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Politico
2 hours ago
- Business
- Politico
Trump's move-fast-and-break-things tariff strategy collides with reality
President Donald Trump's move-fast-and-break-things ethos this week led to a major setback for his trade policy, leaving the White House scrambling to chart its way around a potentially devastating legal ruling. Yet with the central element of his economic agenda in jeopardy, Trump is digging in on his vow to impose steep tariffs by any means necessary — and stick it to those who question his strength and think he's bound to 'chicken out.' He and administration officials have said that negotiations with other countries will continue, are insisting they'll win their current tariff battle in court and are even preparing back-up strategies for new tariffs in case they don't. Trump's determination to move fast could slow implementation of his tariff regime. It also threatens to cost him credibility with businesses he's counting on to invest in the U.S. and world leaders whose buy-in he needs to negotiate trade deals. Still, few expect a different posture from a famously intransigent president or any second-guessing following the Wednesday ruling from the U.S. Court of International Trade, which briefly halted most of the tariffs. 'I don't think that's going to stop, in any way, the administration. The president's going to try to assert his tariff authority under any avenue possible,' said Marc Short, who served as Trump's legislative affairs director and Vice President Mike Pence's chief of staff during the president's first term. 'The president is not one to accept defeat. He certainly didn't in 2020. It's not like because he had a bad court ruling he's going to turn his back on this.' Trump and his top lieutenants see the speed with which he is moving to enact not just trade policy but his entire agenda as a feature, not a bug. Trade adviser Peter Navarro, who has been with Trump since his first term, often refers to the pace as 'Trump time,' and other senior White House staff members frequently chalk up any inconsistency or volatility in the president's policymaking approach to his dealmaking acumen. 'We have to act fast,' Trump told reporters in the Oval Office on Friday afternoon. 'We have to be fast and nimble.' And Trump may be especially keen on refuting the notion that he is weak after the moniker TACO, or 'Trump Always Chickens Out,' caught on among Wall Street traders, said one Trump ally outside the White House, granted anonymity to speak candidly. 'I don't think Trump can back down now, mainly because of this TACO theme,' the person said. 'He's clearly super irritated by it and it's like a challenge to his very manhood now.' European leaders have continued to chafe at the U.S.'s erratic approach to trade, a preview of what Trump might face at the G7 summit next month in Canada as he arrives with a slightly less-firm negotiating position. Still, the president has shown no inkling that he plans to back away from tariffs, which he's often called the 'most beautiful word' in the English language. Inside the West Wing, aides downplayed the legal whiplash as a minor stumbling block rather than a major threat to a trade policy seen as increasingly central to the president's economic legacy. And while they bristled at the TACO-centric talk, there was no expectation that Trump would veer off his maximalist trade push. 'He's been consistent on tariffs and trade since the 1980s,' said a White House official, granted anonymity to discuss internal deliberations. 'He's not firm on this because somebody made a taco meme and it's going viral.' Administration officials are readying backup plans should the broad set of levies they have placed on U.S. trading partners be again put on hold in court, which trade attorneys and others around the administration expect when an appeals court revisits the matter in June. Among them is a mechanism that would allow it to quickly impose tariffs without congressional approval or a more burdensome evidence-gathering and review process, according to two people familiar with discussions about the administration's trade strategy, granted anonymity to discuss strategy, one of several under consideration, would allow the president to replace existing 10 percent across-the-board tariffs on countries with levies of up to 15 percent, but only for six months. After that, Trump would need Congress' approval to extend them. 'It's important to understand that the president's trade team has been thinking about these legal tools for years, right? We have a lot of folks on TV and the internet who've been thinking about it for about six minutes,' said U.S. Trade Representative Jamieson Greer during an interview on CNBC Friday morning. 'So, of course, these are things that we've been considering and talking about for a very long time. All these things are on the table.' But so-called Section 122 tariffs — named for the part of the Trade Act that outlines them — have never been tested in court, meaning the administration could find itself stymied once again. In order to move quickly to enact the so-called Liberation Day tariffs, the White House leaned on emergency powers in a federal law known as IEEPA, an approach that a federal court on Wednesday said exceeded his legal authority. 'Whether you move forward under IEEPA or a different authority, the president has made clear that tariffs are a central plank of his economic agenda and he is going to use the leverage the tariffs create to drive better outcomes for the U.S.,' said Everett Eissenstat, who served as deputy director of the National Economic Council and a key trade adviser in Trump's first term. 'Whether this tool is the tool or there's another tool, tariff authority, he's going to move forward.' But even Trump allies fear that those in the White House aren't doing enough to counsel the president on his best options, leaning into his desire to move quickly without presenting him with a full suite of more durable strategies. 'Whether you're for tariffs or not, it's pretty clear the president doesn't have unilateral authority to raise taxes,' said Stephen Moore, an outside economic adviser to Trump who has long been skeptical of the administration's go-it-alone trade approach. 'It's pretty clear that at some point Congress is going to have to vote on tariff policy.' As advisers mulled strategies to see their way through the thicket of looming legal challenges, Trump sought to demonstrate resolve. After a long social media post on Thursday night blasting the International Court of Trade and a ruling that he said 'would completely destroy Presidential Power,' Trump continued posting on Friday morning with a broadside aimed at Chinese President Xi Jinping. Claiming that his drastic reduction of the 145 percent tariffs against Beijing was a matter of saving China from 'grave economic danger,' Trump asserted that it 'HAS TOTALLY VIOLATED ITS AGREEMENT WITH US.' Greer attributed the president's frustration to the Chinese 'slow-rolling their compliance' with the agreement hashed out earlier this month. And in perhaps the clearest sign of the president's defensiveness in the face of Wall Street criticism, Trump opened a long, freewheeling Oval Office press conference on Friday afternoon by directing an aide to position an iPad on the Resolute Desk from which he played a clip of CNBC's Rick Santelli — whose 2009 rant gave birth to the Tea Party movement — praising his economic record. As the clip played, Trump raised his eyebrows and nodded at the journalists and aides positioned in front of him. 'Not bad, right?' Trump said when the clip finished playing, as departing adviser Elon Musk implored people in the room to applaud.
Yomiuri Shimbun
6 hours ago
- Business
- Yomiuri Shimbun
U.S. Tariffs Blocked: Can Judiciary Prevent The President from Abusing Power?
Whether the principle of checks and balances, which has been in place since the founding of the United States to prevent a president from abusing their power, still functions properly is being tested. The tariff policy of the administration of U.S. President Donald Trump has created a situation in which the future of U.S. democracy is in question. The U.S. Court of International Trade ruled that the Trump administration's 'reciprocal tariffs' imposed on countries and regions around the world and other measures are illegal and invalid and ordered a permanent injunction. The ruling said the Constitution in principle gives Congress the power to lay and collect taxes and other such matters. As to the International Emergency Economic Powers Act (IEEPA), which the administration cited as grounds for imposing Trump's tariffs, the court argued the law does not confer on the president such unbound authority. The U.S. Court of Appeals for the Federal Circuit, which serves as the court of second instance, suspended the enforcement of the lower court ruling, and a thorough review of the appropriateness of the tariffs will be carried out. The case will likely be brought to the Supreme Court. Although the tariffs issue will likely see a lot of twists and turns, there is no doubt that this ruling has dealt a blow to the Trump administration's signature policy. The lawsuit was filed by small and medium-sized U.S. companies and 12 states, including New York and Arizona. This shows that dissatisfaction with the tariff policy is growing not only overseas but also within the United States. Shouldn't Trump face the criticism head-on and reconsider the tariff policy? In the United States, authority over tariffs and trade is primarily vested in Congress, while certain powers are delegated to the president through various laws. The IEEPA was enacted in 1977. In cases in which there is an 'unusual and extraordinary threat' to national security, foreign policy or the economy of the United States, the president can impose restrictions on imports and exports without prior examination after declaring a state of national emergency. Previously, the IEEPA has been mainly applied to economic sanctions against countries such as North Korea and Iran. The Trump administration was the first to impose tariffs under the law. The administration argues that the massive trade deficit poses a threat to national security. However, as the latest ruling shows, doubts about the validity of such an argument for the tariffs remain strong. Since its founding, the United States has thoroughly upheld the separation of powers among the judicial, legislative and executive branches as the foundation of democracy. This system in which the three powers keep each other in check has prevented the emergence of authoritarian rule and protected the freedom and rights of the people. However, with both the House of Representatives and the Senate being controlled by the Republican Party, which has become increasingly Trump's party, the checks and balances are not functioning as they should. Amid growing concerns over Trump abusing his power, the ruling demonstrates that the judiciary can serve as a check on that power to a certain degree. If the court ultimately rules that the reciprocal tariffs are illegal, they will lose their efficacy. This could also influence the negotiation strategies of other countries. The Japanese government must carefully analyze the details of the ruling and future developments. (From The Yomiuri Shimbun, May 31, 2025)
Yahoo
14 hours ago
- Business
- Yahoo
New lawsuit seeks to force return of collected tariffs following court ruling
A new lawsuit filed in the U.S. Court of International Trade seeks to force the Trump administration to return tariffs it collected under the president's 'Liberation Day' announcement now that the court has ruled them unlawful. Chapter1 LLC, a Las Vegas-based skincare start-up, said it paid nearly $23,000 under the challenged tariffs when it imported a custom machine to mix its serum and toner products from China. The suit says the company's owner, 25-year-old Ali Shaubzada, ordered the machine in the fall, using most of his savings and business lines of credit. It arrived in the U.S. earlier this month, with the duties outpacing the roughly $16,000 cost of the machine itself. 'To pay for this unexpectedly large bill, Ali had to take out a personal loan,' the complaint reads. The class-action suit seeks to recover Chapter1's tariff payment and the billions in payments made by businesses across the country following Trump's announcements. 'Hundreds of thousands of other American businesses have exactly the same claim, based on exactly the same legal theory, against the United States: Each importer has a claim against the United States for repayment of the tariffs it paid,' the lawsuit states. Chapter1 is represented by Gerstein Harrow. The Hill has reached out to the Justice Department for comment. The suit, filed Thursday, comes a day after the trade court invalidated the bulk of Trump's tariffs. The three-judge panel unanimously ruled that the administration's broad interpretation of the International Emergency Economic Powers Act (IEEPA), a federal law that authorizes the president to impose necessary economic sanctions during a national emergency, is unconstitutional. Trump previously cited trade deficits as emergency justification to impose his 'Liberation Day' tariffs, which imposed a 10 percent rate on all imports and higher, reciprocal tariffs on dozens of U.S. trading partners. Wednesday's ruling also blocked Trump's IEEPA tariffs on Mexico, Canada and China dating back to February that pointed to an influx of fentanyl coming across the border. The U.S. Court of Appeals for the Federal Circuit temporarily lifted the order on Thursday but is expected to issue a new ruling after receiving written arguments from the parties in the coming days. Separately, a federal district judge in the nation's capital blocked Trump's use of IEEPA in response to another lawsuit. The administration has appealed that ruling, too. But the judge provided two weeks before his order goes into effect, meaning that no court injunction is currently blocking any of Trump's tariffs, for now. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Hamilton Spectator
15 hours ago
- Business
- Hamilton Spectator
S&P/TSX composite slides on Friday but caps off month near record highs
Canada's main stock index on Friday continued to trim the gains that pushed it to a record closing high two days earlier, as investors retreated to defensive stocks while energy and information technology took a hit. 'It's been another roller-coaster day in markets, capping off generally strong equity index returns for the month,' said Kathrin Forrest, equity investment director at Capital Group. The S&P/TSX composite index inched down 35.51 points to 26,175.05. In New York, the Dow Jones industrial average rose 54.34 points to 42,270.07. The S&P 500 index slipped 0.48 points to 5,911.69, while the Nasdaq dipped 62.11 points to 19,113.77 — but both logged their biggest monthly percentage gains since November 2023. Investors in the U.S. shored up their stakes in telecom companies, utilities and consumer staples and shied away from resource and IT firms. 'We see the same defensive bias there,' Forrest said of Canada. 'Uncertainty is clearly one of the recurring, underlying themes. And with that you see some volatility' — in energy due to supply concerns and in tech thanks to U.S.-China trade tensions — she said. 'Staples you generally would expect to hold up better in times when there's some uncertainty around.' The S&P/TSX achieved its third-highest close ever on Friday, in spite of ongoing anxiety over the tariff war. 'Overall, we have continued to see relatively strong underlying economic data,' Forrest said. 'Despite all the headlines and the concerns around trade and uncertainty in that regard, the underlying fundamental data, in particular in the U.S., has largely held up well.' This week and month on Wall Street have been dominated by questions about what will happen with Trump's tariffs, which investors worry could grind the economy into a recession, slash companies' profits and pile even more challenges on households already dealing with the high cost of living. Hopes had largely been rising that the worst of such worries had passed, which in turn sent stocks rallying, after Trump paused his tariffs on both China and the European Union. A U.S. court then on Wednesday blocked many of Trump's sweeping tariffs. That allowed the S&P 500 to notch its first winning month in four and its best in a year and a half. But the tariffs remain in place for now while the White House appeals the ruling by the U.S. Court of International Trade, and the ultimate outcome is still uncertain. Trump also briefly shook markets shortly before Wall Street opened for trading Friday, when he accused China of not living up to its end of the agreement that paused their tariffs against each other. On Bay Street, investors will be watching whether the Bank of Canada will cut interest rates on Wednesday. 'Currently the market is pricing a 20 per cent chance of a cut. That is down from a 67 per cent chance just two weeks ago,' Forrest said. The shift stems from a surprising 2.2 per cent annualized rise in economic output in the first quarter of 2025 that Statistics Canada reported Friday, up a tick from 2.1 per cent in the fourth quarter. Market watchers will also be on the lockout for national employment figures slated to drop on June 6. The Canadian dollar traded for 72.68 cents US compared with 72.43 cents US on Thursday. The July crude oil contract was down 15 cents US at US$60.79 per barrel and the July natural gas contract was down seven cents US at US$3.45 per mmBTU. The August gold contract was down US$28.50 at US$3,315.40 an ounce and the July copper contract was flat at US$4.68 a pound. — With files from The Associated Press This report by The Canadian Press was first published May 30, 2025. Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Hill
16 hours ago
- Business
- The Hill
New lawsuit seeks to force return of collected tariffs following court ruling
A new lawsuit filed in the U.S. Court of International Trade seeks to force the Trump administration to return tariffs it collected under the president's 'Liberation Day' announcement now that the court has ruled them unlawful. Chapter1 LLC, a Las Vegas-based skincare start-up, said it paid nearly $23,000 under the challenged tariffs when it imported a custom machine to mix its serum and toner products from China. The suit says the company's owner, 25-year-old Ali Shaubzada, ordered the machine in the fall, using most of his savings and business lines of credit. It arrived in the U.S. earlier this month, with the duties outpacing the roughly $16,000 cost of the machine itself. 'To pay for this unexpectedly large bill, Ali had to take out a personal loan,' the complaint reads. The class-action suit seeks to recover Chapter1's tariff payment and the billions in payments made by businesses across the country following Trump's announcements. 'Hundreds of thousands of other American businesses have exactly the same claim, based on exactly the same legal theory, against the United States: Each importer has a claim against the United States for repayment of the tariffs it paid,' the lawsuit states. Chapter1 is represented by Gerstein Harrow. The Hill has reached out to the Justice Department for comment. The suit, filed Thursday, comes a day after the trade court invalidated the bulk of Trump's tariffs. The three-judge panel unanimously ruled that the administration's broad interpretation of the International Emergency Economic Powers Act (IEEPA), a federal law that authorizes the president to impose necessary economic sanctions during a national emergency, is unconstitutional. Trump previously cited trade deficits as emergency justification to impose his 'Liberation Day' tariffs, which imposed a 10 percent rate on all imports and higher, reciprocal tariffs on dozens of U.S. trading partners. Thursday's ruling also blocked Trump's IEEPA tariffs on Mexico, Canada and China dating back to February that pointed to an influx of fentanyl coming across the border. The U.S. Court of Appeals for the Federal Circuit temporarily lifted the order on Thursday but is expected to issue a new ruling after receiving written arguments from the parties in the coming days. Separately, a federal district judge in the nation's capital blocked Trump's use of IEEPA in response to another lawsuit. The administration has appealed that ruling, too. But the judge provided two weeks before his order goes into effect, meaning that no court injunction is currently blocking any of Trump's tariffs, for now.
