From Op-Ed to Supreme Court
How an economic argument changed the terms of the tariff debate
In 2025, President Trump used emergency powers to impose sweeping tariffs. The resulting court cases raised a fundamental question: How much economic power can a president exercise without Congress?
One part of the government’s case rested on what looked like a technical distinction. Justice Department lawyers argued that Section 122 of the Trade Act did not apply because it dealt with balance-of-payments deficits, not trade deficits.
That distinction struck me as economically wrong. Marc Busch of Georgetown University and I made the argument publicly in an August 2025 Council on Foreign Relations op-ed, “Trump’s Lawyers Are Wrong About Section 122.” Our point was simple: in the United States, trade deficits and balance-of-payments deficits move together.
Trade balance and balance of payments move together
United States, 1960–2024, percent of GDP
Source: US Bureau of Economic Analysis; author’s calculations. Trade balance includes goods and services. Balance of payments here is the current-account plus capital-account balance. Negative values indicate deficits.
From an op-ed into the Supreme Court case
The argument did not remain on the op-ed page. A Supreme Court brief by leading scholars of international trade developed the point in much greater depth, combining the economics, the history of the statute and the data.
By the time the Justice Department filed its Supreme Court brief, it was no longer relying on the distinction we had challenged. The businesses challenging the tariffs then relied explicitly on the Trade Scholars brief in their own Supreme Court argument.
An economic argument first made publicly in an op-ed had become part of the way a major Supreme Court case was being argued.
Why it mattered
This was never just about tariffs. Congress had already decided how much tariff authority a president should have in this situation and had written explicit limits into law.
If a president can avoid those limits simply by invoking a broader emergency statute, then congressional limits cease to be real limits.
The principle reaches far beyond trade. If the executive can treat laws enacted by Congress as optional whenever emergency powers are invoked, power shifts from the legislature to the presidency.
Taken far enough, that changes the nature of a presidential system. Congress may still pass laws, but the executive increasingly decides which constraints actually bind. That is a pathway away from constitutional government and toward autocratic rule.
In February 2026, the Supreme Court held that the International Emergency Economic Powers Act did not authorize the President to impose tariffs.
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