Latest news with #nationalEmergency
Yahoo
2 days ago
- Business
- Yahoo
122, 232, 301, 338: The numbers key to Trump's tariff revival
No matter the outcome of a major legal case on President Donald Trump's tariffs, his import taxes are likely here to stay — in one form or another. Even before a Wednesday ruling that Trump overstepped his authority by using a national emergency to impose most of his tariffs, there had already been discussions inside the West Wing about options if the courts struck down his expansive and untested use of emergency authority, two senior administration officials told CNN. 'We really do think we have a strong case and will win,' one of the officials said. 'But we do have other tools that can get us to the same exact place we're ready to use if necessary.' Key to those efforts: using different trade-related laws to push forward more tariffs. Here are the most likely options the administration could tap into: This law allows a president to levy a tariff of up to 15% for a maximum of 150 days to address 'large and serious United States balance-of-payments deficits.' That would occur when the value of a country's imports far exceeds that of exports, also referred to as a trade deficit. The US currently runs an $87.6 billion goods trade deficit, according to advanced figures the Census Bureau released on Friday. Trump often claims large deficits are a sign the US is being 'ripped off' and treated unfairly. Many economists, however, are much less convinced of his argument, with some even noting that a trade deficit can be a reflection of a strong economy and the power of the US to effectively stimulate the global economy. Administration officials initially weighed using Section 122 to impose higher tariffs but decided not to, due to the 150-day limit. If the administration goes down this path, it could replace the current 10% universal baseline tariff on nearly every country's exports. After the 150-day period concludes, the levies can only continue if Congress signs off on them. This gives the president the authority to impose higher tariffs on national security grounds. It can only be used to target specific sectors and requires an investigation to be launched before tariffs can be imposed. For instance, a recent Section 232 investigation the administration launched into imports of critical minerals claimed that 'overreliance on foreign critical minerals and their derivative products could jeopardize US defense capabilities, infrastructure development, and technological innovation.' There are several other current Section 232 investigations concerning other sectors. The 25% across-the-board tariffs on steel, aluminum, cars and car parts were all the result of 232 investigations. These tariffs can continue to remain in place regardless of how the appeal on the allegedly emergency-related tariffs proceeds. 'Trump has not emphasized sectoral tariffs as frequently lately as he did earlier this year, but if the White House finds it has less flexibility on country-focused tariffs, sectoral tariffs might receive more attention again,' Goldman Sachs economists said in a recent note. This allows the USTR to investigate countries potentially violating other nations' trade agreements or practices in a way that is 'unjustifiable' and 'burdens or restricts' US business. Trump used Section 301 during his first term to hike tariffs on several Chinese imports, along with aircraft and other European Union goods. Ultimately, it could take weeks or even months for those investigations to lead to tariffs because of the lengthier process involved, including a period for public comment, compared to recently imposed tariffs. But, unlike Section 122, there's no limit to the level or duration of tariffs arising from Section 301 investigations. While never implemented by any president, Trump can use this law to impose tariffs of up to 50% on countries' imports if he believes they are engaging in trade practices that discriminate against the US. Doing so, however, could violate World Trade Organization agreement terms and prompt steep retaliation from impacted countries. Despite the clear setback delivered by the courts, administration officials insist nothing has shifted in Trump's thinking. That message is in part one of necessity, given that the threat of dramatically higher tariff rates is the central leverage the administration is using in the 18 separate bilateral trade talks that the administration says are underway. 'President Trump is 100% serious about this,' one official told CNN. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNN
2 days ago
- Business
- CNN
122, 232, 301, 338: The numbers key to Trump's tariff revival
No matter the outcome of a major legal case on President Donald Trump's tariffs, his import taxes are likely here to stay — in one form or another. Even before a Wednesday ruling that Trump overstepped his authority by using a national emergency to impose most of his tariffs, there had already been discussions inside the West Wing about options if the courts struck down his expansive and untested use of emergency authority, two senior administration officials told CNN. 'We really do think we have a strong case and will win,' one of the officials said. 'But we do have other tools that can get us to the same exact place we're ready to use if necessary.' Key to those efforts: using different trade-related laws to push forward more tariffs. Here are the most likely options the administration could tap into: This law allows a president to levy a tariff of up to 15% for a maximum of 150 days to address 'large and serious United States balance-of-payments deficits.' That would occur when the value of a country's imports far exceeds that of exports, also referred to as a trade deficit. The US currently runs an $87.6 billion goods trade deficit, according to advanced figures the Census Bureau released on Friday. Trump often claims large deficits are a sign the US is being 'ripped off' and treated unfairly. Many economists, however, are much less convinced of his argument, with some even noting that a trade deficit can be a reflection of a strong economy and the power of the US to effectively stimulate the global economy. Administration officials initially weighed using Section 122 to impose higher tariffs but decided not to, due to the 150-day limit. If the administration goes down this path, it could replace the current 10% universal baseline tariff on nearly every country's exports. After the 150-day period concludes, the levies can only continue if Congress signs off on them. This gives the president the authority to impose higher tariffs on national security grounds. It can only be used to target specific sectors and requires an investigation to be launched before tariffs can be imposed. For instance, a recent Section 232 investigation the administration launched into imports of critical minerals claimed that 'overreliance on foreign critical minerals and their derivative products could jeopardize US defense capabilities, infrastructure development, and technological innovation.' There are several other current Section 232 investigations concerning other sectors. The 25% across-the-board tariffs on steel, aluminum, cars and car parts were all the result of 232 investigations. These tariffs can continue to remain in place regardless of how the appeal on the allegedly emergency-related tariffs proceeds. 'Trump has not emphasized sectoral tariffs as frequently lately as he did earlier this year, but if the White House finds it has less flexibility on country-focused tariffs, sectoral tariffs might receive more attention again,' Goldman Sachs economists said in a recent note. This allows the USTR to investigate countries potentially violating other nations' trade agreements or practices in a way that is 'unjustifiable' and 'burdens or restricts' US business. Trump used Section 301 during his first term to hike tariffs on several Chinese imports, along with aircraft and other European Union goods. Ultimately, it could take weeks or even months for those investigations to lead to tariffs because of the lengthier process involved, including a period for public comment, compared to recently imposed tariffs. But, unlike Section 122, there's no limit to the level or duration of tariffs arising from Section 301 investigations. While never implemented by any president, Trump can use this law to impose tariffs of up to 50% on countries' imports if he believes they are engaging in trade practices that discriminate against the US. Doing so, however, could violate World Trade Organization agreement terms and prompt steep retaliation from impacted countries. Despite the clear setback delivered by the courts, administration officials insist nothing has shifted in Trump's thinking. That message is in part one of necessity, given that the threat of dramatically higher tariff rates is the central leverage the administration is using in the 18 separate bilateral trade talks that the administration says are underway. 'President Trump is 100% serious about this,' one official told CNN.
CNN
2 days ago
- Business
- CNN
122, 232, 301, 338: The numbers key to Trump's tariff revival
No matter the outcome of a major legal case on President Donald Trump's tariffs, his import taxes are likely here to stay — in one form or another. Even before a Wednesday ruling that Trump overstepped his authority by using a national emergency to impose most of his tariffs, there had already been discussions inside the West Wing about options if the courts struck down his expansive and untested use of emergency authority, two senior administration officials told CNN. 'We really do think we have a strong case and will win,' one of the officials said. 'But we do have other tools that can get us to the same exact place we're ready to use if necessary.' Key to those efforts: using different trade-related laws to push forward more tariffs. Here are the most likely options the administration could tap into: This law allows a president to levy a tariff of up to 15% for a maximum of 150 days to address 'large and serious United States balance-of-payments deficits.' That would occur when the value of a country's imports far exceeds that of exports, also referred to as a trade deficit. The US currently runs an $87.6 billion goods trade deficit, according to advanced figures the Census Bureau released on Friday. Trump often claims large deficits are a sign the US is being 'ripped off' and treated unfairly. Many economists, however, are much less convinced of his argument, with some even noting that a trade deficit can be a reflection of a strong economy and the power of the US to effectively stimulate the global economy. Administration officials initially weighed using Section 122 to impose higher tariffs but decided not to, due to the 150-day limit. If the administration goes down this path, it could replace the current 10% universal baseline tariff on nearly every country's exports. After the 150-day period concludes, the levies can only continue if Congress signs off on them. This gives the president the authority to impose higher tariffs on national security grounds. It can only be used to target specific sectors and requires an investigation to be launched before tariffs can be imposed. For instance, a recent Section 232 investigation the administration launched into imports of critical minerals claimed that 'overreliance on foreign critical minerals and their derivative products could jeopardize US defense capabilities, infrastructure development, and technological innovation.' There are several other current Section 232 investigations concerning other sectors. The 25% across-the-board tariffs on steel, aluminum, cars and car parts were all the result of 232 investigations. These tariffs can continue to remain in place regardless of how the appeal on the allegedly emergency-related tariffs proceeds. 'Trump has not emphasized sectoral tariffs as frequently lately as he did earlier this year, but if the White House finds it has less flexibility on country-focused tariffs, sectoral tariffs might receive more attention again,' Goldman Sachs economists said in a recent note. This allows the USTR to investigate countries potentially violating other nations' trade agreements or practices in a way that is 'unjustifiable' and 'burdens or restricts' US business. Trump used Section 301 during his first term to hike tariffs on several Chinese imports, along with aircraft and other European Union goods. Ultimately, it could take weeks or even months for those investigations to lead to tariffs because of the lengthier process involved, including a period for public comment, compared to recently imposed tariffs. But, unlike Section 122, there's no limit to the level or duration of tariffs arising from Section 301 investigations. While never implemented by any president, Trump can use this law to impose tariffs of up to 50% on countries' imports if he believes they are engaging in trade practices that discriminate against the US. Doing so, however, could violate World Trade Organization agreement terms and prompt steep retaliation from impacted countries. Despite the clear setback delivered by the courts, administration officials insist nothing has shifted in Trump's thinking. That message is in part one of necessity, given that the threat of dramatically higher tariff rates is the central leverage the administration is using in the 18 separate bilateral trade talks that the administration says are underway. 'President Trump is 100% serious about this,' one official told CNN.
ABC News
3 days ago
- Business
- ABC News
Tariffs a sideshow to greater US problem: economist
Samantha Donovan: Well up until the last couple of weeks, the financial markets have swung wildly after Donald Trump's every utterance on tariffs. Recent reaction to the President's trade policy shifts has been more muted though. Australian Justin Wolfers is a Professor of Economics and Public Policy at the University of Michigan. He told our business correspondent David Taylor, tariffs are now a sideshow to a much greater concern for the international community. Justin Wolfers: The Constitution gives the power over tariffs to Congress, not the White House. Now over the years, Congress has given some of that power, handed it off to the White House, but only in a very limited and constrained way. So a simple reading of the rules would say the President can't do this. So in order to have across the board tariffs or what he calls reciprocal tariffs on every country in the world, he's had to call it a national emergency and invoke the Emergency Powers Act, which is interesting, first of all, because that act says nothing about tariffs. And secondly, there's no emergency. The so-called emergencies, the US has trade deficits with many countries. Bilateral trade deficits are not themselves a problem. So it's been in the works that this was going to get knocked down and it finally hit court last night. The court said this is quite clearly unconstitutional. It was a three judge panel, an Obama judge, a Reagan judge, and a Trump judge. So it seems like a pretty clear decision. So that all seemed pretty clear until the US federal government, the Trump administration, filed an appeal with the Court of Appeals. The Court of Appeals unsurprisingly agreed to hear the case. And while it's waiting to get its work done, so while they're reading the documents and so on, it decided to stay, that is to say reinstate the Trump tariffs. All of this is going to be on a pretty expedited schedule. So within a couple of weeks, they're going to come back with their decision. If, as I expect, they find this to be unconstitutional, then the tariffs will be back off again. Then we'll be off to the Supreme Court. We'll see the same drama play out one more time. And then what happens after that is what's really interesting. Because this is saying you can't have across the board tariffs, but recall Congress delegates certain tariff powers to the White House. And it turns out there's a lot of other statutory authorities that they could use. They're a little narrower. And so for instance, that's why the tariffs on steel and aluminium and cars are going to persist because they did not come through this overreach. And it would be easy to get further tariffs on semiconductors and pharmaceuticals and so on. So my guess is the White House lawyers are just going to find other ways of creating international trade havoc. David Taylor: That kind of goes to my next question though, Justin Wolfers, based on your understanding of recent history and Donald Trump, what is, and I know this is a very complicated and difficult question to answer, but where is Donald, where would you think that Donald Trump's mind is at? What do you think his next move is likely to be? Justin Wolfers: His lawyers will be telling him as of this afternoon, Mr. President, the statutory authority we were using will come under question. But if you want to push ahead with tariffs, I've got lots of other ways that you can do it. My guess based on past history is he'll say that's terrific. Let's keep going. David Taylor: Given that, and given how much you know that financial markets can't stand uncertainty, the market reaction, the financial markets reaction over the past 24 hours, I would describe as being quite muted compared to... Justin Wolfers: I agree. David Taylor: Yeah, why? Why? Justin Wolfers: Yeah, I've given this a lot of thought. So the S&P 500 rose one and a half percent when this was announced. That's quite muted given that the day that Trump... So, and this announced all of these tariffs are illegal and they're off. Compare that to seven days after Liberation Day when Trump announced a 90-day pause on the tariffs that led US stocks to rise by about 9%, like six times more for a pause as opposed to it's unconstitutional and you can't do it. So a few thoughts here. One is perhaps this is markets betting that this is going to be overturned at a later point. Another possibility is markets, even if markets don't think it's going to be overturned, and I don't think it's going to be overturned, I think the use of the Emergency Powers Act will be ruled unconstitutional. But even so, Trump has other ways of imposing tariffs. So I suspect that this is markets understanding someone's getting in the way of Trump creating tariffs the way he wants to, but he's probably just going to come back and do it a different way. If you're really interested in this, I'm going to give you one more interpretation. So the markets were incredibly volatile in early April when he announced Liberation Day tariffs, they tanked. When he paused, they soared. They acted like this was a huge thing. Now there's two interpretations of that. One, markets believe that tariffs are so fundamentally important to the profitability of American businesses they have no choice but to rise and fall dramatically every time something happens. If that were true, then you would have thought that the Supreme Court making it unconstitutional should have caused markets to absolutely soar today, and they merely rose a little. So the other possibility is that the original policy announcement was so incoherent, so poorly thought through, so dramatic, so unconstitutional on its face, so absurd, so much overreach in both the economic, political, and legal domains that it signalled an administration that's out of control, and that could do a lot of damage. And so maybe that's what markets were learning in early April. They reacted a little bit to tariffs and a huge amount to learning that this is an economically unhelpful administration. And if that's the case, then all that we learned today, when the courts say Trump wasn't allowed to do tariffs in a particular way, you're only going to see a small reaction because it's still true that the White House is full of lunatics, and that still weighs on people's minds. Samantha Donovan: Professor Justin Wolfers from the University of Michigan. He was speaking with our business correspondent, David Taylor.
Washington Post
4 days ago
- Business
- Washington Post
Trump's big plans on trade and more run up against laws of political gravity, separation of powers
WASHINGTON — Once again, President Donald Trump's biggest policy plans were stopped in their tracks. On Wednesday, an obscure but powerful court in New York rejected the legal foundation of Trump's most sweeping tariffs , finding that Trump could not use a 1977 law to declare a national emergency on trade imbalances and fentanyl smuggling to justify a series of import taxes that have unsettled the world. Reordering the global economy by executive fiat was an unconstitutional end-run around Congress' powers, the three-judge panel of Trump, Obama and Reagan appointees ruled in a scathing rebuke of Trump's action.
