That’s the conclusion of a new Cato Institute report by Clark Packard and Scott Lincicome. Being libertarians, they are not happy about this fact, but the relevant laws and regulations as currently written give the president very broad authority to impose tariffs.
Article I, Section 8, of the Constitution very clearly gives the power to impose tariffs to Congress. It used that power extensively in U.S. history. Tariff bills were often among the top legislative fights in any given Congress. Tariff policy shifted over time from low rates on many goods to raise revenue to high rates on specific goods to protect industry.
Then Congress passed the Smoot-Hawley tariff law (key parts of which are still on the books) in 1930, which aside from being an economic disaster was also a political disaster for the Republicans who passed it. Congress saw the consequences of getting blamed for tariffs and sought to offload that responsibility to the president.
It also believed that the president would be more reliable to act in the national interest, since he does not have a legislative district with companies to please. That was a bit naive, as there are still plenty of ways for interest groups to lobby through the bureaucracy and get special favors, and presidents have acquiesced to their wishes in many specific instances. But overall, since the 1940s, presidents have generally used their trade powers to reduce trade barriers and expand market access for U.S. companies.
The laws that presidents can use for trade were not written with Donald Trump in mind. “Several US laws authorize the president to impose tariffs on a wide range of imported goods without substantial procedural or institutional safeguards on their use,” Packard and Lincicome write. “One can reasonably argue that Congress did not intend for a president to use these laws as Donald Trump is now promising, but their broad and ambiguous language could let a future president plausibly claim otherwise.”
For example, they write that:
-
- The International Emergency Economic Powers Act of 1977 “confers wide discretionary authorities to the president to restrict international commerce on ostensible national security grounds or to advance foreign and economic policy goals” and “aside from minor reporting and consultations with Congress . . . the only serious check on IEEPA authority is the requirement that the president declare an emergency . . . which can be done at any time.”
- Section 301 of the Trade Act of 1974 “contains some minor substantive and procedural checks, but it does grant the president wide discretion to address foreign economic policies by imposing tariffs or other trade restrictions on a very wide set of products imported from a targeted country or countries.” The law, which is supposed to increase trade by using the threat of tariffs to counter other countries’ unfair practices, has already been hijacked by Trump and Biden to pursue protectionism.
- Section 232 of the Trade Expansion Act of 1962 “grants the president wide discretion to initiate an investigation and then impose trade restrictions such as tariffs on a certain category of products.” It might require investigations and reports for each product to create a universal tariff, but “aside from that limitation, Section 232 provides virtually no substantive or procedural checks on the president’s authority to impose security-based trade restrictions.” It was hardly used at all until Trump’s presidency, suggesting this was probably not a law the U.S. needs in the first place.
- Section 338 of the Tariff Act of 1930 has never been used to impose trade restrictions and has a similar stated purpose as Section 301. Yet, “the statute remains on the books, confers wide authority to the executive branch, and could therefore be ripe for abuse by a protectionist administration.”
- Section 122 of the Trade Act of 1974 “has not been invoked to impose trade restrictions, but a president could theoretically use it to unilaterally implement a 15 percent global tariff for 150 days.” The law is supposed to address balance-of-payments problems, and after 150 days would require an affirmative vote of Congress to continue the tariff.
In recent years, two bipartisan bills to amend the laws to require congressional approval of presidential tariff decisions never made it to the floor. Even if they had, Congress is stuck in the catch-22 of delegating its powers to the president: The president can veto bills that would take the power back.
The Trump and Biden administrations have both defended executive tariff powers in court. “Despite the appearance of significant procedural and substantive flaws surrounding the tariffs’ implementation, the courts have ultimately sided with the executive branch in every case thus far,” Packard and Lincicome write. And that’s especially true for anything justified on national-security grounds, even if those grounds are specious, as national security is an Article II power of the president that courts stay away from.
Dismissing Trump’s tariff proposals as crazy campaign rhetoric that he couldn’t act upon is not correct. There’s a whole mess of broad laws with few checks on the president that a team of lawyers could probably finagle into an airtight case for unilateral tariffs before a federal judge. Impossible to finagle are the laws of economics, which will govern the consequences of tariffs regardless of their legal justification.