Government challenges court ruling, seeking to bypass tariff block set by Trump's decision - Tariffs blockage for Trump: American court impedes implementation - government files an appeal
Update on Trump Tariffs: US Court Ruling and Government Appeal
Economist Paul Krugman, a Nobel laureate in Economics, hailed a recent court ruling as a "long-awaited jolt of sanity" regarding the Trump administration's tariff policy. US stocks responded positively, with the Nasdaq rising by up to 1.3 percent and the S&P 500 gaining 0.7 percent, influenced by other favorable economic data.
However, Michael Hüther, director of the Institute of the German Economy, expressed cautious optimism, stating that lingering uncertainty persists. He anticipates President Trump to explore new avenues for imposing tariffs.
The US trade court's unanimous ruling invalidated most tariffs implemented by the Trump administration since his inauguration, overturning a key component of his tariff strategy. This decision affects tariffs imposed on various countries, including the EU, China, Mexico, and Canada. Some industry-specific tariffs, such as those on cars, aluminum, and steel, remain in place pending justification under the emergency law invoked by the administration.
While the White House has announced its intention to appeal the ruling, Trump counsel Stephen Miller described the decision as a "judicial power grab" that has spiraled out of control. Smaller US companies importing goods like wine, bicycles, and electronic components, as well as twelve US states challenging Trump's constitutional interpretation, have filed lawsuits.
Since declaring April 2 as "Liberation Day" and imposing high additional tariffs on multiple nations, Trump has threatened the European Union with tariffs of 50 percent starting June 1. After a phone conversation with EU Commission President Ursula von der Leyen, he has extended the deadline for these tariffs until July 9. Von der Leyen welcomed the extension but maintained her warning of retaliatory tariffs if negotiations fail.
As the appeals process unfolds, the administration and its supporters anticipate the Supreme Court's intervention to clarify and potentially uphold the Trump-era tariffs in part or whole. This ongoing legal battle carries significant implications for US trade policy and global commerce.
Additional Relevant Background
The US Court of International Trade's panel, formed with appointees from Republican and Democratic presidents, ruled that the Trump administration misused the International Emergency Economic Powers Act (IEEPA) to defend the tariffs. The IEEPA grants power only in situations of "unusual and extraordinary threats" to national security, foreign policy, or the economy. The federal appeals court has temporarily stayed the lower court's ruling against the use of IEEPA for a 10 percent baseline tariff and reciprocal tariffs, delaying the nullification of key tariffs.
- Economists, like Nobel laureate Paul Krugman, view the court's ruling on Trump tariffs as a step towards restoring economic sanity.
- Despite the court's decision, concerns remain as President Trump is said to be considering new methods to impose tariffs on various countries.
- The ruling invalidated most tariffs imposed by the Trump administration since his inauguration, but industry-specific tariffs, such as those on cars, aluminum, and steel, remain while awaiting justification under emergency law.
- Smaller US companies importing goods and twelve US states have filed lawsuits against the constitutional interpretation of the tariffs by the Trump administration.
- Trump's tariff threats to the European Union have been extended until July 9, following a phone conversation with EU Commission President Ursula von der Leyen.
- The ongoing legal battle surrounding Trump tariffs holds substantial implications for US trade policy and global commerce, with potential intervention from the Supreme Court to clarify the validity of the tariffs.
