Court Blocks Trump’s Tariff Power, Yet Trade Talks Press On

31 August 2025

Containers are stacked on the deck of cargo ship One Minato at Port Liberty New York in Staten Island, New York, U.S., April 2, 2025. REUTERS/Jeenah Moon/File Photo

In a dramatic legal twist, a federal appeals court handed down a 7‑4 decision this month declaring that most of President Trump’s sweeping tariffs imposed under the cloak of emergency authority exceeded his constitutional powers. The ruling delivered a serious blow to his aggressive trade strategy. Yet, even as the court cast doubt on his economic edicts, the United States Trade Representative (USTR), Jamieson Greer, assured the world that trade negotiations remain very much alive.

Appearing on Fox & Friends on August 31, Greer emphasized that despite the ruling, the negotiations continue full steam ahead. “Our trading partners continue to work very closely with us on negotiations,” Greer said in a steady but firm tone. “People are moving forward with their deals, regardless of what this court may say in the interim.” Notably, he declined to name any specific countries involved but revealed that he had spoken with a foreign trade minister just the previous morning.

The legal challenge centers on the use of the International Emergency Economic Powers Act (IEEPA). This law grants the president authority to regulate commerce in the face of national emergencies but not to impose sweeping import taxes. The appeals court found that Trump overstepped, ruling that he lacks the power to levy tariffs as a blanket tool of foreign policy. While the most controversial levies targeting China, Canada, and Mexico were under scrutiny, they remain in effect temporarily until October 14, pending a Supreme Court appeal.

This move ignited a fierce response from Trump, who denounced the ruling as “unconstitutional” and vowed to carry the fight to the Supreme Court in pursuit of what he called “economic justice.” To him, tariffs aren’t just policy tools they are instruments of national strength.

Yet behind the scenes, the ruling complicates more than one high‑stakes negotiation. Tariffs have been Trump’s version of leverage in bargaining for favorable terms with international partners during his second term. The loss of those tools could shift the power dynamic in those trade talks. Markets have already shown signs of strain, with volatility surfacing across sectors and global uncertainty rising.

Meanwhile, the United States continues to negotiate. Analysts speculate that talks could include the EU, Asian trading partners, and even the UK but the USTR has stayed mum. Still, Greer’s comments convey a strategic message: the administration is not abandoning its trade ambitions, despite a potential constitutional blockade.

Legal experts suggest that Trump may pivot toward narrower laws to defend his tariff program or lobby Congress for explicit authority. But for now, the impending Supreme Court battle will determine whether these tariffs stand or falter and whether executive power in trade can continue to bend boundaries.

This clash unfolds as a rare convergence: presidential authority, trade diplomacy, judicial oversight, and global economic policy all colliding at once. It raises questions about the future of executive-driven trade policy and how resilient bilateral agreements will be in the face of shifting legal frameworks.

As Washington braces for the fallout, the implications are clear. If the administration prevails in the Supreme Court, tariffs will remain viable instruments of influence. If not, Congress may reclaim control, or the administration may be forced to rely on more limited pathways to manage global commerce.

Either way, this week’s ruling and subsequent refusal to disengage from trade talks set the stage for one of the most consequential debates in recent memory. The verdict, scheduled to take effect during a tense period of international diplomacy, serves as a gauge of where power and progress truly lies in trade policy.