The Trump administration has launched an appeal to the Supreme Court to overturn decisions by two lower courts, which ruled that the president had exceeded his powers in imposing so-called “reciprocal tariffs” under the International Economic Emergency Powers Act of 1977, ranging from 10 to 50 percent on almost every country in the world.
At the end of May, the International Court of Trade ruled that a national emergency claimed by Trump to have been created by trade deficits did not exist and the IEEPA powers did not extend to tariffs.
In a 7–4 vote a federal appeals court upheld this decision last month, saying that neither the word “tariff” nor any of its synonyms such as “taxes” or “duties” appeared in the IEEPA legislation.
On Wednesday, Solicitor General John Sauer asked the Supreme Court to decide by September 10 to hear the case, schedule oral arguments by the first week of November and to expedite its final ruling “to the maximum extent feasible.”
If the Supreme Court takes on the case, as it almost certainly will, its decision will have far-reaching significance for Trump’s tariff war against the world. More than that, it will have implications for his drive to establish a personalist dictatorship based on the repeated claim that his exercise of executive power must be unfettered by “unelected” bureaucrats and “radical, leftist” courts.
“The stakes in this case could not be higher,” Sauer wrote. “The president and his cabinet officials have determined that the tariffs are promoting peace and unprecedented prosperity, and that the denial of tariff authority would expose our nation to trade retaliation without effective defenses and thrust America back to the brink of economic catastrophe.”
As Trump pursues his goals—economic war against the world and dictatorship at home—reality is stood on its head.
Far from promoting peace, the elevation of tariffs is, as the history of the 1930s demonstrates, a major factor in the promotion of geopolitical conflict and war. And far from promoting prosperity, Trump’s measures threaten to bring a significant reduction in world trade and a cut in global growth.
In the US they are fuelling inflation—the effects of which are starting to show up in the recent spike in the producer price index—and are in essence a tax paid by US importers and ultimately by consumers. And their cost to major corporations—General Motors and Nike have already reported a hit of $1 billion to their bottom line—will result in cost-cutting measures to maintain profits, leading to sackings, lower wages and the worsening of conditions.
Their only “beneficial” effect will be to increase government revenue to pay for the massive handouts in the form of tax cuts to corporations and the ultra-wealthy in the “big, beautiful budget.”
The argument that striking down the reciprocal tariffs would expose the US to retaliation was perhaps the most absurd of all. The US only faces retaliation from major powers, China and others, friend and foe alike, because of the tariffs it has imposed that have completely overturned the post-war international trading system.
The submission by the Justice Department warned that the decision by the appeals court weakened the global position of the US.
It had “disrupted highly impactful, sensitive, ongoing diplomatic trade negotiations, and cast a pall of legal uncertainty over the president’s efforts to protect our country by preventing an unprecedented economic and foreign-policy crisis.”
The legal submissions by Sauer and the Justice Department to the Supreme Court were based on the rantings by Trump on social media and in comments to reporters that the tariffs would bring hundreds of billions of dollars into the US which would now be jeopardised.
In a social media post last weekend in response to the appeals court decision, Trump wrote: “If a Radical Left Court is allowed to terminate these Tariffs, almost all of this investment, and much more, will be immediately cancelled! In many ways, we would become Third World Nation, with no hope of GREATNESS again.”
This was the theme of his comments to reporters at the White House on the decision to take the issue to the Supreme Court.
“If we don’t win that case, our country is going to suffer so greatly,” he said, as the US would “have to unwind” the preliminary deals it had made with the EU, Japan and South Korea. Those “deals,” imposed under the threat of major tariff hikes, contained vague agreements of an investment flow into the US amounting to hundreds of billions of dollars.
“I can’t imagine it happening,” Trump said. “On a legal basis, they have no legal basis, whatsoever, but on a commonsense basis, it would destroy America.”
Every time a court decision has gone against him, Trump has railed against the judges as “radicals” and even “Marxists.” In this case, Republican and Democratic appointees were on both sides of the appeals court decision and the dissent judgement, supported by three others, was authored by Richard Taranto, an Obama nominee.
“We know of no persuasive basis for thinking that Congress wanted to deny the president use of the tariffing tool, a common regulatory tool, to address the threats covered by IEEPA,” he wrote.
The White House senior adviser on trade and manufacturing, Peter Navarro, said the dissent “presents a very clear road map to how the Supreme Court can rule in our favour.”
It would be a mistake to simply dismiss Trump’s warnings about “devastation for our country” and its transformation into a “third world nation” if the tariffs were removed simply as mad ravings.
In their own deranged way, they are an expression of the growing economic crisis of the capitalist system as a whole—a rot which, like a fish, starts at the head. It is significant that the head of its most powerful imperialist nation insists that its very survival depends on the Mafia-like extraction of wealth and money from the rest of the world.
It remains to be seen how the administration will argue before the Supreme Court for the unfettered executive power of the presidency on tariffs. But some indication has been provided in the case of Lisa Cook, the Fed governor sacked last month in Trump’s bid to take control of the Fed and have it lower interest rates by as much as 3 percentage points.
In an interview with USA Today, Vice President JD Vance set out very clearly the thinking in the White House on this issue. It was “a little preposterous,” he said, that the president “does not have the ability to make these determinations” and that “seven economists and lawyers should be able to make an incredibly critical decision for the American people with no democratic input.”
The Fed, like all the other institutions of the capitalist state, is by its very nature anti-democratic. It has been established to guard and advance the interests of the capitalist ruling class and the financial oligarchy. The organisation of economic and monetary policy will only become democratic when the “commanding heights” of the economy, finance and the major corporations are in public ownership and democratically controlled.
Seeking to exploit the hostility of broad masses to the operations of the Fed, Vance presented the drive of the administration to seize control in terms of “democracy.”
But that is only the outer form. The inner content is dictatorship—that power should be solely in the hands of the president, unfettered by courts and other institutions, that he alone is the interpreter of the “will of the people,” and that this power should extend to all areas of the economy, from monetary policy to tariffs.