Source: Fortune
Summary
President Donald Trump has signed an order to impose new tariffs under Section 122 of the 1974 Trade Act, just hours after the Supreme Court struck down his global tariffs. However, economists and trade experts argue that this plan also has no legal basis. The new tariffs, which can be up to 15% for 150 days, are intended to address international payments problems, but the US currently has a flexible exchange rate and no balance-of-payments deficit. Experts claim that Section 122 does not apply in the current macro environment.
Our Reading
The numbers tell one story. Trump’s plan B for his tariff regime is being questioned by economists and trade experts. The US is invoking Section 122 of the 1974 Trade Act for the first time, but experts argue that this law doesn’t apply in the current macro environment. Trump’s new tariffs are seen as a way to buy time before investigations under Section 301 can be completed. The administration’s use of Section 122 is being criticized as an attempt to impose tariffs without a legal basis.
The announcement sounds familiar. Trump’s tariff regime is entering a familiar phase of uncertainty and criticism. The use of Section 122 is being seen as a way to circumvent the Supreme Court’s decision, but experts argue that this law is obsolete and doesn’t apply in the current economic environment.
Author: Evan Null
