A paper published by the Montreal Economic Institute examines the legal battle over President Trump's tariffs and argues that his trade policy rests on weak legal foundations. The author, who helped litigate the earlier challenge, notes that the Supreme Court invalidated the initial IEEPA-based tariffs, holding that the law does not authorize tariffs and that the Constitution assigns tariff power to Congress. The court also rejected the idea that the president has unlimited authority to impose tariffs at any rate on any product.
The paper then walks through the administration's subsequent attempts to find new legal authority. Tariffs based on Section 122 of the Trade Act of 1974 were struck down by the US Court of International Trade, which found the provision applies only to balance-of-payments crises that cannot normally occur under flexible exchange rates. The administration's Section 301 tariffs face similar challenges, with critics calling the forced-labor justification a sham and arguing the interpretation violates the major questions doctrine and nondelegation principles. The paper also notes Trump's attempt to revive Section 338 of the Smoot-Hawley Act, a provision never used before, which may be superseded by later law.
Despite the legal vulnerabilities, the paper warns that tariffs can still cause serious harm while cases wind through the courts. It points out that the IEEPA tariffs collected some $166 billion before being stopped, and refunds remain incomplete. The author suggests Canada should work with American opponents of the tariffs to push for new legislation, possibly including a revised CUSMA, that would clearly bar future presidents from imposing tariffs unilaterally. The source is a single opinion piece, so no contrasting views are presented within it.}