Trade Policy for Tomorrow: Put Tariff Authority Back in Congress

An authority question decided, then reopened within hours

For most of 2025, the administration's tariff program rested on the International Emergency Economic Powers Act, a sanctions law never before used to impose tariffs at all. Multiple companies and states sued. On February 20, 2026, the Supreme Court decided Learning Resources, Inc. v. Trump, 6-3, holding that IEEPA's authority to "regulate importation" does not include the power to impose a tariff, because regulating and taxing are different powers and Congress has always used explicit tariff language when it meant to delegate one. Six justices agreed on that bottom line even though they split on the reasoning behind it: three, led by the Chief Justice, invoked the major questions doctrine, while three others reached the same result on the statute's text alone. Thomas, Alito, and Kavanaugh dissented. The ruling voided the IEEPA tariff program and opened a refund process that CBP estimates could reach tens of billions of dollars in claims.

The response arrived the same day. The administration invoked Section 122 of the Trade Act of 1974, a 1970s balance-of-payments provision, to reimpose a 10% global tariff effective February 24, 2026. Section 122 carries its own hard statutory limits: a 15% rate cap and a 150-day duration, expiring on July 24, 2026, unless Congress affirmatively extends it. In May 2026, the Court of International Trade ruled that the specific "balance-of-payments deficit" finding behind the Section 122 tariff didn't meet the statute's own definition, though the injunction reached only the named plaintiffs; the Federal Circuit stayed that ruling in June 2026 while the government's appeal proceeds, so collection continues in the meantime. With the July 24 sunset approaching, the U.S. Trade Representative has already proposed new Section 301 tariffs, 10-12.5%, against 59 countries and the European Union over forced-labor practices, with a comment period closing July 6, 2026, and a hearing the next day, explicitly framed as a bridge to whatever fills the gap Section 122 leaves. Three distinct statutory bases for functionally the same tariff, each contested or time-limited, is what this issue means by an authority question decided in court and reopened in the executive branch within hours.

What "harnessing technology" means once chip export controls are out of scope

AI-07 already owns the chip-export-control half of this platform's technology-and-trade story: tiered compute thresholds, allied coordination, a firm line against using export authority to reach model behavior. That leaves two technology-adjacent trade questions this issue can answer without duplicating it.

The first is enforcement infrastructure. The de minimis exemption, which let shipments under $800 enter duty-free, ended for all countries on August 29, 2025, after the administration cited it as the entry point for the large majority of narcotics and counterfeit-goods seizures. Congress had already voted to repeal the exemption's statutory basis for 2027; the executive order simply moved the date up. The technology gap this issue targets is on the enforcement side: CBP is now processing a volume of low-value parcels it wasn't built to screen individually, and the honest fix is investment in automated, risk-based targeting instead of treating every parcel from every seller as an equivalent security risk.

The second is digital trade specifically. The U.S. withdrew from the OECD's Pillar One digital-tax negotiations in January 2025, and the digital-services-tax fight with the EU, France, and others was explicitly carved out of the broader EU-US tariff framework that European lawmakers ratified in June 2026. The administration's stated tool for resolving what the framework left out is a threatened 100% tariff on digital-services-tax countries. That's a worse process than the one that produced the underlying deal: the ratified framework itself is proof a negotiated outcome was reachable on every other disputed line item. This issue doesn't propose its own separate DST mechanism; ECON-05 already covers re-entering the multilateral Pillar One track in the depth the tax-policy question deserves, and running two different processes for the same dispute would be worse than either alone.

Trade-offs and opposing views

One objection carries weight: a congressional check slows the executive's ability to move fast in a crisis, and a visible 60-day clock hands a foreign negotiating partner a reason to wait out a vote instead of making concessions now. This issue's Steelman section takes that argument at full strength rather than in this summary form.