The signature policy proposal of Donald Trump’s third campaign for president a tariff: 60 percent tax on all imports from China and 10 percent on imports from any other country. He doesn’t just want this tax increase, which has to be raised About $291 billion or 1 percent GDP If fully implemented, but he says he will do it unilaterally. “I don’t need Congress, but they will approve it,” Trump The announcement was made at the September 23 rally. “If they do not I shall have the right to impose them myself.”
This is a rather large policy change for a president to undertake unilaterally, and one of questionable legality. For comparison, Trump is considering an increase More than twice as big Obamacare funds use as tax increases. (And make no mistake — tariffs are tax increases.) Experts such as former deputy director-general of the World Trade Organization (WTO) Alan Wm They argue that no law passed by Congress gives the president the power to impose across-the-board tariffs along the lines Trump has proposed.
Nevertheless, Congress has given the executive branch a significant amount of flexibility to set tariffs. This is a mistake. Members of Congress, whether they support Trump’s tariff plan or not, should be able to agree on: As the Constitution states Taxing clauseIt is the job of Congress to set tax and spending policies for the United States. This has been the case throughout the history of the United States, the traditional role of the legislature in all democracies, and instead of placing this power in the hands of the president, representatives are excluded from the process of determining how taxes are paid—an idea that goes back to before the American Revolution.
Although Congress has left the power to tax commerce to the president and cabinet in the past, it should reverse that trend. One way to do this is to pass a bill Sen. Rand Paul’s representation is no taxation without legislation To ensure that any changes to tariffs are subject to a vote of Congress before they take effect.
Tariff power of the President, explained
The President’s power to impose tariffs does not arise from a general bill or program; Rather, it has grown gradually over time, with a particular expansion over the past decade as the Trump administration has rediscovered authority over old laws that enabled it to wage a trade war with China and protect the steel industry.
Section 232 of the Trade Expansion Act of 1962For example, it gives the president the right to impose tariffs on the recommendation of the commerce secretary without asking Congress In 2018, Trump used this authority to impose tariffs on steel and aluminum, which Biden has expanded somewhat recently.
Section 301 of the Trade Act of 1974 Provides similar authority to impose tariffs based on unfair trade practices of foreign countries on the advice of the Office of the US Trade Representative. Trump has used this power to impose Sweeping tariffs against China. Biden has also made liberal use of this power, Expansion of tariffs In steel, batteries, solar cells and electric vehicles from China.
Finally, there is Section 201 The same 1974 law, which allows for tariffs against imports that “seriously injure or threaten … serious injury” to domestic companies. Trump and Biden used it Tariff justification on washing machines and solar cells from most countries.
Even if Trump can’t implement a 10 percent tariff on all imports with his executive powers — because previous authority only applies to certain industries or certain countries — he can make a lot of progress toward that goal. His 60 percent tariff on all Chinese imports, for example, may very well be possible because it narrowly targets one country. He and Biden have proven that the president can raise taxes on imports very significantly without Congress.
I think most of Trump and Biden’s tariffs were wrong, and Trump’s more comprehensive tariff plan amounts to Significant tax increases on the poor and middle class that will be Loss of US exportsInvite retaliation from other countries, damage America’s international reputation, and failed to create any Work for people Those who need them. (There is Vice President Kamala Harris Trump attacked the tariff plan as a “sales tax.” But didn’t rule out Biden’s tariff policies.)
That said, you don’t have to agree with me on the merits of tariffs to agree with one narrow point about the process: It shouldn’t be a presidential decision. Congress is a branch of government invested with the power to tax and spend, and these commerce laws narrowed its powers to the benefit of the executive branch in a way that is difficult to justify. The Social Security Administration is not authorized to set Social Security taxes, nor is the Department of Health and Human Services authorized to set Medicare taxes, but the Department of Commerce and the Office of the U.S. Trade Representative are expressly authorized to recommend tariffs that become effective upon presidential approval. . Why is commerce the exception?
A possible argument could be that tariffs are a tool of foreign policy, which is traditionally an area where the executive has more autonomy. But even in that context the customs power is extraordinary. required congressional authority to ratify treaties and declare war; The War Powers Resolution means that less armed conflict than declared war also requires congressional approval, such as financing conflicts. Allowing a tariff increase without a congressional vote is a huge adjournment of authority.
Republicans and Democrats have more specific, partisan reasons to worry about the president’s tax powers. For the past half-century, the GOP has largely been a free-market, anti-tax party, which naturally leads to suspicion of taxes, and especially of unilateral presidential power to impose taxes. As outgoing Senate Minority Leader Mitch McConnell (R-KY) recently put it, “I’m not a fan of tariffs. They raise prices for American consumers. I’m a free-trade type of Republican who remembers how many jobs are created by the exports we engage in. A large number of Republicans still hold that worldview should support curbing the president’s power to impose tariffs.
Democrats, even those sympathetic to tariffs and skeptical of free trade, should be wary of bending the entire policy spectrum to Trump’s whims if he wins the election. He showed in his first term that he was very willing to use the tariff powers, more willing than any recent president, and his second term should, if anything, see him using them more promiscuously.
Presidential authority over tariffs also opens the door to corruption. Importers are allowed to apply to the Department of Commerce for certain exemptions from duty, an allowance corporation. Use it to extract amazing benefits. Apples, for example, Exempted from anti-China tariffs For iPhone and Apple Watch.
Given what we know about Donald Trump and him clientlist, Convenience-trade mode of politicsIs it really a kind of power he should have? Is it a power that Democrats will trust him to use in non-corrupt ways? Or should Congress have the power to lower tariffs and limit scope for abuse?
Congress must act sooner rather than later
Certain presidential powers, such as the power to pardon political allies or immunity from prosecution, arising from the Constitution or its interpretation by the Supreme Court. But tariff powers are derived from laws passed by Congress, and they can be revoked by further acts of Congress.
During the Trump years there were some proposals to require congressional approval for Section 232 tariffs, esp Trade Authority Act Introduced in the Senate by Mark Warner (D-VA) and Pat Toomey (R-PA). That bill has been kept alive in recent Congresses Reps. Mike Gallagher (R-WI) and Don Baer (D-VA). But Gallagher has since resigned from Congress, and Toomey retires in 2022.
In fact, Section 232 is a source of authority that the President can use to impose tariffs. Sections 201 and 301 of the Trade Act of 1974 would exist and could be used to raise taxes unilaterally. The Supreme Court can, in theory, strike down tariffs that exceed Congress’s delegated authority, but historically, the courts have deferred to the commerce executive.
The only bill I know of to deal with the entire suite of legislation authorizing the President’s tariffs There is no taxation except through the Act of Representation From Rand Paul. As Paul put it in a statement introducing the bill: “Taxes our citizens, threatens our economy, raises the price of everyday goods, and erodes the system of checks and balances our founders so carefully crafted.”
I find myself agreeing with Paul on very little, but he’s dead right on this one: taxation is a congressional authority, and it should apply to tariffs like anything else.
“To me it’s sensible policy,” Wolff, a former WTO executive and veteran US trade negotiator, told me. He could add carve-outs to give executive flexibility in emergency situations (such as when another nation imposes tariffs against us first, or as part of sanctions measures against a state like Russia or Iran), but broadly, Congress should approve the policy if tax increases make sense. Either.
We are essentially running out of time to act before Congress Pre-election October breakAnd it can be difficult to work in November and December when we know who the next president will be, and their allies may be less willing to support moves to limit their power. But the battle will only get tougher when a new president takes office and starts proposing tariffs.
Time to act this year, before that happens and Congress has a chance to reassert its taxing power. The alternative would mean hundreds of billions of dollars worth of tax increases unilaterally issued by the president, without Congress being able to stop them.
