GMU Econ alum Caleb Petitt ponders the ruling in Learning Resources v. Trump. A slice:
The IEEPA tariffs were bad because they were unconstitutional, but they were also bad politically and economically. They were incapable of achieving their stated ends, they fostered graft and corruption, created uncertainty, were based on the faulty notion that trade deficits are bad, put a regressive tax on ordinary Americans, drove a wedge between our America and her allies, and slowed economic growth. Removing these tariffs will bring more life, order, and growth to the American economy.
Also exploring the implications of the Learning Resources ruling is John O. McGinnis.
Gary Clyde Hufbauer asks: “How will Trump’s new 15 percent tariff fare in court?” Here’s his conclusion:
Finally, Section 122 reads in part that limited, temporary import restrictions can be employed “to cooperate with other countries in correcting an international balance-of-payments disequilibrium.” There is no such ongoing international cooperation.
My PIIE colleague Alan Wm. Wolff wrote recently about the major limitations of Section 122 and other statutes (Sections 338, 122, 232, and 301) that Trump will likely use as authority for new tariffs. The Supreme Court’s ruling implies that Trump will face serious legal challenges as he invokes these statutes as instruments to raise substantial revenue through tariffs, rather than as instruments to address specific foreign practices.
Trade is not just about transactions. It’s about relationships and trust built and earned over time. This establishes that trading partners will play by agreed-upon rules and that market access is not a bargaining chip to be leveraged whenever one side, in this case Washington, needs a political victory.
Adam Smith understood this. He knew that the wealth of nations wasn’t built on clever tariff schedules or trying to hold the rest of the world hostage. It’s built on expanding the division of labor, broadening the extent of the market, and enabling man’s propensity to “truck, barter, and exchange.” All these things are made possible by stable rules and predictable networks of exchange. Smith understood that tariffs altered these incentives, but even he may have underappreciated the role of trust in international trade, how quickly it can be eroded, and what happens when it is.
Rather than breathing a sigh of relief after the Court’s ruling, the rest of the world is getting further confirmation that this administration, and by extension the United States of America, is no longer trustworthy. The first trade deals of 2026 have included deals meant to limit the damage that can be done by the turn away from trade by the United States. Canada and China announced a “trade reset,” with the Canadian prime minister, Mark Carney, referring to China as “more predictable” than the United States. When China, of all places, is viewed as more predictable than the US, something has gone very, very wrong.
“Trump’s tariffs have not shifted the trade deficit” – so reports Timothy Taylor.
GMU Econ alum Romina Boccia makes clear that “America can’t tariff its way out of this debt crisis.”
Jeremy Horpedahl again busts the zombie myth that the real incomes of American families haven’t increased substantially over the past few decades. Here’s his conclusion:
The gains in real median household or family income since the 1970s are not being distorted in any major way. Total hours of work didn’t double in the household — they increased modestly, by about 12 percent at the mean and 39 percent at the median. And this increase stopped after the Boomer generation (roughly in the mid-1990s). Furthermore, we can adjust household income for these increases, whereby we see a rise of 26-38 percent, not a fall of 40-50 percent as Mr. Tucker claims.
In a 2013 study with Paul Heaton, Steven Levitt and Kevin Murphy, I measured what crack cocaine did to black communities in the 1980s and ’90s. With the rise of crack, homicide rates doubled among black males 14 to 17 while fetal deaths among blacks sharply increased. Yet even as crack use persisted at 60% to 75% of its peak level through 2000, the violence almost disappeared. The initial violence was driven not by drug use but by the struggle to establish property rights in illegal markets. Once those rights were established and crack prices fell, the violence subsided. The carnage of the crack epidemic wasn’t an argument for prohibition. It was an indictment of it.
“Do immigrant cultures threaten liberty?”
