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[00:00:00] The Supreme Court struck down those [00:00:01] liberation day tariffs today. The [00:00:04] reality, as Kavanaaugh points out in his [00:00:05] descent, is the president has a bunch of [00:00:07] other ways to impose tariffs. He's got [00:00:09] section 122 of the trade act of 1974, [00:00:12] which allows the president to impose a [00:00:14] temporary import sir charge to deal with [00:00:16] large and serious balance of payment [00:00:18] deficits to 150 days. [00:00:20] There's also section 2011 of the trade [00:00:23] act of 1974 [00:00:25] that provides that if the international [00:00:27] trade commission determines that an [00:00:29] article is being imported in such [00:00:30] quantities that it causes serious injury [00:00:32] to domestic industry, the president [00:00:34] could take some action. Now, that does [00:00:36] rely on the ITC. Section 301 allows the [00:00:39] president to impose duties if he [00:00:41] determines that an act, policy or [00:00:43] practice of a foreign country is [00:00:44] unjustifiable and burdens or restricts [00:00:46] US commerce. So, that would be like [00:00:48] unfair trade practices. So some of these [00:00:50] tariffs could theoretically come back [00:00:52] and Kavanagh points out that all the [00:00:55] tariff revenue that has been collected [00:00:56] is now in limbo. How does that how who [00:00:58] who pays that right? Taxpayers paid the [00:01:00] elevated prices [00:01:02] people who are importing to the United [00:01:04] States [00:01:06] paid those prices. Where does that money [00:01:07] go? The answer in all likelihood is that [00:01:09] the money just kind of sits that what's [00:01:12] done is done. There's no redress that is [00:01:14] available. Just going forward the [00:01:15] president can't use this sort of [00:01:16] authority. So that is the breakdown. The [00:01:19] markets are responding by not doing much [00:01:21] because they don't actually know what's [00:01:22] happening because no one knows what's [00:01:23] happening. Is Trump going to let it die? [00:01:25] What I think is a smart economic move. [00:01:27] Impose targeted tariffs for specific [00:01:30] reasons as a as a weapon of leverage. [00:01:34] If Congress wants to pass big tariffs, [00:01:36] go ask Congress for it. That's what I [00:01:39] think that that they should do. Or are [00:01:41] they going to go whole hog? Will the [00:01:44] Trump administration try to reimpose all [00:01:47] of the all of these tariffs? Right? That [00:01:49] that is the big question. Well, joining [00:01:51] us on the line to discuss the legal [00:01:52] decision-making here is Ilia Shapiro. [00:01:54] He's the senior fellow and director of [00:01:55] constitutional studies at Manhattan [00:01:57] Institute. Ilia, thanks so much for the [00:01:58] time. Appreciate it. [00:02:00] >> Good to be with you. And uh I must say I [00:02:02] agree with everything you said and I'm [00:02:04] impressed that you digested that opinion [00:02:07] almost in in in live time on air. It's a [00:02:10] convoluted 170 pages. [00:02:14] It is there there's a lot there. Um I I [00:02:17] I thought that actually the two most [00:02:18] radical implications were being drawn by [00:02:20] the the dissents. One drawn by Justice [00:02:23] Thomas, which honestly I I found kind of [00:02:25] shocking from Justice Thomas. Uh and and [00:02:27] the other being drawn by the dissenting [00:02:30] liberals on the court who who seem to [00:02:32] want to obliterate the major questions [00:02:33] doctrine so that Congress can delegate [00:02:35] all power to the president without any [00:02:37] question of majority questions. And they [00:02:39] could do so unclearly. They could have [00:02:40] like a vague statute and then all power [00:02:42] just suddenly resides in the executive [00:02:43] branch whenever the left of the court [00:02:45] thinks it's fine. And and honestly, I'm [00:02:47] a little puzzled by Justice Thomas' [00:02:49] descent here in which he seems to argue [00:02:50] that that Congress can simply move core [00:02:53] powers that don't implicate life, [00:02:55] liberty, or property over to the [00:02:57] executive branch. That that seems to [00:02:59] pave the way for a massive land grab by [00:03:01] the executive branch. I suppose that [00:03:04] Justice Thomas would argue, well, you [00:03:05] know, Congress needs to defend its own [00:03:07] prerogative, not our job, is article [00:03:08] three to do that. What's your take on [00:03:10] it? [00:03:11] >> Yeah, I was surprised by that as well, [00:03:13] particularly given his opinions in [00:03:15] previous so-called non-legation cases, [00:03:18] the idea the challenges to expansive [00:03:21] grants uh of power where he has been on [00:03:24] the side of no, Congress can't pass that [00:03:27] along whether in high-profile cases or [00:03:29] lowprofile cases, politically salient or [00:03:32] not. So, this very much cuts against his [00:03:34] normal grain. Kavanaaugh I was less [00:03:36] surprised about because he's always been [00:03:39] for executive power working in the Bush [00:03:41] White House uh etc. and sort of makes [00:03:43] carveouts for foreign affairs and [00:03:45] certain other things. That was [00:03:46] understandable, very kind of a [00:03:48] technocratic ruling to which Roberts uh [00:03:50] replies that there's no foreign affairs [00:03:52] exception to major questions. But you're [00:03:54] right, Thomas is is a headscratcher. And [00:03:56] of course, Alto did not uh write uh [00:03:59] separately. He joined Kavanaaugh's [00:04:01] opinion, not Thomas'. [00:04:04] >> Yeah, there a bunch of sort of weird [00:04:05] oddities to the way that the the opinion [00:04:08] voting broke down here. I pointed out a [00:04:10] little bit earlier that there is [00:04:11] something odd about Chief Justice [00:04:13] Roberts who declared that Obamacare was [00:04:15] not in fact a tax in order to declare it [00:04:18] constitutional. Now declaring that [00:04:19] tariffs are in fact a tax in order to [00:04:21] declare them unconstitutional. I you [00:04:23] know I I think that both of those things [00:04:24] are taxes and we should declare them as [00:04:26] such. So there is there's a bit of irony [00:04:28] there. Um but it it is it is a [00:04:30] fascinating breakdown. The big question [00:04:31] that the Kavanaaugh pushes forward [00:04:33] obviously is what happens to all that [00:04:35] tariff revenue that was collected. My my [00:04:37] belief is that the courts are basically [00:04:39] going to leave that where it was. I I [00:04:40] don't think that there's going to be any [00:04:42] really great way to sort of untie that [00:04:44] that Gordian knot. The money has already [00:04:46] changed hands. It's already come in. [00:04:48] It's hard to see kind of where the [00:04:50] specific damages lie because if you are [00:04:52] an exporter to the United States, for [00:04:53] example, did you pay the tariff or did [00:04:55] the consumer pay the tariff? And if you [00:04:57] made a bunch of money off exporting to [00:04:59] the United States, as many exporters [00:05:00] actually did, were you damaged? My guess [00:05:03] is that the court is basically going to [00:05:04] throw up its tan and say, "Listen, you [00:05:05] know, what what happens from now on is [00:05:07] is the only thing that that we're ruling [00:05:09] on here." [00:05:10] >> Well, I'm not surprised the Supreme [00:05:12] Court didn't rule on that because it is [00:05:14] complicated. It wasn't briefed. It [00:05:16] wasn't presented or ruled upon by the [00:05:18] lower courts. This all now goes back to [00:05:20] the lower courts where if someone seeks [00:05:22] a refund, there might be multiple [00:05:23] mechanisms. We don't know. uh tariffs of [00:05:26] this scale have never been rejected [00:05:27] before. But whether it's in the court of [00:05:29] federal claims, federal district courts, [00:05:31] some sort of trade mechanism uh through [00:05:34] uh obscure administrative offices, I'm [00:05:36] not even fully aware of because I'm not [00:05:38] a trade lawyer. Um that is, you know, [00:05:40] this is a full employment act for trade [00:05:41] lawyers still uh to figure uh all of [00:05:44] that out. And those questions may [00:05:46] eventually get to the Supreme Court, [00:05:47] although I doubt it. I think they're [00:05:48] going to be some some uh you know, very [00:05:50] technical rulings uh coming down below. [00:05:53] We'll get to more on this in just one [00:05:54] moment. First, now it's very easy to run [00:05:57] into title issues. You actually don't [00:05:59] know about it until you check. Here's [00:06:00] the deal. There's a certain type of real [00:06:02] estate scam out there. It's called title [00:06:03] theft. It's exactly as bad as it sounds. [00:06:05] Criminals can forge a signature, [00:06:06] transfer your property out of your name, [00:06:08] and steal your home equity all before [00:06:10] you even realize what's happening. Which [00:06:11] is why I partner with Home Title Lock. 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It is actually [00:06:48] the value you hold in your home. If that [00:06:50] is robbed from you, you've lost the [00:06:51] value of your home. Don't let that [00:06:53] happen to you. Head on over to [00:06:54] hometitlelock.com, promo code Ben, or [00:06:56] use the link below. Again, that's [00:06:57] hometitlelock.com, [00:06:58] promo code Ben, to get started right [00:07:00] now. [00:07:00] >> I think I think a majority will agree [00:07:03] with Kavanaaugh uh does agree with [00:07:05] Kavanaaugh that there are other methods [00:07:07] of putting in other kinds of tariffs. U [00:07:11] you know, Roberts's majority opinion is [00:07:14] very narrow in that sense. It basically [00:07:16] says this statute does not authorize [00:07:18] these tariffs. We say nothing about [00:07:20] anything else. Gorsuch was was similar [00:07:22] about that. And so Scott Bent, the [00:07:25] Treasury Secretary, now that we've been [00:07:26] going on for months since the opinion [00:07:28] and it looked like that means that the [00:07:30] tariffs were going down, he's been very [00:07:32] publicly discussing all of these other [00:07:35] alternatives saying the sky isn't [00:07:36] falling. We can still impose various [00:07:38] other tariffs. So that is probably less [00:07:40] of a practical consequence. But another [00:07:43] point that Kavanaaugh raises about our [00:07:45] trade deals that are tied to the current [00:07:48] level of tariffs, will those now be need [00:07:50] to be re-examined? A lot more [00:07:52] uncertainty there, I think, than in [00:07:54] those individualized tariffs that may [00:07:56] remain or may uh uh now be put in place [00:08:00] by the administration. [00:08:02] >> Now, in my opinion, if you're the [00:08:04] Treasury Secretary, Scott Besson, I [00:08:05] think that you are overjoyed today. And [00:08:07] I think the reason that you are [00:08:08] overjoyed today is because the president [00:08:10] is not going to get lost in the weeds of [00:08:12] which particular statutes allow which [00:08:14] particular tariffs. But you know who [00:08:15] will get lost in those weeds? The [00:08:17] Treasury Secretary. And the Treasury [00:08:18] Secretary will will be able to use the [00:08:21] law as a way of arguing to the [00:08:23] president, hey, look, Mr. President, [00:08:24] there's certain stuff we can do. There's [00:08:25] certain stuff we can't do. Let's be [00:08:27] targeted in our approach so we don't run [00:08:28] up against this thing again. And you [00:08:31] know, I think the Treasury Secretary [00:08:33] does not have the blunderbust approach [00:08:34] to tariffs that the president seems to [00:08:36] have. and then withdraw and then take it [00:08:37] back. And you know, just to be real [00:08:39] about this, the the economic growth [00:08:40] statistics that came out from last year [00:08:42] are weaker than they they really should [00:08:44] be. They're about 2% 2.2% GDP growth [00:08:47] over the course of 2025. Those are not [00:08:48] the kind of numbers that are going to [00:08:50] sustain a a midterm victory for [00:08:52] Republicans or secure a 2028 victory for [00:08:55] Republicans. And tariffs have had a [00:08:57] hampering effect on the economy. So, I I [00:08:59] happen to to be of the very strong [00:09:02] informed opinion that the Treasury [00:09:03] Secretary is not in fact a great lover [00:09:05] of tariffs from the get-go the way that [00:09:06] the president of the United States is. I [00:09:08] think he is now going to have the legal [00:09:09] tools at his disposal to be a lot more [00:09:11] targeted in how tariffs are applied as [00:09:13] opposed to President Trump going out [00:09:14] there with a poster board and declaring [00:09:16] that penguins on the Solomon Islands are [00:09:18] now going to be footing the cost for [00:09:19] America's deficits. [00:09:21] >> That's right. those uh uh penguin suits. [00:09:25] I don't know if that's where we get our [00:09:26] tuxedos. Uh won't won't have those [00:09:28] tariffs on them. Uh and you know, this [00:09:30] might foreshadow more broadly the [00:09:32] court's approach to checking the [00:09:35] administration when it steals bases in [00:09:38] effect. You have to follow proper [00:09:39] procedures, whether that's with respect [00:09:41] to dinging Harvard for civil rights [00:09:44] violations or uh you know, birthright [00:09:46] citizenship is going to come down the [00:09:48] pike. And I think what the court's going [00:09:50] to do with that is not rule on the on [00:09:51] the underlying constitutional merits, [00:09:53] but just say the president can't do it [00:09:55] alone. So I think this ruling, even [00:09:57] though it's significant economically and [00:09:59] has all this media attention, uh at the [00:10:01] end of the day is is a narrow procedural [00:10:03] ruling saying you didn't follow the [00:10:05] precise steps. You have all of these [00:10:07] statutes that you can uh use uh whether [00:10:09] it's to go against uh you know, Canada [00:10:12] and Western Europe or China or what [00:10:14] whatever your goals are specifically. Uh [00:10:16] go ahead and use them. You can't just [00:10:18] have a a cart blanch uh delegation, [00:10:21] which is again why it's surprising that [00:10:23] Justice Thomas, I think, would have let [00:10:25] um the president, any president, not [00:10:27] just Trump, have that kind of uh intense [00:10:30] taxation authority. [00:10:32] >> I'm not that short, but you know what is [00:10:33] short? This clip. View more like this [00:10:35] one on the Ben Shapiro Show Clips [00:10:37] channel by clicking the subscribe button [00:10:38] down below.