At a recent policy forum hosted by the National Press Foundation and the Heinrich Foundation, legal experts, trade policy analysts, and journalists assessed the implications of the Trump administration’s aggressive tariff strategy. The discussion highlighted significant legal challenges, economic disruptions, and growing uncertainty for U.S. businesses.
IEEPA and Presidential Tariff Authority
Central to the administration’s tariff actions thus far has been is its use of the International Emergency Economic Powers Act, a statute traditionally reserved for national security threats, to impose broad-based tariffs. This approach has been struck down by federal courts twice already (see here and here), though those cases are on appeal and are likely to be ultimately be decided by the Supreme Court.
Jeffrey Schwab, senior counsel at the Liberty Justice Center, said those rulings have countered Trump’s claims that “he can impose tariffs on any country, at any rate, for any reason.” The Constitution assigns that power to Congress, Schwab said, “and Congress has not delegated such broad authority.”
However, former U.S. ambassador to the World Trade Organization Dennis Shea responded that the administration’s actions are consistent with the law because the IEEPA tariffs are designed to “address persistent trade deficits” that constitute a national security concern that justifies the use of emergency powers.
Legal Alternatives
Even if the courts ultimately limit the use of IEEPA for tariff purposes, panelists noted that the administration retains access to other statutory tools, including:
- Section 232 of the Trade Expansion Act of 1962 (national security);
- Section 301 of the Trade Act of 1974 (unfair trade practices);
- Section 122 of the Trade Act of 1974 (balance-of-payments imbalances); and
- Section 338 of the Tariff Act of 1930 (discrimination against U.S. commerce).
Each of these authorities includes procedural safeguards, such as agency investigations and public comment periods, that are largely absent under IEEPA. Schwab emphasized that these mechanisms thus provide greater transparency and predictability for businesses than the use of IEEPA. While Congress retains the ability to terminate national emergency declarations underlying IEEPA tariffs through a joint resolution, such action is subject to presidential veto and requires a two-thirds majority to override—an unlikely outcome in the current political environment.
Economic Impacts
The economic effects of the administration’s tariff policy have been mixed. David Lynch, global economics correspondent for The Washington Post, warned that the administration’s current baseline 10 percent tariff on all imports, potentially rising to 15 or 20 percent, could have significant long-term consequences. “Large firms may be able to absorb a 10% tariff, but higher rates will be much harder to manage,” he said.
There is also a growing burden on small and medium-sized enterprises, said Deborah Elms, head of trade policy at the Heinrich Foundation. “Many firms stockpiled inventory ahead of tariff deadlines, but those buffers are running out,” she said. “We’re seeing increasing strain on U.S. businesses, particularly in sectors already subject to high tariffs, such as steel, aluminum, and auto parts.”
Elms also noted that additional Section 232 investigations are underway, targeting sectors such as pharmaceuticals, drones, and semiconductors. “The scope of these tariffs is expanding rapidly, and the uncertainty is making it difficult for businesses to plan,” she said.
Supply Chain Shifts
The panelists agreed that the administration’s tariff strategy is accelerating a broader realignment of global trade. Elms described a growing trend among multinational firms to adopt “in U.S. for U.S.” production strategies, while simultaneously diversifying supply chains to reduce exposure to U.S. trade policy volatility. “We’re seeing companies pivot away from the U.S. as a central hub,” she said. “This includes increased regional integration in Asia and growing interest in trade agreements that exclude the U.S., such as the CPTPP.”
While the U.S. remains a critical market, Elms warned that continued unpredictability could erode its central role in global supply chains. “The longer this uncertainty persists, the more likely it is that firms will make permanent changes to their sourcing and investment strategies.”
Conclusion
The Trump administration’s tariff strategy represents a fundamental shift in U.S. trade policy, panelists said, with far-reaching implications for businesses, legal frameworks, and international economic relations. While some firms have adapted in the short term, the long-term outlook remains uncertain—particularly if the courts uphold the administration’s expansive interpretation of IEEPA.
As the legal and political landscape continues to evolve, proactive engagement with trade counsel, supply chain advisors, and government affairs professionals will be essential for navigating the next phase of U.S. trade policy.
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