Tariff Arsenal and Judicial Boundaries: The Ultimate Game Over U.S. Presidential Trade Powers
20/01/2026
The air in Washington is thick with a familiar tension. The justices of the Federal Supreme Court are about to rule on a case that could reshape U.S. trade policy, and the White House already has contingency plans ready. In an interview with The New York Times, U.S. Trade Representative Jamison Greer revealed that if the Supreme Court rules that the global tariffs imposed by the Trump administration under the International Emergency Economic Powers Act are invalid, the administration will initiate procedures the very next day to reimpose tariffs using other legal grounds. This statement is not mere bluster; it unveils an ongoing, deep-seated struggle over the boundaries of executive power and the instrumentalization of trade policy tools. The outcome of this struggle will not only affect U.S.-China and U.S.-Europe trade relations in the coming months but may also set a new precedent for presidential trade authority in the post-Trump era.
Administrative Preparations on the Edge of a Judicial Cliff
The window for Supreme Court rulings is rapidly narrowing. At the heart of the case lies the International Emergency Economic Powers Act, frequently utilized by the Trump administration. Enacted in 1977, this law was originally intended to grant the president broad authority to regulate international economic transactions after declaring a national emergency. Over the past year, the Trump administration has invoked this act to swiftly impose or adjust tariffs on trading partners, including Canada, Mexico, and China, citing various reasons such as addressing trade deficits and curbing the flow of illicit drugs.
Greer's remarks convey two clear signals. First, the administration has fully prepared for a potential legal defeat and will not alter its trade policy route centered on tariffs due to judicial setbacks. Second, the White House believes it possesses various alternative legal tools sufficient to sustain its tariff offensive even if existing authorizations are overturned. This toolbox mindset elevates tariffs from a mere economic policy instrument to an administrative strategic resource that can be deployed at any time.
The defense by Treasury Secretary Scott Bessant was even more straightforward. In response to the controversy sparked by the threat to impose tariffs on seven European countries over the Greenland issue, he attempted to draw a comparison between economic measures and military conflict, claiming that leveraging the United States' economic strength to avoid a hot war inherently constitutes an evasion of a national emergency. This discourse, which directly links trade threats to the prevention of geopolitical conflicts—though criticized by detractors as a blatant misuse of emergency laws—clearly demonstrates how the current administration has extended the logic of weaponizing tariffs beyond the realm of traditional trade.
The Arsenal of Law: How Extensive Is the President's Tariff Toolkit?
In the interview, Greer outlined alternative solutions that essentially sketch a map of the U.S. President's trade authority delegation. These proposals are not hastily assembled but are rooted in a series of trade acts passed by Congress over decades.
Section 122 of the Trade Act of 1974 is a key option. This provision allows the President to impose an additional tariff of up to 15% for a period of up to 150 days when facing a serious balance of payments deficit. The threshold for invoking this provision is relatively clear, requiring a specific balance of payments problem, but the definition of a "serious deficit" leaves some room for interpretation.
More powerful is **Section 338 of the Tariff Act of 1930**. This law authorizes the President to impose tariffs of up to 50% on any country that discriminates against U.S. commerce. It is a long-standing tool, created against the backdrop of protectionist waves during the Great Depression, but the provision itself has not expired over time. Greer specifically mentioned this section, implying that the administration is prepared to characterize certain policies of trading partners as discriminatory, thereby triggering this high-tariff authority.
Additionally, Section 301 of the Trade Act of 1974 and **Section 232 of the Trade Expansion Act of 1962** are tools that the Trump administration has already skillfully utilized. Section 301 targets unreasonable or discriminatory foreign trade practices, serving as the primary legal basis for the tariff war against China during the previous term, and it has withstood multiple legal challenges. Section 232, on the grounds of national security, has been used to impose tariffs on steel and aluminum imports. The common feature of these provisions is that they grant the president considerable discretion, but they also require some form of investigation, reporting, or specific justification, unlike the IEEPA, which can be activated almost immediately based on the president's unilateral declaration of a national emergency.
The essence of the issue lies in flexibility. The reason IEEPA is so favored is precisely because it grants the President nearly unrestricted rapid response capability. In contrast, other legal tools, to varying degrees, impose procedural thresholds or substantive justification requirements. Once the Supreme Court denies the applicability of IEEPA in the tariff domain, the Trump administration will have to shift from an immediate threat mode to a prepared action mode. While the arbitrariness and unpredictability of its tariff policies may be somewhat reduced, the depth of its toolbox is sufficient to ensure the continuation of its core strategy—using tariffs as a means of diplomatic and economic coercion.
Greenland Interlude: A Self-Defeating Legal Strategy?
At the critical moment when the Supreme Court is deliberating its ruling, Trump's remarks threatening to impose tariffs on European countries over the Greenland issue have triggered complex reactions within Washington's legal circles. Tactically, this appears to be a typical Trump-style negotiation strategy—making an extreme demand to create room for subsequent negotiations. However, from a legal strategy perspective, this move may prove counterproductive.
Georgetown University law professor Stephen Vladeck sharply pointed out that while the administration is defending its novel and textually detached interpretation of IEEPA before the Supreme Court, threatening to use the same law for the more bizarre purpose of purchasing another country's territory is not a good look for the Trump administration. Senator Rand Paul's criticism was more direct: emergency powers are for emergencies. There is no emergency in Greenland. This is absurd.
These criticisms touch on a fundamental issue: Does excessively expanding the definition of a national emergency erode the very legal foundation of the law itself? The Trump administration’s linkage of tariff threats with sovereignty negotiations over Greenland essentially transformed the IEEPA from a tool for addressing sudden economic or security crises into a routine lever for advancing long‑term geopolitical ambitions. This manner of application, even in the eyes of its supporters, appears strained and is more likely to provide ammunition for Supreme Court justices to question its overall legal standing.
In an email, Ted Murphy, an attorney at Sidley Austin LLP, pointed out that he believes Trump would still rely on the IEEPA to impose such tariffs, as "I am not aware of any other trade statute that would cover this scenario (e.g., another country refusing to sell its sovereign territory to the United States)." This statement inadvertently reveals the paradox in the administration's logic: precisely because no other law explicitly authorizes the president to impose tariffs for the purchase of territory, the concept of a national emergency must be stretched indefinitely. Whether this logic would hold up in court is doubtful.
Beyond Adjudication: The Prospects of Tariffs as a Long-Term Strategic Tool
Regardless of the Supreme Court's ruling, a broader trend has become clear: tariffs have been deeply embedded in the strategic toolkit of the current U.S. administration and are likely to become a lasting feature of future U.S. trade policy. Cornell University economics professor Eswar Prasad's assessment hits the mark: even if faced with an unfavorable ruling, it may only force Trump to change tactics or legal grounds, but his pattern of actively using tariffs as a tool to advance geopolitical ambitions appears to have solidified.
The persistence of this model stems from several deep-seated factors. Firstly, the political visibility and directness of tariffs make them an effective symbol for demonstrating a tough stance to domestic voters. Secondly, in today's highly complex global supply chains, the deterrent power of tariffs far exceeds their actual economic impact, allowing for the exertion of asymmetric pressure on adversaries at a relatively low cost. Finally, the frequent use of tariffs in recent years has not led to an immediate collapse of the U.S. economy, which to some extent has weakened the economic arguments of domestic opposition, thereby raising the acceptable risk threshold for this policy tool.
Greer's summary that Congress has granted significant tariff powers to the U.S. President highlights the institutional roots. Over the decades, Congress has, through a series of legislative acts, intentionally or unintentionally ceded broad trade policy discretion to the executive branch. Such delegation may have been less problematic during periods of stable globalization and basic bipartisan consensus on trade liberalization. However, in the current era of rising populism and intensified great-power competition, it has endowed the President with a powerful tool capable of unilaterally disrupting the global economy.
The Supreme Court's ruling may affect the speed and flexibility of the Trump administration's tariff increases in the short term, but it is difficult to fundamentally strip away its ability to wage a tariff war. The real constraints may come from elsewhere: first, the cumulative costs imposed by tariffs on American domestic consumers and businesses eventually reach a political tipping point; second, the joint countermeasures from trading partners create unbearable diplomatic and economic pressure; third, the next administration chooses to return to a more traditional, multilateral framework for trade policy.
However, once Pandora's box is opened, it is difficult to completely close it. The Trump administration's instrumental use of tariff weapons has set a new precedent, blurring the lines between economic policy, national security, and diplomatic coercion. Future U.S. presidents, regardless of party affiliation, will face a redefined power landscape: the trade weapons at their disposal are more powerful and more tempting than ever before. While the Supreme Court's ruling may temporarily set a judicial boundary for the exercise of this power, the deeper question determining the future direction of U.S. trade policy is whether Congress is willing and able to rebalance this authority through legislation.
This lawsuit surrounding the IEEPA thus transcends a mere legal dispute. It is a profound debate about where the administrative power of a superpower should stop in the 21st century, and to what extent its economic tools can be used to pursue non-economic goals. The day of the ruling is approaching, but the debate is far from over.
Reference materials
https://www.khaleejtimes.com/world/americas/trump-would-quickly-replace-tariffs-after-court-action