Last week, the US Supreme Court decided to delay its decision about whether or not President Donald Trump abused his executive power by imposing tariffs upon foreign countries using emergency laws. This has caused everybody in Washington to become very concentrated on the ruling of the Supreme Court as there are many important ongoing legal issues surrounding the legality of Trump's tariff programmes.
When is the SC decision expected?
The court may issue a ruling as soon as Wednesday, however there isn't any evidence to suggest this will occur or will be delayed until later in the week or month.
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The ruling from the court will determine if President Trump has the legal ability to impose tariffs under the authority of the International Emergency Economic Powers Act (IEEPA) due to national security reasons.
Trump's tariff policies are largely based on the authority established by this statute. The lower courts have previously held that some of the tariffs imposed by Trump were not lawful.
Is Trump anxious?
Trump's anxiety is evident. In a series of Truth Social posts, he warned people that if he is found guilty, the financial repercussions for the US government would be extremely severe.
"If the Supreme Court rules against the United States of America on this National Security bonanza," Trump wrote, "WE’RE SCREWED!"
According to Trump's post on Truth Social, if tariffs were to be paid back, it would be a "complete mess" that would cost hundreds of billions of dollars (or possibly trillions if you look at the overall financial impact on the economy).
In his post, Trump claimed that repaying tariffs would ultimately be an unmanageable disaster for the United States.
"It may not be possible. But if it were, it would be Dollars that would be so large that it would take many years to figure out what number we are talking about and even, who, when, and where, to pay," he said.
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Options before the Supreme Court
Option 1: Tariffs ruled illegal
In case the Supreme Court terms the tariffs illegal, Trump would have to refund and repay the money amounting to "many Hundreds of Billions of Dollars". Should the court order refunds, the US government would likely be required to refund tax revenue previously collected by the government.
Analysts predict that this amount may total over $150 billion and the refunding process could financially cripple the federal government and lead to an influx of additional lawsuits against the government.
However, in another option, the Supreme Court may declare tariffs illegal but does not order refunds. While this will still come as a blow for Trump but in this case, his government wouldn't have to repay the massive amounts.
Option 2: SC upholds tariffs
In case the Supreme Court rules in favour of Trump, it would come as a landslide victory for him and validate his approach to trade and strengthen executive authority over economic policy.
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Moreover, such a ruling will encourage future presidents to bank heavily on emergency powers to impose trade curbs, despite the congressional nod.
Option 3: SC delays decision
The ruling could also be put off by the court with it requesting further discussion about the issue. However, the delayed judgment would prolong uncertainty for businesses, traders and governments. While the tariffs would remain in place for now, but their legality would keep hanging in the balance.
