and the National Republican Congressional Committee — brought the case with then-Sen. JD Vance in 2023, arguing that federal law limiting coordination between candidates and political parties violates the First Amendment. The Supreme Court's decision to take up the case after the conservative 6th Circuit upheld the spending limits suggests the court is considering reversing decades-old precedent. And it comes after the Justice Department took the unusual step last month of choosing not to defend the constitutionality of the law and encouraging the high court to rule. 'In the Department's view, the challenged provision violates political parties' and candidates' core First Amendment rights under the Court's recent precedents on campaign-finance restrictions,' Solicitor General D. John Sauer said in a June letter to House Speaker Mike Johnson. Party committees can currently coordinate with candidates for between $63,600 and $127,200 in spending for House races, and $127,200 to $3,946,100 for Senate races, depending on the size of the district or state. Those funds often go to purchasing television ads, which are cheaper when bought in concert with a campaign than entirely by outside groups. If the limits on coordinated spending are overturned, party groups would dramatically accelerate their purchase of ad time. Democrats oppose the effort to overturn the limits, warning that doing so would cede political power to large donors. That would advantage Republicans, who generally rely less on small-donor fundraising. While individual donors can only give up to $3,500 to a campaign per election, they can send donations up to $44,300 per year to national party committees. The NRSC and NRCC hailed the court's decision to hear the case during its next term this fall. 'The government should not restrict a party committee's support for its own candidates,' Sen. Tim Scott and Rep. Richard Hudson — the chairs of the committees — said in a joint statement. 'Coordinated spending continues to be a critical part of winning campaigns, and the NRSC and NRCC will ensure we are in the strongest possible position to win in 2026 and beyond.' The court on Monday also allowed the Democratic National Committee, Democratic Senatorial Campaign Committee and Democratic Congressional Campaign Committee to join the case in opposition to the GOP. Those groups sought to intervene after the Justice Department declined to defend the law, and the Justice Department and the Republican plaintiffs told the court they did not mind the intervention. A victory for Republicans in this case is far from guaranteed, and some legal experts have already argued there's plenty of precedent to counter the core argument. They point to a 2001 Supreme Court ruling in which the court found 'little evidence to suggest that coordinated party spending limits adopted by Congress have frustrated the ability of political parties to exercise their First Amendment rights to support their candidates.' But the ideological makeup of the court was much different that year, and in that ruling, Justice Clarence Thomas — the only justice still serving from that time — dissented. 'This provision sweeps too broadly, interferes with the party-candidate relationship, and has not been proved necessary to combat corruption,' Thomas wrote at the time.
The Hill
20-06-2025
- Business
- The Hill
Supreme Court won't decide whether to take up Trump's tariffs before summer recess
The Supreme Court on Friday refused two small businesses' request to announce before the court's upcoming summer recess if it will take up their challenge to President Trump's emergency tariffs. Stressing the tariffs' sweeping impacts on the economy, the businesses are asking the justices to take up their challenge now rather than let it proceed through the lower courts in normal course. The justices have yet to decide whether they will do so. But in a brief order Friday, they refused the businesses' additional ask to expedite consideration so an announcement can be made before the summer recess, now just days away. That demand for speed was aimed at having the Supreme Court hear oral arguments as soon as September in the case, which concerns whether Trump can invoke an emergency law to justify his reciprocal 'Liberation Day' tariffs and others imposed on China, Canada and Mexico. By denying the request to expedite, the justices sided with the Trump administration in the procedural fight. The administration had told the court expediting 'makes little sense' and signaled it should wait for another case challenging Trump's tariffs, which is working its way through a separate appeals court. 'Once that Federal Circuit issues its decision, this Court would likely have an opportunity to determine whether to grant certiorari — and, if so, to hear the case during the October 2025 Term. That case would be a better vehicle than this one for resolving the question presented,' Solicitor General D. John Sauer wrote in court filings. The non-expedited schedule provides Sauer until mid-July to file the government's court papers formally asking the justices to turn away the current case. The businesses, Learning Resources and hand2mind, and their attorneys at law firm Akin will then have up to two weeks to file a reply brief. However, the justices generally hold petitions that become fully briefed over the summer until the start of the Supreme Court's next annual term in October. The government in its opposition reminded the justices they 'could release an order granting certiorari during the summer.'
E&E News
03-06-2025
- Business
- E&E News
Supreme Court requests DOJ input in utility antitrust petition
The Supreme Court is asking for the Justice Department's input on whether it should take up an antitrust case involving two southern utilities that could have broader implications for how courts evaluate business competition. On Monday, the justices invited Solicitor General D. John Sauer to file a brief on the case Duke Energy Carolinas v. NTE Carolinas II LLC. Duke Energy is aiming to overturn a 2024 lower bench ruling finding that a combination of actions the electric power company had taken involving Florida-based power supplier NTE could qualify as anticompetitive. At least four justices have to vote to take up a case. The solicitor general's view of the dispute's nationwide significance can be an important factor in deciding whether the justices will grant a petition. Advertisement The North Carolina-based company claims that a decision allowing a 4th U.S. Circuit Court of Appeals ruling to stand could revive a dormant legal theory that could open the door to more litigation among competing companies.
