The Supreme Court is not likely to apply deference to the president in the tariffs case and is likelier to closely scrutinize what powers were delegated.
The Supreme Court is not likely to apply deference to the president in the tariffs case and is likelier to closely scrutinize what powers were delegated.
A re we overestimating how much trouble the Trump tariffs are in? After Wednesday’s oral argument in Learning Resources, Inc. v. Trump, our editorial reviewed the toughest questions asked of Solicitor General John Sauer and the case for striking down the tariffs on the grounds that Congress hasn’t clearly delegated such vast, limitless taxing powers to the president. I added my own nose-counting analysis of why this case might not even be close. Much of the consensus in the legal commentariat has taken a similarly dim view of Trump’s prospects. The president is caught between the conservative justices, who are apt to disfavor his legal arguments, and the liberal justices, who are apt to disfavor him.
But there are dissenters. Professors Josh Blackman and Jonathan Turley, focusing on the questioning of Neal Katyal (arguing for the main challengers to the tariffs), are more optimistic about Trump’s prospects. Blackman writes that “I think the government ekes this one out. The vote might be weird.” Turley says that “there is a real chance of a fractured decision that could still produce an effective win for the Administration.” Both focus on the possibility that Justice Neil Gorsuch might conclude that the relevant statute, the International Emergency Economic Powers Act of 1977 (IEEPA), does delegate the tariff authority that Trump claims, but that Gorsuch will be unable to persuade his colleagues that this delegation is unconstitutional (as he appears to believe).
Let’s consider the government’s main arguments as well as what a fractured decision might look like. I’ll start in this column by reviewing the arguments about how the Court should analyze the president’s assertions of power.
Who and How
There are two central legal questions in this case. First, did IEEPA delegate tariff power to the president that he can deploy when he declares an emergency? Second, if so, was this an unconstitutionally unbounded delegation of the powers of Congress to the executive branch?
As so often happens in big cases, before you get to the legal questions, there are two background questions: Who decides and under what standard?
On the “who decides?” front, there appears to be no obstacle to the Court deciding the case. As I’ve previously detailed, and as the briefs and the argument seem to confirm, nobody disputes that there are plaintiffs with standing to challenge the tariffs, that the legal issues are ripe for decision, or that the Court has jurisdiction over at least one of the two cases before it. I’ll circle back in a later installment to how exactly this case might get decided, but none of the justices questioned whether the case is properly before them and whether they should resolve whether or not Trump has the powers he claims.
Where the “who decides” part comes into play is that the government argues that presidential decisions in the foreign policy area are traditionally granted wide, nearly unreviewable discretion — and so are presidential uses of emergency powers. This argument has some force insofar as the Court will want to avoid, if possible, getting into whether trade deficits that have persisted for half a century are actually a national emergency (as Trump contends), whether these tariffs are a proportional response, and whether the tariff power can be used as leverage to accomplish other foreign-policy ends, such as combatting drug trafficking. Even Justice Ketanji Brown Jackson appeared to side with the administration on the last of those questions.
There are, however, two related problems for the government with making the “it’s foreign, so defer to the executive” argument. One is that it is question-begging: It assumes that the president is acting within his Article II commander in chief powers, rather than exercising an Article I legislative power of Congress (taxation) and then trying to rebrand it as a foreign emergency power. As Justice Robert Jackson famously wrote in his celebrated concurring opinion in Youngstown Sheet & Tube Co. v. Sawyer (1952), about Harry Truman trying to seize steel mills to stop a strike during the Korean War, “The Constitution did not contemplate that the title Commander in Chief of the Army and Navy will constitute him also Commander in Chief of the country, its industries and its inhabitants.”
The other problem is that the very fact of the power being broad and mostly unreviewable is all the more reason for the Court to check the president’s ticket at the door by asking whether he has that power in the first place. That’s why the justices peppered Sauer with questions about the limits and implications of his arguments.
A Matter of Classification
It is therefore crucial to this case to classify the power at issue: Is it a taxing power that must be delegated? Is it a foreign policy power, as to which courts traditionally defer to presidents? Or is it some strange hybrid of the two?
In terms of classification, the argument went poorly for Solicitor General John Sauer (in spite of his best efforts), and it requires rose-colored glasses to say otherwise. None of the justices seemed fooled by the effort to reclassify the tariffs as an Article II executive foreign policy power, which was where Sauer had started the argument, talking about “the foreign affairs context, where [the president] has his own inherent Article II authority,” to the point where Gorsuch quipped, “You’re saying there’s inherent authority in foreign affairs, all foreign affairs, so regulate commerce, duties and tariffs and war. It’s inherent authority all the way down, you say.” Sauer conceded in response that “we don’t contend that he has, at least in peacetime, inherent tariffing authority.”
That is an enormous, decisive concession. Sauer tried to sneak some Article II flavor back in, adding immediately after that:
What we have here is two layers. There’s the layer, the bedrock, of the President’s . . . inherent Article II powers, and layered on top of that is a sweeping delegation of authority from Congress. When you put those two things together, Congress has said you have inherent powers to address international emergencies, and we’re conferring on you the tools including Article I tools, like, for example, the power to regulate foreign commerce.
Sauer’s concession that the president has no inherent tariff power in peacetime put an end to any argument that the Court should just defer to the president without first determining that Congress had, in IEEPA, actually delegated a tariff power. By saying that Congress gave the president “Article I tools,” Sauer admitted that.
Moreover, the justices had no illusions that a tariff is a tax. Sauer went on:
I want to make a very important distinction here. We don’t contend that what’s being exercised here is the power to tax. It’s the power to regulate foreign commerce. These are regulatory tariffs. They are not revenue-raising tariffs. The fact that they raise revenue is only incidental.
Chief Justice John Roberts, however, rejoined, “It’s been suggested [by Trump] that the tariffs are responsible for significant reduction in our deficit. I would say that’s raising revenue domestically.” “Who pays them?” he asked. Roberts gave some defenders of the tariffs hope by commenting to Katyal:
Sure, the tariffs are a tax and that’s a core power of Congress. But they’re a foreign-facing tax, right, and that — foreign affairs is a core power of the executive. And I don’t think you can dismiss the consequences. I mean, we didn’t stay this case. And one thing is quite clear, is that the foreign-facing tariffs — tariffs have in several situations been quite effective in achieving a particular objective. So I don’t think you can just separate it. When you say, well, this is a tax, Congress’s power, it implicates very directly the President’s foreign affairs power.
Even with the usual grain of salt that Roberts doesn’t always go the same way in an opinion as he seems headed at argument, that remark has to be bracketed with what he had previously told Sauer:
It’s two-facing. Yes, of course, tariffs and dealings with foreign powers, but the vehicle is imposition of taxes on Americans, and that has always been the core power of Congress. So, to have the President’s foreign affairs power trump that — that basic power for Congress seems to me to kind of at least neutralize between the two powers, the executive power and the legislative power.
“Neutralize” is the key word there, because it suggests that Roberts doesn’t think that the executive is owed any sort of deference or thumb on the scale in interpreting IEEPA; he just wants to be sensitive to the foreign-affairs context of the legislative delegation. Roberts bristled when Sauer tried to invoke Dames & Moore v. Regan (1981), a case involving invocations of IEEPA by Jimmy Carter and Ronald Reagan during the Iranian hostage crisis. Dames & Moore, an opinion by William Rehnquist, is often cited for a broad view of executive foreign policy powers, but as Blackman notes, Roberts (who clerked for Rehnquist during the term when Dames & Moore was decided) has consistently argued for a narrow reading of that decision as being dictated by its circumstances in the negotiated end to the hostage crisis.
True, a few of the justices — most notably Justice Samuel Alito and Justice Clarence Thomas — were concerned that the president’s hands might be tied in denying him the weapon of tariffs to deal with emergencies such as an impending invasion or a hostage crisis. A few of them raised what Sauer called the “donut hole” question: Why would presidents be granted more extraordinary powers (e.g., to put a total embargo on trade) but not the lesser power of a tariff? That was how the predecessor to the Federal Circuit reasoned in the 1975 Yoshida decision: “We do not find it surprising that Congress did not specify that the President could use a surcharge in a national emergency. Having left the battlefield, it would hardly do to dictate all the weapons to be used in the fight.”
But that’s not really a question of whether to treat this case in the category of unenumerated Article II powers rather than enumerated, delegated Article I powers. In reading the list of powers granted by Congress to the president in IEEPA, it’s still the Court’s job to determine what was left in and what was left out.
All the donut-hole argument does is offer a background assumption in reading the statutory text that we should presume that Congress wanted to give presidents a lot of leeway in emergencies. Yet, it is hardly surprising that Congress sometimes gives the president some powers while withholding others, and it’s especially not surprising that it might withhold the taxing power, for four reasons. One is the unique history of taxation noted by Gorsuch: “The power to reach into the pockets of the American people is just different, and it’s been different since the Founding and the Navigation Acts that were part of the spark of the American Revolution.” The second is that the executive’s power to raise money without Congress undermines the leverage of Congress in inter-branch battles — a background that is especially obvious during a government shutdown. The third is that tariffs, precisely because they are a less dramatic power than an embargo, are more apt to be left in place for a very long time under the guise of an “emergency” that has been ongoing for half a century. And the fourth is that Congress has already given presidents quite a lot of levers in the tariff area outside of IEEPA, and it provided detailed rules of the road for how those tariff powers should be exercised.
Major Questions
Aside from deference to foreign policy powers, the other how to decide issue is the major questions doctrine. That doctrine is merely an interpretive guide to how the Court reads statutes: The bigger the power claimed by the executive, the more closely the Court should look at the statute for evidence that Congress actually meant to hand it over. The underlying assumption, especially with powers that may raise constitutional questions, is that when Congress empowers the executive branch to take over big, controversial policymaking areas, it does so explicitly; it doesn’t typically just write general language to offhandedly do so.
The government has argued that the major questions doctrine is more appropriate to deploy against executive agency action than that of the elected president, and has not been used in the foreign policy area. But the former point isn’t really a formal distinction, and the latter falls apart in the face of Sauer’s concession that this case is about delegated Article I powers. Sauer is on slightly stronger ground in noting that IEEPA is really all about major questions — i.e., national emergencies — and anticipates the exercise of broad, unanticipated presidential powers in unforeseen and unforeseeable circumstances. But again, that’s more of a background consideration than a rule of deference.
Roberts observed of the vast scope of power claimed, “It does seem like that’s major authority.” To Justice Brett Kavanaugh, it was key to consider whether Trump is claiming powers that nobody else had previously claimed or invoked:
Figuring out what “regulate importation” means is obviously central here, and for major question purposes, I think the way we think about that kind of question is, does the specific authority, power, major power now asserted pursuant to that general statutory authorization, was that the kind of power that would have been understood by people, by Congress at the time the general statute was passed, as distinct from being a novel kind of use of that general authority to do something different? “Unheralded” is the word in our cases. Okay. One problem you have is that presidents since IEEPA have not done this.
I’ll return to the point that commanded Kavanaugh’s attention — the example of Richard Nixon’s 1971 “surcharge” that was on the mind of Congress when it wrote IEEPA — but the key point here is that even if Sauer can avoid the formal application of the major questions doctrine, that doesn’t get him where he needs to go, and the major-questions heuristic will still be looming in the justices’ heads: Is there anything in the list of powers delegated in IEEPA that would suggest an unspecified power to impose tariffs unlimited in time, space, amount, or targeted goods?
That’s still a very hard case to make when you read the language of this statute. I’ll turn to that language in the next installment.