(Bloomberg, New York) -- Nearly 50 bipartisan U.S. economists, including former Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Janet Yellen, have filed a brief with the U.S. Supreme Court, calling for the reciprocal tariffs imposed by President Trump on global trading partners.
In their amicus brief, filed on Friday (October 24), the economists argue that Trump's tariff policy is based on a misunderstanding of how the global economy works, yet will have far-reaching consequences.
They argue that the U.S. trade deficit with other countries is to be expected, not the "extraordinary and urgent" threat the Trump administration claims it poses, and that imposing reciprocal tariffs will not reduce that deficit. "Rather, tariffs will have a multi-trillion dollar impact on the U.S. economy, impacting every household and every state."
They criticize the Trump administration's practice of imposing tariffs based on the U.S. trade deficit with individual countries, making it virtually impossible to achieve trade balance. For example, bananas, because the U.S. climate is not suitable for growing them, must be imported from abroad, resulting in a chronic trade deficit. Conversely, the United States leads the world in technology, and as a result, has enjoyed a services trade surplus for decades.
The U.S. Supreme Court will hold a hearing on November 5th to determine the legality of Trump's invocation of the International Emergency Economic Powers Act to impose reciprocal tariffs. In a mid-September court filing, the Trump administration argued that tariffs are necessary to "correct the trade deficit that is stifling the United States." "For President Trump, the choice is clear: tariffs mean a prosperous America; no tariffs mean a poor America."
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Several other groups also filed briefs with the Supreme Court before Friday's deadline, including former federal judges, former defense and security officials, and the U.S. Chamber of Commerce.
The joint brief from the former defense and security officials argues that Trump's use of the International Emergency Economic Powers Act (IEEPA) would undermine the law used to sanction hostile countries alongside U.S. allies. The U.S. Chamber of Commerce argues that tariffs are essentially taxes on consumer goods, paid by American companies and ultimately by consumers. The framers of the U.S. Constitution understood that the power to tax equates to the power to destroy, and therefore granted Congress the power to levy taxes, including tariffs.
Several groups also filed briefs with the Supreme Court before the September 23rd deadline in support of Trump's tariff policy. Among them, the American Center for Law and Justice argues that the president is the sole authority for foreign affairs, and that "when courts question the president's determination of international economic conditions and economic threats, they not only exceed their legitimate role but also undermine the constitutional framework that has governed the United States for over 200 years."
