U.S. Treasury Secretary Scott Bessent on Monday expressed confidence that the U.S. Supreme Court will uphold President Donald Trump’s use of a 1977 emergency powers law to impose sweeping tariffs on most trading partners, but he said the administration has a backup plan if it does not.
Bessent told Reuters he was preparing a legal brief for the U.S. solicitor general, who will oversee the government’s appeal to the Supreme Court, that will underscore the urgency of addressing decades of trade imbalances and stopping the flow of deadly fentanyl into the United States.
A divided U.S. appeals court ruled on Friday that most of Trump’s tariffs are illegal, undercutting the Republican president’s use of the levies as a key economic policy tool. The court allowed the tariffs to remain in place through Oct. 14 to give the Trump administration a chance to file an appeal with the Supreme Court.
The 7-4 decision by the U.S. Court of Appeals for the Federal Circuit, in Washington, D.C., addressed the legality of what Trump calls “reciprocal” tariffs imposed as part of his trade war in April, as well as a separate set of tariffs imposed in February against China, Canada and Mexico aimed at halting imports of fentanyl.
The court’s decision does not affect tariffs issued under other legal authority, such as Trump’s tariffs on steel and aluminum imports.
Trump justified both sets of tariffs — as well as more recent levies — under the 1977 International Emergency Economic Powers Act (IEEPA). The law gives the president the power to address “unusual and extraordinary” threats during national emergencies.
Canada-U.S. trade negotiations ongoing
Canada and the U.S. initially had an Aug. 1 deadline to resolve the tariff dispute, but the date passed with no resolution.
Prime Minister Mark Carney announced on Aug. 22 that Canada would remove most of the counter-tariffs it put on U.S. goods earlier this year in an effort to revive trade negotiations with Washington, but he did not provide details on the sticking points.
Bessent expressed confidence the high court would back Trump’s action.
“I’m confident the Supreme Court will uphold it — will uphold the president’s authority to use IEEPA. And there are lots of other authorities that can be used — not as efficient, not as powerful,” he said, speaking to Reuters during a visit to a diner in the Washington suburbs.
One of those authorities, he said, could be Section 338 of the Smoot-Hawley Tariff Act of 1930, which allows the president to impose tariffs of up to 50 per cent for five months against imports from countries that are found to discriminate against U.S. commerce.
Doubles down on fentanyl as legitimate reason for tariffs
Bessent said the influx of deadly fentanyl, linked to some 70,000 deaths a year in the U.S., was a legitimate reason to call an emergency.
“If this is not a national emergency, what is?” he said, referring to thousands of drug overdoses linked to fentanyl. “When can you use IEEPA if not for fentanyl?”
