00:00Hi, everybody. I'm Brittany Lewis, a breaking news reporter here at Forbes. Joining me now
00:07is Ilya Soman, law professor at George Mason University. Professor Soman, thank you so much
00:12for joining me. Thank you for having me. Professor Soman, I'm grateful for you coming on because you
00:17have joined me a few times in the past couple of months to talk about the lawsuit that you
00:22and the Liberty Justice Center filed against President Trump's Liberation Day tariffs.
00:27And this just celebrated another legal win, this time in an appeals court. In a 7-4 ruling,
00:33the U.S. Court of Appeals for the Federal Circuit said that President Trump overstepped his
00:38presidential authority by invoking the International Emergency Economic Powers Act to impose tariffs.
00:44So to start off the conversation, what's your reaction to the ruling? Well, of course, we're
00:48very happy that the court ruled the way it did and recognized that this was an illegal user patient
00:55of congressional power and not something that the president can do on his own. The Constitution
01:00gives the power to impose tariffs and other taxes to Congress, not to the president. And I think the
01:07court rightly concluded here that he simply can't impose these massive tariffs without far more in
01:15the way of clear congressional authorization. I want to talk about what exactly that ruling said,
01:21because the ruling said imposing tariff policy is, quote, vested exclusively in the legislative branch
01:27and a, quote, core congressional power. The dissenting judges, however, wrote this, quote,
01:33IEPA's authorization of presidential action in this realm is not an unconstitutional delegation
01:39of legislative authority under the Supreme Court's decisions, which have upheld broad grants of
01:44authority, including tariffing authority in this foreign affairs related area. What do you make
01:50of what the dissenting judges wrote? Because this was a 7-4 ruling. Yeah, so obviously, it's no surprise
01:58that I might disagree with some things that the dissenting judges wrote. But basically, it comes down to
02:04this, that under the president's interpretation of this law, he would have virtually unlimited power
02:11to impose any tariffs he wants at any time for any reason in any amount for as long as he wants.
02:17And if anything is an unconstitutional delegation of legislative power to Congress, then it's something
02:24like this, a virtually unlimited delegation of what the majority rightly said is a core congressional power.
02:30Moreover, this is a law that doesn't even mention the word tariffs or a synonym like
02:37impose or duties. It just says that under the SWAT, there is sometimes a power to, quote, unquote,
02:44regulate certain kinds of international transactions. As a majority explains, regulation and taxation
02:50are two distinct powers historically. And we cannot assume that the word regulate, impose,
02:57includes a power to tax, and certainly not one that is on this gigantic scale, where you would have
03:05the highest tariffs since those that helped deepen and cause the Great Depression.
03:12That's what the judges who ruled in your favor said, that the word tariffs or even a synonym of
03:17the word tariffs is not mentioned anywhere in IEBA. And you represent in the lawsuit, five small
03:23businesses who would be impacted by tariffs. So A, what has their reaction been to this ruling? And B,
03:30how have they been impacted by tariffs so far? So like with a lot of small businesses and other
03:36businesses throughout the United States, obviously, the impact has been very painful and difficult.
03:41Many American businesses get goods from abroad that they need to do their work, inputs for production
03:48goods and so forth, which are often either just not available in the United States or only available
03:54at much higher cost or lower quality. So these tariffs, if allowed to stay in place, would be very
03:59damaging to the American economy, to businesses and also to consumers who end up having to pay higher
04:05prices. President Trump, it's probably no surprise to you, was not happy with this ruling. I want to
04:13read something that he posted in part on Truth Social. Quote, the USA will no longer tolerate enormous
04:19trade deficits and unfair tariffs and non-tariff trade barriers imposed by other countries, friend or foe,
04:25that undermine our manufacturers, farmers and everyone else. If allowed to stand, this decision
04:31would literally destroy the United States of America. At the start of this Labor Day weekend,
04:35we should all remember that tariffs are the best tool to help our workers and support companies that
04:40produce great made in America products. What do you make of his reaction there?
04:46Well, I guess I could make the obvious point that the United States very much existed before these
04:51tariffs were put in place and would certainly continue to exist without them. Moreover,
04:56the United States would be better off without them because economists estimate that if these
05:01tariffs remain in place, they would greatly reduce economic growth, raise prices for consumers and
05:07reduce incomes for far more workers than they might help. That's actually just fairly basic economics 101.
05:13And this ruling does not go into effect until October 14th. And President Trump himself has indicated that
05:21he's taking this to the Supreme Court. How are you gearing up for that fight?
05:26So obviously, if the case does go to the Supreme Court, we don't yet know for sure whether it will or not.
05:32But if it does, we will be prepared to defend our cause as we have so far.
05:37Are you concerned, though, about that Supreme Court fight? Because President Trump nominated three of those
05:43justices that now serve on the court, and it's a conservative-leaning court.
05:48So obviously, I can't know for sure what the Supreme Court justices might do. All I will say is that
05:54many of our arguments rely on doctrines that have been pioneered and defended by
05:59conservative Supreme Court justices as much as liberal ones. We've talked about the principle of
06:05non-delegation before, limits on the extent to which Congress can delegate executive powers to
06:10the president. If anything violates that, it's a virtually unlimited delegation of the kind that's
06:15being claimed here. And similarly, the Federal Circuit based this decision in part on the major
06:22questions doctrine, which says that if the executive is claiming that a power has been delegated to them,
06:29which enables them to decide large-scale social or economic issues, then at the very least,
06:35there has to be a clear delegation as opposed to something that's ambiguous. And here, it's
06:41difficult to think of a more major question than this one, when we're talking about trillions of
06:46dollars in new taxes imposed on the American people, massive damage to the economy, and so far.
06:52So again, I can't know whether the Supreme Court will take the case or what they will do if they were
06:57to take it. But I think we have very compelling arguments that can appeal to conservative and liberal
07:03jurisprudence. And as of now, these tariffs are in effect, like we said, until about mid-October.
07:12What do you think this fight, this legal challenge and your legal win so far means for President
07:18Trump's tariff policy overall? So we'll see. Obviously, we'll see if the case goes to the
07:25Supreme Court and what it decides. But we hope if we continue to win that these tariffs will be removed
07:31and they could only be put back in place if Congress were to enact them, which is the branch of
07:36government that is supposed to have the power over these sorts of issues.
07:41And since President Trump's tariffs took place in April, the United States brought in around $96
07:46billion worth of revenue from these tariffs. If this ruling is upheld, where does all that money go?
07:53Is it disseminated back to these businesses? What does that really look like?
07:56So there might be a complicated process at that point. And I admit, I'm not fully expert in how
08:03that process works. I'm on the case because of my expertise in certain constitutional law issues
08:08and related questions. But my understanding would be that if the courts continue to hold that these
08:14tariffs are illegal, then sooner or later, the tariffs that were previously paid and collected
08:20illegally would have to be repaid and given back to those who paid them.
08:24And what's next for this lawsuit? What are the next steps here? Because I know that
08:29you could be potentially gearing up for a Supreme Court fight. But what are you specifically doing
08:34next? So at this point, I'm not doing much of anything other than waiting to see if the
08:41administration does indeed ask the Supreme Court to take the case and then whether the Supreme Court
08:47will in fact take it. If they do, then of course, we will be ready to defend our case.
08:52And I know from someone with a perspective, a legal perspective, someone who's an expert
08:59on the Constitution, especially in this realm, what do you think about President Trump's trade
09:05policy then from that lens? If this is upheld, does his entire trade policy unravel? I mean,
09:12what's really left of that?
09:14So that's more a question for him than perhaps for me. But obviously, the implication would be that
09:22if you want to impose massive new tariffs and taxes, you have to go to the branch of government,
09:27which has the power to do that, which is Congress. You can't just do it on one person's whim.
09:33Well, there's certainly a lot to look out for, Professor Soman. I appreciate you coming on and
09:38breaking it down with me. Thank you so much for joining me. And when or if we see this reach the
09:44Supreme Court, I hope you can come back on and discuss it then. Thank you for your time.
09:49Thank you so much.
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