President Donald Trump warned that the U.S. economy would face significant challenges if the Supreme Court rules against most of the tariffs imposed this year.
Trump underlines the revenue and leverage of tariffs
Trump, in an interview with Maria Bartiromo on ‘Sunday Morning Futures’ highlighted the importance of tariffs for both revenues and diplomatic clout. The President also stated that trade agreements with several countries have generated investments of more than $17 trillion in the US economy.
He and other members of the Cabinet have cast the possible outcome of a tariff case in dire terms, suggesting it could “literally destroy the United States.”
“If we don’t do that, we’re going to have a hard time for years to come,” Trump said, underscoring the potential long-term impact of a negative ruling. He also claimed that tariffs played a role in ending eight wars, including the conflict between India and Pakistan.
“I’ll have to think of something. I don’t even want to think about it, we’re doing so well,” Trump said.
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Trump’s earlier warnings about the Supreme Court ruling
This isn’t the first time Trump has warned about the potential consequences of a Supreme Court ruling against his tariffs. In September, he stressed that such a decision could force the US to “terminate” trade deals with the EU, Japan and South Korea, which could have serious consequences for the country.
Trump also warned of a massive debt that could reach “trillions and trillions of dollars” if the Supreme Court were to nullify his tariffs. He also expressed concerns about the potential economic impact on the stock market if the ruling does not go in his favor.
Backup plan to maintain Trump tariffs
Should the Supreme Court uphold the IEEPA ruling, it is estimated that approximately 70% of the imposed tariffs would be lifted. However, the administration has recently used other trade authorities, such as Section 232 sectoral tariffs and other backup plans, to keep the tariffs in place and potentially soften the economic impact of an adverse ruling.
The Trump administration had previously appealed an “illegal” tariff ruling to the Supreme Court and urged swift action.
Rather, economist Peter Schiff had predicted that Trump’s tariffs would likely be declared “unconstitutional” by the U.S. Court of Appeals. This could lead to US importers clawing back significant amounts already paid in tariffs, further complicating the economic scenario.
Price promotion
On an annual basis the SPDR S&P 500 ETF Trust (NYSE:SPY) and Invesco QQQ Trust ETF (NASDAQ:QQQ), which track the S&P 500 Index and the Nasdaq 100 Index, respectively, rose 13.64% and 18.36% each, according to Benzinga Pro facts.
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