Tariffs

Trump's New Tariff Plan Still Asserts a Crisis That Does Not Exist

The president’s invocation of Section 122 conflates a trade deficit with a balance-of-payments deficit.

Jacob Sullum | 3.11.2026 12:01 AM

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(Liberty Justice Center/Palinchak/Dreamstime)

President Donald Trump's original plan for addressing the purported threat posed by the longstanding U.S. trade deficit, which the Supreme Court rejected in February, involved declaring an imaginary emergency to justify tariffs under a statute that does not authorize them. His backup plan, which he revealed immediately after that decision, avoids the second difficulty but not the first one.

The International Emergency Economic Powers Act (IEEPA), the 1977 law that Trump cited when he announced his sweeping "Liberation Day" tariffs last year, does not mention import taxes and had never been used to impose them. By contrast, Section 122 of the Trade Act of 1974, the provision Trump cited after his Supreme Court defeat, does authorize tariffs in certain circumstances.

The problem, according to a lawsuit that the Liberty Justice Center (LJC) filed on Monday in the U.S. Court of International Trade, is that those circumstances "do not currently exist." The LJC, which spearheaded the........

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