A Skeptical SCOTUS May End Up Pondering Are Tariffs Foreign Policy Like Obamacare Was a Tax – RedState
President Trump’s power grab to impose and negotiate tariffs was met with debate at the Supreme Court on Wednesday. Although Solicitor General D. John Sauer did a phenomenal job defending the administration, it was clear that he was definitely going against the tide.
BACKGROUND
This case stems from the Trump administration’s use of tariffs as a combined foreign and economic policy tool. Building on a law called the International Emergency Economic Powers Act. This 1977 law allows the president to invoke it “to address any unusual and extraordinary threat, which originates in whole or in substantial part outside the United States, to the national security, foreign policy, or economy of the United States.” Specifically, section 1702 of the Act authorizes the President to “regulate…the import or export” of “property in which a foreign country or national thereof has an interest” in the event of a national emergency declared under the Act.
Using the IEEPA as a cornerstone, Trump issued a series of executive orders, beginning in February, imposing two sets of tariffs. One round, generally called “trafficking” tariffs, targeted products from China, Canada and Mexico that Trump said did not do enough to stop the flow of fentanyl into the United States. A second round, known as “reciprocal” tariffs, targeted other countries’ unfair trade practices. Trump called large trade deficits “an unusual and extraordinary threat to the national security and economy of the United States.”
The tariffs were challenged by two different groups of small businesses, alleging serious economic harm from the tariffs. They filed suit in the U.S. District Court for the District of Columbia and the U.S. Court of International Trade. A group of 12 states, led by Oregon, also filed a lawsuit in the Court of International Trade. The states’ lawsuit joined one filed by small businesses. In litigation in a lower court, the administration failed to win a single tariff case.
BACKGROUND:
Federal Trade Court strikes down Trump’s ‘Liberation Day’ tariffs, citing overreach – RedState
New: Another judge rules against Trump’s tariffs – RedState
Not so fast: Federal Circuit suspends Trade Court ruling on Trump tariffs – RedState
In September, the Supreme Court agreed to consolidate the cases and quickly process them into one case.
The biggest problem for the administration was the “major issues doctrine.” This means that if an agency’s interpretation of a law answers a major question, it is presumed invalid unless Congress has given it clear authorization to act. This doctrine limits the power of regulatory agencies, preventing them from developing comprehensive and transformative policies without specific instructions from lawmakers. So the same doctrine that killed Biden’s Clean Power Plan, the CDC’s COVID eviction moratorium, and OSHA’s COVID vaccination and testing mandates could spell the death knell for Trump’s tariffs.
Some highlights
A hypothesis from Justice Neil Gorsuch highlighted the court’s concerns:
Gorsuch echoed Roberts’ concerns about applying the “major issues” doctrine, asking Sauer whether a president could “impose a 50 percent tariff on gasoline-powered cars and auto parts to address the unusual and extraordinary threat of climate change from abroad.”
Sauer said the Trump administration would “obviously” say climate change is a “hoax,” but that another president would be able to do so.
I think we would all agree that this type of administrative power takes us right back to beach closures during COVID without anything approaching legislative action.
Sauer made an interesting argument regarding the issue of “major questions.” Since the law clearly grants the president the right to regulate import or export, it is assumed that he has the necessary tools to do so. According to him, the tariffs imposed by the Trump administration are not “taxes” per se; they are foreign policy tools used to change the behavior of other nations.
SG Sauer explains why tariffs are not subject to the major issues doctrine: The purpose of the IEEPA is to confer major powers. One of the main powers to regulate imports is to impose customs duties. How to regulate imports without imposing customs duties? Polk, Lincoln, McKinley asserted their power to…
–Benjamin Weingarten (@bhweingarten) November 5, 2025
The administration got help from Justice Alito.
Justice Alito: Assume an imminent threat of war with a powerful enemy whose economy depends heavily on American trade. Could a president, under this provision, impose a tariff to avoid war?
Katyal: I couldn’t establish tariffs, but I could establish quotas and an embargo. This is a rate that is…
–Benjamin Weingarten (@bhweingarten) November 5, 2025
They also received help from Judge Kavanaugh.
Justice Kavanaugh: You acknowledge that the power to suspend all commerce with the country is written into the law. If the president says we need to do something more calibrated, when it comes to tariffs, you’re saying you can’t do that. A tool is more extreme than allowed. This seems a bit unusual. Consider tariffs on India to help…
–Benjamin Weingarten (@bhweingarten) November 5, 2025
Even highly skeptical Judge Amy Coney Barrett hasn’t made it any easier for people challenging Trump’s tariffs.
But Barrett was also sometimes skeptical of challengers’ arguments. Along with Justice Brett Kavanaugh, she pressed Benjamin Gutman, the solicitor general of Oregon, who represented the group of 12 states, on whether IEEPA could, on the one hand, give the president very broad powers — for example, allowing him to suspend all trade with another country — but on the other, would not allow him to take the much smaller step, in her view, of imposing tariffs. Such a paradox, Kavanaugh suggested, created a “strange donut hole” within IEEPA.
Gutman later responded that IEEPA gave the president “a more calibrated range of tools” than simply imposing a “complete embargo.” Additionally, he added, other trade laws could allow the president to impose tariffs in such a situation.
While the left presents its arguments as a shot in the arm for President Trump, the outcome has been much more nuanced. The six conservatives obviously feared that any comprehensive decision would result in a perverse situation in which the president would have the legal authority to do something, but would be deprived of all but the most extreme tools to accomplish his mission. I would say the War Powers Act is a great example of how this plays out.
The biggest problem will be getting at least two of the Roberts, Barrett and Gorsuch troika over this particular hurdle.
At one point, Justice Neil Gorsuch, illuminating his own thinking, said: “The really key piece of context here…is [that] the constitutional grant of taxing power to Congress, the power to dip into the pockets of the American people, is simply different and it has been different since the Founding.”
Prognosis
To be clear, even the judges most favorably disposed toward Trump had serious reservations. The judges even asked how the fares paid so far could be refunded if they were found to be illegal. They worried about how Congress would reclaim from the president his right to regulate commerce once he obtained it. They were troubled by the prospect of a president using tariffs to create his own revenue stream outside of Congressional appropriations. But, by the same token, questions as important as these are often decided on political as well as legal grounds.
The justices should be keenly aware that Trump’s effectiveness as president depends on this decision. A decision declaring the tariffs illegal would be a huge humiliation for Trump, both domestically and internationally, and Trump doesn’t handle humiliation very well. They should also be aware that Trump has done them good so far by accepting stupidly partisan district court decisions instead of asking them to go to FOAD.
We’ve seen something like this before. When Obamacare was challenged on the grounds that it was an unconstitutional penalty for refusing health insurance, everyone knew that was the case; however, everyone also knew that this was Obama’s signature law and that there would be a political price to pay for its repeal. Justice John Roberts threaded the needle when he said it was not a penalty but a tax, and therefore a function of the primary power of Congress; see National Federation of Independent Businesses c. Sebelius. The key to this case is persuading five justices to conclude that tariffs are, in fact, a means of conducting foreign policy, rather than a tariff in the economic sense of the term. I think, now keep in mind that I’m not a lawyer, that we will see a piecemeal decision that will allow Trump to use tariffs instead of carrots and sticks in negotiations, but at the same time prevent them from being used to reorganize domestic politics, as with the embargo on gasoline cars and auto parts hypothetically in the Roberts question. We should know by Christmas.
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