Could a Supreme Court tariff ruling send mortgage rates soaring?

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“I think that if you apply the law as it was understood until last year, there’s really no serious doubt that the tariffs are illegal,” Katkin said. “But the Supreme Court has been making a lot of changes over the past year in the way they view the relationship between the executive branch and Congress, and they’ve really been shifting power from Congress to the executive branch.

“This court, in terms of its habits of mind or its judicial philosophy, likes a really strong presidency. So it might be thinking about changing the law in Trump’s favor, but I certainly think, as a matter of existing law, the statutory framework that Trump is trying to rely on does not support the tariff.”

Katkin said Trump has been using a statute, in combination with declaring emergencies, to issue tariffs worldwide.

“A lot of the attention that he’s been getting is because of his reliance on a statute called the International Emergency Economic Powers Act,” he said. “His reading is pretty implausible, but that’s a statute that says if there’s an international emergency or crisis that comes up very suddenly, then the President can take economic sanctions against other countries. I think that’s a very implausible reading of that statute, and the court really should strike that down.

“There are other statutes out there that actually deal more directly with trade disputes and with the president’s power to use tariffs in response to particular trade disputes. I think those would be a stronger basis for supporting some tariffs, but only when there is a bona fide trade dispute.”

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