Court of International Trade Strikes Down Trump’s Liberation Day Tariffs

This is an enormous ruling. 5 Reasons the court is correct.

Court Strikes Down Trump’s Reciprocal Tariffs

I am 100% pleased to report Trade Court Strikes Down Trump’s Global Tariffs

A federal trade court ruled President Trump didn’t have the authority to impose sweeping tariffs on virtually every nation, voiding the levies that have sparked a global trade war and threatened to upend the world economy.

The decision on Wednesday from the Court of International Trade blocked one of the Trump administration’s most audacious assertions of executive power, under the International Emergency Economic Powers Act of 1977. Shortly after the decision was handed down, lawyers for the Trump administration notified the court they will appeal.

“The court does not read IEEPA to confer such unbounded authority and sets aside the challenged tariffs imposed thereunder,” a three-judge panel wrote.

Congress typically holds responsibility over tariffs but has delegated many powers to the president over decades. When he imposed the levies in April, Trump said the ongoing U.S. trade deficit had created a national emergency that has hobbled the economy and posed an unusual and extraordinary threat.

Wednesday’s ruling said it would be unconstitutional for Congress to delegate “unbounded tariff power” to the president. “An unlimited delegation of tariff authority would constitute an improper abdication of legislative power to another branch of government,” the court said. Congress placed limits in IEEPA, restricting when and how a president could place levies, the ruling said.

The panel also said the U.S. trade deficit didn’t fit the law’s definition of an unusual and extraordinary threat.

If upheld, the ruling means the Trump administration must find another justification for its global tariffs. The administration has previously contemplated imposing duties under Section 301 of the Trade Act of 1974, which allows for tariffs that counter unfair foreign trade practices. That is the provision Trump used to underpin his first term tariffs on China and is considered to be on firmer legal footing than IEEPA.

The “Liberation Day” tariffs placed 10% levies on every nation. Trump imposed even higher rates on many countries he deemed “bad actors,” but later announced a 90-day pause on those duties. Trump ratcheted up tariffs on China to as high as 145% and then lowered them again to 30%.

Brian Marshall, a lawyer for the Oregon attorney general’s office, said at a hearing for the states’ case that Trump’s tariffs were unprecedented and untenable.

“The government argues that so long as the president says he’s confronting an unusual and extraordinary threat that he can set tariffs of any amount from any country for any length of time, and no court may review it,” Marshall said during the hearing. “That’s a position that no court has ever embraced and, until this year, power no president has ever asserted.”

Justice Department attorney Brett Shumate conceded at one of the hearings that the court has the power to decide whether the language in IEEPA grants the president the authority to impose tariffs. 

“It is not for the role of the court to decide whether the president has appropriately used that authority,” Shumate said. Whether a true emergency existed is a political question for the executive and legislative branches to decide. EEPA includes checks that allow Congress—not a judge—to review the president’s conclusions and actions, he said.

The judges were skeptical of Trump’s unilateral actions. During one hearing, Judge Janet Restani posed a question of whether that meant the president could declare an emergency over a national shortage of peanut butter, an inconvenience to some but not necessarily a crisis. 

“Peanut butter becomes a political question,” she said. 

Jeffrey Schwab, a lawyer for the plaintiffs in the V.O.S. case, said the court has the power to review the legitimacy of Trump’s tariffs. He acknowledged a court at times might have difficulty determining what is and isn’t a national emergency, but not in this matter. “This case is so far outside of what an emergency is and what is unusual and extraordinary,” he said.

National security tariffs imposed on products like steel and aluminum, as well as similar duties planned on sectors like lumber and semiconductors, are justified under a different law and wouldn’t be affected by the ruling.

The Constitutional Case

Please note “Justice Department attorney Brett Shumate conceded at one of the hearings that the court has the power to decide whether the language in IEEPA grants the president the authority to impose tariffs.” 

Oops. The word tariff is not even in the act. Nor are synonyms like duties.

Second, there is no emergency. An emergency is a sudden unexpected crisis. Trade deficits have existed for decades.

Third, there is no unusual or extraordinary threat. Trump has even imposed tariffs on nations with which we have no trade deficit including islands inhabited only by penguins.

Fourth, there is lack of a clear authorization by Congress to grant Trump such authority. The applicable principle involved is called “major question”.

The Tax foundation estimates the cost of Trump’s tariffs to be over $2 trillion. If that’s not a “major question” then what is?

This is a similar to the setup in which Biden attempted to suspend student loans that would also have an impact of $400 billion.

Trump seeks a bigger than any previous Supreme Court “major question” ruling including student loans.

Finally, we get to the issue of delegation. The Supreme Court has ruled that Congress has no authority to simply giving away its constitutional rights.

Thank You Court!

Hooray! Massive cheers for the court in blocking Trump’s tariffs.

Thank you court for a logical ruling.

Trump was begging for this ruling with nonsense like declaring movies a national security threat.

Related Posts

April 2, 2025: Trump’s Big Announcement Is Half-Reciprocal Tariffs on the World

Factoring in value added taxes and other alleged manipulations, Trump announces Half-Reciprocal Tariffs with a minimum baseline of 10 percent.

April 13, 2025: Tariff Clown Show Continues, Tech Tariffs Back On, Separately

What a revolving door circus Trump’s tariff policy has become.

May 4, 2025: Movies Are Now a National Security Threat, 100 Percent Tariffs Announced

Trump: “WE WANT MOVIES MADE IN AMERICA, AGAIN!”

Commerce Secretary Howard Lutnick posting on X said: “We’re on it.”

May 20, 2025: Hoot of the Day: Trump Threatens a Return to Reciprocal Tariffs

We’ve gone from 200 deals “100%” to threats of returning to reciprocal tariffs if countries don’t deal.

It’s pretty damn hard to claim “emergency” when you turn tariffs on and off repeatedly for months then make idiotic claims like movies are a national security threat.

Case closed. The constitution case I presented above is rock solid.

The irony is Trump wanted the Court of International Trade to decide this issue because it had Trump-appointed judges.

Wish granted!

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Mish

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MPO45v2
MPO45v2
6 months ago
Reply to  Mike Shedlock

I hope you’ll write a post about assuming SCOTUS affirms the lower court decision, what does this do for Fed rate cuts? If goods start flowing again at lower (or no) tariffs, I expect inflation to come down, at least temporarily, so will that give the Fed the green light to cut rates? If the Fed cuts, stocks will go past the moon right to Jupiter.

Inquiring minds want to know.

Last edited 6 months ago by MPO45v2
meltdownman
meltdownman
6 months ago
Reply to  Mike Shedlock

What you obviously failed to consider were the alternative options Trump has at his disposal.

The Wall Street bank said the ruling blocks the 10% baseline tariff imposed by Trump on most imports, as well as the additional duties on China, Canada and Mexico – but not sectoral levies, such as those imposed on steel, aluminum and autos.

The Trump administration nevertheless has other legal means of imposing tariffs, Goldman says, flagging Section 122 of U.S. trade law, Section 301 investigations and Section 338 of the Trade Act of 1930.

Section 122 of the Trade Act of 1974 does not require a formal investigation and could therefore be one of the swiftest ways to get around the court roadblock.

“The administration could quickly replace the 10% across-the-board tariff with a similar tariff of up to 15% under Sec. 122,” analysts at Goldman said. They noted, however, that such a move would only last for up to 150 days after which law requires congressional action.

TandJ
TandJ
6 months ago

Bring on the civil war. Great idea… Trump (his team actually) just illustrated to a large swath of America how other countries take advantage of us. Now, our own courts hand China a huge win on the back of us all understanding how the Chinese et al are using every dirty trick in the book to take over the world on the backs of every day Americans.

Think it through people. This is dangerous dangerous behavior via the same people that told us open borders were a great idea. I, for one, hope to hell there are not shots fired.

IRISH
IRISH
6 months ago

good cut him down to size . he is a moron.

Phil in CT
Phil in CT
6 months ago
Reply to  IRISH

As is anyone who voted for him!

Victoria "the Hutt" Nuland
Victoria “the Hutt” Nuland
6 months ago

So now I can import as much as I want from Ireland, even more than the $800 de minimus, without getting hit by the tariff? Is this correct?

Victoria "the Hutt" Nuland
Victoria “the Hutt” Nuland
6 months ago
Reply to  Mike Shedlock

That is so awesome, Mish. You’ve really made my day, and we’re only one hour into it!

alx west
alx west
6 months ago

not yet. it seems you are not from USA

appeals will be coming

Lawrence Bird
Lawrence Bird
6 months ago

I believe it was Reagan, Obama and Trump I appointees so no crying about bias

Sherman 45
Sherman 45
6 months ago

Mish : You must be a globalist ! Will you celebrate when USA collapses ???

alx west
alx west
6 months ago
Reply to  Sherman 45

there is more..
ASK MISH IS HE DUAL CITIZEN?

=humor=

alx west
alx west
6 months ago
Reply to  Sherman 45

=USA collapses ???

mor11on!!

USA collapsed when it went into middle east under false pretense during bush jr.

remember wmds debacle!!

and BUILDING #7 COLLAPSED ON 9*11, in free fall w/out being hit

get lost cia bot!

bmcc
bmcc
6 months ago
Reply to  Sherman 45

perhaps mish is both a earth globalist and a martian globalist, like musk. mish is dead on consistent with his libertarian thoughts. i tip my hat to you mish. TACO thank heavens.

David Heartland
David Heartland
6 months ago
Reply to  bmcc

I am using “T.A.B.U” and it stands for: “Trump Always Bullshits Us.”

NO, I do not vote and never have. I save gas and time in that way and have NO expectations. I am here for the Clown Show, continued from Clinton-Obama-Bush-Bush-Trump era’s of politics.

Politics means: LYING/CHEATING/STEALING with smoke and mirrors. Trump is the master of Ceremonies with a lick buffoonery.

EADOman
EADOman
6 months ago
Reply to  Sherman 45

$58 trillion in debt by 2035, 135% of GDP, as a result of the Big Beautiful Bill. Who is pushing the US towards economic collapse?

misc
misc
6 months ago

The Court of International Trade is a civil court.

The press should give it the same credibility as a traffic court declaring that corporations aren’t people.

Just more anti-Trump hype.

PapaDave
PapaDave
6 months ago
Reply to  misc

And yet the International Court of Trade is where Trump WANTED the case to be heard.

misc
misc
6 months ago
Reply to  PapaDave

I’m sure he would’ve liked it to be in Small Claims.

Lefteris
Lefteris
6 months ago

If Congress pass regulations on standards of imported goods (health codes, electrical codes, etc), it will be worse than tariffs, and will destroy China’s exporting sector. Just ask the Democrats to draw a list of their favorite regulations (they got plenty!) and vote on them.

alx west
alx west
6 months ago

most amusing thing = STONKS ARE UP, wall street loves it.

so 2+trln budget deficit, 1+ trn trade deficit are forever!
and $ 45 trln debt by end of trump term!

well…

you have been warned !

alx

PapaDave
PapaDave
6 months ago

Darn. I was hoping tariffs would last long enough that we could see their economic impact.

Perhaps we will now avoid the recession that they would have caused later this year.

D. Olson
D. Olson
6 months ago

Our Constitution and our Presidency has serious defects, and needs some revision. With reference to some history I was reading earlier today, maybe one of those revisions will markedly strip powers from Presidents such as HindenTrump (reference to the original ruling Germany by decree from 1930 to 1934, and the rewrite of Germany’s ‘constitution’ in 1948.) Maybe assign those powers to someone else, or maybe Tenth Amendment assign those powers and authorities to the state governors.

Mark
Mark
6 months ago
Reply to  D. Olson

Agreed.

From my limited knowledge of history…. The formation of the United States of America and it’s constitution was ground-breaking at its time…. Dozens of nations modelled their statehood on the roots of the US. That is something to be proud of.

However that was over 200 years ago. The foundations of good governance has progressed significantly in that time. In some ways USA has progressed with that even though it has been through ethical convention rather than constitutional law.

Trumps RULE is showing showing some significant cracks in the constitution and the legal system holding politicians to account… On the flipside some rules are showing that there is still life in the legal system’s checks and balances.

I only hope that the US learns from this craziness.

Ted
Ted
6 months ago

The court had only 1 Trump appointed judge. Also, Trump can still put high tariffs on foreign products to protect american industries and workers via section 232, 302 and 338. It’s not like Trump can’t do anything. I hope Trump comes out swinging and puts tariffs on every foreign product that has destroyed american manufacturing and lead to the loss of millions of middle class jobs. I would also like to see Trump initiate the process of revoking China’s PNTR and then hopefully congress will follow through and pass legislation making it official.

PapaDave
PapaDave
6 months ago
Reply to  Ted

1 Trump appointed judge, 1 Reagan judge, and 1 Obama judge. All 3 agreed.

Yes, there is hope that Trump can still issue “some” tariffs and start a recession later this year. If he can keep his tariffs on steel and aluminum, it will raise input costs for US manufacturers and really drive a stake through their hearts.

Ghost poster
Ghost poster
6 months ago
Reply to  Ted

You must be eight years old, corporate America moved production overseas for the sake of high profits and satisfied shareholders.

IT WASN’T FOREIGN corporations…

I am all for it because I’m a capitalist, are you some kind of pinko commie?

Greed is GOOD.

IN THE GOOD OLD USA!!!

Yikes!

Look it up SHERLOCK!

Then, come back here with links to your research whereby non USA corporations came here, to the USA, and stole our production closing all our manufacturing then built factories over there.

Please, I beg you to look it up.

I’m back robbyrob
I’m back robbyrob
6 months ago

Businesses are finding a workaround for tariffs — and it’s entirely legal
https://www.cnbc.com/2025/05/26/businesses-are-finding-a-tariff-workaround-the-first-sale-rule.html

Jchb
Jchb
6 months ago

I am fully with the court on this one. Trump was/is way over his skis on the whole issue of tariffs.

MPO45v2
MPO45v2
6 months ago

Excellent post. As smart people predicted, justice served.

Now how long before the MAGA cult screams “activist judges!” ROFLMAO!

CzarChasm Reigns
CzarChasm Reigns
6 months ago
Reply to  MPO45v2

The cult is in the house…

”White House deputy chief of staff for policy Stephen Miller was blunter, posting on X that ‘The judicial coup is out of control’ in response to the news.”

https://www.cnn.com/2025/05/28/business/us-court-blocks-trumps-tariffs

bmcc
bmcc
6 months ago

when jews become nazis it’s most absurd. miller’s wife’s family have disowned her. a devout jewish family i have ties with.

Calvin Garvin
Calvin Garvin
6 months ago

I don’t tell this to many people Mish, but my wife used to be over International Trade for the US Gov under the Clinton administration (I married her anyway). One of her primary responsibilities was taking care of and dealing with Tariffs. She is not a fan of Trump, but out of the blue she said to me one day a few weeks ago driving down the road, “what Trump is doing with Tariffs is so spot on.” Wow…if I had been on a chair at home I would have fell off. I was surprised she took that position. Lots of whys….

alx west
alx west
6 months ago
Reply to  Calvin Garvin

=what Trump is doing with Tariffs is so spot on.

women say a lot cra1p, and should mostly stick to the kitchen

alx

Ghost poster
Ghost poster
6 months ago
Reply to  Calvin Garvin

Well, if you folks are on the INSIDE receiving potus alerts to go short, or long, then yes, potus is SPOT ON with tariffs in your family’s life!

Otherwise a cognitive test for the love of your life is in order.

TandJ
TandJ
6 months ago
Reply to  Calvin Garvin

Interesting. My partner was recently in Luxembourg. They were out to dinner and one of the people at their table was a Swedish diplomat. He also said “being honest, Trump is correct about the tariffs”.

Amazing how many people don’t even understand the tariffs. At the end of WW2, countries were allowed to create favorable trade agreements (Asia and Europe) to rebuild their war ravaged economies. They did that. They were never meant to be permanent — but they somehow slow drifted into permanance. It’s time the trade advantages end. Thats it. Not complicated.

Tony Frank
Tony Frank
6 months ago

FINALLY, some good news, assuming the supreme court upholds the ruling.

Stock futures are up as expected.

Nate
Nate
6 months ago
Reply to  Tony Frank

All they have to do is not hear it.

Irondoor
Irondoor
6 months ago
Reply to  Tony Frank

Futures up, futures down, stocks go round and round. How long ago was it that we lived in a serious country? 60 years? 100?

bmcc
bmcc
6 months ago
Reply to  Irondoor

happy days was the decline of seriousness. post ww2 it was kewl to be stupid.

Bill
Bill
6 months ago
Reply to  Tony Frank

Yes, but we’ve become sickeningly lazy in assessing whether policy is good by how the market perceives it. If that were the case, since march 2009 there hasn’t been one bad policy other than covid, however the outsized fiscal/monetary response was loved. How’s that working out for us?

Futures also up on the cap weighted index impacted by NVDA up 5+% AH.

Note futures are up even though they’ve already retraced the entire post-liberation-day pause. It’s the gift that keeps on giving (if you own equities).

alx west
alx west
6 months ago
Reply to  Tony Frank

=good

so 2+trln budget deficit, 1+ trn trade deficit are forever!
and $ 45 trln debt by end of trump term!

Maximus Minimus
Maximus Minimus
6 months ago
Reply to  Tony Frank

The fact stock market futures are up is exactly why tariffs are needed to support onshoring. Wall Street already made a fortune outsourcing, and would be delighted to continue.
Just because Trump has a moronic approach to onshoring and tariffs doesn’t mean the case doesn’t exist.

Lawrence Bird
Lawrence Bird
6 months ago

“wall street made” 62% of Americans reported owning stock directly or in a retirement account. Then add in pension funds.

bmcc
bmcc
6 months ago

sounds like you would be more at home living in Xi’s centrally planned capitalism economy. but perhaps you do live there. i have no clue. but you sound wild. TACO thank heavens.

bmcc
bmcc
6 months ago

TACO donald saved by the court. MAGA cult dreams of high paying factory jobs for unskilled labor evaporated. back to cooking meth middlebrows.

Art
Art
6 months ago
Reply to  bmcc

Traders will be upset – no more TACO trade….But then I am sure Donald will come out with something new…lol.

bmcc
bmcc
6 months ago
Reply to  Art

aye aye

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