SCOTT DETROW, HOST:
On Day 1 of his second presidential term, President Trump issued an executive order that called for a broad range of tariffs on virtually every U.S. trading partner. He did it by using the International Emergency Economic Powers Act, known as IEEPA. The president argued that both the statute and the Constitution allowed him to impose tariffs in order to deal with persistent trade imbalances, as well as to stem the flow of fentanyl coming into the United States. Both, Trump said, presented national emergencies and pose a threat to national security. Well, today, that argument suffered a massive defeat at the Supreme Court. NPR chief economics correspondent Scott Horsley and NPR legal affairs correspondent Nina Totenberg have been following this closely. They both join us now. Welcome to you both.
NINA TOTENBERG, BYLINE: Hello.
SCOTT HORSLEY, BYLINE: Good to be with you.
DETROW: Nina, I'm going to start with you. What did the court say?
TOTENBERG: Writing for a hefty 6-3 majority, Chief Justice John Roberts said that the nation's founders deliberately and explicitly placed the power to impose taxes - including tariffs - with Congress, not with the president. As the chief justice put it in his announcement from the bench this morning, having just fought a revolution motivated in large part by taxes imposed on them by the king of England without their consent, the framers wrote a Constitution that gives Congress the taxing power because the members of the legislature would be more accountable to the people. President Trump reacted to the decision today with fury.
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PRESIDENT DONALD TRUMP: They're just being fools and lap dogs for the RINOs and the radical-left Democrats.
DETROW: And I will just note, that's an insult in Republican world - Republican in name only - that Trump was citing. Trump says he can just use other statutes to do what he wants to do anyway. Is that true, Nina?
TOTENBERG: Yes and no. There are several statutes that allow him to impose some tariffs on his own, but they're limited. For example, one of the key statutes he cited allows him to impose certain tariffs on his own but only for six months. And after that, he has to get approval from Congress. And don't forget that all the money raised by the tariffs was supposed to offset the tax cuts - the Trump tax cuts, but now the money isn't going to be there.
DETROW: Scott, how much money is at stake here?
HORSLEY: There's a lot of money at stake. The federal government's been collecting about $30 billion a month in tariffs, and this ruling strikes down about half those import taxes. So it's a big deal, especially for the U.S. businesses that have been paying the lion's share of these tariffs. But as big as this ruling is, tariffs are still just a fairly small slice of overall government revenues - about 5%. So if half that tariff money goes away, it will mean a larger federal deficit, but it's not a crippling blow for the U.S. Treasury.
DETROW: These tariffs and the erratic way that they were introduced at so many points really, really jolted the economy around the world so many times. How did the market react to the news from the court?
HORSLEY: Stocks rose but not very much. It was actually a pretty muted reaction compared to the big sell-off last year when the worldwide tariffs were announced. Maybe that's because investors believe the White House is going to replace a lot of these outlawed tariffs with other taxes, using statutes where the president's authority's more clear. But as Nina points out, those other statutes do come with more strings attached. They don't give the president the power he claimed to have under IEEPA to impose unlimited tariffs on goods from any country for any reason.
DETROW: And another thing that happened today is that we got some new numbers on economic growth. What did they tell us about the effect of tariffs on the economy?
HORSLEY: The economy weathered Trump's tariff campaign in relatively good shape last year. We learned today the GDP grew 2.2% in 2025. That's a little bit slower than the year before but perfectly respectable. Even with all the taxes Trump piled on, though, imports did not go down last year. They actually went up a little bit. In some cases, importers are buying from different countries, as they try to sidestep the highest tariff rates, but overall trade has been pretty resilient.
DETROW: Are the companies that paid these tariffs going to be lining up for refunds now?
HORSLEY: Oh, yeah. Given the money at stake, I think you can bet on it. Chief Justice Roberts did not spell out today how refunds might work, so a lower court's going to have to work that out. Justice Kavanaugh, in his dissent, warned it could be a mess, echoing comments that came up during oral arguments. But I spoke today with veteran trade lawyer Robert Leo. He says refunding all those tens of billions of dollars will take some work, but he says it's very doable.
ROBERT LEO: It won't be a mess. Customs has all this information electronically. And I've talked to a number of our clients, and they know how much they've paid.
HORSLEY: You know, for most folks, filling out your taxes is no fun. But if you know you're going to get a refund, you will certainly make the effort. The National Retail Federation put out a statement today urging the lower court to ensure what it called a seamless process to refund the money that was wrongly collected from those importers.
DETROW: Nina, this court has been so deferential to executive power, especially in recent years. What does this opinion tell you about the court?
TOTENBERG: That it's particularly vigilant about what it views as the government picking people's pockets. In other words, it's a money case. And the majority opinion is what I would call a John Roberts special. He wrote a concise decision, accommodated the justices of the majority as much as necessary, and got the job done in Supreme Court terms quite quickly. The decision clearly tells the president to stay in his constitutional lane, but at the same time, Roberts' opinion only decides what has to be decided and gives the lower courts clear guidance on how to limit any Trumpian (ph) efforts to circumvent the opinion.
DETROW: It was a 6-3 split. How did that split break down?
TOTENBERG: Roberts' opinion was joined by two of the court's other conservatives - Trump appointees Gorsuch and Barrett - and the three liberal justices - Sotomayor, Kagan and Jackson. At the same time, what you see is a court that's deeply fractured, not so much about who wins and loses but how they win or lose. So today, for instance, Roberts wrote a 21-page opinion, but there were four concurring opinions - one by Justice Gorsuch totaling 46 pages and the dissent that Justice Kavanaugh wrote, a 63-pager. And all of these - of all of the justices, only two of them, Sotomayor and Kagan, did not write an opinion.
DETROW: Everybody had something to say.
TOTENBERG: Exactly.
DETROW: That is NPR legal affairs correspondent Nina Totenberg as well as Scott Horsley, our chief economics correspondent. Thanks to both of you.
TOTENBERG: Thank you.
HORSLEY: You're welcome. Transcript provided by NPR, Copyright NPR.
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