CNBC’s Megan Cassella joins 'The Exchange' to discuss Trump's tariffs facing legal challenges and his alternative trade agenda.

Washington

Donald Trump has signed an order to impose tariffs imports into the U.S. from countries including China, Mexico and Canada.

Global Tariffs

President Trump has defended the use of tariffs as essential for protecting domestic investments and maintaining the country's economic position. However, a pending Supreme Court decision could invalidate many of the tariffs currently in place, potentially resulting in a significant drop in government revenue.

In response, the White House is reviewing multiple legal options to continue imposing tariffs without needing congressional approval. These include invoking Section 338 of the Smoot-Hawley Act, Section 232 for national security-related tariffs, and Section 301, previously used against China. Officials indicate that the administration is determined to pursue these alternatives to uphold tariff policies regardless of the court's ruling.

Trump's tariffs legal woes and the White House potential alternatives

We're leading because of tariffs. We're leading because of talent and this is where they'd like to be but without the tariffs We wouldn't have a chance because we wouldn't be able to protect those investments of the companies coming in. So If you took away tariffs We we could end up being a third world country That's how that's how big the ruling so we're asking for an expedited ruling All right That of course was President Trump just yesterday in the Oval Office making his case for why the country needs tariffs But what happens if the Supreme Court's decision does not go his way? Megan Casella is in Washington DC with that story Megan. Hey Dom, it's a huge question right now So the vast majority of tariffs imposed so far This term would fall away if the president loses this case and that would mean a big drop in revenue just over half a billion Dollars expected to come in over a decade if the court ruling holds according to the Tax Foundation versus 2.3 trillion Estimated now But the White House has vowed to find other ways to impose the tariffs in part to keep up that revenue and they're working on A handful of options the president can pursue without Congress So the first and probably the most likely is called section 338. It's part of the Smoot-Hawley Act passed back in 1930 Officials have talked openly about using this and while it was not of course the initial justification for the president's tariffs Trump allies at the America First Policy Institute are now arguing before the court that an executive order can be upheld Under a statute not originally cited they say section 338 fits the challenge tariffs like a glove Now the next best option is section 232 of trade law This allows tariffs on individual sectors for national security reasons and nine of these investigations are currently ongoing Which could mean tariffs on a staggering amount of trade? You can see it here things like furniture and smartphones to solar panels and windmills And there are other options to Dom section 301 is what he used in the first term against China Another statute allows tariffs on a temporary basis, but to correct for trade deficits And so the upshot here is that no matter what happens the president doesn't have to turn to Congress He will all but certainly be finding ways to forge ahead by himself dumb All right, Megan Casella with that there on the latest on the trade front. Thank you very much for that

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Trump's tariffs legal woes and the White House potential alternatives

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