A signature policy of Donald Trump’s “America First” agenda has been deemed unlawful by a federal appeals court. The court ruled that his administration illegally wielded a national emergency law to impose tariffs on a global scale, a decision that could unravel a key part of his economic legacy.
The judgment states that the former president exceeded his statutory authority under the International Emergency Economic Powers Act (IEEPA). The court was unpersuaded by the argument that a trade deficit constitutes the kind of national emergency Congress envisioned when it passed the act, which has historically been used for actions like sanctioning terrorist organizations.
This ruling sends shockwaves through the international trade community. Deals struck under the shadow of these tariffs are now vulnerable, and the decision could embolden countries to challenge the terms they accepted. It also opens the door for U.S. companies to seek reimbursement for the billions of dollars they paid in what the court has now labeled illegal duties.
A Supreme Court battle now seems inevitable, as Trump has promised to challenge the ruling. The case will test the judiciary’s role in policing the boundaries of presidential power and could lead to a definitive statement on how far a president can go in using emergency powers for economic objectives.