The Indicator from Planet Money Trump's backup options for tariffs
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Nov 12, 2025 
Phil Magnus, a senior fellow at the Independent Institute and trade policy commentator, delves into President Trump’s potential backup strategies for tariffs amidst an impending Supreme Court ruling. He highlights the controversial use of the International Emergency Economic Powers Act and discusses its unprecedented legal standing. The conversation also explores historical tariff laws, including the Smoot-Hawley Act and Section 232, emphasizing their implications for national security. Magnus sheds light on why Congress remains an avoided route for tariff implementation due to political backlash.
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Why The Administration Chose IEPA
- The administration prefers the International Emergency Economic Powers Act because it grants the president broad, unilateral tariff powers.
- That law bypasses congressional oversight and allows rapid, flexible tariff decisions according to the administration's interpretation.
Smoot-Hawley As The Closest Backup
- Section 338 of the Tariff Act (Smoot-Hawley) is the closest legal backup to IEPA and can authorize tariffs up to 50%.
- It requires findings about discrimination against U.S. commerce and is slower and more constrained than IEPA.
Section 122: Fast But Temporary
- Section 122 from the Trade Act of 1974 can be a quick tool because it may not need a prior investigation.
- Its limits are sharp: tariffs can last only 150 days without congressional approval and top out at 15%.