States Sue to Block New Section 122 Tariffs as Trade Court Orders $130 B Refunds

This clash recalls Richard Nixon’s 10 % “import surcharge” of August 1971—also invoked under balance-of-payments authority—and the Supreme Court’s 1936 invalidation of President Roosevelt’s AAA processing taxes; each episode checked executive overreach in economic emergencies. The current rulings fit a decades-long tug-of-war between Congress’s constitutional power over tariffs and presidents’ appetite for unilateral trade weapons, intensified since the 1974 Trade Act and the post-2001 rise of security-based levies. By yanking a projected $1.7 trillion revenue stream and compelling massive refunds, the courts have exposed the fiscal fragility of relying on executive tariffs and may drive lawmakers to reassert control or seek new taxes. On a century scale, the episode could mark either a re-entrenchment of rule-based trade—echoing the 1947 GATT era—or, if Congress lets the president find another workaround, a step toward a more nationalist, executive-driven tariff regime reminiscent of pre-WWII protectionism.