Administration Failures

Trump's Tantrum Tariffs - emptywheel

After the Supreme Court rulings that declared Trump's tariffs illegal, Trump quickly reimposed new tariffs under a different authority, contrary to legal advice and expert analysis. This retaliatory move, seen as a tantrum and politically motivated, is unlikely to benefit the US economy and may harm small businesses, especially with the tariffs now increased to 15%. The decision highlights ongoing conflicts over executive power and the economic impacts of tariffs.

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Trump's Tantrum Tariffs - emptywheel

Within hours of SCOTUS’ decision ruling Trump’s tariffs illegal, Trump imposed new 10% tariffs under a different authority, ranting at Neil Gorsuch and Amy Coney Barrett for betraying him all the while, and promising to take in more money than before.

I think I’ve got a pretty good record on the import of Trump’s stupid tariff decisions and how they would play out:

And I think Trump may really live to regret this quick imposition of new tariffs. It’s a colossally stupid policy, for the US, for the rest of the world, but even for Trump. Trump could have taken the rebuke from SCOTUS as an opportunity to reverse a policy that is not having what Trump claims is the desired effect, to shrink the US trade deficit in goods.

Trump tried his tariffs, did potentially irreversible damage to key sectors of the US economy, but they didn’t do anything more than give him a hammer to use to inflict arbitrary damage on the economy, like a child banging his toys. He could have dropped them.

Instead, Trump just unilaterally imposed taxes on Americans, taxes that will be visible as such, will be visible as such during election season. And he did so primarily as a tantrum against judges ordering him to follow the law.

The decision arises out of three different kinds of coddling that Trump’s advisors have been engaged in.

The first comes from his financial advisors. Some of them believe in tariffs. Some don’t. All indulge the President’s economically-illiterate fetish for tariffs, even when several of them have fact checked his bullshit claims about them. Before yesterday’s ruling, there were reports that Trump was going to reverse steel and aluminum tariffs, in part because they were making soda cans expensive for consumers; instead, Trump has doubled down. The need to tell Trump what he wants to hear about tariffs prevents his advisors from providing him rigorous advice about how they’re screwing over the United States.

This coddling goes so far that even at a time when Trump is in trouble for pressuring the Fed, even after å series of other economists concluded the same thing, Kevin Hassett recently argued some NY Fed economists should be disciplined for concluding that Americans pay almost all the tariff collected.

I think, the worst paper I’ve ever seen in the history of the Federal Reserve system. The people associated with this paper should presumably be disciplined, because what they’ve done is they’ve put out a conclusion which has created a lot of news that’s highly partisan based on analysis that wouldn’t be accepted in a first-semester econ class.

Hassett doesn’t want anyone to speak the truth about these taxes, because he wants to shelter the stupid policies he and the rest of Trump’s team have allowed him to sustain. And now they leapt forward with ways to sustain them even in the face of an adverse legal ruling.

With the exception of some earlier immigration reversals from SCOTUS, Trump hasn’t suffered such an adverse legal ruling since 2020, when one after another judge told Trump he was a loser. Since John Sauer was confirmed as Solicitor General in April, though, he has largely gamed the appellate process to prevent such losses. He attempted to do so here, too, in part by floating Trump’s bullshit claims in such a way as to shield them from legal consequences.

But everyone knew he was going to lose this one. Gorsuch, the target of Trump’s ire, telegraphed this pretty clearly during oral arguments in November.

JUSTICE GORSUCH: And if that’s true, what would — what would prohibit Congress from just abdicating all responsibility to regulate foreign commerce, for that matter, declare war, to the President?

GENERAL SAUER: We don’t contend that he could do that. If it did —

JUSTICE GORSUCH: Why not?

GENERAL SAUER: Well, because we’re dealing with a statute, again, that has a whole list of limitations.

JUSTICE GORSUCH: I’m not asking about the statute. General, I’m not asking about the statute. I’m asking for your theory of the Constitution and why the major questions and nondelegation, what bite it would have in that case.

GENERAL SAUER: Yes. I would say, by then, you would move from the area where there’s enormous deference to the President in actually both the political branches, where, here, there’s inherent authority, and pile on top of that there’s a broad delegation of the duty and —

JUSTICE GORSUCH: You’re saying there’s inherent authority in foreign affairs, all foreign affairs, so regulate commerce, duties and — and — and — and tariffs and war. It’s inherent authority all the way down, you say. Fine. Congress decides tomorrow, well, we’re tired of this legislating business. We’re just going to hand it all off to the President. What would stop Congress from doing that?

GENERAL SAUER: That would be different than a situation where there are metes and bounds, so to speak. It would be a wholesale abdicat

[snip]

JUSTICE GORSUCH: Can you give me a reason to accept it, though? That’s what I’m struggling and waiting for. What’s the reason to accept the notion that Congress can hand off the power to declare war to the President?

GENERAL SAUER: Well, we don’t contend that. Again, that would be —

JUSTICE GORSUCH: Well, you do. You say it’s unreviewable, that there’s no manageable standard, nothing to be done. And now you’re — I think you — tell me if I’m wrong. You’ve backed off that position.

GENERAL SAUER: Maybe that’s fair to say.

JUSTICE GORSUCH: Okay. All right. Thank you.

So Sauer and others should have prepared Trump for this loss; there are signs in his Truth Social feed they did. But they’re squealing to discredit this decision instead.

Perhaps most importantly, Stephen Miller — who went on an ever-loving rant on Laura Ingraham’s show yesterday, lying at scale to rebut JB Pritzker’s genius demand to get paid back (which I’ll return to in a follow-up) and to attack the Justices who voted against him — wants to discredit all faith in rule of law.

Nothing Miller said is true; indeed, it ignores this footnote from John Roberts.

4The principal dissent surmises that the President could impose “most if not all” of the tariffs at issue under statutes other than IEEPA. Post, at 62 (opinion of KAVANAUGH, J.). The cited statutes contain various combinations of procedural prerequisites, required agency determinations, and limits on the duration, amount, and scope of the tariffs they authorize. See supra, at 8–9; post, at 62–63. We do not speculate on hypothetical cases not before us.

This may not be coddling; it may instead be exploitation. But these tariffs matter to Trump (as Paul Krugman wrote here) because he used them to exercise arbitrary power.

Miller needs Trump to act without humility, he needs to discredit any law that binds his own power as exercised through Trump. And so he, like Trump, pushed more tariffs along with the lies both told to justify them.

So with no pause, the tariffs are back. As Justin Wolfers assessed, These tariffs, which will expire around July 23, accomplish nothing but tax consumption. They exercise no leverage, no coercion, no resilience. They’re simply a tax. But since consumers will pay for them, they end up punishing consumers — and the small businesses who might be saved by relief in response to SCOTUS’ ruling — because Trump had to follow the law.

Over the next five months, these taxes could force small businesses, already under pressure from the last year of tariffs, into bankruptcy.

At a time when voters are complaining about affordability, Trump just imposed a tax on them that will be far more visible than the earlier ones.

As I said, I’ll return to Pritzker’s genius step of invoicing Trump; it should be the first of many ways to impose a political cost for Trump’s past and future tariff policy.

And this will unfold as the GOP, most of whom already hate the tariffs, will have to answer for them at the polls.

Update: Trump has now boosted his tantrum tariffs to 15%.

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