Thread by @_Investinq

🚨 Federal court just shut down Trump’s biggest economic weapon.

This doesn’t just kill tariffs.

It could rewrite presidential power and disrupt global trade.

Here’s what just happened and why it changes everything.

( a thread)

Trump’s entire second-term economic plan hinges on one core strategy: using tariffs to force the world to play by U.S. terms.

He dubbed it “Liberation Day”, a dramatic reworking of trade policy meant to bring back American manufacturing jobs and slash the federal deficit.

But a federal court just told him flat-out: You can’t do that.

Trump didn’t get Congress on board. Instead, he invoked a 1977 law , the International Emergency Economic Powers Act (IEEPA) to impose sweeping tariffs on almost every major U.S. trading partner.

He argued the trade deficit, when the U.S. imports more than it exports was a national emergency that justified unilateral action.

The legal bet? That a decades-old Cold War statute could justify reshaping the entire global trading system.

That bet failed.

In a unanimous 3-0 ruling, a panel of federal trade judges, appointed by Trump, Reagan, and Obama ruled that IEEPA does not give the president the power to rewrite tax policy on imports.

In simple terms: the court said tariffs are taxes, and only Congress has the power to tax.
No matter how urgent a president claims the problem is.

Here’s why that matters. IEEPA was created to give the president emergency powers to deal with real national security threats: think seizing foreign assets during war, blocking terrorist funding, or halting cyberattacks.

It was never designed to let a president say “the economy feels off” and start rewriting trade law.

Especially not over something like the trade deficit which the U.S. has run for 49 straight years.

So what exactly are tariffs? They’re taxes that governments place on imported goods — like steel, cars, food, and electronics.

The goal can be to protect local industries, punish foreign competitors, or raise money.
But here’s what most people miss: foreign countries don’t pay them.

American companies do. And those costs? They get passed right to you, the consumer.

Trump treated tariffs like a blunt-force weapon.

He hit Canada, China, Mexico, and even allies in Europe with unilateral import taxes.
He set the rates himself.

He bypassed Congress and the list of products affected was massive everything from steel and aluminum to luxury goods, wine, and car parts.

It was a full-on trade war waged without the usual checks and balances.

The court’s decision called this exactly what it was: an overreach. They said Trump’s “Worldwide and Retaliatory Tariff Orders” had no legal basis under IEEPA.

No emergency powers justify what was essentially a rewrite of U.S. trade law.

Presidents can’t just declare “emergencies” to do what Congress won’t. That’s not how constitutional power works and the judges made that crystal clear.

Not all tariffs are gone, though. The court left in place a different category those under Section 232 of the Trade Expansion Act of 1962.

That law allows tariffs when imports are found to threaten national security.

Trump used it to impose tariffs on foreign steel, aluminum, and some auto parts but even those are under legal and political pressure and far more limited than the IEEPA-based ones.

Trump had another legal option, Section 122 of the Trade Act of 1974. It allows the president to impose tariffs of up to 15% for 150 days if there’s a significant trade imbalance.

But that would’ve been temporary, smaller, and subject to more oversight.

He didn’t want that. He wanted full control, fast and that’s what got struck down.

The Trump administration immediately filed an appeal. Their argument: courts can’t second-guess a president’s definition of a “national emergency.”

In their view, once the president declares one, he should have wide leeway especially in economic matters.

If that argument wins, it could expand presidential power in ways no court has ever allowed and now, all eyes are on the Supreme Court.

Will Trump win the appeal? Legal experts say: unlikely.

In recent years, the Supreme Court has taken a hard stance against presidents stretching executive authority beyond what Congress clearly allowed.

They’ve shut down sweeping environmental regulations, student loan forgiveness, and vaccine mandates. This case fits that trend: a major policy move, based on emergency powers, without clear legal backing.

The implications are enormous. This ruling won’t just define Trump’s trade agenda.

It’s about the balance of power who gets to make decisions that affect the global economy, the prices you pay, and the rules of international commerce.

And if courts stand firm, it could redraw the limits of presidential power in ways that outlast any one president. Stay tuned.

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