Trump’s Tariffs Head to the Supreme Court bölümünün tam dökümü

the president, and in most cases, the statutes are really specific. 00:02:06.489 --> 00:02:15.408 You know, if imports threaten national security or if imports are causing undue injury to domestic firms, and you know, there's some leeway with what those. 00:02:16.088 --> 00:02:17.049 Phrases mean. 00:02:17.239 --> 00:02:20.359 But in most cases there's a process that's pretty well spelled out. 00:02:20.729 --> 00:02:36.264 But this law that you refer to a EPA from 1977 is an emergency powers kind of law for the president that doesn't actually mention the word tariff in it and from when it was passed in the seventies. 00:02:36.614 --> 00:02:46.153 Up until before Trump came back into office, this law had been used for 67 different emergencies, but had never been used to impose tariffs. 00:02:46.454 --> 00:02:53.574 So Trump is really pushing the bounds of what this statute allows by using it to impose baseline tariffs. 00:02:53.873 --> 00:02:59.093 And you'll recall as we've talked about on the show before, there are two buckets of IEP tariffs. 00:02:59.283 --> 00:03:01.683 The first are related to a national emergency. 00:03:02.074 --> 00:03:08.123 Fentanyl and border crossings and those are tariffs on China, Mexico, and Canada. 00:03:08.454 --> 00:03:19.234 And then the other bucket are these reciprocal tariffs that were, you know, an idea supposed to be matching trade barriers that other countries impose on the us but really are. 00:03:20.104 --> 00:03:23.193 random numbers that you don't really know where they're coming from. 00:03:23.433 --> 00:03:28.294 They range from 10% to 50% and apply to almost every US trading partner. 00:03:28.653 --> 00:03:33.354 So rather than these being really narrowly targeted measures related to. 00:03:35.028 --> 00:03:37.308 and time-limited national emergencies. 00:03:37.579 --> 00:03:39.438 These are just really broad tariffs. 00:03:39.438 --> 00:03:46.848 The president has used this statute to impose his idea of baseline tariffs, is essentially what we're talking about. 00:03:47.209 --> 00:03:52.549 And all these tariffs add up to, like you said, about$2.3 trillion in taxes over the next. 00:03:52.554 --> 00:03:53.243 Decade. 00:03:53.243 --> 00:03:58.163 So that's a 10 year measure of how much revenue could be expected if these tariffs remain in place. 00:03:58.574 --> 00:04:02.183 But if the Supreme Court strikes it down, of course that revenue would go away. 00:04:03.123 --> 00:04:11.234 That brings me to Alex we've already seen billions of dollars collected, I believe, the total from I EPA tariffs so far. 00:04:11.234 --> 00:04:13.813 This calendar year is getting close to$90 billion. 00:04:15.058 --> 00:04:16.379 But who actually pays those tariffs? 00:04:16.619 --> 00:04:22.199 If we hear President Trump talk about it, you know, he'll say This is a tariff on China, this is a tariff on Canada. 00:04:22.199 --> 00:04:23.908 We're gonna make Canada pay more. 00:04:24.158 --> 00:04:29.678 But what does the

research show so far about who is paying and how these are burdening different people? 00:04:29.978 --> 00:04:31.483 Right, so the research shows. 00:04:31.543 --> 00:04:37.483 Those, that's a combination of both consumers and American businesses that are paying the tariffs. 00:04:37.533 --> 00:04:42.819 So the administration likes the claim that it's actually foreign firms that have been paying the tariffs. 00:04:42.819 --> 00:04:45.158 But that's in fact not the case. 00:04:45.209 --> 00:04:47.889 So we have pretty good data showing that the tariffs. 00:04:48.139 --> 00:04:58.788 Themselves are almost fully passed on to the import price that the importer's paying, which in many cases is going to be that importing firm and business. 00:04:59.209 --> 00:05:10.038 And then once that transaction happens then the firm has a decision to make, which is how much of that cost increase do they want to pass on to the final consumer? 00:05:10.408 --> 00:05:18.718 And what we've seen so far is that the burn of the tariff is being shared by both that business and the final consumer. 00:05:18.718 --> 00:05:31.137 So, the latest evidence that just came out, and this is from a team of Harvard economists and they have looked specifically at tariff pass through to that final retail price. 00:05:31.466 --> 00:05:36.507 And what they found is that about 20% of those tariffs have been passed on to. 00:05:37.187 --> 00:05:38.237 final consumer. 00:05:38.237 --> 00:05:44.687 And that itself has had about 0.7 percentage points to the consumer price index. 00:05:44.987 --> 00:05:53.076 Now, initially that might not sound like a whole lot, you know, because as you said, Erica, you know, we've seen tariffs as high you know, as 50% say on Brazil and India. 00:05:53.302 --> 00:05:57.531 So, so the question is, I mean, why are we not even seeing more price spikes? 00:05:57.531 --> 00:06:08.002 And I think the reason for this, and this is coming from a lot of the survey evidence that we have of businesses, is that there's a lot of uncertainty around the tariff regime. 00:06:08.192 --> 00:06:14.492 A lot of these businesses you know, they operate on a contract basis, they might have already locked in some of their prices for the year. 00:06:14.492 --> 00:06:18.851 So they're gonna be shifting those price increases until next year. 00:06:19.141 --> 00:06:25.072 So, so I think while we have you know, we've seen some, you know, as I said, some modest price impacts so far. 00:06:25.432 --> 00:06:35.831 And I think given the evidence that we've seen, you know, from the surveys as well, that we should be expecting more price increases going forward especially as we head into the holiday season. 00:06:35.831 --> 00:06:37.242 Now, of course, this is all assuming. 00:06:37.922 --> 00:06:41.252 That the Supreme Court, you know, upholds, you know, the ie, but tariffs. 00:06:41.252 --> 00:06:46.692 And if they don't you know, then we're going to see a lot of additional you know, pricing decisions. 00:06:46.692 --> 00:06:54.041 That, that will have to be made there because there will still be a lot of tariffs left in place under under other authorities. 00:06:54.322 --> 00:06:57.232 But in, in that situation those IEP tariffs would go away. 00:06:58.081 --> 00:07:01.541 I saw a really interesting article this week on bananas. 00:07:01.762 --> 00:07:06.351 You know, if you look at banana prices over like the past decade or so, they're really steady. 00:07:06.562 --> 00:07:13.012 But since April, banana prices have increased by more than 5%, which is because of the tariffs. 00:07:13.201 --> 00:07:13.711 So I think. 00:07:13.976 --> 00:07:18.447 In addition to these differences over timing, like, are the tariffs gonna be here, are they not? 00:07:18.447 --> 00:07:19.737 Do we change our price or not? 00:07:19.976 --> 00:07:22.197 You also see a lot of variation in different products. 00:07:22.197 --> 00:07:25.646 You know, some of it depends on can we get any of it from the United States? 00:07:25.797 --> 00:07:27.867 Can it be stockpiled in the case of bananas? 00:07:27.867 --> 00:07:29.096 Like no and no. 00:07:29.096 --> 00:07:36.187 So we're seeing that pricing change show up faster than we do for other products where there may be more ability to have some kind of a buffer. 00:07:36.336 --> 00:07:38.637 Bananas are a really good example here for a couple reasons. 00:07:38.666 --> 00:07:43.887 I mean, one is that you just see the clearest, you know, trend break in the data from when the tariffs were opposed. 00:07:43.887 --> 00:07:46.737 And there was no other obvious explanation. 00:07:46.737 --> 00:07:51.476 Like there was no other, you know, supply shock that occurred that would cause bon banana prices to rise. 00:07:51.747 --> 00:08:01.737 And I think the second reason, that's a good example is that you know, if you're able to shift, some of your production to the US that does attenuate, the price increases somewhat. 00:08:01.797 --> 00:08:06.057 Of course it would not be as low as they would be if the tariffs weren't imposed. 00:08:06.086 --> 00:08:10.846 But in the case of bananas 98% of bananas that we consume in the US are import. 00:08:10.877 --> 00:08:13.307 We can't just produce more bananas. 00:08:13.307 --> 00:08:21.757 So, so in that situation you know, consumers, they, I, if they really like bananas, you know, they really have, no choice, but they just pay that, that higher price. 00:08:21.757 --> 00:08:22.956 And of course they could switch. 00:08:23.266 --> 00:08:25.187 to other kinds of fruits as well. 00:08:25.187 --> 00:08:28.107 But, you know, again, those are also facing tariffs. 00:08:28.107 --> 00:08:36.326 So I think that's like one, one example where it's really, I think, pretty difficult for consumers to insulate themselves from those price increases. 00:08:36.667 --> 00:08:39.701 Yeah, if your toddler loves bananas you've gotta pay the higher price. 00:08:40.537 --> 00:08:41.767 Exactly, and you know.

00:08:42.542 --> 00:08:47.971 I actually, I have a personal story about tariffs affecting my life that I saw very recently. 00:08:48.331 --> 00:08:53.792 I have a small obsession with Converse, and Converse is actually made better when you buy them from Japan. 00:08:53.792 --> 00:08:59.072 It's a different company that makes them, so if you buy Converse from Japan, it's a really high quality shoe. 00:08:59.491 --> 00:09:06.302 I bought them and it was like 130 bucks, and then it got delivered to me and. 00:09:06.782 --> 00:09:14.072 I then got an email being like I had to pay$60 on top of that, which were in additional tariffs, and I didn't know that. 00:09:14.131 --> 00:09:17.971 I had no idea, but it just, but I paid it, like they didn't pay it. 00:09:18.001 --> 00:09:18.601 Nobody else paid. 00:09:18.719 --> 00:09:19.288 Apparel. 00:09:19.288 --> 00:09:26.589 I would say that's a really good example because, you know, as Eric had mentioned, I mean, there's, so there's certain kinds of goods where we've seen more price increases than others. 00:09:26.589 --> 00:09:32.839 And apparel has had one of the largest price increases a as a result of the tariffs. 00:09:32.869 --> 00:09:34.999 So yeah I'm not, I am not surprised to hear that. 00:09:34.999 --> 00:09:36.708 That was your your personal experience. 00:09:37.203 --> 00:09:43.083 Yeah, and that's probably due to another change that was made under A EPA, which was ending di minimis. 00:09:43.354 --> 00:09:53.229 So prior to that change, if you had a like low value package coming in, I think$800 or less that essentially just skipped through the customs process. 00:09:53.229 --> 00:09:55.239 There wasn't a tariff or anything like that applied. 00:09:55.854 --> 00:09:59.124 Trump has ended di minimis under the IEPA statute. 00:09:59.124 --> 00:10:06.453 And so all of these small dollar packages, like the$130 shoes you bought now get a tariff bill slapped on. 00:10:06.793 --> 00:10:12.244 And given that tariff rates are pretty high right now, that is a relatively large amount of revenue. 00:10:12.464 --> 00:10:21.583 But if you look at like the administrative hassle of looking through all of these like single purchases, these little packages that are coming through, that's a huge administrative cost. 00:10:21.658 --> 00:10:24.698 To the government for probably very little revenue squeeze. 00:10:25.109 --> 00:10:30.149 Yeah, and I will say I believe what I read in my email, and this could be wrong, but was it. 00:10:30.399 --> 00:10:33.158 eBay, they're paying it first and then I'm paying them. 00:10:33.158 --> 00:10:35.678 So they have to put out money and then I have to pay them. 00:10:35.678 --> 00:10:39.308 And that's like a whole thing that it's just a complicated, messy process. 00:10:39.359 --> 00:10:41.068 It's not simple like you guys are saying. 00:10:41.068 --> 00:10:42.778 And it affects us Americans. 00:10:43.109 --> 00:10:46.729 But real quick, let's, let's transition here to talking about the court fight. 00:10:46.729 --> 00:10:48.948 That this sort of legal battle that's gonna go on. 00:10:49.264 --> 00:10:58.884 You know, uh, Alex, to you, you know, what are the plaintiffs actually arguing and what makes this case such a fundamental test for presidential authority under a epa. 00:10:59.448 --> 00:10:59.719 Right. 00:10:59.719 --> 00:11:07.528 Well, the plans are simply arguing that the I, the, i, the IEP authorities do not grant the president the authority to impose tariffs this broad in scope. 00:11:07.578 --> 00:11:16.328 You know, as Erica mentioned earlier if you look at the statute not only does it not use the word tariffs, but it doesn't use any other words that are sort of synonymous with tariffs like duty or taxes. 00:11:17.099 --> 00:11:29.359 So it seems to be the, and actually the other thing I think is important to highlight here is that the, you know, Congress around that time did pass certain statutes granting the President Moore executive authority to impose tariffs. 00:11:29.359 --> 00:11:31.068 So the question really is, if. 00:11:31.489 --> 00:11:33.678 A EA was intended. 00:11:33.719 --> 00:11:36.298 And again, a EA came, you know, in, in the late seventies. 00:11:36.298 --> 00:11:46.359 I mean, if it really was intended to give the president the authority to impose tariffs this broad, it would be sort of redundant with respect to the other powers they gave the President. 00:11:46.438 --> 00:11:54.149 And if you look actually, you know, e Eric had mentioned that, you know, IPE had been used many times throughout the past several decades. 00:11:54.369 --> 00:11:55.269 If you look at the cases. 00:11:56.224 --> 00:11:57.647 you know where it was used and how it was used? 00:11:57.697 --> 00:12:02.413 It was mostly related to freezing assets of uh, foreign adversaries. 00:12:02.413 --> 00:12:09.933 In fact it was first applied by Jimmy Carter during the Iran hostage crisis specifically to freeze Iranian assets. 00:12:10.153 --> 00:12:10.903 So this is a very. 00:12:11.599 --> 00:12:16.178 Narrow different circumstance from imposing tariffs. 00:12:16.249 --> 00:12:29.484 You know, that, that were this broad in scope and I think the government is going to have a really difficult time arguing that it was the intention of Congress when they passed these, you know, emergency powers to give the president authorities that were that broad. 00:12:30.754 --> 00:12:36.749 And I think another issue that, that some of the arguments have brought up are that, you know, this has to be related to a national emergency. 00:12:37.438 --> 00:12:41.099 I forget the exact language, but in the statute it's like, it's a time sensitive thing. 00:12:41.099 --> 00:12:46.168 It's like something that pops up and will end because of the actions that you take. 00:12:47.158 --> 00:12:53.698 of the national emergencies is that the US is running a trade deficit, but the US has been running a trade deficit for more than my entire lifetime.

00:12:53.698 --> 00:12:55.019 So that's like not some new. 00:12:55.823 --> 00:12:58.254 Emergency that just popped up, that needs to be addressed. 00:12:58.254 --> 00:13:00.083 This is like a longstanding issue. 00:13:00.413 --> 00:13:05.994 So even if you like, ignore the part about tariffs, just the national emergencies that have been declared don't match up. 00:13:06.288 --> 00:13:15.833 And, and that argument, I think, becomes even harder for the government to defend because under the reciprocal tariff regime, they're imposing tariffs of countries that we even have trade surpluses with. 00:13:16.028 --> 00:13:20.035 I, I think the government, you know, in that sense, doesn't really have, a a leg to stand 00:13:20.182 --> 00:13:27.947 Yeah, and, and I wonder, you know, especially I think the president might not be helping his case with maybe raising tariffs because of a commercial, potentially. 00:13:27.947 --> 00:13:30.288 Things like that certainly, probably don't help as. 00:13:31.307 --> 00:13:31.817 Well, right. 00:13:31.817 --> 00:13:39.668 I mean, just to get into that example, you know, the first round of tariffs that came in February were specifics that were, so those were the tariffs on Canada, Mexico, and China. 00:13:39.668 --> 00:13:49.937 And those were, allegedly supposed to address fentanyl coming through the border, as well as you know, the immigration crisis and border crossings, you know, that we were experiencing earlier in the year. 00:13:50.238 --> 00:13:56.148 And now the president just over the weekend says he wants to impose, you know, an additional 10% tariff on Canada as he was offended by a commercial. 00:13:56.148 --> 00:13:56.807 I mean, how does that. 00:13:57.822 --> 00:13:59.712 to the fentanyl and border crisis. 00:13:59.743 --> 00:14:00.072 Right. 00:14:00.072 --> 00:14:09.261 So, I think it is very unlikely that the intention was for the president to be able to impose tariffs because he was offended by a TV commercial. 00:14:10.317 --> 00:14:10.496 Yeah. 00:14:10.496 --> 00:14:21.836 And I think, um, you know, Alex, on a different podcast that you were on a, a few months ago when we were talking about a little bit of crony capitalism, like that's kind of a little bit the vibe where you're like, oh, like, it's a little concerning when you get to that point. 00:14:22.136 --> 00:14:22.376 Right. 00:14:22.376 --> 00:14:24.297 But, you know, o over to you Eric. 00:14:24.297 --> 00:14:25.647 Uh, I wanna do a little bit of. 00:14:25.662 --> 00:14:34.121 F forecasting with you, you know, if the Supreme Court rules one way or another, you know, how quickly might we see the real world effects for businesses and consumers? 00:14:35.371 --> 00:14:46.522 Yeah, so there's been a lot of speculation about, you know, if the Supreme Court strikes these tariffs down they could require refunds being paid to anyone who has paid an IEPA tariff. 00:14:46.892 --> 00:14:56.761 So then it becomes a process question, does the government make this a taxpayer friendly refund situation or do they make you jump through a lot of hoops? 00:14:57.042 --> 00:14:59.142 But you know, there is a world where. 00:14:59.451 --> 00:15:02.062 Importers who have paid tariffs get their money back. 00:15:02.331 --> 00:15:03.471 That raises questions too. 00:15:03.471 --> 00:15:06.442 Then what if those importers had raised their prices? 00:15:06.442 --> 00:15:08.121 Do they get some sort of windfall? 00:15:08.422 --> 00:15:12.682 Do prices come down after there's all of these knock on effects from refunds. 00:15:13.807 --> 00:15:19.856 There's also a question of like, how much does this really improve certainty for for the economy? 00:15:20.126 --> 00:15:25.856 'cause on the one hand, if the Supreme Court says no, the president cannot use a EPA to impose tariffs. 00:15:26.106 --> 00:15:33.277 All of this system we've built up of these reciprocal tariffs of these fentanyl tariffs comes crashing down, but mean the threat of higher tariffs. 00:15:33.297 --> 00:15:41.157 Has gone away, it probably means the president is going to try to impose them through other channels or try to get Congress to do something on tariffs. 00:15:41.606 --> 00:15:45.256 So we're not really in a world of a better trade outlook. 00:15:45.256 --> 00:15:48.256 We're just in a world of, okay, this channel has gone away. 00:15:48.287 --> 00:15:56.177 We're maybe getting refunds of this, you know, 89 billion or so that has been paid in, but we don't really know what's happening next. 00:15:56.476 --> 00:16:02.057 And just to follow up on that, you know, thinking about what comes after, you know, a EPA, if the tariffs are struck down. 00:16:02.102 --> 00:16:06.432 well there's currently 12 ongoing section 2, 3, 2 investigations. 00:16:06.432 --> 00:16:12.133 the section 2 3 2 authority gives the president the ability to pose tariffs up and the interest of national security. 00:16:12.163 --> 00:16:15.482 And those are product focused tariffs. 00:16:15.482 --> 00:16:19.302 So, so the latest ones that have been announced were furniture tariffs. 00:16:19.623 --> 00:16:24.023 There's ones on medium and heavy trucks that are gonna be coming November 1st. 00:16:24.023 --> 00:16:31.613 And then throughout the year we had section 2, 3, 2 tariffs imposed on auto steel and aluminum and and certain derivatives of copper. 00:16:31.893 --> 00:16:34.653 So there's still a lot of you know, investigations. 00:16:34.653 --> 00:16:41.062 There, there is, you know, a strong likelihood that you know, tariffs will be on those products down the road. 00:16:41.062 --> 00:16:41.663 And then. 00:16:41.857 --> 00:16:48.368 There's also the possibility that the president could use other authorities that he used when, his first term. 00:16:48.368 --> 00:16:56.927 So this would be the section 3, 3 0 1 tariffs which he used to target China's unfair and discriminatory trade practices. 00:16:57.207 --> 00:17:00.317 He could, you know, we could

potentially see more of those down the road. 00:17:00.677 --> 00:17:19.532 And then finally there, there's a sort of, less used provision by less, I mean actually this was only, I believe, only used once ever, which is a section 1 22 of the 1974 Trade Act, which gives the present the authority to impose broad tariffs up to 15% to address balance of payments and trade deficit related issues. 00:17:19.587 --> 00:17:22.488 Which sounds a lot like the IE the IE reciprocal tariffs. 00:17:22.488 --> 00:17:38.137 However, these tariffs could not be higher than 15% and could only be in effect for 150 days unless congress approve an extension, which I think given all the debates that are going on right now, I think it is pretty unlikely in that situation that they would approve you know, extending those. 00:17:38.137 --> 00:17:38.817 But so. 00:17:39.178 --> 00:17:48.678 Yeah, I do think that the Supreme Court overturning the IE Pitar, I mean, this would significantly hamstring the president's ability to oppose tariffs that broadly. 00:17:48.708 --> 00:18:02.647 But I don't think we would, you know, I don't think we would be quite out of the woods yet because there are so many ongoing related product investigations and it seems likely the president is going to impose more tariffs on those goods down the road. 00:18:02.657 --> 00:18:04.637 And those authorities can be abused too. 00:18:04.667 --> 00:18:08.178 Like if you look at the section 2 32 steel and aluminum tariffs. 00:18:08.208 --> 00:18:08.748 Okay. 00:18:08.748 --> 00:18:17.258 So, you know, like primary steel, we need to have that for national security reasons, even though the Department of Defense has kind of said, no, we've got what we need. 00:18:17.508 --> 00:18:20.823 Well, if you look at what has happened with Section 2 32 tariffs. 00:18:21.448 --> 00:18:28.407 There's been an inclusion process and the tariffs have been applied to derivatives and companies can ask the government to. 00:18:29.667 --> 00:18:31.557 it further to apply to more derivative products. 00:18:31.557 --> 00:18:44.877 So now we're in a spot where instead of just a applying to like the metals themselves, steel and aluminum, the national security steel and aluminum tariffs apply to the aluminum content of tennis rackets and of canoes and of baseball bats. 00:18:45.097 --> 00:18:47.887 Which is so far removed from national security. 00:18:48.218 --> 00:18:49.147 So it just shows like. 00:18:49.853 --> 00:18:51.053 It can be abused. 00:18:51.053 --> 00:18:56.603 It can mushroom beyond just, you know, what you might think is, you know, laid out in the statute. 00:18:56.853 --> 00:18:59.432 So like Alex said we're not really out of the woods here. 00:18:59.432 --> 00:19:02.542 Yeah, and I'm just wondering and if you guys don't wanna go on the record for this, that's totally fine. 00:19:02.542 --> 00:19:11.032 I, I just wonder if either of you have any idea, like, based on what you guys know, like which way the, the court would be leaning or, or there's just no way to know. 00:19:11.032 --> 00:19:12.623 Like, is it just all up in the air? 00:19:12.682 --> 00:19:13.313 What do you guys think? 00:19:13.313 --> 00:19:14.992 I say, I've been watching betting markets. 00:19:15.127 --> 00:19:15.367 Yeah. 00:19:16.192 --> 00:19:22.583 you know, more people think that the tariffs will be struck down than upheld, but like, 00:19:22.928 --> 00:19:23.228 Yeah. 00:19:23.573 --> 00:19:24.053 who knows? 00:19:24.053 --> 00:19:37.163 There's just as many people arguing like, well, maybe the court will rule in favor of this, even though that would kind of be contradictory to other rulings recently on you know, presidential authority, like regarding student loan forgiveness and that sort of thing. 00:19:37.163 --> 00:19:38.897 So it's, yeah, I don't, I don't have good sense., 00:19:39.367 --> 00:19:44.557 if you actually look at the US Court of Appeals decision, which was a seven four decision against the government. 00:19:44.657 --> 00:19:51.938 The seven hour in the majority were comprised of judges that had been a appointed by both Republican and Democrat administrations. 00:19:51.938 --> 00:19:53.827 However, for the four that dissented. 00:19:54.178 --> 00:19:56.458 And that agreed with the government's argument. 00:19:56.458 --> 00:20:02.917 There were also there were two democratically appointed justices and even two Republican appointed justice judges. 00:20:02.917 --> 00:20:07.712 So, meaning that it's you know, you really it's, I think it's really hard to say, 00:20:07.732 --> 00:20:08.022 yeah. 00:20:08.077 --> 00:20:09.462 way, which way it goes. 00:20:09.462 --> 00:20:14.573 I mean, I mean, I do think we have seen instances with at least a couple of justices on the Supreme Court. 00:20:14.573 --> 00:20:20.173 They have been, willing to rule A against the president and limit some of his authority. 00:20:20.182 --> 00:20:26.462 So I am personally somewhat optimistic that the IEP tariffs will be you know, overturned. 00:20:26.462 --> 00:20:30.542 But I think it is, you know, as we said, it's hard to say without any kind of a absolute certainty. 00:20:31.307 --> 00:20:32.538 Have you placed any bets on it? 00:20:32.538 --> 00:20:33.137 Alex 00:20:33.337 --> 00:20:33.968 no. 00:20:34.075 --> 00:20:34.974 Um, My, uh, 00:20:36.107 --> 00:20:36.498 We're not, 00:20:36.708 --> 00:20:36.887 down. 00:20:37.042 --> 00:20:37.637 yeah, yeah, 00:20:37.732 --> 00:20:38.393 You know, that's. 00:20:38.458 --> 00:20:44.863 my, yeah, no my my, my election bet betting days are are in the are in the past for me. 00:20:47.022 --> 00:20:47.323 Yeah. 00:20:47.373 --> 00:20:50.282 My, my fiance I'll just say my fiance would not be happy with me. 00:20:50.282 --> 00:20:50.942 I'll say that. 00:20:53.433 --> 00:21:02.354 All right, so, so if we step back from all of that Alex, what do you think this tells us about, like, the balance of power between Congress and the president and where that's

headed? 00:21:02.354 --> 00:21:10.183 You know, I personally wish we would see Congress step up and vote to pull back some of this power from the president. 00:21:10.183 --> 00:21:17.923 It doesn't seem like that's likely, it's kind of up to the court at this point, but kind of looking a little bit longer term where do you think that the balance will lie? 00:21:17.989 --> 00:21:26.967 So I mean, look, the unfortunate cases as I think we've highlighted this discussion now even without a EPA, under you know, the 74 Trade Act and also the 1962. 00:21:27.326 --> 00:21:30.717 trade Expansion Act, which gave the president his section 2, 3, 2 authorities. 00:21:31.096 --> 00:21:36.416 You know, as a result of those legisl those pieces of legislation, the president does have, broad authority to impose tariffs. 00:21:36.416 --> 00:21:39.207 And that's a choice that Congress made at the time. 00:21:39.237 --> 00:21:42.297 Of course it's a choice that they can choose to undo. 00:21:42.297 --> 00:21:51.977 And I think that given, you know, how we've seen, you know, as Erika these executive powers being abused, I think you know, it's possible that we could see. 00:21:52.366 --> 00:22:01.247 Over the next few years that congress, you know, maybe will try to rescind or return some of that power to the legislative branch. 00:22:01.247 --> 00:22:12.076 Of course, you know, it's also possible that when a new administration comes in, you know, they try to use, those trade powers to continue to do tariffs, you know, in the more limited scope than what's happening now. 00:22:12.076 --> 00:22:18.251 And, you know, we're I, and then we're, you know, potentially never, really freed from this the, this cycle um, that we're in. 00:22:18.251 --> 00:22:25.821 But I do think though the current you know, circumstances that we've seen this year, you know, I, I think does have, Certain legislators, rethinking these powers. 00:22:26.278 --> 00:22:27.628 and there were a couple bills. 00:22:28.078 --> 00:22:32.278 Um, I believe one was introduced by Senator Rand Paul earlier this year. 00:22:32.278 --> 00:22:33.269 There might have been another bill. 00:22:33.269 --> 00:22:36.489 There were a couple of bills floating around in Congress. 00:22:36.588 --> 00:22:40.598 That would return on these authorities to the legislative branch. 00:22:40.628 --> 00:22:48.689 But they have not, you know, they have not been getting you know, a lot of traction, I think because a lot don't wanna be seen as a going against the president in that fashion. 00:22:48.689 --> 00:22:51.028 I think that's something we'll have to just, you know, keep following. 00:22:51.028 --> 00:22:53.999 But, you know, I think it's, I think it is possible that we do see. 00:22:54.713 --> 00:22:58.374 Down the road, Congress take back some of its powers as it relates to trade. 00:22:58.724 --> 00:23:03.434 I think even this week or before the end of October, the Senate is gonna vote on maybe three different. 00:23:04.204 --> 00:23:06.785 Measures or motions related to the I EPA tariffs. 00:23:07.025 --> 00:23:12.575 So looking at like the National Emergency Declaration looking at Brazil and Canada specifically. 00:23:12.785 --> 00:23:21.095 So it will be interesting if they do get to take a vote on that to see how republicans in particular decide to participate in that vote. 00:23:21.404 --> 00:23:25.394 Whether they're ready to kind of go on record and say, yeah, this is. 00:23:26.380 --> 00:23:27.460 has gotten out of control. 00:23:27.460 --> 00:23:31.414 This needs pulled back, or whether they continue to defer to the president. 00:23:32.785 --> 00:23:42.859 Now as we're starting to wrap up here, what should listeners, you know, be watching for when oral arguments begin on November 5th and, and how could they keep up with the latest analysis here? 00:23:43.304 --> 00:23:45.410 we'll be covering it on the blog. 00:23:45.450 --> 00:23:51.430 We might do another podcast episode talking with some folks with legal expertise after the oral arguments take place. 00:23:51.865 --> 00:24:07.105 But one thing that, that the folks over at Cato um, Scott and Colin and Clark and their brief and in their writing about the ultimate decision have been talking about is, you know, if you look at the government's arguments, they're making some really fantastical claims, like, you know, this is gonna. 00:24:07.474 --> 00:24:08.914 Decimate the federal budget. 00:24:08.914 --> 00:24:12.964 If the president doesn't have this authority, this is gonna be terrible for the economy. 00:24:12.964 --> 00:24:14.105 Terrible for businesses. 00:24:14.345 --> 00:24:17.924 That's all very far removed from the legal question at hand. 00:24:18.315 --> 00:24:34.605 And so one of the things that, that they've been saying and using some of our modeling to, to argue is that, even if you take these, you know, fantastical economic and budgetary claims from the government and look at the actual analysis done the government's claims don't line up with reality. 00:24:34.845 --> 00:24:45.075 So I think one of the things I'll be listening for is, you know, whether the questions are related to these claims and what's gonna happen to the economy and what's gonna happen to the federal budget, or whether it's really. 00:24:45.434 --> 00:24:48.734 More focused on, okay, is there a national emergency? 00:24:48.765 --> 00:24:50.595 Does the statute allow for this? 00:24:50.595 --> 00:24:56.355 Are there other, you know, legal avenues that the president could use to impose tariffs if these really were problems? 00:24:56.704 --> 00:25:10.194 You know, I'm a legal expert at all, but I think that will tell us some of which way the justices are leaning by the types of questions they ask, how hard they push back on, on the government's claims about the importance of these supposed tariff powers. 00:25:10.974 --> 00:25:11.244 Yeah. 00:25:11.244 --> 00:25:11.815 And you know what? 00:25:11.815 --> 00:25:22.125 We have a wonderful resource on our website, that all three of us work on regularly and are constantly updating and it is confusing and chaotic to keep it all going, but we managed to keep it all going together. 00:25:22.575 --> 00:25:26.684 And so as we're signing off here, guys, I just wanna thank you for breaking all of this down for us. 00:25:26.684 --> 00:25:30.494 This is a really, I think, excellent way for people to kind of understand what's happening. 00:25:30.795 --> 00:25:34.184 And if you guys have any burning questions, you can send them our way. 00:25:34.184 --> 00:25:36.444 You can drop a comment on YouTube, you can email us at. 00:25:36.615 --> 00:25:38.565 podcast@taxfoundation.org. 00:25:38.775 --> 00:25:41.355 You can DM us on Twitter at Deduction Pod. 00:25:41.775 --> 00:25:43.065 Thank you all so much for listening.