US President Donald Trump announced he will invoke a 10% global tariff via Section 122. This is generally what was expected but it’s limited to 150 days unless extended by Congress. It also has some of its own legal challenges and is supposed to be invoked after consulting Congress but it looks like we’re going to skip that step.
The thing is, Section 122 was designed for a specific macroeconomic scenario — a genuine balance-of-payments crisis like the kind that troubled policymakers in the 1970s. It was not designed as a general-purpose tariff authority. Using it to reconstruct a global tariff regime would be stretching it well beyond its intended purpose — which is precisely the kind of statutory overreach that six Justices just rejected this morning with respect to IEEPA.
We will see if he carves out any exemptions for some countries but he said it will be “right across the board” and noted that other investigations will take place in the 150 day period.
Update: He says it will go into effect in three days. That’s going to set off a race to get some imports across the border.
Other comments:
“Proud of the justices that voted in favour” and “no way anyone can argue with those who dissented”
The dissent was Kavanaugh, joined by Thomas and Alito. Kavanaugh’s dissent argued for a foreign affairs exception to the major questions doctrine and read IEEPA’s text more broadly. The vote was 6-3 against tariffs.
Says he thinks court has been swayed by foreign interests
This is the most inflammatory statement and the most concerning from a rule-of-law perspective. The suggestion that six Supreme Court Justices — including three Republican appointees — ruled against the administration because of foreign influence is a serious allegation without any evident basis.
Says there are methods that are even stronger that are available to him”
The word “even stronger” suggests he may be looking beyond the conventional options like Section 232 and 301 — possibly Section 338, which allows tariffs up to 50% without a formal investigation requirement, or perhaps something more creative.
Other comments:
- I am allowed to impose an embargo but I can’t charge any money
- I am allowed to cut off all trade with a country
- I will go in a stronger direction now
There is nothing surprising here aside from the speed he’s moving. We will see when Section 122 goes into effect.
“It’s a little bit complicated, it will take a bit more time but the end result is that it’s going to get us more money,” he said.
Update: Treasury Secretary Bessent said they will be “potentially” using Section 232 and Section 301 tariffs and that will result in virtually unchanged revenue in 2026.
