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Speaker 2: This is a breaking news update from Bloomberg instant reaction
Speaker 2: and analysis from our three thousand journalists and analysts around
Speaker 2: the world.
Speaker 3: US Supreme Court struck down President Donald Trump sweeping global tariffs,
Speaker 3: undercutting his signature economic policy and delivering his biggest legal
Speaker 3: defeat since he returned to the White House. Tyler Kendall,
Speaker 3: Bloomberg News White House correspondent joins his hair Washington correspondent.
Speaker 3: Tyler give us the latest on what we know about
Speaker 3: this Supreme Court ruling.
Speaker 4: So it appears that the Court, in a six to
Speaker 4: three decision struck down President Trump's tariffs, those broad based
Speaker 4: ones that have to do with IIPA, the International Emergency
Speaker 4: Economic Powers Act. President put forward IIPA tariffs on two accounts.
Speaker 4: One was those ventanyl related tariffs related to Canada, Mexico,
Speaker 4: and in part on China. And then the other were
Speaker 4: the more broad based ones where he cited persistent trade imbalances.
Speaker 4: Now we're still going through this cases coming in in
Speaker 4: real time right now to figure out the two questions
Speaker 4: that were in front of the court. One was does
Speaker 4: President Trump actually have the authority to invoke AIPA to
Speaker 4: impose tariffs, because this has never been done before. This
Speaker 4: is typically a federal authority that is used to invoke sanctions.
Speaker 4: So the question here is whether or not he circumvented Congress.
Speaker 4: The other question was about whether or not he actually
Speaker 4: invoked AIPA correctly if he's able to by declaring these
Speaker 4: national emergencies, did those national emergencies related to betanal related
Speaker 4: to these trade imbalances reached a legal standard of what
Speaker 4: is known as an unusual and extraordinary threat, that the
Speaker 4: president would have this authority to impose a tariff a
Speaker 4: regulation of commerce in this way to achieve his objection,
Speaker 4: his objectives. We're still reading through this, but it appears
Speaker 4: that we have one at least dissenting opinion was from Cavanaugh,
Speaker 4: of course, a Justice Brett Kavanaugh, who was appointed under
Speaker 4: nominated under President Trump, who says, quote, the court says
Speaker 4: nothing today about whether and if so, how the government
Speaker 4: should go about returning the billions of dollars that it
Speaker 4: has collected from importers. But that process is likely to
Speaker 4: be a mess, as was acknowledged at oral arguments. So
Speaker 4: that's going to be the entire next phase of this.
Speaker 5: It doesn't seem to matter to investors, at least for
Speaker 5: the moment. You look at the S and P five hundred.
Speaker 5: It did shoot up, it's come back a little bit.
Speaker 5: But what's notable here, Paul, is that the best performing
Speaker 5: group among twenty four groups is a consumer durable and
Speaker 5: apparel's group, lul Lemon, for instance, jumping about five percent
Speaker 5: right at the open. It's pared some of that advance
Speaker 5: to two point four percent. Lululemon, along with other companies
Speaker 5: presumably hurt by this by these tariffs, would benefit therefore
Speaker 5: with the removal of these tariffs, although as Tyler made clear,
Speaker 5: it's not clear whether there would be a refund or
Speaker 5: how that would even be put together.
Speaker 3: Yeah, and I'm just kind of reading some of the
Speaker 3: Bloomberg headlines. Supreme Court does not address eligibility for tariff refunds,
Speaker 3: and Bloomberg new is also reporting that hundreds of teriff
Speaker 3: refund lawsuits pending in US Trade Court. So Tyler, this
Speaker 3: seems like that's where the rubber meets the road. To
Speaker 3: the extent that anybody's going to try to get a
Speaker 3: tariff relief or tariff refunds, it's not going to be
Speaker 3: easy at least at this stage.
Speaker 4: Well, if you want to hear a pretty startling statistic,
Speaker 4: AIPA terraffs have been collected for more than three hundred
Speaker 4: and one thousand importers, and every company that wants a
Speaker 4: refund would need a distinct claim in court. Perhaps we'll
Speaker 4: likely see a class action lawsuit that could maybe put
Speaker 4: this a little bit more broad based. But when we're
Speaker 4: looking at just a massive amount of revenue that was
Speaker 4: raised by these IEPA tariffs alone. Of course, the Trump
Speaker 4: administration has other tariff authorities that are already in place
Speaker 4: Section two thirty two related to national security, for example,
Speaker 4: those AIPA broad based tariffs brought in last year more
Speaker 4: than one hundred and thirty four billion dollars for the
Speaker 4: US government. So it's going to be a complicated process.
Speaker 4: It likely would leave the question of refunds to a
Speaker 4: lower court, most likely the Court of International Trade, which
Speaker 4: first took up this case. There's a few different wonky
Speaker 4: points that I had written down here on how this
Speaker 4: could ultimately end up happening. One thing to know is
Speaker 4: that there's something known as the liquidation process, which basically
Speaker 4: is the statue of limitation that a company can ask
Speaker 4: for its money back. That's three hundred and fourteen days.
Speaker 4: So some of those tariffs imposed on China have actually
Speaker 4: been imposed longer than that, so those companies wantn't get
Speaker 4: those back. But by and large, I think we're still
Speaker 4: within that timeframe for these companies to ask for those requests.
Speaker 5: And just the quick mention equities building on their advance
Speaker 5: a little bit. With the SMP five hundred now up
Speaker 5: a third of one percent, Treasury yields are higher, and
Speaker 5: the thinking is that the removal of tariffs would leave
Speaker 5: a budget hole that we know already surprise the hundred
Speaker 5: thirty billion dollars as of December. Treasury would need to
Speaker 5: sell a lot more bonds to bridge the gap, and
Speaker 5: that would put some pressure on yields upward pressure and
Speaker 5: of course if there are reefusts as part of it,
Speaker 5: that would only make the situation worse. It would exacerbate
Speaker 5: these moves.
Speaker 3: So I guess, Tyler, there's still opportunities. There are still
Speaker 3: tools that the president can use to apply some tariffs,
Speaker 3: even if this IEPA sweeping one is no longer on.
Speaker 4: The table, right and we've already heard telegraphed from the
Speaker 4: administration that they're going to pull on these other federal authorities,
Speaker 4: some of them are already in place. We talk a
Speaker 4: lot about Section two thirty two, those National security tariffs
Speaker 4: that the administration has put forward on some of those
Speaker 4: critical sectors steel, aluminum, of critical minerals, and a lot
Speaker 4: of those other areas that have been a focus of
Speaker 4: the Trump administration. When it comes to countering China. We
Speaker 4: could also see Section three oh one investigations that's over
Speaker 4: unfair trade practices. We saw a lot of those imposed
Speaker 4: on China under the first Trump administration. Think allegations of
Speaker 4: IP protection violations as one example. And then there's some
Speaker 4: lesser known ones like Section three point thirty eight that
Speaker 4: hasn't been used since the nineteen forties. I also have
Speaker 4: Section two on one here tariffs imposed on goods that
Speaker 4: cause injury to domestic industry. There's a lot, But basically
Speaker 4: the crux to think of this is that the Trump
Speaker 4: administration likes IEPA because that's a lot more flexible, it's
Speaker 4: a lot more broad based. A lot of these tariffs
Speaker 4: have limits. They have to go away after a certain
Speaker 4: amount of time, and the rates can't go that high.
Speaker 4: A lot of these tariffs have a fifteen percent sealing
Speaker 4: for example, whereas we know the president in some cases
Speaker 4: has threaten tariffs you know, fifty percent and onwards.
Speaker 5: And also all the different sections that you cited. Most
Speaker 5: of these tariffs can't be imposed instantly. There's a bit
Speaker 5: of waiting time, and we know the president wants to
Speaker 5: declare something and have it kind of be in effect
Speaker 5: almost immediately, and the IEPA tariffs allowed him that flexibility.
Speaker 4: As you put it, exactly, a Section two thirty two
Speaker 4: investigation on average nine months to complete. We have seen
Speaker 4: this administration in some cases do this under a more
Speaker 4: expedited timeline because they actually pulled on investigations that were
Speaker 4: launched under the first Trump administration, so they were able
Speaker 4: to make the legal argument that they already had such
Speaker 4: a bolstering of the information behind them that they could
Speaker 4: make the determination that this meets the national security concerns
Speaker 4: or the unfair trade allegations to put on their terrafts.
Speaker 4: But to your point exactly, Scarlett, this definitely limits the
Speaker 4: flexibility of the administration.
Speaker 6: Tyler, thank you so much.
Speaker 5: And it's just our luck that Tyler Kendall happened to
Speaker 5: be a new.
Speaker 6: Clearly, she was not anticipating this.
Speaker 5: I mean, we knew that this decision was coming along
Speaker 5: at some point, but the Supreme Court had passed up
Speaker 5: the previous two or three instances could have come out
Speaker 5: with this decision. Tyler Kendall, Bloomberg's Washington correspondent, on our
Speaker 5: way back to DC this afternoon.
Speaker 6: Thank you so much. Thank you.
Speaker 3: All right, let's go to Judie Grossel right now, Bloomberg
Speaker 3: Walls host. She joins us here in studio June. I
Speaker 3: guess this was expected from somewhat expected from a legal perspective.
Speaker 6: Does the six to three.
Speaker 3: Vote, does that mean anything one way or the other,
Speaker 3: as opposed to maybe have a unanimous nine zero.
Speaker 7: Well, I mean, I guess.
Speaker 8: It would be preferable for the people in the majority,
Speaker 8: for the justices and the majority to say, you know,
Speaker 8: this was a unanimous vote, but otherwise, you know, it
Speaker 8: doesn't really matter. It's sixty three with the very conservative justices.
Speaker 6: In the minority. I mean, this was expected.
Speaker 8: After the Supreme Court oral arguments, it seemed as if
Speaker 8: this was the definite conclusion, and so people were wondering,
Speaker 8: what was taking so long?
Speaker 6: Well, what's taking so long?
Speaker 8: As it's one hundred and seventy pages, so it's kind
Speaker 8: of difficult to get through and to figure out exactly
Speaker 8: what happened.
Speaker 6: But what happened during the oral arguments was that you.
Speaker 8: Have this statute, AEPA that no other president has used
Speaker 8: to impose tariffs. And under this statute there's a word
Speaker 8: call regulate. So how do you interpret regulate? Does that
Speaker 8: mean you can impose tariffs or not? And you know,
Speaker 8: a lot of the justices, particularly the liberal Justice, is
Speaker 8: harped on the language of the statute.
Speaker 6: What does it mean?
Speaker 8: I mean, this is a court that's originalist, and they're
Speaker 8: trying to interpret all the time with the words of
Speaker 8: a statute or the words of a constitution means. So
Speaker 8: they were looking at this and saying, you know, where
Speaker 8: do you get the authority in this statute to impose tariffs?
Speaker 6: And it was pretty.
Speaker 8: Obvious during their oral arguments that there were enough votes,
Speaker 8: particularly the Chief Justice. And the Chief Justice wrote this opinion.
Speaker 8: And I'll just note that when I predicted that, because
Speaker 8: whenever there's a big opinion that he's in in the center,
Speaker 8: he writes it. He wrote the you know, the Supreme
Speaker 8: Court opinion giving President Trump limited presidential authority to be
Speaker 8: let's say to be I'm trying to think of the
Speaker 8: right word. Not to be prosecuted for ax committed criminal
Speaker 8: acts committed in office.
Speaker 6: He wrote that one.
Speaker 8: He's written like all the very very big opinions. So
Speaker 8: when we heard what he said in the oral arguments,
Speaker 8: it was pretty obvious what was going to happen. And
Speaker 8: it's just a question of why it took so long.
Speaker 8: And I think Justice Jackson had said last week that
Speaker 8: in an interview that there are nuances to this so
Speaker 8: and we won't be able to see the nuances until.
Speaker 6: We get through some of this. Yes, pages one hundred
Speaker 6: and seventy pages.
Speaker 8: It's I mean, there are concurrences and partial concurrences. It's
Speaker 8: it's really it's messy. I'd say it's messy.
Speaker 5: And that's exactly how Brett Kavanaugh, the one of the
Speaker 5: dissenting justices, described the refund process. It was likely to
Speaker 5: be a mess, as was acknowledged at oral argument. Is
Speaker 5: it surprising then that the justices did not address the
Speaker 5: extent to which importers are entitled to refunds That it's
Speaker 5: just basically it back to the lower courts.
Speaker 8: Well, I think what the justices try to do is
Speaker 8: write as narrow an opinion as they possibly can. So
Speaker 8: why get into an area they really don't have to
Speaker 8: get into. And as you say, there's a lot of
Speaker 8: you know, it's going to be messy. And so I
Speaker 8: think that that's the way this court operates. They don't
Speaker 8: want to rule on something that they don't have to
Speaker 8: rule on. And here they did a ruling on tariffs.
Speaker 8: You know, a week before the President is going to
Speaker 8: make his State of the Union address. That's why I
Speaker 8: didn't think it was going to come down today. We
Speaker 8: were talking about in the newsroom and like, why would
Speaker 8: they do that? And then they're going to sit there.
Speaker 8: Is he going to say something about it? He probably
Speaker 8: will say something about it while they're sitting there. A
Speaker 8: lot of them will be sitting there. The Chief always goes,
Speaker 8: so they'll be.
Speaker 6: At the State of the Union.
Speaker 8: The Chief always goes, Elena Kagan goes usually sort of
Speaker 8: mayor goes. Alito hasn't gone since Barack Obama said something
Speaker 8: about Citizens United and Alito was shaking his head back
Speaker 8: and forth.
Speaker 6: So he hasn't been there. But maybe he'll be there
Speaker 6: for this. I don't know. So and Justice cours.
Speaker 8: It has gone Justice Kavanaugh, Amy Coney, Barrett, so a
Speaker 8: lot of them do go. So it'll be interesting to
Speaker 8: watch and to see whether any statements are made from
Speaker 8: the President about that and whether there's any shaking of heads.
Speaker 6: So I was wrong about that, and I admit it.
Speaker 8: So this came as a surprise this morning, even though
Speaker 8: the decision itself what they did didn't come as a surprise.
Speaker 9: Yeah.
Speaker 5: If anything, this makes the State of the Union address
Speaker 5: that much more interesting to see how it all shakes
Speaker 5: out the body language, not just what President Trump will say,
Speaker 5: because I'm sure he'll probably say something even before his
Speaker 5: address next week.
Speaker 6: Yep.
Speaker 3: Absolutely, we'll certainly given this.
Speaker 5: This the signature economic policy that he has really defined
Speaker 5: his administration.
Speaker 8: He's been talking about how the Supreme Court, I mean
Speaker 8: several times he said the Supreme Court has to rule
Speaker 8: in the right way on this. So and he's always
Speaker 8: bit well because they've been ruling so much in his
Speaker 8: favor on the emergency ducket. He's been very complimentary about
Speaker 8: the Court. But we'll see what happens.
Speaker 4: II.
Speaker 6: Dad, that's going to last all right.
Speaker 3: We'll stay on top of the President's social media output
Speaker 3: here today, jun Grassa, thank you so much. We appreciated
Speaker 3: Jean Grasso, a Bloomberg Law host, here, joining us here
Speaker 3: for this momentous decision. Here, the US Supreme Court struck
Speaker 3: down President Donald Trump's sweeping global tarrits, undercutting his significant
Speaker 3: economic policy and delivering his biggest legal defeat since he
Speaker 3: returned to the White House. That is, according to Bloomberg
Speaker 3: reporting Scarla Fu and Paul Swooney live here in our
Speaker 3: Bloomberg Interactive Broker studio. I'm looking at the top live again.
Speaker 3: Great great reporting, real time on this breaking story. Sean
Speaker 3: don and senior economics writer. He writes, it's not overstating
Speaker 3: things to say this is a historic decision that applies
Speaker 3: on at least two fronts. Number One, the policy at issue,
Speaker 3: Trump's increase in tarists last year was the largest. It's
Speaker 3: the infamous nineteen thirty Smoot Hawley duties. Number Two, it's
Speaker 3: application the presidential powers over the economy. Scholars and the
Speaker 3: lead up were calling this the biggest case inconomic policy
Speaker 3: realm since the Youngstown steelcase in nineteen fifty two, in
Speaker 3: which is the court block Harry Truman's been to nationalized
Speaker 3: steel mills during the Korean War. Others have liken the
Speaker 3: idea of Supreme Court rebrooking Trump on tariffs to the
Speaker 3: Court's fight with FDR over the New Deal, So.
Speaker 6: A lot of historical contexts.
Speaker 5: There are certainly a huge landmark decision by the Supreme
Speaker 5: Court determining that President Trump's global tariffs are illegal.
Speaker 6: Let's bring in Henrietta Trees.
Speaker 5: Henrietta is our go to expert on all things policy
Speaker 5: and economics. She is a managing partner and director of
Speaker 5: Economic Policy at Vetta Partners. Henrietta the market had largely
Speaker 5: anticipated this. We saw it with the reaction in certain
Speaker 5: retail stocks, companies that would benefit from the rollback of
Speaker 5: these tariffs.
Speaker 6: How are you looking at this?
Speaker 1: I agree, this is just a tremendous day, a huge
Speaker 1: win for the Constitution, for folks who cover tax policy,
Speaker 1: for anybody who remembers the Revolutionary War fought against specifically
Speaker 1: a taxation power that Congress did not have any say over.
Speaker 1: So this is, in my opinion, the largest and most
Speaker 1: impactful macroeconomic ruling the courts have ever delivered. So just
Speaker 1: a tremendous day. It is in line with what the
Speaker 1: market was expecting. You could see that investors were very
Speaker 1: prepared to rip the retail stocks. Everybody who's been exposed
Speaker 1: to the forty percent trans shipping tariffs, the ad hoc
Speaker 1: fifty percent tariffs on Brazil, the wide ranging threats of
Speaker 1: two hundred percent tariffs on French wine that have just
Speaker 1: been spewing out of the White House for twelve months now.
Speaker 1: So it's really an exhilarating day, an incredible day for
Speaker 1: the Constitution.
Speaker 3: In my opinion, Henriette, is this do you think in
Speaker 3: bolden any of President Trump's adversaries, whether in Congress or
Speaker 3: just within Washington d c. Apparatus, that maybe this gives
Speaker 3: them a little bit more confidence to push back. Is
Speaker 3: there any reason to believe that.
Speaker 1: Absolutely. I think there's two ways to look at this.
Speaker 1: First of all, this is such news for President Trump.
Speaker 1: Americans hate the tariffs. They know their taxes, they know
Speaker 1: that they're driving inflation, and they don't like them. So
Speaker 1: now that that authority has been stripped away from him,
Speaker 1: the president no longer has to collect these taxes.
Speaker 7: It's up to him to decide.
Speaker 1: Whether he wants to migrate into new and different authorities
Speaker 1: like Section one twenty two that give him the ability
Speaker 1: to impose tires at a fifteen percent rate for the
Speaker 1: next five months.
Speaker 7: If he wants to do that, he can go ahead on.
Speaker 1: But the American public will be very grateful that the
Speaker 1: Supreme Court struck these tires down, and even more grateful
Speaker 1: if he keeps them off.
Speaker 7: So that's one way of looking at it.
Speaker 1: And Republicans on Capitol Hail are staring down the barrel
Speaker 1: of a very ugly affordability narrative election cycle where we've
Speaker 1: seen races as diverse as Texas swing thirty one points
Speaker 1: away from President Trump just since he was elected.
Speaker 7: Those are tremendous.
Speaker 1: Losses for the Republican conference, and most of it is
Speaker 1: driven by the President's handling of the US economy. It's
Speaker 1: influenced not just the traditional pendant voter that we are
Speaker 1: always concerned with, but also with young male and Hispanic
Speaker 1: voters who have driven the President to his second term.
Speaker 7: So a lot to see here.
Speaker 5: A lot to see here. And it's not just American
Speaker 5: stocks that are benefiting. I'm looking at for instance, LVMH
Speaker 5: Hennessey in Europe climbing on the news, up four point
Speaker 5: four percent in European trading. So companies that rely on
Speaker 5: exports to the US also benefiting from this ruling. Paul
Speaker 5: asks a really important question Henrietta bas.
Speaker 6: It's very basic. Our temps rolled back starting today.
Speaker 7: They are legal so at border patrol.
Speaker 1: One of the things that's questionable here is that the
Speaker 1: White House has said all these trade deals are still.
Speaker 7: Going to be intact. You know, we've signed these agreements.
Speaker 7: That is null and void.
Speaker 1: Now if you are an importer and you are at
Speaker 1: Customs and Border Patrol, you no longer will suffer paying
Speaker 1: for these tariffs. And the Supreme Court has told Customs
Speaker 1: and Border Patrol they can no longer collect them. So
Speaker 1: this is a problem that the White House is going
Speaker 1: to have to address. They have a number of trade
Speaker 1: deals that they have signed. I believe there's about eight
Speaker 1: at this point, and many of them include a reciprocal
Speaker 1: tariff of ten percent in the case of the UK
Speaker 1: or nineteen percent in the case of Indonesia.
Speaker 7: Those tariffs are illegal.
Speaker 1: The Supreme Court has telled the Customs and Border Patrol
Speaker 1: people this.
Speaker 7: Authority is not permitted.
Speaker 1: So it's the importers who are going to rise up
Speaker 1: and say I'm not paying. It doesn't matter what the
Speaker 1: countries you know, independently decide or whatever the White House does.
Speaker 3: So what do we expect this administration? How do you
Speaker 3: expect the President and administration to respond here? Do you
Speaker 3: think they will aggressively try to work other tariff routes
Speaker 3: or maybe just let this issue die and just fade away.
Speaker 7: I appreciate the question, Paul. I am widely, wildly out
Speaker 7: of consensus on this.
Speaker 1: But what I just astrived on Section one twenty two
Speaker 1: is just one of the many alternates and alternatives that
Speaker 1: the president has Section three oh one, which is, you know,
Speaker 1: four hundred and fifty billion dollars worth of tires on China.
Speaker 7: We could re up that and apply it to the EU, the.
Speaker 1: UK, or Brazil. Well, all of those have been threatened.
Speaker 1: But think about what functionally that means. It means that
Speaker 1: individual businesses will have to go out again, get their
Speaker 1: trade lawyers on the payroll to comply with brand new,
Speaker 1: potentially even unused authorities that they'll have to comply with
Speaker 1: once again. Is it a fifteen percent tire freight under
Speaker 1: Section one twenty two?
Speaker 7: Does it exist?
Speaker 9: Now?
Speaker 7: When's the President going to put it on?
Speaker 1: What do I need to worry about with the national security, taft,
Speaker 1: the confusion, and the uncertainty, which were the buzzwords following
Speaker 1: Liberation Day in April, are going to come roaring back.
Speaker 1: In the event the President decides to migrate away from
Speaker 1: my EPA and move into new and different authorities. I
Speaker 1: think it would be extraordinarily disruptive. And again with my
Speaker 1: eye on the election cycle and then affordability narrative, the
Speaker 1: President I think is already on a very tight leash
Speaker 1: and he's not going to have the leeway to fully
Speaker 1: reimpose anywhere near the revenue that has been collected by
Speaker 1: eepas so far. So I don't think these TIFFs will
Speaker 1: ever come back at their current level, and I think
Speaker 1: will be much more restrained going forward.
Speaker 5: How does this all add up to what the President
Speaker 5: was planning to say in his State of the Union
Speaker 5: next week, because affordability was something that the White House
Speaker 5: has signaled it's really going to start focusing on, especially
Speaker 5: with the Metrum elections coming up. Now that the tariffs
Speaker 5: are ruled illegal by the Supreme Court, how does he
Speaker 5: fold that into his larger platform?
Speaker 1: Man, I mean, that is a pretzel of some logic
Speaker 1: they're going to have to work through here. Because, of course,
Speaker 1: the President has been saying that the tariffs have been
Speaker 1: a huge boon to the US economy. None of that
Speaker 1: is true. We just saw a very soft GDP print.
Speaker 1: We see that manufacturing jobs have lost seventy two thousand
Speaker 1: in the last year since Liberation Day. We see that
Speaker 1: prices have increased across a lot of the retail space.
Speaker 7: So that's what consumers are feeling.
Speaker 1: And you can't sell the American public on the idea
Speaker 1: that you're fixing our deficit problem when the deficit continues
Speaker 1: to rise and the trade and goods deficit continues to rise.
Speaker 1: So all of the arguments the White House has made
Speaker 1: are false, and now he's going to have to sell
Speaker 1: this to the American public. I suspect it'll be very
Speaker 1: uncomfortable for the front row of the House floor when
Speaker 1: he delivers the State of the Union on Tuesday. I
Speaker 1: will certainly be watching that. But they really stood up
Speaker 1: for the Constitution here and the President's message. If he
Speaker 1: wants to migrate to affordability, he can talk about other
Speaker 1: things like the housing agenda that they have. I mean,
Speaker 1: it's not realistic to think that a fifty year mortgage
Speaker 1: is coming, but those are the kinds of.
Speaker 7: Pieces that he should focus on.
Speaker 1: I imagine there will be quite a bit of grievance
Speaker 1: touted on the tirefront.
Speaker 8: Interesting.
Speaker 3: All right, Henrietta, thank you so much for joining us.
Speaker 3: We really appreciate getting a few minutes of your time
Speaker 3: and your expertise. Henrietta Trece's managing partner and director of
Speaker 3: economic policy at Veda Partners.
Speaker 5: We should note that the President has responded. According to
Speaker 5: Caitlin Collins of CNN, who tweeted out or posted on
Speaker 5: social media, President Trump commented on the Supreme Court ruling
Speaker 5: striking down his tariffs while inside the White House breakfast
Speaker 5: with governors this morning, calling it a quote disgrace. I'm
Speaker 5: told he told those gathered that he has a backup plan. Again.
Speaker 5: That is according to Caitlin Collins, reporter at CNN, the
Speaker 5: President calling the ruling against his tariffs a disgrace.
Speaker 3: Paul, Yeah, no surprise there, and we'll see. I guess
Speaker 3: we were talking to Henrietta trez what the response will
Speaker 3: be from President Trump, whether he will let this kind
Speaker 3: of fade away, or whether he who use some of
Speaker 3: the other options that he does.
Speaker 5: Have many, many different alternative options, including filing Recession two
Speaker 5: thirty two, two oh one, three oh one one two
Speaker 5: three thirty eight.
Speaker 6: Oh boy, yeah, there's a lot exactly.
Speaker 3: All right, we welcome back to our studios, June Grossos,
Speaker 3: Bloomberg's legal analyst here, June. Now you've had a couple
Speaker 3: more minutes to one hundred seventy page ruling.
Speaker 6: Any don't do that to me, Paul, don't do this
Speaker 6: to me.
Speaker 9: So, I mean, it's it is.
Speaker 3: I mean, we're just reading some of the reporting on
Speaker 3: the Bloomberg libe really calling in a historic ruling.
Speaker 6: It is historic.
Speaker 8: And also it's so important because you know, as we've
Speaker 8: discussed before, this Supreme Court has been a size for
Speaker 8: ruling for Trump on the emergency docket so many times,
Speaker 8: I mean a majority of the times, more than the.
Speaker 6: Majority, a vast majority of times.
Speaker 8: They're just a couple of cases where they didn't allow
Speaker 8: him to go forward with his agenda on the emergency dockets.
Speaker 8: So here you have this enormous case on his you know,
Speaker 8: sweeping global plans. And if the Supreme Court had not
Speaker 8: done this, if they had gone against the text of
Speaker 8: the statute and had ruled in his favor, think about
Speaker 8: what we'd be saying right now, this court is totally
Speaker 8: in Trump's pocket, would be one of the things that
Speaker 8: would be said. So it's so important on so many
Speaker 8: different levels, not only the level of what's going to
Speaker 8: happen now and that the tariffs have been declared illegal,
Speaker 8: but also for the integrity I think of the Supreme Court.
Speaker 8: It would have been shocking if they had ruled for
Speaker 8: the tariffs. So joining us now is Dave Townsend. He's
Speaker 8: a partner at Dorsey and Whitney, Trade attorney. David, Can
Speaker 8: you explain for us the basic premise of the Supreme
Speaker 8: Court's majority opinion?
Speaker 9: Sure, June, and it's great to be with you. Yeah.
Speaker 2: The basic premise of the opinion is that the IEPA Statute,
Speaker 2: which empowers the President to take action to regulate importation,
Speaker 2: doesn't extend to imposing tariffs, and so as a matter
Speaker 2: of statutory interpretation, the President exceeded the authority in issuing
Speaker 2: the global and fentanyl related tariffs.
Speaker 8: Is there anything and I know you haven't gotten through
Speaker 8: the whole opinion, but is there anything that surprised you
Speaker 8: about this opinion?
Speaker 2: One thing that did surprise me a bit, June about
Speaker 2: the opinion was how definitive it was with respect to
Speaker 2: the statutory interpretation question.
Speaker 9: The lower courts had been maybe a bit more measured.
Speaker 2: They had said that the use of the IPA authority
Speaker 2: had exceeded what I was intended to permit, and the
Speaker 2: Supreme Court, it looks to me what went one step
Speaker 2: further and said that the language of the statue doesn't
Speaker 2: permit tarif's full stop.
Speaker 3: So David doesn't what's the sixty three vote mean to you?
Speaker 3: If anything is a win a win? Or is a
Speaker 3: nine zero better than a six to three? How do
Speaker 3: you hashild the market think about that?
Speaker 9: Yeah, I mean I think a win is a win.
Speaker 2: Right, you only need five to uphold the lower court
Speaker 2: and find the tariffs were unlawful.
Speaker 9: But I do think the six to three vote.
Speaker 2: Provides even, you know, even a sharper defeat here for
Speaker 2: the administration's arguments, I mean.
Speaker 1: You had.
Speaker 8: Fine and I know Justice Cavanaugh during the oral arguments
Speaker 8: talked a lot about what President Nixon did on the
Speaker 8: predecessor statue to AYEPA. Where do they find the authority
Speaker 8: of the president to issue these tariffs?
Speaker 9: Yeah?
Speaker 2: So the predecessor to AEPA was the training with the
Speaker 2: Enemies Act Twya, and ac Cordan previously said that the
Speaker 2: language in Twya, that is to regulate importation, did authorize
Speaker 2: limited tariffs, and so I think the Descent is pointing
Speaker 2: back at that and saying, consistent with that holding, we
Speaker 2: would find that the same language that Congress used in Twiya,
Speaker 2: that carried it over into Iepa would authorize the imposition
Speaker 2: of tariffs. And I mean, I do think that as
Speaker 2: a matter if you were reading AEPA in a vacuum,
Speaker 2: the question of whether the language to regulate importation permits
Speaker 2: tariffs is tricky.
Speaker 7: It's difficult explain why it's tricky.
Speaker 2: Well, I think the administration's argument was we can clearly
Speaker 2: ban imports under that language and under AIPA, and they've
Speaker 2: done that for decades under various economic sanctioned statutes. And
Speaker 2: so the theory would go, if we can ban imports,
Speaker 2: why can't we do something more calibrated and measured, such
Speaker 2: as impose a tariff.
Speaker 5: Just a reminder, if you're just joining us, we're speaking
Speaker 5: with Dave Townsend, partner with Dorsey and Whitney, and June Garasso,
Speaker 5: the host of Bloomberg Law. With us here Polswenian Scarlet
Speaker 5: Foo on Bloomberg Intelligence after the Supreme Court struck down
Speaker 5: President Trump's global tariffs, saying that he exceeded his authority
Speaker 5: by invoking a federal emergency powers law. Dave, let me
Speaker 5: ask you a dumb question. President Trump does not respond
Speaker 5: well to legal setbacks. We know that he appeals to
Speaker 5: a higher court an authority. There is no higher court
Speaker 5: than the Supreme Court. But is there really no legal
Speaker 5: recourse for him left here? Could he, I don't know,
Speaker 5: seek to impeach a justice or three justices?
Speaker 2: So I mean, I think there's there's kind of two
Speaker 2: dimensions here in terms of what happens next. One is
Speaker 2: with respect to tariff refunds and whether importers are owned tariffs,
Speaker 2: And the second is what does the administration do next?
Speaker 2: What is the US tariff policy in light of this opinion?
Speaker 2: And the administration has been laying the groundwork, I'm sure
Speaker 2: behind the scenes, but in public too, saying continuity will
Speaker 2: carry the day as of today and moving forward, and
Speaker 2: the tariffs in one form or another will be reimposed
Speaker 2: under probably a combination of authorities. So I think, you know,
Speaker 2: the refund issues important to companies moving forward, the policy
Speaker 2: issue may not actually move that significantly, at least in
Speaker 2: you know, the near term. I think they're going to
Speaker 2: be ready to come out with something very quickly to
Speaker 2: backfill and replace the IPA tariffs.
Speaker 3: All right, Dave, thank you so much for joining us.
Speaker 3: Really appreciated Day Townsend. He's a partner with Dorsey n Whitney.
Speaker 3: Give us his thoughts on the legal side of this case.
Speaker 3: And of course June Grasso, legal analyst for Bloomberg, joining
Speaker 3: us as well.