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The threat by former President Donald Trump to impose a 60 percent additional tariff on goods from China and an additional 10 percent tariff on the products of everyone, friend and foe alike, if he is elected, raises an urgent and pertinent legal question: Can he really do that? The short answer: The China tariff, perhaps, depending on the rationale he used. The additional tariff on the goods of all others would be less likely to survive a challenge. The actions he took during his term have been upheld to date. What would be different about these new threats?
First, Trump’s proposed use of the authorities granted by Congress would be far more sweeping than what he did before. Second, there is a sense that the tolerance of the Supreme Court for aggressive executive action using delegated authorities in general is running out: A pending decision before the Court may end or limit a key doctrine in administrative law, known by lawyers as the Chevron doctrine, under which the courts defer to executive branch agencies to decide how best to implement the statutory authority Congress has vested in them. The irony is that it may be the conservative justices, several of whom Trump appointed, who most disapprove of the current practice of according deference to the executive branch, as they seek to curb what they regard as the growth of an “administrative state.” The actions threatened by Trump run in the opposite direction—toward an unrestrained executive branch.
Wholly missing from this picture of Trump’s tariff plans is any reported mention of his getting specific authority from Congress to levy the increased tariffs. Article I, section 1, clause 8 of the US Constitution provides: “The Congress shall have the Power … To regulate Commerce with foreign Nations, and among the several States…”. But the framers of the Constitution also understood that Congress would not be able to administer laws as questions arise daily. For administering the laws, Congress must rely on the executive branch—the president and the personnel and agencies responsible to him or her. This poses an important legal question.
How much can be delegated by Congress before it becomes constitutionally impermissible, and, conversely, how much of the commerce power can simply be taken by the executive branch when it deems it necessary or appropriate to implement congressional directives? The question has come up before with Trump, who had pledged in 2016 to withdraw from the Trans-Pacific Partnership: “Can he do this?” Answer: Yes, he could, and then did. He also vowed to withdraw from the World Trade Organization (WTO). Answer: Unclear whether he had the authority to do so, since it was an agreement approved by the Congress and parts were implemented by statute. In any event, he didn’t try.
Added to this mix is one more consideration: If the nation’s security is invoked, the courts tend to give much wider latitude to the president to regulate commerce under its delegations of emergency authorities. The Court of Customs and Patent Appeals found that President Nixon had sufficient delegated authority to place a 10 percent additional tax for four months on imports when the dollar and the international financial system were under attack. It cited the president’s wartime authority as sufficient to cover this action (the Trading with the Enemy Act, October 6, 1917). There are limits, however. In a case not involving trade, President Truman was not allowed to nationalize the steel mills even during wartime to get past a labor strike. The justices wrote, "the President's power to see that the laws are faithfully executed refutes the idea that he is to be a lawmaker."
It was in this legal setting that President Trump decided that placing restrictions on steel and aluminum imports, both from a strategic competitor (China) and from allies (Canada, Japan Europe, etc.), involved a valid finding of a threat to the nation’s security and therefore restrictions were justified under existing authority. The Congress had delegated to the executive branch the authority to determine if the national security was impaired by imports. It exercised the delegated authority, made its finding, and the president acted. Upon taking office in 2021, President Joseph R. Biden, Jr. agreed with Trump’s action and kept import restrictions in place. Although not free from court challenge, the administration checked the boxes that the Congress had laid out, and the courts upheld the steel and aluminum measures under the national security authority.
Placing a series of additional tariffs (up to 25 percent) on most Chinese products, as Trump did, rested primarily on a different footing—the retaliatory authority that the Congress granted the president in the Trade Act of 1974. Trump (through his trade representative) found that China had engaged in unfair acts with respect to American trade. President Biden, for his part, kept the China tariffs in place as well. Using retaliatory authority against most trade with a country was groundbreaking. The statute previously was seen as providing a rifle shot, narrowly aimed to defend the nation’s commercial interests in a particular product sector. The authority had previously been used, for example, to impose retaliatory measures to counter Japan’s market closure to semiconductors in the 1980s and the European Union's Airbus subsidies harming sales of Boeing planes.
Increased tariffs on a wide swath of Chinese products as undertaken by Trump covered new legal ground. While there is no evidence that Congress ever intended to place in the US trade representative’s or the president’s hands a weapon that allowed hundreds of billions of dollars of trade to be subject to an additional 25 percent tariff, in the discretion of a presidential appointee, there are no limits incorporated in the statute on executive branch action. In fact, the statute prods the executive branch into acting, requiring the president’s trade representative to tell the Congress about any delay in proceeding. And in this case, there was no need to prod the US Trade Representative to impose tariffs on imports from China.
The politics and the law, respectively, make either a legislative or a court challenge to the 25 percent China tariff difficult. Two presidents of different political parties had decided that there were sufficient unfair acts to fit within the statutory grant of authority. The actions have been challenged in court and are not yet resolved. One of the complications is that China’s counterretaliation with increased tariffs of its own underlies some of the US measures.
Could Trump, as president, order without formal approval by Congress, tariffs at a 60 percent rate on imports from China? When Congress last addressed the issue of China tariffs, it was assuring lower tariffs on Chinese goods, not the reverse. In 2000, it enacted a statute that explicitly gave China the same tariff treatment as other countries receive (termed “most favored nation” treatment). To more than double the current retaliatory rate would be tantamount to ending trade with China. In this case, the Supreme Court could find that it is the prerogative of the Congress to set tariffs at rates amounting to an embargo outside of war, assuming there were no grounds for invoking laws protecting national security.
As for the other Trump tariff threat, would a 10 percent additional tariff on the products of all countries imposed by executive action be deemed constitutionally permissible, if somehow framed as being “retaliatory”? Or would the courts find that this would go beyond the Congress’s delegation of this trade authority intended for more limited circumstances?
How far the executive branch can go in determining for itself the scope of the authority that Congress grants it to regulate commerce is coming up for decision by the Supreme Court in a case recently argued before it. The case Loper Bright Enterprises v. Raimondo concerns whether fishermen must bear the costs of federal monitors on their fishing boats, as directed by a federal agency for fisheries management. The theory behind the deference that has generally been granted to the executive branch agencies is that they are far more expert in technical fields than the courts. In questions about international trade, technical expertise might be needed to measure a subsidy on an import, for example. But deciding that America would be best served by imposing a blanket tariff at a higher level on all imports is not a technical issue. The question for the Trump tariffs implied by this case is if judicial deference to administrative agencies is no longer to be as far reaching, is judicial deference to the president or his/her trade representative setting tariff rates to be maintained?
When it comes to trade, there is a way to bridge the divide between the president having the foreign affairs power and being the administrator of the laws, and the Congress having the commerce power. The Trump administration revised and modernized the North American Free Trade Agreement (NAFTA), and the Congress approved the superseding United States-Mexico-Canada trade agreement known as USMCA. In that case, the Trump administration demonstrated that it could craft a trade outcome that could attract strong bipartisan congressional support in both Houses of Congress. There was no question that the constitutional prerogatives of either the Congress or the executive were infringed.
The need to strike an appropriate constitutional balance is clear, considering Trump's threats to interfere with American’s ability to trade with other countries. An urgent imperative: Trade retaliatory and national security authorities should be revisited by the Congress and tailored to be within the bounds of what is constitutionally permissible. While individual aggressive retaliatory measures imposed piecemeal to counter specific burdens placed on US commerce abroad may be readily sustained using existing authority, the Supreme Court may not go along with the president setting a new tariff rate on the pretext that all foreign trade is unfair. Placing a new 10 percent tariff against all products from all sources might even attract a judicial stay to prevent implementation as challenges are considered by the courts.
The term “the imperial presidency” was coined by historian Arthur Schlesinger to address President Nixon and his successors appropriating war-making powers granted in the Constitution to the Congress. When it comes to international trade, the rise of the imperial presidency may have hit its high-water mark, inviting a challenge in the courts.
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