What happens to Trump’s tariffs now that a court has knocked them down?

WASHINGTON AP A federal court in New York handed President Donald Trump a big setback Wednesday blocking his audacious plan to impose massive taxes on imports from almost every country in the world A three-judge panel of the U S Court of International Bargain ruled that Trump overstepped his authority when he invoked the International Crisis Economic Powers Act to declare a national exigency and justify the sweeping tariffs The tariffs overturned decades of U S agreement approach disrupted global commerce rattled financial markets and raised the danger of higher prices and recession in the United States and around the world The U S Court of International Transaction has jurisdiction over civil cases involving pact Its decisions can be appealed to the U S Court of Appeals for the Federal Circuit in Washington and ultimately to the Supreme Court where the legal challenges to Trump tariffs are widely expected to end up Which tariffs did the court block The court s decision blocks the tariffs Trump slapped last month on almost all U S trading partners and levies he imposed before that on China Mexico and Canada On April Trump imposed so-called reciprocal tariffs of up to on countries with which the United States runs a deal deficit and baseline tariffs on almost everybody else He later suspended the reciprocal tariffs for days to give countries time to agree to reduce obstacles to U S exports But he kept the baseline tariffs in place Claiming extraordinary power to act without congressional approval he justified the taxes under IEEPA by declaring the United States longstanding transaction deficits a national emergency In February he d invoked the law to impose tariffs on Canada Mexico and China saying that the illegal flow of immigrants and drugs across the U S boundary amounted to a national emergency and that the three countries needed to do more to stop it The U S Constitution gives Congress the power to set taxes including tariffs But lawmakers have gradually let presidents assume more power over tariffs and Trump has made the greater part of it The tariffs are being challenged in at least seven lawsuits In the ruling Wednesday the commerce court combined two of the cases one brought by five small businesses and another by U S states The ruling does leave in place other Trump tariffs including those on foreign steel aluminum and autos But those levies were invoked under a different law that required a Commerce Department inquiry and could not be imposed at the president s own discretion Why did the court rule against the president The administration had argued that courts had approved then-President Richard Nixon s exigency use of tariffs in a economic and financial situation that arose when the United States suddenly devalued the dollar by ending a procedures that linked the U S currency to the price of gold The Nixon administration successfully cited its authority under the Trading With Enemy Act which preceded and supplied various of the legal language later used in IEPPA The court disagreed deciding that Trump s sweeping tariffs exceeded his authority to regulate imports under IEEPA It also reported the tariffs did nothing to deal with problems they were supposed to address In their development the states noted that America s arrangement deficits hardly amount of a sudden crisis The United States has racked them up for straight years in good times and bad So where does this leave Trump s agreement agenda Wendy Cutler a former U S deal official who is now vice president at the Asia Society Strategy Institute says the court s decision throws the president s contract framework into turmoil Partners negotiating hard during the -day day tariff pause period may be tempted to hold off making further concessions to the U S until there is more legal clarity she stated Likewise companies will have to reassess the way they run their supply chains perhaps speeding up shipments to the United States to offset the peril that the tariffs will be reinstated on appeal The transaction court noted that Trump retains more limited power to impose tariffs to address bargain deficits under another statute the Transaction Act of But that law restricts tariffs to and only for days with countries with which the United States runs big bargain deficits For now the agreement court s ruling destroys the Trump administration s rationale for using federal exigency powers to impose tariffs which oversteps congressional authority and contravenes any notion of due process declared Eswar Prasad professor of transaction framework at Cornell University The ruling makes it clear that the broad tariffs imposed unilaterally by Trump represent an overreach of executive power AP Writer Lindsay Whitehurst contributed to this story Source