CNN
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No matter the outcome of a major legal case on President Donald Trump’s tariffs, his import taxes are likely here to stay — in one form or another.
Even before a Wednesday ruling that Trump overstepped his authority by using a national emergency to impose most of his tariffs, there had already been discussions inside the West Wing about options if the courts struck down his expansive and untested use of emergency authority, two senior administration officials told CNN.
“We really do think we have a strong case and will win,” one of the officials said. “But we do have other tools that can get us to the same exact place we’re ready to use if necessary.” Key to those efforts: using different trade-related laws to push forward more tariffs.
Here are the most likely options the administration could tap into:
This law allows a president to levy a tariff of up to 15% for a maximum of 150 days to address “large and serious United States balance-of-payments deficits.” That would occur when the value of a country’s imports far exceeds that of exports, also referred to as a trade deficit.
The US currently runs an $87.6 billion goods trade deficit, according to advanced figures the Census Bureau released on Friday. Trump often claims large deficits are a sign the US is being “ripped off” and treated unfairly. Many economists, however, are much less convinced of his argument, with some even noting that a trade deficit can be a reflection of a strong economy and the power of the US to effectively stimulate the global economy.
Administration officials initially weighed using Section 122 to impose higher tariffs but decided not to, due to the 150-day limit. If the administration goes down this path, it could replace the current 10% universal baseline tariff on nearly every country’s exports.
After the 150-day period concludes, the levies can only continue if Congress signs off on them.
This gives the president the authority to impose higher tariffs on national security grounds. It can only be used to target specific sectors and requires an investigation to be launched before tariffs can be imposed.
For instance, a recent Section 232 investigation the administration launched into imports of critical minerals claimed that “overreliance on foreign critical minerals and their derivative products could jeopardize US defense capabilities, infrastructure development, and technological innovation.”
There are several other current Section 232 investigations concerning other sectors. The 25% across-the-board tariffs on steel, aluminum, cars and car parts were all the result of 232 investigations. These tariffs can continue to remain in place regardless of how the appeal on the allegedly emergency-related tariffs proceeds.
“Trump has not emphasized sectoral tariffs as frequently lately as he did earlier this year, but if the White House finds it has less flexibility on country-focused tariffs, sectoral tariffs might receive more attention again,” Goldman Sachs economists said in a recent note.
This allows the USTR to investigate countries potentially violating other nations’ trade agreements or practices in a way that is “unjustifiable” and “burdens or restricts” US business. Trump used Section 301 during his first term to hike tariffs on several Chinese imports, along with aircraft and other European Union goods.
Ultimately, it could take weeks or even months for those investigations to lead to tariffs because of the lengthier process involved, including a period for public comment, compared to recently imposed tariffs.
But, unlike Section 122, there’s no limit to the level or duration of tariffs arising from Section 301 investigations.
While never implemented by any president, Trump can use this law to impose tariffs of up to 50% on countries’ imports if he believes they are engaging in trade practices that discriminate against the US. Doing so, however, could violate World Trade Organization agreement terms and prompt steep retaliation from impacted countries.
Despite the clear setback delivered by the courts, administration officials insist nothing has shifted in Trump’s thinking.
That message is in part one of necessity, given that the threat of dramatically higher tariff rates is the central leverage the administration is using in the 18 separate bilateral trade talks that the administration says are underway.
“President Trump is 100% serious about this,” one official told CNN.
