Supreme Court justices skeptical of president’s use of emergency powers

At one point, liberal judge Sonia Sotomayor interrupted: “Can you answer the judge’s question?” Sotomayor asked why Congress used the term “regulation and taxation” in relevant statutes, implying that regulation is separate from taxation.

Sauer said tariffs should not be viewed as taxes. “It is the power to regulate foreign trade. These are regulatory tariffs; they are not revenue-raising tariffs. It is only incidental that they increase revenue.”

Chief Justice John Roberts, a moderate conservative appointed by former president George W. Bush, disputed that claim, noting that the government boasted about deficit-reducing tariffs.

“I would say this increases revenue domestically,” he said.

Roberts also questioned the government’s assertion that Trump’s authority stems from his broad authority to make foreign affairs decisions.

“Of course, tariffs are agreements with foreign powers. But the tool is to tax Americans, and that has always been the primary power of Congress,” Roberts said.

“The fact that the president’s foreign affairs authority trumps this fundamental authority for Congress, it seems to me, at least ensures neutrality between the two powers, the executive power and the legislative power.”

When Sauer rejected the claim that Americans were paying the tariffs, Roberts asked: “So who pays the tariffs? If a tariff is imposed on automobiles, who pays them?” Sauer said it will depend on the situation.

Neal Katyal, an attorney representing businesses challenging the tariffs, later told the court that the tariffs should indeed be considered taxes and that the case was based on common sense, beyond existing legal doctrines.

“[Tariffs] Take dollars out of Americans’ pockets and deposit them in the US Treasury. “Our Founders gave this taxing power to Congress,” he said. “If the government wins this case, we will never get that authority back.”

Katyal questioned why a friendly country with which the United States has a trade surplus was subject to a 39 percent customs duty, specifically referring to Switzerland. “This is something no president in our history has had the authority to do,” he said.

But Katyal was also questioned by judges who were skeptical of the businesses’ claims. Roberts said that while the tariffs are certainly a tax, they are an outward-looking tax that Trump uses internationally.

“One thing is pretty clear: Tariffs on foreigners have been quite effective in some cases at achieving certain goals,” Roberts said. “This directly implies that: [president’s] foreign relations power.”

Katyal acknowledged that tariffs have implications for foreign policy, but argued that the nation’s founders delegated that authority solely to Congress.

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Justice Samuel Alito, also a Bush appointee, compared the situation to a crowded national park. If Congress passed a law allowing the National Parks Service to “regulate access” to the park, Alito asked, wouldn’t it allow NPS to charge a fee?

Katyal said that would be fine if the fee only covers the cost of operating the park but does not increase revenue.

The Supreme Court is expected to rule on the issue relatively quickly, possibly within a few weeks and possibly before Christmas.

Trump described the case as “literally LIFE or DEATH” for the United States. “With a Victory we have a tremendous but fair Financial and National Security,” he wrote on social media. “Without it, we are almost defenseless against other countries that have been taking advantage of us for years.”

The president was so focused on the case that he had previously expressed interest in attending the hearing in person. But instead he flew to Miami to give the keynote address at the American Business Forum.

While the loss is a significant setback for the Trump administration, it has other legal tools at its disposal — other than emergency powers — that it can use to reimpose many of the tariffs.

The court was not considering the legality of sectoral tariffs imposed under different laws, such as those on steel, aluminium, copper and pharmaceuticals.

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