The Supreme Court’s decision on Trump tariffs will have lasting impact on US economic statecraft
On September 9, the Supreme Court granted the Trump administration’s request to consider on an expedited basis its appeal of a lower court ruling that invalidated most tariffs imposed under the International Emergency Economic Powers Act (IEEPA). The decision came two weeks after the US Court of Appeals for the Federal Circuit affirmed a ruling by the US Court of International Trade (CIT), finding that while IEEPA provides the president with certain powers “to deal with any unusual and extraordinary threat, which has its source in whole or substantial part outside the United States,” the law does not grant the executive the kind of “unbounded authority” necessary to impose tariffs—a power that the Constitution expressly reserves for Congress.
Regardless of how the Supreme Court rules, the case will shape US economic policy for years to come—and its effects will reach far beyond tariffs. After all, IEEPA serves not only as the legal foundation for most sanctions but also underpins other recent tools of economic statecraft such as the outbound investment program, data security restrictions, and controls on information and communication technology.
A tough call for the Supreme Court
A threshold question for the Supreme Court will be how much deference to give the president in matters of foreign affairs and national security. The court’s conservative majority is typically reluctant to second-guess executive power in these spheres, particularly when Congress has delegated authority to the president under a sweeping law like IEEPA. In that sense, invalidating Trump’s tariffs—a cornerstone of his 2024 campaign—would represent an unusually high-profile rebuke of the administration.
At the same time, upholding these tariffs could be viewed as a dramatic expansion of presidential power, allowing future presidents to sidestep Congress on the pretense of a national emergency. Trump’s aggressive use of IEEPA has faced challenges before. For instance, several courts rejected the first Trump administration’s broad ban on the Chinese social media platforms WeChat and TikTok under IEEPA, rebuking the executive branch’s interpretations of the law. In fact, the Supreme Court—with its landmark decision in Loper Bright Enterprises v. Raimondo, which upended long-standing “Chevron deference” to agency interpretations of statutes—has signaled that the executive’s broad statutory interpretations may face serious limits. Even if the court upholds Trump’s tariffs, these cases create a roadmap for future plaintiffs to challenge policies justified under IEEPA.
The tariffs will remain in place—for now
Several factors should give the Trump administration reason for optimism, though. For one, the Federal Circuit’s decision was far from unanimous: Four judges dissented, arguing that IEEPA “embodies an eyes-open congressional grant of broad emergency authority.” Although they agreed with part of the lower court’s reasoning that a president’s determination of an “unusual and extraordinary threat” should not escape judicial scrutiny, they held that Congress drafted IEEPA broadly to empower decisive presidential action in foreign affairs—a view some Supreme Court justices might share.
Moreover, Congress—while able to seriously limit the president’s tariff powers, as proposed in the Trade Review Act of 2025—could also choose to expand them (a request Trump made in his 2019 State of the Union address). Specifically, it could expand presidential authority under IEEPA, as it did recently by extending the statute of limitations from five to ten years. Although Congress passed IEEPA to rein in presidential emergency powers, the executive’s authority under the law has steadily increased. Congress’s procedural checks on the president under IEEPA have become pro-forma exercises that attract little attention or debate.
And even in a scenario in which the Supreme Court finds that the administration’s broad interpretation of its authority under IEEPA is an overreach, it is far from game over for Trump. He would still have plenty of other legal avenues at his disposal to enact tariffs—including Section 301 of the Trade Act of 1974 and Section 232 of the Trade Expansion Act of 1962—though procedural requirements may blunt their immediate impact.
National battles, international stakes
No matter the outcome of the tariff tussle, a larger truth persists: The tools of US economic power are only as effective as the legal and financial frameworks that support them. How the Supreme Court rules could shape not only Trump’s tariffs but also US influence in an increasingly competitive global economy. For a country that has relied on economic warfare for decades to fight some of its most important geopolitical battles, legal uncertainty poses a significant challenge. Success in this arena depends on primacy in international finance, technology, and trade. Especially at a time when US competitors are seeking to redraw the global trade map, effective economic statecraft—including sanctions, export controls, and investment restrictions—has never been more critical.
Fortunately, the United States still has plenty of economic juice left in the tank to succeed in a more transactional and weaponized global economy. That gives a new generation of US leaders the chance to make a case to the American people—who will pay the price for such measures— that more rules are needed for the future of economic warfare.
Stephanie Connor is a contributor with the Atlantic Council, a former senior official with the Office of Foreign Assets Control, and a current partner at Holland & Knight LLP.
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Economic Statecraft Initiative
Housed within the GeoEconomics Center, the Economic Statecraft Initiative (ESI) publishes leading-edge research and analysis on sanctions and the use of economic power to achieve foreign policy objectives and protect national security interests.
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