WASHINGTON, Feb 22 - The U.S. Supreme Court's decision to invalidate a major part of the tariff program that relied on emergency authority has reduced the president's capacity to threaten and apply tariffs on short notice. Yet the ruling stops short of ending the persistent uncertainty that companies and foreign governments have faced over sudden trade actions.
Within hours of the Court's Friday decision, the White House announced a new 10% tariff on all imports and directed new trade investigations that could yield additional duties in the months ahead. Administration officials argued that existing trade and investment arrangements negotiated with almost 20 countries - many of which included higher tariff rates - should remain in place despite the legal setback. Less than a day after the initial replacement, the president raised the temporary universal tariff to 15%, citing the maximum permitted by law.
Observers of international trade policy said the rapid administrative response reflects the White House's preference for keeping counterparts off balance. Wendy Cutler, a former U.S. trade official and now senior vice president at the Asia Society Policy Institute, described the move as emblematic of a tactic that relies on uncertainty for leverage. "The uncertainty, in his view, just gives him enormous additional leverage beyond the actual tariffs. Because people are worried about what he’ll do," she said.
Still, Cutler and other trade specialists noted that the Court's ruling has materially constrained the president's toolkit. The 10% universal tariff created after the decision is limited to a 150-day duration, and tariffs enacted under other statutory authorities will require more time to put into effect. That timeline reduces the administration's previous ability to deploy the sort of immediate, across-the-board levies that were enabled by IEEPA.
"He’s lost his favorite tool," Cutler said, adding that the president no longer has the ready instrument for addressing foreign policy disputes or other matters that are unrelated to trade.
Former government trade officials echoed that assessment. William Reinsch, who served in senior U.S. government roles and now works at the Center for Strategic and International Studies, said the Court's 6-3 decision takes away a prominent method of international coercion. "It takes away his ability to wave the big stick around," Reinsch said. He added that the immediate economic consequences are likely to be limited because the administration's new universal tariff and additional duties expected down the line will replace at least some of the levies that the Supreme Court deemed unlawful.
Michael Froman, president of the Council on Foreign Relations and a former U.S. trade negotiator, highlighted practical questions left unsettled by the ruling and the administration's quick countermeasures. Froman pointed to unresolved issues including how importers will obtain refunds for duties that were collected under statutes that have now been invalidated and what other tariffs may still be forthcoming. He suggested the most significant effect of the decision could be to curtail the use of tariffs as the president's go-to instrument for punishment or coercion outside the sphere of traditional trade policy.
For countries that have felt targeted by unpredictable tariff threats, the decision promises some relief. The White House previously used IEEPA to impose tariffs as a form of pressure over a wide range of non-trade matters, leaving trading partners unsettled. That pattern encompassed threats against multiple jurisdictions over issues as distinct as contested territorial claims, the handling of imports of electric vehicles from China, and the political posture toward leaders allied with the president.
Josh Lipsky, chair of international economics at the Atlantic Council, cautioned that while the ruling represents a meaningful blow to the administration's trade agenda, it is not necessarily debilitating. He noted the administration retains other statutory authorities to impose tariffs and that the ultimate effect on leverage will depend on how those authorities are used in practice. "It’s a significant blow to his international economic trade agenda. It’s not a crippling one, necessarily, because of the other authorities, but we have to see how they play out in practice," Lipsky said.
The legal outcome also casts uncertainty over the future of nearly 20 framework agreements or more concrete arrangements the administration announced in recent months that were negotiated against the backdrop of IEEPA-backed threats. Administration figures including the U.S. Trade Representative and the Treasury Secretary asserted that those deals should remain intact, even when their negotiated tariff levels exceed the temporary, universal rate.
Analysts expressed skepticism about whether countries would openly seek to withdraw from or renegotiate such accords, given concerns about provoking further executive retaliation. Miriam Sapiro, a former senior trade official, said the administration has lost what she called the "trade bazooka," but she did not foresee the immediate collapse of the deals. Instead, Sapiro suggested the ruling could shift bargaining dynamics, granting countries somewhat more leverage when entering new or ongoing talks with the U.S.
"There’ll still be interest in doing deals because of the uncertainty and the desire to keep the U.S. as a strong ally and strong partner," Sapiro said. "But countries do have a bit more bargaining power than they might have felt they had previously." From the administration's perspective, Sapiro noted, the use of IEEPA was a deliberate risk used to accelerate certain outcomes, even though some deal details remained unresolved and enforcement could be difficult.
U.S. Trade Representative Jamieson Greer defended the prior use of IEEPA on television, saying the authority had been an appropriate instrument at the time because it allowed the administration to move rapidly and flexibly. Greer argued the approach helped broaden market access for U.S. businesses. "We don’t regret it," he said, adding that the administration would pursue other tools going forward.
Initial reactions abroad were cautious as foreign governments weighed the implications of the Court's judgement and Washington's response. South Korea said it would examine the decision and the U.S. actions, while indicating a continued desire to pursue "amicable" implementation discussions over a tariff-related pact finalized in November that included $350 billion in investment pledges. Analysts based at Korean-focused institutions assessed that the administration's ongoing access to other tariff authorities would likely encourage South Korea and its businesses to uphold their commitments.
Tom Ramage, an economic policy analyst at the Korea Economic Institute of America, cautioned that any perceived retreat by partners from agreed terms could raise the risk of additional retaliation. He suggested that reluctance to scale back investments or commitments would reduce the chance the president would single out countries for punitive action.
Even as the Supreme Court decision has curtailed the most expansive emergency-based tariff tool, the combination of a short-term universal tariff, pending investigations, and the potential use of other statutory mechanisms mean that commercial and governmental uncertainty will persist into the coming months. That continuing ambiguity will affect importers, multinational companies with extended supply chains, and nations party to recent bilateral framework agreements as they evaluate enforcement, potential refunds for duties previously collected, and the negotiating leverage they may now hold.
The ruling is therefore likely to reshape the contours of U.S. tariff policy and bargaining dynamics without providing a definitive end to the volatility that has characterized recent trade relations.