Tariff Policy by the Numbers
Understanding what just happened and what can come next
Will Section 122 give Donald Trump enough time to invoke Sections 232 and 301? If not, is Section 338 really a possibility? Do you have any idea what I’m talking about? I hope not.
On Friday the Supreme Court delivered a body blow to Trump’s tariff policies, ruling that his promiscuous use of the International Emergency Economic Powers Act — the acronym IEEPA sounds like a yelp of pain, which is appropriate — is illegal. In principle Trump could reclaim authority to do whatever he wants on international trade by getting Congress to pass enabling legislation, which is how the federal government normally works. But his tariff policy is wildly unpopular, the most unpopular ever, unpopular like nobody has ever seen before:
Members of Congress know this, and while Republicans will do almost anything for Trump, they won’t do that — that is, they wouldn’t have voted in the Trump tariffs as they were until Friday, and they won’t vote to restore them now. The Supreme Court struck down those tariffs because Trump tried to use IEEPA to impose tariffs without Congressional approval, and the Court said that was illegal.
But how was it ever possible to impose tariffs without a Congressional vote? Tariffs are taxes, and imposing taxes normally requires legislation. Why, then, has Trump been able to impose large tariffs without even consulting Congress? Why might he be able to keep tariffs high despite the Court’s ruling? And what’s with all the section numbers?
To understand what’s happening on tariffs, one needs to understand the history of U.S. international trade policy. And I do mean history: America has a system for tariff-setting whose roots go all the way back to the 1930s. That system was hammered together over decades by some very smart people who ingeniously harnessed self-interest in pursuit of their perception of the public good, cleverly created a synergy between domestic legislation and international diplomacy, and combined all of this with a keen sense of political realism. Unfortunately, that system was not designed to deal with a president like Trump.
Beyond the paywall I will address the following:
1. The long march to relatively free trade
2. The rules of the game, 1934-2025
3. Why presidents have so much discretion on tariffs
4. The Trump shock
