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Speaker 1: This is Bloomberg Law with June Grosseo from Bloomberg Radio.

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Speaker 2: It's one of the most important cases of the term,

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Speaker 2: a test of presidential power where President Trump's signature economic

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Speaker 2: policy is at stake. After nearly three hours of oral arguments,

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Speaker 2: it appears that a majority of Supreme Court justices across

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Speaker 2: the ideological spectrum are skeptical that Trump has the legal

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Speaker 2: authority to impose billions of dollars of tariffs on goods

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Speaker 2: from nearly every country. Chief Justice John Roberts and Justice

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Speaker 2: Sonya Sotomayor said, the tariffs are taxes, and the Constitution

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Speaker 2: gives taxing power to Congress.

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Speaker 3: It's a congressional power, not a presidential power to tax.

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Speaker 3: And you want to say tarifts are not taxes, but

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Speaker 3: that's exactly what they are, degenerating money from American citizens revenue.

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Speaker 4: The vehicle is in position of taxes on Americans, and

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Speaker 4: that has always been the core power of Congress.

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Speaker 2: Trump is arguing that an emergency powers law, the International

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Speaker 2: Emergency Economic Powers Act, or AIPA, authorizes him to collect

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Speaker 2: tens of billions of dollars in tariffs a month. AIPA

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Speaker 2: gives the president an array of tools to address national security,

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Speaker 2: foreign policy, and economic emergencies. But it doesn't mention tariffs,

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Speaker 2: something many of the justices work quick to point out.

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Speaker 2: Here are the Chief Justice and Justice Katanji Brown Jackson.

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Speaker 5: But when I read the statute, it is telling the

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Speaker 5: president exactly what he can do investigate, block during the

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Speaker 5: pendency of an investigation, regulate, direct, and compel, mullify, void,

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Speaker 5: prevent or prohibit. And I guess what is a little

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Speaker 5: concerning to me is that your argument suggests that we

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Speaker 5: should see the word imposed, the phrase impose tariffs in

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Speaker 5: that se series of things that the president could do.

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Speaker 5: We don't see that word.

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Speaker 4: Well, but the exercise of the power is to impose tariffs, right,

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Speaker 4: and the statute doesn't use the word tariffs.

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Speaker 2: And Justice Neil gorse At, a Trump appointee, expressed alarm

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Speaker 2: at giving seemingly limitless power to presidents.

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Speaker 6: So Congress is a practical matter. Can't get this power

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Speaker 6: back once it's handed it over to the President's a

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Speaker 6: one way ratchet towards the gradual but continual accretion of

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Speaker 6: power in the executive branch and away from the people's

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Speaker 6: elected representative.

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Speaker 2: My guest is constitutional law expert Michael Dorff, a professor

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Speaker 2: at Cornell Law School. Mike, give me your broad take

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Speaker 2: on the oral arguments.

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Speaker 7: It was difficult to handicap.

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Speaker 1: It's clear to me that the three Democratic appointees are

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Speaker 1: going to vote to a firm and rule for the plaintiffs.

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Speaker 1: Justice Thomas and almost certainly Justice Alito are going to

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Speaker 1: rule for the government. I think Justice Kavanaugh pretty strongly

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Speaker 1: leans towards the government, and then the Chief Justice and

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Speaker 1: Justices Gorosach and Barrett are harder to handicap because Gorisiach

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Speaker 1: and Barrett especially asked difficult questions of each side, and

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Speaker 1: I kind of have a theory of what each one

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Speaker 1: of them is thinking, but it's it's very difficult to say.

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Speaker 1: So I come out of this really quite uncertain as

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Speaker 1: to what they're going to do.

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Speaker 2: So a good deal of the argument consisted of an

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Speaker 2: analysis of the text of AIPA. Several justices quizzed the

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Speaker 2: Solicitor General on the text not mentioning tariffs. How do

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Speaker 2: you think the Solicitor General handled that?

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Speaker 1: Yeah, I thought He's stuck with his core argument, which

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Speaker 1: has a number of moving pieces. The first is that

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Speaker 1: the term regulate importation can include tariffs just as a

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Speaker 1: matter of ordinary language.

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Speaker 7: That's certainly true.

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Speaker 1: He also relied on historical understandings dating back to the

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Speaker 1: founding for some reason to think that that's how the

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Speaker 1: word was understood. And he has a couple of modern cases.

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Speaker 1: He's got the Nixon president under the Trading with the

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Speaker 1: Enemy Act, and he's got another related case. I thought

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Speaker 1: he had the hardest time dealing with what is really

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Speaker 1: the plaintiff's best argument, and that is that when Congress

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Speaker 1: has wanted to give the president tariff authority, it has

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Speaker 1: said so expressly in lots of other statutes, and so

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Speaker 1: the omission in this statute does seem to be rather glaring.

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Speaker 1: So I thought he did a perfectly fine job basically

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Speaker 1: rehashing what was in his brief.

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Speaker 2: It seemed to me like some of the justices weren't

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Speaker 2: satisfied with Sour's answers, particularly Justice Amy Coney Barrett. You know,

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Speaker 2: she kept pressing him and just a soda mayor said

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Speaker 2: answer the question.

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Speaker 7: Yeah.

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Speaker 1: So that was an important exchange, and I thought that

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Speaker 1: Justice Barrett wasn't being quite fair to his argument, right,

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Speaker 1: which was he said not only that did Nixon impose this,

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Speaker 1: but a Court of Appeals found that Nixon had the authority.

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Speaker 1: It's true of the Supreme Court denied assert and then

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Speaker 1: Justice Barrett said, well, it's just an intermediate court of appeals. Well,

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Speaker 1: that's true, But his argument is not that that ruling

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Speaker 1: is binding on the Supreme Court. His argument is that

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Speaker 1: when Congress copied the language from the Trading with the

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Speaker 1: Enemy Act into the International Economic Emergency's Powers Act, it

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Speaker 1: was aware that President Nixon had used this for tariff

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Speaker 1: authority and that that had been affirmed, and so we

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Speaker 1: should attribute to Congress an intention to carry over the

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Speaker 1: meaning that had recently been on display.

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Speaker 7: That's not a bad argument.

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Speaker 1: My own view is that it should fail because even

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Speaker 1: a good textualist care about how Congress has used the

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Speaker 1: terms elsewhere, but just sort of standing on its own.

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Speaker 1: I thought his reliance on the Nixon president was pretty sensible.

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Speaker 2: Justice Neil Gorsuch question the Solicitor General for something like

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Speaker 2: ten minutes. Some of the questioning seemed a little bit hostile.

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Speaker 2: He questioned him about the extent of the authority Trump

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Speaker 2: is claiming, saying, well, then can Congress just say we're

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Speaker 2: tired of legislating or hand it off even the power

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Speaker 2: to declare war to the president. I mean, he seemed

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Speaker 2: more aggressive than most of the other justices in questioning

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Speaker 2: the Solicitor General.

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Speaker 1: Yeah, I think that's right, and I think it lines

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Speaker 1: up with Justice Garsuch's priors, which are very suspicious of

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Speaker 1: broad delegations to the executive branch. He actually got a

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Speaker 1: concession out of the Solicitor General. The SG sort of

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Speaker 1: began by saying that neither the non delegation.

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Speaker 7: Doctrine nor the Major.

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Speaker 1: Questions doctrine applies with respect to the president's foreign affairs.

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Speaker 7: Power, and pressing him.

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Speaker 1: Justice Grocich got him to back off of that when

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Speaker 1: he said, well, what if Congress just gave the president

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Speaker 1: all of its power to regulate foreign commerce, you know,

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Speaker 1: do whatever you want. We're sick of it all of

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Speaker 1: its power more generally, you know, could he do anything

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Speaker 1: at all in international affairs? And soer basically said, well, no,

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Speaker 1: that would be different in so of coursious.

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Speaker 7: How could it be different? You said that it doesn't

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Speaker 7: apply at all in.

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Speaker 1: Foreign affairs, And so then I thought Justice Garsuch did

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Speaker 1: a nice job of saying, So, what you're saying is

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Speaker 1: it applies more deferentially. But the intelligible principal test, which

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Speaker 1: Justice Gorsuch doesn't like, is already very deferential. You're going

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Speaker 1: to say it's even more deferential than that. So based

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Speaker 1: on that exchange, I initially had Justice Garsage in the

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Speaker 1: sort of plaintiff's column, but then on the other side

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Speaker 1: he was pressing Neil Kattil very hard on us. The text, right,

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Speaker 1: So if you just look at the text, it does

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Speaker 1: seem to encompass tariff authority. And there in the same

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Speaker 1: way that I thought it was interesting that the SG

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Speaker 1: backed off a little bit. I thought Katyo would have

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Speaker 1: been better served if he had backed off a little

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Speaker 1: bit and just simply said, yeah, you're right, if you

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Speaker 1: look at the text in isolation, it does encompass this power.

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Speaker 1: But that's never how the discourt looks at datutory text,

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Speaker 1: and it shouldn't in this case.

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Speaker 2: Well, let me ask you this, as some of the

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Speaker 2: justices porning out Congress knew how to write the word tariff.

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Speaker 2: They wanted tariffs to be included in all these other powers,

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Speaker 2: why not just put it there?

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Speaker 7: Right?

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Speaker 1: I think that is sort of the core common sense

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Speaker 1: argument that the plaintiffs have, and it's a very good one,

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Speaker 1: and I thought it was going to prevail. That. What

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Speaker 1: leads me to be a little less certain about that

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Speaker 1: is the turn the argument took near the end of

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Speaker 1: Katyo's presentation, when a combination of Justice Barrett and some

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Speaker 1: of her colleagues pressed on what she said she wasn't

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Speaker 1: calling but really was calling a greater includes the lesser power, right,

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Speaker 1: which is, well, look, Congress clearly gave the president the

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Speaker 1: power to ban all trade with any and all foreign countries,

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Speaker 1: because that's the plain meaning of some of the terms

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Speaker 1: that are in the statute, and that's an enormous delegation.

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Speaker 1: If Congress did that, why would Congress want to deny

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Speaker 1: to the president the much lesser power to just say, well,

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Speaker 1: you can have trade with us, but it's going to

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Speaker 1: be subject to some tariff and that Therefore, maybe Congress

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Speaker 1: didn't mean to exclude tariffs. Maybe they just thought it

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Speaker 1: was encompassed within the term regulate. So that's what gave

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Speaker 1: me some pause, because that's also not a crazy argument.

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Speaker 1: I do think, and I'm going to put this on

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Speaker 1: my blog tomorrow, that the way out of that, at

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Speaker 1: least for Justice Gorsuch, may be that in so far

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Speaker 1: as this law seems to give the president the power

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Speaker 1: to declare an emergency whenever he wants and then to

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Speaker 1: ban all foreign trade or to do some subset of it.

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Speaker 1: That's a violation of the non delegation doctrine. And therefore

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Speaker 1: you can't read the statute that broadly, and we can

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Speaker 1: deal with a ban on all trade when that comes up,

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Speaker 1: or you can say the president's declaration of an emergency

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Speaker 1: is subject to some substantial review by the Supreme Court.

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Speaker 1: There was a point earlier here in the argument when

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Speaker 1: Justice Kagan was saying, we're going to review only very deferentially,

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Speaker 1: the president's decision that there's an emergency.

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Speaker 7: But you know, I mean, let's be frank here, there

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Speaker 7: is no emergency. At one point sour said, well, you know,

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Speaker 7: there's an existential threat, and it's not clear what he

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Speaker 7: was talking about. Then he said, well, fentanyl is an

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Speaker 7: existential threat. Well, even if fentyl is an existential threat,

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Speaker 7: and of course it is to people who are at

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Speaker 7: risk of overdosing on.

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Speaker 1: It, there's no indication whatsoever that that was a legitimate

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Speaker 1: justification for the tariffs on Canada, which is one of

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Speaker 1: the reasons why it was invoked. You know, we get

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Speaker 1: less than one percent of fentanyl from Canada, and you

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Speaker 1: know Soalar also pointed to the fact that when President

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Speaker 1: Trump was recently in Asia, he in Jijenping agreed to

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Speaker 1: some reduction in Chinese precursor chemicals coming over for feednyl.

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Speaker 7: You know, that's not.

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Speaker 1: A trade agreement, it was an agreement to discuss. So

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Speaker 1: there's all of this stuff in the background that seems

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Speaker 1: kind of detached from reality, and that the background as

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Speaker 1: well the president's you know, conducting foreign policy. The president

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Speaker 1: is you know, just imposing tariff's willy nilly because he

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Speaker 1: doesn't like, you know, some commercial that was run by

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Speaker 1: the government of Ontario, because he doesn't like that Brazil

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Speaker 1: is enforcing the law against Bolsonaro, whom he sees as

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Speaker 1: a kindred spirit. The notion that this president is exercising

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Speaker 1: this power in any way that remotely relates to legitimate

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Speaker 1: emergencies is just fanciful. And to me, the question is like,

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Speaker 1: will that break through at all or are they going

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Speaker 1: to do what they did in the immunity case and

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Speaker 1: pretend that Trump is a normal president.

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Speaker 2: Coming up next, I'll continue this conversation with Cornell Law

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Speaker 2: professor Michael, or what about the major questions doctrine that

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Speaker 2: the Court used to block many of President Joe Biden's initiatives.

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Speaker 2: This is bloomberg. It's the biggest legal test yet of

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Speaker 2: President Donald Trump's economic agenda, and a majority of Supreme

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Speaker 2: Court justices signaled some skepticism today about his power to

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Speaker 2: unilaterally impose sweeping tariffs. Trump says his tariffs are authorized

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Speaker 2: under the nineteen seventy seven International Emergency Economic Powers Act,

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Speaker 2: which gives him broad authority to set and change import

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Speaker 2: duties in an emergency. But Justice Elena Kagan questioned the

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Speaker 2: Solicitor General John Sower about the declared emergencies, referring to

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Speaker 2: the many cases the administration has brought to the Court

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Speaker 2: on an emergency basis since Trump took office.

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Speaker 5: And you know, we've had cases recently which deals with

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Speaker 5: the president's emergency powers. And it turns out we're in

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Speaker 5: emergencies everything all the time, about half the world. Well,

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Speaker 5: this particular emergency is particularly existential, as Executive Order fourteen

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Speaker 5: two five seven says, And of course no one disputes

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Speaker 5: the existential nature of the federal crisis.

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Speaker 2: I've been talking to Cornell Law School Professor Michael Darf, So,

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Speaker 2: let's talk about the Major Questions doctrine, which came up

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Speaker 2: over and over, and at one point Justice Gorsuch told

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Speaker 2: Neil Katiau, the attorney for the small businesses, I don't

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Speaker 2: think you can win without it. And Chief Justice John

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Speaker 2: Roberts indicated that he saw the case as being governed

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Speaker 2: by the Major Questions doctrine.

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Speaker 7: Yeah.

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Speaker 1: So the Major Questions doctrine originates in some cases a

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Speaker 1: couple of decades ago, but it really took its current

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Speaker 1: shape in a case from a few years ago called

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Speaker 1: West Virginia against EPA. And the basic idea is that

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Speaker 1: if you've got a statute that the federal executive brand

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Speaker 1: or the president claims gives them the power to regulate

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Speaker 1: some gigantic area, like a big portion of the economy

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Speaker 1: or which is clearly going on here, then the president

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Speaker 1: needs to point to specific authorization for what he's doing

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Speaker 1: in the statute. It's a way of reading the statute

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Speaker 1: to say, we're not going to presume that Congress delegated

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Speaker 1: enormous power to the president unless Congress did so clearly.

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Speaker 7: So, in lawyers.

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Speaker 1: Speak, the Major Questions doctrine can be understood as a

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Speaker 1: kind of clear statement rule.

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Speaker 7: So that's the background.

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Speaker 1: Now there's a there's a kind of technical debate between

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Speaker 1: different justices about what exactly the major questions doctrine is.

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Speaker 1: So Justice Barrett has said that she thinks it is

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Speaker 1: simply an interpretive canon. That is to say, it's out there.

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Speaker 1: It's a way of us figuring out what Congress actually

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Speaker 1: intended in this statute, because you know, Congress statutes where

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Speaker 1: they have, you know, meant to give all this power

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Speaker 1: without saying explicitly. So it relates back to something Justice

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Speaker 1: Scalia said in a much earlier case, which is, Congress

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Speaker 1: doesn't hide elephants in mouseholes, right, just a basic idea

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Speaker 1: of how you get at what Congress intended. That's one

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Speaker 1: view of the major questions doctrine. Another view of the

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Speaker 1: Major Questions doctrine is that it is a kind of

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Speaker 1: subconstitutional way of implementing the non delegation doctrine, the notion

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Speaker 1: that Congress can't give away its lawmaking power. It's got

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Speaker 1: to provide an intelligible principle. And so if there's some

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Speaker 1: very you know, monumental exercise of power, we're not going

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Speaker 1: to see Congress as having given that to the president

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Speaker 1: without explicit language, because the explicit language is what will

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Speaker 1: provide the intelligible principle. In the absence of that, we

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Speaker 1: will just assume the power hasn't been delegated. That's what

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Speaker 1: I mean by saying that it's related to this constitutional

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Speaker 1: So there's that debate. At one point, Neil Katyel seemed

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Speaker 1: to lean into the Barrett position to say, well, it's

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Speaker 1: just a matter of figuring out what Congress was up to.

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Speaker 1: Doesn't really matter for this case that he can he

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Speaker 1: can win regardless of what the nature of the Major

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Speaker 1: Questions doctrine is. When just as Gorsuch said to him,

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Speaker 1: I don't think you can win about the Major Questions doctrine.

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Speaker 1: I think what he was getting at was that the statute,

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Speaker 1: just taken at face value, uses the word regulate, which

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Speaker 1: historically has, at least in some contexts, included the power

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Speaker 1: to impose tariffs. I should say I think Justice Gorsach

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Speaker 1: is wrong about that. I mean, he might be right

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Speaker 1: as a prediction that, but I think he's wrong in that.

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Speaker 1: I think Katyl has a good argument that we don't

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Speaker 1: need the Major Questions doctrine, but we also don't. We

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Speaker 1: never read a statute literally and in isolation. That is

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Speaker 1: the text of the statute read against the backdrop of

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Speaker 1: all these other statutes Congress has enacted where it use

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Speaker 1: the word tariff or duty or custom or something like that,

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Speaker 1: and didn't use it here, tells us about the literal

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Speaker 1: meaning of the language here, So that I think there

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Speaker 1: is a textualist answer that doesn't rely on the Major

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Speaker 1: Questions doctrine that under which the plaintiffs win.

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Speaker 7: But you know, I'm just making an assessment.

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Speaker 1: If Justice Scurtius thinks that they can't win without the

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Speaker 1: Major Questions doctrine, then that suggests that if Cato is

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Speaker 1: going to win, it's going to be with the Major

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Speaker 1: Questions doctrine.

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Speaker 2: So, I mean, the conservative justices use the Major Questions

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Speaker 2: doctrine to block President Biden in his initiatives on student

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Speaker 2: loan forgiveness, coronavirus vaccine mandates, and climate change. How would

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Speaker 2: they reconcile it if they allow President Trump to exercise

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Speaker 2: sweeping emergency powers with these global tariffs.

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Speaker 7: Right, Well, so if they want.

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Speaker 2: To reconcile it, I guess right.

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Speaker 1: So the short answer is I don't think they can

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Speaker 1: in a way that is persuasive to me. But you know,

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Speaker 1: before the Supreme Court overruled the doctrine of Chevron deference

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Speaker 1: to administrative agencies in the Lower Bright case a year

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Speaker 1: and a half ago. Even then, there was a lot

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Speaker 1: of scholarship showing, I think, persuasively that the real meaning

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Speaker 1: of the Chevron defference doctrine was the Court deferred to

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Speaker 1: decisions it liked and didn't defer to decisions it didn't.

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Speaker 7: Like, and that had a political balance to it.

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Speaker 1: I think it would be child's play to write an

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Speaker 1: opinion here that says, of course, we have the major

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Speaker 1: questions doctrine, and what that requires is a clear delegation.

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Speaker 1: Here there is a clear delegation because regulate historically has

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Speaker 1: included the power to have tariffs and so forth. Right,

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Speaker 1: that is the threshold for applying the Major Questions doctrine

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Speaker 1: is a finding that Congress didn't clearly delegate. So they

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Speaker 1: would just say, well, Congress here in the text clearly

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Speaker 1: did delegate. I'm not saying that would be persuasive, but

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Speaker 1: I think that's that's what they would do.

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Speaker 2: And where did the you mentioned the non delegation doctrine?

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Speaker 2: Will that play in here.

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Speaker 1: Oh sure, So, I mean that's that was the line

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Speaker 1: of questioning that Neil that Justice Courses was pursuing against

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Speaker 1: the Solicitor General, which is, he wanted him to get

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Speaker 1: this SG to admit and successfully got him to admit

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Speaker 1: that under the government's theory of the case, Congress could

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Speaker 1: give to the president the authority to regulate the entire

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Speaker 1: economy if if there's any non delegation doctrine at all, Right,

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Speaker 1: there's no intelligible principle of Congress saying hey, if you

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Speaker 1: think it's a good idea, do whatever you want with

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Speaker 1: respect to foreign trade. And that's why sour the SG

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Speaker 1: eventually backed off of this position that there's no non

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Speaker 1: delegation doctrine in this area.

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Speaker 2: So you wouldn't be surprised then, if the court ends

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Speaker 2: up upholding Trump's ability to impose these tariffs undra AIPA.

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Speaker 7: I wouldn't be surprised with the result either way.

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Speaker 1: Again, as I said, I think that the given my priors,

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Speaker 1: I thought that the result of the argument is that

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Speaker 1: the plaintiffs should win. That's what I thought before the argument,

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Speaker 1: and I was heartened by the questions that at least

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Speaker 1: three of the conservative justices asked of the Solicitor General.

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Speaker 1: But this turn that the argument took near the end

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Speaker 1: suggests to me that it's certainly not a sure thing.

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Speaker 2: Anything else that struck you, Mike one thing.

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Speaker 1: So in my preview of the case on my blog

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Speaker 1: on Monday, I pointed to some remarkable statements very early

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Speaker 1: in the government's opening brief, quoting President Trump about how

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Speaker 1: magnificent these tariffs are. And I thought that was potentially

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Speaker 1: counterproductive because you know, it included, you know, typical Trumpian

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Speaker 1: rhetoric about how our country is, you know, going to

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Speaker 1: hell in a handbasket, and you know, thanks to me

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Speaker 1: and my beautiful tariffs, everything's working out. But if you

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Speaker 1: get rid of this, it'll be, you know, armageddon. I'm

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Speaker 1: not really exaggerating much. That's not using literal language, and

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Speaker 1: you know, it's just it was over the top rhetoric,

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Speaker 1: and it was also economically illiterate, right, the claim that

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Speaker 1: this is doing wondrous for the economy. And I noticed

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Speaker 1: during the course of the argument that Sour would occasionally

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Speaker 1: give versions of that not quite as over the top

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Speaker 1: as in the.

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Speaker 7: Brief, and he seemed to get no reaction at all.

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Speaker 1: From any of the justices except for Justice Kavanaugh, who

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Speaker 1: did seem to give some credit to Trump forgetting various

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Speaker 1: policies adopted In virtuous He pointed to the India tariffs

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Speaker 1: as serving you know, the foreign policy goal of getting

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Speaker 1: Russia to change its stand in the war against Ukraine,

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Speaker 1: and you know the effect on the fentnal precursors with China.

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Speaker 1: But for the most part, it struck me that the

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Speaker 1: reality of what's going on, which is, you know, this

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Speaker 1: mad king randomly imposing tariffs and then taking them off

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Speaker 1: because of.

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Speaker 7: His whims, didn't really penetrate.

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Speaker 1: And I think that's probably good for the government's case,

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Speaker 1: because the more that you look at what's really going

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Speaker 1: on here, the less it looks like any kind of

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Speaker 1: sensible policy.

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Speaker 2: We'll see what the decision is. Thanks so much, Mike.

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Speaker 2: That's Professor Michael Dorf of Cornell Law School. Coming up

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Speaker 2: next on the Bloomberg Lawn Show, we'll talk to a

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Speaker 2: trade lawyer about the oral arguments. The US Supreme Court

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Speaker 2: appeared skeptical of President Donald Trump sweeping global tariffs, as

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Speaker 2: key Justice Is suggested he'd overstepped his authority with his

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Speaker 2: signature economic policy. My guest is Timothy Bright Bell, partner

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Speaker 2: and coach of the International Trade practice at Wiley Rhein.

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Speaker 2: Tim tell us what's at stake in this case.

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Speaker 8: This case involves the centerpiece of President Trump's economic agenda.

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Speaker 8: This argument is the biggest trade case the Supreme Court

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Speaker 8: has ever heard, and it goes straight to the key

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Speaker 8: constitutional issue of who has the power to impose tariffs,

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Speaker 8: the US Congress or the president. President Trump says the

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Speaker 8: law that he used, the International Emergency Economic Powers Act,

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Speaker 8: gives him the power to regulate imports, and that that

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Speaker 8: includes the power to impose tariffs, including fentanyl tariffs on China, Canada,

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Speaker 8: and Mexico, and reciprocal economic tariffs on almost all countries.

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Speaker 8: Whereas the plaintiffs in this case say that Congress has

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Speaker 8: that power and cannot delegate that power, and that AIPA,

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Speaker 8: which has never before been used to impose tariffs, does

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Speaker 8: not include that power and authority. So that is what

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Speaker 8: is at stake. And of course the tariffs under AEPA

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Speaker 8: have led to collection of hundreds of billions of dollars

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Speaker 8: of tariffs already, so it's very high economic stakes for

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Speaker 8: the companies and industries that have paid those tariffs as well.

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Speaker 2: Let's talk about some of the analysis during the oral arguments,

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Speaker 2: and you know, there's always a textual analysis these days,

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Speaker 2: and some of the justice's concerns that the text of

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Speaker 2: the statute doesn't mention the word tariffs at all exactly.

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Speaker 8: The argument focused quite heavily on this law used by

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Speaker 8: President Trump AEPA and whether that law, which gives the

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Speaker 8: president the power to regulate imports, also includes the power

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Speaker 8: to impose tariffs. That really dominated most of the hearing,

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Speaker 8: and the justices asked very difficult questions on both sides.

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Speaker 8: The administration said and the Solicitor General and the argument

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Speaker 8: said that the ability to impose tariffs is a core

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Speaker 8: application of the ability to regulate imports in a historical context,

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Speaker 8: said that, of course, the power to regulate imports would

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Speaker 8: be read to include tariffs because tariffs have been used

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Speaker 8: throughout our country's history. On the other hand, several justices

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Speaker 8: were skeptical of that, and the plaintiffs in this case

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Speaker 8: said that when the delegation includes tariff authority, there is

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Speaker 8: always specific language to that effect, and that there are

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Speaker 8: always conditions and tests and agency decisions that have to

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Speaker 8: go into that tariff power. So there was a good

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Speaker 8: amount of the argument focused on those issues, and again,

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Speaker 8: whether the power to regulate imports includes the power to

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Speaker 8: impose tariffs, And.

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Speaker 2: What did you think of a Solicitor General arguing that

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Speaker 2: the Trading with the Enemy Act of nineteen seventeen gives

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Speaker 2: the president authority and also to a nineteen seventy six

437
00:26:01,800 --> 00:26:06,840
Speaker 2: tariff by President Richard Nixon that the Supreme Court upheld.

438
00:26:08,119 --> 00:26:12,200
Speaker 8: Well, I think both sides had responses there. So the

439
00:26:12,320 --> 00:26:15,800
Speaker 8: Solicitor General argued, yes, that the Trading with the Enemy

440
00:26:15,840 --> 00:26:21,160
Speaker 8: Act was used to impose tariffs in a prior situation

441
00:26:21,280 --> 00:26:24,679
Speaker 8: by President Nixon, and that there's no reason to think

442
00:26:25,080 --> 00:26:28,480
Speaker 8: that anything had changed when AEPA had passed. On the

443
00:26:28,480 --> 00:26:31,960
Speaker 8: other hand, I think the plaintiffs had a response to

444
00:26:32,000 --> 00:26:36,840
Speaker 8: that in terms of the fact again that when tariffs

445
00:26:36,840 --> 00:26:40,080
Speaker 8: are involved, there are always conditions on their use, there

446
00:26:40,080 --> 00:26:44,240
Speaker 8: are always specific procedures, and also the fact that the

447
00:26:44,320 --> 00:26:48,600
Speaker 8: reality is that no other president in fifty years has

448
00:26:48,760 --> 00:26:53,520
Speaker 8: used AIPA to impose tariffs. So a lot of discussion

449
00:26:53,560 --> 00:26:57,440
Speaker 8: on that, I think, tough questions from many of the justices,

450
00:26:58,200 --> 00:27:00,960
Speaker 8: and that is one of the shoes that's joined and

451
00:27:01,000 --> 00:27:01,920
Speaker 8: will have to be decided.

452
00:27:02,200 --> 00:27:06,920
Speaker 2: What role does the Major Questions doctrine play here? It's

453
00:27:07,200 --> 00:27:10,840
Speaker 2: was mentioned several times, and the Chief Justice seemed to

454
00:27:10,880 --> 00:27:14,960
Speaker 2: think it was important Justice score such at one point

455
00:27:15,040 --> 00:27:18,400
Speaker 2: said to Neil Katyal, I think you're going to need

456
00:27:18,520 --> 00:27:20,240
Speaker 2: the Major Questions doctrine.

457
00:27:21,040 --> 00:27:24,600
Speaker 8: Yes. So the question here is does the Major Questions

458
00:27:24,640 --> 00:27:28,920
Speaker 8: Doctrine require a clear statement in AIPA that it includes

459
00:27:29,000 --> 00:27:34,359
Speaker 8: the power to impose tariffs? And this Court has not

460
00:27:34,520 --> 00:27:40,080
Speaker 8: hesitated to start using that doctrine more broadly, but I

461
00:27:40,119 --> 00:27:44,560
Speaker 8: think you're right that the justices had some concerns about

462
00:27:44,600 --> 00:27:49,359
Speaker 8: pursuing it in this venue. And again the question comes

463
00:27:49,400 --> 00:27:54,000
Speaker 8: to is the power to tariff implied in the power

464
00:27:54,040 --> 00:27:57,919
Speaker 8: to regulate imports or if it's not. Was this a

465
00:27:58,000 --> 00:28:03,280
Speaker 8: question that Congress was required to state clearly that tariffs

466
00:28:03,320 --> 00:28:07,359
Speaker 8: were a part of what was envisioned by the new law.

467
00:28:08,000 --> 00:28:12,040
Speaker 2: Do you think that how the conservative justices used the

468
00:28:12,160 --> 00:28:16,720
Speaker 2: Major Questions doctrine to stop several of Biden's initiatives? Do

469
00:28:16,800 --> 00:28:20,159
Speaker 2: you think that that is something that they'll have to

470
00:28:20,280 --> 00:28:24,240
Speaker 2: explain if they allow Trump's tariffs to go through.

471
00:28:25,160 --> 00:28:27,640
Speaker 8: I think it's an interesting question whether they'll go there,

472
00:28:27,760 --> 00:28:30,080
Speaker 8: or whether they will just focus on the language of

473
00:28:30,080 --> 00:28:33,120
Speaker 8: AIBA and this issue of whether the power to regulate

474
00:28:33,200 --> 00:28:37,280
Speaker 8: imports includes the power of tariff and I think several

475
00:28:37,760 --> 00:28:40,960
Speaker 8: justices went down that road. I don't think just because

476
00:28:41,360 --> 00:28:44,000
Speaker 8: these doctrines have been used in other cases, such as

477
00:28:44,000 --> 00:28:47,720
Speaker 8: the Biden student bound forgiveness case, doesn't necessarily mean that

478
00:28:47,760 --> 00:28:50,880
Speaker 8: they will have to address it in this opinion if

479
00:28:50,880 --> 00:28:54,200
Speaker 8: they have other bases for finding that the tariffs were

480
00:28:54,680 --> 00:28:57,680
Speaker 8: legal or improper in any way.

481
00:28:57,920 --> 00:29:01,240
Speaker 2: What was your take on Justice Core, such as questioning

482
00:29:01,360 --> 00:29:06,160
Speaker 2: of the Solicitor General early in the arguments where he

483
00:29:06,280 --> 00:29:12,719
Speaker 2: expressed concerns about the extent of presidential power that Trump

484
00:29:12,800 --> 00:29:14,880
Speaker 2: is claiming and where it could lead.

485
00:29:16,240 --> 00:29:19,160
Speaker 8: Yes, I thought that was very interesting. Justice cours such

486
00:29:19,200 --> 00:29:22,600
Speaker 8: as you mentioned, ask the hypothetical of if Congress can

487
00:29:22,640 --> 00:29:27,880
Speaker 8: delegate the tariff authority, what would prohibit Congress from delegating everything,

488
00:29:28,040 --> 00:29:31,600
Speaker 8: including the power to declare war, which is clearly given

489
00:29:31,600 --> 00:29:37,240
Speaker 8: in the Constitution to Congress and Justice. Corsich also called

490
00:29:37,640 --> 00:29:41,200
Speaker 8: the government's reading of its tariff power as a one

491
00:29:41,240 --> 00:29:45,120
Speaker 8: way ratchet and an accretion of power to the president,

492
00:29:45,760 --> 00:29:50,840
Speaker 8: and one that Congress could not recover. Without a supermajority

493
00:29:51,040 --> 00:29:53,800
Speaker 8: or a veto proof majority, and so that was a

494
00:29:53,920 --> 00:29:59,200
Speaker 8: very interesting discussion. I'm certainly raising some concerns about the limits,

495
00:29:59,440 --> 00:30:03,560
Speaker 8: if any, on the authority that the government was claiming.

496
00:30:03,840 --> 00:30:07,400
Speaker 2: And where does the non delegation doctrine that Gorsuch was

497
00:30:07,480 --> 00:30:08,520
Speaker 2: talking about fit in.

498
00:30:09,040 --> 00:30:12,959
Speaker 8: Well, again, Congress, under the non delegation doctrine, Congress cannot

499
00:30:13,000 --> 00:30:19,080
Speaker 8: transfer to another branch hours that are strictly and exclusively legislative.

500
00:30:19,680 --> 00:30:24,920
Speaker 8: But it may confer substantial discretion on executive agencies to

501
00:30:25,160 --> 00:30:29,480
Speaker 8: implement and enforce the laws. So that's the doctrine in general,

502
00:30:30,200 --> 00:30:33,840
Speaker 8: and the courts have interpreted that to say that a

503
00:30:33,920 --> 00:30:39,680
Speaker 8: delegation of this discretion is constitutional as long as Congress

504
00:30:39,760 --> 00:30:45,520
Speaker 8: lays down an intelligible principle to which the person or

505
00:30:45,560 --> 00:30:50,000
Speaker 8: the agency is directed to conform. And that intelligible principle

506
00:30:50,040 --> 00:30:53,800
Speaker 8: standard is a fairly low bar to clear. It's only

507
00:30:53,880 --> 00:30:58,120
Speaker 8: been found lacking in a couple of statutes. So I

508
00:30:58,200 --> 00:31:01,640
Speaker 8: don't think non delegation plays as much of a role

509
00:31:02,200 --> 00:31:05,320
Speaker 8: as the major questions doctrine, at least from how the argument,

510
00:31:05,440 --> 00:31:06,760
Speaker 8: the oral argument played out.

511
00:31:07,160 --> 00:31:09,360
Speaker 2: You know, it just seemed to me as if the

512
00:31:09,400 --> 00:31:13,600
Speaker 2: Trump administration is having to bend over backwards and torture

513
00:31:14,000 --> 00:31:17,719
Speaker 2: the language to try to get to the result that

514
00:31:17,760 --> 00:31:22,160
Speaker 2: they want, whereas a plane reading wouldn't include tariffs.

515
00:31:22,760 --> 00:31:25,040
Speaker 8: Well, I think that really is the key issue. Again,

516
00:31:25,120 --> 00:31:28,640
Speaker 8: the Solicitor General said, of course it would be understood,

517
00:31:28,720 --> 00:31:34,720
Speaker 8: and implied that the power to regulate imports includes the

518
00:31:34,760 --> 00:31:41,720
Speaker 8: power to impose tariffs, and in fact, adjusting imports is

519
00:31:42,040 --> 00:31:45,600
Speaker 8: another definition of regulating, and also the fact that since

520
00:31:45,640 --> 00:31:50,080
Speaker 8: the founding, historically tariffs have been a primary way to

521
00:31:50,160 --> 00:31:54,520
Speaker 8: regulate imports. So the Solicitor General was arguing it was

522
00:31:54,520 --> 00:31:58,240
Speaker 8: a natural reading of the law, But the justices were

523
00:31:58,520 --> 00:32:02,440
Speaker 8: skeptical and asked tough questions and noted that in every

524
00:32:02,440 --> 00:32:05,560
Speaker 8: other law where tariffs are involved, the power is made

525
00:32:05,640 --> 00:32:08,000
Speaker 8: very explicitly clear and it comes with conditions.

526
00:32:08,640 --> 00:32:10,760
Speaker 2: Where do you think the justices are going to come

527
00:32:10,800 --> 00:32:11,680
Speaker 2: out here.

528
00:32:12,800 --> 00:32:16,080
Speaker 8: Well, I'm not in the business of making predictions. Generally,

529
00:32:16,520 --> 00:32:19,000
Speaker 8: I think my own personal view is that the court's

530
00:32:19,000 --> 00:32:22,800
Speaker 8: three Democratic justices probably vote against these tariffs. And then

531
00:32:22,840 --> 00:32:25,600
Speaker 8: the question is whether some of the majority of the

532
00:32:25,600 --> 00:32:29,480
Speaker 8: court have similar concerns about the president's use of this law.

533
00:32:30,120 --> 00:32:33,800
Speaker 8: And I do think that it's still a very close decision.

534
00:32:34,040 --> 00:32:37,720
Speaker 8: It could go either way based on the questioning. My

535
00:32:37,800 --> 00:32:41,520
Speaker 8: own view, I thought Chief Justice Roberts and Justice Barrett

536
00:32:41,680 --> 00:32:46,280
Speaker 8: and Justice Gorsich were perhaps more skeptical of the president's

537
00:32:46,280 --> 00:32:51,200
Speaker 8: tariff authority under a than the other justices. But again,

538
00:32:51,280 --> 00:32:53,719
Speaker 8: that was just the oral argument. We don't really know

539
00:32:53,760 --> 00:32:56,000
Speaker 8: how it will come out. I guess the only other

540
00:32:56,040 --> 00:33:00,120
Speaker 8: point I would make is, although it was discussed the

541
00:33:00,240 --> 00:33:03,440
Speaker 8: oral argument, I have a hard time seeing this court

542
00:33:03,520 --> 00:33:07,240
Speaker 8: making a split decision that some of President Trump's tariffs

543
00:33:07,240 --> 00:33:10,200
Speaker 8: are acceptable but others are not. I mean, I suspect

544
00:33:10,200 --> 00:33:12,280
Speaker 8: the courts would prefer not to be in the business

545
00:33:12,280 --> 00:33:15,120
Speaker 8: of making those judgment calls going forward. So I could

546
00:33:15,160 --> 00:33:19,040
Speaker 8: be wrong, but I think the Court will either decide yes,

547
00:33:19,240 --> 00:33:22,120
Speaker 8: the power to regulate imports includes the power to tariff,

548
00:33:22,600 --> 00:33:24,560
Speaker 8: or no it does not, rather than some sort of

549
00:33:24,600 --> 00:33:28,800
Speaker 8: split decision on the fentanyl tariffs versus the reciprocal tariffs.

550
00:33:29,040 --> 00:33:33,320
Speaker 2: So if the court rules against Trump, what happens next,

551
00:33:33,360 --> 00:33:35,360
Speaker 2: I mean, what happens to his tariffs?

552
00:33:35,760 --> 00:33:38,280
Speaker 8: Well, two things would happen. First of all, there would

553
00:33:38,320 --> 00:33:41,840
Speaker 8: likely be some sort of a refund process for importers

554
00:33:41,880 --> 00:33:44,600
Speaker 8: that paid the tariffs during this time, and there is

555
00:33:44,640 --> 00:33:47,720
Speaker 8: some precedent for that before that was discussed during the

556
00:33:47,840 --> 00:33:50,960
Speaker 8: oral argument a situation where the court struck down a

557
00:33:51,040 --> 00:33:54,760
Speaker 8: harbor maintenance tax and there was basically a process where

558
00:33:55,080 --> 00:33:58,320
Speaker 8: companies could file claims for the amount of the tax

559
00:33:58,360 --> 00:34:02,000
Speaker 8: that they paid. So Barretts was concerned that this could

560
00:34:02,000 --> 00:34:04,520
Speaker 8: be a mess and could be very unwieldy, and so

561
00:34:04,560 --> 00:34:06,840
Speaker 8: there were some questions on that point. I guess the

562
00:34:07,400 --> 00:34:10,360
Speaker 8: more important point is what will the president do going forward?

563
00:34:10,800 --> 00:34:13,920
Speaker 8: And I think it's clear that tariffs are still a

564
00:34:14,000 --> 00:34:18,640
Speaker 8: cornerstone of this administration's economic policy, and if the Court

565
00:34:18,760 --> 00:34:23,960
Speaker 8: says that the President cannot use AIPA, the president will

566
00:34:24,040 --> 00:34:28,040
Speaker 8: likely pivot to one of several other trade tools that

567
00:34:28,160 --> 00:34:32,280
Speaker 8: are available, and the Court mentioned many of these, including

568
00:34:32,360 --> 00:34:35,640
Speaker 8: Section one twenty two, the section two thirty two, the

569
00:34:35,719 --> 00:34:39,439
Speaker 8: National Security Law, which the administration has already made quite

570
00:34:39,480 --> 00:34:42,799
Speaker 8: a bit of use of in this administration, Section three

571
00:34:42,920 --> 00:34:46,080
Speaker 8: zero one, and so forth. The limit on those laws

572
00:34:46,160 --> 00:34:50,600
Speaker 8: is that they do require studies or actions by other agencies.

573
00:34:50,680 --> 00:34:53,560
Speaker 8: So Section two thirty two requires a study and a

574
00:34:53,600 --> 00:34:57,719
Speaker 8: report by the Commerce Department and consultation with Defense Department.

575
00:34:58,120 --> 00:35:02,600
Speaker 8: In order to decide that imports of a certain product

576
00:35:02,880 --> 00:35:09,440
Speaker 8: like semiconductors or pharmaceuticals are a threat to national security. Similarly,

577
00:35:09,800 --> 00:35:13,120
Speaker 8: Section three ZHO one, which was the law used to

578
00:35:13,200 --> 00:35:17,839
Speaker 8: impose tariffs on China during the first Trump administration, also

579
00:35:18,000 --> 00:35:22,520
Speaker 8: requires a detailed study by the US Trade representative with

580
00:35:22,640 --> 00:35:26,440
Speaker 8: public inputs. So those tools, for the most part, cannot

581
00:35:26,480 --> 00:35:30,239
Speaker 8: be used as quickly as AEPA was used by President.

582
00:35:29,920 --> 00:35:32,840
Speaker 2: Trump or anything that was striking to you in the

583
00:35:33,080 --> 00:35:34,560
Speaker 2: oral arguments.

584
00:35:34,880 --> 00:35:38,200
Speaker 8: I thought it was interesting when Chief Justice Roberts said

585
00:35:38,560 --> 00:35:41,799
Speaker 8: that it seemed to him that using this law to

586
00:35:41,920 --> 00:35:46,200
Speaker 8: have the president's foreign affairs power trump the legislative power

587
00:35:46,239 --> 00:35:50,799
Speaker 8: to regulate trade seems to neutralize Congress's power. So I

588
00:35:50,800 --> 00:35:54,319
Speaker 8: thought that was notable. Justice Barrett asked whether there was

589
00:35:54,360 --> 00:35:57,280
Speaker 8: any other time in history with a phrase regulate imports

590
00:35:57,400 --> 00:36:01,279
Speaker 8: was read to include the imposition of tear riffs, and

591
00:36:01,760 --> 00:36:04,719
Speaker 8: she seemed not entirely convinced by the response from the

592
00:36:04,760 --> 00:36:09,960
Speaker 8: Solicitor General, and then Justice Kavanaugh asked, you know, the

593
00:36:10,120 --> 00:36:13,720
Speaker 8: historical perspective was the tariff power the kind of power

594
00:36:14,200 --> 00:36:19,000
Speaker 8: understood by Congress to exist when the AEPA law was passed,

595
00:36:19,520 --> 00:36:22,879
Speaker 8: and he also did ask why in prior economic emergencies

596
00:36:22,920 --> 00:36:26,000
Speaker 8: have other presidents not used IP but to invoke tariffs.

597
00:36:26,080 --> 00:36:31,040
Speaker 8: So again, very tough questions on all sides, and still

598
00:36:31,160 --> 00:36:34,120
Speaker 8: a very close case as to how this will ultimately

599
00:36:34,120 --> 00:36:34,440
Speaker 8: come out.

600
00:36:34,840 --> 00:36:38,320
Speaker 2: Thanks so much for joining me, Jim. That's Timothy Brightbill

601
00:36:38,480 --> 00:36:41,840
Speaker 2: of Wilie Rhine, and that's it for this edition of

602
00:36:41,840 --> 00:36:44,520
Speaker 2: The Bloomberg Law Show. Remember you can always get the

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Speaker 2: latest legal news on our Bloomberg Law Podcast. You can

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Speaker 2: tune into The Bloomberg Law Show every weeknight at ten

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