Week in Review - The Regulatory Review

The Supreme Court strikes down President Trump’s tariffs, DHS suspends Global Entry, and more…

*IN THE NEWS *

• In a 6–3 decision, the U.S. Supreme Court ruledthat President Donald J. Trump did not have the authority under theInternational Emergency Economic Powers Actto impose tariffs on imported goods,strikingdown the tariffs as unconstitutional taxes that only Congress can levy. The Court did notprovidea mechanism for businesses to get refunds for tariffs they already paid,leavingthat question for lower courts to decide. President Trumpclaimedthat “almost all countries and corporations” want to keep deals they have already made rather than face potentially worse tariffs under newSection 301investigations, which wouldcreatenew, country-specific tariffs as a way to replace the high-rate tariffs that were ruled unconstitutional. - The European Union haltedapproval of itstrade agreementwith the United States after President Trumpthreatenedto impose a 15 percent global tariff—up from the 10 percent heannounceda day earlier—following a U.S. Supreme Court decision thatruledhis sweeping tariffs illegal. The European Commissionstatedthat “a deal is a deal” andwarnedthat the EU expects the United States to honor its commitments, with no increases in tariffs beyond what was previously agreed upon. U.S. Trade Representative AmbassadorJamieson Greersaidthe Administration expects to “stand by” existing agreements. - The U.S. Department of Homeland Security suspendedGlobal Entry, which expedites airport customs processing for some international travelers, due to the department’s lapse in funding. The department reportedlyannouncedthat the Transportation Security Administration’s PreCheck program would also be suspended, before reversing that decision. ButKristi Noem, Secretary of Homeland Security, reportedlywarnedthat PreCheck could still be suspended if the ongoing partial government shutdown—which affects only the Department of Homeland Security—continues. The departmentblamedDemocratic lawmakers for the shutdown, while SenatorChuck Schumer(D-N.Y.)accusedthe department of “choosing to inflict pain on the public,” noting that the Global Entry program was unaffected throughout last year’s historically-long, full-government shutdown. - The U.S. Department of the Interior revokedprotections for over 2.1 million acres of public land in northern Alaska to allow domestic energy and mineral production. In astatement, Secretary of the InteriorDoug Burgumreferenced President Trump’sexecutive orderpromoting “American Energy Dominance.” Prospective projects for the landincludethe construction of a natural gas pipeline and an industrial road to a mining district. Alaska GovernorMike Dunleavycalledthe action “a milestone for Alaska’s self-determination.” Meanwhile, the Tanana Chiefs Conference, an organization of Native tribal governments in the region,claimedthe decision will put tribal “lands, animals, waters, and subsistence resources at real risk.” - [Sean] The U.S. Attorney for the District Columbia, Jeanine Pirro,endedthe government’s case against the six Democratic members of congress who posted avideolast year calling on military members to refuse unlawful orders. At the time, President Donald J. Trumpaccusedthe six lawmakers of “seditious behavior, punishable by death,” while Democratic lawmakersdefendedthe video as legally accurate, protected speech. Despite the low bar for indictment—experts have longremarkedthat a jury would “indict a ham sandwich”—a grand juryfailedto indict the six lawmakers, prompting Pirro to drop the case. - [Julie] The U.S. Department of Justice suedthe state of New Jersey and its GovernorMikie Sherrillover anexecutive orderbanningU.S. Immigration and Customs Enforcement(ICE) agents from entering nonpublic areas of state property without a warrant. The order alsobarredICE agents from using state property as a “staging area, processing location, or operations base.” The Justice Departmentarguedthat the order violated theSupremacy Clauseof the U.S. Constitution. The lawsuit arrives several weeks after the Trump Administrationendedits surge of ICE agents deployed in Minnesota. - [Julie] The U.S. Securities and Exchange Commission (SEC) announcedupdates to its internalenforcement protocolsthat will give people subject to investigations more time to respond to notices of potential charges against them. Now, after a suspectfilesa response to the SEC’s allegations, the suspect will be entitled to a meeting with a senior SEC member within four weeks. Before the changes, the SEC oftenallowedsuspects two weeks to respond to its charges but granted extensions. - [Sean] The Trump Administration’s nominee for Surgeon General, Casey Means,facedquestions about her stance on the efficacy of vaccines in a U.S. Senate Health, Education, Labor, and Pensions Committee confirmation hearing. Some health experts havecriticizedwhat they perceive as unfounded opposition to vaccines by the U.S. Department of Health and Human Services. Earlier this month, the U.S. Food and Drug Administration initiallyrefusedto consider an application for an mRNA-based flu vaccine, surprising experts, before accepting the application last week. In her confirmation hearing, Means reportedlyacknowledgedthe efficacy of vaccines but declined to endorse flu and measles vaccines for children.

WHAT WE’RE READING THIS WEEK

• In a recent report, theU.S. Government Accountability Office(GAO) examined the coordination in public health emergency preparedness between theCenters for Disease Control and Prevention(CDC) and theAdministration for Strategic Preparedness and Response(ASPR). These agencies, which run thePublic Health Emergency Preparedness(PHEP) Program andHospital Preparedness Program(HPP),lacka formal mechanism to unite the programs. GAOobservedthat, while HHSawardedalmost $900 million in fiscal year 2024 to help jurisdictions prepare for public health threats, CDC and ASPR do not collect or analyze information on jurisdictions’ ability tomeetthe 15 public health and four health care preparedness capabilities or identify related gaps. GAOrecommendedthat HHS establish a mechanism to coordinate PHEP and HPP,provideinformation on how required activities support preparedness capabilities, andanalyzeinformation on jurisdictions’ capabilities and gaps. - A recent reportby theU.S. Government Accountability Office(GAO) examinedConsumer Product Safety Commission(CPSC) oversight of toxic substances in children’s products. GAOfoundthat CPSC uses risk-based approaches to assess children’s products at U.S. ports, including screening for lead and other toxic substances, but has not developed an oversight plan to ensure that a new e-filing system will achieve accurate, timely data submissions. GAOobservedthat while CPSC has processes to verify that labs meet its accreditation requirements, it has not proactively analyzed violation data across lab types to identify potential risks such as inaccurate testing or misreported results. GAO alsofoundthat CPSC has not reviewed its lead requirements as mandated by federal law and lacks written procedures for monitoring changes related to other toxic substances in children’s products. GAOrecommendedthat CPSC establish oversight plans for e-filing compliance and lab risk assessment and document processes for keeping its lead and toxic substance standards up-to-date. - In a recent article,Theodosia Stavroulaki, a law professor atSt. Louis University, argued that hospital mergers are exacerbating infant and maternal mortality rates in the United States. Rural hospitals often merge with competitors to avoid closure, but many of these hospitals stop providing obstetric care after being absorbed, Stavroulakiexplained. These discontinuationsforcewomen to travel further for obstetric care and cause some women to forgo care entirely—particularly women who cannot afford transportation, childcare, or time off from work. Stavroulakiproposedthat the Federal Trade Commission use its antitrust enforcement powers to either block mergers that would reduce access to care or negotiate settlements under which merging hospitals commit to keeping obstetric care units open.

EDITOR’S CHOICE

• In an essayfor,The Regulatory ReviewRichard J. Pierce, professor atThe George Washington University Law School, argued that environmental groups that block the construction of natural gas pipelines and electricity transmission lines are creating significant obstacles to mitigating climate change. Pierceexplainedthat electric generating plants accounted for 38 percent of carbon dioxide emissions and the only practical way to cut emissions is through “fuel switching”—substituting natural gas for coal—which reduces carbon content by about half. Piercearguedthat maintaining these gainsrequiresbuilding new pipelines to transport natural gas to power plants and new transmission lines toconnectwind and solar facilities to population centers where electricity is consumed. Pierceconcludedthat environmental advocacy groups should carefully consider whether the local environmental effects of any proposed pipeline or transmission line truly exceed its climate benefits, suggesting such situations will be rare.