The case that the Court decided, Learning Resources, Inc. v. Trump and Trump v. V.O.S. Selections, was the consolidation of two lawsuits, brought by small businesses and states, challenging Trump’s use of IEEPA. IEEPA is a powerful tool; its provisions include a long list of commerce-related actions, such as imposing export restrictions and quotas, that a President can take in the case of a national emergency. The problem for Trump is that “tariffs” is not on the list. Neither are related terms, like “duties” or “customs.” The entire world-market-upsetting tariff scheme—under which, Roberts wrote in the majority decision, Trump asserted that “the independent power to impose tariffs on imports from any country, of any product, at any rate, for any amount of time”—was built on nothing more than the awkward placement of the word “regulate” a couple of lines away from the word “importation.” And, as Roberts stated and a six-Justice majority found, “Those words cannot bear such weight.”
Justice Elena Kagan, in a concurrence joined by Justices Sonia Sotomayor and Ketanji Brown Jackson, tallied up nine verbs in IEEPA (such as “investigate,” “block,” “direct”) and eleven objects related to foreign commerce (“acquisition,” “withdrawal,” “transfer”), meaning that there are “99 actions a President can take to address a foreign threat.” But, if the action in question, “regulate . . . importation,” really meant “impose tariffs,” it would be the “the odd man out,” in Kagan’s words, because “exactly none of the other 98 involves raising revenues.” IEEPA has been used, by various Presidents, more than seventy times, for example, to impose sanctions on Iran and Cuba; none has used it for tariffs.
This question of revenue was highly significant to the Justices, because tariffs are a kind of tax, and, in our constitutional system, the power to tax is a central aspect of Congress’s power, not the President’s. (In 2012, the statute creating Obamacare survived a major constitutional challenge because the Court decided, in a landmark decision also written by Roberts, that the individual mandate to acquire health care was a form of tax.) The presumption is that, if Congress gave the President the ability to impose tariffs, as it sometimes does, it would make it reasonably clear that it was doing so. But IEEPA does not look like any kind of a tax law. In the oral arguments for the case, D. John Sauer, Trump’s Solicitor General, tried to get around the problem by contending that Trump’s tariffs shouldn’t really be thought of as taxes at all—a position that was met with near-mockery from even some of the conservative Justices.
And Trump’s new tariffs have raised a great deal of revenue—almost two hundred billion dollars’ worth, according to an estimate by economists at the Penn-Wharton Budget Model for Reuters. But Roberts’s opinion says nothing about whether or how that money might be refunded. “While the Supreme Court’s decision was pending, hundreds of importers filed suit at the Court of International Trade, seeking refunds of the tariffs paid,” Mark Wu, a professor of international trade law at Harvard Law School, told me. “Those cases were stayed, but with the decision handed down, those cases can now proceed.” Trump, on Friday, wondered why the Court hadn’t put in a sentence telling him whether to “keep the money or don’t keep the money.” He added, “I guess it has to get litigated for the next two years.” A moment later, Trump upped that estimate to five years.
The lack of guidance on refunds may be an indication that Learning Resources, Inc. v. Trump was not a simple case for the Justices, despite the lopsided outcome. There are seven separate opinions, adding up to a hundred and seventy pages. The principal dissent, by Brett Kavanaugh—whom Trump, on Friday, thanked for “his genius”—is more than sixty pages. Justices Samuel Alito and Clarence Thomas joined Kavanaugh; Thomas also wrote a dissent in support of broad tariff powers for Presidents. And even the Justices who agree with one another are in some ways at odds. Roberts only mustered a majority for part of his opinion; midway through, the three liberals peeled off, meaning that, although there is a 6–3 majority on striking down the tariffs, there is no full consensus on the reasoning or its implications. Specifically, the liberals declined to join the section in which Roberts wrote that Trump’s tariffs are unlawful because they do not meet the demands of something called the “major questions doctrine.”
