At Civitas, John Yoo: The Court of International Trade Issued a Deeply Flawed Tariff Ruling. From the introduction:
Opponents of the administration’s unprecedented trade war celebrated last week’s decision by the U.S. Court of International Trade (CIT). The CIT held that President Donald J. Trump could not use the International Emergency Economic Powers Act to set worldwide tariffs, retaliatory tariffs, or impose specific rates on imports from Mexico, Canada, or China to address drug trafficking, crime, and terrorism.
“The Worldwide and Retaliatory Tariff Orders exceed any authority granted to the President by IEEPA,” the Court announced. “The Trafficking Tariffs fail because they do not deal with the threats set forth in those orders.”
But critics may want to pause uncorking the champagne (no doubt bought before Trump’s initial 10 percent worldwide tariff, which then increased to 50 percent, then was temporarily suspended). A careful reading of the CIT’s decision in V.O.S. Selections Inc. v. United States reveals a flawed decision that improperly intrudes into national security affairs and fails to grapple with the profound constitutional issues at stake.
I share the view of critics that the trade deficit does not amount to an actual national emergency and that tariffs make no economic sense. In the interests of full disclosure, I serve on the board of the Pacific Legal Foundation, which is representing small businesses in the delightfully named case of Princess Awesome & Stonemaier Games v. Customs – in a separate suit against the Trump tariffs. But if the federal appeals court upholds VOS on the grounds given by the CIT, the decision will do more harm to the separation of powers and our constitutional system than it will be worth. A federal court could still block Trump’s trade war, but not for the reasons given in VOS.
And from later on:
… [T[he [CIT] misunderstands the different constitutional frameworks that govern foreign versus domestic affairs. And … it fails to acknowledge the major Supreme Court precedent on point: United States v. Curtiss-Wright Export Corp. (1936). The non-delegation doctrine, according to Curtiss-Wright, does not apply to foreign affairs, and so, consequently, neither would the major questions doctrine. At the time of Curtiss-Wright, the Supreme Court had blocked several of FDR’s New Deal laws for granting excessive legislative power to the executive branch – the very birth of the non-delegation doctrine. But, as the Curtiss-Wright Court explained, “the powers of the federal government with respect of foreign or external affairs and those in respect of domestic or internal affairs [are] different.”
In domestic affairs, the Court observed, the federal government can only exercise those powers “specifically enumerated in the Constitution.” But in foreign affairs, Curtiss-Wright held, Congress’s legislative power can be combined with “the very delicate, plenary and exclusive power of the President as the sole organ of the federal government in the field of international relations.” As a result, the Court held, the non-delegation doctrine did not apply to foreign affairs. “If embarrassment . . . is to be avoided and success for our aims achieved,” Justice Sutherland observed for the Court, “congressional legislation [must] often accord to the President a degree of discretion and freedom from statutory restrictions which would not be admissible were domestic affairs alone involved.”
The Supreme Court has never disavowed Curtiss-Wright. Nor has it ever struck down a congressional delegation of foreign affairs power to the President. Indeed, Curtiss-Wright makes eminent sense. In domestic affairs, problems usually do not suddenly arise that inflict great harm on the nation. Congress and the President have the time and resources to develop policies, and, in the meantime, states, armed with their police powers, can serve as the first line of defense. In foreign affairs, however, problems can assume a dimension of time and magnitude that may require an immediate response. In a sudden attack, for example, the nation could suffer significant harm from an enemy. Even more long-standing problems may require a level of secrecy, speed, and decisiveness (to borrow from Alexander Hamilton’s description of the presidency in Federalist 70) to protect the nation. Congress’s ability to anticipate future circumstances will be far more limited in foreign affairs than in domestic affairs. And finally, states have no significant role in foreign affairs; they cannot attack these challenges while the federal government deliberates.
The CIT’s failure to address whether the non-delegation doctrine even applies to foreign affairs is a glaring mistake that could easily open the way for Trump to prevail on appeal. The CIT’s second holding compounds this failure: its rejection of the narrow “Trafficking Tariffs.” Regardless of whether one believes Congress did not intend to delegate to the President the power to set worldwide tariffs in IEEPA, it seems indisputable that Congress wanted to give the executive the power to target individual countries with economic sanctions. In fact, IEEPA grandfathered in embargoes on countries that existed at the time of its passage. If IEEPA allows a complete economic embargo of Cuba, for example, it should also permit a less aggressive use of that same power, such as a tariff on trade with Cuba.
In this respect, the CIT held that the trafficking tariffs failed because they “do not ‘deal with’ their stated objectives.” IEEPA grants the President broad powers, the three judges argued, so that he can “deal with” – Congress’s words – the national security emergency. The CIT held that tariffs do not have a direct link to the failure of China, Mexico, and Canada to stop drug trafficking into the United States. At best, they only create leverage for the United States to negotiate. If the President can use IEEPA “to permit any infliction of a burden on a counterparty to exact concessions,” the court reasoned, “then everything is permitted.”
VOS intrudes into foreign policy in a manner no federal court has ever done before. It claims the federal courts' ability to judge for themselves whether a chosen foreign policy effectively achieves its goals. Courts do not have access to information or the competence to make such difficult judgments. In Curtiss-Wright, the Supreme Court emphasized the executive branch's authority to make such foreign policy decisions. The President “has the better opportunity of knowing the conditions which prevail in foreign countries, and especially is this true in time of war. He has his confidential sources of information. [Secrecy] in respect of information gathered by them may be highly necessary.” But under VOS, federal courts are now to sit in judgment over whether the President has chosen the most effective means to achieve its goals. Trade sanctions on Cuba of various sorts have existed since the 1959 Cuban Revolution; nevertheless, the United States has failed to dislodge the regime of Fidel Castro and his successors from power. Will the CIT next strike down US trade sanctions on Cuba because they have failed to “deal with” the regime in Havana? Or will it invalidate economic sanctions on Iran because they have failed to stop Tehran’s march toward nuclear weapons? These questions demonstrate how seriously VOS extends the federal courts into foreign affairs areas where they are not competent.
I have related thoughts here, as does Jack Goldsmith (linked here). This is a harder issue than the CIT seemed to acknowledge, although I have some sympathy for its conclusion.
Posted at 6:55 AM