The Trump Administration is requesting a federal appellate court to stick with its tariffs, stating that mitigating them could cause a financial downfall that would potentially result in an era of the Great Depression and threaten important programs such as Social Security and Medicare.
A Dire Warning to the Courts
A letter was filed on Monday with the U.S. Court of Appeals for the Federal Circuit. Solicitor General D. John Sauer and Assistant Attorney General Brett Shumate claimed that there might be devastating consequences if the president’s trade policies were overturned.
The administration stated that removing tariffs would potentially leave the United States liable for trillions of dollars in commitments that are tied to trade deals. This is money that the country still has not received yet and in certain cases, some agreements have not been fully executed.
“If the United States were forced to pay back the trillions of dollars committed to us, America could go from strength to failure the moment such an incorrect decision took effect,” Sauer and Shumate wrote.
The Legal Battle Over Trump’s Tariffs
The appellate court is currently deciding whether to support or overturn a ruling that came from the Court of International Trade in late May. There were a lot of arguments approximately two weeks ago and since then, Sauer and Shumate sent a letter stating the reasons why the tariffs should still remain in place.
These specific tariffs have been a significant part of the administration’s economic policies, but they have incited a lot of arguments from the start. There are many critics who mention that this increases costs for U.S. consumers and businesses but those who support this state that it’s important to protect American businesses and industries from unfair foreign competition.
The Administration’s Rationale
These tariffs were linked to a few trade deals with major countries such as Japan, South Korea as well as the European Union. These countries made a pledge to create large investments (as part of these agreements) to assist in financing projects in the United States. These investment funds were projected to be worth more than $1 trillion.
But most of that money hasn’t come through yet. The pledges are for future investments rather than direct payments to the U.S., and there are already disputes over how much these countries will ultimately contribute.
Limits of Backup Plans
Other officials from the administration noted that there were other strategies previously in place
“Other tariff authorities that the President could potentially use are short-term, not nearly as powerful, and would render America captive to the abuses that it has endured from far more aggressive countries,” Sauer and Shumate said in their letter.
Potential Consequences if Tariffs Fall
The administration argues that removing the tariffs:
- A quick collapse of major investment promises from foreign partners.
- Serious disruptions for U.S. industries that depend on tariff protections.
- An economic downturn on the scale of the Great Depression, bringing massive job losses and widespread bankruptcies.
- Threats to programs like Social Security and Medicare,
Sauer and Shumate also warned that removing the tariffs could also send the wrong impression abroad, and this may encourage other nations to take advantage of the U.S.
The Road Ahead
Regardless of what the appellate court decides, the administration has noted that it will take this fighter forward. There are many people who are anticipating this case will end up in the U.S Supreme Court.
Currently, the white house is preparing its argument, noting that the tariffs are a protection for the U.S. against an economic disaster. Citizens must keep updated with verified information and be sure to make proactive decisions.