The Supreme Court on Wednesday seemed skeptical of President Donald Trump’s authority to impose sweeping tariffs in a series of executive orders earlier this year. During more than two-and-a-half hours of oral arguments, a majority of the justices appeared to agree with the small businesses and states challenging the tariffs that they exceeded the powers given to the president under a federal law providing him the authority to regulate commerce during national emergencies created by foreign threats.
The law at the center of the case is the International Emergency Economic Powers Act. Enacted in 1977, the president can invoke it “to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy of the United States,” if he declares a national emergency “with respect to such threat.” Under Section 1702 of the law, when there is a national emergency, the president may “regulate … importation or exportation” of “property in which any foreign country or a national thereof has any interest.”
Relying on IEEPA, Trump issued a series of executive orders, beginning in February, that imposed two sets of tariffs. One set, often referred to as the “trafficking” tariffs, targeted products from China, Canada, and Mexico, which, Trump says, have not done enough to stop the flow of fentanyl into the U.S. A second set, known as the “reciprocal” tariffs, imposed an initial tariff of 10% on imports from almost all countries and even higher tariffs on products from dozens of countries. In imposing the reciprocal tariffs, Trump pointed to large trade deficits as an “unusual and extraordinary threat to the national security and economy of the United States.”
The dispute before the court on Wednesday stems from three challenges to the tariffs. Two different groups of small businesses, alleging that they face serious economic harm from the tariffs, filed lawsuits in the U.S. District Court for the District of Columbia and the U.S. Court of International Trade. A group of 12 states, led by Oregon, also brought a lawsuit in the Court of International Trade. The states’ lawsuit was joined with the case brought there by the small businesses.
The challengers contended that Trump did not have the power under IEEPA to impose the tariffs. The lower courts agreed, and in September the Supreme Court agreed to take up the dispute and fast-track it.
Representing the Trump administration, U.S. Solicitor General D. John Sauer told the justices that IEEPA “confers major powers to address major problems on the President, who is perhaps the most major actor in the realm of foreign affairs.” “The phrase ‘regulate … importation,’” he added, “plainly embraces tariffs, which are among the most traditional and direct methods of regulating importation.”
Neal Katyal, representing the small businesses, countered that the decision “comes down to common sense. It’s simply implausible,” he said, “that in enacting IEEPA Congress handed the President the power to overhaul the entire tariff system and the American economy in the process” – as evidenced by the fact that no other president in nearly 50 years “has ever tried to impose tariffs” relying on that law.
Sauer faced a barrage of questions from the court’s liberal justices. Justice Elena Kagan, for example, emphasized that Congress – not the president – had “the power to impose taxes, the power to regulate foreign commerce.” Justice Ketanji Brown Jackson pointed to what she described as the purpose of IEEPA, noting that the law “was designed and intended to limit presidential authority, that Congress was concerned about how presidents had been using the authority under the predecessor statute,” the Trading with the Enemy Act.
Additional skepticism came from Justice Neil Gorsuch, who raised two related objections to the powers that Trump is claiming. Gorsuch asked Sauer, on Trump’s theory, “what would prohibit Congress from just abdicating all responsibility to regulate foreign commerce, for that matter, [or] declare war to the President?” And a few minutes later, Gorsuch suggested that one problem with reading a law like IEEPA to give the president broad powers would be that it would create a “one-way ratchet toward the gradual but continual accretion of power in the executive branch” because, once the president had such powers, he could veto any effort by Congress to take them back.
Some of the other conservative justices joined Gorsuch in voicing skepticism. Chief Justice John Roberts, for example, suggested that Trump’s claim of power under IEEPA might violate the “major questions” doctrine – the idea that if Congress wants to grant power to make decisions of vast economic or political significance it must say so clearly. “The justification,” Roberts said, “is being used for a power to impose tariffs on any product from any country, in any amount for any length of time.”
Justice Amy Coney Barrett asked Sauer to point to other places in federal law where Congress used the phrase “regulate … importation” to give the president the power to impose tariffs. But she was also skeptical at times of the challengers’ arguments. Along with Justice Brett Kavanaugh, she pressed Benjamin Gutman, the solicitor general of Oregon, who represented the group of 12 states, about whether IEEPA on the one hand could give the president very broad powers – for example, allowing him to shut down all trade with another country – but on the other hand would not allow him to take the much smaller step, in her view, of imposing tariffs. Such a paradox, Kavanaugh suggested, created an “odd donut hole” in IEEPA.
Gutman later responded that other trade laws could allow the president to impose tariffs in such a situation.
Justice Samuel Alito also seemed sympathetic to the administration’s arguments, telling Katyal that statutes that confer real emergency powers are often phrased quite broadly. But it was not clear whether Alito had four other votes on his side.
The Trump administration and the challengers have both asked the court to move quickly in deciding the case, but there is no way to know exactly when that will be.
