Tag: global trade

In response to the United States Supreme Court’s decision that found America’s sweeping global tariffs unconstitutional, US President Donald Trump announced he will impose a 10% global tariff, according to a news report by Kyodo News.

To put things in perspective, posted below is an excerpt from the Kyodo News report. Some parts in boldface…

U.S. President Donald Trump said Friday that he will impose a new 10 percent “global tariff” after the Supreme Court struck down his duties targeting nearly all of America’s trading partners, delivering a major blow to his signature economic policy and likely complicating Washington’s relations with the rest of the world.

Upholding lower court findings, the highest court ruled that Trump overstepped his presidential powers when he used a 1970s-era emergency law last year to impose the so-called reciprocal tariffs, as well as fentanyl-related levies he applied to goods from China, Canada and Mexico.

Calling the ruling “deeply disappointing,” Trump said, “I’m ashamed of certain members of the court, absolutely ashamed for not having the courage to do what’s right for our country.“

At a press conference, Trump unleashed a barrage of criticism against the justices, accusing them of being “very unpatriotic and disloyal to our Constitution,” and claimed that the court has been influenced by “foreign interests.”

At the center of the case was Trump’s invocation of the 1977 International Emergency Economic Powers Act to swiftly bring the tariffs into effect without congressional approval, even though taxation is an enumerated power of the legislative branch.

During oral arguments in early November, a majority of the court’s nine justices, six of whom were appointed by Republican presidents, already appeared skeptical of Trump’s authority to bypass Congress in levying the double-digit tariffs.

Writing for the final 6-3 judgment, Chief Justice John Roberts, a conservative appointed by President George W. Bush, said Trump could not legally justify his extraordinary action.

“The president asserts the extraordinary power to unilaterally impose tariffs of unlimited amount, duration, and scope. In light of the breadth, history, and constitutional context of that asserted authority, he must identify clear congressional authorization to exercise it,” Roberts said.

Tariffs are the centerpiece of Trump’s “America First” agenda. The Republican president has argued they will revitalize U.S. manufacturing, create jobs, reduce the country’s debt, raise tax revenue and equip the United States with more negotiating leverage to extract concessions from other countries.

In the early months of last year, the Trump administration introduced the tariffs on goods from China, Canada and Mexico, accusing the top three U.S. trading partners of not doing enough to stem the flood of deadly fentanyl coming into the United States.

In April, Trump announced “Liberation Day” tariffs, which consist of a 10 percent universal tariff, plus varying additional duties on dozens of countries with which the United States runs significant trade deficits.

The emergency law, known as IEEPA, stipulates that it can be exercised “to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States, to the national security, foreign policy, or economy.”

No president had previously used the law to impose tariffs, with countless U.S. and foreign companies suing the Trump administration to challenge the legality of the IEEPA-based measures and to ensure they receive refunds should the Supreme Court invalidate them.

The Supreme Court did not say whether the U.S. government must refund revenue from the tariffs.

At the press conference, Trump suggested that he would not refund the hundreds of billions of dollars, and the issue would end up in a long court battle.

Trump said foreign countries must be “so happy, and they’re dancing in the streets, but they won’t be dancing for long — that I can assure you.”

He stressed that his administration has “very powerful alternatives” to replace the tariffs the court “incorrectly rejected.”

While voicing willingness to advance his trade agenda by other means, Trump said he will introduce a new 10 percent tariff on imports from all countries, on top of the existing duties.

He said the additional tariff will be backed by Section 122 of the Trade Act of 1974, which permits him to levy such a measure for up to 150 days if there are serious trade deficits that need to be addressed.

Under the country-specific tariff framework, Trump initially threatened to impose a 25 percent levy on Japan, but the figure was lowered to 15 percent after months of negotiations, in return for Tokyo committing to massive investments in the United States in the coming years.

As Japan also promised to buy more American products, a trade agreement struck by the two countries resulted in Japanese automobiles being subject to a 15 percent tariff, down from the hefty 27.5 percent rate that took effect in April.

Let me end this piece by asking you readers: What is your reaction to this development? Are you surprised with the US Supreme Court’s decision? What do you think will happen to the economy of the United States as a result of the US Supreme Court’s decision?

You may answer in the comments below. If you prefer to answer privately, you may do so by sending me a direct message online.

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